World By Nite Pty Ltd v Michael - [2003] QSC 52

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SUPREME COURT OF QUEENSLAND
CIVIL JURISDICTION
HELMAN J
NO 11806 of 2002
WORLD BY NITE PTY LTD

(ACN 100 098 164) Applicant
and
JAMES MICHAEL and
ANNE MICHAEL Respondents
BRISBANE
..DATE 31/01/2003
..JUDGMENT

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31012003 blp (Helman J)
HIS HONOUR: The respondents are the registered proprietors
of land at 25 Warner Street, Fortitude Valley, Brisbane, on
which stands a building at present occupied by the applicant
company. On 20 August 2002 the respondents granted a lease of
the land to the applicant for a term beginning on 1 May 2002
to expire on 30 April 2005 with options for two renewals of
three years each. The permitted use of the premises
provided for in the lease was "Cabaret/nightclub, wine bar
or adult entertainment venue". The applicant conducts an
establishment on the premises that falls within that
description. The rent was $72,000 per annum plus goods and
services tax.
Clause 2.1 of the lease provided for the payments the applicant as tenant was to make to the respondents as landlords. They included the rent of course (clause 2.1(a)),
and (17) of clause 1.2, the definitions clause, the terms
and a number of other payments including "the Agreed

"Agreed Proportion of Outgoings" and "Outgoings" were defined:
"(1) 'Agreed Proportion of Outgoings' means in respect
of all other Outgoings, a proportion determined
attributable to the premises as agreed between the
parties or as determined by the proportion that the
area of the Premises bears to the Area of the Land.
(17) 'Outgoings' means the Landlord's reasonable expenses
directly attributable to the operation, or
maintenance of the Building and charges, levies,

JUDGMENT

31012003 blp (Helman J)
premiums, rates or taxes payable by the Landlord
because it is the owner or occupier of the Building
or the Land, where those expenses are not paid for
directly by the tenant, and such expenses include,
but will not be limited to, all costs associated
with the following:
(a) rates, taxes and charges payable to
any government or other authority
(b) cleaning costs and materials
(c) rubbish removal
(d) light and power charges
(e) air-conditioning and…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading World By Nite Pty Ltd v Michael

Details

AGLC: World By Nite Pty Ltd v Michael [2003] QSC 52
Case: [2003] QSC 52
Decision Date: 28 February 2003

CaseChat Overview and Summary

World By Nite Pty Ltd (the applicant) leased property from Michael (the respondents) for a term of three years with options to renew. The applicant failed to pay rent for six months during 2002 and did not pay an insurance premium of $11,229.51. The respondents served seven notices to remedy the breaches, re-entered the premises, and excluded the applicant. The applicant commenced proceedings seeking relief against forfeiture of the lease and an interim injunction to gain access to the premises. The applicant argued that it was not obliged to pay the insurance premium because it did not include building insurance but rather business interruption insurance. The applicant also argued that the respondents had not provided a written notice of the manner of payment for the agreed proportion of operating expenses. The court considered the meaning of "building insurance" and whether it included business interruption insurance. The court found that the term could be construed to include business interruption insurance, and therefore the applicant was obliged to pay the insurance premium. The court also found that the respondents had not provided a written notice of the manner of payment for the agreed proportion of operating expenses. However, the lease allowed the landlord to send invoices directly to the tenant, which is what happened in this case. Therefore, the applicant was still obliged to pay the insurance premium. The court considered whether to grant relief against forfeiture of the lease. The court found that the applicant had a history of untimely payment of rent, but the delays were not particularly gross. The applicant had remedied all breaches except for the insurance premium payment. The court found that it would be inequitable to refuse relief against forfeiture, as the applicant was not on the brink of insolvency and had a reasonable likelihood of paying rent in the future. The court granted relief against forfeiture on conditions, including the payment of the insurance premium.

Orders