Thirsty Mack’s Pty Ltd v Hasbeen Pty Ltd [2008] FCA 32

FEDERAL COURT OF AUSTRALIA

Thirsty Mack's Pty Ltd v Hasbeen Pty Ltd [2008] FCA 32 LANDLORD AND TENANT – OPTIONS AND AGREEMENTS TO PURCHASE – where applicant leased premises from first respondent – where lease registered – where lease contained option to purchase – where first respondent later leased premises to second respondent – where applicant subsequently exercised option to purchase – where first respondent delivered contract for sale and purchase of fee simple subject to lease to second respondent – where separate questions to be decided – whether option to purchase created equitable interest in property subject of lease – whether any such equitable interest enjoyed priority in relation to lease to second respondent – whether first respondent required to provide to applicant contract for sale and purchase of unencumbered fee simple Held: Option to purchase gave applicant optionee equitable interest in property – s 117 Real Property Act 1886 (SA) gave option to purchase indefeasibility or priority in relation to lease to second respondent – whether first respondent permitted to lease property to second respondent a question of parties' intention revealed by terms of option – parties intended applicant optionee to take unencumbered fee simple – first respondent required to provide to applicant contract for sale and purchase of unencumbered fee simple.

Federal Court Rules O 29 r 2 Real Property Act 1886 (SA) ss 56, 116, 117, 119 Trade Practices Act 1974 (Cth) ss 51AA, 80, 87 Braham v Walker(1961) 104 CLR 366 referred to Carter v Hyde (1923) 33 CLR 115 referred to Cook v Taylor [1942] Ch 349 referred to Commissioner of Taxes (Qld) v Camphin (1937) 57 CLR 127 referred to Crosby's Contract, Re; Crosby v Houghton [1949] 1 All ER 830 applied Fowler v Willis [1922] Ch D 514 referred to Latec Investments Ltd v Hotel Terrigal Pty Ltd (in liq) (1965) 113 CLR 265 referred to Laybutt v Amoco Australia Pty Ltd (1974) 132 CLR 59 referred to London and South Western Railway Co v Gomm (1882) 20 Ch D 562 referred to Mercantile Credits Ltd v Shell Co of Australia Ltd (1976) 136 CLR 326 referred to Rice v Rice (1853) 2 Drew 73; 61 ER 646 referred to