OF AUSTRALIA. » " w % a APPELLANT ; AND (MOTIGUIDATION)<<* :. + Af DESPONDENT. WESTERN (NEPEAN) arti PLAINTIFF, ON APPEAL FROM THE SUPREME COURT OF NEW SOUTH WALES. ving breach—Breach once for all—Waiver. 'A licence was granted by the appellant to the respondent to remove sand xd gravel from the bed of a river where the bed formed portion of or adjoined 'appellant's land. The grant was made upon the conditions that royalty be paid quarterly, that for the purpose of preventing the appellant's straying the respondent should at its own expense erect and maintain 'repair certain fences and a gate, and that if default in the performance of 'of the conditions were made by the respondent and it continued for thirty after any quarter day the appellant could determine the licence. The within which the fences and gate should be erected was not specified. respondent commenced operations under the licence about June 1937. time to time the appellant complained of the non-erection of the fences gate and in October 1939, by letter to the respondent, required that they erected within fourteen days. 'This requirement was not éomplied with, at the end of November the appellant accepted payment of royalty then In December the respondent went into liquidation, and a few days later 'appellant gave notice to the liquidator purporting to determine the licence 4, claiming possession of the premises. _ Held that in the circumstances the respondent should have erected the fences nd gate within a reasonable time of the commencement by it of operations Ets: the licence; that the non-erection thereof within such time was not BS Sontinuing breach but was a breach " once for all" ; and that, by allowing _the respondent thereafter to continue operations under the licence and accept- 2 therefor, the appellant had waived his right to determine the licence it of the breach, . H. C. or A. 1940. Ww Sypyey, Aug. Dee. Rich A.0.5., Starke and Dixon JJ. H. C. oF A. 1940. Ye Larking v Grear WESTERN (NEPEAN) Grave Lrp. HIGH COURT AppraL from the Supreme Court of New South Wales. ' On 9th September 1936, Great Western (Nepean) Gravel Ltd. an Alexander Larking entered into an agreement under seal whereh Larking granted to the company an exclusive right for a term fifty years from and including 1st May 1936 to remove sand of or adjoined land owned by Larking. The consideration for the grant was the payment by the company of the sum of £250 and the brought upon or over any of the lands the subject of the agreem the minimum royalty payable to be not less than £300 in any year. It was provided that the royalty should be paid quarterly on the last day of July, October, January and April in each and every year during the term, the first of such payments to be made on 31st July 1936. Certain rights of user of Larking's land were also granted to the company. The agreement was expressed to a licence granted to the company. Among other conditions of agreement it was provided that if default should be made by the licensee, the company, in the payment of any royalty at the ti i and in the manner provided or in the observance or performance by the licensee of any of the terms and conditions and such default should continue for thirty days after any of the quarter days provided for payment thereof, the licensor, Larking, should be at liberty forthwith to determine the agreement and the licence thereby given without notice to the licensee and thereupon to eject the licensee from the premises (clause 7); that the licensee should at its own expense fence a particular area, called the " dumping site," and a passage-way, particularized in the agreement by reference to the annexed sketch, for the purpose of giving the licensor's stock access from the said land to the Nepean river, that such fence should be stock-proof and of specified quality and construction, and should during the term maintain that fencing in good order and condition (clause 12); that the licensee should place and keep in thorough repair portion of an existing fence between Larking's land and that of a neighbour (clause 13) ; that the licensee should at its own expense erect in a good and workmanlike manner and to the satisfaction of * the licensor, a gate as an extension of one of the fences mentioned in clause 12 and should at its own expense during the term keep and maintain the said gate in thorough repair and condition and should at all times, except when opened for the passage of the company's vehicles, keep the gate securely shut and closed so as to prevent Larking's live stock passing through the entrance (clause 15); that OF AUSTRALIA. licensee should at all times erect and keep suitable rails across sting cutting so as to prevent stock coming up from the river he company commenced to take material under this agreement flay or June 1937. Its operations were continued until about er 1939. On 26th October 1939 Larking wrote to the company I dissatisfaction with the manner in which the company carried out its part under the agreement. He complained that yalties had not been punctually paid, that particulars of the terials taken away had not been supplied, that the fences referred ) in clause 12 had not been erected, that the gate and rails referred yin clauses 15 and 16 had not been provided, and that the repairing f the fence referred to in clause 13 had not been attended to. He ined the company to erect the fences, gates and rails, and to the existing fence within fourteen days. The company did t reply to this letter or do anything because of it. Royalty due t the agreement on 31st October 1939 was paid, and accepted L g, on 27th November 1939. On Ist December 1939 g sent a formal notice to the company asserting that it had n a number of its covenants, and requiring it to remedy the es in a manner specified in the words of the agreement. The referred to were those contained in clauses 12, 13, 15 and 'o reply was sent to this notice, nor was anything done by iny because of it. 4th December 1939 the company was put into voluntary on, the resolution reciting that it had been proved to the ction of the meetings of its shareholders that the company d not by reason of its liabilities continue its business, and a was then duly appointed. On 12th December 1939 sing sent to the liquidator a notice purporting to determine the nent under clause 7 thereof, and claiming the possession of the Thereafter he prevented the company's servants from 'access to the works which they had previously been operating. g, on 29th November 1939 and 4th December 1939, lodged s under the Mining Act 1906 (N.S.W.) with the Mining nat Penrith for authorities to enter and prospect for certain als, which substantially amounted to sand and gravel, on, inter land in respect of which he had granted the licence to the by way of statement of claim was commenced by the pany in the equitable jurisdiction of the Supreme Court of New Wales, on 28th December 1939, for injunctions to restrain ng from interfering with the company in the conduct of its H. C. or A. 1940. fend Laskrxo v Great WESTERN (NePEaN) Grave Lop. H.C. oF A. business on the land subject to the licence, and to restrain him from 1940. we LarKING v. GREAT WrstERN (Nerean) Graver L HIGH COURT (1940, : proceeding with his applications under the Mining Act. After an — ex-parte injunction had been granted the parties arranged a modus vivendi pending the hearing of the suit, one term of the arrangement being that the motion to continue the injunction should by consent become a motion for decree. i At the hearing of the motion the real question between the parties : was whether Larking had on 12th December 1939 a present right to determine the licence granted by him. The right was claimed — as arising under clause 7 of the agreement, and the defaults made by the company bringing that clause into operation were claimed _ to be breaches of the terms or conditions contained in clauses 12, 13, 15 and 16. As to clause 16 Roper J. found that the company did erect suitable rails across the cutting referred to so as to prevent stock coming up from the river, and on the evidence his Honour was satisfied that — they were kept there for that purpose and that the company did not break this provision. The other alleged defaults fell under two heads only, as the facts as to the gate referred to in clause 15 and the fence referred to in clause 12 were precisely the same. It was admitted that neither the gate nor the fence was erected, so that the requirements of these clauses had not been carried out. Evidence was given of a conversa- tion between the managing director of the company and Larking, in which Larking is said to have expressly relieved the company of the necessity of erecting the fence and gate. The judge was satisfied that some conversation such as had been deposed to took place, but he was not satisfied that Larking intended to or did relieve the company of these obligations. It was, even on the aecount of the company's witnesses, an informal and inconclusive conversation and his Honour thought that at most Larking allowed the matter to stand for the time being instead of insisting on the immediate construction of the works. The erecting of the fence and gate was only a small job; Larking himself offered in December 1936 to do it at a cost of £21. His Honour held that the work under clauses 12 and 15 should have been done within a reasonable time of the commencement of the company's operations in May or June 1937, and not having been so done a breach of those clauses was effected. The breach was not a continuing breach nor did the obligation to repair give rise to a continuing breach. His Honour found that notwithstanding his complaints, which were principally directed to his stock straying, Larking continued to treat the agreement as subsisting, and by 89 co CLR.) OF AUSTRALIA. E - doing elected not to exercise the right to determine it, consequently he waived his right to determine the agreement. But, apart _ altogether from waiver, Larking lost the right in respect of those breaches because of the length of time which had elapsed between the breach and the reported exercise of the right. _ By the decree of the court it was declared (a) that Larking had waived his rights under the deed to determine the agreement on the that the company had made default in the observance or mance of the terms and conditions of clauses 12 and 15 thereof, (b) that the agreement was a subsisting agreement between the y and Larking at the commencement of the suit, and it was ordered that Larking be restrained from exercising any rights he 'might get as a result of his applications under the Mining Act in 'any manner inconsistent with the rights of the company under the "deed. _ From that decision Larking appealed to the High Court. Further facts appear in the judgments hereunder. Mason K.C. (with him C. M. Collins), for the appellant. By the agreement a licence was granted to the respondent (Woodfall on - Landlord and Tenant, 24th ed. (1939), p. 8); it does not. confer on a 'the respondent a lease for its term of all or any of the lands to which q : 'relates, The law of landlord and tenant does not apply. The -erection of the fence and of the gate and the maintaining of in good order and condition are continuing breaches. The isn imposed upon the respondent by the use of the word maintain was that not only should it erect the fence and gate, but that it should, throughout the term, keep them erected and in good order and condition. The matter depends upon the proper ction of the document under consideration and little, if any, e can be obtained from decided cases. The decision in ens v, Junior Army and Navy Stores Ltd. (1) was based upon L express covenant to erect on or before a specified date buildings isely described and is, therefore, distinguishable from this case. é was not any waiver, by conduct or otherwise, on the part of appellant ; alternatively, there was not any waiver on his part the breach or breaches of the covenant to maintain (Bennett v. ing (2)). The facts that the appellant accepted royalty and : @ continuance of operations under the licence are out- . by the facts that he persistently and continuously com- 'plained to the respondent of the non-erection of the fence and gate, and that the respondent on such occasions promised to attend to (1) (1914) 2 Ch. 516, (2) (1857) 3 C.B.N S. 370 [140 E.R. 784]. VOL, LXIV, 1 H.C. or A. 1940. pene Lanxixa Great Westrnw (Nepean) Graven Lap. H.C. or A. 1940. — LARKING v. Great Western (Nepean) Grave Lrp. HIGH COURT the matter. A waiver must be an intentional act with knowledge; the appellant has not taken up two inconsistent positions (Craine Colonial Mutual Fire Insurance Co. Ltd. (1); affirmed, sub nom, Yorkshire Insurance Co. Ltd. v. Craine (2) ). The facts proved de not, as in Hunter v. Daniel (3), amount to a waiver on the part the appellant. The proposition which the judge of first instan should have propounded for his consideration is as set forth i Bentsen v. Taylor, Sons & Co. [No.2] (4). The appellant was entitled to refrain from exercising his right to rescind the agreement account of a breach by the respondent upon receiving a promise promises from the respondent that it would carry out the obligatio within a reasonable time. The date of the payment of royalty j not important, but it is important to consider in respect of period of time the royalty was paid. The respondent did not required by the agreement place and keep in repair the existing fences; they were not made stock-proof. Weston K.C. (with him O'Sullivan), for the respondent. judge of first instance correctly dealt with the matter of the rep of the existing fences. His finding that there was not any bre of the covenant to place and keep the fences in good repair is abun- dantly supported by the evidence. [He was stopped on this point.] The appellant waived his right to rescind the agreement. is not any evidence that the appellant did anything in the way granting an extension of time to the respondent. icit i agreement. Where there is an obligation to do a thing it must, the absence of a time for performance being specified, be d within a reasonable time. [Dixon J. referred to Morris v. Kennedy (5).] The criteria there shown should have been applied in this case. See also Halsbury's Laws of England, 2nd ed., vol. 7, p. 204, par. 285. The question in this case is not waiver of the obligation to erect a fence but that, there being a breach, the appellant his right to rescind for that breach ; the condition sank to the of a warranty. A precise and authoritative statement of the la (1) (1920) 28 C.L.R. 305, at p. 326. (3) (1845) 4 Ha. 420 (67 E.R. 712). (2) (1922) 2 A.C. 541. (4) (1893) 2 Q.B. 274, at pp. (5) (1896) 2 LR. 247, OF AUSTRALIA. ible to this case is to be found in Stephens v. Junior Army | Navy Stores Ltd. (1). J. referred to Coward v. Gregory (2).] n he accepted payment of the royalty in November 1939 the elected not to rescind the agreement ; he is now estopped : Bower on Estoppel by Representation (1923), p. 251, art. 257. J. referred to Wendt v. Bruce (3) and Mulcahy v. Hoyne neiples are the same in the different departments of the hy. London and North Western Railway Co. (5); Hunter el (6)). If there be a condition precedent to a contract has not been performed and the party not in default has ially enjoyed the benefit of the contract by mere law he to be enabled to treat the condition as a condition entitling 'to rescind (Lilen v. Topp (7); Marsden v. Sambell (8) ). What stitutes a reasonable time must be gathered from the circum- es of the case (Carlton Steamship Co. Ltd. v. Castle Mail Packets (9); Halsbury's Laws of England, 2nd ed., vol. 7, p. 190). K.C., in reply. Sage Jur. adv, vult. e following written judgments were delivered :— H A.C.J. This is an appeal from the judgment of Roper J. [onour decided that an agreement the subject of the proceedings him had not been determined because the appellant had his right to do so. The facts are sufficiently set out in the nt of the primary judge and I need not repeat them in detail. \ it in question constituted a licence to the respondent not a lease or a grant 'of a profit @ prendre for years. Clause 7 le agreement provides that if the respondent made default vr alia in the observance or performance of any of the terms it and the licence. At the hearing before us the con- which became material were clauses 12 and 15. We con- that the finding of Roper J. as to clause 13 should be affirmed. 2 Ch. 516. (6) (1845) 4 Ha., at p. 432 [67 E.R. $66) LR. 2 C.P. 153, at p. 171. san i31) 245. (7) (1851) 6 Ex. 424, at p. 441; [155 E.R. 609, at p. 616]. (8) (1880) 43 L-T. 120, (9) (1898) A.C. 486, at p, 491. H.C. or A. 1940. Ww Larkixe e Great WerstEers (NEPEAN) Graver Lrp. H.C. or A. (QJauses 12 and 15 are as follows :—' 12. The licensee shall at 1940. Ye 'Larkrnc a Grear WesTERN (NEPEAN) * Nepean river and such fencing shall be stock-proof and shall be con HIGH COURT own expense fence the subject land (marked 'dumping site') an shall also fence in the passage-way twenty feet (20') wide leadin from the lane shown in the sketch annexed hereto between the poin B, E, F, G and C, D, I, H shown in the annexed sketch for the pose of giving the said licensor's stock access from the said land to structed of posts twelve feet (12') apart sunk two feet six inch (2' 6") in the ground and standing four feet (4') out of the 1 with three strands of barbed wire of good quality attached properly strained and shall be erected in a good and workm manner and to the satisfaction of the said licensor and shall d the said term at its own cost and expense maintain the said fe in good order and condition. . . . 15. The licensee shall at its own expense erect in a good and workmanlike manner and the satisfaction of the said licensor a gate across the said lane b the points B and J and shall at the like expense during the sai L keep and maintain the said gate in thorough repair and conditio and will keep the said gate at all times (except when opened for th purpose of the passage of the licensee's vehicles) securely shut and closed so as to prevent the said licensor's live stock passmg thro the entrance." 4 It was admitted that there had been breaches of these terms on the part of the respondent and the questions for determination are whether the breaches were continuing or whether the conduct of the appellant was such as to amount to an election on his part not to avoid the licence. The facts relating to the erection of the fence mentioned in clause 12 and the gate mentioned in clause 15 are the same. The obligation to erect the fence was an obligation "to do an act of solitary performance" and to do it within a reasonable time. It is not a continuing covenant and breaches of it are not continuing breaches so that a right of action accrues 'oties quoties when and as often as damage actually arises from breach of it" (Kingdon v. Nottle (1) ). When a reasonable time elapses the righ! and obligations of the parties are crystallized and set for all time. The obligation to maintain the fence and the gate attaches only to the fence and gate when erected. Roper J. considered that it might not have been unreasonable to leave the erection of the fencing until the company commenced its operations on the land in May or June 1937. "The work should, however, have been effected at the latest within a short time of that commencement." The com pany had not erected the fence or gate before the suit was brought. (1) (1815) 4 M. & S. 53, at p. 57 [105 E.R. 755, at p. 756). OF AUSTRALIA. e with the learned judge in thinking that there was no express er nor was time given within which to carry out the work. I m of opinion that the conduct of the appellant showed that he was "adhering to and insisting upon the agreement" (Lamare v. (1)). His acceptance of royalties under the agreement for he period subsequent to the lapse of reasonable time was an 'unequivocal act " (Abram Steamship Co. Ltd. v. Westville Shipping o. Lid. (2)), and he thus elected not to avoid the agreement es v. Young (3); Croft v. Lumley (A) ). appeal should be dismissed. EJ. Appeal from 'a decree of the Supreme Court of New Wales in Equity whereby it was declared that the appellant d waived his right under an agreement under seal dated 9th nber 1936 to determine the agreement on the grounds that respondent had made default in the observance and performance the terms and conditions of clauses 12 and 15 thereof. The e also justified his determination of the agreement under 13 and 16 thereof, but the trial judge held that no default been established under either of these clauses, and it is enough that this conclusion ought not to be disturbed. the agreement referred to, the appellant (called the licensor) ited to the respondent (called the licensee) the exclusive right a period of fifty years to remove sand and/or gravel from the d of the Nepean river where the bed of the river formed portion or adjoined the land of the licensor as shown on a sketch annexed agreement. The licensee was to pay the licensor certain mentioned in the agreement. The 12th clause of the ement provided that the licensee would at its own expense e what was referred to as the " dumping site " and also a passage- twenty feet wide mentioned in the agreement for the purpose siving the licensor's stock access from the appellant's land to the ean river, and would, during the term of the licence, at its own and expense, maintain the said fences in good order and con- 'The fifteenth clause of the agreement provided that the e would at its own expense erect in a good and workmanlike and to the satisfaction of the licensor a gate across a lane een certain defined points and at the like expense during the term keep and maintain the gate in thorough repair and con- n and would keep the gate at all times (except when opened tig LR. 6 HLL, 414, at p. 422. (4) (1858) 6 H.L.C. 672, at p. 705 1923) A.C. 7 p. 779. [10 E.R, 1459, at p. 1472}. 2, at p. 663. H. C. oF A. 1940, se Larkixa Great W2sTERN ( NEPEAN) Graven Lrp. Rich ACJ. H. C. of A. 1940. Cay LaRKING WassreRN (Nereay) Graver Lrp. HIGH COURT for the purpose of the passage of the licensee's vehicles) se shut and closed so as to prevent the licensor's live stock p; through the entrance. The licensee commenced to take gravel and sand under this ag ment in May or June 1937. Neither the fence nor the gate requ by clauses 12 and 15 respectively was ever erected. The clause of the agreement provided that if default should be the licensee in payment of royalties or in the observance or contained, and such default should "continue for the space thirty days after any of the quarter days provided for paymer agreement described. Towards the end of 1939, the appellant expressed dissatis| with the manner in which the respondent had carried out its of the agreement and required it to erect the fences and gates ace ing to the agreement. But the respondent did nothing, a December 1939 the appellant sent a formal notice to the respond asserting that it had broken a number of its covenants (inch those contained in clauses 12 and 15) and requiring it to re the breaches. Again nothing was done. The respondent comp went into liquidation in December 1939, and on the twelfth that month notice was given to the liquidator purporting to mine the agreement under clause 7 thereof and claiming p appellant prevented the respondent and its servants having ace: to the premises the subject of the agreement. The main question for consideration is whether the covenants erect fences contained in clause 12 and to erect a gate contained clause 15 were such that each covenant could only be broken " for all" or whether the covenants were such that a breach of covenant was of a continuing nature. In the latter case, an which affirmed the existence of a tenancy or an agreement only waive a forfeiture down to the time of such affirmance. question depends upon the proper construction of the agreem The learned judge was of opinion that the breach of the coven to erect fences and a gate were not of a continuing nature an OF AUSTRALIA. | was completely and effectively broken "once for all" when time for doing the work in accordance with the agreement lapsed, as no time was mentioned, was a reasonable time from the commencement of the agreement. For example, there can only be ne breach of a covenant to put premises in good and tenantable ir (See Coward v. Gregory (1); Morris v. Kennedy (2) ; Stephens Junior Army and Navy Stores Ltd. (3)); whilst in covenants to e and keep in repair, to insure, or to cultivate, the breach is of it nature (Doe d. Baker v. Jones (4); Doe d. Muston in (5) ; Coatsworth v. Johnson (6) ). Moreover, the case of ephens v. Junior Army and Navy Stores Ltd. (3) makes it clear at the covenants in the agreement to maintain the fences and gate ood repair and condition imported no obligation to erect them had no effect upon the waiver of a forfeiture for not building or recting pursuant to the express terms of an agreement. n my judgment, the learned judge was right in his construction of the present agreement. It required a definite act, namely, the rection of the fences and the gate at specified points and, in the of the fences, of a particular construction, It also required the rection for particular purposes, namely, the access of the appellant's tock to the river and to prevent them straying. All this points to 'obligation that should be performed completely and effectively thin a limited time, which, as the agreement is silent, is within a asonable time having regard to all the circumstances of the case. f was not necessary," said the learned judge, "to decide with exactness when default under these clauses" (12 and 15) yecurred, because it is obvious that there had clearly been such fault by the end of the year 1937." That is a conclusion of fact cannot be disturbed. But then waiver of the right under jause 7 thereof is plainly established. The appellant knew that he fences and the gate had not been erected, yet he allowed opera- under the agreement to proceed until October 1939 and accepted les up to 31st October 1939. The appellant stood to the nent and received benefits under it. He thereby affirmed the and waived his right to determine it for the breach by e appeal should be dismissed. x J. The question in this appeal is whether a licence granted the appellant to the respondent company for the use of his es has been determined for breach of condition or, on the 1) (1866) L.R. 2 C.P. 153 (4) (1850) 5 Ex. 498 [155 E.R. 218). 2) (1896) 2 TR. 247, (5) (1845) 6 Q.B. 953 [115 E.R. 359]. (1914) 2 Ch. 516, (6) (1886) 54 LT. 520, H. C. or A. 1940. Ww Lanxrye a Great WESTERN (NePEaN) Graver Lrp. Starke J. H.C. oF A. 1940. —) LarKixe ». Gear WrsrErn (NEPEAN) Graven Lrp. Dixon J. HIGH COURT 940, other hand, he has waived his right to determine the licence for such breach. if The appellant is the owner of grazing land at Penrith, which adjoins the bed of the Nepean river. His boundary is the high ban which forms the edge of his land. Below the bank is the bed of river containing quantities of sand and gravel. The respon company desired to have access to the bed of the river for the purpos of winning gravel and sand, and also of establishing a crushing pla close by, and obtaining a dumping site. An agreement under was entered into between the appellant, who was called the licen and the respondent company, which was called the licensee, agreement witnessed that, in consideration of £250 paid to the appel lant by the respondent company, it had been agreed that the former should grant to the latter the exclusive right for a period of fifty years to remove sand and gravel from the bed of the Nepean river where the bed of the river forms part of or adjoins the land of the appellant as shown ina sketch plan. In fact none of the appellant's land forms part of the bed of the river whence the material is to b taken. ; The agreement goes on to provide that the respondent company shall have the following rights :—(1) A right, in common with the appellant, of access from the public highway to the river bank by means of a defined way or passage over his land. (2) A right to" maintain a crushing plant on part of the appellant's land consisting of a strip about 100 feet wide along the high bank overhanging the bed of the river. (3) A right to use the strip of land for storing and transporting metal and for other purposes connected with winning it. Next he provided that the respondent company should pay a royalty of 23d. per ton upon gravel, metal or sand taken from the | river bed fronting the appellant's land and upon materials taken over his land; a minimum of £300 per annum is fixed, and the royalty is made payable quarterly. i As the appellant used his land for grazing live stock, which watered at the river, it was necessary to provide a means by which his beasts could reach the water and return. Accordingly the agreement reserves to the appellant the right to use the strip of land for grazing and to obtain access to the river across that strip. The access is to be along a lane or passage twenty feet wide shown on the sketch — plan. The plan shows on part of the strip on the high bank a dumping site, of which the agreement gives the respondent company the sole right of user for the purpose of storing sand, gravel and metal. The lane goes round two sides of the dumping site to the ; edge of the bank and there the respondent company was required tee OLR.) OF AUSTRALIA. ,make a cutting so that the stock could descend to the bed of the river. The lane passes between the dumping site and the common y of the appellant and his neighbour, where a fence stood. the public road an old private lane came right down the centre | the appellant's property to the river bank, and this lane passed parently on the other side of the place set apart for the dumping site. The arrangement was that a gate should be put across it at the dumping site, which would be fenced off, so that the cattle would turn and go round the dumping site between it and the neighbouring operty, down the cutting to the bed of the river, and thence to ro for the respondent company's constructing and maintaining e cutting. It also contained a condition that, if default should be e by the respondent company in payment of the royalty or in observance or performance of any of the terms and conditions 1 the part of the respondent company and such default should inue for thirty days after any of the quarter days provided for payment thereof, the appellant should be at liberty forthwith to e the agreement and the licence thereby given without and thereupon to eject the respondent company from the thereinbefore described. 'The material "terms and conditions" are these :—Clause 12 ides that the respondent company should at its own expense the subject land (marked " dumping site") and should also in the passage-way twenty feet wide leading from the lane, in the sketch annexed to the agreement, between points 'marked thereon, for the purpose of giving the appellant's stock ess from the land to the Nepean river and that such fencing be stock-proof and should be constructed in a specified way that the respondent company should, during the term, at its own cost and expense maintain the said fences in good order and condition ; clause 13 provided that the respondent company should place and keep in thorough repair the existing fences bounding @ proposed passage and the adjoining land of the appellant's between certain points ; clause 14 required the respondent y to make the cutting at the end of the proposed passage in to permit the appellant's stock to go down to the edge of the ; clause 15 provided that the respondent company should at ; own expense erect in a good and workmanlike manner and to he satisfaction of the appellant a gate across the lane already at a point shown in the sketch as the opposite corner of dumping site. The clause required the respondent company to eep and maintain the gate in thorough repair and condition and to H.C or A. 1940. co LaRKING v. Great WESTERN (NgPEAN) Grave. Lrp. Dixon J. H. ©. or A. 1940, ad LarkIxe v. GREAT WestERN (NEPEAN) Graves Lap. Dixon J. HIGH COURT keep the gate shut so as to prevent the appellant's live stock from passing through the entrance. i The respondent company made the cutting but never construe the gate nor fenced the lane or passage round the dumping site the cutting. Some repairs were done to the fence between appellant's land and his neighbour's, and Roper J., from whe decree the appeal is brought, held that clause 13 had been fulfil During the hearing of this appeal this court intimated its opini that the finding or conclusion ought not to be disturbed. But the breach by the respondent company of clauses 12 and 15 is undisputed. The question is whether the appellant can rely on it as a breach of condition for which the agreement or licence forfeited. or, on the contrary, has waived the breach or breaches as a ground of forfeiting the licence or terminating the ag The facts affecting this question were investigated in some at the hearing of the suit but they can now be stated briefly. The licence or agreement took effect on Ist May 1936. respondent company began operations about a year later a exercised the licence without interruption until, on 4th December 1939, a voluntary winding up commenced. The agreement appear to be a valuable asset. It cannot be assigned without the appellant's consent, but he cannot withhold his consent to an assignment to a "'espectable responsible financial person or company." The liquidator accordingly claims that the agreement subsists and has not been determined and is not liable to forfeiture. From the beginning the respondent company does not seem to have won enough gravel, sand or metal to take the amount of royalty payable to the appellant beyond the minimum sum of £75 per quarter. The — quarterly payments were not made punctually, but on 23rd Novem- ber 1939 a payment of £75 was made in respect of the quarter ending on 31st October 1939, and there were no other arrears. The next payment would fall due on 31st January 1940, but in the meantime the suit was brought. On 26th October 1939 the appellant made a request in writing that clauses 12, 13, 15 and 16 of the agreement should be performed within fourteen days, on pain of his exercising his rights under the agreement. On Ist December the appellant gave the respondent company a formal notice requiring it to remedy breaches which he specified. On 12th December he gave notice of determination of the agreement, and he then locked the gates and denied the company's servants any further access to the river bed through his land. agi The respondent company says that he was not in a position to take this course because, by the acceptance of payments of royalty Rj OF AUSTRALIA. 235 by a long course of conduct, he had elected to affirm the agree- 4. © oF 4 notwithstanding the company's failure to perform the con- ap of the licence. Sines this the appellant replies (1) that the covenants in question 'not capable of a breach " once for all" but involve a continuing yonr*", luty to fence and therefore that the continuing breach extended (NzPzas) d 31st October 1939, after which date there was clearly no — er waiver ; (2) that in any case upon a proper understanding — Dixon J. e conduct of the parties, the period for performance, for which agreement specified no definite time, was kept open, so that no initive breach occurred until after 31st October 1939; (3) that, e the forfeiture of a lease, waiver of a right to bring to an end nent such as the present requires an actual intention to that acceptance of the royalties with knowledge of the a comparison of the findings made by Roper J. vith a body icting evidence, it seems that we ought to take the facts to that, before the company actually began working under the ce, the appellant offered to do the fencing at a price he named, from time to time he complained of the absence of the fences e his stock wandered, that at the end of 1938 he complained > manager, "in an informal and inconclusive conversation," it, instead of insisting upon the immediate construction of the and gates, he allowed the matter to stand for the time being. e was no reason for constructing the gate and fences until the lent began actually to work in the river bed and upon the on the high bank. The purpose of the fences was to provide or the appellant's cattle while operations were going on; and to xclude his beasts needlessly from the site before work began would been a disadvantage to the appellant. It appears that the pany's use of the place for actual work began about May or June From that time until December 1939 is about two and one- years. During the period the appellant clearly had a right to lain of the respondent company's delay in performing its s. It is not easy to be sure what actually passed between ppellant and the respondent company, but, upon the findings of the learned judge, the best interpretation of the discordant lence adduced appears to be that on one side there were requests performance of the covenants and on the other delay, but no | to perform, and statements that the absence of the particular Was not the cause of the cattle wandering. H.C. of A. 1940. —) LarKine a Great WESTERN (NerEaw) Graver Lrp Dixon J. HIGH COURT [1940. Upon these facts, the first question for consideration is whether the covenants contained in clauses 12 and 15 operated to impose a continuing duty upon the respondent company so that a failure to fence involved new breaches for every day of default, thus including the period after 31st October 1939. If a covenantor undertakes that he will do a definite act and omits to do it within the time allowed for the purpose, he has broken his covenant finally and his continued failure to do the act is nothing but a failure to remedy his past breach — and not the commission of any further breach of his covenant. His _ duty is not considered as persisting and, so to speak, being for ever _ renewed until he actually does that which he promised. On the other hand, if his covenant is to maintain a state or condition of affairs, as, for instance, maintaining a building in repair, keeping the insurance of a life on foot, or affording a particular kind of lateral or vertical support to a tenement, then a further breach arises — in every successive moment of time during which the state or con- dition is not as promised, during which, to pursue the examples, the building is out of repair, the life uninsured, or the particular support unprovided. The distinction may be difficult of application in a given case, but it must be regarded as one depending upon the meaning of the — covenant. It is well illusteated by the construction given to the ordinary covenant that premises will be insured and kept insured against fire. Such a covenant is interpreted as imposing a. continuing obligation to see that the premises are insured, so that the covenant — cannot be broken once for all, but, on the contrary, failure to insure involves a continuing breach until the omission is made good. But in Doe d. Flower v. Peck (1), speaking of such a covenant in a lease that had been assigned with the covenant unperformed, Parke B. said :—" If this could be construed to be a covenant by the lessee to effect one policy of assurance immediately, and afterwards that he and his assigns should keep that particular policy on foot, by con- tinuing to pay the annual premiums on that policy, the assignee would not have been guilty of any breach of covenant, if the lessee had never insured, for the policy never could have existed, which the assignee was to continue ; and the distress for rent would have been a waiver of the breach by the original lessee. In such a case the lessor of the plaintiff could not have recovered. But if the covenant mean that the lessee and his assigns shall always keep the premises insured by some policy or another, then it is broken if they are unin- sured at any one time ; there is a continuing breach for any portion' — of time that they remain uninsured ; and we are of opinion that this * (2) (1830) 1 B. & Ad. 428 [109 E.R. 847]. i are 64.C.L.R.) OF AUSTRALIA. is the true construction of the covenant: it is that which would have been put upon it if an action of covenant had been brought ; and it makes no difference that the consequence of the breach of it is a forfeiture " (1). _ The same learned judge gave a like construction to a covenant by a debtor to insure or cause to be insured his life in one or other of the respectable offices in London or Westminster and to continue to keep the life so insured. He said: " We agree in the construction . . . that the defendant's covenant was not to keep alive the original policy, which covenant would have been broken once for all by neglecting to insure forthwith, but that there is a continuing covenant to keep insured by some policy in some office" (Hyde v. Watts (2) ). pang A covenant by a lessor to put the demised premises in repair is broken once for all if a reasonable time for putting the. premises in repair elapses without his doing so (Coward v. Gregory (3), per Willes J.), But a lessee's covenant to keep them in repair is con- tinuing. If the covenant names a time for the doing or completion of a definite act, it is clear that failure to do the act within the time involves a breach once for all, and, as appears from the foregoing statement of Wiles J., the same conclusion will follow where no time is limited but a specified thing is to be done and a reasonable time elapses for the performance of the covenant: Cp., further, Doe d. Baker v. Jones (4). In Morris v. Kennedy (5), where the principle was applied to a covenant in a building lease to construct within '4 specified time a new street bounding the demised land, Holmes J. in a very clear explanation of the reasons for holding that a final breach had occurred, referred to covenants depending on an implica- tion that the obligation should be fulfilled within a reasonable time. He said :—"I am of opinion, that the case before us depends upon whether the covenant sued on was broken finally and once for all before the assignment of the leasehold premises to the plaintiff. The covenantor undertakes by it that he will within one year from the date of the lease at his own cost and charges, make and construct and completely finish the street referred to. It would be difficult to suggest how finality could be more exhaustively expressed than by the three verbs, and the adverb, that occur in the portion of the covenant I have read. Then consider the limit of time. Even if (1) (1830) 1B, & Ad., at p. 438 (109 (3) (1866) L.R. 2 C.P., at p. 171. ER., at p. 850). (4) (1850) 5 Ex., at p. 504 [155 E.R. (2) (1843) hie & W. 254, at p. 270 'at p. 220]. {152 E.R, 1193, at p. 1200! (5) (1896) 2 LR. 247. ene H. C. or A. 1940. 2D Larkixo ' Great WESTERN (NePEaN) Graver Lro. Dixon J H. C. or A. 1940. Ye LARKING a GREAT WESTERN (Nerzay) Graver Lrp. Dixon J. HIGH COURT this were absent, it would occur to me that the language would that upon the expiration of a reasonable time the rights and liabilitic of the parties were to be ascertained once for all; but the fixing 0 the definite period of a year strengthens the argument for thi construction. What is there to suggest that if the lessor had, in words of the covenant, made, constructed, and completely fi the street within the time mentioned, he would have been under the leasehold premises were to lose entirely the advantages of proposed street ?"" (1). In covenants to build and then to keep the building in repair, obligation of the latter part of the covenant arises for performance only when the former is fulfilled and accordingly the contin nature of a covenant to repair cannot be used to avoid any of fl of a breach once for all (Stephens v. Junior Army and Navy Ltd. (2) ). : The distinction between a covenant to do a definite act capable only of a breach once for all and a continuing covenant has con quences not only in relation to waiver but also in the measure of damage, in the effect of lapse of time under statutes of limitati and, where the covenant runs with the land, in the liability of an assignee to sue or be sued for further breaches. 4 It vemains to apply these considerations to the interpretation the covenants contained in clauses 12 and 15 of the agree Under clause 12, the licensee, that is the respondent company, "fence the land": such fence must be stock-proof and erected in a form specified and to the satisfaction of the licensor, the appellant. All this reads like an immediate obligation to perform a definite or series of acts. The covenant goes on to say that, during the te the company must at its own cost and expense maintain the sa fences in good order and condition. Again} this form of expre looks as if a further duty, one of maintenance, is to attach wl the fence is erected. It may be that, under this latter part of 6th ed. (1924), at pp. 251, 252, and note at pp. 909, 910. even so, it does not mean that the duty to fence in the first continues indefinitely until actually fulfilled. It means that every time the fence falls into disrepair or is destroyed, then, within (1) (1896) 2 T. R., at pp. 252, 253, (2) (1914) 2 Ch. 516. OF AUSTRALIA. e time, it must be restored. It still remains true that under earlier part of the clause a fence must be erected before the r part has anything upon which to operate. The erection of nee is a definite act which must be done within a reasonable , and failure to do it is a breach once for all. The failure to within a reasonable time would entitle the licensor, the appel- t, not simply to damages for delay, on the footing that the duty ined and might or would be performed by the company. It entitle the appellant to damages measured by the loss arising m his being deprived of a fence, and the damages would or might clude the cost to him of placing the fence there himself. ise 15 appears to me to bear the same interpretation. The to grect a gate within a reasonable time involved a breach all. If, therefore, a reasonable time elapsed and there was rangement or request by which performance was postponed or 'open, a definitive breach arose, and any unequivocal act recog- n the existence of the agreement after that time would amount )a waiver. On the facts, I am unable to agree that time for mance was given so that the obligation of the covenant was open and unbroken, No doubt the appellant renewed his for performance and expected that in the end fences would ed by the company. But he never meant to enlarge for performance of the covenant. The situation was that xcused delay on the side of the company and, on the appel- side, toleration accompanied by recurrent complaints. After 7 there was an immediate duty on the part of the respondent iy to fence and a reasonable time for performance expired ug before the end of that year. he only remaining question is whether the appellant's acts ounted to waiver. In considering this question it must be remem- tt we are not dealing with a lease. There is no estate or t in land. The sole user of the dumping site does not, as I stand the agreement, mean exclusive possession on the part of mmpany for all purposes of a defined area of land. It therefore s not amount to a demise of the dumping site. There is not a 'of a profit & prendre for a term of years. For the sand, gravel parcel of the appellant's land. It is a licence to transport gravel and stone over the appellant's land and to use part land for crushing and as a dumping site. The distinction ome importance in two respects. If there had been a lease corporeal or incorporeal interest in land, it would have been sary for the appellant, before he re-entered, to give notice to H. C. or A. 1940. —— LARKING '. Great WesTERN (NePEax) Gravet Lap. Dixon J. H.C. of A. 1940, Ye Lanxese v. GREAT Westerx (Nureax) Graven Lrp. Dixon J. HIGH COURT the company specifying the breaches complained of and requiring the company to remedy such breaches: See sec. 129 of the Con. veyancing Act 1919-1932 (N.S.W.). In the second place, acceptance of the royalty as rent accruing due after breach of condition would have been necessarily fatal as a waiver of the forfeiture. Rent issues out of the land demised and — is an incident of the tenure. To receive rent in respect of a peri later than the breach of condition, with notice of the breach, necessarily a waiver of the forfeiture because it recognizes that th tenure subsisted notwithstanding the liability to forfeiture. If money is received in respect of the tenant's use of the land but in its quality as rent, the forfeiture is not waived, as, for insta when it is paid and received as compensation to the landlord. A tonnage rate payable under an agreement like the present stand in an analagous position, but it is not the same thing. ever, I do not think that the appellant can escape from the position that, by allowing the respondent company to go on for over years and by receiving royalties in respect of that period, he unequivocally intimated an intention that the agreement should b considered as subsisting after the reasonable time had lay within which the company was bound to fulfil clauses 12 and 15 and notwithstanding that to his knowledge the company had no done so. That amounted to a waiver of the right to determine the agreement : See Wendt v. Bruce (1). I am therefore of opinion that the appeal should be dismissed. Appeal dismissed with costs. Solicitors for the appellant, Harold T. Morgan & Sons. Solicitor for the respondent, Arthur J. P. Hall. J. Be. (1) (1931) 45 C.L.R. 245, i