NATIONAL MUTUAL LIFE NOMINEES LTD v TRAVELLERS (NSW) PTY LTD [1996] NSWCA 384

NATIONAL MUTUAL LIFE NOMINEES LTD v TRAVELLERS (NSW) PTY LTD

SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL

MAHONEY ACJ, CLARKE and SHELLER JJA 19 September 1996, 4 October 1996 [1996] NSWCA 384

LANDLORD AND TENANT — unregistered lease — third party takes over possession of premises — whether this constitutes abandonment — tenancy at will — whether occupation fee payable by third party Konica Machines Australia Pty Ltd v Tizene Pty Ltd (1992) 26 NSWLR 687

The appellant (NML) was the registered proprietor of property of which it agreed to grant a lease to The Travellers Organisation Pty Ltd (TOL). The agreement was by way of a deed dated 19 February 1990, and the term of the lease was to be for a period of six years commencing on 29 August 1990. TOL entered into occupation, although the lease was never registered. TOL's business was subsequently taken over by a company known as The Travellers Corporation Pty Ltd (TCL), and the respondent (TPL) took possession of the premises from TCL on or about 7 February 1992.

On 7 July 1992, NML and TPL agreed that TPL should pay an occupation fee for the following seven weeks. In addition, NML argued that TPL had been a tenant at will since taking possession in February, and claimed an occupation fee for those preceding five months. The appellant relied on the principle stated by Dixon J in Turner v York Motors Pty Ltd (1951) 85 CLR 55 to the effect that it would not be inconsistent for an intending tenant holding at will to pay compensation to the owner for the use and occupation of the land.

Giles J found that there was no implied tenancy at will and that the principle in Turner did not apply. NML appealed, arguing that it was intending to sub-let the premises on TOL's behalf, and that consequently it was entitled to recover an occupation fee from TPL.