SAADE v VERGADOS [1996] NSWCA 463

SAADE v VERGADOS

SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL EQUITY DIVISION

HANDLEY JA, SANTOW and SIMos AJJA

15 October 1996, 15 October 1996

[1996] NSWCA 463

REAL PROPERTY — LEASE — ELECTION — UNEQUIVOCAL CONDUCT

The appellants were the former tenants of premises that were destroyed by fire. The respondent owners submitted plans to the Council for development consent for reconstruction of the building. Consent was granted subject to the carrying out of additional work. The lease provided that where the premises were destroyed by fire the lessor could terminate the lease, or rebuild and continue the lease. The respondents terminated the lease as compliance with the Council's conditions would involve extra expense that would need to be passed on in the rent. At trial the appellants argued that the application for development consent was conduct under the relevant clause in the lease, and evidenced as unequivocal election to continue the lease. The Judge found that there had been no such election. On appeal:

HELD, dismissing the appeal: (1) There had been no conduct that constituted an unequivocal election to continue the lease: Sargent v ASL Developments Ltd (1974) 131 CLR 634; Immer (No 145) Pty Ltd v Uniting Church in Australia Property Trust (NSW) (1993) 182 CLR 26 followed; (2) There were no incontrovertible facts establishing that the Judge's findings of fact were glaringly improbable: Devries v Australian National Railways Commission (1992) 177 CLR 472 followed.

Handley JA Ex tempore

This is an appeal by a former tenant of premises at Warilla from a decision of Cohen J who held that the lease had been validly terminated.

The appellant became tenant of the property by assignment from the contractual tenant in June 1991. On 3 December 1992 the premises were destroyed by fire. Following the fire the landlords caused fresh building plans to be prepared providing for the reconstruction of the building that had been destroyed. These were submitted to the Shellharbour Council at some stage in December 1992.