WILCOX and ORS v RICHARDSON and ORS [1997] NSWCA 342

WILCOX and ORS v RICHARDSON and ORS SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL

MEAGHER, HANDLEY and POWELL JJA 1-3 April 1997, 31 July 1997 [1997] NSWCA 342

leases — subject matter of — Wheeldon v Burrows (1879) 12 Ch D 31 — test "reasonably necessary for the enjoyment of the land' — implied terms for exclusive possession — Codelfa Constructions Pty Ltd v State Rail Authority (1982) 149 CLR 337.

FACTS

The Crown granted Special Leases over two lots, 276-277 to Mr and Mrs Richardson as joint tenants. In 1991, Mr and Mrs J Richardson agreed orally to sub-lease part of lot 276 to Mr R Richardson and his "partner" Miss Smith. In 1993 a formal sub-lease was executed. In 1994, Mr R Richardson and Miss Smith executed an agreement for sale of the business they had been conducting on the sub-demised premises; an assignment of sub-lease and an option to purchase a 75% interest in both lots by | March 1995. The main question on appeal was what were the sub-demised premises and what easements of a Wheeldon v Burrows type existed.

HELD

1. The fact that two businesses were conducted by two different people simultaneously on the ground floor of the premises puts paid to any suggestion that the sub-lease was a demise of the whole of Lot 276.

2. The onus to prove exclusive possession was on the appellant, who having failed to discharge that onus must abide the result that a large part of the building was used in common by the proprietors of the two shops.

3. The appellants have proved they have rights of a Wheeldon v Burrows (1879) 12 Ch D 31 kind over additional areas ie a quasi easement of a "continuous and apparent" nature which was "reasonably necessary" rather than "essential" for the enjoyment of the land granted by the sub-lease.

4. Per Handley JA: The rule in Wheeldon v Burrows illustrates the relevance of surrounding circumstances to the implication of terms and reflects the working out of the general principle "that a grantor shall not derogate from his grant".