Monk & Anor v Austin & Anor [2007] NSWSC 1088

New South Wales Supreme Court

CITATION : Monk & Anor v Austin & Anor [2007] NSWSC 1088

HEARING DATE(S) : 17, 18 and 21 September 2007

JUDGMENT DATE : 21 September 2007

JURISDICTION : Equity Division

JUDGMENT OF : Palmer J

EX TEMPORE JUDGMENT DATE : 21 September 2007

DECISION : Injunction granted.

CATCHWORDS : INTERLOCUTORY INJUNCTION – BALANCE OF CONVENIENCE – Farming and grazing property – defendants terminate lease and enter property and begin cararying out work – where balance of convenience lies.

Robert James Monk – First Plaintiff PARTIES : Eileen Patricia Monk – Second Plaintiff John Austin – First Defendant Elizabeth Jean Austin – Second Defendant

FILE NUMBER(S) : SC 4570/07

COUNSEL : T.D.F. Hughes – Plaintiffs M.K. Scott – Defendants

SOLICITORS : Lumleys Solicitors – Plaintiffs Mackenzie & Vardanega – Defendants

4570/07 Monk and Anor v Austin and Anor

JUDGMENT – Ex tempore 21 September, 2007

1 The Plaintiffs are the lessees of two large properties pursuant to leases from the Defendants which commenced on 1 July 2006. The term of the leases is four years and nine months and there are options to renew for a similar term. 2 By notices given to the Plaintiffs on 21 April 2007, the Defendants purported to terminate the leases for non-payment of rent. The Plaintiffs disputed the validity of the notices and remained in occupation of the properties. 3 By further notice given on 21 August 2007 the Defendants purported to terminate the leases for breaches of covenants to control and suppress noxious weeds. The Plaintiffs contest the validity of those notices and of the purported termination of the leases. 4 On or about 11 September 2007 the Defendants re-entered the properties, or a substantial part of them, and commenced to do very substantial work, principally preparing the land for tomato growing. The Plaintiffs had been using the properties for grazing sheep and rice growing. 5 On 31 March 2007, I granted leave to the Plaintiffs to serve on short notice a Summons seeking declarations that the leases had not been validly terminated, and damages for breach of the Defendants' covenants for quiet enjoyment. The Plaintiffs also sought interlocutory injunctions restraining the Defendants from any further interference with their full use and enjoyment of the properties. 6 The matter has come before me today for a contested interlocutory hearing. Both sides have filed evidence and, in accordance with previous directions, they have provided me with written submissions. 7 There is no dispute that the Plaintiffs' case raises serious questions of fact and law to be tried. As the position of both parties depends very much on seasonal considerations and the practicalities of farming and grazing, I have offered to find the first available date for the final hearing of all issues, save as to quantum of damages, should liability for damages be established. I have offered the parties a three day hearing in the week commencing 22 October 2007. 8 The issue which has been debated before me today is what, if any, interlocutory orders should be made having regard to the balance of convenience pending the final hearing. 9 There has been considerable discussion between Counsel and myself in an endeavour to work out a regime, pending final hearing, which will disadvantage the parties the least. Unfortunately, the parties have been unable to agree, so that I must determine now where the balance of convenience lies and what must be done to accommodate it. 10 The matter comes before me on the last day of my period as Duty Judge in a heavy list. If I am not to make some orders today, the parties, who have come a considerable distance to Sydney, will be put to further trouble and expense and will have to come again before another Duty Judge. 11 In these circumstances, I will give my reasons for my conclusions as briefly as I can, noting that I have read all the affidavits relied upon by the parties and the written submissions which each side has furnished. I have also had the benefit of some truncated oral submissions. 12 The Plaintiffs run sheep on the properties. The Defendants say that parts of the properties are infested with noxious weed which can be carried by the sheep to non-infested parts of the properties. The Defendants say the sheep should not be removed from the paddock in which they are already located, which already has some weed infestation. 13 On the other hand, the Plaintiffs say there will not be enough feed for the sheep in the paddock, and that they need the whole of the property to be available to the sheep. They say that the noxious weed has been ploughed in and there is little or no practical risk of the sheep transporting the seed around the property. The evidence so far satisfies me that the damage to the property from infestation of Bathurst Burr and other noxious weeds can be very substantial indeed. There has been a history of infestation in this area over the years. 14 In my opinion, the balance of convenience requires that the sheep not be permitted to graze generally over the properties but should be kept in the paddock in which they are located, unless they are agisted. I am influenced by the fact that the Defendants, in order to assist the Plaintiffs in providing feed, offered to waive any admission that might otherwise arise from the banking by the Plaintiffs of a cheque in the sum of $27,000 from the Defendants, being a return of rent provided by the Plaintiffs. I will not grant any injunctive relief to the Plaintiffs unless they undertake to the Court to confine the sheep to the paddock in which they are presently located. 15 The Defendants have prepared one hundred acres of the properties for planting of tomatoes. The extent of this work would largely be wasted if the tomatoes were not planted in time and maintained sufficiently to be grown successfully. The Defendants say, however, that 100 acres under plantation is not commercially viable and they should not be restrained from cultivating a larger area. They say they have entered into a joint venture agreement with a third party for the development of the crop and its processing. 16 This is certainly a consideration, but I take into account the fact that the Defendants entered onto the property and began cultivation of tomatoes in the full knowledge of the history of the dispute between the parties as to whether or not the leases had been the validly terminated. Further, the Defendants had on prior occasions advised the Plaintiffs that if the Plaintiffs did not vacate the properties, the Defendants would commence proceedings for ejectment. 17 The Defendants obviously decided they would adopt the remedy of self help by entering the property rather than commencing proceedings for ejectment. It seems to me that the Defendants took a calculated risk in doing so and should not be allowed to have the benefit of that risk beyond the extent of preserving what has already been done so that it is not completely wasted. 18 I will therefore restrain the Defendants from doing further work on the properties to enlarge the area prepared for the growing of tomatoes. The orders will not, of course, prevent the Defendant from actually planting and maintaining tomatoes in that plot of land which has been prepared for their cultivation. In refraining from granting the injunction to restrain this work I am influenced by the acknowledgement of the Defendants that, if they proceed with the planting and are ultimately unsuccessful in these proceedings, the nett profits of the tomato crop will be accountable to the Plaintiffs. If the area already prepared for cultivation is not sufficiently large to provide the economic venture, that is unfortunate for the Defendants. But I will not permit them to encroach further on the use by the Plaintiffs of the properties. 19 Both the Plaintiffs and the Defendants claim to be presently entitled to water rights affecting the properties. The Plaintiffs wish to be able to sell some of those water rights. The Defendants say all the water rights are required for use on the tomatoes and that I should not permit the Plaintiffs to deal with them. 20 I will restrain the Defendants from dealing with or disposing of any water rights affecting the properties. In order to protect the Defendants correspondingly against any disposal of the water rights by the Plaintiffs, I will not grant any injunctive relieve to them in respect of water rights unless they give an undertaking to the Court in the same terms as the order restraining the Defendants. 21 The orders and undertakings to which I have referred will be until further order of the Court, with liberty to apply on 24 hours' notice. I will fix this matter for hearing on a final basis on 22 October 2007 for three days. There will be a pre-trial directions hearing notified to the parties in due course at 9:30am on a day to be fixed. I order the costs of this motion today be costs in the cause. 22 I will not formally make any orders this afternoon because orders restraining the Defendants are conditional upon undertakings which are to be given to the Court. The matter will stand in the list to see what can be done this afternoon. – oOo –