New South Wales Supreme Court CITATION : Willyama Broken Hill Motor Inn Pty Ltd [2006] NSWSC 693 HEARING DATE(S) : 06/07/06 JUDGMENT OF : Gzell J EX TEMPORE JUDGMENT DATE : 07/06/2006 DECISION : Application dismissed with costs. CATCHWORDS : PROCEDURE - Injunctions - Whether statement of no present intention to take a step but that if at some future time thought desirable, assertion of right to take such steps as thought appropriate is sufficient to ground an interlocutory quia timet injunction Meyers v Casey (1913) 17 CLR 90 CASES CITED : Jabetin Pty Ltd v Liquor Administration Board; Jabetin Pty Ltd v Benwine Pty Ltd (2005) 63 NSWLR 602 Meagher, Gummow and Lehane, Equity Doctrines and Remedies, 4th ed, Butterworths LexisNexis, Australia, 2002 Willyama Broken Hill Motor Inn Pty Ltd - Plaintiff PARTIES : Irontop Pty Ltd - 1st Defendant Damien Clifton - 2nd Defendant FILE NUMBER(S) : SC 3526/06 COUNSEL : Mr N Murray - Plaintiff Mr G M McGrath - Defendant SOLICITORS : Judd Commercial Lawyers - Plaintiff Richard Fredrick Fischer Solicitor - Defendants IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION GZELL J THURSDAY 6 JULY 2006 3526/06 WILLYAMA BROKEN HILL MOTOR INN PTY LTD v IRONTOP PTY LTD & ANOR EX TEMPORE JUDGMENT 1 Willyama Broken Hill Motor Inn Pty Ltd, the plaintiff, is the lessor of a hotel. The lessee is Irontop Pty Ltd, the first defendant. The liquor licence with respect to the hotel is held by the second defendant, Damien Clifton, the stepson of the controller of Irontop. 2 On 30 June 2006, Campbell J granted an ex parte injunction restraining Irontop and Mr Clifton from dealing with the liquor licence until 6 pm today. 3 Mr Murray, who appears for Willyama, submits that there is a serious issue to be tried as to whether, if the liquor licence is transferred by Mr Clifton, Irontop is in a position to re-transfer the licence to his client at the conclusion of the lease. If it cannot, it was submitted that Irontop would be in breach of an express covenant in the lease, or of an implied covenant not to transfer the liquor licence so as not be in a position to re-transfer at the conclusion of the lease. 4 There is no present threat of a transfer of the licence by Mr Clifton. Mr Murray seeks an interlocutory quia timet injunction. While it has sometimes been suggested that a greater degree of proof is required in a quia timet injunction than in other kinds of injunction, the learned authors of Meagher, Gummow and Lehane, Equity Doctrines and Remedies, 4th ed, Butterworths LexisNexis, Australia, 2002 at [21-395] point out that that is not so. The same degree of proof is required, but it may well be that in many cases it will be considerably more difficult to prove that an apprehended injury will occur than it is to prove that an existing one will continue. 5 Mr Murray relies upon the statement of principle of Isaacs J, with whom Rich J agreed, in Meyers v Casey (1913) 17 CLR 90. In that case the plaintiff ran his horse in a race that was to be run under certain rules by which he agreed to be bound. Under those rules stipendiary stewards had power conferred upon them to disqualify an owner for certain specified reasons, not including suspicious practices. Their decisions were final subject to a right of appeal to the committee of the Victoria Racing Club. The committee were empowered to hear an appeal either on evidence taken before the stewards or on fresh evidence, or in any way they might think fit. They could question, set aside, increase, or vary, the punishment conferred by the stewards, or refer the case on appeal back for rehearing. It was also provided that the committee's decision should be final. The committee were also given power to disqualify the owner for certain specific reasons, including suspicious practices. 6 The stewards having disqualified the plaintiff and the horse for suspicious practices in connection with the running of the horse in the race, the plaintiff appealed to the committee on the grounds, inter alia, that he was not guilty of the offence. On his appeal he did not challenge the jurisdiction of the stewards to disqualify him as well as the horse for suspicious practices in running it. On the hearing of the appeal, fresh evidence was given in addition to the evidence taken before the stewards and the committee confirmed the decision of the stewards. 7 It was held by a majority of the High Court that the committee had jurisdiction to entertain the appeal notwithstanding that the decision of the stewards was without jurisdiction. Since the plaintiff had appealed to the committee, it was not open to him to challenge the committee on the ground of want of jurisdiction. The decision of the committee was also justified as an exercise of independent power to disqualify for suspicious practices. In consequence, the plaintiff was not entitled to challenge the validity of his disqualification in a court of law. At 122-123, Isaacs J said this: "The real defence to this part of the case was that he had not proved any threat or intention to expel him, and therefore no ground existed for an injunction. But that objection cannot be maintained. That he had good grounds for fearing such action, once his disqualification was finally settled, is patent. And so he was not unwise in alleging it in the statement of claim (par. 19). The defendants by par. 18 of the defence set up, in effect, the 13th by-law and the resolution of 10th January 1913, and insist on their right to demand his resignation, which is only the stipulated prelude to expulsion. It is trite law that such an insistence of right to do the thing objected to is ground for an injunction." 8 The circumstances of that case included a patent threat of disqualification and a demand for resignation as a prelude to expulsion following the resolution of the challenge by the jockey. In the instant circumstances, there is no such threat. 9 In a letter of 22 June 2006 from the solicitors for Irontop and its controller, reference was made to a decision to undertake a licence transfer. That statement was made in the context of reference to poker machine entitlements and to the decision of the Court of Appeal in Jabetin Pty Ltd v Liquor Administration Board; Jabetin Pty Ltd v Benwine Pty Ltd (2005) 63 NSWLR 602. 10 The solicitors for Willyama, apprehending that there might be some ambiguity in the reference to the licence in that context, sought to clarify the matter by letter of 29 June 2006 in which enquiry was made as to whether it was the liquor licence that was to be transferred. 11 The response came in a letter of 30 June 2006 in these terms. "The reference to the licence transfer in our letter of 22 June 2006 is a reference to the transfer of the licence to operate approved gaming devices. Our client has no present intention to cause a transfer of the hotelier's licence. However if any transfer of the hotelier's licence should be required or desirable at some future time then our client is entitled to take such steps as it thinks appropriate. A review of the relevant lease provisions does not suggest that our client has in any way restricted its rights in this regard and we do not understand how your client asserts that it has any rights to prevent such a transfer of the hotelier's licence or of the entitlements." 12 In my view, not only are the circumstances of this case clearly distinguishable from those in Meyers but there is no threat of future activity which would justify the court granting an interlocutory quia timet injunction. What was said in the letter was that there was no intention to transfer the licence but if any transfer of the hotelier's licence should be required or desired at some future time then the present licensee was entitled to take such steps as were thought appropriate. That does not, in my view, constitute a threat of future activity that is the basis for the grant of such an injunction. 13 In those circumstances, I do not propose to extend the injunction granted on 30 June 2006. I dismiss the motion. I order the plaintiff to pay the defendants' costs of the motion. I stand the matter over before the Registrar at 9.30 am on Tuesday 25 July 2006. ********** DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.