Adamson v Ede [2008] NSWSC 1143

New South Wales Supreme Court

CITATION : Adamson v Ede [2008] NSWSC 1143

HEARING DATE(S) : 20, 21 and 22 October 2008

JUDGMENT DATE : 31 October 2008

JUDGMENT OF : Harrison J

DECISION : Parties to bring in short minutes to reflect the orders proposed at par [75].

CATCHWORDS : LEASES – claim by tenant for injunction to restrain landlord from proceeding to recover possession of rural residential premises – relationship of solicitor and client between tenant and landlord - cross claim by landlord to set aside lease as unjust under the Contracts Review Act 1980 or as procured through breach of fiduciary duty or undue influence – special conditions prepared by tenant purporting to give ownership of part of property to him and otherwise rendering the obligation to pay rent illusory – special conditions unjust within s 7(1) of the Act – balance of lease enforceable according to its terms.

LEGISLATION CITED : Contracts Review Act 1980

CATEGORY : Principal judgment

PARTIES : Christopher Michael Adamson (Plaintiff) Kenneth John Ede (Defendant)

FILE NUMBER(S) : SC 11862 of 2008

COUNSEL : G A Sirtes SC (Defendant)

SOLICITORS : In person (Plaintiff) Horowitz & Bilinksy (Defendant)

IN THE SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION

HARRISON J

31 October 2008

11862 of 2008 Christopher Michael Adamson v Kenneth John Ede

JUDGMENT 1 HIS HONOUR: These proceedings arise out of the breakdown of a relationship between the plaintiff and the defendant. There have been other proceedings between them: see Adamson v Ede [2007] NSWSC 829 and ACN 097 590 817 Pty Ltd as Trustee of the ACN Trust v Ede; Adamson v Ede [2007] NSWSC 1384. The facts and circumstances in those cases partly inform the present dispute between the plaintiff and the defendant and the development and continuance of enmity between them. 2 The plaintiff is a solicitor. On 31 July 2001 the defendant signed a Residential Tenancy Agreement prepared by the plaintiff, which on its face granted a lease of the defendant's property at Nabiac to the plaintiff for a term of three years commencing on 30 June 2003 with two options to renew for further terms of three years each. The lease contained a series of Special Conditions to which it will be necessary to refer in more detail shortly. The defendant denies that he signed the lease in its present form, insisting that it was blank when he did so, but that he signed it in anticipation of his former wife and co-owner of the property being granted a tenancy for a short term pending resolution of then current matrimonial proceedings between them. The plaintiff acted as the defendant's solicitor in those proceedings. However the defendant's wife left the property in about August 2001 when she was paid $80,000 in accordance with the terms of a property settlement. The plaintiff caused that sum to be lent to the defendant from his family trust. The plaintiff subsequently went into possession of the property in or about April 2003 and has remained there ever since. The first option to renew the lease was purportedly exercised prior to the expiration of the first term on 30 July 2006. 3 If the lease is valid and enforceable by the plaintiff it follows that he is entitled to remain in possession and occupation of the property, subject to any right that the defendant may have or acquire to terminate the tenancy for breach and recover possession. The plaintiff has never paid rent to the defendant as the result of his insistence that, in the events that have occurred, the Special Conditions of the lease have operated to relieve him of the obligation to do so. At all events, the present proceedings are more closely concerned with the defendant's contentions that arise on his cross claim than with an assessment of the precise position of the plaintiff under the lease. This is explained in more detail below. The proceedings 4 By his summons filed on 23 April 2008 the plaintiff seeks the following relief: "1. A permanent injunction restraining the defendant from taking or attempting to retake possession of the premises at Lot 106 Trapyard Road Nabiac . . . being the property described in the Residential Tenancy Agreement dated 31 July 2001 between the plaintiff and another and the defendant except in accordance with a judgment, warrant or order of a court." 5 At the hearing on 20 October 2008 the defendant was granted leave to file an amended cross summons. The amendments were all related to the application to join ACN 097 590 817 Pty Ltd ("the company"), which is the trustee of the plaintiff's family trust. The plaintiff is the sole director and shareholder of the company. It is named as a tenant of the property on the lease along with the plaintiff. Its joinder was expressed to be for no purpose other than to avoid the possibility that the cross claim might fail for want of a party. 6 The orders sought by the defendant in his cross summons are therefore presently as follows: "1. A declaration that the Residential Tenancy Agreement dated 31 July 2001 ("the Lease") not be enforced pursuant to s 7(1) of the Contracts Review Act 1980 (NSW);