Friendly Inn Holdings Pty Ltd v St George Bank [2012] NSWSC 127

Supreme Court New South Wales

Medium Neutral Citation: Friendly Inn Holdings Pty Ltd v St George Bank [2012] NSWSC 127 Hearing dates: 23, 24 August 2011; 6, 7 February 2012 Decision date: 24 February 2012 Jurisdiction: Equity Division Before: Gzell J Decision: Question answered in the negative Catchwords: LANDLORD AND TENANT - Distinction Between Lease and Licence - whether oral agreement a lease - whether rent paid - mortgagee allows short term licence - whether conditional upon completion of contract for sale - receivers and managers take possession without notice - preliminary question whether a right of occupancy - no principles involved Category: Principal judgment Parties: Friendly Inn Holdings Pty Ltd (First plaintiff) Arcadia Developments Pty Ltd (Second plaintiff) St George Bank - A Division of Westpac Banking Corporation (First defendant) Atle Crowe-Maxwell and John Frederick Lord Receivers and Managers of Hummingbrooke Pty Ltd (Second defendants) Representation: Counsel B DeBuse (Plaintiffs) R de Robillard (Defendants) Solicitors Watson & Watson Solicitors (Plaintiffs) Herbert Geer, Lawyers (Defendants) File Number(s): 2011/44927

Judgment

The question to be determined 1The plaintiffs, Friendly Inn Holdings Pty Ltd and Arcadia Developments Pty Ltd, seek declaratory relief as to their right of occupation of hotel premises in Kangaroo Valley known as The Friendly Inn Hotel. 2Holdings and Arcadia also seek a declaration that the stock, cash, fixtures and fittings located within the hotel on 9 February 2011 were their property. And they claim damages including punitive damages. 3On 18 March 2011, Pembroke J ordered that there be separately determined the claim for relief in the first prayer of the amended summons dated 22 February 2011. That paragraph was in the following terms: "1. A declaration that pursuant to an agreement between the Plaintiffs and Hummingbrooke Pty Limited the Plaintiffs: 1.1 Are the owners of the business operating as the Friendly Inn. 1.2 Have the right to occupy the premises at 159 Moss Vale Road, Kangaroo Valley and operate the business known as the Friendly Inn." 4Since the resolution of the separate question was ordered, the terms of paragraph 1 have changed. In the current pleading, a further amended summons filed on 29 March 2011 paragraph 1 is as follows: "1. A declaration that between 9 February 2011 and 23 March 2011 pursuant to an agreement between the Plaintiffs and Hummingbrooke Pty Limited and either consented to by the defendants or by which the defendants by reason of their conduct are bound the Plaintiffs: 1.1 ... 1.2 Had the right to occupy the premises at 159 Moss Vale Road, Kangaroo Valley and operate the business known as the Friendly Inn and not to have such occupation terminated except with reasonable notice from the Defendants." 5I will treat the question to be answered as that in the further amended summons. 6The significance of the dates is that on 9 February 2011 the second defendants, Atle Crowe-Maxwell and John Fredrick Lord, as receivers and managers of Hummingbrooke appointed by the first defendant, St George Bank, took possession of the hotel. Interlocutory relief granted against the bank and the receivers and managers put Holdings and Arcadia back into possession, which was given up voluntarily on 29 March 2011.