76 The appellants further submitted that the Board's finding that the second respondent was holding over under cl 10 of the Lease was in error. In my view there can be no doubt that the Board was correct in finding that from the expiration of the Lease until December 2006 the second respondent was indeed holding over at a weekly rental of $1,800 plus GST. Whether the second respondent was holding over under cl 10 or under the common law matters not. The fact, correctly found by the Board, was that he was holding over during the course of the negotiations between the parties for a replacement lease.
77 However, it does not follow from the fact that the second respondent was so holding over that, in the circumstances revealed in the correspondence to which I have referred, the parties had abandoned, as the respondents submitted, the agreement for lease constituted by the exercise of the option so as to justify the rejection by the Board of a finding "that the terms of the option to renew the lease which would provide new provisions" were in force.
78 The difficulty with the Board's decision is that having come to the correct conclusion that no agreement had been reached with respect to the terms of a new lease and that negotiations therefor had terminated, it concluded that it therefore followed ("accordingly") that the second respondent continued to occupy the premises under the holding over provisions of the Lease in circumstances where the agreement for lease constituted by the exercise of the option had ceased to be "in force".
79 It is true, as the respondents submitted, that the Board's apparent reason for finding that the effect of the option was no longer "in force" was because negotiations with respect to the terms of a new lease had terminated so that the second respondent continued to hold over on a fixed rent. However, there was no finding by the Board that the reason that the exercise of the option and what flowed from it was not "in force" was because the appellants had lost the right to obtain an order for specific performance of the agreement for lease constituted by the exercise of the option due to the intervening conduct of the parties. Nevertheless it was submitted, particularly by the fourth and fifth respondents, that it was open to the primary judge to support the Board's finding on a basis other than that which it had adopted.
80 The fourth and fifth respondents submitted and the primary judge found, that specific performance would inevitably be denied by a court of equity whereas the first and second respondents submitted that it was at least likely that that would be the case although not inevitable.
81 The first and second respondents accepted that it was open to his Honour to have reference to the evidence that was before the Board in order to construe or properly understand the Board's reasons. They reiterated their submission at trial that both parties had acted inconsistently with the alleged agreement for lease arising from the exercise of the option by the second respondent tendering, and the appellants accepting a fixed rent of $1,800 per week for almost two years which was explained by the appellants informing the second respondent that they considered a turnover rent to be too onerous.
82 General assertions were made that defences of estoppel by convention, misleading and deceptive conduct and perhaps laches and delay, could be thrown into the mix to counter the appellants' assertion of a current equitable interest constituted by the agreement for lease as at the date of the Board's decision. However, the difficulty with this submission and his Honour's finding adopting it, was that little attempt was made by the respondents to assert facts arising from the correspondence between the parties which it would be open for a court of equity to find in support of the potential defences asserted.
83 The only submission made apart from bare assertions, to identify any alleged misleading or deceptive conduct on the appellants' part was the insistence by the appellants, when negotiations terminated, on the second respondent paying the turnover rent provided under the option, having accepted a fixed rent in the meantime. Why in the circumstances that was misleading or deceptive was not explained. It is certainly not self-evident. Further, no reasoned submission was advanced in support of any relevant change of position or prejudice sustained by the second respondent as a consequence of any particular conduct of the appellants which might support some form of estoppel. Although it may have been suggested that a conventional estoppel could have arisen out of the correspondence which I have detailed above, no reasoned submission was put to support any such suggestion.
84 As I have noted at [80] above, only the fourth and fifth respondents submitted that it was inevitable that a court of equity would refuse specific performance of the agreement for lease arising as a consequence of the exercise of the option. The Board did not consider the issue and adopted different reasons for its conclusion that the option provisions were not "in force". However, the primary judge (at [86]) did hold that the parties' conduct would constitute "an impenetrable barrier to any claim for specific performance" by the appellants.
85 Only such a finding could sustain that of the Board that the option provisions were not "in force" at the time of the decision. Being an application for judicial review, it was not open to his Honour to decide a specific performance suit unless he correctly found that the only conclusion the Board could have reached was that specific performance would be refused. The first and second respondents' submissions on the issue did not go so far although those of the fourth and fifth respondents did. In my view it is simply impossible to speculate, and it could only be speculation, as to whether a court of equity would refuse, let alone inevitably refuse, specific performance given the common stance of the parties as to their rights arising out of the exercise of the option which each maintained throughout the negotiations for a replacement lease.
86 In my opinion the Board's decision cannot be sustained on the basis that specific performance of the agreement for lease constituted by the exercise of the option would necessarily be refused.
87 The first and second respondents also submitted that there had been no agreement reached on the essential terms of the lease to be granted pursuant to the exercise of the option except with regard to rent. Accordingly, there could be no agreement for lease and, in particular, no specifically enforceable agreement for lease.
88 With respect, I have difficulty in understanding this submission. It is true that cl 21.1 of the Lease only stated that upon the exercise of the option the lessor would at the expense of the lessee demise to the lessee the premises for a further term of six years at the turnover rental stated. It did not, as is normally the case, state that the lease so granted would be subject to the covenants, agreements and provisos as contained in the existing lease except for the option to renew provision. However, in my opinion that was clearly implied. In fact it is consistent with the assertions of the parties in the correspondence to which reference has been made. Thus the only complaint made by the second respondent with respect to the terms of the new draft lease that was proffered by the appellants was that its terms were different to and more onerous than those of the Lease.
89 The fourth and fifth respondents nevertheless submitted that even though the reasoning of the Board in coming to its conclusion that the "new provisions" arising out of the exercise of the option were not "in force" might be flawed, nevertheless there was available a substratum of fact and law which would have led to the same finding even if it was not on made the basis that the Board expressed.
90 It was thus submitted that in these circumstances it was open to his Honour to find, as he did at [86], that the conduct of the parties over an extended period of time would constitute an impenetrable barrier to any claim for specific performance of any agreement for lease constituted by the exercise of the option.
91 The difficulty with this submission is that the factual material that was before the Board does not support it. That material established the following:
(a) The appellants and the second respondent at all times acknowledged that the option contained in cl 21.1 of the Lease had been validly exercised and as a consequence thereof the second respondent was entitled to receive and the appellants were bound to grant, a lease on the same terms as the Lease except for cl 21 for a term of six years at a rental determined in accordance with cl 21.1(a) and (b);