whether any RELIEF should be granted
34 The finding that I have made is that the Lease was unjust in the circumstances relating to it at the time that it was made because of the failure by Overton to disclose to Mr and Mrs Murphy the fact that the maintenance charges that were then current did not represent a full recovery of the amounts which, under the Lease, Overton was entitled to recover from lessees. There was procedural injustice because Mr and Mrs Murphy entered into the Lease under a misapprehension that the contribution for which they were potentially liable under the Lease represented a greater proportion of their expected income than they had believed.
35 By March 1994, any misapprehension as to that question was dispelled. On the assumption that it was reasonable for Mr and Mrs Murphy to have surrendered their leasehold interest under the Lease within, say, eighteen months, namely by October 1995, they would have avoided any injustice. The appropriate relief under the Contracts Review Act, to avoid the unjust consequence of the entry of Mr and Mrs Murphy into the Lease, would be an order that they not be called upon to pay a greater proportion of their income than they believed they would have to pay until they had had a reasonable opportunity to dispose of the Lease. If they had surrendered their leasehold interest under the Lease by October 1995, they would not have been called upon to pay more than they believed they would be liable to pay.
36 In reaching the conclusion that it was not appropriate to make any order pursuant to s 7(1)(d) of the Contracts Review Act (see paragraph [91] of my Second Reasons) I had in mind the structure of the arrangements relating to the Heritage Village, as summarised in paragraphs [24] to [27] of my First Reasons. In particular, I was mindful that, had Mr and Mrs Murphy disposed of their leasehold at any time after March 1994, the interest that they could have disposed of would have been less than the interest granted to them as consideration for the payment of the Lease Price. That is to say, by March 1994, they had enjoyed exclusive operation of Unit 53 for approximately seventeen months. By October 1995, they had enjoyed the right to exclusive occupation for approximately thirty-six months. They were only able to dispose of unexpired term of the Lease.
37 In my Second Reasons (at paragraph [90]) I observed that there was no evidence that, if Mr and Mrs Murphy had disposed of the Lease within a reasonable time after March 1994, they would have realised an amount that was less than the consideration they had paid for its grant. The Full Court concluded that the accrual of Overton's right to the Lease Rent was evidence to support a conclusion that Mr and Mrs Murphy would have realised less than they paid for the lease. On reflection, the observation that I made at paragraph [90] is elliptical. The interest of Mr and Mrs Murphy that could have been disposed of between March 1994 and November 1996 was something less than the interest that was granted in October 1992 in consideration for the payment of the Lease Price. It was less, by reason of the effluxion of time. It was no longer a ninety-nine year term but a slightly shorter term.
38 It may be correct to say that Mr and Mrs Murphy would have realised, for the reduced Term that remained between March 1994 and November 1996, less than they paid for the full Term in October 1992. However, since the parties appropriated the Total Rent to the first five years of the Term, and there was no evidence to suggest that that appropriation was inappropriate, there was no evidence that Mr and Mrs Murphy would have realised for the interest that they then had to dispose of, an amount that was less than the consideration they had paid for that interest.
39 The transaction between Overton, on the one hand, and Mr and Mrs Murphy, on the other, was entered into at arms length. I am not persuaded there was evidence to support a conclusion that, if Mr and Mrs Murphy had disposed of the leasehold interest under the Lease by October 1995, they would have realised an amount that was less than the consideration they paid for the grant of that interest, simply by reason of the appropriation of Total Rent. That is the only basis upon which the Second Full Court regarded it as appropriate to remit the proceedings.
40 In the course of the further hearing following the second remitter, counsel for Mr and Mrs Murphy advanced arguments that I regarded as new, in the sense that they had not previously been advanced in the proceeding, either in writing or orally. Mr and Mrs Murphy contended that relief should be granted to them under the Contracts Review Act in the form of an order requiring Overton to enter into a deed. The form of the deed, without annexures, is set out in Appendix 1 to these reasons. It will be apparent from what I have said above that I do not consider that such relief is appropriate.
41 The essential contention was that, because it was not possible for Mr and Mrs Murphy to have surrendered the Lease at any time without incurring a loss, the only appropriate order that could be made for the purposes of avoiding any unjust result or consequence of entering into the Lease was an order that Overton pay to Mr and Mrs Murphy the difference between:
· the Lease Price paid by them in October 1992, of $215,750, together with interest for that amount at the rate applicable under s 51A of the Federal Court of Australia Act 1976 (Cth); and
· the value of the leasehold interest of Mr and Mrs Murphy under the Lease as at the date on which Overton ceased to be a manager, or a date as close as possible to that as the evidence permitted.
42 Overton ceased to be the manager of the Heritage Village in June 2000, shortly after delivery of my First Reasons. It was said by counsel for Mr and Mrs Murphy that they had not wished to involve Cuzeno, the purchaser of the reversion, in the litigation and, hence, contended that the cessation of the interest of Overton was an appropriate date. Whether or not it was a reasonable decision not to involve Cuzeno in the litigation is not a relevant question for me. However, there is no logical rationale for choosing that date as a date for determining the appropriateness of such a comparison. There has been no suggestion that Mr and Mrs Murphy proposed to surrender the Lease at any time. There is, of course, no evidence as to the present value of their leasehold interest.
43 In any event, I do not regard such a contention as open to Mr and Mrs Murphy at this stage in the proceedings. The basis upon which the proceedings were remitted required no more than an examination of the effect of the appropriation provisions in relation to Total Rent contained in Clause 4 of the Lease.
44 I do not consider that there is material before me that enables me to conclude that the consequence of surrender by Mr and Mrs Murphy of their leasehold interest under the Lease at any time during the period March 1994 to October 1995 would have resulted in any loss. They would have had the benefit of exclusive occupation of Unit 53 from October 1992 to the time of surrender. They agreed that the rent attributable to that occupation was an amount equal to 1/60th of the Total Rent per month. They had agreed that they would take the risk of a capital loss in relation to the Lease Deposit and would share any capital gain in that regard with Overton.
45 Detailed written submissions were made on behalf of both parties. Included in written submissions on behalf of Mr and Mrs Murphy is a section dealing with matters that were "formally put even though it is acknowledged that these matters have already been determined against the Murphys". I indicated that I did not propose to deal with submissions on that basis. Either submissions were put at the earlier hearings or they were not. If they were, it would be unnecessary to put them again "formally". If they were not, it would not be permissible to put the submissions at this late stage.