Pappas v Bowmark Pty Ltd [1998] VSCA 120

8. According to the respondent, the appellant had by August 1997 paid only one month's rent: $2,416.67. On 20 August 1997 the respondent served notice of default, threatening to re-enter or to forfeit the lease if arrears, said to be some $52,000, and interest were not paid within 14 days.

11. On 21 August the parties met, together with the appellant's local Member of Parliament, with a view to reaching a compromise of the dispute whether the arrears claimed were payable or should have been paid. The result of that discussion was apparently inconclusive.

14. On 5 December 1997 there was a further meeting between the appellant and a representative of the respondent. It seems to be common ground that on that day an agreement was made to resolve the dispute. There is, however, as appears from some correspondence between the solicitors for the parties, dispute as to the content of the agreement. According to a letter dated 8 December from the appellant's solicitors to those for the respondent, the agreement was that the appellant should immediately pay the sum of $15,000 of the outstanding arrears of rental, and that the balance be paid within 60 days, that is by 5 February 1998; that the appellant remain in the premises as tenant and pay the rental as previously fixed until the end of the term; and that a full accounting of rental received by the respondent be provided, there being some dispute as to whether the appellant had made more than one monthly rental payment. With their letter of 8 December the solicitors for the appellant sent the $15,000 payment which had been agreed upon.

17. By letter of 9 December 1997 the solicitors for the respondent wrote to those for the appellant saying that their letter of 8 December had not accurately stated the agreement. Part of the agreement, according to the respondent, was that the appellant should by 8 December provide evidence that she was financially in a position to satisfy the rental arrears within 60 days of 5 December. There were other provisions asserted by the solicitors for the respondent which I need not mention; but the letter concluded by saying that, if the appellant did not provide evidence by 11 December that she was able to pay the balance of rental arrears by 5 February 1998, the respondent would proceed to evict her as foreshadowed. By writing that letter it seems that the respondent, through its solicitors, had at least arguably waived provisions of the agreement said to have been reached on 5 December requiring the provision by 8 December of the financial information. By 22 January information had not been provided in accordance with the requirements of the respondent and, on that day, the respondent entered the premises and changed the locks with a view to keeping the appellant out. With a measure of intrepidity the appellant herself soon afterwards obtained entry again and continued to conduct the business on the premises for which she had leased them.

20. There was further dispute between the solicitors for the parties, by way of assertion and counter assertion, about the appellant's right to be in possession but ultimately, in April this year, the respondent again took possession and again the appellant managed herself to re-enter. Thus it was that on 9 April proceedings were begun in this Court seeking possession on behalf of the respondent of the subject premises. The means selected was an application by originating motion pursuant to Order 53 of the Rules of Court. After an adjournment the matter came on for hearing in the Practice Court on 30 April this year. A lengthy affidavit was submitted on behalf of the present respondent, and a more modest affidavit was sworn by the appellant.

23. In addition to opposing the application for summary judgment brought on behalf of the respondent the appellant, by her own originating motion, sought relief against forfeiture. It was her case that she was in possession of the premises as a lessee. She contested the allegation that the respondent had on 22 January duly terminated the lease by re-entry. She further contested an allegation by the respondent that, thereafter, when she had gone back into occupation of the premises, she was there as licensee pursuant to an express licence agreement made between the parties by reference to correspondence between their solicitors.

26. The appellant swore in her affidavit that she had never made a licence agreement with the respondent in respect of the premises and that it was never agreed between them that she was a licensee. She asserted that she was still a tenant within with the rights as tenant under the lease. There was no cross-examination on the affidavits.

29. The learned judge refused the appellant's application for a further adjournment and on 30 April gave judgment for possession in favour of the respondent, dismissing the appellant's application for relief against forfeiture.

32. His Honour's reasons were brief. They record no findings of fact, but the substance of them is that the respondent's case was accepted by his Honour, namely, that the appellant was, on 30 April when his Honour heard the matter, a trespasser on the premises, so that it was appropriate to grant the relief under Order 53.

35. In my opinion it was not, having regard to the material before the learned judge, appropriate that Order 53 should have been resorted to in order to create jurisdiction for resolution of the dispute between the parties. There having been a dispute of fact as to whether there was extant a lease pursuant to which the appellant was in possession of the premises, the summary procedure provided for by Order 53 was inappropriate.

38. Order 53 is intended to enable speedy resolution, in favour of a proprietor of land, of a dispute whereby trespassers are keeping the proprietor out. It is a prerequisite to the application of Order 53 that the persons who are in possession and whom it is desired to have removed should have gone into occupation as licensees or without the plaintiff's consent and remain in occupation without the plaintiff's consent. In this case the appellant initially went into possession as a tenant and the question which was presented to the Court was whether she was entitled to continue in possession as a tenant or whether she was not. In those circumstances it seems to me that Order 53 was unavailable to provide jurisdiction. That is not to say that the mere existence of a factual dispute will deny the application of Order 53. It may be possible to resolve such a dispute quite readily and fairly so that the summary jurisdiction afforded by Order 53 can conscientiously be available. This is not a case of that kind. The matter required resolution at least of the questions whether the agreement that the parties had reached on 5 December 1997 was as the respondent asserted or as the appellant asserted, and whether the appellant was in breach of it when the respondent re-entered on 22 January this year.The judge does not appear to have resolved these disputed questions of fact which were presented to him. What was appropriate when it became evident - as it did not until the very day on which the matters were heard - that there was a dispute of this kind, was to send the matter off for trial with or without pleadings. As it was, it seems to me, pleadings in this case were necessary in order that the several issues that were raised should have been properly exposed and dealt with.

41. In addition to the respondent's claim for possession there was, of course, the claim by the appellant for relief against forfeiture. That there was such a claim which was brought on for hearing concurrently with the respondent's claim for possession should itself, I think, have been enough to indicate that a summary determination was inappropriate. Quite apart from any disputed facts raised upon the respondent's application for possession, there were other disputed facts which needed to be resolved in order to decide whether relief against forfeiture should have been granted.

44. In all the circumstances it seems to me that this appeal, which was a consolidated appeal against the order allowing the respondent's application and that dismissing the appellant's application, should succeed. There should be orders made of a kind designed to facilitate a determination of the disputes as early as possible, and the Court ought to give appropriate directions.

54. I also agree that the appeal should be upheld. I agree with the reasons of the learned judge presiding concerning the operation of Order 53, generally and in relation to this case. For reasons given by his Honour, the appellant has arguable defences which involve the resolution of a number of factual issues as to which there is conflicting evidence. In those circumstances, it was inappropriate to enter summary judgment under Order 53.

57. One matter in relation to which the appellant has an arguable defence is, for example, whether the lease was, in fact, forfeited on 22 January 1998, having regard to the agreement between the parties of 5 December 1998. There is also the question of whether the appellant is entitled to relief against forfeiture.

60. In those circumstances, and given the other issues in this case which raise complicated questions of fact which can only be properly determined at trial, it was inappropriate to give summary judgment under Order 53. The case should be sent to trial.

65. Subject to any submissions counsel may wish to make, the judgment of the Court will be in accordance with the following minutes:

2. That paragraphs one and two of the order made on 30 April 1998 and paragraph three of the order made on 15 May 1998 each in proceeding 5409 of 1998 be set aside.

3. That the sum paid into Court pursuant to paragraph 1 of the last-mentioned order be paid out to the appellant.

4. That the order made on 30 April 1998 in proceeding 5626 of 1998 be set aside.

5. That the costs of the hearings upon which each of the said orders was made be reserved.

6. That proceeding 5409 of 1998 commenced by originating motion continue as if it had been commenced by writ.

7. That the respondent as plaintiff in proceeding 5409 of 1998 file and serve a statement of claim by 30 November 1998, and that further pleadings (including any counterclaim for relief against forfeiture or otherwise if the appellant is so advised) be filed and served in accordance with the Rules.

8. That each party file and serve an affidavit of documents in proceeding 5409 of 1998 no later than ten days after the close of pleadings.

9. That proceeding 5626 of 1998 be dismissed without any order to costs.

77. The respondent may take a certificate pursuant to s.13 of the Appeal Costs Act.