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Judgment 1BEAZLEY JA: I agree with Young JA. 2MACFARLAN JA: I agree with Young JA. 3YOUNG JA: This is an appeal from a decision of Ball J who made an order for specific performance of an agreement for lease made on 15 July 2003. 4I should first set out the basic background facts, most of which are uncontested. The appellant is the registered proprietor of land at Strathfield which apparently was once used by the Methodist Church as a bible college when it was called Leigh College. The land consists of two lots, Lot 100/774567 which includes two principal buildings known as Leigh Hall and Vickery Chapel and Lot 4/773523 on which is erected another building known as Brundah Hall. 5Brundah Hall is a double storey 9 room colonial style building with an attached single storey building known as the Annex and one detached single storey building known as the Summer House. 6From the time that the appellant purchased the property, she, together with her husband and two children, resided in Brundah Hall, principally on the second level. In addition, she used rooms 15, 16 and 17 of Leigh Hall as a medical centre. Those rooms had a separate entrance and could be shut off from the rest of the building. 7Since about 1999, Vickery Chapel has been used by Shree Shirdi Sai Sanstan Sydney Ltd as a place for prayer and community activities for the Sydney Hindu community. Without disrespect I will refer to this group as "the Hindu community". 8The Hindu community has never taken an active role in these proceedings and the Court has been told that amicable arrangements have been made between it and the other parties for the continued use of Vickery Chapel. 9Prior to January 2003, Noor Al Houda Islamic College Pty Ltd ("the Noor Al Houda proprietary company") (the second respondent), operated an Islamic school at Condell Park. The school needed new premises. The school's principal was Mrs Silma Ihram. Her husband approached the appellant about obtaining accommodation at the Strathfield premises. 10In due course and on 18 March 2003, an agreement for lease was entered into between the relevant parties for a lease for 25 years commencing on 15 July 2003 with one five year option at a rent of $20,000 per month. I will need to deal with this document in more detail later. 11The school moved into the property and has spent some $300,000 on renovations. In these reasons I will use the word "school" to cover the operator of the school for the time being. It would appear that its operators have continually paid rent from the commencement of the lease to the present time. 12Disputes arose between the parties and the appellant proffered the view that the grant of the lease was illegal and void because there was an illegal subdivision brought about by the grant of the lease and that, in any event, the so-called lease was void for uncertainty or the lessee had abandoned it. There were other grounds of objection to which I will come shortly. 13On 22 October 2010, the first respondent commenced proceedings by statement of claim in the Equity Division of this Court for specific performance of the agreement for lease. The matter was heard by Ball J on 20 to 23 June 2011, and his Honour gave a decision on 6 July 20011 [2011] NSWSC 647, granting the plaintiff conditional relief. 14The appellant appeals against that decision. She names as respondents to the appeal the corporation which is currently carrying on the school (the Australian International Academy of Education Pty Ltd ("AIAE")), the Noor Al Houda proprietary company and Mrs Silma Ihram. Mrs Silma Ihram appeared both as a director of the second respondent and on her own behalf, but she protested that she should not be here on her own behalf because she was never a party to the proceedings. The Court agreed with this and ordered that the appeal against her be dismissed with costs. It then proceeded against the other two respondents. 15The appeal was heard on 22 November 2011, Mr D K Raphael and Mr T Flaherty of counsel appearing for the appellant, Mr D Murr SC and Mr J Doyle of counsel appearing for the first respondent. Mrs Ihram, a director of the second respondent, appeared for it: she filed a submitting appearance but remained at the bar table during the hearing though she made no submissions. 16Eight issues appear to be raised for determination, though some were not pressed as strongly as others. These are:

1. Is the grant of the lease illegal and void because of ss 4B and 76A of the Environmental Protection and Assessment Act 1985 (the "EP&A Act") or s 23D or s 23F of the Conveyancing Act 1919?
2. Is the agreement for lease void for uncertainty?
3. Has the lessee abandoned the lease, vide clause 17.1.5 of the agreement?
4. Was the lessee in breach by: (a) ceasing to carry on business; (b) assigning the lease; or (c) otherwise and has the lessor put an end to the lease?
5. Was the assignment of the lease to AIAE a sham?
6. Should the lease be rectified?
7. What is the significance of the lessor continuing to accept rent?
8. (Raised on the cross-appeal) Is there an operative estoppel against the appellant? 17I will deal with the matters raised under those eight headings and then:
9. The result of the appeal.
10. Before dealing with the actual questions that arise I need to describe the background facts and refer to various portions of the document. The document appears with slightly differing text in various places in the Blue Appeal Book. I am using the version on pp 443-471 which appears to be the document that was duly stamped. 19It would appear that the document was in the form of a Real Property Act memo for lease with an annexure containing all the relevant terms and conditions. However, the actual form of memo for lease containing the first two pages has been lost, the parties being of the view that it was lost somewhere with the Commonwealth Bank. However, this is of no moment. The document that calls for vital consideration is the annexure which is headed "Commercial Lease". 20It contains a reference schedule. Item 1 is " THE LAND" - "Part of the land comprised in Folio Identifier 100/774567 together with part of the land comprised in Folio Identifier 4/773523." 21Item 5 headed " DESCRIPTION OF PREMISES " sets out the street address and then contains these words "Including All existing buildings, (excluding the chapel) and the land." 22Clause 2 is headed "Definitions and Interpretations". A lot of these are rather circular. However, there is a definition of "common area" and it is said that the term "means all those parts of the land contained in Folio Identifier 100/774567 ("the land") not demised or licensed to any person, designated by the Lessor from time to time for use by the tenants and other occupiers of the land and their respective employees invitees and licensees in common with each other." It is to be noted that there is no reference to Folio Identifier 4/773523. Nor is there any plan. 23At this point it might be useful to describe the land. Lot 100 is far more extensive than Lot 4. Lot 100 has a frontage to Liverpool Road but its internal drive entry is from Hill Street. To the left hand side of the drive as one comes in off Hill Street is a car park, then as one proceeds along the road to the left is Leigh College and further on the Chapel. To the right appears to be an open area. Then as one proceeds up the drive one crosses into Lot 4 where there is Brundah Hall to the left and again the open area to the right and the drive seems to exit onto Liverpool Road. A plan prepared later appears to show that the appellant considers that the drive and the land to the right of the drive were the common usage land. The Chapel was not actually leased as at March 2003, but the Hindu community did at least have a licence over it. 24Item 9 of the reference schedule headed " PERMITTED USE " said: "As a School and Educational Premises including child care facilities, kindergarten to Year 12 and Senior College activities." 25Clause 16 dealt with assignments, sub-leases and mortgages. 16.1 generally requires the lessee to have the lessor's consent to any proposed sub-lease, but 16.1.A is as follows: The Lessee shall be entitled to Sublease the Leased premises without consent if the proposed Sublease relates to the permitted use. 26Clause 16.2 makes similar provisions with respect to assignments. 16.2.A reads: The Lessee shall be entitled to Assign this Lease to relate [sic] parties without consent. 27Clause 16.3 deals with the procedure for obtaining consent and 16.3.4 provides that, provided the lessee has complied with the procedure, if the lessor has not within 30 days after the request was made given notice in writing either consenting or withholding consent, the lessor is taken to have consented to the assignment. 28Clause 16.7.1 is in a rather convoluted form, but seems to equate "related person" to the definitions as they appeared in the Corporations Law (being the statute governing corporations in force at the time). These are substantially the same as those in the present Corporations Act 2001 (Cth). 29Clause 17.1.5 made it an act of default if "the Lessee ceases or threatens to cease to carry on its business or does not carry on its business in accordance with the Permitted Use". 17.2 permits that the lessor, "after first giving prior notice where required by law", at its option may by notice in writing determine the lease. The landlord purported to do that in February 2006, but continued to accept rent. 30Clause 17.4 provides that the lessor's failure to take advantage of breaches shall not be construed as waiver. In particular, cl 17.4.3 provides: The subsequent acceptance of rent under this Lease by the Lessor shall not be deemed to be a waiver of any preceding breach by the Lessee of any term, covenant or condition of this Lease other than the failure of the Lessee to make the particular payment or payments of rental so accepted, regardless of the Lessor's knowledge of such preceding breach at the time of acceptance of such rent. 31Clause 24.9 provides: The Lessor shall have full and free use of the Chapel and common land areas however the Lessee shall not be required to maintain and repair the Chapel. 32Clause 24.12 provides: This Lease shall operate and act as a Deed and be deemed an Agreement for Lease pending the commencement of this Lease. 33Clause 24.15 provides: Notwithstanding the provisions of the Lease, the parties agree that the Lessor shall be entitled exclusive access and use of the Doctors Surgery within Leigh Hall College comprising Rooms 15, 16 and 17 and the toilet facilities. 34I should also note that clause 2.7 of the lease was an entire agreement clause, that is, making it clear that the lease covered the whole agreement between the parties and that there were no other terms nor should any be implied. 35Later in 2003, Noor Al Houda proprietary company became insolvent and was placed into administration on 18 July 2003. The company entered into a deed of company arrangement on 8 September 2003. 36In about August 2004, Mrs Ihram and a Mr Adada formed a new company, a public company limited by guarantee, named Noor Al Houda Islamic College (Holdings) Ltd ("Holdings"). The operation of the school was gradually taken over by Holdings, but the rent was still being paid by Noor Al Houda proprietary company. 37By June 2006, Holdings' financial position had become desperate. The trustees of the Islamic Trust Foundation of Victoria agreed to help out, they became the directors of Holdings which later changed its name to AIAE. 38The primary judge held at [43] that Mrs Ihram continued as principal for a while after the replacement of the directors, but she left at the end of 2006, though she continued on as a consultant. The primary judge found that the appellant was aware of these changes having been informed in June or July 2006 of it by someone who introduced herself as the new principal. 39In February 2007, AIAE agreed to take an assignment of Noor Al Houda proprietary company's rights under the lease. The school's solicitors wrote to the appellant seeking her written consent. She did not respond. However, she did telephone the solicitors maintaining that the Noor Al Houda proprietary company was in breach of the lease. 40From at least April 2007, the appellant sent the school various letters alleging default under the lease and threatening termination. 41On 20 June 2007, the appellant sent a further notice to the Noor Al Houda proprietary company purporting to terminate the lease. She relied on nine alleged breaches. 42I now return to consideration of the question as to whether the grant of the lease was illegal or void because of provisions of the EP&A Act or the Conveyancing Act. 43Section 76A(1) of the EP&A Act provides: If an environmental planning instrument provides that specified development may not be carried out except with development consent, a person must not carry the development out on land to which the provision applies unless: (a) such a consent has been obtained and is in force, and (b) the development is carried out in accordance with the consent in the instrument. 44The EP&A Act provides in s 4 that development includes subdivision of land. Section 4B(1) defines subdivision of land as: The division of land into two or more parts that, after the division, would be obviously adapted for separate occupation, use or disposition. The division may (but need not) be effected: (a) by conveyance, transfer or partition; (b) by any agreement, dealing, plan or instrument rendering different parts of the land available for separate occupation, use or disposition. 45Section 4B(3) of the EP&A Act provides: (3) However, subdivision of land does not include: (a) a lease (of any duration) of a building or part of a building ... 46The definition is different to that which prevailed for many years as s 4 of the Local Government Act 1919 where similar words were used for subdivision, but the equivalent of s 4B(1)(b) was "by any agreement dealing or instrument inter vivos (other than a lease for a period not exceeding 5 years)." Under the definition section "lease" included agreement for lease. Accordingly, under the old system, one could differentiate between an interest created by a lease for five years or more and one for less than that period. 47Despite the wide words in the definition, not every agreement which permits separate use of land will amount to a subdivision; see eg Young v Gosford City Council (2001) 120 LGERA 243, 255 [30]. 48Just what temporary use or occupation of land (other than buildings which are specifically dealt with in the legislation) would constitute a subdivision is a question of fact which does not arise. One would have thought that if there was a papal visit and a school allowed a Catholic corporation to use its oval for the erection of temporary buildings for the refreshment and relief of people attending a papal function for a couple of weeks, that that would not be a subdivision even though there would be separate occupation. 49The new definition does not distinguish between a lease for one day and a lease for five years or more. It is thus not vitally necessary to analyse the rights that were created by the agreement for lease. 50Because of s 53 of the Real Property Act 1900 and decisions such as Carberry v Gardiner (1936) 36 SR (NSW) 559, 569, no common law term exceeding three years in Torrens System land can be created without a registered instrument. It is arguable that there was a 25 year lease created in equity, but there are difficulties in this argument because, if there was a subdivision involved and the local council has not consented to it, then the lease agreement may not be specifically enforceable, in which case there would not be an equitable lease. As the primary judge found specific performance subject to the condition that council approval be obtained, if that decision stands, one may very well conclude that there was an equitable lease for 25 years. 51At law, there will be created a tenancy which is governed by s 127 of the Conveyancing Act ( Carberry at 569). This is a tenancy at will determinable on a month's notice, but is subject to such of the terms of the agreement as are not inconsistent with such a tenancy; see eg Kemp v Lumeah Investments Pty Ltd (1983) 3 BPR 9203. 52Under s 4B(1)(b), one focuses not on the lease, but on the agreement. The agreement provides for separate occupation for 25 years and so would prima facie be a subdivision. 53However, as I have noted above, there is no subdivision where there is a lease of any duration of a building or part of a building. Probably lease includes lease in equity. If there had been a lease to the Hindu community of the Chapel and if there had been a separate lease back from the first respondent to the appellant of the part of Brundah Hall that she occupied at the relevant time, and subject to that the whole of the two lots were leased to the first respondent, there would be no question of a subdivision. Does it matter that the transaction was not carried out in this way? 54Before answering that question, two other matters must be dealt with. 55The first of these is clause 24.12 of the lease document which says: This Lease shall operate and act as a Deed and be deemed an Agreement for Lease pending the commencement of this Lease. 56In view of Carberry's case, this cannot operate to make the lease a lease at law. However, it may well be that the clause operates to reverse the effect of cases such as Davis v McConachie (1915) 15 SR (NSW) 510, but until the lease becomes a lease at law by registration, the covenants are not enforceable as covenants. Apart from this it is hard to see how the clause can have any effect. 57The second matter is of construing what the lease actually demises. 58I have already set out part of the reference schedule and it can be seen that the definition of "the land" indicates that the lease is over part of the land in two certificates of title, though does not designate which part. However, the description of premises in item 5 gives the street address of the property and says "including all existing buildings (excluding the Chapel) and the land". This still contains ambiguity. 59In the definitions in clause 2.1 there is a definition of "Common Area" which is said to mean "all those parts of the land contained in Folio Identifier 100.... ('the land') not demised or licensed to any person, designated by the Lessor from time to time for use by the tenants and other occupiers of the land and their respective employees invitees and licensees in common with each other." In the same clause there is a definition of "premises" which is said to mean "that part of the Land hereby demised in item 5 and includes the Lessor's fixtures and fittings". 60There is no plan attached to the lease. However, there is a plan in evidence which I have described earlier and this shows that there is vacant land adjoining the internal road on the Liverpool Road side of the plot. The lease as I have indicated, does mention common land. There are three possibilities: (a) that the references to common land in the lease are mere excrescences where the drafter has not crossed out provisions of a common form; (b) that the common area can be identified by extrinsic evidence; or (c) the lease is void for uncertainty. 61The further amended statement of claim contains as annexure A a plan of the land which shows a landscaped area adjoining Liverpool Road and then further away from Liverpool Road a lawn area, but the further amended statement of claim seeks a declaration that there is a valid and enforceable lease in respect of the whole of the land excluding the Vickery Chapel. 62The primary judge said at [61]: It is clear that the lease describes the leased land as "part" of the two lots because of the exclusion of the Chapel and Rooms 15, 16 and 17 and the toilet facilities of Leigh Hall. Those exclusions are capable of precise identification. Consequently, the lease is not void for uncertainty. The fact that no plan was attached does not alter the position. 63The primary judge's judgment does not seem to be troubled with the question as to what was the common area excluded from the lease of part of Lot 100. Mr Raphael's submissions put that there are a number of possibilities, viz: (1) the common driveway over Lot 100 (but for some reason or other not Lot 4); (2) common use of the car park; (3) common use of the grassed gardens in front of Lot 100 (but not Lot 4); and three other possibilities. 64Mr Murr says that the form of the lease obviously shows that it is a shopping centre lease precedent which has been adapted. There are various parts of the lease which are just inapplicable. With a shopping centre lease one finds references to common area, but it is quite inappropriate to the present case, and that when one looks at the lease as a whole, one just gives no significance to the references to the common area or common land area. 65I have a reluctance to take that course because, as a general rule, it is necessary to give every word in the document some significance if possible because one does not lightly assume that parties have gone through the solemn farce of putting in meaningless references to documents. However, in the instant case, Mr Murr's explanation has a fair amount of good sense behind it and the other possible constructions have less to recommend them than this one. 66The second possibility is that one can use the surrounding circumstances to make more certain what is indefinite in the lease; see eg Foa , General Law of Landlord and Tenant (1947) [96] p 57. Mr Raphael says that one cannot do that in the instant case because of clause 2.7 of the lease, the entire agreement clause. 67I do not consider that that clause operates so that one cannot look to surrounding circumstances and to the state of the land when the lease was granted to construe what was demised. 68A more serious objection is that there is not just any sufficient evidence as to what the parties did mean other than that they meant the whole of the land other than the two areas which were to be occupied by the appellant as her doctor's surgery and by the Hindu community. 69Mr Raphael says that to construe the lease that way really means reading out the word "part" or substituting the word "whole". I do not, with respect, agree with that. It is still part, even if part means virtually the whole. The principal reason for not adopting this construction is the reference to the common areas which I have already considered. 70The third possibility is that the lease is void for uncertainty. This is something that the Court would strive to avoid, particularly in a case where the tenant has been in active possession for a number of years and has paid rent. However, as Mr Raphael points out, there are limits on a court construing a document to avoid reaching the conclusion that it is void for uncertainty. Mr Raphael submits that that point has been reached. With respect, I disagree. It seems to me that one can dispose of the problems with the common areas in the way in which I have noted above and that the factual matrix, married with some provisions in the lease document, shows that the part referred to is the whole of the land other than the Chapel and the doctor's three rooms in Leigh Hall. 71Returning then to the question as to whether there is a subdivision, if the lease were a lease of the whole excepting Vickery Chapel and the doctor's rooms in Leigh Hall, there would be no doubt at all that there was no subdivision involved because of the proviso to the definition of subdivision that a lease of any duration of a building or part of a building is not a subdivision. 72In the Northern Territory, there is a similar provision save that the proviso applies only to part of a building, not to the lease of the whole building. The Northern Territory legislation was considered by Blokland J in Finlay Stonemasonry Pty Ltd v JD & Sons Nominees Pty Ltd [2011] NTSC 37; 249 FLR 462. In that case there was a lease for part of a building for the purpose of operating a coffee shop, but the lease described what was demised to "all the land, building and improvements indicated in the diagram". The argument was that because of the maxim cuius est solum eius usque ad coleum et ad infernos, not only was part of the building leased but also the land underneath it and the airspace above it and thus there was an illegal subdivision. Her Honour rejected that argument, ruled that the cuius est solum maxim must be applied sensibly, construed the exception pragmatically and held there was no subdivision. 73In Hardy v Wardy [2001] NSWSC 180; 10 BPR 18,577, the plaintiff was a lessee of a warehouse at Alexandria for seven years with an option to purchase. The lease described what was demised as "two storey building being warehouse and offices known as ... Alexandria". Bryson J held that on the factual matrix of that case, the parties had intended to create a lease over the whole of the land on which the building stood as well as the building itself and hence there was a subdivision. However, he still made an order for specific performance, holding that a mere agreement was not sufficient to involve an illegality but that the decree would need to be moulded so that the law was complied with. 74The decision is the subject of a note by Professor Peter Butt in (2002) 76 ALJ 346-7. Professor Butt notes that Bryson J's decision was contrary to the practice in NSW which had commenced with the decision of Jacobs J in Re Lehrer (1961) 61 SR (NSW) 365 and that the redrafted proviso which now appears in the EP&A Act was designed to restore the pre Hardy v Wardy view of the law. With respect, I think that is right. 75Accordingly, unless the circumstances otherwise show, the lease of a building does not imply the lease of the land below or above the building. It does not effect an illegal subdivision because of the proviso in s 4B(3)(a) of the EP&A Act. 76The present case, of course, involves not the lease of a building but just the mirror reverse: the lease of the whole of the land except two buildings or two buildings and part of another building. In my view, that lease should be treated in the same way, that is, that as the lease of the building or part of a building would not be an illegal subdivision, so also is the lease of what is left after those two buildings or portions of a building are excised. Thus in my view there is no subdivision involved in the instant case. 77However, if I am wrong in this, then I am quite sure that the way in which the learned primary judge dealt with the matter is correct. As in Hardy v Wardy , a decree was made requiring the appropriate subdivisional approval to be obtained before there was a change in registered title. 78The learned primary judge dealt with this problem in paras [66] and following of his reasons. He noted that the EP&A Act does not expressly address the enforceability of agreements that involve a breach of the Act. He noted that the trend of authority such as Australian National Carparks Pty Ltd v State Rail Authority of NSW [2005] NSWSC 120, was to the effect that dealings involving a breach of s 76A(1) of the EP&A Act are not automatically void. 79This view depends to a large extent on the way the High Court has approached questions of agreements that breach an Act in Yango Pastoral Co Pty Ltd v First Chicago Australia Ltd [1978] HCA 42; 139 CLR 410 at 423; Master Education Services Pty Limited v Ketchell [2008] HCA 38; 236 CLR 101. 80The primary judge said at [72]: Once it is accepted that the lease is not void because it involves a breach of s 76A(1) of the EPA Act, in my opinion a term is to be implied that Dr Taluja will do all things reasonable on her part to be done to have the lease registered, including obtaining the council's consent to the subdivision effected by the lease. That implied obligation arises from the fact that Dr Taluja agreed to grant a lease of the premises the subject of the lease to Noor Al Houda for 25 years. That lease can only take effect if the lease is registered. In order to register the lease, the land to which the transaction relates must be shown on the current plan. Relevantly, the current plan must be a registered plan which is a plan of subdivision. However, a plan of subdivision cannot be registered unless the subdivision has been approved. The agreement to grant the lease carries with it an agreement to do all things reasonable to give effect to that agreement*... . [*The learned judge referred to Butts v O'Dwyer [1952] HCA 74; 87 CLR 267] 81I respectfully agree. 82Accordingly, I consider that the ground that the grant of the lease was illegal and void because of ss 4B and 76A of the EP&A Act fails. 83Section 23F of the Conveyancing Act 1919 allows the Registrar General to refuse to register transactions of part of an existing lot unless there is a current plan. For this reason, the lease is not in registrable form. 84Although Mr Raphael put some reliance on this section, it really has little significance. The appellant covenanted to do all that was necessary to secure registration and the supply of a plan falls within this covenant. 85Section 23D of the Conveyancing Act which requires writing does not cause a problem as there is sufficient writing or, even if that is wrong, there has been part performance.