Williams and Nyrogen Pty Ltd v Rampino [2002] VSC 343

5. It is the second such application to have been made to recover the land from the defendant. The first application came on for hearing before Gillard J in the Practice Court on 3 July this year, and on 5 July his Honour dismissed the application and ordered the plaintiffs to pay the defendant's costs. I do not have available to me his Honour's reasons for judgment, but I am told by Mr Clarke, counsel who appears for the plaintiffs, that his Honour was not satisfied that there had been given at least two days' notice of termination of a licence agreement pursuant to which the defendant occupies the property.

8. It is necessary to understand a little of the background facts of the matter. By contract note dated 10 May 2002, the plaintiffs agreed to sell the property to the defendant at a price of $840,000 to be paid by way of a deposit of $45,000 by 9 May 2002 and the balance of $795,000 on or before 24 June 2002. The contract note imported the general conditions of sale (other than general condition 3) contained in the Contract of Sale of Real Estate prescribed under s. 99 of the Estate Agents Act 1980, and thus provided that possession was not to be given until the purchase price had been paid in full.

11. Contemporaneously with the execution of the contract note, or shortly after, the plaintiffs and the defendant entered into a licence agreement which provided for the plaintiffs (therein defined as the licensor) to allow the defendant (therein defined as the licensee) to enter into occupation of and use the premises and the chattels and for the licensee, on or before the date of possession, to pay to the licensor a weekly licence fee of $690. Clause 6 of the licence agreement provided that, notwithstanding anything thereinbefore contained, the licensor may at any time after the date of settlement terminate the agreement by two days' notice in writing to the licensee. The date of settlement was defined in the schedule as being 24 June 2002. It was also referred to in Recital B to the agreement.

14. Clause 7 of the licence agreement provided amongst other things that, in the event that this agreement is determined otherwise than by the licensee effecting settlement of the contract of sale, the licensee shall pay the costs and expenses of restoring the premises and the chattels to the condition that same were in on the date of possession and the licensor may retain from any moneys of the licensee held by the licensor the costs and expenses reasonably required to effect such restoration.

17. After the contract had been entered into, a considerable degree of disputation arose as to whether or not certain moneys had been paid towards the deposit. Allegations and counter allegations were made as to whether the moneys had been directed from the defendant's bank to other bank accounts, but in the end the facts which emerge were that the defendant had paid no more than $10,000 of the deposit, plus a further sum of $5,000 in consideration of an agreement to extend the date for settlement.

20. The day of 24 June 2002 came and went without settlement taking place, and further correspondence was then entered into between the plaintiffs and the defendant's solicitors.

23. On 27 June 2002 the plaintiffs' solicitors sent to the defendant a letter confirming that they acted for the vendors and enclosing a notice of rescission. That notice purported to be drawn pursuant to Condition 6 of Table A in the Seventh Schedule to the Transfer of Land Act 1958, and provided that, unless the default of the defendant were remedied and the proper legal costs specified and interest on the amount due under the contract at the rate specified were paid within 14 days, the contract would be rescinded pursuant to General Condition 6 sub-condition (2) of Table A of the Seventh Schedule to the Transfer of Land Act.

26. On the same day the plaintiffs' solicitors sent a further letter to Messrs Goldstein & Partners, solicitors for the defendant, with which was enclosed a copy of the rescission notice which had been sent to the defendant. Thereafter, in the period up to 18 July 2002 further correspondence was entered into, to the detail of which I need not refer.

29. On 18 July 2002, Messrs Slater & Gordon wrote to the plaintiffs' solicitors as follows (omitting formal parts):

"Your client purports to have validly given my client notice to vacate the property in accordance with Clause 6 of the licence agreement. However, I note that the clause entitles your client as licensee to terminate the agreement by notice at any time after the date of settlement. I am instructed that on 24 June 2002 the parties agreed to extend settlement until 18 July 2002, on the basis that my client pay the sum of $5,000 to your client, together with all penalties payable under the contract of sale in respect of the delay. It was also agreed that the licence agreement would remain in full force and effect until the varied settlement date. I am instructed that your client's conveyancer, Anne Oppy, agreed to this and took receipt of my client's cheque for $5,000 on 25 July 2002. In the circumstances the purported notice is clearly invalid as it has been given prior to the date of settlement, that date being 18 July 2002. My client is accordingly not required to comply with the notice. Further, my client disputes the validity of the purported notice of rescission served by your clients and dated 27 June 2002 in light of the agreement to vary the settlement date. My client has sought specific performance of the contract of sale as varied and has been frustrated in her attempts to arrange settlement on or before 18 July 2002 by your client. My client is ready, willing and able to effect settlement of this transaction and requests that your client nominate a date and time for settlement within the next seven days in order for this transaction to be finalised."

33. By letter dated 19 July 2002, the plaintiffs' solicitors responded to Slater & Gordon as follows (omitting formal parts):

"Without prejudice to any of the rights presently being enforced by our client, we confirm that settlement will take place at 3 p.m. next Thursday, 25 July 2002, at SDA House, Level 6, 53 Queen Street, Melbourne. Our client's bank is the Bank of Melbourne. We do not believe that your client is able to settle. However, we have provisionally arranged a settlement in the event that your client is able to do so. We confirm that this letter should in no way be read as any indication whatsoever that our client's position in relation to this matter in any way accords with your recent correspondence. On the contrary, we are of the view that no valid contract exists and that the contract has been rescinded. Furthermore, your client is now in breach of the licence agreement. For the sake of completeness we also note that any allegations in relation to the oral licence agreement are expressly denied [that is a reference to the arrangement said to have been made with Ms Oppy] and the material previously lodged with the Supreme Court exhaustively sets out the position of our client."

37. Despite that letter, there was no settlement on 18 July, or at all, and the position remains that the only moneys which have been paid by the defendant are the $10,000 which was paid at the time of execution of the contract note to the stakeholder and the further $5,000 which was paid to Ms Oppy for the extension of the settlement date until 18 July of this year.

40. Finally, on 29 July 2002, the plaintiffs' solicitors wrote to the defendant as follows:

"We refer to the letter from solicitors acting on your behalf, Slater & Gordon, dated 18 July 2002, a copy of which has been enclosed with this letter. For avoidance of any further doubt we hereby give you notice that you are required to vacate the property in accordance with the licence agreement dated 11 June 2002. In the event that we do not receive confirmation that you have vacated the property on or before 12 noon Friday 2 August 2002, we shall issue proceedings in the Supreme Court as previously foreshadowed with a view to obtaining an order that you are removed from the property."

44. Mr Clarke has submitted that this is a clear case. He contends that the settlement date means 24 June 2002 as it is defined in the schedule to the licence agreement; that it is clear that that date has now long passed; and that whatever defects, if any, existed in the attempts previously made to terminate the licence agreement (which were the subject of consideration by Gillard J), the licence agreement has now been terminated by the notice served on 29 July 2002, after the date of settlement had passed. He also submits that, even if the view were taken that the date of settlement changed from 24 June 2002 to a later date such as, for example, 18 July 2002 (by reason of the arrangements which were made to extend settlement), that date has also now long passed, and it was only after it had passed that the notice of termination of licence was served on 29 July 2002. He submits that it is not open to conclude that the date of settlement should be taken as extending to such date after 24 June 2002 as might be fixed so long as the contract remains on foot. He contends further that even if such a construction were to be placed upon the licence agreement, or even if it were arguable, it is clear that the contract for the sale of the land has now been brought to an end, by reason of the rescission notice which was served on 27 June 2002, and hence no later settlement date can now be fixed.

47. Ms Rampino appears for herself. She has dismissed Slater & Gordon as her solicitors for the purposes of the litigation, and has retained Goldstein Partners only for the purposes of the conveyancing aspects of the matter. Despite an opportunity to have the matter adjourned for a short period of time in which to retain solicitors and counsel to argue her case, she prefers to proceed unrepresented. She has submitted to me that the present predicament has been brought about by misunderstandings created in the first place by the plaintiffs' conveyancer and, more lately, by a recalcitrance on the part of the plaintiffs to settle without being paid large amounts of interest and costs in addition to the contract purchase price (which additional amounts she is not prepared to pay).

50. The summary procedure for the recovery of land is only appropriate in clear cases. As Tadgell JA said in Pappas v Bowmark Pty Ltd[1], at [13]:

"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 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. In those circumstances it seems to me that Order 53 was not available 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." This 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."

54. This case, however, does seem to me to be a clear case. Having heard Mr Clarke's submissions, the only point that really troubles me is whether "the date of settlement" for the purposes of the licence agreement may include such date after 24 June 2002 as could be set, so long as the contract of sale remains on foot. But despite the arguments which I think can be made in support of that view, I conclude that the expression is limited to 24 June 2002 and such later date as has been set and passed before a notice of termination of the licence agreement is given.

57. There are a number of aspects of the licence agreement which direct me towards that conclusion. But in the end it is Condition 7 which is of greatest significance. It indicates to me an intention that the licence stand separate and apart from the contract of sale, and thus be capable of termination otherwise than by completion or rescission of the contract of sale. On a broader view of the matter, too, it is understandable that the mechanism of the licence agreement was invoked to enable ejectment of the licensee, untrammelled by considerations which might govern the recovery of land from a purchaser who had entered into possession under an uncompleted contract of sale.

60. In the result, the view of the matter which I take is that "the date of settlement" was no later than 18 July 2002 and whether or not the contract remains on foot, which is a question that I need not decide, it was open to the plaintiffs, at the time that it served its notice of termination of the licence agreement on 25 July 2002, to bring the licence agreement to an end. There having been given not less than two days' notice in accordance with Condition 6 of the licence agreement, I conclude that the plaintiffs are entitled to succeed for summary recovery of the land.

MR CLARKE: I have prepared a form of order, if I could hand up three copies of it. It follows the form of Order 53A in Volume 2.

HIS HONOUR: Ms Rampino, the effect of the reasons for judgment I have just pronounced is that I have found in favour of the plaintiffs' entitlement to have served upon you the notice of termination of the licence agreement, which it did on 25 July of this year, and that therefore the plaintiffs are entitled to recover from you the possession of land. Mr Clarke has handed up to me a draft form of order which follows the pro forma in the court rules. Is there anything that you would wish to say against me making orders in that form?

DEFENDANT: I don't understand why the licence agreement and the contract of sale are separate issues.

HIS HONOUR: Thank you. Upon the plaintiffs' application for summary recovery of the land made by originating motion dated 2 August 2002 I will make orders in the terms of the draft minutes of order handed up to me by Mr Clarke and I will initial those and place them on the court file.

[1] [1998] VSCA 120; (1999) V.Conv.R. 54-594.