IN THE HIGH COURT OF FIJI
(AT SUVA)

CIVIL ACTION NO. HBC 400 of 1997S

Between:

MOHAMMED TAHIR
(f/n Babu Raza)
Plaintiff

and

WING ZOING WAH AND COMPANY LIMITED
Defendant

G. O’Driscoll for the Plaintiff
Ms. B. Narayan for the Defendant

JUDGMENT

In February 1993 the parties entered into a lease agreement whereby the Plaintiff took certain premises at Nausori from the Defendant for the purpose of operating a hair dressing salon. A copy of the agreement is Exhibit 1.

The initial term of the lease was 5 years from 1 January 1992 to 31 December 1996.

Clause 11 of the Agreement which has given rise to this dispute is as follows:

“11.	If the Lessee shall during the said term pay the rent hereby reserved and observe and perform the conditions on the part of the Lessee herein contained and implied up to the expiration of the said term and shall have given notice in writing to the Lessor at least three calendar months before the expiration of this Agreement then the Lessor will grant an option to the Lessee for a renewal of the tenancy for the said premises for a further period of three years on the same terms and conditions except rental which shall be mutually agreed between the parties and failing such agreement the matter shall be referred to Arbitration pursuant to the Arbitration Act.”

The following salient facts which are not in dispute emerge from the minutes of the pre-trial conference held on 7 December 1999 and from the hearing of the action which took place on 27 November 2001.

On 26 September 1996 the Plaintiff exercised the clause 11 option. A copy of the Plaintiff’s letter to the Defendants is Exhibit 2. Although the Defendant did not reply to this letter it is accepted by the Defendant that the lease was validly renewed for a further period of 3 years expiring 31 January 1999.

Following the renewal of the lease differences arose between the parties as to the rent to be paid. These differences are not longer an issue between the parties.

Although the renewed lease expired on 31 January 1999 Mr. O’Driscoll told me that the Plaintiff remains in occupation of premises. He has continued to pay rent at the same rate of $517.00 per month which was approved by the Prices and Incomes Board in March 1997. Mr. O’Driscoll told me that the Plaintiff has not purported to exercise a further option to renew the renewed lease for a further 3 year period.

In September 1997 the Plaintiff commenced these proceedings. It will be seen that prayers 2 and 3 refer to the payment of rent which is no longer in issue. The first prayer seeks specific performance of the renewal option in fact exercised in September 1996 for a period expiring in January 1999.

When Counsel appeared before me I pointed out that the Plaintiff’s case as pleaded had been overtaken by events, among them the Defendants concession that the option to renew had been validly exercised in September 1996 and the Plaintiff’s failure to attempt to exercise the option again 3 months before the renewed lease expired in January 1999. In these circumstances no effective relief was being sought.

Mr. O’Driscoll then asked me to declare the Plaintiff’s present status given that he is still in occupation and still paying rent which I was told was being accepted by the Defendant’s without demur. However no such case has been pleaded and it would not be right for me to grant any relief, even declaratory in respect of something not pleaded.

Ms. Narayan, who filed a careful written submission, only addressed me on the construction of clause 11. She told me that she had understood from Mr. O’Driscoll that this was the sole matter for determination. She told me that she was surprised by Mr. O’Driscoll request that the Plaintiff’s present status be defined: she had not prepared herself for that submission.

The proper construction of clause 11 was first raised in paragraph 5 of the Statement of Claim, paragraph 5 of the Defence and paragraph 1 of the Reply. The question is an old one: does an option to renew “on the same terms and conditions except rental” mean that the renewed lease itself contains a renewal option; in other words that the lease is, at the option of the lessee, perpetually renewable?

The answer is that a lease may indeed contain a term or condition allowing perpetual renewal but the Court will not give a term or condition this effect unless the intention in that behalf is clearly shown (Baynham v. Guy’s Hospital (1796) 3 Ves. 295, 298). A provision that a new lease shall be on the same terms and conditions as the old lease does not entitle the lessee to have the renewal option inserted in the renewed lease unless the original provision expressly includes “the present term” or words to that effect (Parkus v. Greenwood [1950] Ch 644). The intention to grant an option to renew perpetually must be clear in the language of the lease (Brown v. Tighe (1834) 2 Cl. & Fin 396, 419). The fact that several renewals have been granted is not admissible to explain the intention of the parties to the lease (Baynham v. Guys Hospital ).

While for reasons already given I make no finding as to the Plaintiff’s present status in my opinion clause 11 of the lease does not grant the lessee an option for perpetual renewal and therefore whether or not the Plaintiff in fact purported to renew in 1999 the result is the same : the lease contains only one option to renew and that option has already been exercised.

M.D. Scott
Judge

21 December 2001