Papua New Guinea Law Reports - 1976
[1976] PNGLR 22
N13
PAPUA NEW GUINEA
[NATIONAL COURT OF JUSTICE]
SEAFREIGHT PTY. LIMITED
V
BISHOP SHIPPING SERVICES PTY LIMITED
Waigani
Frost CJ
1-4 September 1975
5 November 1975
CONTRACTS - General offers and acceptance - Agreement contemplating execution of formal document - Licence agreement subject to formal agreement for sale - No binding contract for sale.
EJECTMENT - Claim for recovery of land and mesne profits - Holding over after expiration of licence agreement - Rent taken as measure of damages.
In 1974, the plaintiff (vendor) and the defendant (purchaser) entered into negotiations for the sale and purchase of a wharf and dock facilities. On 30th October, 1974, there being difficulties in relation to proof of title causing the defendant to refuse at that stage to enter into a contract of sale and lease, the parties executed an agreement the effect of which was that the defendant, as licensee, was given the right to use the wharf and facilities upon condition that the licensee should pay the licensor $6,000 per calendar month, the first three months to be payable in advance. The main provisions were that the licence which was to commence on 30th October, 1974, was revocable by one month’s notice in writing by either party after the expiration of the first three months, that the agreement was subject to the parties entering into a formal agreement for the sale by the licensor to the licensee of the property for $250,000 and the leasing of the land from the licensor to the licensee subject to the approval of the appropriate Minister within a period of three months from the date of the agreement; that in the event of the parties being unable to enter into such agreement within the three months the agreement was to be at an end. The defendant then went into occupation of the wharf and facilities and remained in occupation. No subsequent agreement of any kind was ever executed between the parties though the parties’ solicitors continued correspondence directed towards achieving that purpose and on 31st January, 1975, the defendant was informed by the plaintiff that “the deal was off”.
In an action by the plaintiff to recover from the defendant possession of the wharf and premises and for mesne profits,
Held
(1)      Subject to any right the defendant had under the licence agreement, there was no contract binding in law for the sale of the wharf.
Sinclair, Scott & Co. Ltd. v. Naughton (1929) 43 C.L.R. 310 at pp. 316-317, adopted and applied.
(2)      The words of the licence agreement, and considering that it was expressed to be subject to a formal agreement for sale and leasing, and considering the defendant’s refusal in October, 1974, to be committed to a formal contract for sale and leasing, did not support an option for sale or leasing.
Sinclair, Scott & Co. Ltd. v. Naughton (1929) 43 C.L.R. 310 at p. 318; Summergreen v. Parker (1950) 80 C.L.R. 304 at p. 316 referred to.
(3)      The only agreement between the parties was the licence agreement which came to an end after the expiration of three months, as no agreement for sale or lease was entered into within that period.
(4)      Accordingly the plaintiff was entitled as against the defendant to possession of the subject land and premises.
(5)      In addition the plaintiff was entitled to mesne profits, i.e. damages in respect of all loss suffered by him during the period of his dispossession; the normal measure for which is the rent paid by the party overholding.
Guthrie v. McCrindle (1949) 65 T.L.R. 192 referred to.
(6)      The defendant having accepted $6,000 per month as a fair and reasonable rental for the property, no other figure having been suggested as appropriate and noting that the gross rate of return though high, was within the rate of return at that time in the circumstances of a developing country, mesne profits should be assessed at the rate of $6,000 per month as from 31st January, 1975.
Action
This was an action by the plaintiff to recover from the defendant possession of a wharf and premises and mesne profits. It was not disputed that the plaintiff was at all times the proprietor of an estate in leasehold in the land; the real issues centered on whether certain negotiations, transactions and agreements as a result of which the defendant went into possession of the land, constituted a valid contract of sale of the said wharf and premises.
Counsel
JA Griffin for the plaintiff
C Darvall QC and RH B Wood for the defendant
Cur. adv. vult.
5 November 1975
FROST CJ:  This is an action by the plaintiff to recover from the first defendant possession of a wharf and premises to which it was not disputed that the plaintiff was at all material times the proprietor of an estate in leasehold, and also for mesne profits.
Both the plaintiff and the first defendant are shipowners. The wharf, which is situate at Voco Point, Lae, has a special commercial importance because apart from the wharf owned and operated on behalf of the Government it is the only wharf of any size available for shipping at Lae.
The first defendant relied in defence upon a licence agreement dated 30th October, 1974, and also, by way of counterclaim upon an oral agreement alleged to have been made with the plaintiff for the leasing and sale of the premises for the sum of $250,000, and in the alternative upon an option of purchase said to have been contained in the licence agreement.
Upon the counterclaim the defendant seeks specific performance of the alleged agreement and damages.
The second defendant to the counterclaim is joined by reason of the fact that on or about 15th January, 1975, the plaintiff as vendor entered into an agreement for the sale of the said premises to that defendant. As however the agreement was expressed to be “conditional in all respects upon the terms and conditions and rights of the vendor and Bishop Shipping Services Pty. Ltd. under the agreement of 30th October, 1974 being null and void or expiring on or before 31st January, 1975”, no argument was put before the court by that party.
The facts are that in August 1974, Seafreight and Bishop, as I shall refer to the first two parties, entered into negotiation for the sale and purchase of the wharf and dock facilities. Seafreight had obtained the use of other facilities at the main wharf including a stevedoring licence, and accordingly wished to dispose of the Voco Point wharf. Seafreight also had financial problems. Bishop was interested in purchasing because it had no stevedoring licence and so would be benefited by being able to stevedore its ships, and also avoid the charges levied upon the main wharf. Accordingly, negotiations began between Mr. Janus Spalvins, the Director and Acting Chairman of Seafreight, and Mr. Ross Bishop, the Managing Director of the defendant. The initial price sought by Seafreight was $300,000. As Mr. Bishop had no definite arrangements for finance his interest was centred on a lease for twelve months with an option to purchase. During negotiations Mr. Bishop seems to have relied upon an improvement covenant which was part of the Government lease, under which improvements of an approximate value of $80,000 were outstanding, to secure a reduction of the purchase price to $250,000. After several discussions at about the end of September or, from the correspondence, 6th October, 1974, it was eventually arranged that the defendant should enter into a lease for a twelve months’ period with an option of purchase, the monthly payments under the lease of $6,000 per month to be deducted from the purchase price of $250,000.
Subsequently Seafreight’s solicitors in a letter to Bishop dated 10th October, 1974, enclosed therewith “a very rough draft of the proposed lease and contract for sale”. The draft lease was for a period of one year commencing on 14th October, 1974, which was the following Monday, at a yearly rental of $72,000 to be paid as to $18,000 in advance or before 14th October, and thereafter monthly. Bishop was given an option of purchase for $250,000 “such option to be exercised by Bishop in writing on or before 15th October, 1974, on the terms and conditions contained and set out in the form of a contract of sale” annexed thereto. This rather unusual provision for the option to be exercised on the day after the commencement of the lease was very well appreciated, as appears from his evidence, by Mr. McKeague who was the solicitor who conducted the transaction on behalf of Seafreight. But whether this was contemplated by the parties during their verbal discussions does not appear from the evidence.
When Mr. Bishop took the draft documents to Mr. Love, the solicitor who conducted the transaction on his behalf, Mr. Love immediately drew attention to the improvement covenant which was set out in a copy of certain Land Board proceedings which were with the papers. He explained to Mr. Bishop that if the documents were executed Bishop would become responsible for the performance of the improvement covenant and would have no redress for moneys expended if it subsequently transpired upon investigation that Seafreight did not have a good title. Whilst the interview was being conducted, a search was made at the Registrar-General’s office from which it appeared that two of the three leases had been surrendered. In those circumstances Mr. Bishop accepted Mr. Love’s advice not to commit himself to the agreement pending investigation of title. But it was contemplated that this could be done within the next few weeks. In a telephone conversation with Mr. McKeague, Mr. Love suggested that there were various legal alternatives, such as a form of building lease, by which the transaction could go forward, and he would send further comments upon the drafts. (In fact, no such comments were ever sent.) In the meantime he suggested that the parties should enter into a licence agreement, and it was eventually arranged between the solicitors that Mr. Love should prepare a licence agreement to be brought back from Port Moresby to Lae for execution by the parties. Apparently it was executed by Bishop in Port Moresby but, in the event, the agreement dictated by Mr. Love was, with certain amendments, the agreement executed on 30th October, 1974, by both Mr. Spalvins and Mr. Bishop when they met in Lae. Consistently with those arrangements it was recited in the agreement that “the parties hereto have been negotiating the sale by the licensor to the licensee of the said land and improvements on certain terms and conditions” including the licensee entering into a lease, the effect of which was not destroyed by the apparent explanation in a later recital that “certain delays have been experienced concerning the proper documentation of the lease and agreement for sale”.
On that occasion, Mr. Spalvins requested Mr. Bishop to enter into the contract of sale and the lease, but Mr. Bishop refused to do so because of the difficulties over the title. It was in those circumstances that the licence agreement was executed between the two parties. The effect of the agreement was that Bishop as licensee was given the right to use the wharf and wharf facilities upon condition as follows: the licensee should pay the licensor $6,000 per calendar month, the first three months of which was to be payable in advance on the licensee taking possession, or 30th October, 1974, whichever was the earlier. The main provisions were that the licence which was to commence on 30th October, 1974, was revocable by one month’s notice in writing by either party after the expiration of the said period of three months from 30th October, 1974; that the agreement was subject to the parties entering into a formal agreement for the sale by the licensor to the licensee of the said land for the sum of $250,000 and the leasing of the said land from the licensor to the licensee subject to the approval of the appropriate Minister within a period of three months from the date of the agreement; that in the event of the parties being unable to agree on the terms and conditions of the agreement for sale and lease and entering into such agreement within the said period of three months the agreement was to be at end; and that all moneys paid under the agreement by the licensee were to be taken into calculation of balance of moneys due to the licensor in the said agreement for sale and lease.
Following the agreement Bishop went into occupation of the wharf and facilities and remains in occupation. No subsequent agreement was ever executed between the parties for the sale or leasing of the wharf or otherwise in relation to it.
I should refer to two letters from Bishop’s solicitors to the plaintiff’s solicitors which were forwarded prior to the licence agreement being executed. In the letter dated 14th October, 1974, enclosing the draft licensing agreement, reference was made to the draft licence being entered into “pending the negotiation of final contracts”, and in the letter of 16th October reference was made to attempted searches of the title and an arrangement to contact the plaintiff’s solicitors as soon as complete searches were available “concerning the draft agreement for sale and lease submitted” to Bishop. Both letters support the clear inference that at that stage there was no binding contract apart from the licence agreement.
In the ensuing three months after the licence agreement was entered into the search of the title proved to be a much longer procedure than Mr. Love orginally contemplated would be necessary. There is no need to go into the difficulties concerning the title which related to each of three allotments. There were notes in the Government files that two of the leases had been surrendered and the lease in relation to the allotment below high water mark understated the area. Another difficulty was that at this time the Department of Lands’ files were in the process of being moved from Konedobu to Waigani and there was a period when Mr. Love was unable to gain access to them.
I would infer from the letter of 6th December, 1974, by Seafreight’s solicitors to Bishop’s solicitors, in which it was stated that the present arrangements for occupation of the property by Bishop would come to an end on 31st January, 1975, and if a contract was not then duly executed any rights or option, if any, that Mr. Bishop had would cease, that Seafreight were concerned about the delay. Indeed for reasons which were not adverted to in the evidence, and which are thus a matter of speculation only, Seafreight lost interest in concluding any further arrangements with Bishop, for towards the end of the month the company’s officers in Lae had already started negotiations with the defendant Namasu Wharfs Pty. Ltd., which I shall refer to as Namasu, for the sale to that company of the wharf and its facilities, at the same price of $250,000 as was being negotiated with Mr. Bishop.
In January 1975, it is clear that Mr. Love, too, was concerned about the passage of time and his inability to resolve the question of title. In a letter dated 8th January, 1975, referring to the “proposed purchase from Seafreight Pty. Ltd.” he wrote to the Director of the Department of Lands, Surveys and Mines stating that it was essential that full particulars of the title should be ascertained, and asking for advice as to specific matters concerning the title. The reference in the letter also to Bishop desiring to purchase and to the fact that “it will be a term and condition” of the contract that the improvement covenant would be complied with supported the view that at that stage there was no concluded contract between the parties.
On or about 15th January, Mr. Love spoke to Mr. McKeague on the telephone and requested Mr. McKeague to let him have a final form of contract as soon as possible. This was obviously a request embarrassing to Mr. McKeague because at this stage the agreement with the defendant Namasu must have been made and was, at the least, about to be executed, for it bears date 15th January Mr. McKeague stated in evidence that he told Mr. Love he would do his best to send such a final form of contract, but whether he used some words of private reservation I am satisfied that he gave Mr. Love the impression that he would send such a form of contract. As between solicitors, it is unfortunate that Mr. McKeague after obtaining instructions from Seafreight not to submit a final contract did not inform Mr. Love accordingly.
At this stage, when time was running out, Mr. Love had obtained an appointment with Mr. Logan, the Assistant Director of the Department of Lands, concerning the completion of the improvement covenant. The interview took place on 29th January, when for the first time Mr. Love became satisfied that Seafreight did have a good title to the land comprising the wharf and its facilities. Arrangements for the outstanding improvement covenant were also satisfactorily made because Mr. Love was able to obtain an assurance that the Department would accept Bishop’s undertaking that the outstanding matters under the covenant would be completed within a period of twelve months from the contract.
Because of a breakdown in telephone communications between Lae and certain parts of Port Moresby, which had persisted for a period apparently of about two months, it was necessary for Mr. Love to arrange for Mr. Bishop to request a final form of contract from Mr. McKeague. On 30th January, Mr. Love by telegram advised Mr. McKeague that it was essential that he have a contract for signature prior to the 31st. Mr. Bishop, after many unsuccessful attempts, in the late afternoon got through on the telephone to Mr. McKeague, and I accept his evidence that Mr. McKeague said he was working on the contract and would let him have it the following morning. I am quite unable on this point to accept Mr. McKeague’s evidence that he informed Mr. Bishop in effect that the deal was off. That information was not imparted to Mr. Bishop until the next day when he got through on the telephone to Mr. Spalvins, who was in Brisbane, and the latter said he did not intend to go on with the contract. Thereafter Bishop’s solicitors made tenders of purchase money on the basis that there was in existence a valid contract of sale of the premises to Bishop.
The reason for Mr. Love and Mr. Bishop seeking from Seafreight’s solicitors a contract merely, without reference to a lease, was that during December and January Bishop’s financial position had altered, for Mr. Bishop had obtained from his bankers an assurance of a loan sufficient to enable him to make immediate settlement under a contract of purchase. He had thus ceased to be interested in any lease.
The legal implications of these transactions between the parties may now be considered Mr. Darvall’s main submission on behalf of Bishop was that a contract for the sale and lease of the wharf was concluded upon the verbal agreement between Mr. Spalvins and Mr. Bishop at about the end of September or early October, and prior to the negotiations between the solicitors, but in my opinion this submission must fail. As it was said by the High Court of Australia in a case in which the Court was concerned with the sale of a large leasehold cattle station situated in south-western Queensland, the transaction was one of some magnitude and the parties could scarcely have regarded the sale of Crown leases involving the special subject matter of a wharf and some underwater land “as a dealing needing no special provisions or investigations”. Sinclair, Scott & Co. Ltd. v. Naughton[xiii]1. As in that case what the parties did was to discuss and agree upon matters of financial importance and the structure of the legal arrangements whereby the transaction was to be effectuated. It is clear that by referring to a lease and an option of purchase that the parties had in mind the completion of formal legal documents. There was no point in putting the matter in the hands of solicitors until at the least the price had been agreed to. I agree also with Mr. Griffin’s submission that any such agreement lacked certainty, particularly in relation to the settlement date, the provision for the option of purchase and the improvement covenant. Further, no weight can be given to Mr. Spalvins’ statement that he had agreed at that stage upon terms which were only later drafted by his solicitor.
As in the case referred to I do not consider that “the parties gave their final consent to terms by which they were content to be bound as a complete and exhaustive statement of their rights and liabilities” —[xiv]2. The following passage from the judgment is, in my opinion, also applicable to the present case, bearing in mind the different nature of the formal documents to be completed:
“.... We think, as a matter of construction, that the execution of the further contract was a condition or term of the bargain and not a mere expression of the desire of the parties as to the manner in which a transaction already agreed to will in fact go through (Von Hatzfeldt-Wildenburg v. Alexander ([1912] 1 Ch. 284 at p. 289)). There was not a final consent of the parties such that no new term or variation could be introduced in the formal document to be prepared (Pollock on Principles of Contract, 9th ed., p. 47). On the contrary the formal contract might contain other terms than those which appear from or are alluded to in the letter, which expresses an agreement to make an indeterminate contract. (See Rossdale v. Denny [1921] 1 Ch. 57, at p. 67, per Lord Sterndale M.R., and Chillingworth v. Esche [1924] 1 Ch. 97, at p. 114 per Sargant L.J.). The case is not one in which the parties were content to be bound immediately and exclusively by the terms which they had agreed upon whilst expecting to make a further contract in substitution for the first contract, containing, by consent, additional terms ... We think that the preliminary agreement of the plaintiff and defendant was directed to the making of a formal contract which alone was to constitute and regulate the sale and purchase of the station.
It follows that a contract binding in point of law was not concluded.”[xv]3
This conclusion is supported by subsequent events whereby Mr. Bishop, on 30th October 1974, refused to commit himself to purchase or lease the property, and the several references in correspondence by his solicitor to the purchase being still still under negotiation.
To refer to various subsidiary arguments, Mr. Darvall relied upon the “rough draft”, as it was described by Mr. McKeague, of the contract of sale and lease as a formal offer by Seafreight which remained capable of acceptance throughout the three months’ period. On the whole, however, I consider that Mr. Griffin’s submission that it was a mere invitation to treat is sound. There is no evidence that it was in conformity with the parties’ verbal arrangements that the option for purchase was to be exercised on the day after the lease was entered into, and there are a number of provisions contained in both documents which would seem likely to require further negotiations. Having regard to the magnitude of the transaction and the rapidly-changing political and commercial situation in Papua New Guinea during the time the country approached Independence, if, contrary to my opinion, there was an offer it certainly lapsed prior to the expiration of three months. Not by way of hindsight but as illustrations of the rate at which commercial arrangements become out-of-date, it is sufficient to refer in December to the change in Mr. Bishop’s financial policies which led him to prefer an immediate purchase without a lease, and the need for revision of the date originally provided for settlement and the term dealing with the improvement covenant.
Further, if there had been such an agreement as alleged, Mr. Bishop’s refusal to complete on 30th October could only be construed as a repudiation of it, which was accepted by Seafreight in entering into the licence agreement, or an agreed dissolution of the agreement.
Accordingly, subject to any right Bishop had under the licence agreement, in my opinion there was no contract binding in law for the sale of the wharf between the parties.
The alternative argument advanced by Bishop’s counsel was based upon the provisions of the licence agreement. At the outset I should state that both parties conceded that the time for entering into the formal agreement expired at the end of the day of 30th January, 1975. (In fact, of course, there never was such a formal agreement nor, as I have held, any concluded agreement). In my opinion the words of the licence agreement simply cannot support an option for sale or leasing. Further, it is expressed to be subject to a formal agreement for sale and leasing. In all the circumstances, including Mr. Bishop’s adamant refusal, which as I find occurred on 30th October, 1974, to commit his company to the contract and lease, and the whole of the provisions contained in cl. 4, there is no room for the implication submitted by Mr. Darvall that the further contract was to be a mere formality to be entered into by parties already bound. Rather, to use the words of the High Court judgment, “the execution of the further contract was a condition or term of the bargain” —[xvi]4. The provision for the licence moneys to be taken in part-payment of the purchase price does not affect this conclusion because, as Mr. Griffin submitted, it is conditional, upon the proper construction of the agreement, on an agreement for sale and lease being entered into.
The provision in the agreement that in the event of the parties being unable to agree on the terms and conditions of the sale or lease, it was next contended, supported certain implied terms including such as to act reasonably and co-operate with Bishop in drafting a contract for lease and/or sale of the wharf, conscientiously to endeavour to agree upon a form of contract of sale and/or lease and to take all such steps as might reasonably be necessary to clarify title or as might be reasonable in co-operation with Bishop to draft a contract within the terms orally agreed between the parties. However, this argument was plainly answered by Mr. Griffin’s submission that as a matter of established law there can be no agreement to enter into an agreement. In the words of Latham C.J. in Summergreen v. Parker[xvii]5, “The parties to a contract may bind themselves under a contract which is complete in itself to leave specified matters to be determined by a third party, ... but it is a quite different thing to provide that the actual terms of the contract shall depend upon what some two persons shall agree. There is no legal means of compelling any persons to agree upon anything.” Thus, as Mr. Griffin submitted, throughout January, Seafreight was entitled to resile from the negotiations. There was no act or omission on Mr. McKeague’s part, or on the part of any of Seafreight’s officers, which constituted a breach of contract by the plaintiff.
Mr. Darvall also relied upon a passage from the judgment in Mackay v. Dick[xviii]6 as follows:
“I think I may safely say, as a general rule, that where in a written contract it appears that both parties have agreed that something shall be done, which cannot effectually be done unless both concur in doing it, the construction of the contract is that each agrees to do all that is necessary to be done on his part for the carrying out of that thing, though there may be no express words to that effect.” — per Lord Blackburn at p. 263.
The rule, however, is dependent upon there being a pre-existing agreement between the parties. From it arises the implied obligation, for example, of a party to provide further assurances under a contract for the sale of land. See also Colley v. Overseas Exporters[xix]7 for such an implied term under a contract for the sale of goods. However, the rule cannot assist Bishop in this case because in my opinion there was no concluded agreement between the parties.
Similarly the reference in Heyman v. Darwins, Ltd.[xx]8 that, “It is familiar law that a party who has prevented fulfilment of a condition precedent cannot set up the fact of its non-fulfilment.” — per Lord Wright, is also dependent upon there being a pre-existing concluded agreement.
Although it is not necessary for my decision I should refer briefly to Mr. Darvall’s submissions on part-performance and equitable fraud, there being no note or memorandum of the contract sufficient to satisfy the Statute of Frauds. None of the matters relied upon, in my opinion, is referable to the alleged oral agreement or falls within the doctrine of part-performance. The doctrine of equitable fraud is also inapplicable, because there was no agreement between the parties and therefore no obligation upon Seafreight or its solicitors to submit any contractual documents. Wakeham v. Mackenzie[xxi]9.
The conclusion which I have reached is that the only agreement between the parties is the licence agreement which under cl. 4 came to an end after the expiration of three months as no agreement for sale or lease was entered into within that period. It was not argued that the plaintiff’s claim for possession was dependent on one month’s notice being given and, in my opinion, the provision for one month’s notice was inapplicable. Accordingly, the plaintiff is entitled against the defendant to possession of the subject land and premises.
The final matter is the plaintiff’s entitlement to mesne profits. “Any person wrongfully dispossessed of land has, in addition to a right of action for the recovery of the land, a right of action for damages in respect of all loss suffered by him during the period of his dispossession. Such an action is termed an action for mesne profits.” Salmond on Torts, 16th ed., p. 576.
The loss recoverable clearly extends, but is not limited to the rental value of the land. Normally the rent paid by a party overholding is taken as the measure for loss of that nature. Guthrie v. McCrindle[xxii]10. But two objections have been made by Mr. Darvall to that approach in this case. First, it is said that the sum of $6,000 per month fixed by the licence agreement is excessive having regard to the rate of return on capital. Thus $6,000 per month amounts to over 29% per annum return on a capital value of $250,000. It was also contended that the rate was fixed to cover not only rental value, but also some additional sum by way of purchase money or perhaps to cover interest on the unpaid purchase price.
As to the first objection, however, I accept Mr. Tonkin’s evidence that $6,000 per month was accepted by Mr. Bishop as a fair and reasonable rental for the property, and also Mr. Spalvins’ evidence that no other figure was suggested by Mr. Bishop as an appropriate rental. It is true that the gross return is high by Australian standards — both parties are Australian — but the rate fixed is within the rate of return required at that time and indeed still required by property owners in the circumstances of this developing country. A statement made by Mr. Watter was relied on, that a lower return could be expected for a structure of a “heavy, rough, stable nature and durable” such as a wharf, than if the structure were flimsy, subject to deterioration in paint decoration. But there was no evidence as to the rate of deterioration of a wharf or property subject to sea-water. In any event, no such reduction was sought by Mr. Bishop, who as a shipowner would be expected to be familiar with the rental value.
As to the second objection, the fact that the licence fee was to be taken in part-payment of the purchase price is, in my opinion, not material in view of the conditional nature of the licence agreement, so that it was within the contemplation of the parties that it no contract of sale or lease was entered into, the sum paid would be treated as a licence fee only.
Finally, an argument was put based upon the costs at the Government wharf, as a guide to the rental value, but on the whole of the evidence I do not find it helpful. I would therefore assess mesne profits at the rate of $6,000 per month as from 31st January, 1975. There will be judgment accordingly for the plaintiff on the claim, and both defendants on the counterclaim.
Judgment in the action that the plaintiff recover as against the defendant possession of the land wharf and premises being and comprised in allotments 26, 28 and 34 section 27, City of Lae, Morobe Province, recovery of possession to be stayed until 1st December, 1975, together with mesne profits calculated at the rate of K6,000 per month as from and including 31st January, 1975, viz. in the sum of K60,000, stay of judgment for such sum until 30th November, 1975, the defendant to pay the plaintiff’s taxed costs of the action.
Judgment in the counter-claim for the defendants by counter-claim together with costs to be taxed.
Orders accordingly.
Solicitors for the plaintiff: Gadens.
Solicitors for the defendant: McCubbery Train Love & Thomas.

[xiii](1929) 43 C.L.R. 310, at pp. 316-317.
[xiv](1929) 43 C.L.R. 310, at p. 316.
[xv](1929) 43 C.L.R. 310, at pp. 317-318.
[xvi](1929) 43 C.L.R. 310, at p. 318.
[xvii](1950) 80 C.L.R. 304, at p. 316.
[xviii](1880-81) 6 App. Cas. 251.
[xix][1921] 3 K.B. 302.
[xx][1942] A.C. 356, at p. 387.
[xxi][1968] 2 All E.R. 783 at p. 788.
[xxii](1949) 65 T.L.R. 192.