Petaia v Esera [2023] WSSC 83 (5 December 2023)

THE SUPREME COURT
Petaia v Esera [2023] WSSC 83

Case name:	Petaia v Esera
Citation:	[2023] WSSC 83
Decision date:	5 December 2023
Parties:	FEO PETAIA v APISAI ESERA
Hearing date(s):	28 November 2023 (Ex-Parte Application)
File number(s):
Jurisdiction:	Civil
Place of delivery:	Supreme Court of Samoa, Mulinuu
Judge(s):	CHIEF JUSTICE PERESE
On appeal from:
Order:	- The defendant, his relatives and agents are required, within 24 hours of the service on his solicitors of this judgment, to remove off the land all obstructions and other material that have been used to prevent entry to the plaintiff’s building. The defendant is also to have the power and water reconnected at his expense, and hand over to the plaintiff the keys to the changed locks. - The defendant, his relatives and agents are thereafter prohibited from entering the leased property at Lotopa, without express permission of the court; - In the event the defendant fails to carry out the orders set out in a. above, the plaintiff may cause to remove the obstructions placed by the defendant, reconnect the power and water, cut new keys, and enter-into possession of the leased land and building, with the cost of the work required to be undertaken to enable the entry into possession being deductible from future rental payments.
Representation:	M G Latu for plaintiff
Catchwords:	Deed of lease – application for interim injunction – balance of convenience –
Words and phrases:
Legislation cited:
Cases cited:	Mulholland v Waimarie Industries Ltd [2009] NZHC 554; (2009) 10 NZCPR 590, 593-594
Summary of decision:

IN THE SUPREME COURT OF SAMOA
HELD AT MULINUU

CP 105/23

BETWEEN

FEO PETELO
Plaintiff

A N D

APISAI ESERA
Defendant

Counsel:
M G Latu for Plaintiff

Hearing: Ex-parte application dated 28 November 2023

Decision: 5 December 2023

DECISION OF PERESE CJ

1. On 28 August 2018 the plaintiff entered a deed of lease (“lease”) with the owner of the land KALE ESERA to lease land described in the first schedule of the lease.
2. The period of the lease commenced on 28 September 2018 for an initial term of 10 years (with a right of renewal, for a further 10 years); the rent payable was $800 per month in advance terms. Rent was agreed to be reviewable at three yearly intervals with any increase to being “mutually agreed between the parties taking into account rental for similar properties”. The tenant was responsible for outgoings as defined in the lease. The lease contained bespoke clauses covering the tenant and landlords obligation. The rent review clause 20, was set out under a section heading “mutual agreements”.
3. On or about 24 August 2023, the defendant’s solicitor purported to give notice of a unilateral increase in the monthly rental from $800 to $960, with the first of the increased rent amount payable 4 days later, on 28 August 2023.
4. The defendant further threatened to terminate the lease if the increased rent was not paid.
5. The plaintiff did not agree to the increased rent and did not pay.
6. On or about 23 October 2023, the defendant re-entered the lease, for the plaintiff’s failure to pay the increased rent of $160, by blocking the entrances to the property by placing roofing iron and bricks and by changing the locks to the building. Water and electricity were disconnected on the 24 October 2023.
7. The building the defendant re-entered served as the plaintiff’s place of business and personal accommodation. When the defendant denied the plaintiff entry, he blocked access to the plaintiff and his family’s belongings, clothing, furnishings, and business computers and office equipment. A freezer containing frozen goods has no doubt been adversely affected by the disconnection of electricity.

Jurisdiction

8. Rule 196 of the Civil Procedure Rules provides that the court may consider an interlocutory application ex-parte, or without notice, if the Court is satisfied that the delay that would be caused by proceeding on notice would or might entail irreparable injury to the applicant. I am satisfied that irreparable injury would or might entail if there was delay caused by the application for interim injunction being dealt with on notice. Accordingly, the court has jurisdiction to consider this application.
9. Where the court is satisfied that it has jurisdiction the Court must then apply the normal principles that apply to interlocutory applications for interim injunctive relief:
   • (a) Is there a serious issue to be tried?
   • (b) Where does the balance of convenience lie?
   • (c) Overall justice of the case.
   • (d) ...

Serious issue

10. The plaintiff funded and had built the building on the land, which is the subject of the defendant’s lockout; it serves as both his business premises and personal accommodation. He estimates that he has so far invested $178,000 into the business in terms of various loans and personal contributions. Up until the re-entry, they were up to date with rental payments.
11. The defendants on the other hand, by a notice dated 3 October 2023, threatened that non-payment of $160 (being the increase by which they unilaterally reviewed the monthly rental), would be met any or all of the following actions: by locking and chaining up all entries to the premises, cutting off the electricity supply, cutting off the water supply, obtaining an order to levy distress. Indeed, on or about 23 October 2023, the defendant re-entered the lease as set out above.
12. The rental review is the issue in this case. The term of the lease concerning the right to review rent, clause 20, certainly seems to envisage the amount of the reviewed rent needing to be agreed between the parties. Clause 20 does not envisage unilateral reviews. The basis is of the increase is not clear to the court at this stage, however, it remains the case that the plaintiff did not agree to the increase.
13. How the rent is reviewed is a term of the contract. It maybe that the tenant is unreasonably withholding his consent, but that is a matter for trial. It is not for the landlord to take matters into his or her own hands and take very serious steps to enforce payment of a sum that he or she believes should be paid. It might also be the case the landlord’s rental increase is unreasonable because it hasn’t taken into account rental for similar rental properties (a requirement under clause 20).
14. I consider that there is a serious issue to be tried.

Balance of convenience

15. The plaintiff says that he is not confident that the defendant or the landlord can meet an award of damages. The Statement of claim seeks to recover the amount of money the plaintiff and his family invested in the building. However, the plaintiff appears to want the building back so they can continue to operate their business to meet their loan commitments and outgoings, at least until the Court clarifies the issue of rent review.
16. Neither the defendant nor the landlord have offered to compensate the plaintiff for the improvement to the land – the building. If the defendant has wrongly terminated the lease he and the landlord may be facing a significant claim for loss, not just for the building, but its contents, as well as economic loss from not being able to continue to trade. One can only surmise that if the building is locked up then no one has access to it, and so the landlord is not earning any money from the land.

Overall justice?

17. This case involves a very small amount of money - $160. Should the court intervene by granting an order for interim injunction in these circumstances?
18. On the plaintiff’s part, one might have thought he may have relied on his presumptive right at common law, that where a breach of a lease consists solely of a failure to pay rent, that once the debt and costs is paid in full the tenant is entitled to relief from forfeiture: Mulholland v Waimarie Industries Ltd [2009] NZHC 554; (2009) 10 NZCPR 590, 593-594. It would be difficult to see a court treat a payment made in these circumstances, with the appropriate reservation, as amounting to an acceptance of the new rent level. However, I note that the plaintiff’s counsel was unavailable to assist the plaintiff for a lengthy period after receipt of the defendant’s demand.
19. However, on the other side, are the quite extraordinary steps the landlord took to recover $160 allegedly due. The steps taken were outrageous. The defendant must have known the tenant objected to the unilateral rent review. Rather than seek to mediate the rent review issue, (the bulk of the rent still being paid), the defendant instead boarded up the entrances to the building, changed the locks and disconnected the power and water, because the defendant wanted $160 more.
20. I am unable to find any factors which might persuade against the making of an order for interim injunction. On the contrary, given the defendant’s intractable position, and the plaintiff’s urgent financial circumstances, the overall interests of justice are in favour of the making of the orders set out below.

Ruling

21. I am satisfied that whilst the substantive proceedings concerning the rent review and legality of the re-entry are being tried, the balance of convenience favours the making of the following orders, until further order of the court:
    • (a) The defendant, his relatives and agents are required, within 24 hours of the service on his solicitors of this judgment, to remove off the land all obstructions and other material that have been used to prevent entry to the plaintiff’s building. The defendant is also to have the power and water reconnected at his expense, and hand over to the plaintiff the keys to the changed locks.
    • (b) The defendant, his relatives and agents are thereafter prohibited from entering the leased property at Lotopa, without express permission of the court;
    • (c) In the event the defendant fails to carry out the orders set out in a. above, the plaintiff may cause to remove the obstructions placed by the defendant, reconnect the power and water, cut new keys, and enter-into possession of the leased land and building, with the cost of the work required to be undertaken to enable the entry into possession being deductible from future rental payments.
    • (d) Costs reserved.

CHIEF JUSTICE PERESE