leases – serving notice on a landlord

In the NSW Supreme Court case Stonewall Hotel Pty Ltd v Papantoniou [2017] NSWSC 964, the Court was asked to determine whether the tenant had given effective notice of exercise of option of the lease. On one occasion, the tenant had given notice to the landlord’s solicitor, and on another occasion by email directly to the landlord.

The definition of ‘landlord’ in the lease neither included nor excluded an agent acting on behalf of the landlord. The lease also did not provide the landlord’s contact details. At the time of receipt of the notice, the solicitor was engaged to act on behalf of the landlords. The behaviour of the parties after the notice of exercise of option was received indicated that the landlords knew of, and felt bound by, the exercise of the option. Taking these circumstances into account, the judge held that the solicitor had authority to receive notice on behalf of all lessors and the notice of exercise of option was therefore validly served by the plaintiff on the landlord.

The judge then briefly turned to whether the notice of exercise of option by email was validly served on the landlord. The landlord accepted that there was no issue with form or content of the notice, but sought to argue that it was not in accordance with s 170 of the Conveyancing Act 1919. Looking to the terms of the lease, the judge found that the notice could be served either in accordance with s 170 of the Conveyancing Act 1919, or by way of the “general law”. In this case, the latter was satisfied, and hence the tenant was deemed to have validly served and thereby exercised the option to renew.

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