PRESTIGE MOTORS LTD v MY TRUSTEE CO LIMITED [2021] NZHC 237

PRESTIGE MOTORS LTD v MY TRUSTEE CO LIMITED [2021] NZHC 237 [22 February 2021]IN THE HIGH COURT OF NEW ZEALANDAUCKLAND REGISTRYI TE KŌTI MATUA O AOTEAROATĀMAKI MAKAURAU ROHECIV-2021-404-80[2021] NZHC 237IN THE MATTER of Articles 9, 17A and 17B of Schedule 1 tothe Arbitration Act 1996 and s 253 of theProperty Law Act 2007BETWEEN PRESTIGE MOTORS LIMITEDApplicantAND MY TRUSTEE COMPANY (NIKOLASAND PETRA) LIMITEDRespondentHearing: 16 February 2021Appearances: G Morrison for the ApplicantD Purusram for the RespondentJudgment: 22 February 2021JUDGMENT OF GORDON JThis judgment was delivered by meon 22 February 2021 at 3 pm, pursuant tor 11.5 of the High Court RulesRegistrar/Deputy RegistrarDate:Solicitors: DK Law, AucklandVictorian Lawyers, Papakura, AucklandCounsel: G Morrison, AucklandIntroduction[1] The applicant, Prestige Motors Limited (Prestige) applies for urgent interimmeasures and relief regarding its tenancy of premises at 14–16 Dryden Place,Mt Wellington (the premises). Until it was locked out, Prestige ran its automotiveservices and repair business from the premises.[2] Prestige claims the respondent, My Trustee Company (Nikolas and Petra)Limited (MTC) has unlawfully purported to terminate its 1 May 2018 lease (thelease),1 evict it from the premises and deny it access to the premises on a number ofoccasions. Prestige claims it has suffered considerable losses because of MTC'sactions as it is unable to conduct its business.[3] The lease contains an arbitration clause. Pending any arbitration, Prestigeseeks interim measures under arts 9, 17, 17A and 17B of Schedule 1 of the ArbitrationAct 1996. Prestige seeks these measures to restore the status quo under the lease andto ensure that the MTC is prevented from taking action that is likely to cause harm orprejudice to the arbitral proceedings.[4] As an alternative, Prestige seeks orders under ss 253 and 256 of the PropertyLaw Act 2007 (PLA) on the grounds that it is in the overall interests of justice that theCourt grants relief and orders injunctive relief. This alternative was not pursued at thehearing.[5] MTC opposes the application.Background[6] Each party has filed affidavits. The evidence, in particular ofUditha Pallewatte, the founder and sole director of Prestige, and Stephen Penney, adirector of MTC, is detailed and extensive. Prestige and MTC disagree on most factualmatters. Decisions on those disputed facts will be for any arbitration. It is not possibleto resolve those issues on untested affidavit evidence. And, in any event, it is notnecessary to do so in order to determine the application.1 The lease is in the standard Law Society Sixth Edition form.[7] An undisputed fact is that Prestige and MTC signed the lease on 1 May 2018.Prestige is the lessee under the lease. MTC is the lessor.[8] MTC says Prestige breached the payment of rent covenant in the lease andowes it rent together with rates and insurance outgoings totalling $37,216.67, whichincludes 15 per cent interest. The amount without interest was said to be $32,362.32.(Prestige disputes this and says it is up to date with its payments of rent and outgoings).[9] On 14 October 2020, MTC served Prestige with a notice which purported tobe under ss 245(1)(b) and 245(3) of the PLA requiring Prestige to pay the outstandingamount of $37,216.67 in eight working days. (Prestige claims the notice is inadequateand does not comply with the cancellation code in the PLA).[10] MTC purported to cancel the lease on 14 January 2021.Prestige's submissions[11] Mr Morrison for Prestige submits Prestige satisfies the test in the ArbitrationAct. First, Mr Morrison submits there is a "reasonable possibility that Prestige willsucceed on the merits of the case"2 because:(a) the purported notice (the notice) from MTC did not comply with therequirements of s 245 PLA. In particular:(i) there was no supporting evidence (such as invoices) for theamount claimed;(ii) there was no explanation of Prestige's rights; and(iii) the period contained in the notice (eight working days) toremedy the breaches was less than the 30-day requirement inthe PLA.2 Arbitration Act 1996, art 17B(1)(c).(b) it has proprietary rights in the premises, including rights of renewaluntil 2036;(c) it did not breach any of the covenants outlined in MTC's claim;(d) MTC has not issued breach or cancellation notices for the new breachesnow alleged by MTC in its affidavits for the hearing, for damage to theproperty; and(e) MTC's conduct following the notice has breached Prestige's propertyrights, such as the right to quiet enjoyment (under s 218 PLA and cl 31.1of the lease).[12] Second, Prestige submits that the balance of convenience is in its favour3 as:(a) harm, irreparable by damages, will occur if the Court does not grant theorders sought. In particular, Prestige points to its proprietary rightsbeing infringed and claims it would be difficult and expensive for itsbusiness to move premises;(b) Prestige will lose staff and customers if the Court does not grant theorder, which is a consequence that cannot easily be compensated byway of damages; and(c) MTC may not be in a financial position to meet an award of damagesif that was the outcome of the proceeding or arbitration;[13] Third, Prestige submits the harm it will suffer outweighs the harm likely toresult to MTC, if the Court grants the measures4 because:(a) MTC will maintain its contractual protections under the lease. Prestigeclaims it will adhere to its obligations under the lease;3 Arbitration Act, art 17B(1)(a)).4 Article 17B(1)(b)).(b) Prestige has provided an undertaking as to damages dated 27 January2021; and(c) MTC has a prospective tenant for the premises. Prestige has attemptedto notify the third party of this application through MTC, but MTC hasnot responded to its correspondence.MTC's submissions[14] MTC's submissions are not focused on the test to be applied by the Court.Rather Mr Purusram for MTC addresses what he submits are four core issues. Imention three:5(a) Whether MTC issued a valid notice of intention to cancel the lease.MTC accepts the notice "lacked some elements" but Mr Purusramsubmits the circumstances make terminating the lease justified;(b) Whether Prestige's acts and activities in the premises have rendered thepremises dangerous, unsafe and illegal and thus the lease has beenterminated under cl 26.1 of the lease; and(c) Whether the lease has been frustrated because of Prestige's acts andactivities.[15] As to those issues, first, MTC submits that the circumstances surrounding thenotice served on 14 October 2020 make it valid. The notice annexed a spreadsheetcontaining information about the rent and outgoings it says were owed by Prestige.MTC claims Prestige acknowledged receipt of the notice.[16] While MTC accepts the notice may have "lacked some elements",Mr Purusram cites Kent Sing Trading Co Ltd v JNJ Holdings Ltd for the propositionthat if the error is minor, a lessee cannot claim they have not been sufficiently informed5 Both parties referred to matters relating to the use of the part of the premises on the first floor asa residential tenancy. This formed the basis of MTC's fourth "core issue". The facts are disputedand I put the issue aside in determining the application. I will however address the issue in relationto a condition. Refer [62] to [64] below.of the nature and extent of the breach.6 MTC also refers to Kent Sing Trading Co Ltdto support his submission that the underlying purpose of ss 245 and 246 of the PLA isthat the notice should allow the recipient to understand with reasonable certainty whatthey are required to do.7 MTC submits that its notice to Prestige enabled it tounderstand their requirements with reasonable certainty, and thus, the notice was valid.[17] Second, MTC submits Prestige's actions have resulted in the premisesbecoming untenantable and therefore the lease has been terminated. The leasestipulates at clause 26.1:Total Destruction26.1 If the premises or any portion of the building of which the premisesmay form part shall be destroyed or so damaged(a) As to render the premises untenantable then the term shall atonce terminate.[18] MTC refers to DFC NZ Ltd (in statutory management) v Samson CorporationLtd in providing a definition of "untenantable"8 as a substantial interference with thetenant's ability to enjoy, use and operate out of the premises that is more than atemporary disruption.9[19] In reliance on a report from Sheffield Fox International (insurance engineersand loss adjusters) dated 7 February 2012, MTC submits it would take approximatelyfour months to repair the damage to the premises. The lease is due to end on 30 April2024. MTC submits that taking these factors into account, the premises meet thedefinition of "untenantable". This is because the interference with the tenant's abilityto enjoy, use and operate out of the premises is not a temporary disruption.[20] MTC adds that the premises are a "dangerous building" under s 124 BuildingAct 2004.6 Kent Sing Trading Co Ltd v JNJ Holdings Ltd [2019] NZCA 388 at [109]–[111].7 Kent Sing Trading Co Ltd, above n 6, at [111].8 DFC NZ Ltd (in statutory management) v Samson Corporation Ltd (1993) ANZ ConvR 481 (HC).9 At 483.[21] Third, MTC submits the lease has been frustrated because a supervening eventhas occurred that makes performance of the contractual obligations impossible ordifferent from what parties intended when they entered into the contract.Relevant law[22] Article 9 in Schedule 1 of the Arbitration Act empowers the Court to grantinterim measures before or during an arbitration. The Court is restricted to the samepowers as those of the arbitral tribunal (under arts 17A and 17B). The Court'sjurisdiction is therefore auxiliary to, and complements and facilitates, the arbitralprocess. The ordinary jurisdiction for interim injunctions does not apply.10[23] Interim measures for restoring the "status quo" are flexible and can apply torestore the position prior to the conduct complained of and/or to relieve the effect ofany wrongdoing.11 In this case the interim measures sought are of a kind as definedin art 17 as being a temporary measure to:(a) maintain or restore the status quo pending the determination of thedispute; and(b) take action that would prevent, or refrain from taking action that islikely to cause, current or imminent harm or prejudice to the arbitralproceedings.[24] The Court will likely confine itself to consideration of the three criteria inart 17B(1)(a)–(c):12(a) Harm not adequately reparable by an award of damages is likely toresult if the measure is not granted;(b) The harm substantially outweighs the harm that is likely to result to therespondent if the measure is granted; and10 Safe Kids in Daily Supervision Ltd v McNeill [2012] 1 NZLR 714 (HC) at [18].11 At [23]–[27].12 At [30]–[31].(c) There is a reasonable possibility that the applicant will succeed on themerits of the claim.[25] The "reasonable possibility" test is applied the same way as the "seriousquestion to be tried" test in interim injunctions.13 The tests above are applied inreverse: first the Court asks whether there is a serious question to be tried, and thenthe first two factors are applied in a balance of convenience analysis.[26] In the arbitration context, it is less likely that public interest, third partyconsiderations or overall justice factors will be considered.[27] The continued infringement of proprietary rights can entitle the applicant toinjunctive relief, unless damages are an adequate remedy.14 Long-term rights ofoccupation (including rights of renewal) are valuable property rights concerning landthat are not readily compensable by damages, supporting the award of interimmeasures under the Arbitration Act.15[28] There is no specific reference to the provision of an undertaking as to damagesin art 17B(1). However, it can be assumed that if an applicant for interim measuresdoes not provide an adequate undertaking as to damages, then it will be much moredifficult for that party to satisfy a court or a tribunal under art 17B(1)(b) that, if therelief is not granted, harm to the applicant will outweigh the harm that is likely toresult to the other party.16Is there a reasonable possibility Prestige will succeed on the merits?(Art 17B(1)(c))[29] Prestige submits that MTC's cancellation of the lease is unlawful. That isbecause, Prestige says, the notice does not comply with the code for cancellation ofleases under the PLA.13 Safe Kids in Daily Supervision Ltd, above n 10, at [36]–[38].14 Kalmac Property Consultants Ltd v Delicious Foods Ltd [1974] 2 NZLR 631 (CA) at 637.15 Green Road Cattle Co Ltd v Southhead Holdings Ltd [2017] NZAR 714 (HC) at [36]–[37].16 DAR Williams et al (eds) Williams & Kawharu on Arbitration – Part II the Arbitration Act andits Amendments (2nd ed, online ed, LexisNexis) at 253.[30] The notice contains MTC's company name in full at the top, its address andGST number. It then states the notice is to "Udith Ravindra" (Mr Pallewatte's firstand middle names, although the first name is misspelled). Below that it says "(PrestigeMotors Ltd) Here after called the tenant". It then reads as follows:The Nikolas and Petra trustHERE BY SERVE THE TENANTUdith Ravindra(Prestige Motors Ltd)That the land lord is intending to terminating the lease on the 26/October/2020for outstanding monies owedThe total is $37216.67 This now includes the 15% interest.Please refer to spread sheet.Regards Stephen14/October/2020[31] Annexed to the notice is a schedule setting out payments said to be due forrent, GST on the rental amount and insurance and rates. There are then columns forthe total due, total paid and the alleged short payment. The dates in the schedule runfrom 1 May 2018 to 10 September 2020. The alleged outstanding payment is said tobe $32,362.32.[32] Section 243 of the PLA provides that a lease may be cancelled only inaccordance with ss 244 to 252 of the PLA. Sections 244 and 245 provide that noticemust be given by the lessor to the lessee prior to cancellation. The remainingprovisions relating to cancellation are contingent on valid notice under thosesections.17[33] If there has been arguable non-compliance, there will be a serious issue to betried (as to whether or not the notice was valid) and this provides support for theawarding of injunctive relief.1817 For example, the lessor's right to peaceably re-enter the property or apply for an order forpossession (ss 245(1) and 248–251 Property Law Act 2007).18 Leeann Yare Ltd v Carlton Gore Road Ltd [2019] NZHC 613 at [6]–[7].[34] A notice served under s 245 (breach of covenant to pay rent) must adequatelyinform the recipient of all of the following matters:19(a) The nature and extent of the breach complained about. This requiresthe alleged breach(es) to be clearly specified, by reference to specificcovenant(s) in the lease;20(b) The amount that must be paid to remedy the breach;(c) The period within which the breach must be remedied (which must notbe less than 10 working days after the date of service of the notice). Inthis case s 245C applied (COVID-19 outbreak extension of applicableperiods) so that the minimum time was extended to 30 working days;(d) The consequence that, if the breach is not remedied at the expiry of theperiod specified in the notice, the lessor may seek to cancel the lease inaccordance with s 244; and(e) The right, under s 253, to apply to a court for relief against cancellationof the lease, and the advisability of seeking legal advice on the exerciseof that right.[35] Prestige says that the notice took it by surprise. It says it had not been invoicedor otherwise charged for outgoings before and no source documents were provided insupport of the amounts claimed. Prestige claims it requested these invoices and sourcedocuments on multiple occasions without success (after service of the notice) and itwas up-to-date on rent, except for two months of COVID lockdown which it waswithholding in reliance on cl 27.5 of the lease. It ultimately paid those two monthsunder protest. I put all those matters to one side given that they are disputed by MTC.19 Section 245(3) Property Law Act.20 McConnell v McCormick [1929] NZLR 560 (SC) at 565–568. Also see Kent Sing Trading Co Ltd,above n 6, at [96] and [108]–[112] for discussion of a notice that the Court of Appeal heldadequately specified the nature and extent of breaches relating to rent and outgoings.[36] However, I accept Mr Morrison's submission that Prestige has an arguable casethat the notice was not valid.[37] The description of the nature and extent of the breach is inadequate. The noticedoes not specify any clauses of the lease nor sections of the PLA in reference toPrestige's alleged breaches. Although a spreadsheet was attached, no underlyinginvoices or calculations were provided for the outgoings. Mr Purusram points to cl 3.6of the lease (relating to outgoings) and submits that the details of outgoings were notrequired to be provided until after 31 March in each year of the term or other date ineach year as the landlord may specify. He submits details were therefore not due until31 March 2021. However, the schedule alleges outgoings for insurance and rates hadbeen outstanding since 1 October 2018.[38] The notice period for Prestige to remedy the alleged breaches by paying theamount said to be outstanding was only eight working days (taking into accountLabour Day). This period was significantly less than the 30 working days required.[39] There was no statement to the effect that if the breach was not remedied at theexpiry of the period specified in the notice the lessor may seek to cancel the lease inaccordance with s 244.21 The notice simply said the landlord is "intending toterminating the lease".[40] There is also no explanation of the right under s 253 to apply to a court forrelief against cancellation of the lease, nor does the notice inform Prestige of theadvisability of seeking legal advice on the exercise of that right.[41] I do not accept Mr Purusram's submission that the defects in the noticeamounted to minor non-compliance. There was non-compliance with four out of thefive statutory requirements. I also do not accept Mr Purusram's submission that thestatements of the Court of Appeal in Kent Sing Trading Co Ltd can be used in a broadbrush way in relation to all of the statutory requirements in making an assessment asto whether or not a deficiency or error in the notice is sufficiently minor. In that case,21 Section 244 provides the lessor may apply to a court for an order for possession of the land orre-enter the land peaceably.the Court of Appeal was considering only the requirement in s 245(3)(a) that the noticemust adequately inform the recipient of "the nature and extent of the breachcomplained about". The Court's considerations did not extend to the otherrequirements in s 245.22[42] Nor do I accept Mr Purusram's submission that the fact Prestige instructed itssolicitor after receiving the notice or that the actual date of the purported cancellationby MTC on 14 January 2020 excused non-compliance with the requirement to informof the advisability of seeking legal advice or the notice period respectively. As to thelatter, between the date of the notice on 26 October 2020 and purported cancellationon 14 January 2021, MTC took steps to forcibly evict Prestige. Those steps, whicharguably breached MTC's right to quiet enjoyment, were: forcibly re-entering thepremises; changing the locks to the premises; switching off all mains power to thepremises including phone and internet lines; putting up notices and removing Prestigesignage at the premises; and removing Prestige's property from the premises.Mr Penney does not deny that these steps occurred.[43] Nor do I accept Mr Purusram's submission that damage allegedly caused byPrestige to the premises and now detailed in Mr Penney's affidavit in opposition to theapplication justifies a deficient and thus invalid notice.[44] I also do not accept that cl 26.1 of the lease is engaged. Mr Purusram relies ontwo reports obtained by Mr Penney. One of the reports is from an electrical inspectorwho refers to what he describes as many unsafe issues which he noted on his inspectionof the premises on 5 February 2021 (in his affidavit in reply Mr Pallewatte deniescausing those issues). The second report is from Sheffield Fox International. Theyrefer to damage to the premises allegedly caused by Prestige (Mr Pallewatte deniescausing the damage). Sheffield Fox says the works specified could take up to fourmonths to return the premises to their original condition. Apart from electrical issues,none of the works in the Sheffield Fox report appears to be in the nature of health andsafety matters.22 Kent Sing Trading Co Ltd v JNJ Holdings Ltd, above n 6, at [95]–[111].[45] There are two difficulties Mr Purusram faces with his submission that cl 26.1applies. First, this provision in the lease is a separate provision from cl 8.1 whichplaces an obligation on the tenant to, among other things, maintain the premises.Clause 26.1 appears to relate to matters such as damage from fire or earthquake asopposed to a tenant's failure to maintain the premises, which is a separate obligation.[46] Second, I do not consider the work required to be done renders the premises"untenantable".23 The alleged damage lacks any degree of permanence. It is merelytransitory or temporary. In my view, the four months to repair the "damage" (some ofwhich in my view does not impact on tenantability e.g. replacing skylight panels,repairing damage to internal walls, cleaning surfaces) in the context of a lease whichwill not end until 30 April 2024, does not make the premises untenantable. I furthernote that MTC has apparently arranged to re-tenant the premises. It is difficult to seehow the premises may be untenantable so far as Prestige is concerned but tenantablefor a new tenant.[47] I also note, for completeness, the inspection reports relied on by MTC wereobtained following service of the notice. This is despite MTC having had theopportunity since 2012, when Prestige first began its occupancy of the premises andalso contractual rights under the lease, to inspect the premises at any time with priornotice. The evidence was that Mr Penney and the other director, Ms Keast, visited thepremises and used Prestige's services without raising any issues.[48] Finally, there is Mr Purusram's "frustration" submission. He submits thecommon law doctrine applies. He submits a supervening event makes furtherperformance of contractual obligations impossible or significantly different from whatthe parties intended when they entered the contract. He submits that the doctrine wascreated to address the hardship caused to the parties when the contract had notprovided for the event that affected it. In this case, he says, the supervening event isthe unsafe state of the premises.23 See generally DFC NZ Ltd (in statutory management), above n 8, and GP 96 Ltd v FN CustodiansLtd [2011] 12 NZCPR 489 (HC).[49] I do not consider that is an argument that is likely to succeed. All of the safetyissues referred to by the electrical inspector engaged by MTC are capable of eitherupgrading or repair, according to the report of the electrical inspector. Further, it seemsthat MTC acknowledges that the identified issues can be remedied given that it isproposing to re-tenant the premises.[50] For all the above reasons I consider there is a reasonable possibility thatPrestige will succeed on the merits.Is harm, not adequately reparable by an award of damages, likely to result if theapplication is not granted?[51] I have accepted Prestige's submission that there is a reasonable possibility thatits claim will succeed on the merits. It is arguable that Prestige's proprietary rightshave been and are being infringed. Long-term rights of occupation, including throughrights of renewal, are valuable property rights concerning land that are not readily ableto be compensated by damages, supporting the award of interim measures under theArbitration Act.24[52] I accept that Prestige will not be able to work, at least from the premises, andwill not be able to pay its staff. I accept that, in the circumstances, those staff mayfind alternative employment. I also accept Prestige may well lose customers, at leastin the short-term, as the removal of the signage from the premises makes it look asthough Prestige has ceased trading. I accept that these are losses that are not readilyassessable by way of damages.25[53] There is also some evidence from both Ms Keast and Mr Penney as to financialstresses with MTC's mortgage lender. This is relevant in considering whether ifPrestige was left to pursue a remedy of damages whether MTC would be in a financialposition to meet an award.[54] Finally, on this factor, I note that Prestige has attempted to submit the disputeto arbitration. MTC has not responded to Prestige's notice submitting the dispute to24 Green Road Cattle Co Ltd, above n 15, at[20]–[21] and [27].25 Fujiama Tepanyaki Japanese Restaurant Ltd v Morgan [2003] 5 NZCPR 369 (HC) at [42].arbitration despite several follow up communications. At the hearing I askedMr Purusram about MTC's position on arbitration. His response was that he did nothave instructions on that issue.[55] Taking all of the above into account, I accept that Prestige is likely to sufferharm that would not be adequately remedied by an award of damages if the applicationwere not granted.Will the harm suffered by Prestige substantially outweigh the harm that is likelyto result to MTC if the measure is granted?[56] MTC submits the undertaking as to damages given by Prestige is inadequateand submits that Prestige will not be able to pay the sum of $200,000, being theestimated cost to remedy the damage to the premises allegedly caused by Prestige.(As noted above, Prestige denies causing the damage). But in any event, theundertaking is only relevant to harm that would be caused by the making of the ordernow sought. There would need to be a causal connection between harm caused toMTC by Prestige moving back to the premises. The undertaking is not for the purposeof remedying other breaches, being damage to the premises now alleged in MTC'saffidavits.[57] In this case, if the measures are granted MTC will still have all of its contractualprotection under the lease.26[58] To the extent that MTC's prospective new tenant is relevant to the relief sought,I note that Prestige has asked MTC on three occasions to notify that third party of therelief sought. MTC has not responded to Prestige. Nor was the Court provided withany information regarding the prospective new tenant.[59] In conclusion on this factor, I consider that the harm I have found that will besuffered by Prestige substantially outweighs any harm that is likely to result to MTCif I were to grant the measures sought.26 This was a relevant factor weighing the harm in Green Road Cattle Co Ltd v South Head HoldingsLtd, above n 15, at [27] where the Court ordered interim measures to prevent an attempted evictionunder a lease.Three further matters[60] There are three further matters which need to be discussed. The first two canbe addressed by the imposition of conditions. I have already mentioned safety issuesarising out of the electrical report of 5 February 2021 obtained by MTC. Withoutaccepting that it was responsible for the issues identified by the electrical inspector,Prestige accepts that it should not re-enter the premises until those safety issues havebeen addressed by a qualified electrical worker and the issuing, by that worker, of acertificate of compliance; and that it will meet the cost of this work, subject to anylater apportionment. I will impose a condition to that effect.[61] The second issue relates to the alarm system. MTC's position is that Prestigehas removed the smoke detectors on the premises and that the wiring in the alarmsystem has been cut. That puts MTC at risk in relation to insurance. Again, withoutaccepting that it caused the damage, Prestige acknowledges that the absence of aworking alarm system and smoke detectors is an issue that the Court would consider.Mr Penney exhibits to his affidavit a report from "Kiwi Alarms" (undated) to installan alarm system including smoke detectors. The quoted price is $2,710 plus GST.Mr Morrison did not have instructions on whether Prestige would agree to a conditiondirecting that an alarm system be installed by Kiwi Alarms in accordance with theirquote. However, he was content to abide my decision on that issue and a directionthat Prestige is to pay for this work, subject to any apportionment as a result ofarbitration.[62] The third issue relates to the occupation of the first floor of the premises byMr Wimalawardana, a close family friend of Mr Pallewatte and business partner inanother venture. Mr Pallewatte says that Mr Wimalawardana uses the first floor as aresidence under an informal sub-lease arrangement from Prestige. Mr Pallewatte saysthat MTC and Mr Penney consented to this arrangement and they charge MrWimalawardana $50 a week for water usage.[63] Mr Penney adamantly denies that the lease of the commercial premisesincluded the use of the upstairs as residential premises. He says Prestige was onlysupposed to use the bathroom and kitchen for commercial purposes (i.e. related to thebusiness but not as part of a residential use).[64] Given this dispute and also given the obligations now imposed on landlordsunder the 2020 amendments to the Residential Tenancies Act 1986, I consider that there-entry I will order should exclude the use of the premises as a residence.Result[65] Until further order of an arbitrator or this Court, I make orders that MTC,including its directors, agents and contractors (specifically Stephen Charles Penney)are:(a) not to hinder, prevent or otherwise interfere with Prestige's peaceablere-entry to its premises at 14–16 Dryden Place, Mt Wellington (thepremises) under its lease from MTC dated 1 May 2018 (the lease);(b) to reinstate and provide all utilities to Prestige at the premises and underthe lease, including but not limited to turning on and leaving on themains power supply to the premises and providing new keys to anylocks that MTC has changed (or otherwise not hinder, prevent orinterfere with Prestige's replacement of, or key-cutting for, any suchchanged locks by a professional locksmith and turn on all utilities tothe premises, whether or not the sources of such utilities are located onthe premises);(c) not to enter the premises except with notice and for a proper purpose inaccordance with the lease;(d) not to interfere with any property, persons or business on the premisesin any way;(e) not to make or publish any statements that the lease has been terminatedor that are otherwise detrimental to Prestige's business, and take downor retract any existing publications or notices to that effect; and(f) to reinstate all property moved from or around the premises by MTC,including but not limited to signage, the emergency power generatorand televisions belonging to Prestige.[66] The orders in [65](a)-(f) above are subject to:(a) the prior inspection and certification of all electrical works at thepremises by an independent electrical inspector, to be appointed byagreement between the parties' solicitors. The costs of that inspection,any remedial works and certification will be met by Prestige, subject toany order of this Court or the arbitral tribunal apportioning such costs(if any);(b) The completion of the installation of an alarm system by Kiwi Alarmsin accordance with its (undated) quote annexed as Exhibit F to theaffidavit of Stephen Penney, dated 12 February 2021. The costs of theinstallation will be met by Prestige subject to any order of this Court orthe arbitral tribunal apportioning such costs (if any); and(c) A condition that the premises or any part of the premises are not to beused as a residence.[67] I grant leave to Prestige to apply for further orders from this Court as arerequired to facilitate its peaceable re-entry to the premises and resumption of itsoccupancy and business under the lease without interference from MTC (andspecifically Mr Penney).Costs[68] Prestige, as the successful party is prima facie entitled to costs. As I did nothear submissions on costs, costs are reserved. In the first instance, if the parties areable to agree costs, a joint memorandum should be filed within 15 working days of thedate of this judgment. In the event that the parties cannot agree, Prestige is to file andserve its memorandum within five working days of the date for the joint memorandum.MTC is to file and serve its memorandum within a further five working days. Costsmemoranda should not exceed four pages excluding any attachments. I will determinecosts on the papers.___________________________________Gordon J