VICTORIA HOTEL

Evening Star, Issue 19856, 3 May 1928, Page 6

VICTORIA HOTEL

LANDLORDS SEEK POSSESSION ALLEGED BREACH OF LEASE TENANT REQUESTS RELIEF AGAINST FORFEITURE. A claim lor possession of the Victoria Hotel on the ground of an alleaged breach of a clause of the lease was heard in the Supreme Court today by His Honour Mr Justice Sim. The plaintiffs were Esther Eliza Ellis and Bruce Errington Burns, and the defendant was Donald Hutcheon. Mr J. S. Sinclair appeared for the plaintiffs and Mr W. G. Hay, with him Mr J. M. Paterson, for the defendant. There was also a claim by defendant for relief against forfeiture. In opening the case for the plaintiffs, Mr Sinclair said they were the registered owners of the fee simple of the property on which was the Victoria Hotel. In October, 1925, the defendant leased the property to Percy Georg© .Allan and Ivy Pringle for a term of six years at a rental of £l4 a week, the tenants also paying a goodwill of £3,500. Those tenants carried on till September, 1926, when the defendant bought them out and took a transfer of the lease. Defendant had been in the premises ever since. The lease contained a danse which sot out that if the tenant committed a breach of the Licensing Act or any other Act, and if his license were endorsed, the lessors were entitled to re-enter the premises. On November 12, 1927, the police raided the premises, and as a result defendant, on December 5, was convicted on two charges. The conviction the plaintiffs relied on was that of selling liquor during closing hours. li was claimed that, by reason of the conviction and the endorsement, the defendant had brought himself within the clause of the lease in regard to ih© right of re-entry. The proscribed notice under the Property Law Act was given to the defendant on February 20, 1928, aud on the expiry of a month the plaintiffs entered and determined the lease. The defendant had refused possession.

Bruce Erringtou Bums, one of the plaintiffs, said that on February 20 he arranged for notice to be sent to the defendant indicating the intention to determine the tenancy. In January witness had also asked defendant to vacate, hut defendant refused. Witness pointed out that defendant lad committed a breach by selling after hours, but he said he was only doing what many other publicans were doing. To Mr Hay: In December an arrangement was entered into on the plaintiffs’ behalf for the sale of the lease to a Mr Mlntosh for £3,000 for a three years’ lease, the rent to be £ll a week. Witness knew there had been correspondence indicating that Mr Hutcheon had attempted to remedy the breach. The substance of that was that Hutcheon offered to sell to a man and pay plaintiffs £4OO as damages. James M’lndoe, clerk of the Magistrate’s Court, gave evidence respecting the conviction of defendant. Witness produced the license, showing an endorsement by himself. It was usual for him to write the endorsement on a license. To Mr Hay: Ho was not present in court when the convictions were entered. He claimed that lie was entitled to make the endorsement. Mr Hay said it was denied there had been a breach of the lease. The question of relief came in, and ho would like His Honour to take the two matters together. His Honour intimated that he would hear the matters separately. Mr Hay said it was contended there had been no real endorsement on the license. The endorsement was not properly signed; it should have been signed by the convicting magistrate. On this occasion it was not even signed by the clerk of tho court who was officiating when tho case was heard. Mr Hay went on to say that it was claimed, if there had been a breach it could have been remedied. They had endeavoured to substantially remedy it, but the other side would not meet them. His Honour: Do you suggest a breach of this kind can be remedied?

Mr Hay replied that he did. Ho pointed out that it had been held that a personal endorsement was not of such a serious nature as to be a defect or blot on tho title, and could be remedied by the tenant not committing a further broach within two years. If there were no further endorsement witnin two years the first endorsement would ho worked out entirely. There was a distinction between a personal endorsement and an endorsement against the house. If the license were transferred to another person—as defendant wished to do—tho other person would come in under no cloud at all. Had defendant been asked to remedy a breach ho could have given the remedy proposed. In reply, Mr Sinclair said it was submitted that the broach was incapable of being remedied.

His Honour said ids presant opinion was that the plaintiffs were entitled to recover possession. He would, however, consider the matter further. In the meantime defendant had better go on with his application for relief. Mr Paterson submitted that it was a clear case for relief against forfeiture. It was contended that it was a case of unconscionable and harsh treatment by the landlord, of the kind that the court had referred to as the ground for relief. It was admitted that defendant had been inexperienced in the conduct of a hotel. The Victoria Hotel relied largely upon beer trade, its customers mainly being working men. Many of these worked out of town, and from (he nature of thpir employment required something to satiate their thirst during the weekends. Defendant admitted he yielded to temptation, and he was then caught by the police. It was not denied that the selling of liquor after hours was a serious offence, Hutcheon, however, denied that he sold liquor for consumption on the premises; what he sold wa,s taken away. The offence for which the defendant was convicted was not ' regarded by the Incensing Act itsa'f I as being very serious. Hutcheon realised that he would be better out of the business, and was prepared to transfer the lease. If forfeiture were granted, Hutcheon would lose something like £3,200 or £3,500. His mortgagees would certainly not get back what Hutcheon owed them, because they had a security over the lease and over the furniture, and only the proceeds of the furniture would be available, Defendant had offered the plaintiffs £4OO .as relief, and learned counsel contended that that was generous. Plaintiffs refused to consider the offer at all. When it was considered that an experienced man was willing to take a transfer of tho license from Hutcheon, that Hutcheon had offered a sum to cover plaintiffs’ expenses, and that _ the breach would be entirely remedied when a new man came in, the attitude- of the plaintiffs was perverse and unreasonable. It meant that, if forfeiture were granted, Hutcheon would be fined something like £3,000 or £3,500. Plaintiffs had suffered no pecuniary loss which could not be remedied by relief given by tho court. Evidence was given by John Lang, solicitor, that an offer was open from Mr Oldridge, of Christchurch, to take over the lease from Alf Hutcheon. Mr Oldridge offered to purchase the balance of Air Hutcheou’s lease for * £3,200, together with £SOO for the furniture. _ Hutcheon stated in evidence that it the lease were forfeited he would be

penniless. He had received offers to purchase the lease from him. To Mr Sinclair. Hutcheon said he made £6OO his first year in the_ hotel. He had no recollection of making an affidavit stating that he estimated he would make £3,000 a year. Mr Sinclair called Sergeant Dunlop, who said that Sergeant Turner and n« were detailed in October last to watch the hotel because of complaints r ' garding after-hour trading. it*’ detailed how large numbers of m i were seen going in and coming out or the hotel, some with handbags, some with parcels, and others with a bulging under their coats to suggest they had liquor. He went on to describe what happened and what was said when the police entered the premises. Further hearing was adjourned till the afternoon.