Malaya Cafe Bar & Restaurant v Shaw Brothers Ltd

JurisdictionSingapore
Judgment Date27 December 1990
Date27 December 1990
Docket NumberDistrict Court Appeal No 76 of 1982
CourtHigh Court (Singapore)
Malaya Cafe Bar & Restaurant
Plaintiff
and
Shaw Brothers Ltd
Defendant

[1990] SGHC 115

T S Sinnathuray J

District Court Appeal No 76 of 1982

High Court

Landlord and Tenant–Assignment of leases–No prohibition against assigning or subletting–Whether deed necessary for assignment of monthly tenancy on formation of and changes to partnership–Original tenant not made party to deed of assignment assigning tenancy to present partners–Whether present partners were lawful tenants of premises–Landlord and Tenant–Termination of leases–Original tenant formed and then dropped out of partnership–Constitution of partnership changed over time–Notice to quit addressed to original tenant but served on partners–Whether there was valid notice to quit to terminate tenancy of premises–Whether partners' admission of receipt of notice to quit rendered notice valid

The appellant was sued as a firm comprising of three partners. In July 1950, the respondent, owner of the premises, granted Su Jew Kheng (“Su”) a monthly tenancy of the premises. Su carried on business on the premises as a sole proprietor under the name “Malaya Cafe & Bar”. Su was not prohibited against assigning or subletting the premises. In February 1965, Su brought in some partners and the business became a partnership. In December 1978, Su withdrew from the partnership. On 30 April 1979, the then partners of the business assigned by deed the monthly tenancy of the premises to the present partners of the firm.

In May 1980, the respondent discovered that the present partners of the firm owned the business and that Su was no longer with the firm. The respondent then served a notice to quit addressed to Su and served on the appellant as the firm in occupation of the premises. The present partners took the stand that they were tenants of the premises and returned the notice to quit. The respondent then commenced proceedings on the ground that the partners were trespassers unlawfully in occupation of the premises.

There were two issues to be determined: (a) whether there was a valid notice to quit to terminate the tenancy of the premises; and (b) whether, by deed of assignment, the appellants were lawfully the tenants of the premises, either by assignment or estoppel. As to (a), the district judge held that the notice to quit was valid as it had been properly served on the appellant as agent for Su. As to (b), the district judge held that the partners who purported to assign the tenancy to the present partners had no right in the tenancy which they could assign because Su had abandoned the tenancy when he retired from the partnership.

Held, allowing the appeal:

(1) The appellant's admission in its defence to receiving the notice to quit addressed to Su did not mean that the notice to quit was valid as the appellant had also categorically pleaded that its contractual tenancy of the premises had not been determined by the respondent. By pleading in this way, the appellant gave notice to the respondent that it was for the latter to prove at trial that the notice was a valid notice: at [20].

(2) The notice to quit addressed to Su and served on the appellant was not a valid notice to quit and the appellant's tenancy was never terminated. Besides the notice to quit, the respondent did not produce any evidence to make good its claim that the tenancy of the premises had been properly terminated. Nor was there any evidence that Su had left the premises in the charge of the present partners. Thus, the proposition that where a tenant did not personally occupy the premises, the person whom the tenant left in physical possession to manage and control the premises might be deemed his agent for receiving service of a notice to quit, did not apply to this case: at [21].

(3) There was no evidence that the respondent had considered Su as its only tenant. The respondent was content to continue receiving rent, as it did over the years, from “Malaya Cafe” regardless of the composition of the firm. The respondent issued rent receipts in the name of “Malaya Cafe” and was not concerned as to the identity of the persons who managed or owned the business of the firm. The appellant was thus not trespassers on the premises: at [22] and [23].

(4) There was no legal impediment for the then partners of the firm to assign the tenancy to the present partners. Su was not a party to the deed as he was by then no longer a partner in the firm. When Su first took in partners from early 1965, the partners acquired an interest in the tenancy because the tenancy of the premises was an asset of the partnership business. When Su left the partnership, he merely ceased to have an interest in the tenancy of the premises, but the partners who continued in the business remained on the premises as tenants. There was no need for such changes to be effected by deed: at [25], [26], and [28].

(5) There was no prohibition against Su assigning or subletting the premises. The respondent could at no time have prohibited Su from sharing the tenancy of the premises with his partners and later, assigning it to them altogether before he withdrew from the partnership. Therefore, whether or not the respondent was aware of the changes in the partnership of the business of the appellants was not material: at [27].

Champion Motors (M) Ltd v Leong Siew Kwan [1968] 2 MLJ 31 (refd)

Chartered Bank (M) Trustee v Abu Bakar [1957] MLJ 40 (distd)

Eng Chuan & Co v Four Seas Communications Bank [1981-1982] SLR (R) 419; [1982-1983] SLR 8 (refd)

Lai Seng Fook v Tang Kong Low [1977-1978] SLR (R) 275...

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