OGDE v. PEARL & DEAN (OVERSEAS) LTD [1961] 1 GLR 142

DIVISION: IN THE HIGH COURT, ACCRA

DATE: 3RD MARCH, 1961

BEFORE: OLLENNU, J.

CASE REFERRED TO

Moukarzel v. Hannah (1947) 12 W.A.C.A. 125

NATURE OF PROCEEDINGS

ACTION for recovery of rent for the unexpired portion of a renewed tenancy. COUNSEL

K. Ohene-Ampofo for plaintiff.

E.N.P. Sowah for defendants.

JUDGMENT OF OLLENNU J.

[His lordship referred to the facts and continued:] The defence to the claim for rents is that the option was never exercised by the company and that it could only have been exercised by notice in writing given by them to the plaintiff three months before the expiration of the original term of one year, and since no such written notice was given, the defendant company are entitled to vacate the premises at any time.

The main issue in the case is whether the defendant company exercised the option given them in clause 4(2) of the agreement. The determination of that issue depends upon the combined effect of certain clauses of the agreement, exhibit B. The agreement provided, inter alia, that the tenancy shall be ‘renewable and determinable” as hereinafter provided. There is only one clause dealing with renewal and only one clause dealing with determination. Clause 2, sub-clause (5), which deals with determination is as follows: “2. The Tenant agrees with the Landlord as follows:-

(5) At the end or sooner determination of the tenancy to yield up the premises, etc;”.and clause 4, sub-clause (2) which deals with renewal is as follows:

“That the Tenant shall have the option to renew the tenancy hereby created for a further term of 4 years at the same rent and subject to the like agreement and stipulations as are herein contained with the exception of this right of renewal Provided notice of its intention to renew the tenancy is given to the Landlord three months before the expiry of the tenancy hereby created”. One peculiar feature of these renewal and determination provisions in the agreement is, that each of them is at the election of the tenants; the landlord has no say in the matter. Even where the option to renew is exercised there is no need for him, the landlord, to grant any formal lease, the tenancy would continue automatically for another four years. I interprete those clauses, read together, as follows:- If the tenants should elect to determine their tenancy at the end of the one year they should surrender the premises to the landlord, but if they should elect to exercise the option then they should continue in occupation paying rents [p.144] of [1961] 1 GLR 142 at the same rate and in the same manner as they were paying during the term of one year, and in either case the landlord has no alternative but to accept his premises upon determination or to receive the rents upon the exercise of the option.

In those circumstances the provision for notice is just for the information of the landlord and nothing else.

Now what happened in fact is precisely what the said two clauses of the agreement provide. That is, at the end of the one year, the tenants elected not to yield up possession; on the contrary, they elected to continue in possession. In pursuance of that election they paid rents at the rate reserved in the agreement, i.e. £G275 per annum and paid it half yearly, i.e. in the manner provided by the agreement.

Again the said clause 4, sub-clause (2) which gave the option to renew, does not provide that the notice or information which is to be given to the landlord shall be in writing. It is true clause 4, sub-clause (5) says that:

“any notice required to be given hereunder shall be sufficiently given to the Landlord by hand or registered post to his address in Accra” which inferentially means that the required notice must be notice in writing.

But there again it will be seen that that provision is solely for the protection of the tenants. The sub-clause does not say that the notice shall be in writing, or will be sufficient if given in writing; no, it talks of sufficiency of the giving of the notice itself. In my opinion all that the clause seeks to do is to lay down what evidence shall suffice to prove that notice has been given, in case the landlord may dispute having had notice. I hold that the conduct of the defendant company shows that they did exercise the option and renewed the tenancy for four years, and that the plaintiff accepted the renewal of the lease as he was bound to do, not having any right under the agreement to refuse. I hold further that it is not necessary in an agreement of this nature that notice of the exercise of the option should be in writing: Moukarzel v. Hannah.1(1)

Having renewed the lease for four years, it was not open to the tenants to dispute their liability for payment of rents for the full period of the renewed term of four years.

There will be judgment for the plaintiff for £G320 16s. 8d. rents for the period from the 1st January,

1960 to the 28th February, 1961.

DECISION

Judgment for plaintiff.