Facts
- A lease provided that premises could only be used as a high class restaurant or night club, with a covenant prohibiting immoral use
- The premises were used for an immoral purpose (prostitution)
- The lessor commenced forfeiture proceedings
Issue
- Could relief from forfeiture be granted?
Decision
- Yes, exceptionally
Reasoning
- Usually, a breach of covenant against immoral use will not allow relief from forfeiture to be granted
- Exceptionally, such a relief can be granted (even though the lease had been forfeited)
- Exceptional circumstances here included
- the substantial loss which forfeiture would cause to the lessee (and windfall to the lessor)
- the fact that the immoral use had ended
- the fact that there would be no lasting stigma
- the fact that relief would not cause the lessor to be left with unacceptable tenants
- the fact that the lessee intended to dispose of the lease
