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Contract - interpretation - time - computation of - clause requiring rent to be paid "within 7 days of the due date" - meaning of - period of computation beginning on first day of period stated
A lease agreement for a piece of land on which there was a filling station provided that the rent "shall be payable monthly in advance ... on or before the first day of each month." The subsequent clause provided that "In the event of the rent... being unpaid within seven days of the due date ... the owner shall be entitled at his option to cancel the lease forthwith". The lessee paid the rent for one month on the 8th of the following month, and the lessor sought to have the contract cancelled and the lessee evicted. The issue was whether the lessor was entitled to this remedy.
Held, that if the language used in the lease agreement is sufficiently clear in fixing the last day of payment, the court will give effect to the clear intention of the parties. On the other hand, if the language used in the lease is not sufficiently clear or explicit in fixing the last day of payment, the civil method of computation of time must be used, in which case the first day is included in, and the last day excluded from, the computation. "Within seven days of the due date" clearly means that payment is due within the first seven days of each month. The due date being the first day of the month, it follows that "within seven days" of that date must mean within a period of no more than seven days from due date, including the due date itself. In this respect the phrase "within seven days of due date" is clearly distinguishable and different from the phrase "within 15 days after the same should have become due". The phrase "within seven days of due date" suggests that counting starts from the due date
itself. Accordingly, the meaning of "within seven days of due date" is reasonably clear and it refers to the first seven days of the month, that is to say, up to midnight of the 7th day of each month. Consequently, payment of rent on the 8th day of the month would be a breach of the contract of lease, entitling the landlord to cancel the contract. The fact that the delay was merely one day would be wholly irrelevant to the plaintiff's entitlement to cancel the contract. As soon as the rent is not paid by midnight on the 7th of the month, the landlord acquires the right of cancellation. Whether rent is then subsequently paid does not affect this legal position, except where the acceptance of the rent amounts to a waiver of the right of cancellation.
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