Capponi v Bridge Housing Limited

[2021] NSWCATCD 17

Civil and Administrative Tribunal

New South Wales

Medium Neutral Citation:

Capponi v Bridge Housing Limited [2021] NSWCATCD 17

Hearing dates:

9 March 2021

Date of orders:

4 May 2021

Decision date:

30 April 2021

Jurisdiction:

Consumer and Commercial Division

Before:

J Alder, General Member

Decision:

1.The respondent is to pay the applicant the sum of $6,635.73 within 28 days.

Catchwords:

LEASES AND TENANCIES — Residential Tenancies Act 2010 (NSW) — Compensation — rent reduction — withdrawal of services — failure to repair — quiet enjoyment — non-economic loss — mould

Legislation Cited:

Residential Tenancies Act 2010 (NSW)

Civil Liability Act 2002 (NSW)

Category:

Principal judgment

Parties:

Cristina Capponi (Applicant)
Bridge Housing Limited (Respondent)

File Number(s):

SH 20/45319

Publication restriction:

Nil

REASONS FOR DECISION

Background

1. In February 2017 Cristina Capponi (tenant) entered into a residential tenancy agreement (RTA) in relation to a two bedroom unit at Henrietta Street, Waverley (Premises). The weekly rent is $218.66. The Premises are approximately 100 years old. The tenant has been a social housing tenant of the respondent since 2012, having lived in four different residences around Sydney.

2. On 28 October 2020, the tenant filed an application for orders under the Residential Tenancies Act 2010 (NSW) (Act) arising from alleged breaches by the respondent (Bridge) of its obligations under the RTA and the Act relating to mould issues. A copy of the RTA was not in evidence. It was submitted that Bridge manages the Premises on behalf of the owner, NSW Land and Housing Corporation (NSWLH).

3. In her application (subsequently amended), the tenant sought orders for:

1. compensation under s 187(1)(d) of the Act for breach causing:

1. economic loss in the sum of $9,303.46, being the depreciated value of damaged goods (alternatively $16,818.84, being the replacement value of those damaged goods); and

2. non-economic loss in the sum of $2,000 for loss of enjoyment, distress, anxiety, inconvenience and disappointment; and

2. a 30% rent reduction under s 44(1)(b) of the Act in the sum of $3,422 for the withdrawal or reduction of services and facilities for the period 28 October 2019 to 28 October 2020.

Total: $14,725.46 (alternatively $22,240.84); and

3. work to be undertaken to prevent mould and excessive moisture in the front bedroom, living area and kitchen of the Premises, pursuant to s 65 of the Act.

4. The applicant alleges a breach of:

1. s 63 of the Act for a failure by Bridge to maintain the Premises in a reasonable state of repair due to the severe mould; and

2. s 50 of the Act for a breach of her right to quiet enjoyment of the Premises.

5. The tenant’s main complaint is that since moving in she has experienced excessive damp and moisture and severe and overwhelming mould in the front bedroom, living area and kitchen and has made numerous requests for repairs to Bridge, who has failed to act.

Hearing

6. On 9 March 2021, the matter came before me for final hearing. The parties appeared by telephone in light of the current Covid restrictions. Sworn oral evidence and oral submissions were given by the tenant, her advocate Mr Martin Barker and Ms Collinge on behalf of Bridge.

7. To the extent necessary, the tenant submitted to the Tribunal’s monetary limit of $15,000.00.

8. The onus is upon the tenant to prove her claim on the balance of probabilities, which is the civil standard of proof.

Documents

9. The tenant relies on:

1. Folder of documents filed 19 November 2020 (pages 1 to 42)

2. Particulars of claim filed 10 December 2020 (one page)

3. Folder of documents (pages 1 to 221) filed 23 December 2020 (including a statutory declaration of the tenant)

4. Folder of documents (pages 222 to 385) filed 12 February 2021(including a second statutory declaration of the tenant)

5. Submissions filed 15 March 2021 (12 pages)

10. Bridge relies on:

1. Documents filed 18 January 2021

2. Documents filed 1 March 2021

3. Submissions filed 19 March 2021

Relevant legislation

11. Section 63 of the Act requires a landlord to provide and maintain the premises in a reasonable state of repair, having regard to the age of, rent payable for and prospective life of the premises.

12. However, section 65 stipulates that a landlord is not in breach unless it had notice of the need to repair or ought reasonably have known of the need to repair and failed to act with reasonable diligence to have the repair carried out.

13. Section 50 of the Act states that a tenant has a right to the quiet enjoyment the premises without interruption by the landlord or anyone acting on the landlord’s behalf.

14. The tenant also brings her claim under s 44(1)(b) of the Act seeking an order that the rent payable is excessive having regard to the reduction or withdrawal of services or facilities provided with the Premises.

Tenant’s evidence

15. She lives at the Premises with her 16 year old son.

16. She suffers from asthma.

17. She first smelt mould within the first month of moving in. She reported it a month later, in March 2017 by phone to the respondent. She also noticed paint bubbling on the walls.

18. In July 2017, Anglicare, on behalf of the tenant, arranged for mould specialists to conduct an assessment. The Mould Doctor provided a report dated 17 July 2017 which found: “there is visible mould infestation in the kitchen/meals area and bedroom 1”. “Moisture ingress… may be a result of building defects, condensation and elevated humidity levels. Elevated humidity levels have been detected.” A portable dehumidifier was recommended to reduce the relative humidity and control moisture. Cleaning and sanitising affected areas to eliminate the mould was also recommended, as was fogging to eliminate invisible airborne mould spores and other bacteria.

19. Bridge carried out some of the recommended remedial works, including fogging to “retard the growth of the mould”. Ms Capponi gave evidence that the fogging “seemed to control the problem for about a year.”

20. In mid-2018, she says the issue resurfaced, with the smell coming back, paint bubbling and the walls cracking. She says she notified Bridge: “at the end of 2018 and the start of 2019, I was speaking to Bridge repairs again.” The tenant’s correspondence reflects that on 18 February 2019, she emailed Bridge to report: “cracked ceiling and mould in the laundry area.” And on 13 March 2019, she emailed Bridge that the mould had resurfaced at a fast pace and was affecting her health. She says she was then continually ringing and emailing Bridge to request re-fogging treatment be carried out.

21. On 9 July 2020, she emailed Bridge to advise the mould had resurfaced.

22. On 30 July, she was advised by Bridge that there was no mould detected.

23. In September 2020, Bridge arranged for an independent assessment by Mr Rob Butler of Flood Restoration, who told the tenant there was a rising damp issue and that he would recommend removing the render on the lower, exterior of the Premises and injecting it with a substance that killed mould.

24. After she filed her Tribunal application, Mr Pender conducted a second inspection in November 2020 and told her there was a moisture problem and more ventilation holes could be added at the base of the building and the sunroom could be opened up to let in sunlight.

25. As a result of the mould, she has been unable to properly utilise the Premises as it is constantly damp and smells. She has suffered from sleepless nights, fatigue and her health has declined. Her clothes and bed sheets are damp. She is embarrassed to have people over and is distressed at losing personal items damaged by mould. She has had to constantly run fans and keep windows open in every room regardless of weather, constantly spray air freshener and her fresh food is spoilt. She has engaged professional cleaners to attend weekly to wipe down mould.

Loss

26. She relies on a depreciation table of 54 items allegedly affected by mould, including shoes (8 pairs), clothes, belts, bags/suitcases (12), fans x 4, smart watch, surfboard, furniture (wardrobe, drawers, tables, bookcase) kitchen utensils (frypan) whitegoods (fridge), musical instruments (electric violin, clarinet, saxophone), electrical items (phone charger).

27. She has individually costed the items based on a depreciated value and in the alternative, their current value, based on current advertised purchase prices.

28. She relies on her (unsigned and undated) statutory declaration as to her ownership of each item wherein she states her belief as to the year she purchased them (between 2012 and 2020). She has provided an estimated purchase price for each item. She has provided photos of each of the items as evidence of mould damage.

29. She obtained a quote from Chem-Dry to clean/treat 15 mould affected items for the purposes of her insurance claim. Some were unable to be cleaned (suitcase, blazer/jacket) and others could not be guaranteed they would stay mould-free.

30. She has had to throw away a lot of her items that have been mould damaged.

31. She relies on an email from Anglicare dated 4 August 2017 that states:

“We have observed a decline in her mental and physical health as a result of level of mould within her property and the stressors resulting from ongoing disputes with other tenants in her building.”

Bridge’s evidence

32. Bridge was first notified of mould when they received the Mould Doctor report on 4 August 2017 from Anglicare.

33. Bridge concluded from the report the mould was a result of poor ventilation and not structural issues. No previous tenant has ever complained of mould at the Premises.

34. Bridge reimbursed the tenant the cost to remove visible mould and treat the affected areas.

35. On 12 November 2017, a property scope was undertaken by Bridge and no mould issues were identified or reported.

36. On 17 December 2018, a property inspection was undertaken and again no mould issues were raised.

37. Some 18 months later, on 9 July 2020, Bridge received an email from the tenant that the mould issue had resurfaced.

38. On 16 July 2020, Bridge undertook an assessment and found no signs of mould. Brian Pender, Bridge’s Technical Scope Inspector/building consultant said: “the mould that the tenant described on her ceiling adjacent the laundry is not mould at all. It is a water stain from a previous leak within the laundry to unit 3 above”. Mr Pender also said that moisture was due to construction type of the building and lack of sunlight.

39. On 30 July 2020, Bridge emailed the tenant to advise her of Mr Pender’s conclusions and asked her to heat and ventilate the rooms regularly.

40. On 15 September 2020, an independent mould contractor, Mr Rob Butler of Flood Restoration Australia, investigated the presence of mould and moisture. The report corroborated Mr Pender’s conclusions as to no mould or odours present in the Premises, albeit there was some mould on some personal items. The report concluded that there were high levels of moisture and a rising damp on walls, skirting and floorboards in lounge, second bedroom and hall. He concluded, given the age of the house (1920s), that the damp proof course had failed, as historically the lifespan of a slate damp proof course was 75 to 85 years.

41. Mr Butler recommended that a chemical damp proof course be carried out to all internal and external walls of the ground floor and carry out a detailed mould remediation clean.

42. On 4 November 2020 Brian Pender conducted a second inspection to determine the cause of moisture and dampness. Mr Pender’s report dated 5 November concluded that there was moisture/dampness in all rooms due to penetrating damp via the floorboards, specifically ground water entering the sub floor area during rain and/or high humidity. He recommended installing access panels to facilitate more thorough inspections of the sub-floor to determine the cause of the moisture and then further inspections to determine the necessary remedial works. In his opinion, there was no evidence of rising damp or that the damp proof course had failed. Following further inspection, Mr Pender identified potential remedial work as:

1. Install drains at rear and side of building to reduce amount of ground water entering sub floor areas

2. Install membrane to timber floors

3. Open up the sunroom

4. Install weep holes to the outside of house

5. Install mechanical ventilation to sub floor area.

43. In January 2021, Bridge conducted a visual inspection and no mould was identified.

44. Bridge took steps to address the dampness, including installing hatches to the property floor to reduce moisture levels in February 2021.

45. As the damp now appeared to be a structural issue, Bridge concluded that the issue would need to be addressed by the owner, with a request for funding and a full assessment submitted to NSWLH and the process might take some time. Ms Collinge said that the repairs cannot be undertaken whilst the tenant is at the Premises. In an attempt to mitigate risk to the tenant in the meantime, Bridge had attempted to relocate the tenant to 22 different properties, however she has declined them for unsuitability.

46. Should a breach be found, Bridge disputes that the tenant is entitled to a replacement cost of her items affected by mould and a depreciated cost is the appropriate assessment of loss.

47. Bridge further disputes the tenant is entitled to compensation for goods more than 5 years old, which accounts for $5,879.51 of the total replacement cost of $16,818.84.

Findings

Section 63

48. The duty upon the landlord under s 63 of the Act is one of strict liability. Whilst the section requires a regard to the age of, rent payable for and prospective life of the premises, a landlord cannot blame delays by third parties or impecuniosity of the landlord for a failure to act. It is compelled to ensure its obligations are met.

49. However, there can only be a breach of the obligation to maintain premises if the landlord had notice of the need for the repair or ought reasonably to have known of the need for the repair and failed to act with reasonable diligence to have the repair carried out: section 65(3).

50. I accept Bridge’s evidence that it was first notified in August 2017 of mould and shortly thereafter authorised significant cleaning and fogging to remove the mould. At that stage, based on the applicant’s expert’s report, the issue was deemed to be a result of household activity, rather than a structural one.

51. In relation to the resurfacing of mould, I do not accept that the tenant notified Bridge until July 2020. I do not find the tenant’s earlier emails in February and March 2019 to be sufficiently clear to put Bridge on notice of the mould re-emerging.

52. Further, if the tenant, as she attests, first experienced the re-surfacing of mould in mid-2018, then on her evidence, she did not notify Bridge until six to eight months later, during which time the problem would likely have worsened. Further, a property inspection was conducted on 17 December 2018, at which time no mould issues were raised. I do not find it plausible therefore that Bridge was made aware prior to July 2020.

53. I find that once Bridge was notified in July 2020, it took steps to ascertain why the mould had come back. I find that it became aware of the extensive moisture and dampness problem in the period September - November 2020, when it received the reports of Mr Butler of Flood Restoration and Mr Pender. I find that since that time it is responding to address the concerns by conducting further inspections to determine the cause of the dampness. The reports of Mr Pender and Mr Butler in 2020 concluded the issue is more fundamental than Mould Doctor, the applicant’s expert, concluded in 2017, but neither has conclusively determined the cause of the excessive moisture and are in disagreement as to whether the issue is a failure of the damp course and Mr Pender has recommended further investigative work.

54. Whilst there is no evidence of what Bridge (or the owner) has done since November 2020 in terms of actual repairs to address what appears to now be significant structural issues causing damp and moisture, I accept that Bridge has installed hatches in February this year in order to facilitate more thorough inspections of the sub-floor to determine the cause of the moisture, as recommended by Mr Pender and has instigated further inspections.

55. An inspection by Bridge in January this year indicated no mould was present.

56. I accept Ms Collinge’s evidence that any repairs will need to be conducted with vacant possession. To mitigate harm to the tenant, Bridge has attempted to relocate Ms Capponi, however she has refused various properties offered to her.

57. I have taken into account the fact the Premises are very old and the rent is below market and the tenant cannot expect the Premises to be of the same standard as a more expensive or newly built property.

58. For all of these reasons, I do not find that the breach of s 63 has been made out as I am not satisfied that Bridge knew of any potential longstanding penetrating damp and moisture issue prior to September-November 2020 and failed to maintain the Premises accordingly in a proper state of repair.

Section 50

59. I find that the tenant's enjoyment and use of the Premises were adversely affected by the smell and unpleasant appearance of mould throughout.

60. Whilst there is no direct medical evidence from any practitioner that the tenant’s mental or physical health was affected by mould, I accept the tenant’s evidence she has experienced distress and anxiety as set out in her statement and statutory declaration at pages 4 to 12 of her documents.

61. I find that this constitutes a breach of Bridge’s obligations under s 50 of the Act of her right to quiet enjoyment.

Section 44(1)(b)

62. I also find that although the tenant continued to live at the Premises, there has been a withdrawal of services and facilities in terms of the physical state of the Premises as she could not fully use all of the rooms. Indeed, Mr Pender said there was moisture and dampness in all rooms. Ms Capponi has had to endure excessive moisture and mould and unpleasant smells from time to time. Although there is no evidence of the weekly cleaning bills she said she paid, I accept she had to take steps to clean and limit the growth of mould.

Compensable loss

63. Given my finding of a breach of s 50 for loss of enjoyment of the Premises, I now turn to compensable loss that may be awarded.

Economic loss - $9,303.46, being the depreciated value of damaged goods (alternatively $16,818.84, being the replacement value)

64. The tenant has the onus of proving that the amount she claims represents the losses suffered by her.

65. She has presented no receipts to prove the date of purchase and the actual cost of such items. Her statutory declaration attesting to the purchase dates is undated and unsworn. She has however produced evidence in the form of photographs (albeit undated photos) of items damaged by mould.

66. The tenant has said that she threw out some items, but has not provided sufficient evidence of what items needed to be discarded or were in fact thrown out. She has not said whether any items are still usable, if for instance, the mould could be wiped off any items. It is unclear if she received any money from an insurance claim she mentioned to the professional cleaners.

67. Further, I do not accept Ms Capponi should be entitled to the current value of items ($16,818.84), given some are nine years old. A depreciated cost is the appropriate assessment of loss, which the tenant says is $9,303.46.

68. Doing the best I can on the available evidence, I estimate the value of the damaged items to be 50% of the depreciated amount claimed, which is $4,651.73.

Compensation for discomfort and loss of enjoyment of property - $2,000

69. The tenant claims loss under this head for distress, anxiety and disappointment as a result of the breach of quiet enjoyment.

70. I accept that this loss is recoverable as the RTA is contract for enjoyment pleasure and relaxation and therefore falls under the exception to the general rule that damages for distress and disappointment are not recoverable: Baltic Shipping Co v Dillon [1993] HCA 4.

69. I also accept that distress, disappointment and anxiety do not constitute a personal injury for the purposes of the Civil Liability Act 2002 (NSW) (CLA) and s 16 of the CLA does not apply: Moore v Scenic Tours Pty Ltd [2002] HCA 17.

70. However I have taken into account the fact Bridge has offered the tenant countless alternative accommodation, which have been refused.

71. I allow $1,000 for this head of loss.

Rent reduction - $3,422

74. The tenant seeks a 30% rent reduction, being $65.60 per week for 12 months from 28 October 2019 to 28 October 2020. Given I have found Bridge was not on notice of the mould re-emerging until 9 July 2020, I will allow a 30% rent reduction of the weekly rent of $218.66 for 15 weeks from 9 July 2020 to 28 October 2020, which totals $984.

Section 65

75. Whilst acknowledging she may be relocated, during the hearing the tenant confirmed that she pressed the repair orders she had sought in her application, although her advocate said she may not enforce any work orders made and it was a matter for the respondent as to what work was done. Given I have found no breach of s 63, I make no orders under s 65.

Quantum - summary

76. It follows that the tenant is entitled to:

1. Compensation for economic loss - $4,651.73

2. Compensation for distress and anxiety - $1,000

3. Rent reduction - $984.00

Total: $6,635.73

Orders

77. It follows that the appropriate order is:

1. The respondent is to pay the applicant the sum of $6,635.73 within 28 days

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I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales.

Registrar

Decision last updated: 04 August 2021