Commonwealth of Australia (As Represented BY the Department of Infrastructure and Regional Development) v Kenney
[2015] FCCA 3400
•21 December 2015
FEDERAL CIRCUIT COURT OF AUSTRALIA
| COMMONWEALTH OF AUSTRALIA (AS REPRESENTED BY THE DEPARTMENT OF INFRASTRUCTURE AND REGIONAL DEVELOPMENT) v KENNEY & ANOR | [2015] FCCA 3400 |
| Catchwords: PRACTICE & PROCEDURE – Whether proceedings were properly constituted. |
| Legislation: Federal Circuit Court of Australia Act 1999 (Cth) s.10AA |
| Commonwealth of Australia (As Represented By The Department of Infrastructure and Regional Development) v Odzic & Anor [2015] FCCA 3363 Commonwealth of Australia (As Represented By The Department of Infrastructure and Regional Development) v Rigney & Anor (No.3) [2015] FCCA 3133 |
| Applicant: | COMMONWEALTH OF AUSTRALIA (AS REPRESENTED BY THE DEPARTMENT OF INFRASTRUCTURE AND REGIONAL DEVELOPMENT) |
| First Respondent: | PATRICK KENNEY |
| Second Respondent: | LEONA PAGE |
| File Number: | SYG 1798 of 2015 |
| Judgment of: | Judge Smith |
| Hearing dates: | 18 & 19 November 2015 |
| Date of Last Submission: | 14 December 2015 |
| Delivered at: | Sydney |
| Delivered on: | 21 December 2015 |
REPRESENTATION
| Counsel for the Applicant: | Mr J. Doyle, Mr D.W. Rayment & Ms A. Mitchelmore |
| Solicitors for the Applicant: | Australian Government Solicitor |
| Counsel for the First Respondent: | Mr P. King |
ORDERS
The residential tenancy agreement in relation to the premises at 30 (formerly Lot 11) Longleys Road, Badgerys Creek NSW 2555 (“Premises”) be terminated with immediate effect.
Vacant possession of the premises be given to the Applicant on or before 28 December 2015.
The order for vacant possession be suspended until 25 January 2016.
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT SYDNEY |
SYG 1798 of 2015
| COMMONWEALTH OF AUSTRALIA (AS REPRESENTED BY THE DEPARTMENT OF INFRASTRUCTURE AND REGIONAL DEVELOPMENT) |
Applicant
And
| PATRICK KENNEY |
First Respondent
| LEONA PAGE |
Second Respondent
REASONS FOR JUDGMENT
The Commonwealth is the registered proprietor of the land situated at 30 (formerly Lot 11) Longleys Road, Badgerys Creek NSW 2555 (“Premises”). The Premises are part of a larger area which the Commonwealth proposes to develop for the purposes of an airport.
The respondents moved into the Premises in February 1999 and, on 1 March 2004, entered into a residential tenancy agreement (“Agreement”) with the Commonwealth in respect of the Premises. The second respondent, Ms Page, moved out some time in 2007 and has taken no part in these proceedings. Mr Kenney now lives on the Premises with Catherine Brabin.
The Commonwealth gave a notice of termination in respect of the Premises on 29 November 2014 specifying 15 June 2015 as both the date of termination and the day on which vacant possession of the Premises was to be given. The first respondent did not vacate the Premises by that date and the Commonwealth now seeks orders terminating the Agreement and for vacant possession.
Mr Kenney opposes the orders sought by the Commonwealth on a number of bases. The first is that no notice of termination was served on Ms Brabin. The second is that the law relied upon by the Commonwealth for the determination of the dispute between the parties does not apply because the Premises are predominantly used for non-residential purposes. Thirdly, the Court does not have jurisdiction to make the orders because the legislation purporting to grant the Court jurisdiction is unconstitutional. Fourthly, the determination of the law to be applied by the Court was beyond the power granted by the relevant statute. Fifthly, the Court should refuse to exercise its jurisdiction to terminate the agreement as a matter of discretion.
The first of these contentions can be dealt with briefly. Ms Brabin gave evidence that she has, to the knowledge of the Commonwealth, occupied the Premises with Mr Kenney since 2010. That may well be, however, it does not make her a tenant or co-tenant within the meaning of the Residential Tenancies Act 2010 (NSW) (“Tenancies Act”). She has no “right to occupy residential premises under a residential tenancy agreement”, is not a person “to whom such right passes by transfer or operation of the law”, and is not a sub-tenant of either Mr Kenney or Ms Page: see Tenancies Act s.3. In light of that, there was no requirement to “give” Ms Brabin any notice of termination. In any event, a document may be “given” to a person by delivering it personally to a person apparently of or above the age of 16 years at the person’s residential address: Tenancies Act sub-s.223(1)(a)(ii). That was done in this case. Ms Brabin gave evidence that she was aware of the notice of termination and so it cannot be argued, as it has, that notice was not “given”.
In his response, Mr Kenney also raised a number of other points that can be dealt with briefly:
a)He makes three pleading points:
i)the applicant has failed to allege properly or at all and/or to particularise any right to possession of the lands the subject of the claim, and has failed to allege any lease, the relevant terms thereof, or the service of any notice to quit upon the respondent according to law;
ii)the applicant has failed to allege what right if any it has under the Tenancies Act or to make a claim reliant on the terms of the said Act; and
iii)he says that it was an express term of the residential lease between the parties that the tenancy ends by expiry of a properly given notice of termination serve by the Commonwealth or by an order of the Residential Tenancies Tribunal [sic] neither of which was alleged by the applicant nor has occurred.
The answer to all of these is that the application is not a pleading and the availability of the relief sought in the application must be dealt with on the basis of the evidence in the proceedings.
b)He contests that letters sent to him by the Commonwealth’s property agents were lawful and effective notices of termination. The Commonwealth only relies on one notice. It is dealt with below.
There have been a number of proceedings brought by the Commonwealth against tenants and other occupiers of land in the vicinity of the Premises. The majority of those proceedings have fallen into two groups by reference to the length of time during which the tenants had been in possession of the land, namely, those who had been in possession for 20 years or more and those who had been in possession of the land for less than 20 years. Judgment has already been handed down in all of the first group of cases: see, for example, Commonwealth of Australia (As Represented By The Department of Infrastructure and Regional Development) v Rigney & Anor (No.3) [2015] FCCA 3133 (“Rigney”). These proceedings belong to the second group most of the proceedings in which were heard concurrently. Judgment in each of the matters heard concurrently has been handed down at the same time as judgment in this matter.
In one of the matters handed down at the same time as this judgment, I explained in some detail the relevant statutory scheme: see Commonwealth of Australia (As Represented By The Department of Infrastructure and Regional Development) v Odzic & Anor [2015] FCCA 3363 (“Odzic”) at [7] – [19]. There is no need to repeat that explanation here. The judgment in that matter ought to be read together with my reasons in this matter.
In spite of the differences between the two groups of proceedings, similar issues arose in both groups. For example, similar challenges were made in both groups of proceedings to the jurisdiction of this Court. Those challenges were dealt with extensively in the reasons for judgment in Rigney. For that reason, these reasons ought to be read together with my reasons in that matter.
Before turning to the jurisdictional issues, it is necessary to deal with a number of factual issues.
Questions of fact relevant to the jurisdictional issues
I find the following facts, noting that, to the extent that any of them are controversial, my reasons for making the finding are set out further below:
a)the Commonwealth is the registered proprietor of the land comprised in folio identifier 1/838361 (“airport site”);
b)the Premises form part of the airport site;
c)Mr Kenney has occupied the Premises since 1999;
d)on 1 March 2004 the parties entered into a residential tenancy agreement in respect of the Premises;
e)the term of the Agreement was 52 weeks from 1 March 2004 and expired on 21 February 2005 (which is in fact only 51 weeks but the term has expired on any view);
f)the respondents have been in continual possession of the Premises for less than 20 years;
g)Ms Page occupied the Premises from 1999 until 2007 and no longer resides there;
h)the Premises are not predominantly used for non-residential purposes;
i)by letter dated 29 October 2014 the Commonwealth notified Mr Kenney that it will likely require him to vacate the Premises by June 2015;
j)on 29 November 2014, the Commonwealth served a notice of termination of the Agreement on Mr Kenney;
k)the notice of termination stipulated 15 June 2015 as the day on which the Agreement terminated and by which Mr Kenney was required to give vacant possession of the Premises to the Commonwealth; and
l)Mr Kenney has not indicated that he was willing to vacate the Premises by that date and has remained in possession of the Premises.
The finding at [11](h) above deals with Mr Kenney’s second contention set out at [4] above. The relevance of that contention was explained in my judgment in Rigney at [8]-[23]. Briefly, the argument is as follows: first, the Tenancies Act does not apply to land that is predominantly used for agricultural purposes: s.7(h); secondly, the land which is the subject of these proceedings is predominantly used for agricultural purposes; thirdly, in the premises, the Court does not have jurisdiction in respect of the land.
The conclusion does not follow from the premises. As I explained in Rigney at [16], the only consequence of any conclusion that land is not governed by the Tenancies Act is that the Court must apply the common law to the dispute between the parties. In any event, the issue can be decided by reference to the second premise, namely the predominant use of the Premises.
Ms Brabin’s evidence in this respect was that she and Mr Kenney “run horses in the four paddocks” which they sell and trade. She says that they make an income from those activities. She says that they “assist in looking after the farm during the week”.
I accept that rearing horses for sale or trade might constitute an agricultural or business activity. However, in the absence of any details of the size or scale of that activity I cannot be satisfied that the use of the Premises is predominantly for that purpose. By contrast, as the Agreement makes clear, the Premises are constantly used by Mr Kenney as his home and, according to Ms Brabin, her home as well. For those reasons, I conclude that the Premises are not predominantly used for agricultural or business purposes. Accordingly, subject to the remaining jurisdictional arguments, the law to be applied in resolution of these proceedings is the Tenancies Act.
Jurisdictional issues
The arguments raised in this case were the same as those argued in Odzic and are rejected for the reasons I gave there are at [40] – [44].
Consideration of substantive issues
In light of the statutory scheme outlined in Odzic, the first step in the resolution of these proceedings is to determine whether the duty to make a termination order arises. In essence, that requires consideration of whether a notice of termination has been given in terms required by the Tenancies Act and whether the respondents have vacated the property as required by the notice. The second step is to determine what the appropriate date is for vacant possession to be given. This involves some balancing of the parties’ interests. Part of this consideration could also involve the application of s.114 of the Tenancies Act to suspend the date of the order for vacant possession.
It is necessary, then, to turn to each relevant consideration.
Notice of termination
The term of the Agreement was 52 weeks from 1 March 2004 and it expired on 21 February 2005. As I have already noted, the period 1 March 2004 to 21 February 2005 is less than 52 weeks, but the term has expired on any view of the evidence.
Another term of the Agreement was that at the end of that term the tenant could stay in the residential premises at the same or increased rent but otherwise under the same terms unless or until the agreement was ended in accordance with the Residential Tenancies Act 1987 (NSW). In other words, at the end of the term, the agreement continued as it had before but without any fixed term.
For that reason, it was a “periodic agreement” within the meaning of the Tenancies Act at least from the commencement of the Tenancies Act in January 2011: s.3. Further, the effect of s.18 of the Tenancies Act is that a fixed term agreement that continues after the day on which the fixed term ends, continues to apply as if the term of the agreement were replaced by periodic agreement.
As the respondents had not been in continual possession of the property for 20 years or more, s.85 of the Tenancies Act applied to the termination of the agreement by the Commonwealth.
A termination notice under the Tenancies Act must set out the following matters: first, the residential premises concerned; secondly, the day on which the residential tenancy agreement is terminated by which vacant possession of the premises is to be given; thirdly, if the notice is not given under ss.84, 85, 96 or 97, the ground for the notice; and fourthly, any other matters prescribed by the regulations, in this case the Residential Tenancy Regulations 2010 (NSW). The termination notice must be in writing and be signed by the party giving the notice or the party’s agent and a termination notice for a periodic agreement may specify a day other than the last day of the period for the payment of rent as the termination date: s.82.
The notice of termination in this case was dated 24 November 2014 and given by delivering personally to a person apparently over the age of 16 years at the Premises on 29 November 2014. It correctly identified the property, set out the day on which the agreement was to be terminated (15 June 2015) and the date on which vacant possession of the premises was to be given, being the same date as the date of termination. It was in writing and signed by an agent for the Commonwealth. There were no relevant regulations.
In those circumstances I am satisfied that a notice of termination was given in accordance with the requirements of the Tenancies Act.
Have the respondents vacated the premises as required by the notice?
While Ms Page vacated the Premises some years ago, Ms Brabin’s evidence establishes that Mr Kenney is still living there.
For those reasons, the matters in sub-s.85(3) of the Tenancies Act have been established and the residential tenancies agreement between the parties must be terminated.
The appropriate date on which vacant possession is to be given to the landlord
In considering this issue, it is convenient to deal first with the Commonwealth’s case before turning to the individual circumstances of Mr Kenney.
The evidence in this matter concerning the circumstances relied on by the Commonwealth was the same as in each of the matters heard concurrently. I set out the effect of that evidence and my findings in Odzic at [59] – [81]. They form part of my reasons in this case but need only be summarised here as follows:
a)the development of a further airport in Sydney is of the general importance for both the economic and social wellbeing of Western Sydney, if not this country;
b)significant time, effort and money has already been put into preparation of the site for the future development of the airport and the continued presence of tenants on the airport site is to increase the amount of costs likely to be incurred by the Commonwealth in that development;
c)the safety of individual tenants will decrease as more and more tenants vacate the site; and
d)Mr Kenney has been on notice since at least the beginning of the current residential tenancy agreement of the possibility of the use of the land in Badgerys Creek as an airport and the consequent need for them to give vacant possession to the Commonwealth for that purpose. That awareness was heightened by correspondence in October 2014 from the agents for the Commonwealth and put beyond doubt by the notice of termination served in November 2014.
Apart from the matters I have already dealt with, Mr Kenney relies on a number of matters in support of the argument that the Court should refuse the Commonwealth’s argument.
First, he argues that the power to make a termination order under s.85 is discretionary. That argument is rejected for the reasons I gave in Odzic at [82] – [84]. For that reason, I have considered Mr Kenney’s remaining arguments (as outlined below) on the basis that they might inform the question of the appropriate date by which vacant possession of the Premises ought to be given to the Commonwealth:
a)The proposed termination and/or eviction will cause hardship to the Respondents
There is no evidence of any hardship beyond the ordinary inconvenience of moving house.
b)The cost of removing buildings and equipment to myself is substantial
There is no evidence to support this claim.
c)The cost of moving from Badgerys Creek gives rise to further costs and expenses per annum
There is no evidence to support this claim.
d)Having regard to the length of occupation of the lands in question and the property of the Respondents the period for vacating the lands is insufficient and unduly short
Mr Kenney has been on notice of the need to vacate for over a year. There is nothing beyond mere assertion to suggest that that is inadequate time to prepare to vacate.
e)There is no urgency for the applicant to evict the Respondent because the applicant within the last 10 years has given a 99 year right of refusal to open or use Badgerys Creek as a commercial airport in the Sydney Metropolitan region to Macquarie Airports the lessee and user of Kingsford Smith Airport a commercial airport within the Sydney Metropolitan region, and Macquarie Airports has no commercial use nor requirement nor interest nor plan to operate or use Badgerys Creek as an airport at any time in the foreseeable future including the next 30 years
Mr Kenney also raised a similar claim, namely, that there was no pending commercial requirement for the orders for termination for over 12 years. I dealt with and rejected the same arguments in Odzic at [95] – [101]. In brief, the evidence does not support the claim.
f)There is no suitable or available alternative similar leaseholds in the region of Badgerys Creek or Luddenham for the Respondents to rent or occupy on the same or similar terms;
Neither Mr Kenney nor Ms Brabin gave evidence of any attempts to locate alternative suitable accommodation.
Mr Kenney tendered a folder of material (exhibit E) that included some documents relevant to the availability of accommodation in the Greater Western Sydney region. The first of those documents related to community housing. There was no evidence about Mr Kenney’s financial circumstances other than that he sold and traded horses as well as driving a paper truck. For that reason, the availability of community housing is not relevant to their circumstances. The second group of documents consists of advertisements for rental accommodation that seem to have been downloaded from an online real estate website. However, they do not establish anything relevant other than that, at certain dates the properties shown in the advertisements were available for rent for particular amounts. There is no evidence that these were the only properties available, or what properties were available at other times or in other locations. None of this material carries any weight.
g)The applicant has offered to the Respondent no compensation for the loss of the Respondents property affixed to the land or otherwise and for the cost of complying with the eviction notices.
No basis was given in evidence or submissions for any right to compensation and, in any event, it is difficult to understand how such a right might affect the determination of an appropriate date by which vacant possession of the Premises must be given. That is particularly so in the absence of any evidence about Mr Kenney’s financial means.
h)As there was an express provision in the Agreement in relation to termination, the rights of the parties are governed by that clause
I dealt with and rejected this and a similar argument in Odzic at [106] – [109]. The argument is rejected in these proceedings for the same reasons. In doing so, I note that the express provision in the Agreement was sufficiently similar to the one referred to in Odzic.
i)Because the termination notice was served before the introduction of s.10AA into the FCCA, it was not effective for the purposes of the Commonwealth law
I dealt with and rejected this argument in Odzic at [110] – [111]. The argument is rejected in these proceedings for the same reasons.
In my view, Mr Kenney has presented no real basis for his opposition to the orders sought by the Commonwealth.
Conclusion
In light of the circumstances relied on by the Commonwealth as summarised above and the fact that Mr Kenney has put forward nothing of any substance in opposition to the orders sought, I am satisfied that the appropriate date on which Mr Kenney is to give vacant possession of the Premises is 28 December 2015 but that the order for vacant possession should be suspended until 25 January 2016. In fixing that date, I have taken into account the time of year even though that was not addressed by either of the parties.
The Commonwealth sought orders for the issue of warrants for possession. In my view, the basis on which it sought those orders was unclear. The Tenancies Act makes provision for the issue of warrants (s.121) and, if it is necessary to do so, there is nothing preventing the Commonwealth from making use of those provisions.
For those reasons, I make the following orders:
a)The residential tenancy agreement in relation to the premises at 30 (formerly Lot 11) Longleys Road, Badgerys Creek NSW 2555 (“Premises”) be terminated with immediate effect.
b)Vacant possession of the premises be given to the Applicant on or before 28 December 2015.
c)The order for vacant possession be suspended until 25 January 2016.
I certify that the preceding thirty-five (35) paragraphs are a true copy of the reasons for judgment of Judge Smith
Associate:
Date: 21 December 2015
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