Commonwealth of Australia v Foster
[2015] FCCA 2663
•2 October 2015
FEDERAL CIRCUIT COURT OF AUSTRALIA
| COMMONWEALTH OF AUSTRALIA v FOSTER | [2015] FCCA 2663 |
| Catchwords: ADMINISTRATIVE LAW – Commonwealth tenancy dispute – termination of a periodic tenancy agreement under s.85 Residential Tenancies Act 2010 (NSW) – respondent in possession of the premises for less than 20 years – whether termination of the tenancy agreement is granted – original tenancy agreement expired – respondent notified of termination – termination of tenancy agreement granted – order for vacant possession suspended. |
| Legislation: Airports Act 1996 (Cth) |
| Celemajer Holdings Pty Ltd v Kopas [2011] NSWSC 40 Articles and other material cited: | ||
| Applicant: | COMMONWEALTH OF AUSTRALIA (AS REPRESENTED BY THE DEPARTMENT OF INFRASTRUCTURE AND REGIONAL DEVELOPMENT) | |
| Respondent: | ALLAN FOSTER |
| File Number: | SYG 1946 of 2015 |
| Judgment of: | Judge Smith |
| Hearing date: | 14 September 2015 |
| Date of Last Submission: | 18 September 2015 |
| Delivered at: | Sydney |
| Delivered on: | 2 October 2015 |
REPRESENTATION
| Counsel for the Applicant: | Mr. D.W. Rayment |
| Solicitors for the Applicant: | Australian Government Solicitor |
| The Respondent appeared in person |
ORDERS
The residential tenancy agreement in relation to the premises at 60-70 (formerly Lot 65) Leggo Street, Badgerys Creek NSW 2555 be terminated with effect from 2 October 2015.
Vacant possession of the premises be given to the Applicant on or before 16 October 2015.
The order for vacant possession be suspended to 15 January 2016.
There be no order as to costs in relation to the proceedings.
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT SYDNEY |
SYG 1946 of 2015
| COMMONWEALTH OF AUSTRALIA (AS REPRESENTED BY THE DEPARTMENT OF INFRASTRUCTURE AND REGIONAL DEVELOPMENT) |
Applicant
And
| ALLAN FOSTER |
Respondent
REASONS FOR JUDGMENT
Introduction
Allan Foster has been in occupation of the property at 60-70 (formerly Lot 65) Leggo Street, Badgerys Creek, New South Wales (“the Premises”) since October 2001. Badgerys Creek is part of the semi-rural western edge of the greater metropolitan area of Sydney. The Premises is owned by the Commonwealth of Australia and is part of a site which is proposed to be developed as a new airport. In order to proceed with the development of the site, the Commonwealth served on Mr Foster a notice of termination of the residential tenancy agreement nominating 15 June 2015 as the date of termination and by which vacant possession was required to be given to the Commonwealth. When Mr Foster did not vacate the property by that date, the Commonwealth commenced these proceedings seeking orders terminating the residential tenancy agreement and for vacant possession of the property.
Although Mr Foster had not filed any response or any evidence in the proceedings, he appeared at the hearing of the matter and his wife spoke on his behalf. The parties presented and later tendered an agreed statement of facts, part of which relate to the circumstances relied on by Mr and Mrs Foster in support of their desire to remain on the property until 15 January 2016.
Given that Mr Foster has been in possession of the property for less than 20 years, the Court must make a termination order if it is satisfied that a termination notice was given in accordance with s.85 of the Residential Tenancies Act 2010 (NSW) (“Tenancies Act”) and the tenant has not vacated the premises as required by the notice. In making such an order it must make an order for vacant possession and specify the date upon which the order is to take effect.
An order for possession may be suspended if the Court considers that it is desirable to do so having regard to the relative hardship likely to be caused to the parties by the suspension: Tenancies Act, s.114.
I accept that a proper notice of termination has been served and the residential tenancy agreement must be terminated.
The Commonwealth says that it needs occupation of the land in order to proceed with the proposal to develop the whole site as an airport. I accept that the proposal is considered to be in the national interest and that the Commonwealth has a genuine need for possession in order to pursue that interest.
However, the personal circumstances of Mr Foster are such that it is desirable that an order for immediate possession ought to be suspended until 15 January 2016.
The relevant statutory framework
As I explained in Commonwealth of Australia (As Represented By Department of Infrastructure and Regional Development) v Hevers [2015] FCCA 1814 (“Hevers”), this Court has jurisdiction pursuant to s.10AA of the Federal Circuit Court of Australia Act 1999 (Cth) (“FCCA Act”) in relation to Commonwealth tenancy disputes in which the Commonwealth is the lessor and a person other than the Commonwealth is the lessee. In exercising that jurisdiction in respect of land in New South Wales, the Court is to apply the Tenancies Act subject to some modifications and to the extent necessary to determine the dispute: Federal Circuit Court (Commonwealth Tenancy Disputes) Instrument 2015 (Cth) (“Tenancy Disputes Instrument”), s.7.
A Commonwealth tenancy dispute includes a matter involving a lease, licence or other arrangement to possess, occupy or use land and a dispute about the termination of the lease, licence or other arrangement in which the Commonwealth is a party: FCCA Act s.5.
There is no question that these proceedings involve a Commonwealth tenancy dispute. In order to understand the law that is to be applied in determining the dispute, it is necessary to have regard to the relevant provisions of the Tenancies Act and briefly consider some of the historical context of that Act.
Tenancies Act
The following summary of the Tenancies Act is largely taken from the judgment in Hevers.
The Tenancies Act relevantly commenced operation on 31 January 2011 and applies to residential tenancy agreements in respect of residential premises made before or after that date: s.6. “Residential premises” is defined to include any premises or part of premises (including any land occupied with the premises) used or intended to be used as a residence: s.3.
A residential tenancy agreement is an agreement under which a person grants to another person, for value, a right of occupation of residential premises for the purposes of use as a residence: s.13. An agreement may be a residential tenancy agreement for the purposes of the Tenancies Act even if the agreement does not grant a right of exclusive occupation or grant the right to occupy residential premises together with the letting of goods or the provision of services or facilities: s.13(3).
A residential tenancy agreement that is for a fixed term continues to apply after that term ends as if the term of the agreement were replaced by a periodic agreement and on the same terms as immediately before the end of the fixed term: s.18.
The critical provisions of the Tenancies Act are found in pt.5 and concern the termination of residential tenancy agreements. Importantly, s.81(1) provides that a residential tenancy agreement terminates only in the circumstances set out in the Tenancies Act. Division 2 of pt.5 (ss.84-95) makes provision for termination by the landlord. Section 84 provides:
84End of residential tenancy agreement at end of fixed term tenancy
(1)A landlord may, at any time before the end of the fixed term of a fixed term agreement, give a termination notice for the agreement that is to take effect on or after the end of the fixed term.
(2)The termination notice must specify a termination date that is on or after the end of the fixed term and not earlier than 30 days after the day on which the notice is given.
(3)The Tribunal must, on application by a landlord, make a termination order if it is satisfied that a termination notice was given in accordance with this section and the tenant has not vacated the premises as required by the notice.
(4)This section does not apply to a residential tenancy agreement if the tenant has been in continual possession of the same residential premises for a period of 20 years or more and the fixed term of the original fixed term agreement has ended.
Section 85 deals with the termination of periodic agreements and provides:
85Termination of periodic agreement
(1)A landlord may, at any time, give a termination notice for a periodic agreement.
(2)The termination notice must specify a termination date that is not earlier than 90 days after the day on which the notice is given.
(3)The Tribunal must, on application by a landlord, make a termination order if it is satisfied that a termination notice was given in accordance with this section and the tenant has not vacated the premises as required by the notice.
(4)This section does not apply to a residential tenancy agreement if the tenant has been in continual possession of the same residential premises for a period of 20 years or more.
The Tribunal means the New South Wales Civil and Administrative Tribunal (“NCAT”): s.3.
Section 83 of the Tenancies Act provides that, if the Tribunal makes an order terminating a residential tenancy agreement under the Act, it must also make an order for possession of the residential premises, specifying the day on which the order takes or took effect.
Recovery of possession of premises is dealt with in pt.6 of the Tenancies Act (ss.119-135). Section 119 provides that a landlord or former landlord must not commence proceedings against a tenant or former tenant of the landlord in the Supreme Court, the District Court or the Local Court to obtain recovery of possession of residential premises subject to a residential tenancy agreement. The effect of this provision is adumbrated above, namely, that the NCAT has exclusive jurisdiction in New South Wales in respect of the recovery of possession of residential premises subject to a residential tenancy agreement.
Part 9 of the Tenancies Act (ss.187-195) provides for the powers of the NCAT. Amongst the powers provided for in that Part, the NCAT may make an order that restrains any action in breach of a residential tenancy agreement or an order that requires an action in performance of a residential tenancy agreement: subs-ss.187(1)(a) and (b). An order under either of those subsections may be made even though it provides a remedy in the nature of an injunction or order for specific performance in circumstances in which such a remedy would not otherwise be available: s.187(3).
Tenancy Disputes Instrument
Sections 7 and 8 of the Tenancy Disputes Instrument are also important to the determination of the issues in these proceedings. They provide:
7 Law to be applied
(1)In determining a Commonwealth tenancy dispute involving land in New South Wales, the Residential Tenancies Act 2010 (NSW) and any regulations made under that Act are to be applied:
(a)to the extent necessary to determine the dispute; and
(b)subject to the modifications set out in section 8 of this instrument.
(2)The law mentioned in subsection (1) is the applicable NSW law.
8 Modifications of applicable NSW Law
(1)The applicable NSW law is to be applied as if:
(a)a reference to the Tribunal were a reference to the Federal Circuit Court of Australia; and
(b)a reference to the principal registrar of the Tribunal were a reference to a Registrar of the Federal Circuit Court of Australia; and
(c)a reference to the Sheriff, or to a sheriff’s office, were a reference to the Sheriff of the Federal Circuit Court of Australia.
(2)The Residential Tenancies Act 2010 (NSW) is to be applied as if it included the following section:
Despite anything else in this Act, if the Federal Circuit Court of Australia makes a termination order in respect of residential premises, the Court may make such orders as it considers appropriate in relation to the day vacant possession of the premises is to be given to the landlord.
Section 9 of the Tenancy Disputes Instrument is also pertinent to the issues in the proceedings. It provides:
9 Powers of the Court
In determining a Commonwealth tenancy dispute involving land in New South Wales, the Federal Circuit Court of Australia may exercise any powers that are:
(a)powers of the Civil and Administrative Tribunal under the applicable NSW law; and
(b) relevant to determining the dispute.
In very broad overview, the relevant effect of s.10AA of the FCCA Act and the Tenancy Disputes Instrument is that this Court has jurisdiction to determine an application by the Commonwealth, as landlord, for an order for termination (which includes an order for vacant possession).
History of termination in NSW tenancy law
The termination provision in the predecessor to the Tenancies Act was in slightly different terms to s.85. The provision providing for termination by a landlord was s.64 of the Residential Tenancies Act 1987 (NSW) (“1987 Act”). The relevant part of that provision was:
64Application to Tribunal by landlord for termination and order for possession
(1) If:
(a)a landlord or a tenant gives notice of termination of a residential tenancy agreement under this Part, and
(b)the tenant fails to deliver up vacant possession of the residential premises on the day specified,
the landlord may, not later than 30 days after that day, apply to the Tribunal for an order terminating the agreement and an order for possession of the premises.
(2)The Tribunal, on application by a landlord under this section, is to make an order terminating the agreement if it is satisfied:
(a)in the case of a notice given by a landlord on a ground referred to in section 56 or 61 - that the landlord has established the ground, or
(b)in the case of a notice given by a landlord on the ground referred to in section 57, relating to a breach of the agreement:
(i) that the landlord has established the ground, and
(ii) that the breach, in the circumstances of the case, is such as to justify termination of the agreement, or
(c)in any other case (except in the case of a notice given by a landlord on a ground referred to in section 63B, 63F or 63I):
(i) that the tenant has seriously or persistently breached the agreement, or
(ii) that, having considered the circumstances of the case, it is appropriate to do so.
(Emphasis added)
In Swain v Residential Tenancies Tribunal of New South Wales (Supreme Court of New South Wales, Rolfe J, unreported, 22 March 1995) it was argued that a landlord had the right to obtain a termination order under s.64 upon giving the requisite notice at the end of the term of a lease. Rolfe J rejected this argument, holding that the Tribunal must also be satisfied of the matters in sub-s.64(2)(c)(ii), namely, that it was appropriate to terminate the lease having considered the circumstances of the case. As to those circumstances, his Honour said:
… Possible “circumstances”, which may have to be taken into account, are the time the tenant has occupied the premises, the age and state of health of the tenant, the necessity for any number of reasons for the tenant to live in a particular area, and the inability of the tenant to obtain other suitable accommodation in which, of course, I include accommodation in an area suitable for matters such as proximity to family, facilities or employment. …
That decision was upheld on appeal: Roads and Traffic Authority v Swain (1997) 41 NSWLR 452. There, Meagher AJ, with whom Priestley and Cole JJA agreed, held at 456B, that the “circumstances” referred to in s.64 were the particular case before the Tribunal. His Honour also explained that the Act was intended to balance the rights of the landlords and tenants. See also Celermajer Holdings Pty Ltd v Kopas [2011] NSWSC 40 at [447].
In Scicluna v New South Wales Land and Housing Corporation (2008) 72 NSWLR 674 the New South Wales Court of Appeal considered, amongst other things, the nature of the power of the Tribunal under s.64(2). The Court found that the power conferred on the Tribunal was to make an order terminating a residential tenancy agreement if it were satisfied as to the statutory criteria; it was not a discretionary power but a matter of statutory obligation, once an evaluative opinion had been formed: 676 [1] per Hodgson JA, 677 [6] per Basten JA, 690 [63] per Campbell JA. See also Sydney Harbour Federation Trust v McCluskey [2012] NSWSC 253 at [19].
That conclusion was clearly correct in light of the terms of the chapeau that provides that the Tribunal “is to make an order terminating the agreement if it is satisfied …”. The evaluative opinion referred to in the decision arises from the condition of the power that the Tribunal be satisfied, “having considered the circumstances of the case, it is appropriate to do so.”
A very brief history of the development of the common law of landlord and tenant is set out by Adrian (now Professor) Bradbrook in The New Era of Tenancy Protection (1987) 61 ALJ 593. He explains that, after the adoption of the English law by the Australian states there were very few statutory amendments or case law developments to that law. Amongst the few statutory amendments was the Landlord and Tenant Act 1899 (NSW) that contained very few provisions and could not be described as a comprehensive scheme of protection for tenants.[1] Bradbrook opined that the failure of the law in Australia to provide for such a scheme was that the tenant in 16th Century England required no such protection and that the problem with the common law approach of freedom of contract was not its inherent bias towards landlords, but its failure to keep pace with the times by recognising societal changes.[2]
[1] (1987) 61 ALJ 593 at 594.
[2] Ibid.
These societal changes were addressed to some extent in the First World War and subsequent legislation for the control of rents such as the Fair Rents Act 1915 (NSW) and the Reduction of Rents Act 1931 (NSW), the vestiges of which remain today in New South Wales in the Landlord and Tenant (Amendment) Act 1948 (NSW).
The reasons for the need for more comprehensive reform are explained by Bradbrook in both The New Era of Tenancy Protection (1987) 61 ALJ 593 and an earlier article, The Role of the Judiciary in Reforming Landlord and Tenant Law (1976) 10 MULR 459. Amongst those were the conclusion of the Commonwealth Commission of Inquiry into Poverty in 1974, the most important of which was the basic inequality of bargaining power between landlord and tenant.
The first attempt in New South Wales at comprehensive reform of the law of landlord and tenant (at least insofar as it relates to residential tenancies) was the 1987 Act. The Tenancies Act represents a further step in the same direction. The second reading speech made on the introduction of the bill elaborates on the need for the further reform. The Hon. Penny Sharpe (Parliamentary Secretary) said:
The structure and composition of the residential rental market in New South Wales has significantly changed since the current laws were developed more than 20 years ago. Families and older people are now a much bigger part of the rental market. Shared households are becoming increasingly common and many tenants now rent for their entire lives, compared to the past when renting was often seen as just a stepping stone into home ownership.
…
The changing rental market means that it is becoming increasingly important to make sure our tenancy laws are up to date, that they are unambiguous, and that they are responsive to the needs of the community. We need a regulatory regime that reduces unnecessary costs, promotes equity and supports the future provision of rental housing in New South Wales.
One of the concerns addressed in the second reading speech was that, under the 1987 Act, the Tribunal had to consider the circumstances of the case before making a termination order. The Hon. Penny Sharpe described the removal of that “discretion” as a “major win for landlords”.
In any event, the concerns discussed in the second reading speech were an evolution of those concerns that led to the first comprehensive reforms under the 1987 Act. Essentially, the continued reforms are aimed at achieving a balance between the interests of the landlord and the tenant. In the case of tenants who have been in possession of the property for less than 20 years, the balance has shifted back to the landlord. However, the date of vacant possession is still a matter for the Tribunal or Court’s discretion. Section 8(2) of the Tenancy Disputes Instrument amends the Tenancies Act so that the date for possession is the date that the Court considers appropriate.
Consideration
The first step of the approach to this case must then be 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 Mr Foster has 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 a 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 Premises is part of the land comprised in certificate of title folio identifier 1/838361 of which the Commonwealth is the registered proprietor. Mr Foster came into possession of the Premises in October 2001. On 1 March 2004 he entered into a residential tenancy agreement in respect of the Premises with the Commonwealth. That agreement described improvements to the property as being a three-bedroom home with one corrugated iron shed. The term was for 52 weeks beginning on 1 March 2004 and ending on 28 February 2005.
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 1987 Act. 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. For that reason, the agreement between Mr Foster and the Commonwealth was a periodic agreement from 1 March 2005.
As Mr Foster 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 must 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 served on the applicant at his home on 26 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.
Has Mr Foster vacated the premises as required by the notice?
It is clear from the agreed statement of facts tendered by the parties that Mr Foster has not vacated the premises as required by the notice of termination.
For those reasons, the matters in 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 Foster.
The first steps towards construction of an airport
In the late 1980s and 1990s the Commonwealth undertook a land acquisition program in the Badgerys Creek area to acquire and reserve the land needed for an airport in Western Sydney. The acquisition program resulted in the acquisition by the Commonwealth of a large number of individual titles in the suburbs of Badgerys Creek, Luddenham and Greendale.
A 2012 Joint Study on aviation capacity in the Sydney region, commissioned jointly by the Commonwealth and NSW governments, identified that the demand for passenger journeys in the Sydney region was forecast to more than double over the next 20 years and to double again by 2060.
On 15 April 2014, in a joint release with the then Prime Minister Mr Abbott, the Minister for Infrastructure and Regional Development, Mr Truss announced that the site for Western Sydney’s new airport would be Badgerys Creek. He announced that, although the airport would not be fully operational for a decade, planning for the new airport would start immediately and construction should start in 2016. He also said that, because of the time it takes to plan and build an airport, the Government’s approach would be to build the roads first and the airport second. It was envisaged that most of the cost of the airport would be met by a private sector operator.
The evidence in respect of the development of the site for the airport was given on behalf the Commonwealth by Peter Robertson, a General Manager at the Department of Infrastructure and Regional Development. He is one of three Senior Executive Service staff members managing the proposed Badgerys Creek airport project and has been engaged on it since the establishment of the Western Sydney unit which is tasked with the management of the proposed airport. Mr Robertson is responsible for management of policy development for the project and project timeframes.
In an affidavit affirmed on 25 June 2015, Mr Robertson set out a number of reasons why vacant possession was urgently required by the applicant. These reasons included enabling the Commonwealth to comply with its contractual obligations and project timetable, the growing incompatibility of continued residential accommodation and the ongoing investigation and demolition works both in terms of cost and delay impacts on the work at the site, and concerns as to the safety and security of the remaining tenants and the site.
Mr Robertson explained that planning for an airport requires substantial on-site technical work including extensive investigations to support environmental assessment and geotechnical work by engineers and other consultants.
In light of the occupation of parts of the site by the remaining tenants, the work had been either been tailored to parts of the site of which the Commonwealth had possession, or, alternatively, liaising with tenants to ensure that testing could be conducted safely without unnecessary disturbance. Mr Robertson explained that the additional work and costs that have resulted from working around tenants were “considerable”, although he did not give any further detail in that respect. Notably, his evidence did not deal directly with the part of the site on which the Fosters’ home is located. Indeed, his evidence was that the planning, assessment, site management and preparation activities for the airport site were being undertaken on a “whole of site” basis for all of the land to be included in the airport site.
Mr Robertson described the process for accessing residential tenant blocks as being “extensive and time consuming”. The steps usually followed in accessing residential properties were:
a)Identify sites for access: contracted specialists would identify access requirements for all specialist investigations on the site and then submit a request for access to the Department. That request would then reviewed by the Department in considered consultation with the property manager. Alternative access options would be identified should there be tenancy considerations.
b)Seek consent from tenants: once the final list of survey sites was determined then the Department would liaise with existing tenants by way of letters prepared by lawyers and follow-up telephone calls.
c)Where tenants refuse access: a new survey site would need to be identified in accordance with the previous steps.
d)Finalise access sites: when tenants are notified and consent is received the lists of sites for access is finalised, mapped and sent to contracted specialists to be given to the survey team.
e)Access to sites on the day of investigations.
Mr Robertson explained that the constant requirement to seek consent had implications for the achievement of the projects timeframes and generated substantial costs with uncertainties relating to access causing “serious obstacles to planning, delay and costs for work on site”.
Mr Robertson stated that a minimum of 9 to 12 months was expected to be required to clear the Badgerys Creek site and that that timeframe was only achievable with multiple contractors working concurrently on the site with limited unfavourable weather. The expectation was also based on the assumption that there were multiple structures requiring demolition on 182 remaining properties after June 2015.
In an affidavit affirmed on 10 August 2015, Mr Robertson gave evidence that the entire site had now been declared as an airport site under the Airports Act 1996 (Cth) by operation of the Airports Legislation Amendment (2015 Measures No. 1) Regulation2015 (Cth) which was registered on 24 July 2015. He explained that one of the consequences of that declaration was that airspace could now be declared to aid in the prevention of any incompatible development taking place around the airport site that might limit its potential development as an airport.
As at 6 August 2015, 68 of an estimated 233 properties had been demolished, and 33 further properties had been allocated for demolition to be completed before mid-September 2015, weather permitting. Mr Robertson said that there were still approximately 165 properties requiring clearance of structures and that only 45 of the 165 properties were available for demolition. Over 45% of the properties on site that require demolition had been cleared of structures. Further, 103 of an estimated total of 163 tenants had vacated the site, noting some tenants have occupancy arrangements over multiple properties.
Preparation for development by a private sector operator
As was mentioned in the 15 April 2014 joint press release, the Commonwealth envisaged that the costs of the airport would be principally met by a private sector operator. Mr Robertson gave evidence about the contractual processes being undertaken by the Commonwealth in connection with that operator.
Mr Robertson stated that when the Commonwealth sold Sydney (Kingsford Smith) Airport to the Sydney Airport Group in 2002, the sale agreement included terms granting an opportunity to the purchaser to develop and operate any second major airport in the Sydney region within 100 kilometres of the Sydney GPO. That sale agreement detailed the process and timeframes for consultation between the government and owners of the Sydney airport on the development and operation of a second airport. Those processes were not in evidence before me.
As Badgerys Creek is located approximately 56 kilometres from the Sydney GPO, the right of first refusal in the airport sale contract were applicable. That right of first refusal includes a number of phases including a consultative phase and a contractual phase. Those phases are expected to take between one and two years to complete.
On 30 September 2014 the Commonwealth government issued a “Notice to Consult” to the Sydney Airport Group advising that the consultative phase of the process would commence on 1 October 2014. The notice specified that the consultative phase would take nine months and so expire on 30 June 2015.
Mr Robertson explained that, following the consultative phase, the government may enter a contractual phase which would involve the issuing of a “Notice of Intention” to the Sydney Airport Group which would include detailed terms for the proposed development and operation of an airport at Badgerys Creek including technical specifications, contractual terms and a timetable. The Sydney Airport Group would then have the opportunity to exercise its option to develop and operate the airport at Badgerys Creek. If it declined that opportunity, the Commonwealth would be entitled to approach the market, or develop and operate the airport itself.
Mr Robertson gave evidence that while consultation was currently underway and a final decision on the airport proposal had not yet been made, a clear site was necessary to allow for investigations of the site to inform any proposal that could be made to the Sydney Airport Group or the market or in order to determine whether development would be carried out by the government itself. Essential to any proposal is the outcome of the environmental impact assessment process, geotechnical and engineering investigations, archaeological surveys, and other site interrogations.
Mr Robertson said that any second airport for Sydney would be a substantial piece of national transport infrastructure utilising a site measuring in the order of 1700 hectares and would be a key resource for the operation of the New South Wales and national economies because of its significance to air transport and a number of associated industries. That must be correct as a matter of common experience and I accept it.
The agreed facts
The facts set out above were not disputed by Mr Foster. In addition to those, as I have noted, the parties tendered an agreed statement of facts which were signed by Mr Foster and by a solicitor for the Commonwealth. I set out below those facts in the agreed statement that I have not already set out above.
The residential tenancy agreement between the parties contained a special condition, cl.53.1 that stated: “The tenant acknowledges that the premises forms part of the proposed site for Sydney West Airport”.
On 29 October 2014 a letter was sent to Mr Foster (at the address noted in the tenancy agreement) by the Commonwealth’s agent Preston Rowe Paterson (PRP) which informed him inter-alia:
a)“The Australian Government on 15 April 2014 announced that land owned by the Australian Government at Badgerys Creek will be the site for Western Sydney’s airport. I am writing to provide information about what this decision means for you, as an occupant on the Australian Government owned land at Badgerys Creek”.
b)“Since the date of acquisition, the land has been owned by the Australian Government in anticipation of a future decision on the location of an airport. The Government has now made that decision.”
c)“The Government has recently commenced consultation with the Sydney Airport Group about developing and operating an airport at Badgerys Creek.”
d)“To implement the Australian Government’s decision, all properties on the site, including the property you occupy, will need to be vacated.”
e)“In the coming weeks, you will receive a formal notice of termination of your tenancy. That notice will provide a specific date by which you will be required to vacate the property. It is likely that this date will be in June 2015 - but it will not be earlier.”
The letter invited Mr Foster to contact a Wendy Salkeld by email or phone to discuss the contents of the letter or if he had any questions about the process.
On 24 November 2014 PRP issued a Notice of Termination addressed to Mr Foster (at the address noted in the tenancy agreement) together with a checklist outlining tenants’ obligations when vacating premises. The Notice of Termination and accompanying checklist were delivered to Mr Foster on 26 November 2014 by a licensed process server.
The Notice of Termination notified Mr Foster inter alia:
“The Commonwealth hereby gives you notice under section 85 of the [Residential Tenancies Act 2010 (NSW)]:
1)terminating the Tenancy Agreement in respect of the Premises on 15 June 2015 (the Termination Date); and
2)that You are required to give vacant possession of the Premises to the Commonwealth by the Termination Date.”
Information was provided with the Notice of Termination which included an invitation to Mr Foster to contact PRP if he had “any questions or wish[ed] to clarify anything on the checklist”.
On 10 June 2015 a letter was sent to Mr Foster (at the address noted in the tenancy agreement) by PRP which reminded him of the requirement to vacate the Premises on or before 15 June 2015 and informed him that if he failed to do so, the Commonwealth “will apply to the Court for an order for possession of the property in accordance with the law”. The letter enclosed “Vacate Information for Residential Tenants on Commonwealth-owned Land at Badgerys Creek”. This included information about the initiation of court processes should Mr Foster fail to leave by the required vacancy date.
Mr Foster has not given vacant possession of the Premises.
The agreed statement of facts then included the following facts relevant to the Fosters’ relocation.
In June 2011 Mr Foster fell off a 15 foot bridge and broke his back in two places, his neck in four places, his wrist and his shoulder. Mr Foster’s only income is workers’ compensation payments from WorkCover as a result of sustaining this injury. He needs to remain in the Sydney area in order to continue receiving payments from WorkCover and in order to attend a three-month rehabilitation scheme.
About three months ago, Mr and Mrs Foster paid a $200 holding deposit in order to rent a particular property on Colo Road, Windsor. The landlord has an existing tenant in the relevant property who is going to move out on 28 November 2015. The landlord requires one month from that date to clean and paint the property and to undertake minor tasks in relation to that property.
Mr Foster and his wife estimate they need two weeks to move their various possessions out of the Premises and into the new premises on Colo Road. Mr and Mrs Foster have 8 horses, 8 cats, 10 Chihuahuas and 250 racing pigeons.
All of the Fosters’ possessions and sheds have been cleared from the land and are ready to be moved to a discrete part of the Premises. Everything in the house on the Premises has been packed up. The Fosters are residing in a single room in the house waiting to move.
No one else is living on the Premises.
Mr and Mrs Foster are aware of the Commonwealth’s urgent need for vacant possession of the Premises. They are confident they can move out of the Premises with all of their belongings by no later than 15 January 2016. They will do so earlier if possible (for example, in the event the Colo Road property becomes available earlier than expected, or if another suitable property becomes available earlier than the Colo Road property).
Conclusion
Having considered the circumstances of this case as outlined above, I am satisfied that the appropriate date on which Mr Foster is to give vacant possession of the Premises is 15 January 2016 on the basis of the following reasons.
First, I fully accept the general importance of the development of a further airport in Sydney for both the economic and social wellbeing of this state, if not, this country.
Secondly, 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.
Thirdly, the safety of individual tenants will decrease as more and more tenants vacate the site.
Fourthly, Mr Foster 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.
Fifthly, Mr and Mrs Foster have acted very reasonably in obtaining suitable alternative accommodation. Their intention to vacate the property as soon as the new premises are available is not disputed by the Commonwealth and I accept that they will do so.
Sixthly, and most importantly, Mr Foster’s considerable injuries, dependence upon WorkCover payments and need for rehabilitation has considerably restricted his ability to locate alternative accommodation and to undertake a move to such accommodation. It is principally for that reason, together with the Fosters’ good faith, that in spite of the relative urgency of the Commonwealth’s need for vacant possession, I consider that it is appropriate that the Fosters have until 15 January 2016 to give vacant possession of the property. At the hearing I asked Mr Rayment, Counsel for the Commonwealth, if he had any submissions to make about the reasonableness of the Fosters’ wish to stay on the premises until 15 January 2016. Mr Rayment said that he had no submissions to make on that issue. In my view, the Fosters’ wish is, in the circumstances, entirely reasonable.
For those reasons, I make the following orders:
1)The residential tenancy agreement in relation to the premises at 60-70 (formerly Lot 65) Leggo Street, Badgerys Creek NSW 2555 be terminated with effect from 2 October 2015.
2)Vacant possession of the premises be given to the Applicant on or before 16 October 2015.
3)The order for vacant possession be suspended to 15 January 2016.
4)There be no order as to costs in relation to the proceedings.
I certify that the preceding eighty-eight (88) paragraphs are a true copy of the reasons for judgment of Judge Smith
Associate:
Date: 2 October 2015
2
4
11