Cope & McEachern v Walker & Walker
[2018] ACAT 65
•21 June 2018
ACT CIVIL & ADMINISTRATIVE TRIBUNAL
COPE & MCEACHERN v WALKER & WALKER (Residential Tenancies) [2018] ACAT 65
RT 1067/2017 and RT 335/2018
Catchwords: RESIDENTIAL TENANCIES – whether rental premises are ‘not fit for habitation’ – need for tenant notification to engage a lessor’s obligation to repair – compensation to tenant for unusable main bathroom because of mould – onus of proof in making claims for compensation
Legislation cited: Residential Tenancies Act 1997 s 83; standard terms 55, 56, 57, 60, 63, 82, 86, 87
Cases cited:Bannister v Cheung [2014] NSWCATCD 105
Brogan Prestige Properties v Strand & Black [2010] ACAT 60
Finn v Finato [2004] NSWCTTT 179
Halcombe v Hitchman [2018] ACAT 5
Koesmarno v Mutis [2015] ACAT 89
Mathew & Anor v Barranco [2016] ACAT 102
Tankard and Anor v Ogbonna and Anor [2017] ACAT 72
Timms & Simpson v Adams [2012] NSWCTTT 53
Winder v Grehan [2013] NSWCTTT 247
Tribunal: Presidential Member G McCarthy
Date of Orders: 21 June 2018
Date of Reasons for Decision: 21 June 2018
AUSTRALIAN CAPITAL TERRITORY )
CIVIL & ADMINISTRATIVE TRIBUNAL ) RT 1067/2017
RT 355/2018
BETWEEN:
TIMOTHY COPE AND ANDREA MCEACHERN
Applicants/Tenants[1]
[1] In proceeding RT 335/2018 arising from the bond being held in dispute, Timothy Cope and Andrea McEachern are named as the respondents and Crispin Walker and Yvette Walker are named as the applicants. The Tribunal proceeds by reference to the parties named in proceeding RT 1067/2017.
AND:
CRISPIN WALKER AND YVETTE WALKER
Respondents/Lessors
TRIBUNAL: Presidential Member G McCarthy
DATE: 21 June 2018
ORDER
The Tribunal orders that:
The Office of Rental Bonds pay the amount of the bond held in dispute ($2,780) to the applicants/tenants.
………………………………..
Presidential Member G McCarthy
REASONS FOR DECISION
On 22 January 2017, the applicants leased a residential property in Macquarie, ACT, from the respondents, for a fixed term of 52 weeks commencing on 22 January 2017 to 21 January 2018. The rent was $695 per week. The applicants paid a bond of $2,780 to the Office of Rental Bonds, the whole of which is now held in dispute.
The applicants had been in possession of the property as tenants under an earlier lease with the respondents since 22 January 2016. The applicants’ occupation of the property had continued seamlessly from the former lease to the latter.
At all material times, the respondents, Mr and Mrs Walker, lived in the United Kingdom. On the evidence, Mrs Walker took no role regarding the lease and left the management of the property to her husband.
Under the former lease, the respondents had engaged a property agent to manage the lease on their behalf. However, for the lease in question Mr Walker decided to manage the property himself despite living in the United Kingdom.
During the latter half of 2017, relations between the applicants and Mr Walker deteriorated because of ongoing maintenance issues, delays in rectifying those issues and differences of opinion as to who was responsible for the maintenance.
On 21 December 2017, the applicants sent the respondents a notice of intention to vacate on the grounds, they said, that the premises were unfit for habitation. The notice stated that, for this reason, the tenancy would end on 24 December 2017, being two days from the date of the notice. The applicants vacated the premises on 24 December 2017 and ceased paying rent from 25 December 2017.
On 21 December 2017, the applicants also filed an application with the Tribunal seeking an order terminating the tenancy agreement with effect from 24 December 2017, an order that the respondents pay them $2,000 by way of compensation for defects during the tenancy detailed below, and return of their bond ($2,780).
Mr Walker disputed the notice to vacate and sent the applicants notices to remedy dated 2 January and 15 January 2018 for unpaid rent.
By amended response dated 11 April 2018, the respondents disputed the entirety of the applicants’ claim and made a cross-claim for $9,372 comprised of $2,780 for unpaid rent from 24 December 2017 to 22 January 2018 when the lease would have terminated, $2,550 for the cost of replacing a bathroom ceiling and $4,042 for additional damage to the property.
On 18 January 2018, the Tribunal ordered that the tenancy had ceased and that the respondents have vacant possession. The parties agreed that the effect of the order was to cease the tenancy as at that date, at the latest, with the question whether the lease had terminated on 24 December 2017 remaining to be decided.
I deal in turn with the topics regarding which the parties claim compensation.
Unpaid rent
The applicants submitted that as at 21 December 2017 the property was uninhabitable. They referred to water damage in the main bathroom that had been reported but not actioned, possible wildlife (a possum) in the roof cavity space that had been reported but not actioned, that the main bathroom had been unusable for five months because of extensive mould, a health risk from possible mould, a kitchen ceiling leak, water leaking onto a kitchen bench and a gate to the carport that had been broken for approximately six months.
The applicants relied on clauses 86 and 87(2) of the standard residential tenancy terms in schedule 1 to the Residential Tenancies Act 1997 (the RT Act), which state:
86 The lessor or the tenant may, by written notice, terminate the tenancy on a date specified in the notice on the following grounds:
(a) the premises are not fit for habitation;
(b)the premises are not available or will not be available because of Government action within a period of 4 weeks of the date that notice is given.
87(1) In either case the lessor must give not less than 1 week’s notice of termination of the tenancy, and the rent abates from the date that the premises are uninhabitable.
(2)The tenant may give 2 days notice of termination of the tenancy.
(3)If neither the lessor nor the tenant give notice of termination of the tenancy, the rent abates for the period that the premises are unable to be used for habitation, but the tenancy resumes when they are able to be used again.
In Finn v Finato[2] the NSW Consumer, Trader and Tenancy Tribunal (NSWCTTT) noted judicial statements regarding the words ‘fit for habitation’ as follows:
18.The leading decision which guides the Tribunal in relation to this standard of habitability is Summers v Salford Corporation [1943] AC 283 in which Lord Atkin said:
“If the state of the repair of the house is such that by ordinary user damage may naturally be caused to the occupier either in respect of personal injury to life or limb or injury to health, then the house is not in all respects fit for habitation..... it is clear that premises may be unfit for human habitation even though it is physically possible for a tenant to reside in the premises.”
19.In McLeish v FT Eastment & Sons Pty. Ltd (1970) 91 WN (NSW) 268 CA the Court in reliance upon Proudfoot v Hart (1890) 25 QBD 42 considered the words “ fit for habitation” and “tenantable repair “ and whether there was a difference. This is relevant to a consideration of section 25(1) of the Act, which imports both concepts. The Court stated:
“must both import such a state as to repair that the premises might be used and dwelt in, not only for safety , but for reasonable comfort, by the class of persons by whom and for the sort of purpose for which, they were to be occupied.....(emphasis added)
The conclusion I draw... is that the landlord is obliged to hand the premise over to the tenant, at the commencement of the lease, in a reasonable state of repair having regard to its age, rent payable and the prospective life of the premises, and the state of the repair must at least meet the minimum standard inherent in the contemporary understanding of the term “fit for habitation”. .... .(emphasis added)
[2] Finn v Finato [2004] NSWCTTT 179 at [18]-[19], cited in Mathew & Anor v Barranco [2016] ACAT 102
In Bannister v Cheung[3] the NSW Civil and Administrative Tribunal (NCAT) added:
18. In Hampel v South Australian Housing Trust [2007] SADC 64, Milsteed J stated (at [63]):
“In my opinion, a house is unfit for human habitation if an occupier could be expected to suffer physical injury or injury to health from the ordinary use of the premises. It may be so unfit for any reason. The risk to health or safety may arise because the premises are in a state of disrepair or dilapidation or because of a lack of facilities such as the provision of adequate water, light, ventilation, and so on.”
…
20. The test of “fit for habitation” is objective, rather than subjective. Residential premises may be unfit for habitation, even if the landlord is unaware of the defect. However, in De Solei v Palmhide Pty Limited [2010] NSWCTTT 464, the Tribunal noted that the test of proving that premises were not fit for habitation was a difficult one for a tenant to satisfy and a finding that premises are not fit for habitation is not to be lightly made. …
21. There has been a number of decisions of the Tribunal which have found that premises have been so affected by mould that premises have not been fit for habitation (e.g.: Roberts v Bell [2001] NSWRT 6; Finn v Finarto [2004] NSWCTTT 179; Bartley and Zawiolkowski v Harris Park Holdings Pty Limited [2010] NSWCTTT 592). In such cases, there was evidence of significant mould in the premises and the mould problems had not been addressed by the landlord over a period of time
[3] Bannister v Cheung [2014] NSWCATCD 105 at [18]-[22]
From these statements, it is clear that whether premises are fit for habitation is a question of fact, referenced to the nature and purpose of the property, the class of persons using it and contemporary standards.
17.I am not persuaded that the premises in this case were unfit for habitation. The applicants were concerned that mould in the bathroom was a health risk. In my view they reasonably elected not to use the main bathroom for that reason, but they were able to use the alternative ensuite bathroom and did so for many months. The cases referred to in Bannister v Cheung in which the NCAT found the premises to be uninhabitable because of mould involved many rooms in the rented house affected by mould.
On the applicants’ own case, the alleged leak in the kitchen was a drip. The possibility of a possum in the roof cavity did not cause the living areas to be uninhabitable. To the extent that these defects were the subject of separate claims for compensation, I disallow them.
The defects upon which the applicants relied had existed for months. Where the applicants had been living in the property all that time, I am not persuaded that the property became uninhabitable on 21 December 2017 without any change on or about that time to the condition of the property.
The applicants accepted that if their termination of the lease under clause 87(2) with effect from 24 December 2017 was not validly exercised, rent was payable until 18 January 2018.
Mr Walker contended that rent was payable until the conclusion of the lease on 21 January 2018, as a matter of contract, regardless of the Tribunal’s order. The logic of this argument was elusive: the Tribunal terminated the lease with effect from 18 January 2018 meaning that the contract ended on that day.
For these reasons, I am satisfied that the tenants are liable for further rent for the period 25 December to 18 January 2018 inclusive, a period of 25 days. Where the property was let at a weekly rent of $695, I allow a daily rental of $99.30. I find that the applicants owe the respondents $2,482.50 by way of unpaid rent.
Carport side gate
The property included an area to the side of the house covered with a carport and secured by a timber fence approximately 1.8m high and two timber gates, one larger than the other, facing the street. The tenants owned motorbikes, and kept them under the carport. They also owned a dog which they kept, secured, in the backyard. For them, it was important that the gates were lockable and in working order to protect their motorbikes from theft, to provide daily ready access between the carport and the street and to prevent their dog escaping.
The applicants contended that the carport gates had been broken or at least in disrepair since November 2016 and were not properly repaired until 5 July 2017. They seek compensation of $40 per week for a period of 32 weeks to total of $1,280.
Under section 83(d) of the RT Act the Tribunal may make:
an order requiring the payment of compensation for loss of rent or any other loss caused by the breach of a residential tenancy agreement or occupancy agreement (emphasis added)
It follows that I must reject the applicants’ claim for compensation in the period from November 2016 to 21 January 2017 because any loss in that period did not arise from a breach of the tenancy agreement. I have considered the claim in the context of the period 22 January to 5 July 2017.
I am satisfied that the gates had fallen into disrepair over time. An incoming condition report dated 9 February 2017 states “front gate broken”. The applicants and Mr Walker periodically exchanged emails about the ongoing problems with the gate, despite it being repaired in March, April and July 2017.
On 21 June 2017, the applicants sent Mr Walker an email stating:
And the catch on the gate cannot be re-positioned as the gate has been lifted so far that the cross beams do not align, so there is nowhere to mount a latch. We have an ocky strap holding it closed at the moment. Also it’s starting to come out of the wall again. The same problem still exists where the post that holds the larger gate has sagged, so it puts pressure on the gate mounted to the wall and slowly levers it out of place.
The lack of access is becoming a little frustrating to be honest, it takes ten minutes to get our motorbikes out of the carport after we finish putting everything back together. Garden maintenance is difficult, and in high winds the Ocky strap doesn’t hold and the dog keeps escaping. The alternative is to tie it up permanently again each means no access at all, no security for the bikes unless we want to leave them in the backyard permanently like we have already done for close to 6 months now, and yard trimmings have to go over the front deck. Also the guy that came around did not fix the rear gate. So the only accessible gate to the yard at the moment [is] the one behind the carport. This is not the level of maintenance one expects when paying $700 a week rent.
Mr Walker contended that the respondents did all that they were reasonably required to do to repair the gate. He contended that each time the applicants reported the gate was faulty he organised for it to be repaired. He relied on the evidence of Mr Heston, who said that he carried out three separate repairs to different parts of the gate in mid-March, April and July 2017. Mr Heston gave evidence that after each repair the gates were working and “able to be locked”.
The statement in the incoming condition report that the gate was broken did not excuse the respondents from their obligation to fix it. There is no suggestion from the respondents to that effect, and the respondents’ efforts to repair the gate from time to time count against that suggestion. The statement of the defect in the incoming condition report demonstrates that the respondents were aware of the defect from the commencement of the tenancy. That was one of the purposes of the incoming condition report.[4]
[4] Winder v Grehan [2013] NSWCTTT 247 at [42]
Clauses 55-57 of schedule 1 to the RT Act set out the statutory structure that governed the respondents’ obligation to maintain the premises in a reasonable state of repair:
Lessor to make repairs
55(1) The lessor must maintain the premises in a reasonable state of repair having regard to their condition at the commencement of the tenancy agreement.
(2) The tenant must notify the lessor of any need for repairs.
(3) This section does not require the tenant to notify the lessor about anything that an ordinary tenant would reasonably be expected to do, for example, changing a light globe or a fuse.
56The lessor is not obliged to repair damage caused by the negligence or wilful act of the tenant.
57Subject to clause 55, the lessor must make repairs, other than urgent repairs, within 4 weeks of being notified of the need for the repairs (unless otherwise agreed).
Urgent repairs are described in clause 60 and include a fault or damage that causes the residential premises to be unsafe or insecure. The applicants claimed that because the gate was not lockable, the premises were insecure and that their motorbikes were therefore at risk of theft. They claimed that the four weeks ‘grace’ period under clause 57 within which the respondents could carry out the repairs without being in breach of the lease was therefore not applicable and that compensation is payable for any period when the gate could not be locked to secure the carport.
‘Premises’ is defined in the Dictionary to the RT Act to include any habitable structure, whether it is fixed to the land or not; part of any premises; and any land, buildings or structures belonging to the premises. The carport and the gate are therefore ‘premises’. However clause 60(k), which describes a kind of repair that constitutes an urgent repair in relation to [rented] premises, states:
a fault or damage that causes the residential premises to be unsafe or insecure
In my view, the additional word ‘residential’ before ‘premises’, where only the word ‘premises’ is used elsewhere in clause 60, makes clear that security as an urgent repair applies only to that part of the premises in which the tenants reside. It follows that a repair to make secure an external shed, an external garage or in this case a carport is not an urgent repair. The respondents therefore had four weeks to conduct the repair from when it was notified.
As mentioned above, the respondents were aware that the gate was broken from commencement of the tenancy. A four week period to fix it therefore commenced from that date. It follows that the respondents were in breach of clause 57 from 20 February 2017 and remained in breach until the gate was repaired in ‘mid-March’. I allow four weeks.
There is little, if any, evidence after mid-March 2017 to show that the applicants notified the respondents that the gate was again defective. They rely on correspondence dated 15 November 2016 (prior to the commencement of the lease) regarding the defective gate but that only confirms that the respondents were aware of the defective gate from commencement of the lease. Otherwise, the only correspondence regarding the gate is the applicants’ email sent on 21 June 2017 quoted above. Further, on 22 June 2017, the respondents replied by stating “I appreciate your frustration at the gate. However, I would comment that this is the first time I have been advised of additional problems”. The respondents then offered a resolution of the problem at their own cost.
There must have been other communications that led to Mr Henson again repairing the gate in April, but nothing was provided.
I accept that the defective gate was an ongoing problem, and that the applicants dealt with it as best they could from time to time and in different ways, but that is not a basis to order compensation. In my view, a tenant cannot acquiesce regarding a defect and then after the event claim compensation. A breach of clause 57 arises where a lessor does not make repairs “within four weeks of being notified of the need for the repairs”. Evidence of notification is, therefore, essential to establish the breach.
There is no evidence of any further notification until 21 June, and the applicants agreed that the gate was again repaired on 5 July 2017.
For these reasons, I allow four weeks for the period 20 February 2017 to ‘mid-March’ but otherwise disallow the claim.
Regarding quantum, I accept that the security of the carport was an important consideration for the applicants, but the defective gate did not render the carport insecure. Rather, it caused significant inconvenience to the applicants by them having to secure the gate by alternative time-consuming means and on a daily basis. Doing the best can, I allow $25 per week compensation to a total of $100.
Mould
The incoming condition report dated 9 February 2017 states in relation to the main bathroom “small amount of mould”.
On 21 June 2017, the applicants wrote to Mr Walker as follows:
Please note that the bathroom ceiling is waterlogged and covered in mould. We couldn’t remove the mould as much as we cleaned it, so we started sanding it to re-paint it when we discovered it was completely full of water. I am not a roofing specialist so I’ll take photos and tell you what I know, but my explanations will be amateur. As this presents a substantial health issue to anyone who uses the bathroom, a reasonable turn-around time and professional advice would be appreciated.
Mr Walker replied the following day, 22 June 2017, stating:
Thanks for the latest advice-the bathroom certainly sounds like an issue and accordingly I have commenced a discussion with my insurer. It would be very helpful to see some photos of the damage ahead of formalising a claim.
On 5 July 2017, the applicants replied:
I will attach the photos of the bathroom and inside the roof. I clean the mould all the time but I’m fighting a loosing (sic) battle.
On 5 July 2017, Mr Walker replied:
Any pics of the bathroom roof? Will need to pass on to my insurer.
Later that day, 5 July 2017, the applicants sent photographs of the mould to Mr Walker.
It appears that the mould was not addressed over the following months because, on 18 September 2017, the applicant sent another email to Mr Walker stating:
I’m also wondering if you have plans for the bathroom. The mould is getting worse and I’m struggling to keep it at bay. My son is also an asthmatic and am worried its black mould, he is having to use the ensuite shower ATM.
On 28 September 2017 Mr Walker replied:
In regards to the bathroom did the insurer (Coles insurer) not contact you directly? I triggered a claim at least a few months ago. If not that is really poor service. I will speak to them again asap to find out what is going on.
Later that day, 28 September 2017, the applicants replied:
Hi, I have not heard from anyone, but I did recently change my number. They can also email me if you give them this email address.
On 13 October 2017, Mr Walker sent an email to the applicants as follows:
Just emailing to provide an update on the bathroom repair.
Unfortunately after much correspondence with my insurers, they have advised that the type of damage likely isn’t covered by my policy and my excess is not likely to assist, so that door has closed. Gave them a blast poor customer service and not contact (sic) you.
I have also tried numerous trade contracts (sic) in Canberra to come and take a look but almost everyone is either on holidays or busy for weeks in advance.
I will keep trying to lock in a tradesperson to come around and quote me for a repair. Do you happen to know anyone who may be in a position to take a look and quote? Of course I’d like to have a fully costed quote before agreeing to the work being undertaken, and receipts etc
On 14 October 2017, the applicants replied:
Morning. Bloody insurance companies, that’s really bad. I know a few people I can ask. Keep you posted. Thanks for the up date.
On 16 October 2017 the applicants sent an email to Mr Walker as follows:
Hey. I found this guy who is local. I’ve left messages with another company, they also charge 299 for quote.
This guy advised me not to use the bathroom and not try and clean it as it can spread. I told him I will pass this on and you can email him. Thanks.
On 17 October 2017, Mr Walker replied:
Thanks for the update. I’d expect to see a quote before agreeing to the work being done. Are you really saying a company really wants $299 just to get a quote? That is a liberty. A quote should be free - won’t be going with them!
I will still keep looking for a suitable company to use as well.
Later that day, 17 October 2017, the applicants replied:
The cash for the quote goes back towards the bill if you choose them.
I called another companies (sic) and they all seem to charge between 250-299 for a quote.
We are all using the ensuit (sic) bathroom at the moment, both companies told me that it should not be used.
I’ll keep looking around for someone else who might be cheaper.
Later that day, 17 October 2017, Mr Walker replied:
I figured it would have to be reimbursed. Since when have you had to pay for a quote in Australia?! That is outrageous. Really anti-competitive.
On 18 October 2017, the applicants replied:
Hi, I have found another company whose price for quote of much cheaper. I have forwarded the email. cheers
The applicants forwarded the company’s email to Mr Walker as part of an email chain which stated the company’s recommendation that it attend the property and assess the affected areas and then provide a report with its findings. The email stated that their initial assessment report fee would be $165 and that the report would detail the mould remediation works required and the cost. The email stated they would be available to conduct the assessment on 23 October 2017.
Mr Walker did not respond to that proposal. Instead, on 25 October 2017 he sent an email to the applicants as follows:
Looks like I found someone who can come and quote - friend of the family who is qualified. No need to pay for a quote (still can’t believe that Australia has come to that). Anyway currently in negotiations but will email you with details to arrange a visit so he can see the work to be done.
On 15 November 2017 the applicant sent an email to Mr Walker as follows:
The bathroom guy came over the other day, I was wondering if he has contacted you with a timeframe for the repairs? Tim has family visiting from NZ over Christmas and it’s stressing me a bit that we only have an en suit (sic) shower.
Can you let me know as soon as you know if he is doing the work before Christmas.
On 16 November 2017 Mr Walker emailed a person named “Matt”, presumably the “friend of the family who is qualified”, as follows:
Hi Matt
Understand you’ve been around to the house to the a look (sic). Any views on what needs doing, timeframe and costs?
There is no evidence regarding any response from “Matt” or of any further communication from Mr Walker to the applicants, particularly in response to their question as to whether the work would be done before Christmas.
On 5 December 2017, the applicants sent an email to Mr Walker proposing early termination of the lease. Among their reasons was the following:
With regards to the recent bathroom situation, we have had to cancel plans with family over the Christmas period and the children have arranged alternative living arrangements as it has become highly inconvenient sharing an ensuite between us. It has been a substantial amount of time since the issue was reported, and I feel we have been most patient and graceful in paying full rent over this period while not having full access to the facilities listed in the lease…
We would like to request that we end our tenancy a short time before the lease actually expires, over the Christmas break to be specific. We hope that you will be understanding and show compassion to our situation, as instead of spending Christmas with family we have had to cancel as the original feedback from the ceiling repairman was that he would not be able to complete the job until after Christmas. Having said that the job has commenced, but it seems our ceiling is being fit around the repairer’s full time occupation and there have only been sporadic instances where he has been able to progress with the bathroom. We are still unsure as to when the bathroom will be usable again and are still unable to plan for family members to stay.
On 8 December 2017, Mr Walker sent an email to the applicants stating:
Just emailing to acknowledge your email and request received earlier this week-which I’m still considering.
In the meantime can you please pay the outstanding water bill…
On 14 December 2017, the applicants replied:
Just letting you know water bill was paid today, sorry for the late payment. Also just letting you know the bathroom is still not finished.
On 19 December 2017, the applicants sent a further email to Mr Walker, the relevant parts of which were as follows:
We hope you have considered our proposal to mutually agree on an early termination of lease…
Given the recommendation from a qualified mould inspector that the property surrounding the main bathroom should be inspected for dangerous mould as it could have spread past the bathroom ceiling, a recommendation made based on evidence of further water damage to the internal wall space of the bathroom, the absence of an inspection by a qualified mould inspector is grounds to vacate within two days with no rent payable until the property can be deemed safe for habitation and accessible with consideration to the original lease.
On 20 December 2017, Mr Walker replied:
I emailed (sic) to formally advise that your request for an early termination of the current lease agreement is politely declined. I see no reason to depart from the legally binding tenancy agreement between us.
…
In regards to mould in the bathroom - you mentioned the ‘recommendation of a qualified mould inspector’, yet you have never provided any evidence of their engagement, asked me that a formal inspection be done, or provided any report beyond anecdotes, of any findings. Whilst the mould may be unsightly it is NOT a health hazard and does not impact on the functional use of the bathroom. Moreover there was no application to vacate at the time or significant complaint including asking for a rental refund - only the threat to do so now that you want to break the lease early. It could be argued in the alternative that your failure to properly ventilate the bathroom during and after use has caused the mould.
The parties quickly fell into dispute.
The applicants’ claimed compensation of $2,400, being $100 per week for the period 16 June 2017 to 24 December 2017 (24 weeks) arising from the main bathroom being “unusable” through to the date when they vacated the property on the grounds that it was uninhabitable. They contended that during this period all family members had to use the ensuite bathroom which was, at times, highly inconvenient especially where an adult child was working “hospitality hours” and the only other option was to walk across the backyard to separate building described as a studio with an ensuite shower.
The respondents deny any liability, Mr Walker contending that “the bathroom was usable at all times - water run, electricity was on, bath and shower functioned”. Mr Walker contended that “no other reports were provided of ‘dampness’ - this is indicative of a continuing patterns of speculation and unfounded claims by the tenants to further their case.”
In their counterclaim, the respondents hold the applicants responsible for the mould, contending that they “had been repeatedly told to manage the ventilation of the bathrooms and keep the area clean and free from dampness since mid-2016 - almost one year of instruction to keep the area free from mould.”
In response to the applicants’ claim, Mr Walker contended that there is “no evidence” that the mould was a health hazard, “no evidence that the mould caused any of the premises to be unsafe and “no evidence” that there was a leak in the roof.
The respondents seek orders that the applicants reimburse them $2,550 for the cost of replacing the bathroom ceiling and cornice, re-painting and reinstating the ‘Tastic’ down light. They sought a further $800 to cover the cost of a new bathroom vanity unit which was “covered in mould”, replacement of a “mouldy blind”, replacement of a towel rail, replacement and painting of the bathroom door and associated labour costs.
There is clear contemporaneous evidence of severe mould in the main bathroom. Mould was reported in the incoming condition report at the commencement of the tenancy. On 21 June 2017 the applicants reported that the “ceiling is waterlogged and covered in mould”. Photographs sent to the respondents on 5 July 2017 show clear and extensive mould across the ceiling and cornices. I am satisfied on the balance of probabilities that the vanity was “covered in mould”, that the “mouldy blind” had to be replaced and that the whole bathroom was severely affected by mould. The severity is borne out by the respondents’ decision, presumably on advice from a builder, to replace the ceiling and cornices and repaint the bathroom.
I am satisfied from the contemporaneous email correspondence, sent at a time when relations between the applicants and Mr Walker were still cordial, that the applicants elected not to use the bathroom out of concern for the health risks that it presented. In my view, that precautionary measure was reasonable. The email correspondence reports advice to the applicants from two persons contacted for the purpose of inspecting the mould and assessing what remedial action should be taken that the applicants should not use the bathroom.
Mr Walker’s submission that there is “no evidence” that the mould was a health hazard is misconceived. In my view it was entirely reasonable for the applicants not to use the bathroom in circumstances where it was covered in mould and they had received advice not to use it because of the risk that it was a health hazard.
The next question is the cause of the mould.
Mould is caused by dampness or in some way the constant presence of water. It can come from many sources, for example from the ground in the case of rising damp, through poorly sealed windows, from leaks or, in the case of a bathroom, from the constant presence of water or moisture, particularly steam. In issue in this case is the source of the moisture, and thus the cause of the mould. The applicants referred to leaks in the roof, or at least water collecting from somewhere above the ceiling, causing the ceiling to be “waterlogged”. Mr Walker contended that the mould was caused by the applicants’ failure to properly ventilate the bathroom.
The applicants’ claim depends on whether they have established that the respondents have breached clauses 55 and 57 of Schedule 1 to the RT Act as set out above.
The respondents’ claim depends on whether they have established a breach of clause 63 of Schedule 1 to the RT Act which states:
63 During the tenancy, the tenant must—
(a)not intentionally or negligently damage the premises or permit such damage; and
(b)notify the lessor of any damage as soon as possible; and
(c)take reasonable care of the premises and their contents, and keep them reasonably clean, having regard to their condition at the time of the commencement of the tenancy and the normal incidents of living.
From the commencement of the lease, as reported in the incoming condition report, there was mould in the bathroom. However there is no evidence regarding the extent and severity of the mould at that time or the extent to which the severity increased over the following months. More particularly, as discussed in relation to the side gate, the respondents’ obligation to make repairs under clause 57 did not arise until they were notified of the need for the repairs. There is no evidence that the tenant notified the respondent “of any need for repairs” until 16 June 2017 when Mr Cope sent an email to Mr Walker stating that “the ceiling is waterlogged. How would you like us to proceed?”
From that date, under clause 57, the respondents were required to make the repairs within four weeks (there being no agreement to the contrary) unless, under clause 56, the damage was caused by the negligence or wilful act of the applicants.
In this case, therefore, the respondent’s obligation to repair the bathroom (by removing the mould) would not arise if it was caused, as Mr Walker contended, by the applicants’ failure to ventilate the bathroom. For all practical purposes, this mirrors clause 63 under which the applicant’s “must not intentionally or negligently damage the premises” and “must take reasonable care of the premises”.
The structure of clauses 55-57 and 63 is important. A lessor’s obligation to repair arises if it is established, objectively, that the premises are not “in a reasonable state of repair have regard to their condition at the commencement of the tenancy”. In many cases, damage can occur in situations where neither the lessor nor the tenant is at fault or to blame. In this case, there is no suggestion that the respondents were responsible for the deterioration in the condition of the bathroom. Their obligation to repair the bathroom arose from nothing more than the objective fact that it needed repair, regardless of the cause of the damage, unless they can show that the damage was caused by the applicants “negligence or wilful act”. In other words, the respondents’ primary obligation to repair the bathroom arose regardless of fault, and is excused only if fault on the part of the tenants is established.
I draw support from Brogan Prestige Properties v Strand & Black,[5] cited recently with approval in Halcombe v Hitchman,[6] in which the Tribunal said:
… a lessor's obligation to repair under standard residential tenancy terms 54 and 55 is framed in mandatory terms, i.e. the lessor “shall” maintain the premises in a reasonable state of repair. It is therefore not a defence to any landlord to plead that reasonable steps were taken to rectify either patent or latent defects. The test is whether these defects were in fact remedied such as to maintain the premises in a reasonable state of repair
[5] Brogan Prestige Properties v Strand & Black [2010] ACAT 60
[6] Halcombe v Hitchman [2018] ACAT 5 at [48]
In this case, it is clear that the bathroom needed to be repaired. The applicants notified the respondent of the need for the repair on 16 June 2017. It follows that the respondents were required to carry out those repairs and were in breach of clause 57 by failing to carry out those repairs by 14 July 2017 unless the damage was caused by the applicant’s failure to ventilate the bathroom.
On the evidence, I am not persuaded that the applicants’ alleged failure to ventilate caused the mould. All the evidence is to the contrary. The contemporaneous emails establish that the applicants were doing everything they could to “keep the mould at bay”, including scrubbing and sanding, but were fighting a losing battle. It is completely implausible that the applicants went to such lengths to try and control the mould, but did not take such a simple step as ventilating the bathroom by using the exhaust fan or opening a window.
When the applicants reported that the ceiling was waterlogged and sent photographs of the mould covering the ceiling and cornices, the respondent did not reply by suggesting or contending that the applicants were responsible by not ventilating the bathroom. Mr Walker’s emails in reply implicitly accepted responsibility by stating that he would refer the repair to his insurer. So too does his ongoing correspondence with the applicants over the following months endeavouring to find a free quote for the repairs.
The first mention I can find of Mr Walker suggesting that the applicants are (or were) responsible for the mould is in his email of 20 December 2017, responding to the applicants email requesting an early termination of the lease, in which he posed that “it could be argued in the alternative” that the applicants’ failure to ventilate caused the mould.
On the evidence, the apparent source of the water giving rise to the mould was the waterlogged ceiling, not a repeated build-up of steam arising from a lack of ventilation. There is no evidence that anyone visited the premises and expressed an opinion that lack of ventilation was causing the mould. The respondents were in no position to form an opinion, one way or another: they were living in the UK.
Where the respondent has not established that the mould was caused by the negligent or a wilful act of the applicants, the respondents were in breach of the lease by not making the necessary repairs by 13 July 2017.
I turn to the question of compensation.
The correspondence demonstrates that Mr Walker never took direct responsibility for carrying out the repairs.
His first approach was to refer the repairs to his insurer. I have no evidence about his dealings with his insurer, save that on 13 October 2017 Mr Walker sent the applicants an email informing them that the repairs would not be covered under his policy. Meanwhile, the bathroom remained in need of repair. Whether the respondents could have claimed the cost of the repairs from their insurer, or not, is irrelevant. Clause 57 required the respondents to make the repairs within four weeks of being notified of the need for repairs. How they funded those repairs, and whether an insurer would pay for them, or reimburse the respondents for their payment of them, is irrelevant.
Mr Walker’s next approach, after being told that the repairs were not covered under his insurance policy, was to ask the applicants to find an appropriate company or person to make the repairs. It was an unusual approach. The property belonging to the respondents, and it was their responsibility to source repairers and arrange for the repairs to be done within the statutory four-week period. The applicants’ only obligation, under clause 82(1) of Schedule 1 to the RT Act, was to give access to the property upon the respondents giving the applicants “1 week notice … for the purpose of making or inspecting repairs”.
Nevertheless, the applicants provided this service to the respondents, no doubt because of their significant material interest in getting the bathroom repaired.
Even more unusual, upon the applicants providing this service to the respondents by finding a suitable repair person and obtaining a quote for an inspection report, the cost of which would have been deducted from the cost of the repair work, Mr Walker refused to accept the quote and asked them to continue their efforts to find a suitable repair person who would be prepared to quote for free. Meanwhile, the bathroom remained unusable, month after month.
Mr Walker appears not to have appreciated the most basic aspect of a residential contract: a lessor cannot take the tenant’s coin by way of payment of rent, and not provide the property for which the rent is paid.
On the evidence, repairs to the bathroom commenced sometime in December 2017 but were not completed until January 2018, noting that the invoice for the repairs was rendered on 15 January 2018. Mr Walker contends that the structural work was done in December 2017, and that all that remained was the painting. That is irrelevant. The bathroom remained unusable until the repairs were completed. In the case of a bathroom, painting with (I presume) some kind of anti-mould paint would have been essential before the bathroom was again usable.
A bathroom is a critical part of a habitable residential property. But for the ensuite bathroom and the bathroom in the detached building in the backyard of the premises, the property as a whole would have been uninhabitable.
The respondents knew that the property was let to the applicants and their adult children. A bathroom should be accessible and usable by any person living in premises at any hour, night or day.
For six months, including the whole of winter, the applicants’ options were the ensuite or going outside to and fro across the back garden to use an external bathroom. The inconvenience was so significant that the applicants cancelled a proposed visit from relatives in New Zealand.
In Koesmarno v Mutis[7] the Appeal Tribunal said:
The original tribunal found that the tenant made reasonable attempts to bring the issue of mould to the agent’s attention, and that the agent and lessor did little to mitigate the issue, and that the mould assessment report suggested that the mould was caused by the lessor’s failure to conduct timely repairs. This Tribunal agrees that the lessor has breached his obligations to maintain the premises in a reasonable state of repair (clause 55(1)), and make repairs within four weeks of being notified of the need for the repairs to the plumbing and roof (clause 57), and that these problems had an impact on the mould. Mr Mutis is entitled to damages for this breach.
The original tribunal made an award of $2,500 in compensation to the tenant. (paragraphs [29] – [32]). Counsel for the tenant argued that this should be increased to $5,000, on the basis of a range of comparative cases, or even as much as $20,000. In Libner and Armour v McBride (2010) NSWCTTT 166 a rent reduction of $70 per week was made for extensive mould infestation which reduced the tenant’s use and was not resolved for the whole tenancy. It was argued this would equate to $14,000 in this case. In Vitkind v NSW Land and Housing Corporation (2010) NSWCTTT 107 an amount of $2,500 was awarded for six years of mould problems. (footnotes omitted)
[7] Koesmarno v Mutis [2015] ACAT 89 at [53]-[54]
On appeal, the Tribunal concluded “that [the] decision of the original tribunal was within this range, reasonable in the circumstances and does not reveal any error.”[8]
[8] Koesmarno v Mutis [2016] ACAT 126 at [55]
In Timms & Simpson v Adams[9] the NSWCTTT ordered the lessor to pay compensation for a main bathroom that “was unable to properly used” as a result of mould. The Tribunal ordered compensation of $50 per week, but that was the amount that the tenants claimed. Also, that sum represented one sixth of the weekly rent ($300 per week) and was in addition to $100 per week for mould in the ensuite bathroom, lounge and nursery.
[9] Timms & Simpson v Adams [2012] NSWCTTT 53
Mr Walker relied on the Tribunal’s recent decision in Halcombe v Hitchman[10] in which the Tribunal awarded the tenant five percent of the rent paid as compensation for the loss of the use of the spa in the main bathroom. The Tribunal accepted that the spa was “attractive for him”. I find the quantum of compensation awarded in Halcombe v Hitchman of little relevance to this case. An inability to use an entire main bathroom because of a reasonably held belief that it represented a health risk is a loss of much greater significance than the use of a spa.
[10] Halcombe v Hitchman [2018] ACAT 5 at [74]
In my view the sum claimed by the applicants is reasonable. In circumstances where the applicants are liable to pay the rent through to 18 January 2018, there should be compensation for the defect that continued after they had vacated the property. I allow $100 per week for the period 13 July 2017 to 18 January 2018, being 27 weeks, to a total of $2,700.
Bathroom renovation
Where I am not persuaded that the bathroom renovations were caused by the applicants’ failure to ventilate, I disallow the claim.
Additional cleaning
The respondents claim for “end of lease cleaning” ($450), “Windows” ($300) and “carpets steam cleaned 4 areas” ($180) plus GST to a total of $1,023. They rely on a tax invoice from Cleaning Wiz dated 18 February 2018.
The applicants deny the claim and rely upon photographs taken on 7 January 2018 which evidence a high standard of cleanliness of the property as at that date including the use of a professional grade carpet cleaner. They engaged a company, Intense Cleaning, who carried out ‘end of lease cleaning’ excepting the kitchen and (presumably) the main bathroom for a cost of $480.
On the evidence, I am not persuaded that the applicants did not leave the premises “in substantially the same state of cleanliness” as it was at the commencement of the lease, contrary to clause 64(a) of schedule to the RT Act. First, the applicants vacated the property on 24 December 2017, approximately two months prior to the cleaning undertaken by Cleaning Wiz. During that period, the respondents had possession of the property. Second, the applicants’ photographs taken on 7 January 2018 show a reasonable state of cleanliness. Third, by February 2018, the respondents had engaged a professional agent to manage the property for further rental, a necessary component of which was to present the property for rent with a high standard of cleanliness as at the date of commencement of the new lease irrespective of its condition in December 2017. I disallow the claim.
Carpet replacement
The respondents claim $400 as an estimated cost to replace damaged carpet. The damage was a stain from spilt make-up. There is no suggestion that the respondents replaced the carpet as a consequence. Mr Walker said, and I accept, that the carpet was new when the tenancy commenced although it was not clear whether he was referring to the subject tenancy or the prior tenancy when the applicants first commenced their occupation of the premises.
The applicants accepted fault, but in my view it was minor. Spillages of this kind, whilst not excusable and not within the ambit of fair wear and tear, are a common occurrence in residential properties. In Tankard v Ogbonna[11] I considered carpet damaged by spilt make-up and awarded compensation of 10 per cent of the cost of the replaced carpet. In this case, doing the best I can, I allow $40.
Bathroom repairs
[11] Tankard and Anor v Ogbonna and Anor [2017] ACAT 72 at [13] – [16]
The respondents claim $800 for the cost of replacing the vanity unit in the main bathroom that was covered in mould, fixing a towel rack, replacing the mouldy blind, re-hanging a replacement bathroom door and re-painting. Mr Walker provided by way of evidence a tax invoice dated 15 February 2018 from his brother which included the cost of “materials” for $861.70.
Where all of this work appears to be attributable, wholly or in part, to the mould and general deterioration of the bathroom none of which I am persuaded was caused by negligence or a wilful act by the applicants, I disallow the claim.
Maintenance and gardening
The respondents claim $407 for general maintenance and gardening, including replacement of 15 light globes, minor repairs to front blinds, mowing and whipper snipping the backyard and removing leaves and debris from the front and rear gardens. They rely on a tax invoice from In Line Maintenance dated 16 March 2018 directed to the respondents’ new property manager.
Again, I am not persuaded that the applicants are liable for this maintenance and gardening. They vacated the property more than two months earlier. Save perhaps for some light globes that might have been blown prior to 24 December 2017, all of the maintenance was necessary to address fair wear and tear (for which the applicants would not be liable) or to bring the property to a standard ready for rental following a lengthy vacancy. I disallow the claim.
Curtain cleaning
The respondents claimed $299 for cleaning mould on the main bedroom curtains. The claim is unusual. Bedroom mould is sometimes the basis for a claim made by a tenant against a lessor, but has never to my knowledge been the basis of a claim by a lessor. Where there is no basis to surmise, or evidence to support, that the mould occurred because of negligence or a wilful act by the applicants I disallow the claim.
Deck repairs
The respondents claim $250 for the cost of removing motorbike tyre marks on the rear deck of the property. As best I can tell, the deck was well worn over time as a result of natural weathering, and Mr Luke Walker states that he re-varnished both decks, but that does not excuse the applicants’ conduct.
The applicants acknowledge fault, but submitted that the damage is minor. I am unable to discern the tyre marks from the photograph produced in evidence and so am unable to ascertain the extent of the damage. I can only conclude that it is minor. I also have no basis to assess the reasonableness of the respondents’ claim, in terms of time spent or cleaning agents used. Doing the best I can, where damage appears to be minor, I allow $50.
Replace broken smoke alarms
The respondents claim $99 for a replacement smoke alarm in the outside room. They rely upon a maintenance request made on 8 March 2018, updated on 6 April 2018, from the new property manager.
The applicants deny the claim, and submitted that the smoke alarm “just fell down”. They also submitted that its value was negligible, and that the replacement cost was primarily the labour cost for someone to attend and install a new alarm.
I am not persuaded that the applicant should be liable for a smoke alarm that was replaced more than two months after the applicants vacated the property, and where there is no evidence to establish why it broke. In particular, there is no evidence to support Mr Walker’s claim that the alarm was “disarmed and pulled down” and the applicants deny doing so. I disallow the claim.
Damaged main bedroom wardrobe door
The respondents claim $150, by way of estimate, for damage to the main bedroom wardrobe door. In support, they provide a photograph evidencing a ‘punched in’ circular area.
The applicants acknowledge fault, explaining that the door swung round and hit a cylindrical object.
I have no evidence regarding the basis for the respondents’ claim, or the cost of repair or whether it has been repaired. Nevertheless, it is self-evident that it occurred from a lack of care. I allow $100.
Missing studio dome light cover
The property included an external studio room, furnished with an overhead fan and a light at the centre of the fan. The light bulb was covered with a glass shade. Ms McEachern explained that at some point the glass shade fell off and broke. The respondents claim for the cost of the replacement shade. Mr Walker estimates the cost of the replacement at $50, but does not provide any evidence in support.
The applicants are liable under clause 63(a) and (c) of Schedule 1 for any damage that they intentionally or negligently cause, and must take reasonable care of the premises and the contents but there is no evidence or suggestion that the light cover became detached and fell because of any action on the applicants’ part. Where there is no evidence as to why the applicants are liable for the cost of the dome or why it fell down, and where the onus of proof is with the respondents, I disallow the claim.
Studio water damage to flooring
Mr Walker contended that the floor in the external studio was damaged by water. The respondents claim $100 as compensation for the damage. They rely on a witness statement from Mr Walker’s brother, Mr Luke Walker, who states that on 5 and 7 February 2018 he made a number of repairs but did not have time to fix the flooring in the studio “which had clearly been affected by water”.
The applicants dispute the claim, and say they did not cause the damage.
There are many difficulties with the claim. There is no evidence regarding the cause of the damage, in particular why it was caused by the applicants’ failure to take reasonable care of the premises. It might have been caused by a leak. There is no evidence regarding the nature or extent of the damage, whether it has been repaired or whether it was caused by fair wear and tear. There is no evidence to quantify why the respondents claim $100. Where the onus is on the respondents to prove, and I am not persuaded that they have done so, I disallow the claim.
Replacement bathroom blind
Mr Walker explained that the bathroom blind needed to be replaced because of mould damage. Mr Cope described it as a plastic venetian blind of little value.
Mr Walker estimated the cost of a replacement blind at $150. Where the blind was damaged because of mould and I have found that the applicants were not responsible for the mould, I disallow the claim.
Carport cleaning
The respondents make a claim of $250 for the estimated cost of cleaning oil stains from the concrete surface under the carport. The respondents provided photographs showing the stains. Ms McEachern acknowledged that she spilt a bottle of oil, but says she cleaned it up as best she could. Having considered the photographs showing the stain and the generally worn and weathered condition of the concrete, I regard the damage to be minor in the context of a carport.
Mr Luke Walker stated that he did not have time to attend to the oil stain. Common sense suggests that the stains could be removed to a significant degree using a scrubbing brush and grease cleaner. Doing the best I can, I allow $30.
Tip fees
Mr Walker stated that the respondents incurred tip fees of $30 for disposing of renovation waste, particularly the replaced bathroom vanity unit. Where I have found the applicants are not liable for the costs of the bathroom renovation it follows that they are not liable for the tip fees associated with that renovation. I disallow the claim.
Water consumption
The respondents claim for the water consumption in the period 12 December 2017 to 14 March 2018. Although the applicants moved out of the property on 24 December 2017, the property was not re-let until 26 March 2018. The respondents used some water for cleaning and other purposes in the period 18 January and 26 March 2018 but that consumption would have been incidental. The respondents provided a water account stating that the water consumption charge in applicable period was $34.44. I allow the respondents’ claim.
Conclusion
I have determined that the applicants owe the respondents a total of $2,736.94. I have determined that the respondents owe the applicants a total of $2,800.00. The amount that the respondents owe the applicants exceeds the amount that the applicants owe the respondents by $63.06. Where quantification of the parties’ respective claims is necessarily subjective to some degree, and where this case has generated significant acrimony between the parties to the point where any further dealing between them should be avoided if possible, I will make no order regarding compensation. I shall only order that the bond moneys in dispute be returned to the applicants.
………………………………..
Presidential Member G McCarthy
HEARING DETAILS
FILE NUMBER: | RT 1067/2017 & RT 335/2018 |
PARTIES, APPLICANT: | Timothy Cope and Andrea McEachern |
PARTIES, RESPONDENT: | Crispin Walker and Yvette Walker |
COUNSEL APPEARING, APPLICANT | N/A |
COUNSEL APPEARING FOR RESPONDENT | N/A |
SOLICITORS FOR APPLICANT | N/A |
SOLICITORS FOR RESPONDENT | N/A |
TRIBUNAL MEMBERS: | Presidential Member G McCarthy |
DATE OF HEARING: | 19 April 2018 |
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