Director of Housing v Parsons - [2019] TASFC 3

[2019] TASFC 3

COURT: SUPREME COURT OF TASMANIA (FULL COURT)

CITATION: Director of Housing v Parsons [2019] TASFC 3

PARTIES:  DIRECTOR OF HOUSING
  v
  PARSONS, Gregory William

FILE NO: 3382/2018
JUDGMENT

APPEALED FROM: Parsons v Director of Housing [2018] TASSC 62

DELIVERED ON:  4 June 2019
DELIVERED AT:  Hobart
HEARING DATE:  27 May 2019
JUDGMENT OF:  Blow CJ, Estcourt J and Martin AJ

CATCHWORDS:

Landlord and Tenant – Residential tenancies legislation – Recovery of possession – Generally – Application for order for vacant possession – Requirement that magistrate be satisfied that reason for serving notice to vacate was genuine or just.

Residential Tenancy Act 1997 (Tas), s 45(3)(b).
Logan v Director of Housing [2004] TASSC 153, 13 Tas R 324, distinguished.
Aust Dig Landlord and Tenant [217]

REPRESENTATION:

Counsel:
             Appellant:  M E O'Farrell SC
             Respondent:  R Merkel QC and M Norton
Solicitors:
             Appellant:  Solicitor-General
             Respondent:  Benedict Bartl

Judgment Number: [2019] TASFC 3
Number of paragraphs: 78

Serial No 3/2019
File No 3382/2018

DIRECTOR OF HOUSING v GREGORY WILLIAM PARSONS

REASONS FOR JUDGMENT FULL COURT

BLOW CJ
ESTCOURT J
MARTIN AJ
4 June 2019

Order of the Court

Appeal dismissed

Serial No 3/2019
File No 3382/2018

DIRECTOR OF HOUSING v GREGORY WILLIAM PARSONS

REASONS FOR JUDGMENT FULL COURT

BLOW CJ
4 June 2019

I agree that this appeal should be dismissed, for the reasons stated by Estcourt J. There is a little that I would like to add.
The Director of Housing served on his tenant a notice to vacate his home, and applied to the Magistrates Court for an order for vacant possession. The magistrate was therefore obliged by s 45(3)(b) of the Residential Tenancy Act 1997 ("the Act") to determine whether "the reason for serving the notice to vacate was genuine or just". The reason specified in the notice was that the relevant residential tenancy agreement was due to expire not more than 60 days after service of the notice. The material before the learned magistrate at the hearing included an affidavit sworn by the tenant in which he suggested that the true reason for the service of the notice was that agents of the Director believed that the tenant had one or two other men living with him, and that reliance on the expiry of his lease deprived him of any opportunity to remedy any asserted breach or to avail himself of a right of review. In substance, that document raised suggestions to the effect that the stated reason for serving the notice to vacate was neither genuine nor just. No evidence was provided to the learned magistrate on behalf of the Director as to the genuineness or justice of the stated reason for the serving of the notice.
Because the proceeding before the learned magistrate constituted a minor civil claim, it was appropriate for the magistrate to enquire as to the relevant facts in accordance with s 31AB(1)(b) and (c) of the Magistrates Court (Civil Division) Act 1992. However he made no such enquiries, and failed to undertake the evaluative task necessary to determine whether the stated reason for serving the notice was genuine or just.
At the hearing of this appeal, counsel for both parties made submissions about my decision in Logan v Director of Housing [2004] TASSC 153, 13 Tas R 324. In that case the Director had served a notice to vacate relying on a tenant's failure to pay rent. On the hearing of an application in the Magistrates Court for an order for vacant possession, a magistrate refused to let the tenant present evidence as to the condition of the premises. The tenant contended that he had been denied natural justice. I held, at [20], that the evidence as to the condition of the premises was irrelevant. I did so on the basis that the Act contained a code governing the recovery of possession of premises, and that express provisions in the Act made it clear that any breach of a landlord's obligations as to the condition of residential premises was irrelevant to the remedies available to a landlord in relation to the non-payment of rent. The contentions of the parties in that case did not raise for determination any question as to whether s 45(3), when it says that the Magistrates Court "may" order that vacant possession be delivered to the owner, confers any sort of discretion to grant or refuse relief.

File No 3382/2018

DIRECTOR OF HOUSING v GREGORY PARSONS

REASONS FOR JUDGMENT FULL COURT

ESTCOURT J
4 June 2019

Background

Gregory Parsons is an intellectually impaired man who has been in receipt of a disability support pension for 40 years. For almost 12 years he has been a tenant of the Director of Housing (the Director), since 27 June 2007. Mr Parsons' lease has been extended 14 times since the first tenancy period of three months was due to expire on 27 September 2007.
The most recent extension of the lease was on 2 November 2016, extending Mr Parson's tenancy to 27 June 2017. However, on 4 May 2017 a notice requiring him to vacate the unit was served on him on behalf of the Director. Upon enquiry of the organisation that manages housing for the Director, known as Housing Tasmania, the reason for the service of the notice given to Mr Parsons was, in effect, the same as that set out in the notice, namely, "your residential tenancy agreement is due to expire on 27 June 2017. The residential tenancy agreement will not be extended or renewed".
No other reason was given to Mr Parsons as to why he had to leave his home, notwithstanding that his lease had similarly almost come to an end 14 times before, over a period of 10 years, and notwithstanding that compliance with the notice would have left him homeless.
Facing homelessness, Mr Parsons did not comply with the notice. As a result the Director applied to a magistrate for an order for possession of the unit. The magistrate, Mr C P Webster, made that order. The question in this appeal is whether in so doing, the magistrate correctly exercised his jurisdiction and afforded Mr Parsons natural justice.
The learned primary judge in this Court, Geason J, on the hearing of an appeal by Mr Parsons against the magistrate's order, determined that the magistrate had constructively failed to exercise his jurisdiction and in failing to entertain submissions directed to the elements of the relevant legislative provision had denied Mr Parsons natural justice: Parsons v Director of Housing [2018] TASSC 62. His Honour found that the magistrate had not properly considered whether he was satisfied that the reason for service of the notice to vacate on Mr Parsons was "genuine or just" as required by s 45(3)(b) of the Residential Tenancy Act 1997 ("the Act").
The Director has appealed to this Court against the learned primary judge's order remitting the application for an order for possession back to the same magistrate to be dealt with according to law.

The magistrate's decision

By s 45(3) of the Act it is provided that:
"(3) The Court may order that vacant possession be delivered to the owner if satisfied that —
(a)   a notice to vacate the premises was properly given; and
(b)   the reason for serving the notice to vacate was genuine or just; and
(c)   vacant possession was not delivered to the owner; and
(ca) where the premises are social housing and the reason for serving the notice is a reason referred to in section 42(1)(da), (db) or (dc), vacating the premises would not result in unreasonable financial disadvantage, or unreasonable social disadvantage, to the tenant; and
(d)   the tenant was served with a copy of the application." (Emphasis added.)
Section 44 of the Act sets out the matters that must be stated in the notice, including, s 44(e) "details of the reason for which the notice is served". The reason required to be given by s 44(e) is a reference to the reason relied upon by the owner under s 42 for giving the notice to vacate. In giving the notice to vacate in this case, the Director had not relied on any of the reasons referred to in s 42(1)(da), (db) or (dc) of the Act. He relied only on the reason contained s 42(1)(d).
By s 42 of the Act it is provided that:
"42 Notice to vacate by owner
(1)   An owner of residential premises, including but not limited to social housing, may serve on a tenant of the premises a notice requiring the tenant to deliver vacant possession of the premises to the owner for any of the following reasons:
(a)that the tenant has failed to comply with any provision of the residential tenancy agreement;
(b)where the residential tenancy agreement is not for a fixed period, that —
(i)     the premises are to be sold or transferred to another person; or
(ii)     the premises are to be used for a purpose other than as residential premises for rental; or
(iii)    significant renovations are to be performed in respect of the premises; or
(iv)    the premises are to be used as a residence by a member of the family of the owner;
(c)…
(d)that a residential tenancy agreement is due to expire not more than 60 days after service of the notice;
(da)that, where the residential tenancy agreement relates to social housing —
(i)     the income, from the prescribed sources, of the tenant (or, if the tenant is a member of a household, of all members of the household), for a continuous 12-month period, beginning not more than 18 months before the notice is given, is more than the prescribed amount; or
(ii)     the value, in the 30 days before the notice is given, of the assets of the prescribed type, of the tenant (or, if the tenant is a member of a household, of all members of the household), is more than the prescribed amount, after there is deducted from the prescribed amount the total amount of all debts and liabilities of the tenant (or, if the tenant is a member of the household, of all the members of the household);
(db)that, where the residential tenancy agreement relates to social housing —
(i)     the premises contain 4 or more bedrooms, the tenants do not reasonably require all of the bedrooms in the premises and alternative premises have been offered to the tenant by the owner; or
(ii)     the premises have a special facility, or modification, suitable for a person with a disability or special requirements, the tenant does not require such a facility or modification and alternative premises have been offered to the tenant by the owner;
(dc)that, where the residential tenancy agreement relates to social housing, the tenant has, without the approval of the social housing provider, for a continuous period of more than 8 weeks not occupied the premises;
(dd)that, where the residential tenancy agreement relates to social housing provided by a social housing provider who leases the premises from the Director of Housing – the lease of the premises from the Director of Housing has expired or is to expire, or has been, or is to be, terminated by the Director of Housing;
(e)that an order has been made under section 86 of the Land Titles Act 1980 for foreclosure of the premises;
(f)that the premises are to be sold pursuant to section 78 of the Land Titles Act 1980 ;
(g)that the tenant has caused nuisance at the premises that is substantial.
(1A) For the purposes of subsection (1)(b), significant renovations are to be performed in respect of premises if —
(a)the premises would be unfit for occupation while the renovations are taking place; or
(b)were the premises to remain occupied by a tenant during the renovations, there would be a risk to the health or safety of any tenant, any visitors or any person carrying out the renovations.
(1B) The regulations may prescribe for the purposes of subsection (1)(db)(i) the circumstances in which tenants do not reasonably require all of the bedrooms in premises.
(2)     A notice to vacate is not required if —
(a)the tenant has abandoned the residential premises; or
(b)an application under section 41 is made for an order of termination.
(3)     Any payment of rent after a notice to vacate takes effect does not constitute the existence of a new residential tenancy agreement.
(4)     In subsection (1)(b)(iv) and subsection (5) , a reference to an owner in relation to a member of the family of the owner does not include a reference to a person who is an owner by virtue of paragraph (c) of the definition of owner in section 3(1).
(5)     In this section —
member of the family of an owner means —
(a)the owner's domestic partner, son, daughter or parent; or
(b)a parent of the owner's domestic partner; or
(c)another person who normally lives with the owner and is wholly or substantially dependent on the owner.
(6)     In this section, a tenant is a member of a household if the person is one of 2 or more persons, whether or not the person is related to any of the other persons, who —
(a) occupy the same residential premises; and
(b) contribute money for the purchase of food to be consumed at the premises or for the payment of amounts (apart from rent) owed for the provision of goods or services to the premises." (Emphasis added.)
It has always been, and remains, common ground between the parties that the requirements of s 45(3)(a) and (d) had been met, and that s 45(3)(c) was engaged. The only question for the magistrate's consideration was whether s 45(3)(b) was satisfied. That is to say, whether the magistrate satisfied himself that the Director's reason for serving the notice to vacate on Mr Parsons was "genuine or just". Or put in another way, whether he held the particular state of mind which s 45(3)(b) made a pre-condition to the performance of the exercise of the power reposed in him to order the delivery of vacant possession.
Before the magistrate there was an affidavit sworn by Mr Parsons on 5 October 2017 which then counsel for Mr Parsons sought to "tender". Then counsel for the Director objected to that course and the magistrate said:
"Oh well that's – let's just allow it in and I'll attach whatever weight I want to it. I think it's pretty clear that most of it is not Mr Parsons' … It's more legal submissions than anything."
Counsel for the Director then made some further submissions and the magistrate said:
"Well as I said – look, there's a lot of problems with it but let's just allow it in and I'll attach whatever weight to it I think appropriate, which in some cases isn't much."
I assume that the magistrate was aware that what was before him was a "minor civil claim". The procedure for minor civil claims is set out in Div 4 of Pt 5 of the Magistrates Court (Civil Division) Act 1992. He should have known that he was not bound by the rules of evidence. Section 31AB(1)(a) and (b) of that Act permit the Court to elicit by enquiry from the parties and the witnesses, and by examination of evidentiary material produced to the Court, "the issues in dispute and the facts necessary to decide those issues". The magistrate could have enquired as to any matter that bore on the exercise of the evaluative task before him.
Whatever his understanding of that was, in view of his comments set out above, it is difficult, if not impossible, to know which parts, if any, of Mr Parsons' affidavit and the annexures to it, he had regard to. One paragraph of the affidavit in particular, par 12, went to the issue of satisfaction of the requirements of s 45(3)(b). That paragraph reads:
"In my opinion, Housing Tasmania's reliance on lease expiration as the reason for my eviction was an excuse to hide behind so that they did not have to provide me with an opportunity to remedy the breach nor to provide me with a right of review."
That opinion was expanded upon and detailed by Mr Parsons in later paragraphs of his affidavit where he deposed that after he and his lawyer had received his file from Housing Tasmania, pursuant to a request made under the Right to Information Act 2009 (Tas), he believed that the Director was evicting him because of a suspicion that he was in breach of his lease by having other people living with him in his unit. He annexed documents to his affidavit from his Housing Tasmania file in support of that belief.
Mr Parsons deposed in pars 25 and 26 of his affidavit that if "Housing Tasmania" had served him with a notice to vacate on the ground that he was in breach of his lease because he had others living with him, then he would have been entitled to an opportunity to remedy the breach and/or to an opportunity to seek a review of the decision to serve the notice.
No evidence was adduced by the Director. Counsel for the Director before the magistrate relied on the documents attached to the Director's application, which included 14 documents entitled "Agreement to extend Lease term" and a document entitled "Notice to Vacate".
The Director's counsel submitted that the notice to vacate had been issued for a "genuine reason". However she did not elucidate. It was implicit in her submissions generally, however, that nothing more was required to satisfy the magistrate of the requirements of s 45(3)(b) of the Act than a correct statement in the notice that the tenancy agreement was due to expire on 27 June 2017, being a date not more than 60 days after service of the notice as specified in s 42(1)(d).
The magistrate gave his decision ex tempore. In doing so he said:
"It's been put to me on behalf of the tenant that there's an underlying reason behind the notice to vacate other than the simple fact that the residential tenancy agreement is about to expire, and due to the fact there's social housing, in particular housing with the Department of Housing, that I'm given some discretion to go behind the notice to vacate and find that reason and give – find the other reasons and give the tenants a right to meet those objections. It appears to me that that's not the case. That the – where a tenancy is about to expire any landlord, including the Department of Housing, is entitled to terminate the lease with the proper notice".
The magistrate then said:
"With respect I agree with his Honour the now Chief Justice in the decision of Logan and the Department of Housing, and that provided the formalities and the procedure has (sic) correctly been followed I do not have any discretion not to order vacant possession when the landlord has a prima facie right to terminate the lease, and the same applies to the Department of Housing".
I observe that from the two passages of the magistrate's reasons that I have just set out, it appears that he was conflating a perceived submission that the word "may" in s 45(3) of the Act, namely, that the court may order that vacant possession be delivered to the owner if satisfied of the relevant matters that follow those words, provided an overarching discretion not to make the order, with the submission that was actually being urged on him, namely that s 45(3)(b) required him to be satisfied that the reason given by the Director for the serving of the notice was "genuine or just".
I also note that the magistrate does not appear to have given any separate consideration to that latter submission, or even to the meaning and effect of the words of s 45(3)(b). Indeed the closest he came to considering the matter at all was in the following exchange with counsel for Mr Parsons:
"HIS HONOUR: Well – sorry, where's the discretion?
MR BARTL: You have the – you have the discretion to find that the reason for serving the notice to vacate was not genuine or just -…..
HIS HONOUR: Well you've said that, that's a big call, and if I had the discretion that would get you in, but where's the discretion?".
…
MR BARTL: Well, section 45(3)(b) says that an owner may apply to the court for delivery of vacate possession if a notice to vacate in respect of the premises has taken effect, we take no issue with that, and vacant possession has not been delivered to the owner-…..
HIS HONOUR: Yes.
MR BARTL: And then section – subsection (3) goes on to say, the court may order that vacate possession be delivered if satisfied that (b) the reason for serving the notice to vacate was genuine or just. Given my client's …
HIS HONOUR: Yes, genuine or just in this case is that that tenancy is vacated." (Emphasis added.)

I infer from those passages of the transcript of the hearing before him that the magistrate had, in line with the apparent submission of counsel for the Director, formed the view that if there was a correct statement in the notice to vacate that the tenancy agreement was due to expire not more than 60 days after service of the notice, as specified in s 42(1)(d) of the Act, then ipso facto the reason so stated was genuine or just and nothing more was required to satisfy him of the requirements of s 45(3)(b). That view seems to be reflected in the passages taken from his reasons for decision that I have set out above.

The reasons below

The Director conceded before the learned primary judge that if the magistrate had misconstrued s 45(3)(b) of the Act, then he would have exceeded his jurisdiction within the meaning of s 28(2)(a)(i) of the Magistrates Court (Civil Division) Act thus entitling Mr Parsons appeal to this Court enabling the judge pursuant to s 28(3) of that Act to make any orders that he considered appropriate in the circumstances.
Section 28(2)(a)(ii) also gave a right of appeal if there had been a denial of natural justice in proceedings before a magistrate under that Act.
The crux of the learned primary judge's decision that the magistrate had erred is found at [29]-[32] of his Honour's reasons where he said:
"[29] In Wilkie v The Commonwealth [2017] HCA 40, the Court said at [98] that in respect of a provision which required that 'the Finance Minister be satisfied that there is an urgent need for expenditure …', the casting of that pre-condition by reference to the Finance Minister's 'satisfaction' invokes an 'established drafting technique' which has been 'used to make the holding of a particular state of mind by the repository a pre-condition to the performance of a duty or to the exercise of a power': Plaintiff M96A/2016 v Commonwealth [2017] HCA 16, 91 ALJR 579 at 588 [39]; Re Minister for Immigration and Multi-cultural Affairs; ex-parte applicant S20/2002 [2003] HCA 30 and Bankstown Municipal Council v Fripp (1919) 26 CLR 385.
[30][ Section 45(3) utilises the formula requiring the court's 'satisfaction'. It is the same 'established drafting technique' referred to in Wilkie (above). It requires the court to hold a particular state of mind as a prerequisite to the exercise of the power conferred by the section.
[31] The evaluation inherent in an enquiry of this nature has been recognised as involving an exercise of judicial discretion: Norbis v Norbis (1986) 161 CLR 513 at [518] to [519].
[32] The learned magistrate was required to evaluate the Director's reason for the notice in accordance with s 45(3) of the RTA. The matters relevant to that evaluation are those set out in pars (a)-(d), though in this case par (ca) was not engaged. The evaluative task required a consideration of the evidence to determine whether the Court was satisfied as to those matters, whereupon, if so satisfied, the court was empowered to act. The need for that evaluation was overlooked; the discretionary nature of the exercise, was not appreciated."
The learned primary judge held that there had been a constructive failure on the part of the magistrate to exercise his jurisdiction, and that his failure to do so amounted to a denial of natural justice. His Honour said at [38]-[41]:
"[38]     The situation falls squarely within the concept of a constructive failure as described by Kirby J in Coal and Allied v AIRC [2000] HCA 47, 203 CLR 194, where his Honour said this at [82]:
'[82]     Distinguishing cases where the officer or authority has simply made a factual or legal error in the course of reaching a decision from cases where that error is classified as a constructive failure to exercise jurisdiction is not at all easy. What is ordinarily involved in the latter is a misapprehension on the part of the decision-maker of the nature of the powers and functions which the decision-maker is called upon to exercise or of the essential conditions by reference to which that exercise must occur. The misapprehension must be such that, in truth, it can be said that a purported exercise is not a performance of the powers and functions entrusted to the decision-maker at all. It is a pretended or assumed discharge. But in the eye of the law, the powers and functions have never been lawfully performed.' [Footnote omitted.]
[39]     This resulted in the court failing to give the appellant a hearing of his substantive case of the sort to which he was entitled: Dranichnikov v Minister for Immigration and Multicultural Affairs [2003] HCA 26, 197 ALR 389 at [32]. The consequence of the misapprehension of the nature of the exercise, construed as having no discretionary character, was a failure to entertain submissions directed to the elements of s 45(3) (b). The court did not consider submissions which were inconsistent with its view of the power it was exercising. There was a constructive failure to exercise jurisdiction: NABE v Minister for Immigration and Multicultural and Indigenous Affairs (No 2) [2004] FCAFC 263, 144 FCR 1 at [55]; Dranichnikov (above) at [24] and [95].
[40]     That failure is a denial of natural justice; Minister for Immigration and Multicultural Affairs v Bhardwaj [2002] HCA 11, 209 CLR 597; Dranichnikov (above).
[41] For these reasons the appeal should succeed. This is not a case where the discretion was exercised incorrectly; it was not exercised at all. In those circumstances, his Honour has failed to exercise the jurisdiction conferred on him by s 45 of the RTA. I uphold ground 1 insofar as it asserts a constructive failure to exercise jurisdiction. For the same reasons I uphold ground 2. (Ground 1 went to jurisdictional error and ground 2 went to a denial of natural justice.)
The learned primary judge then said at [42]-[45]:
"[42] In terms of the appropriate dispositive orders, the respondent referred the Court to r 693(6) of the Supreme Court Rules 2000:
'An appeal is not to succeed merely on the ground of misdirection or the improper reception or rejection of evidence unless some substantial wrong or miscarriage has been occasioned by the misdirection, reception or rejection.'
[43] I consider that 'some substantial wrong or miscarriage' has been occasioned by misdirection, because it has resulted in an order to vacate, without the court having undertaken the exercise required by the Act. It is a 'substantial wrong or miscarriage' because it resulted in an order requiring the appellant to leave his home without the opportunity to have his case considered in accordance with the terms of the Act. A right to a hearing is a cornerstone of the process under s 45, and the RTA is prescriptive about the matters required to be considered and the process that involves. The consequences of the court's approach were serious. I do not accept the submission that the course taken has not resulted in a 'substantial wrong or miscarriage'.
[44] The respondent urged me to remit the matter. The appellant urges me to vacate the order, quash it and dismiss the application. In circumstances where a court has failed to undertake the exercise reposed in it, on the basis that it has misunderstood the obligation, the proper course is to remit the matter so that the magistrate can deal with the matter according to law. This is not a merits appeal. Such course affords appropriate respect to the court below and is consistent with the statutory regime the subject of the appeal. I do not think that any unfairness accrues to the appellant in those circumstances, assuming that to be a relevant consideration in the determination of the appropriate dispositive order.
[45] That is the order I will make. Before doing so I will say something more about s 45 of the RTA." (Emphasis added.)
I regard all that followed in his Honour's reasons after [45], concerning both the effect of the decision of Blow J (as he then was), in Logan v Director of Housing [2004] TASSC 153, 13 Tas R 324, and concerning the meaning of the words "may" and "genuine or just" in s 45(3)(b) of the Act, as obiter dicta in view of his Honour's finding, with which I agree, that the requirement to hold a particular state of mind called for by s 45(3)(b) was not addressed by the magistrate, resulting in a constructive failure by him to exercise his jurisdiction and consequently in a denial of natural justice to Mr Parsons.
I should however observe that I do not regard Logan as authority for the principle ascribed to it by the magistrate in the passage from his reasons that I have set out above, namely his statement:
"… that provided the formalities and the procedure has (sic) correctly been followed I do not have any discretion not to order vacant possession when the landlord has a prima facie right to terminate the lease …".
For present purposes the decision in Logan may be confined to the finding by Blow J that because in that case the rent was in arrears, it was open to the learned magistrate to hold that the reason for serving the notice to vacate was "genuine", and thus that s 45(3)(b) was satisfied. Genuineness of reason is not as self-evident however, where the stated reason for the notice to vacate is that an historically repeatedly renewed tenancy agreement is coming to an end. I add that his Honour did not consider the meaning of the words "genuine or just" and ought not to be taken, in my view, as espousing any view as to whether the word "or" is disjunctive or conjunctive.
Blow J did go on in that case however, to consider a submission made by counsel for the Director, namely, that when the requirements of s 45(3) of the Act are satisfied, a magistrate has no discretion not to order the delivery of vacant possession, despite the use of the word "may" in the opening words of that subsection. That is not the issue at hand in the present case and that question may be taken to have been settled by Logan in favour of the Director. No overarching discretion arises. But the anterior question of satisfaction of the matters specified in s 45(3)(b) does arise in this case, and in each and every case involving an application for vacant possession pursuant to s 45(3). And the decision in Logan does not preclude the word "may" from itself being discretional when read in conjunction with the word "satisfied" and the words "genuine or just".
I accept the submission made by counsel for Mr Parsons, Mr Merkel QC and Ms Norton, that Logan was concerned with whether the Act, which sets out a code for termination, could have imported into that code a discretion to refuse to order that vacant possession be given in reliance upon the equitable doctrine of relief against forfeiture. No such overarching discretion is contended for in the present case.

Grounds of appeal

Ground 1 of the notice of appeal by the Director to this Court asserts that:
"His Honour erred in fact in determining that the learned Magistrate had not considered whether, in respect of the Residential Tenancy Act 1997 (RTA), the reason for serving the Notice to Vacate was genuine or just, when on a proper consideration of the materials, the Magistrate had considered the reason for serving the Notice and was satisfied that s 45(3)(b) had been met."
To my mind counsel for the Director, Mr O'Farrell SC, appears to urge this ground of appeal on a circular argument that denies any purpose or meaning to s 45(3)(b). The crux of his argument, as I apprehend it, is that the magistrate made no error because he did in fact determine that he was satisfied that the provisions of s 45(3)(b) were met, namely that the reason for giving the notice was "genuine or just", because that was the reason for serving the notice to vacate that was set out in the document itself, and that that reason was one of the reasons set out in s 42(1) of the Act. If that were the case then there would be no need for s 45(3)(b), as that determination could be made on satisfaction of s 45(3)(a), namely that "a notice to vacate the premises was properly given". Section 45(5) provides a notice to vacate is "properly given" if the notice states the information required under s 44. That information is confined to the date of serving the notice; the name of the tenant; the name of the owner; the residential premises to which the notice relates; details of the reason for which the notice is served, and the date on which the notice takes effect.
In his written submissions he contends that once the focus is on the "legal basis" of the reason for the notice, other bases for which the notice might have been served become irrelevant. That is to say, that the question for the magistrate was whether there was a "genuine or just" reason for the notice to vacate, in the sense "that it was properly based upon settled principles". The settled legal principle referred to, as I apprehend the argument, is that "it is beyond doubt" that a notice to vacate can be served for the reason set out in s 42(1)(d) of the Act.
This contention is based on assertions in the written submissions that for the purpose of s 45(3)(b) of the Act, the level of satisfaction, however the phrase "genuine or just" is construed, is to be reached on "sufficient legal reasons, or upon application of settled legal principles", and that "the impending loss of the contractual right pending the expiry of the residential tenancy agreement", was a sufficient legal reason to give Mr Parsons the notice to vacate.
Counsel for the Director accepts that the learned primary judge correctly found that the requirement that a magistrate be satisfied of the criteria in s 45(3) has been used in the Act to make the holding of a particular state of mind by the repository a pre-condition to the performance of a duty or to the exercise of a power. However, he contends that it does not follow that to arrive at that particular state of mind a magistrate is required to perform an "evaluative task" in relation to Mr Parsons' circumstances, the circumstances of the tenancy, the history of it and his occupation of the premises.
The argument runs that the matters in s 45(3)(a), (c) and (d) of the Act are questions of objective fact. There is no evaluation, other than to determine whether the fact exists or not, and that the "evaluative task" posited by the learned primary judge would require a magistrate to look behind the ostensible reason of the owner to see if there was another reason for which the notice to vacate was given. Counsel for the Director contends that, on this analysis it would not matter that, "objectively", the owner had a legitimate reason to serve a notice to vacate arising from the terms of the residential tenancy agreement as the tenant would be entitled to contest an application under s 45(1) on the basis that the reason chosen by the owner was not the real reason.
Counsel for the Director submits that there is no call in s 45(3) of the Act for an evaluative task of this breadth. All that is necessary, he contends, is for the notice to vacate to be given for one of the reasons in s 42(1). He argues that this will involve a legitimate choice, to be made by an owner, of the reason for serving the notice to vacate, whereas the "evaluative task" posited by the learned primary judge would require, a magistrate to look behind the "ostensible" reason of the owner to see if there is another reason for which the notice to vacate is given. He laments that, on this analysis, it would not matter that, objectively, the owner had a legitimate reason to serve a notice to vacate arising from the terms of the residential tenancy agreement. The tenant would be entitled to contest an application for possession "on the basis that the reason chosen by the owner was not the real reason". (My emphasis.)
I am unable to accept any of these submissions. To my mind, that a tenant would be entitled to contest an application for possession on the basis that the reason chosen by the owner was not the real reason is precisely the purpose of the plain language of s 45(3)(b) of the Act. All the more so given that I accept the submission of counsel for Mr Parsons that although the Act applies to both private and social housing landlords, the relevant legislative context that arises when the Act applies to social housing must include the Director's functions, powers, and duties as a provider of social housing under the Homes Act 1935 (Tas).
I also accept the submissions of counsel for Mr Parsons that, as found by Blow J in Logan (above), the Act sets out a code for the termination of agreements, either by the giving of vacant possession, or by a court ordering vacant possession, and thus regulates the minimum content of residential tenancy agreements, including in relation to termination rights, and that ss 42-45 operate for the protection of tenants, not landlords.
And I accept their argument that the expiry of the period set out in the notice required under s 42(1) of the Act merely establishes a prima facie entitlement to terminate a tenancy agreement. Unless vacant possession is delivered by the tenant, the actual termination of the agreement by a notice validly given is subject to a magistrate being satisfied of the matters set out in s 45(3) and then, if so satisfied, exercising the power to make an order to vacate.
As they submit, absent those protections, there would be nothing to prevent a lease agreement from providing a landlord with a right to unilaterally terminate a tenancy and then evict a tenant for any reason justifying termination under the Act or the terms of the agreement.
In my view the learned primary judge correctly held at [30] of his reasons that Wilkie v The Commonwealth (above) was authority for the proposition that the magistrate was required to hold a particular state of mind as a prerequisite to the exercise of the power conferred on him by s 45(3) of the Act. That his Honour subsequently, at [31], referred to the "evaluation inherent in an enquiry of this nature" is not, in my view, to be taken as positing some wider "evaluative task" or impermissible overarching discretion, as seems to be suggested by counsel for the Director.
The magistrate was required to hold a state of mind that amounted to satisfaction that the reason given by the Director for giving the notice to vacate was genuine or just. In my view, that state of mind could not be achieved by reference only to the legal reason stated in the notice. That was what the magistrate purported to do, and as a result he constructively failed to exercise his jurisdiction as found by the learned primary judge, and in so doing denied Mr Parsons natural justice.
Counsel for the Director seeks to further his argument for the construction of s 45(3) contended for by reference to s 45(3)(ca) of the Act. He submits that the fact only one reason for the notice to vacate is required can be seen in the interaction between ss 42(1) and 45(3)(ca) in that for s 45(3)(ca) to be engaged, the relevant premises must be social housing, and the reason for the notice must be one of the reasons in s 42(1)(da), (db) or (dc). However, the argument runs, because of the use of the word "any" in the opening words of s 42(1) it is clear that the owner is not required to choose the relevant one of these provisions in all cases of social housing. Thus, counsel contends, despite a tenant in social housing no longer meeting a particular requirement of s 42(1)(da), (db) or (dc), the termination of the tenancy may be brought about by another reason, without resort to those provisions.
Moreover, counsel for the Director submits, if "an evaluative task" is required in cases in which the Director is the applicant, it is required for every owner who seeks the Court's assistance to obtain possession as the Act makes no distinction between them. Thus, the argument runs, if the learned primary judge's analysis is accepted, an owner of residential premises who wishes to eject a tenant for the reason that the tenant has committed a number of breaches of a residential tenancy agreement is not entitled to serve a notice to vacate for the impending expiration of the agreement, and the magistrate will not have jurisdiction to order that possession be delivered to the owner without hearing the tenant's case about the breaches, notwithstanding that the residential tenancy agreement has expired. He submits that "[i]n the face of a legitimate reason supplied by s 42(1) to serve the notice, those results are, with respect, absurd."

I do not find those arguments at all persuasive. There is no reason in theory why a notice to vacate could not be given for more than one of the reasons set out in s 42(1), and a magistrate would not be required to embark upon "hearing the tenant's case" about one or more of them if the magistrate was satisfied that at least one of them was "genuine or just".
I can find no error in the learned primary judge's reasoning or conclusion as asserted in ground 1 of the notice of appeal and, in my view, for the reasons I have given, that ground should fail.
Ground 2 of the notice of appeal asserts:
"His Honour erred in fact and in law in determining that there had been 'some substantial wrong or miscarriage' within the meaning of that phrase in Rule 693(6) of the Supreme Court Rules 2000, when upon a proper consideration of the materials, there had been no such wrong or miscarriage."
The Supreme Court Rules 2000, r 693(6) provides:
"An appeal is not to succeed merely on the ground of misdirection or the improper reception or rejection of evidence unless some substantial wrong or miscarriage has been occasioned by the misdirection, reception or rejection."
Counsel for the Director contends under this ground of appeal that if this Court finds that the magistrate misdirected himself in relation to s 45(3)(b) of the Act, then r 693(6) is directly engaged, because the misdirection could not have resulted in any different legal consequence.
This ground depends upon acceptance of the proposition that all s 45(3)(b) required the magistrate to consider was the stated reason for the notice to vacate and to determine whether there was a proper legal basis for it. As can be seen I do not accept that proposition.
Ground 2 should fail.
Ground 3 of the notice of appeal asserts:
"His Honour erred in fact and in law in determining that the learned Magistrate had constructively failed to exercise his jurisdiction when, upon the proper consideration of the materials, the learned magistrate had not so failed."
This ground also depends upon acceptance of the proposition that all s 45(3)(b) of the Act required the magistrate to consider was the stated reason for the notice to vacate and to determine whether there was a proper legal basis for it
Counsel for the Director contends that the learned primary judge "did not complete the task of construing s 45(3)", which contains the conditions precedent to enable a magistrate to make an order and that, had he done so, he ought to have been satisfied that the magistrate had not failed to exercise his jurisdiction to make the order.
The argument runs that, once it is accepted that the magistrate was only required to consider the expiry of the notice as the stated and legal reason for serving the notice to vacate, "there was no call for him to consider any other reason". Counsel for the Director argues that the case advanced for Mr Parsons depended on an irrelevant premise, and that had the magistrate accepted that he should take it into account, he would have fallen into error.
As I have said, I do not accept the basic premise underlying those submissions. I can find no error in the learned primary judge's reasons and conclusions as asserted by this ground.
Ground 3 should fail.
Ground 4 of the notice of appeal asserts:
"His Honour erred in law in construing the phrase 'genuine or just' in s 45 (3) (b) of the RTA in such a way that 'or' is conjunctive, when, upon its proper construction it does not have that meaning."
Counsel for the Director submits that the purpose of searching for the meaning of the phrase "genuine or just" in s 45(3)(b) of the Act is to identify the "legal standard" against which a reason under s 42(1) can be tested. That may be so, but, in my view, it is not necessary or appropriate for this Court to construe that phrase in this case. The magistrate did not seek to do so. The meaning of that phrase was not dispositive of the case before him. Whatever the phrase may mean, satisfaction as to it involves more than merely ascertaining that the reason given for the service of the notice to vacate is one of the reasons set out in s 42(1). That, in effect, is all that the magistrate did.
Counsel for Mr Parsons submit that on any proper construction, s 45(3)(b) required the magistrate to consider the reason for exercising the statutory entitlement to serve a notice to vacate and to then enquire whether reliance on that entitlement, that is, the reason relied upon for the purposes of ss 42 and 44(e) of the Act was "genuine or just". I agree.
They suggest three possible constructions in their written submissions.
The first is that a court cannot simply assume for the purposes of s 45(3)(b) of the Act that reliance on the particular entitlement to give the notice to vacate under s 42(1) is the only matter required to be considered under s 45(3)(b). The court must go a step further and determine whether it is satisfied that that reason is "genuine or just". On this approach it is argued that the phrase "genuine or just" is disjunctive. That is, that the court may decline to make an order to vacate because it is not satisfied that the reason relied upon for giving the notice to vacate was genuine, as it was not the reason why the owner really decided to rely on the entitlement to give the notice or, alternatively, because it is not satisfied that the reason relied upon is just.
The second is that the decision in Logan (above) does not prevent the word "may" in s 45(3) from being of facultative effect (as opposed to providing an overarching discretion), and that reading the word "may" in s 45(3) as being facultative, and not mandatory, is consistent with the notion that a court may refuse to make an order to vacate in circumstances where it is satisfied that the landlord's reason for serving a notice to vacate is genuine but not just.
The third is that if the word "may" means "must" and the phrase "genuine or just" is read disjunctively, then a court would be required, subject to being satisfied of the other preconditions in s 45(3), to make an order for possession in every case in which it was satisfied that the landlord's reason for giving a notice was genuine, even if it was unjust. Such a construction, it is submitted, gives the word "just" no purpose, and as such would be inconsistent with the legislative purpose of being fair to tenants and incompatible with the beneficial rule of statutory construction.
Thus, as noted, it is submitted by counsel for Mr Parsons that if any of the three construction arguments contended for is correct, it must follow that the magistrate erred in law, denied Mr Parsons procedural fairness, and constructively failed to exercise the jurisdiction conferred upon him under s 45 of the Act. I agree.
However, in my view the ratio decidendi of the learned primary judge's decision precedes, and culminates in, [41]–[44] of his Honour's reasons for judgment. The comments that follow after the announcement of the intended order in [45], concerning the construction to be given to the words "genuine or just" in s 45(3)(b) of the Act, are obiter dicta. His Honour appears to quite deliberately announce an intention to merely comment obiter in the second sentence of [45].
It follows that, in my view, ground 4 of the notice of appeal is not properly raised before this Court as a ground of appeal from a "judgment, order or determination" of the learned primary judge within the meaning of s 40 of the Supreme Court Civil Procedure Act 1932, and there is no cross-appeal in lieu of a notice of contention. The correct construction of the phrase "genuine or just" should await an occasion when the meaning of those words is dispositive of a particular case. This is not that case.
Ground 4 should fail.

Disposition

I would dismiss the appeal.

File No 3382/2018

DIRECTOR OF HOUSING v GREGORY PARSONS

REASONS FOR JUDGMENT FULL COURT

MARTIN AJ
4 June 2019

For the reasons given by Estcourt J I agree that the appeal should be dismissed.