Ericson v Elder & Anor (Residential Tenancies) - [2024] ACAT 20

ACT CIVIL & ADMINISTRATIVE TRIBUNAL

ERICSON v ELDER & ANOR (Residential Tenancies) [2024] ACAT 20

RT 443/2023

Catchwords: RESIDENTIAL TENANCIES – failure to make reasonable repairs – use of facilities and parts of the premises – not provided with key to access facilities – not able to use balcony while construction on neighbouring site – request for inspection – whether agent was intimidating or dishonest

Legislation cited: ACT Civil and Administrative Tribunal Act 2008 s 34
Residential Tenancies Act 1997 ss 71, 83

Cases cited:Briginshaw v Briginshaw [1938] HCA 34
Winter & Anor v Delacy [2023] ACAT 31
Young v Chief Executive Officer (Housing) [2023] HCA 31

Tribunal:Senior Member D Stewart

Date of Orders:  28 February 2024
Date of Reasons for Decision:      28 February 2024
AUSTRALIAN CAPITAL TERRITORY          )
CIVIL & ADMINISTRATIVE TRIBUNAL     )          RT 443/2023

BETWEEN:

MATTHEW ERICSON
Applicant

AND:

BRUCE ELDER
First Respondent

KIM ELDER
Second Respondent

TRIBUNAL:Senior Member D Stewart

DATE:28 February 2024

ORDER

The Tribunal orders that:

the respondents are to pay the applicant the sum of $2200, comprising of:
(a)$1500 in reduced rent for not having a building key which provided access to facilities including the bin and pool areas;
(b)$200 in compensation for a failure by the respondents to engage in reasonable repairs to the bedroom window seal; and
(c)$500 in reduced rent for loss of use of the balcony.
the respondents are to make reasonable efforts to repair the seal at the bottom of the bedroom window with the same or similar material as used at the top of the window within 28 days.

………………………………..
Senior Member D Stewart

REASONS FOR DECISION

Introduction

Mr Ericson (applicant or tenant) is the tenant of a unit in Braddon, ACT under a residential tenancy agreement with the lessors, Bruce and Kim Elder (respondents or lessors). The tenant has applied for orders for compensation under section 83 of the Residential Tenancies Act 1997, including compensation for alleged breach by the lessors of their obligation to make reasonable repairs and to not interfere with the reasonable peace, comfort or privacy of the tenant in the use of the premises. He also claims a reduction in rent under section 71 for not being able to use various facilities or part of the premises.
In his application of 2 May 2023, the tenant sought final and interim orders relating to the frequency and reliability of inspections of the property by the lessors' agent, not having access to a key to various parts of the building, including the rubbish bins and pool, the failure to repair a broken window seal, faulty oven and cooktop, and reduced amenity due to the construction of the neighbouring Haig Park Community Centre. Interim orders were also sought for facilitation of an independent dispute resolution process. A preliminary conference was held on 5 June 2023 and adjourned to 5 July 2023. An interim application for orders in relation to material provided by the agent for the respondents in response to a subpoena issued by the tenant was dismissed on 1 September 2023. A final hearing into this matter was held on 20 November 2023.
In his submission for the final hearing, filed with the Tribunal on 15 September 2023, the tenant no longer sought orders in relation to the faulty oven and cooktop. He added a claim for compensation for the lessors' failure to disclose an additional rental payment fee prior to the tenant selecting the payment method, and raised issues with servicing of the air-conditioning unit. The tenant also sought various orders relating to what he described as a “contempt of the tribunal”[1] and intimidation and dishonesty by the agent for the lessors. Each of the matters for which orders were sought is discussed below in the order set out in the tenant's submissions.
[1] Submissions of the applicant dated 15 September 2023 at [28]
At the commencement of the hearing, the tenant raised the issue of compensation for distress and disappointment as provided for in the case of Young v Chief Executive Officer (Housing)[2] (Young) which had been handed down on 1 November 2023 and which the tenant had heard discussed on the radio shortly before the hearing. In Young, the High Court held that distress and disappointment that was not consequential to any physical inconvenience could be the basis for compensation for breach of a term implied by legislation into a residential tenancy agreement. In that case, the landlord failed to take reasonable steps to provide security devices such as a back door. The majority held:
the task of the Tribunal ... is to arrive at a measure of compensation which conforms to the purposes of the Act and to the justice and equity of the case, having regard to the nature and purpose of the particular obligation with which there has been failure to comply and taking into account each of the mandatory considerations specified in [the applicable legislation][3]
[2] [2023] HCA 31
[3] Young v Chief Executive Officer (Housing) [2023] HCA 31 at [25]
It has been accepted by previous decisions of this Tribunal[4] that compensation can be available for non-economic loss associated with emotional distress and disappointment arising from a breach of a residential tenancy agreement including a failure to conduct repairs and interference with the reasonable peace, comfort or privacy of the tenant.
[4] For some examples see Winter & Anor v Delacy [2023] ACAT 31 at [63]-[66]
Much of the distress and disappointment claimed by the tenant in this case arose from the physical inconvenience of lacking access to facilities or needing to engage in additional cleaning. Whether there should be additional compensation due to any distress and disappointment independent of any physical inconvenience is considered below.

Building key

A particular key, referred to by the tenant as the building key (and by the lessors as the bin key) is required to access various common areas of the building, including the rubbish bin area, back gate, pool and stairs to the car park. The tenant claims he never received a copy of the building key. He first informed the lessors’ agent that the building key was missing in an email on 12 April 2021, shortly after commencing the tenancy on 24 March 2021. This was reiterated on 17 May 2021. On 18 May 2021, the lessors' agent responded by suggesting that the previous tenant had been able to access the rubbish bin door using the keys provided.
On 29 June 2021, the tenant asked the lessors' agent carrying out an inspection of the property to accompany him to the car park. The tenant gave evidence that this was intended to demonstrate to the agent that he did not have a building key, assuming that she would have one. The tenant acknowledged that the lessors' agent was visibly distressed by what he claimed was the prospect of being locked in the confined area until she was able to locate a key (which he assumed was for another unit in the building). The respondents gave evidence that the agent reported the tenant had indicated at the time that he had a key, but the agent was uncomfortable and wanted to leave without waiting for him to unlock the door.
On 7 July 2021, the lessors' agent emailed that they had checked with the strata managers and there had been no changes to the door to access the bins. The tenant replied to confirm that he was only able to access the bins by going down the ramp and activating the garage door and then coming up in the lift.
On 10 February 2022, the lessors' agent asked the tenant if he had a particular key with a blue rim. The tenant replied by saying that he didn't have that key, but in evidence suggested that he had meant that he didn't have the building key, not that he didn't have the key with the blue rim which he had been given at commencement of the tenancy. The lessors' agent then replied on 15 February 2022 to say she was ordering a key. The tenant says the key never arrived.
In April 2023, there were further emails between the tenant and the lessors' agent. The agent indicated on 28 April 2023 that she had ordered a new key. Following the commencement of these proceedings, there were further requests for a key. A new key was finally provided on 22 May 2023.
The respondents acknowledge that a new key to access the building was not provided until after the commencement of these proceedings. However, the photo of the keys provided to the tenant on commencement of the tenancy indicated a key which the respondents claim was the building key in question. The tenant supplied a photo of the similarity between the new key and two other keys the tenant had in his possession. The respondents claimed that this picture suggests that the tenant had the building key all along.
I am satisfied that the tenant did not have access to a building key which enabled him to access the bin area, exit the pool area and access other parts of the building. The consistency with which the tenant asked for a building key and the credibility of the tenant's evidence of the inconvenience caused by, for example, not having ready access to the bin area suggest that the tenant was without a building key from the commencement of the tenancy. While there are similarities between the new key the tenant was provided on 22 May 2023 and some of the original keys that the tenant was provided at the commencement of the tenancy, I am satisfied that the original keys did not enable him to reliably enter the bin area or exit the pool area and restricted his ability to exit the underground parking area.
The tenant was without a building key for over 112 weeks. He indicated that he was able to use a swipe card on some occasions to access parts of the building, but that the swipe card was inconsistent. It wasn't clear which parts of the building were able to be accessed by the swipe card and why and how often the swipe card had failed. I accept the tenant's evidence that he had been trapped in the bin area or in the car park on perhaps 10 occasions each, that he had to use the driveway to access the building on about 15 occasions, and had to wait for a resident or call a neighbour on about 50 occasions to enter the building. I accept that many of these occasions may have caused some distress to the tenant due to the difficulty of navigating a slippery ramp, avoiding cars entering or leaving the garage or being unable to leave the bin area without assistance. The indeterminate nature of the access may also have contributed to this distress along with the physical inconvenience of not having ready use of the facilities in question.
The respondents claimed that they had acted reasonably in not providing a new key in a timely manner when the previous tenant had not claimed any difficulties in accessing the bin and other areas of the building. I accept that the tenant's attempt to demonstrate that he didn't have a key during the first inspection had caused the lessors' agent considerable distress without making it clear that the tenant did not have the building key. The tenant could, in my view, have been clearer in his various interactions with the lessors' agent in identifying the function of the various keys he had been provided with and the difficulties he was having in not having access to a building key. His requests were also intermittent with significant periods between his requests for a building key. However, in my view, the various requests for a building key should have been followed up by the lessors' agent more quickly, and promises to provide a new key should have been kept.
The tenant claimed $2000 for the diminished utility of not having access to the bin area, being slightly less than 5% of the rent payable for the period in which the tenant did not have a building key. I am not satisfied that the tenant suffered significant distress when unable to leave the bin area or car park or by the prospect of having to request assistance beyond that associated with the physical inconvenience involved. Given the tenant's evidence of how often he was trapped or needed assistance and the tenant's contribution to the uncertainty over the missing of a building key, in my view $1000 is an appropriate amount to reflect the loss of utility associated with use of the bin area.
The tenant also claimed over $1700 for the loss of use of the pool for a year. This amount was based on the difference between the average rental costs of what the tenant claimed as equivalent apartments in the area with access to a pool and those without. It was not clear whether the proportion had been amended to reflect the comparatively low costs of the tenancy in this matter. In my view, however, the compensation for loss of enjoyment of a facility provided with the premises depends on the loss suffered by the applicant. On the evidence of the applicant's intended use of the pool and capacity to use the pool throughout the entire period he was without a key (including the colder winter months), and the tenant's contribution to the delay in being given a key, I consider $500 to be an appropriate amount for loss of utility associated with use of the pool area.

Window seal

The applicant claimed that the lessors had failed to repair a window seal after being notified of the need for repair on 12 April 2021. Photographs allowing a comparison of the window seal in question with a neighbour's windows indicate that there is a small (perhaps 10-20mm square) piece of “mohair” which is missing on the bottom part of the seal. This gap allows water, dirt and dust to enter, which exacerbated by the construction site described below. The tenant claimed that he had to regularly clean the area near the gap and that dust and dirt had caused staining to curtains. He also claimed the heater he had purchased was unable to adequately heat the area due to heat loss through the broken seal. He claimed compensation for the depreciation of towels used to clean up water and dirt, electricity costs of washing and drying towels and rags, and additional heating costs.
The lessors' agent claimed that they had made many attempts to repair any problem with the window seal. Repairers had reported difficulty in organising a time to get access to the property and were generally unable to confirm the nature or extent of the fault. The tenant agreed that there had been various attempts to fix the seal, but he had not acted unreasonably in providing access and the attempts were not by qualified tradespersons.
I accept that the window seal in question has been in need of repair since 12 April 2021. However, I am not satisfied that the small gap in the seal has caused the amount of water and dirt to enter the premises or resulted in the additional heating costs as the applicant’s claim would suggest. I also consider that the tenant could reasonably have done more to facilitate repair, including clearly identifying the problem with the window seal at an earlier time. I therefore find that $200 is an appropriate compensation for the failure of the lessors to repair the window seal.
In my view, the repair of the window seal does not require specialised expertise to identify and rectify. It may no longer be possible to obtain the same material that is used at the top of the window. I will therefore order that the lessors make reasonable efforts to repair the seal at the bottom of the bedroom window with the same or similar material as used at the top of the window within 28 days.

Construction site

The tenant gave evidence that there was major construction in the area outside his balcony for over a year from July 2022. This had led to an increase in dust and dirt entering his unit through the gap in the window seal. In the tenant's submissions, the noise and increased dust rendered the balcony "practically unusable for relaxation, clothes drying and growing cooking herbs".[5] The tenant also claimed that he had to purchase a portable heater because the air conditioner was unable to heat the premises during construction work, and that this involved additional electricity cost. The tenant claimed that the lessors should have been aware of the construction site and warned him of the effect and duration of the work.
[5] Submissions of the applicant dated 15 September 2023 at [81]
The respondents deny having any notice of the construction site beyond that of any member of the public. While generally the lessors would have been willing to reduce the rent payable in recognition of the loss of use of the balcony, they had not been informed of any loss until these proceedings were commenced.
The tenant claimed nearly $2700.00 for the loss of use of the balcony. This amount was based on the difference between the average rental cost of what the tenant claimed as equivalent apartments in the area with a balcony and those without. In my view, however, compensation for loss of use of part of the premises depends on the loss suffered by the applicant. I am not satisfied that the construction site would have rendered the balcony unusable for the entire period. I am also not satisfied that the purchase and increased running costs of a portable heater were required due to the fault of the lessors or lack of repair of the window seal, or that the amount claimed in heating costs was justified. I therefore consider $500 to be an appropriate amount to reflect the loss of use of the balcony.

Inspections and rectification requirements

In his initial application, the tenant sought orders disallowing a third inspection of the property by the lessors' agent within 12 months. By the time of the hearing, the lessors' evidence, which I understood the tenant accepted, was that there had not been more than two inspections in any twelve-month period. The tenant claimed, however, that the initial request for an inspection was knowingly in breach of the two-inspection limit.
The tenant also claimed that most recent inspection of 1 August 2023 was scheduled at a time the lessors' agent knew was inconvenient to the tenant and contrary to an agreement reached at a preliminary conference held on 5 June 2023. At the hearing, I pointed out to the tenant that any such agreement was not recorded by the member in orders made following the conference, and that under section 34(3) of the ACT Civil and Administrative Tribunal Act 2008, evidence of any words spoken at a preliminary conference was not admissible.
The tenant also claimed that recent inspections had falsely misrepresented the state of the premises as compared to the incoming condition report. The inspection of 1 August 2023 was claimed by the tenant to be an attempt to gain financial advantage by deception and was "malicious, vindictive and intended to intimidate the Lessor".[6] The evidence in support of this claim of the lessor agent's intentions was not made clear. The tenant pointed to the timing of the inspection, suggesting it was in response to the tenant’s application to the Tribunal. The tenant also pointed to the “demands for remediation” in the inspection report and the requirements to clean cobwebs, window sills, screen door frame, carpet and curtains. The tenant claimed these requirements were unwarranted due to the areas being reasonably clean or reflecting the state of repair and cleanliness at the start of the tenancy as recorded in the initial inspection report.
[6] Submissions of the applicant dated 15 September 2023 at [93]
The condition report of the 1 August 2023 inspection refers to the tenant taking reasonably good care of the property. The tenant is asked to clean the frames, carpet (and keep it to the condition of the incoming report), curtains and spider webs, and photos are provided of the areas in question. There is no requirement that the areas be professionally cleaned. I accept the poor state of the property at the commencement of the tenancy and the relative cleanliness of the property at the time of the inspection, but do not agree that the steps which the tenant was asked to complete go beyond that reasonably expected of a tenant in maintaining the general cleanliness of the property. Disagreement over the accuracy or reasonableness of the inspection report would normally have been expected to be discussed between the tenant and lessors’ agent. It was, in my view, evidence of a breakdown in trust between the tenant and the lessors’ agent that the inspection report could have been considered an unreasonable demand, let alone described as the tenant has.

I am not satisfied that the inspection of the premises constitutes a breach of the tenancy agreement or the lessors’ agent requests anything other than a reasonable response to the state of the premises at the time of the inspection. I am not satisfied that there were actions by the lessors’ agent that amounted to a requirement to carry out the steps for which the tenant claims compensation, including incurring substantial costs for professional cleaning. The request to comply with the inspection report does not give rise to any claim for compensation, repayment of costs incurred by the tenant, or reimbursement of salary for the tenant's time.

Air-conditioner neglect

The tenant's submissions include reference to the lessors’ neglect of failing to service the air-conditioner for “five years or more”.[7] However, the tenant did not provide evidence to indicate what was involved in the servicing of the air-conditioner, what impact, if any, it had in the tenant's case and whether the lessors had been informed of the impact. It was also not clear if the tenant's claim included any compensation for the claimed neglect, rather than merely indicating the poor state of the premises and the lessors’ upkeep. I am therefore not awarding any compensation for this claim.

Rental payment fee

[7] Submissions of the applicant dated 15 September 2023 at [110]

The tenant claimed that he was charged a mandatory rental payment fee which was not disclosed in advertisements for the premises. The tenant claimed that he was not presented with any option but to use the iPayRent service which automatically transfers funds from a bank account or credit card for a fee - in the tenant's case of $1.65 per transaction. The tenant sought repayment of the amounts charged, and that the lessors’ agent be ordered to inform all other affected tenants of the failure to inform them of the fee prior to entering into a tenancy agreement.
In response, the lessors claimed that the amount and payment of the fee were clearly indicated in the agreement the tenant signed when agreeing to use the iPayRent service, and that the tenant had elected to use that method of payment and was able to use a variety of other methods for payment which would not have incurred charges.
I am satisfied that the tenant was not forced to incur the fee for use of the iPayRent service, and that there were other options presented to him. He could also reasonably have made further inquiries of other ways to pay his rent if he was concerned with the fees being charged. I am therefore not awarding any compensation or making other orders relating to this claim.

Contempt of the Tribunal

In his final submissions, the applicant claimed that the lessors, through their agent, had demonstrated a contempt of tribunal processes by disregarding undertakings made during the first preliminary conference and appointing someone as a property manager who was then unable to attend the adjourned preliminary conference due to approved leave. This was disputed by the lessors' agent.
Again, as pointed out to the applicant at the hearing, section 34 of the ACT Civil and Administrative Tribunal Act 2008 prevents the admission of evidence of anything said during the preliminary conference. This meant that any evidence relating to undertakings that may have been made during the preliminary conference was not admissible. The suggestion that the lessors’ agent has acted in disregard of any undertakings made during the preliminary conference is therefore not established. In any event, I would not have regarded the appointment of a property manager who would be in that role for possibly a lengthy period but was unable to attend an adjourned preliminary conference to give rise to concerns amounting to contempt of the Tribunal.

Intimidation and dishonesty of the lessors’ agent

The tenant claimed that the lessors’ request for a third inspection was within 12 months although it was referred to as a routine inspection in accordance with clauses 77 to 79 of the Residential Tenancies Act 1997. The tenant claimed that the lessors’ agent knew this reference to the Act was false, submitting that the lessors’ agent was dishonest and intended to intimidate the tenant. The tenant submitted that the proprietor licensee-in-charge of the lessors’ agent should be referred for review of their class 1 agent licence.
I am not satisfied that the requests for inspection were knowingly false, dishonest or intended to intimidate. There is insufficient evidence to suggest that the initial request was not a request for reinspection. It is not unreasonable for a lessor to request reinspection after a routine inspection to follow up on whether requests, such as cleaning and repairs the responsibility of the tenant, have been complied with. While the reference to routine inspection and clauses in the standard residential tenancy terms may have been inaccurate in this case, I accept that the request was an unfortunate use of a standard template rather than dishonest or an attempt to intimidate.

Conduct of the tenant

The tribunal has the power to make orders in this matter depending on whether it is satisfied on the balance of probabilities that there has been a breach of the requirements of a tenancy agreement or otherwise entitling the applicant to orders under the Residential Tenancies Act 1997.
As set out in Briginshaw v Briginshaw[8]:
The seriousness of an allegation made, the inherent unlikelihood of an occurrence of a given description, or the gravity of the consequences flowing from a particular finding are considerations which must affect the answer to the question whether the issue has been proved to the reasonable satisfaction of the tribunal.
[8] [1938] HCA 34
I have reached my findings above in relation to the tenant's claims that the lessors’ agent has acted in a dishonest or intimidatory way without the need of application of this principle.
It was clear during the hearing into this matter that the tenant is convinced of the dishonest intent of the lessors’ agent. As well as the references to conduct arising from the preliminary conference described above, he also pointed to examples he claimed showed that the lessors’ agent was trying to manipulate the Tribunal. In my view, none of the admissible examples that tenant pointed to was, alone or taken together, sufficient to justify the accusation of dishonesty on behalf of the lessors’ agent.
For example, the tenant had provided a picture of two keys along with a photocopy of the new building key provided to the tenant after the commencement of these proceedings. The lessors’ agent had then labelled the keys as being a bin and a door key along with a key that had been provided to the tenant at the commencement of the tenancy. The tenant, however, claimed that the labels were knowingly false.
However, in my view, the mislabelling could easily have been the result of a misunderstanding of the email in which he had described the photo. The mislabelling also did not affect the submission made by the lessors that the picture suggested that a key substantially identical to the building key had been provided at the commencement of the tenancy. It was only at the hearing, after considerable confusion on the Tribunal's part, that the tenant suggested that one of the keys in question had been recently cut based on the copy of the new building key.
The lessors’ response objected to the tenant's various characterisations of the lessors’ agent as dishonest. They included material arising after commencement of these proceedings. There were also comments made in an email dated 21 April 2023 where the tenant commented:
I’ve endured repairs and faults—many of which the Lessor has known of for more than two years—and I’m confident they would be regarded as urgent.
I’d been polite and moderate until I encountered you, your lies, and your harassment. Am I angry now? You bet. The Lessor and their agents previously didn’t care—but you are truly a vile and deceitful piece of work: the archetype of the dishonest real estate agent. Am I risking my tenancy? You bet. I’d rather maintain some dignity and integrity, not to mention peace, comfort and privacy.
I can understand the tenant's frustration with, for example, the delays in providing a replacement key or carrying out repairs as discussed above. However, there was no evidence before me to justify the language used by the tenant in these and other emails and at the hearing. In my view, the use of that language both unnecessarily escalated the dispute and substantially prevented the parties resolving this matter without a contested hearing. On the evidence before me, accusations of dishonesty and harassment were not justified and can only impede the ability of the parties to resolve issues as they arise in the future of the tenancy.

Orders

The tenant has therefore been partly successful in his claim for compensation for loss of amenity in relation to not having a building key and hence not being able to access the bin area and pool area as well as being unable to enjoy other facilities. I have also awarded him $200 in compensation for the failure of the lessors to repair the bedroom window seal, and will require the lessors to again attempt to repair the window seal. I have also awarded $500 in compensation for the loss of use of the balcony.
I therefore make the following orders:
The respondents are to pay the applicant the sum of $2200, comprising of:
(a)$1500 in reduced rent for not having a building key which provided access to facilities including the bin and pool areas;
(b)$200 in compensation for a failure by the respondents to engage in reasonable repairs to the bedroom window seal; and
(c)$500 in reduced rent for loss of use of the balcony.
The respondents are to make reasonable efforts to repair the seal at the bottom of the bedroom window with the same or similar material as used at the top of the window within 28 days.

………………………………..

Senior Member D Stewart

Date of hearing:		20 November 2023
Applicant:		In person
Respondents:		Ms C Patmore, authorised representative