Gabrielle Rosengren v Stice Enterprises Pty Ltd T/A Re/Max Excellence - [2023] QCAT 390

QUEENSLAND CIVIL AND
ADMINISTRATIVE TRIBUNAL

CITATION:

Gabrielle Rosengren & Ors v Stice Enterprises Pty Ltd T/A Re/Max Excellence [2023] QCAT 390

PARTIES:

GABRIELLE ROSENGREN

(first applicant)

RYAN PHILLIPS

(second applicant)

JOSHUA AMES

(third applicant)

v

STICE ENTERPRISES PTY LTD T/A RE/MAX EXCELLENCE

(respondent)

APPLICATION NO:

1956/22

MATTER TYPE:

Residential tenancy matters

DELIVERED ON:

29 September 2023

HEARING DATE:

5 January 2023

HEARD AT:

Brisbane

DECISION OF:

Adjudicator Marshall

ORDERS:

The Respondent must pay the Applicants the sum of $2000 within 7 days of the date of this order.

CATCHWORDS:

LANDLORD AND TENANT – RENT – VARIATION OTHERWISE THAN UNDER TERMS OF LEASE – OBLIGATIONS, PROHIBITED MATTERS AND PROTECTION FOR LESSEES – where tenants entered into lease – where approval for further occupants sought – where agent advised ‘no red flags’ with proposed occupants – where authorisation of proposed occupants not formally finalised – where notice issued for unauthorised occupation – where agent offered new lease for increased rental – where unauthorised occupants formally approved at the higher rental – where new lease may be unlawful incentive – where rent increase may be in contravention of legislation

Queensland Civil and Administrative Tribunal Act 2009 (Qld)

Residential Tenancies and Rooming Accommodation Act 2008 (Qld)

David Grant & Co Pty Ltd v Westpac Banking Corporation & Anor (1995) 47 CLR 265

SBT v Bernats Lewis Real Estate & Ors [2022] QCATA 71 at 28

APPEARANCES & REPRESENTATION:

Applicant:

Self-represented

Respondent:

Crystal Cummins, Trust Account Administrator, Re/Max Excellence

REASONS FOR DECISION

What is this application about?

This is an application for compensation in respect of an increase of 100 dollars in weekly rent where the applicant alleges the rent increase was not compliant with the provisions of the Residential Tenancies and Rooming Accommodation Act 2008 (RTRAA).
The first applicant contends the formal approval of the second and third applicants by the respondent was contingent on the rent being increased by 100 dollars per week; and on entering into a new lease (second agreement), which reflected the higher rent.
Directions were issued on 11 January 2023, seeking further submissions. No further submissions were received from either party.
Was the application made in time under the RTRAA?
Section 419 of the RTRAA sets a six-month time limit on this type of application, subject to section 417. The first applicant made a dispute resolution request to the Residential Tenancies Authority (RTA) on 12 July 2022. The applicants had until 25 July 2022 to make an application about the dispute.[1] That application was made on 12 July 2022.
[1]A dispute resolution request includes making a dispute resolution request to the RTA about the dispute issue. The second agreement was signed by the respondent on 25 January 2022.
Joinder of parties

Should the second and third applicants be bound by or have the benefit of the decision of the tribunal in the proceeding

The second and third applicants were tenants in the property and contributed to paying the rent under the first lease and second agreement.
It is on this basis that the second and third applicants were joined under section 42(1)(a) of the Queensland Civil and Administrative Tribunal Act 2009, on the initiative of the tribunal by way of section 42 (3).
First agreement
On 4 January 2022 the first applicant and her mother (who lived interstate) had entered into a rental agreement (first agreement) for 54 Paxton Street, North Ward, Qld 4810 (property) at an amount of $495 per week. The respondent had suggested that, as the first applicant’s income was assessed by the respondent as not being sufficient to pay the rent as a sole tenant, the first applicant’s mother be added to the first agreement.
It was mutually agreed between the parties that the first applicant would seek two co-tenants who would be added to the first agreement (the property had been advertised as suitable for share housing) when approved by the respondent. At this time, the first applicant’s mother would be removed from the first agreement. I accept the evidence of the first applicant that this was the understanding between her and the respondent.
The first applicant met with the second and third applicants, who subsequently applied to the respondent to be approved to occupy the property.
The first applicant made inquiries of the respondent as to when the applications of the second and third applicants would be formally approved. The respondent advised that there was a delay in processing the applications, but that there were ‘no red flags’ in relation to the second and third applicants. At the hearing, the respondent stated that the second and third applicants ‘had not been approved or declined at the time and they moved in immediately’.[2]
[2]Transcript page 1-3 [45].
Clause 45 of the special terms of the first agreement state that:
‘the tenant must not permit persons other than the persons nominated in the special terms to reside at the premises without the written consent of the lessor. The lessor must act reasonably in exercising the lessor’s discretion when determining whether or not to consent to a request by the tenant for any change to the approved tenants or occupants’. The respondent relied at hearing on this clause.
Importantly, the discretion in Clause 45 must be exercised reasonably. In circumstances I find the exercise of the discretion was not reasonable in that the consent came only if the tenants agreed to pay $100 more in weekly rent.
The first applicant had not yet moved to Townsville to live in the property, so requested by email to the respondent that the keys be provided to the second and third applicants, who were ready to move into the property.
I find the evidence of the first applicant to be persuasive when she stated that:
‘all parties, including RE/MAX and myself, knew that they were picking up the keys in order to move in.’[3]
[3]Transcript page 1-5 [40].
I find that the second and third applicants had been informally approved by the respondent at the time of the telephone conversation between the first applicant and the respondent, and that the respondent handed the keys to the second and third applicants in the knowledge that they would occupy the property from that time.
This view is supported by the later approval of the second and third applicants after the applicants agreed to a higher rental rate, fearing being evicted from the property.
On 4 January 2022, the same day the first agreement was signed, the respondent handed over the keys to the second and third applicants, who occupied the property, completed and returned the entry condition report (on 11 January 2022), as required under the RTRAA.[4]
[4]Section 65 Residential Tenancies and Rooming AccommodationAct 2008.
The first applicant occupied the property approximately two weeks later.
Form 11 Notice to Remedy Breach
On 20 January 2022, the respondent issued to the first applicant a Form 11 Notice to Remedy Breach, citing the second and third applicants as unauthorised occupants and giving 7 days for the breach to be remedied. The Form 11 stated a Form 12 Notice to leave may be issued if there was non-compliance with the Form 11.
On 21 January 2022 at the instigation of the respondent, all the applicants electronically signed the second agreement which increased the rent by 100 dollars per week and formally added the second and third applicants to the lease. I accept the evidence of the first applicant that all the applicants signed the second agreement in fear of being evicted.
I find that the second and third applicants were in fact approved by the conduct of the respondent on 4 January 2022 in that:
(a)the respondent had verbally indicated to the first applicant that the second and third applicants would be approved under the first agreement, including by stating that there were ‘no red flags’ (informal approval);
(b)the respondent provided the keys to the property to the second and third applicants on 4 January 2022, knowing that they were moving into the property; and
(c)the second and third applicants were formally approved when all applicants agreed to enter into the second agreement on 21 January 2022; at an increased rent.
I find that the issuing of the Form 11 was not valid. The second and third applicants were approved by the respondent to reside at the property as of 4 January 2022, although this had not been confirmed in writing at the time.
The first agreement was not terminated pursuant to the RTRAA.[5] The signing of the second agreement effectively terminated the first agreement.
[5]Section 277(a) Residential Tenancies and Rooming AccommodationAct 2008.
Second agreement at higher rate of rent, without notice, in under six months
Was the increase in rent in the second agreement a significant change in a subsequent agreement under section 71 of the RTRAA
The RTRAA makes provision for tenants who have entered into a rental agreement to make an application to the tribunal about a significant change to the agreement when entering into a new rental agreement for the property.[6] Significant change includes a change to the rental amount.
[6]Section 71 Residential Tenancies and Rooming AccommodationAct 2008.
An application under section 71 of the RTRRA must be made within 30 days after the tenant signs the new agreement. The tribunal has no jurisdiction under section 61 of the Queensland Civil and Administrative Tribunal Act 2009 to increase the time limit under section 71 of the RTRAA.[7]
[7]SBT v Bernats Lewis Real Estate & Ors [2022] QCATA 71 at 28; David Grant & Co Pty Ltd v Westpac Banking Corporation & Anor (1995) 47 CLR 265
No such application was made to the tribunal. However, had an application to the tribunal been made within time, the increase of 100 dollars per week may have been found to be excessive given that it was a 20.2% increase in the rent.
Was there a breach of section 93 of the RTRAA
Section 93(2) of the RTRAA makes it an offence to increase rent less than six months since the existing rent became payable by the tenant:
93(2) The lessor or lessor’s agent must not increase the existing rent less than 6 months since the date the existing rent became payable by the tenant. Maximum penalty—20 penalty units.
The rent for the property was increased 17 days after the first amount was agreed and a lease signed.
At the hearing the respondent stated ‘…it was the owner’s instruction to negotiate new conditions with the tenants for the (second and third) applicants to be approved…’[8] The ‘new conditions’ appear on the evidence to be limited to an increase of 100 dollars per week in rent; and approval of the second and third applicants. The respondent is an agent of the owner of the property and is required to act in compliance with the RTRAA.
[8]Transcript page 1-4 [15]
This increase in rental is, in my view, a breach of section 93(2) of the RTRAA[9] as a period of six months had not elapsed since the rent was first set.
[9]An application about a general dispute between lessor and tenant may be brought under section 429 (1) of the RTRAA, subject to section 417.
Section 93(5)(a) of the RTRAA applies the provision about increasing rent when ‘at least one of the tenants responsible for the existing rent will be subject to the increase in rent;’. The first applicant was a tenant under the first and second agreements, enlivening the provision.
Are the applicants entitled to compensation
The tribunal has the power to make an order for compensation under section 420(1)(e) of the RTRAA, and to make an order for the payment of money under s. 420 (1)(b).
420 Orders about breach of agreements
(1) If an application about a breach of a residential tenancy agreement or a rooming accommodation agreement is made to a tribunal, the tribunal may make any 1 or more of the following orders—
(a)     an order restraining any action in breach of the agreement;
(b)     an order for the payment of money;
(c)     an order requiring an action in performance of the agreement;
(d)     an order that a party to the agreement perform the work, or take the steps, stated in the order to remedy a breach of the agreement;
(e)     an order for compensation;
(f)     an order requiring payment of all or part of the rent under the agreement to the tribunal until—
(i) the whole or part of the agreement has been performed; or
(ii)an application for compensation has been decided;
(g)     an order requiring payment (from rent paid to the tribunal) towards—
(i) the cost of remedying a breach of the agreement; or
(ii) an amount for compensation.
(2) An order under subsection (1)(a) may be made even if it provides a remedy in the nature of an injunction or order for specific performance in circumstances where the remedy would not otherwise be available. (emphasis added)
Section 52(1) of the RTRAA provides that duties and entitlements given to tenant or lessor under the Act is taken to be a term of the residential tenancy agreement. Therefore, the respondent’s breach of section 93(2) of the RTRAA is a breach of the first and second agreements. This makes the extra rent charged to the applicants to be without lawful basis.
It is for this reason that the applicants are entitled to compensation.

Orders

The Respondent must pay the Applicants the sum of $2000 compensation within 7 days of the date of this order.