Green v Roberts - [2007] SADC 51

District Court of South Australia
(District Court Administrative and Disciplinary Division: Appeal Under Residential Tenancies Act 1995)
GREEN v ROBERTS
[2007] SADC 51
Judgment of His Honour Judge Beazley (ex tempore)
1 May 2007
LANDLORD AND TENANT - TERMINATION OF THE TENANCY
Residential Tenancies Act - Appeal against findings and orders of Tribunal - Whether tenancy validily terminated, relevance of previous invalid Notice of Termination served by post, application based upon invalid Notice listed for hearing, subsequent Notice validly served and due to expire one day before hearing, procedural fairness, rent paid up. Whether a valid Notice required to be in existence as at date of filing Application for Possession - Held - Orders of Tribunal quashed.
Residential Tenancies Act 1995 ss32(1), 80(2), 120(1); Residential Tenancies (General) Regulations Form 2, referred to.
Sullivan v Department of Transport (1978) 20 ALR 323 at 343; Baldry v Jackson (1976) 2 NSWLR 415; Eshelby v Federated European Bank Ltd (1932) 1 KB 254; Water Authority of Western Australia v AIL Holdings Pty Ltd (No2) (1993) 10 WAR 233; Woods Bagot Pty Ltd v Stapeldon (2005) SASC 20, considered.

GREEN v ROBERTS
[2007] SADC 51

James William Green, (“the tenant”) appeals, pursuant to s41 of the Residential Tenancies Act 1995 from Orders made by the Residential Tenancies Tribunal on 19 April 2007.
The formal orders of which the tenant complains are as follows:
“1.Pursuant to s93 of the Act an order in favour of the landlord for possession of the premises at Unit 8, 36-38 Eighth Street, Gawler South at 11 am on Thursday, 26 April 2007, on condition that if the tenant fails to give up possession, then the order for possession may only be enforced by the Tribunal Bailiff.
2.Pursuant to s110(1)(i) of the Act, that the security bond of $800 held by the Commissioner be paid to the landlord via the agent.
3.Pursuant to s110(1)(c) that the tenant make the following payment to the landlord: $269.28 within 14 days of the date of the order. Failing payment this order may be registered in the appropriate Court and enforced as an Order of that Court”.
Background
It is common ground that the tenant entered into the residential tenancy agreement with the landlord of the premises, Kirsty Roberts, for a period of 12 months commencing on 1 November 2005. A security bond in the sum of $800 was paid by the tenant. That initial period of 12 months was extended by a document executed in August 2006 for a further 12 month period commencing 1 November 2006 and ending on 31 October 2007.
The rental of $205 as adjusted was to be paid fortnightly to the landlord’s agent Homburg Brock Harcourt, Barossa. The latter kept a ledger report for the landlord, which detailed all rental and other payments made by the tenant.
That report evidenced that on various occasions during the initial term, of 12 months, payments had been dishonoured, presumably on the basis that the tenant did not have sufficient funds in his direct debit account. The records disclose that the tenant had always met his obligations albeit late on those occasions. Notwithstanding those defaults the landlord was prepared to extend the term of the lease by a further 12 months expiring on 31 October 2007.
By late March 2007 however, the tenant had fallen into arrears again. Rent was paid only up to 4 March 2007 with a credit of $190.
Procedural Irregularities
The common form Tenancy Agreement provided for 7 days notice to be given to the tenant in the event of a failure to pay rent. Section 80(2) of the Act expressly provides for possession to be taken at an earlier time than for other breaches where notice has been provided in respect of the failure to pay rent. The Act provides potential remedies to a tenant. Section 80(4) provides that the tenant may make application, inter alia, to reinstate the tenancy. On 23 March 2007, the landlords agent posted a Form 2 Notice of Termination to the tenant to remedy the breach of the agreement in respect of rent. She was entitled to proceed that way pursuant to s 120(1)(b) of the Act. The notice provided for possession to be given and taken by 2 April 2007. However, because the letter was sent by post, this did not allow for seven days to pass. The earliest date for possession to be taken was 3 April 2007. This would not have been apparent to the agent at that time. For reasons which follow I do not need to consider whether the rent was in fact in arrears to the extent of 14 days at that time, as a payment of $600 was made by the tenant.
The Tribunal subsequently concluded, with respect quite correctly, that the Notice dated 23 March 2007 was invalid.
The agent on behalf of the landlord made application to the Residential Tenancies Tribunal on 5 April 2007 based upon that invalid notice of 23 March 2007, for an order that the tenancy was validly terminated under s80 of the Act. At that time the agent did not know that the Notice of Termination was invalid. The potential invalidity of the notice was only brought to the attention of the agent by letter from the Registrar of the Tribunal on 5 April 2007. That letter included a suggestion that the current application be withdrawn and that the process be recommenced.
The application dated 5 April 2007 was not withdrawn. A notice dated 11 April 2007 was sent to the tenant by the Registry fixing the hearing date for Thursday, 19 April 2007. Notwithstanding the fact that the application of 5 April 2007 had annexed to it the invalid Notice of 23 March 2007, the agent issued a fresh Form 2 Notice of Termination dated 10 April 2007. On this occasion pursuant to s 120(1)(c) of the Act, the agent stuck copies of the notice on the front and laundry doors on that day. At that time the tenant was away on an interstate trip, however the Notice constituted valid service on 10 April 2007.
The Notice referred to possession being required to be given on 18 April 2007, that is to say, one day before the date fixed for the hearing in the Tribunal. That hearing had presumably been based upon the earlier invalid Notice of Termination.
The Hearing – 19 April 2007
There was no appearance by the tenant. A note in the Registry file recorded that the tenant had telephoned to say that he could not attend the hearing as he was still interstate working as a truck driver. He had hoped to be back in time, but was delayed. The note further read: ‘The tenant paid $600 last week and will pay $400 today. He thinks that should bring him up-to-date. He has tried to ring the agent to let them know what was happening but hadn’t been able to get hold of her.’
The Tribunal referred to that note in its Reasons for Decision. It did not however refer to the payment of the sum of $600 and its relevance to the total arrears. It proceeded to hear and determine the application in the absence of the tenant. It had the power to do so under s32(1)(d) of the Act. It equally had the power to adjourn the application with a view to promoting the settlement of the matters in dispute between the parties.
It permitted the agent to tender the subsequent notice dated 10 April 2007. The tribunal then proceeded to hear the application filed on 5 April 2007 for relief based upon the Notice of 10 April 2007, which arose after the application was filed. There is a well known principle of law that a cause of action must be complete as at the date of the issue of the originating proceedings, see Eshelby v Federated European Bank Ltd (1932) 1KB 254;Water Authority of Western Australia v Ail Holdings Pty Ltd (No.2) (1993) 10 WAR 233 and finally Baldry v Jackson (1976) 2 NSWLR 415. This rule has now been overcome in superior courts by the Rules of Court. See Woods Bagot Pty Ltd v Stapledon (2005) SASC per Perry J at 20.
For reasons which will become clear, I do not need determine whether the principle applies to a Tribunal designed to expedite matters in a very informal manner. I note however that Form 7 under the Residential Tenancies (General) Regulations, (1995), provides that a copy of the Notice of Termination upon which the application is based should accompany the application. In this case the relevant Notice of Termination was not and could not have accompanied the Application of 5 April 2007. In the absence of the tenant, the Tribunal concluded that it was not satisfied that it was just and equitable to reinstate the tenancy. It must have concluded that the outstanding rent was approximately $659.00 as at 10 April 2007, as it projected the total arrears to be $1069.28 as at 26 April 2007. Although it is unclear from the Reasons whether any allowance had been made for the credit of $190, I accept Ms Polkinghorne’s statement that the alleged total arrears did in fact take account of all credits.
The Order
The Tribunal ordered that the security bond of $800 be paid to the landlord, which left projected arrears in the sum of $269.28 owing by the tenant as at 26 April 2007.
The Appeal
On 26 April 2007 because of its urgency, I stayed the possession order until this day at 5.00 pm, and listed the Appeal for full hearing. On the Appeal the tenant appeared in person, and the landlord was represented by her agent, Ms Polkinghorne.
It became apparent that there were disputes between the parties as to matters of communication, the whereabouts of the tenant interstate, and the quantum of payments made. Mr Green made it clear that he had expected to attend the Tribunal hearing however was still interstate at the date of the hearing. He said further that he did not get the Notice of 23 March 2007, until 9 April 2007. Ms Polkinghorne had endeavoured on numerous occasions to make contact with Mr Green and eventually made contact with the tenant’s sister to try to locate him.
Discussion on issues raised by the Appeal
The Tribunal was placed in a difficult position because of the absence of the tenant from the hearing. It appears that the failure of tenants generally to attend Tribunal hearings is a relatively common event. As I have previously indicated it is quite proper for such tribunals to proceed in the absence of a party, whether it be a tenant or a landlord.
An absent party could hardly be heard to subsequently complain of procedural unfairness when he or she elects to be elsewhere after receiving proper notice of a hearing which would provide the opportunity for that person to be heard.
No application was made by Mr Green for an adjournment. As the Full Court of the Federal Court said in Sullivan v Department of Transport (1978) 20 ALR 323 at 343.
“The absence of any application for an adjournment does not, however, necessarily conclude the issue adversely to the appellant. The failure of a Tribunal which is under a duty to act judicially, to adjourn a matter may conceivably, constitute a failure to allow a party the opportunity of properly presenting his case even though the party in question has not expressly sought an adjournment ….In this regard, however, it is important to remember that the relevant duty of the Tribunal is to ensure that a party is given a reasonable opportunity to present case. Neither the Act nor the common law imposes upon the Tribunal the impossible task of ensuring that a party takes the best advantage of the opportunity to which he is entitled”.
In this case the Tribunal had knowledge of the history of default and an acknowledgement by the tenant in his telephone call that he was in arrears to some extent at least.
In this case however, the application for an order confirming termination had been issued before the tenant received the valid notice of termination dated 10 April 2007.
The Notice specified the date of 18 April 2007 for possession. The tenant had already received a Notice from the Tribunal on or about 11 April 2007 informing him that the application for an Order for Possession would be listed on 19 April 2007, one day after the expiration of the new notice. The very document upon which the order was to be made had not even been lodged with the Tribunal.
In my opinion this is one of those rare cases where the Tribunal ought to have adjourned the application. The tenant had given an apparently legitimate reason for not being in attendance. The Tribunal was being requested to act upon a Notice which had not been filed. It had found the earlier Notice to be invalid. Such an adjournment would have enabled the tenant to consider his position with respect to the new notice. Prima facie, at the very least, the tenant might have been confused about the new notice of termination and its relevance to the application issued on 5 April 2007. As it turns out Mr Green did not fully understand the two notices which had been forwarded to him. From his point of view there may have been no point in making an application for reinstatement under s 80(4) nor in complying with the new Notice by 17 April 2007, because he had already been informed by Notice from the Registry that a hearing for an Order for Possession had been listed for 19 April 2007.
I am now in a better position than the Tribunal to assess the true position with respect to the rental arrears, and the special reasons as to why the tenant required accommodation in this area, namely to be near his child. It is common ground that the tenant has now paid all of the outstanding rent. I will therefore determine whether the Tribunal would have considered it just and equitable to make an order for the reinstatement of the tenancy pursuant to s 80(5) of the Act, had it been appraised of the additional information provided to me. Clearly had the proceedings been recommenced as suggested by the Registrar or alternatively a short adjournment granted, the tenant would no longer have been in arrears, and the default explained.
Ms Polkinghorne submitted quite forcefully that she had done all that she could possibly have done to bring the default to the attention of the tenant. She stressed that the landlord had been constantly concerned about whether in fact the rental monies would be received from a designated debit account. She stressed the unfairness to the landlord should the tenancy be reinstated. In those circumstances she urged me not to set aside the order of the Tribunal.
Having heard the submissions of Ms Polkinghorne and acknowledging the force of those submissions, this is a most unusual set of circumstances given the existence of the two Notices. I now know that the rental has been paid in full, without reference at all to the $800 bond which had been ordered to be made available to the landlord.
This is an urgent matter and the parties need to have this matter resolved. I have concluded that it is just and equitable to reinstate the tenancy. I accordingly quash the orders made by the Tribunal on 19 April 2007. The formal orders are therefore:
1.That the Residential Tenancy Agreement be reinstated pursuant to s 80(5) and s 110(1)(f) of the Act.
2Insofar as is necessary, I order that the $800 bond be repaid to the Commissioner and designated with the Account No.3450293-0.
These orders have the effect of restoring the parties to their respective rights and obligations under the terms under the Residential Tenancy Agreement.