Havelock Housing Association -v-Lee-Ann Jamal
[2006] ACTRTT 19
•8 August 2006
Havelock Housing Association -v-Lee-Ann Jamal
ACTRTT19 [2006]
CATCHWORDS
Occupancy Agreement
Contra proferentem
ISSUES
Whether the Occupancy Agreement was in fact an occupancy agreement within the meaning of section 71C Residential Tenancies Act 1997
LEGISLATION
Residential Tenancies Act 1997 (ACT)
Section: 71C
Prescribed term: 53
Housing Assistance Act 1987- sections 3A, 11A
Commonwealth State Housing Agreement 2004
CASES CITED
Radaich v Smith 1959 101 CLR 209;
The Wik People v Queensland 1996 71 ALJR 173;
Bruton v London Quadrant Housing Trust 1999 3 AER 481;
Allianz Australia Workers Compensation NSW Ltd v PPG Industries Australia P/L 2004 ACTCA 28;
Residential Tenancies Law and Practice in NSW Anforth, Thawley and Christensen at [3.28.2]
CASE REFERENCE NUMBER: RT 2057 of 2006
RE: Premises at 13.6/85 Northbourne Avenue TURNER ACT 2612
DECISION
The Respondent is to pay the Applicant immediately the sum of $769.73 being:
(a) rent arrears of $643.73;
(b) cleaning costs and repair of a deadlock at $126.00.
Member: A. Anforth
Date: 8 August 2006
STATEMENT OF REASONS
Background:
Havelock Housing Association is an incorporated association in the ACT which manages public housing stock on behalf of the ACT Government. In the present instance the premise related to a self contained multi bedroom unit located with the Havelock House complex in Turner in the ACT. The Respondent resided in her own bedroom sharing the common facilities with the other residents of the unit. Havelock House consists of a multiplicity of such units. The occupants of a unit paid rent to Havelock House and shared the cost of electricity. Heating is supplied by gas which was paid to Havelock House in the form of a utilities levy. The utilities levy also included a component for furniture and equipment for common use. None of the units were separately metered for electricity or gas and the levy was an average over the whole of the units in the complex.
On 16 June 2005 the Respondent entered an agreement which purported to be an Occupancy Agreement within the meaning of section 71C of the Residential Tenancy Act 1997.
The Respondent vacated the premise on 25 January 2006 leaving the following debts:
(a) rent arrears of $643.73,
(b) $126.00 for the combined cost of cleaning and repair of a dead lock
On 16 May 2006 Havelock House filed an application with the Tribunal seeking orders for the above compensation and annexing invoices and a rent ledger in support of the claim.
The matter was listed on 6 June 2006. Ms Bray appeared for Havelock House and there was no appearance of the Respondent. The Tribunal was concerned about its jurisdiction to hear the matter given that the Agreement between the parties purported to be an occupancy agreement as opposed to a residential tenancy agreement, and the Tribunal had recently had cause to query the proper scope of the definition of occupancy agreements in other matters.
The matter was adjourned to 18 July 2006 with orders that the parties file and serve submissions concerning the construction of the section 71C(1)(d) of the Act and its application to the present occupancy agreement.
No submissions were filed and the matter came before the Tribunal again on 18 July 2006.
The legislation:
Section 71C(1) of the Act provides:
(1) An agreement is an occupancy agreement if—
(a) a person (the grantor) gives someone else (the occupant) a right to occupy stated premises; and
(b) the premises are for the occupant to use as a home (whether or not with other people); and
(c) the right is given for value; and
(d) the grantor may lawfully terminate the agreement, without cause, by giving less than 6 months notice; and
(e) the agreement is not a residential tenancy agreement.
(2) The agreement may be—
(a) express or implied; or
(b) in writing, oral, or partly in writing and partly oral.
(3) The right to occupy may be—
(a) exclusive or not;
(b) given with a right to use facilities, furniture or goods.
(4) The person given the right to occupy the premises may be—
(a) a boarder or lodger; or
(b) someone prescribed under the regulations for this section.
Reasons:
Part 5A of the Act was inserted by the Residential Tenancies Amendment Bill 2004. The Explanatory Statement presented to the Legislative Assembly with the Bill relevantly read:
Clause 23 – New part 5A – provides for the insertion of a new part 5A, dealing with occupancy agreements.
The existing Act does not deal with a number of agreements for the occupation of premises for living purposes. In particular, it excludes boarder and lodger agreements from the operation of the Act. The Act is amended to apply to a wide range of these agreements (not including those specifically excluded under proposed section 4 (above), principally agreements of a short term nature (including licenses, boarder contracts and lodger contracts – these extend over a wide range of premises presently excluded from the Act, including caravan parks and student accommodation).
This proposal involves two distinct elements, which are designed to commence at different times.
Firstly, the jurisdiction for determining disputes between occupants and lessors under short term occupancies are vested in the Residential Tenancies Tribunal (presently these disputes are heard in other courts). Initially, disputes in relation to this extended jurisdiction would be determined under the existing contracts and the common law having regard to certain specified principles. (Amendments having this effect are found both in new Part 5A and amended Part 6).
Secondly, the legislation is amended to permit the development of new sets of core agreements (by regulations, in consultation with stakeholders) which would apply to different short term occupancies together with a set of general principles, reaffirming the rights of occupants in such agreements to maintain a reasonable standard of living conditions.
New section 71A defines who is a grantor under an occupancy agreement.
New section 71B defines who is an occupant under an occupancy agreement.
New section 71C defines an occupancy agreement to mean an agreement where a person (the grantor) grants to another person (the occupant) for value a right of occupation of premises for use as a residence by the occupant (whether with or without other persons) where the agreement may be terminated at law without cause for any period less than six months. This formulation does not apply to any agreement, which is a residential tenancy (which, in general, may only be terminated without cause with six months notice.)
10. Two motivations for the definition of “occupancy agreements” emerge from the Explanatory Statement:
(a)occupancy agreements were intended to confer a measure of security of tenure on “short term” residencies:
(b)the six months notice criteria of section 71C(1)(d) was intended to distinguish occupancy agreements from residential tenancy agreements which cannot be terminated without cause except on 6 months notice (section 47(1)(a) and prescribed term 94).
11. In the present case the agreement between the parties is expressly stated to be an “occupancy agreement”. It has no fixed term and purports to be periodic in nature from its inception commencing on 16 June 2005.
12. The Occupancy Agreement has annexed a set of Service Rules and a set of what are described as the Occupancy Agreement Terms . The latter is in fact the full set of Prescribed Terms from the Schedule to the Residential Tenancies Act 1997 with a few additions appended at the end of the prescribed terms dealing with the utilities levy.
13. The Rules set out various parts of the relationship between the parties and between co-occupants, in what is described as “a group share accommodation”. The Rules expressly did not confer any right on the Respondent to the possession of any particular unit within the housing complex or any room within a unit.
14. The Rules make provision for the recovery of costs associated with re-keying units, the sharing of electricity costs between residents of a unit, restrictions on the conduct of occupants including the right to have guests, the right to be absent from the premises, the right to cook in the unit, noise levels, house rules generally and the process for the termination of the occupancy agreement under the heading “Eviction”.
15. The “Eviction” provisions read as follows:
28 The Grantor may issue an Eviction Notice giving seven days notice to vacate for the breaches of this Agreement contained in clause 33.
29 An Eviction Notice shall be handed to the Occupant, delivered to their premises, or placed in their unit's letterbox. It will state the exact reasons for the eviction, the effective date to vacate, and arrangements for departure. The notice will also include information on the Appeals Procedure. Any disagreement with the notice should in the first instance be discussed with the Grantor's issuing staff member.
30 The Occupant may appeal the issue of a 7-Day Eviction Notice.
31 The Occupant may appeal their eviction in writing within 24 hours of having received the Eviction Notice. The Grantor agrees to reserve the Occupant's premises for the time it takes the appeal to be heard.
32 After receiving a 7-Dday Eviction Notice, any further breach of this Agreement including harassment or threatening behaviour towards other people at Havelock House will result in an immediate Eviction Notice.
33 The following shall be breaches of this Agreement for which the Occupant may be evicted with seven days notice:
a. Supplying illegal drugs from Havelock House.
b. Using their premises and/or unit for illegal or unauthorised purposes.
c. Threatening and/or violent behaviour towards other people at Havelock House.
d. Unauthorised entry into another occupant's premises, unit or any other areas of Havelock House premises.
e. Theft of property belonging to other people at Havelock House or the Grantor.
f. Knowingly accommodating a person who has been banned by the Grantor and/or has an outstanding debt owed to the Grantor.
34 The Grantor may issue an Immediate Eviction Notice to the Occupant to immediately vacate for the reasons contained in clause 37.
35 There is no right of appeal against an Immediate Eviction Notices due to the serious nature of the breaches concerned.
36 Where the Grantor terminates this occupancy agreement under clause 34, the Grantor will take reasonable steps to secure the premises and the goods of the evicted Occupant until the close of the next business day. After that day, the Grantor will store, for a further period of not less than 1 week, any lawful possessions of the evicted Occupant which are located in the premises and will provide the evicted Occupant or agent reasonable opportunity to recover those possessions during that period of storage.
37 The following shall be breaches of this Agreement for which the Occupant may be evicted with immediate effect:
a. Physical violence against other people at Havelock House,
b. Use of or threatening to use lethal weapons.
c. Serious vandalism and/or deliberate destruction of Havelock House or other occupant's property.
d. Any further breach of this Agreement following the issue of a 7-Day Eviction Notice, including harassment or threatening behaviour towards other people at Havelock House.
e. Knowingly accommodating a person who has been evicted under this clause of this agreement.
16. It is apparent from the above that the Rules provide only for eviction based on conduct which amounts to a breach of the Occupancy Agreement and that otherwise the residents/occupants have security of tenure on an indefinite basis.
17. This is not unexpected for public housing. Public housing in the ACT is funded in part through the Commonwealth State Housing Agreement 2004 (CSHA) and in part from the ACT’s own funds. The ACT’s involvement in the CSHA is acknowledged in Part 2A Housing Assistance Act 1987 and the CSHA is a notifiable instrument pursuant to section 11A Housing Assistance Act 1987.
18. The CSHA relevantly provides for funding of, inter alia, community housing projects (para 2.5 CSHA) of which Havelock House is an example. One of the core goals of the CSHA is to provide “secure” and “affordable” housing for people. Without wishing to traverse the whole of the CSHA it is sufficient to note the opening words of paragraph 2 of the CSHA:
Stable, secure and affordable housing is a critical element of the lives of all people in our community…
19. Paragraph 2.5 of the CSHA refers to the community housing policy of providing “sustainable and flexible (housing) options”. In this sense “sustainable” is synonymous with “secure” i.e. enduring or long term as opposed to transient.
20. The ACT governments housing policy is given effect to by the Housing Assistance Act 1987 and the housing programs made there under. Section 3A sets out the “objects” of the Act, the first of which is:
(a) to maximise the opportunities for everyone in the Act to have access to housing that is affordable, secure and appropriate to their needs>
21. In the light of this background the Tribunal has no difficulty in finding that the Havelock House Rules intended to give effect to this policy, and for this reason the “eviction” provisions in the Rules deliberately provided only for eviction for breach of sufficient gravity to warrant the eviction.
22. If the matter rested there the Tribunal would be forced to conclude that the Rules did not bring the agreement within the ambit of section 71C(1)(d) in that the Rules did not provide for eviction without cause on less than 6 months notice. In fact the Rules make no provision for eviction without cause and by inference permit only eviction for cause.
23. But the matter does not rest there. The Occupancy Agreement also incorporates into the Agreement the whole of the Prescribed Terms of the Residential Tenancies Act 1997. The inclusion of these Prescribed Terms complicates the picture in two ways:
(a) There is inconsistency between the terms of the annexed Rules and the terms of the annexed Prescribed Terms.
(b) If the Rules apply then no residential tenancy or tenancy at common law has been created; but if the Prescribed Terms apply then both a residential tenancy and a tenancy at common have been created.
24. The Rules and the Prescribed Terms differ in many ways, if not in fact in respect of each term of the Rules. It is not productive to spend time and space to point out each inconsistency. For present purposes it is sufficient to note a few key examples:
(a) The Rules purport to deny a resident any exclusive right of occupancy of any room (clause 3) whereas Prescribed Term 53 does purport to grant an exclusive right of occupancy.
(b) A tenant is accorded the right of quiet enjoyment of their premises free from the control of the landlord subject only to the terms of the Act and Prescribed Terms. The Rules purport to regulate matters in a restrictive manner which would otherwise be open to a tenant eg the right to have visitors, the right to take a holiday from the premises for what ever length of time they choose, the right to come and go at any hour without concern for the noise level caused in doing so, and the right to cook food of their choice as and when they chose irrespective of the smell.
(c) The Rules contain eviction provisions which set up a regime totally different to that of the Prescribed Terms. Most notably, the Rules do not provide for any right of eviction without cause whereas the Prescribed Terms 94 permits eviction without cause on 26 weeks notice.
(d) The Rules in the form the terms appended at the end of the Prescribed Terms make provisions for a levy for gas for heating based on the total consumption of all the units of Havelock House as a single entity. This is inconsistent with the corresponding provisions in the Prescribed Term 42(c) which requires separate metering of each tenanted premises before the gas cost can be passed onto the resident.
(e) The Rules provide for the occupants of a unit to share the electricity costs. The units are not separately metered and thus Prescribed Term 42 also prevents the passing on of this cost by Havelock House to the occupants of a unit.
25. There is nothing in the Occupancy Agreement which gives any indication as to whether the Rules (including those addition terms appended to the Prescribed Terms) or the Prescribed Terms themselves are to take precedence in the case of inconsistency.
26. The situation is becomes worse. If the Prescribed Terms are applied then all the rights of a residential tenancy are conferred. It matters not that the Agreement itself is called an “Occupancy Agreement” if the terms of the Agreement are those of a residential tenancy (Radaich v Smith 1959 101 CLR 209; The Wik People v Queensland 1996 71 ALJR 173; Bruton v London quadrant Housing Trust 1999 3 AER 481). In this event sections 9-10 of the Residential Tenancy Act 1997 would apply to render void most of the Rules on the basis of their inconsistency with the Prescribed Terms.
27. The problem for the Tribunal is how to unravel the apparent inconsistencies in the drafting. The Tribunal is of the view that it is pointless to attempt any subtly reconciliation of the inconsistent terms and doubts that subtlety was the hallmark of the authorship in the first instance. It more appears that the Prescribed Terms were adopted without any real consideration of their impact.
28. In these circumstances the only approach the Tribunal can see open to it is to apply the “contra proferentem” principle to the effect that the terms of the Agreement are construed against the interest of the party which drafted the Agreement i.e. Havelock House (Allianz Australia Workers Compensation NSW Ltd v PPG Industries Australia P/L 2004 ACTCA 28; Residential Tenancies Law and Practice in NSW Anforth, Thawley and Christensen at [3.28.2])
29. Applying the contra proferentem approach the Tribunal concludes that the Prescribed Terms annexed to the Agreement are more beneficial to the occupants and therefore apply with the result that the Respondent is the tenants of her room, and is a joint tenant of the common area facilities of her units with the other co-residents of her unit. This then has the effect of invalidating most if not all of the Rules.
30. The Tribunal appreciates that this result may cause some consternation for the Applicant, but the solution is to redraft the Agreement in a manner which is internally consistent with guidance from a clear policy agenda.
31. Having found the Respondent is in fact a tenant under a residential tenancy agreement, the Tribunal finds it has jurisdiction to hear and determine the present dispute
32. On this premise the Tribunal has no difficulty with any of the items of damage claimed at paragraph 3 above
ORDERS:
The Respondent is to pay the Applicant immediately the sum of $769.73 being:
(a) rent arrears of $643.73;
(b) cleaning costs and repair of a deadlock at $126.00.
A. Anforth
Member
8 August 2006
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