Holloway v Van Berk

[2011] QCATA 131

CITATION: Holloway and Anor v Van Berk and Anor [2011] QCATA 131

PARTIES:	Mr Roger Martin Holloway & Ms Sulochni Holloway (Applicants/Appellants)
v
Mr Michael John William Van Berk & Rebecca Van Berk (Respondents)

APPLICATION NUMBER: APL049-10

MATTER TYPE: Appeals

HEARING DATE: On the papers

HEARD AT: Brisbane

DECISION OF: Richard Oliver, Senior Member
Peta Stilgoe, Member

DELIVERED ON: 31 May 2011

DELIVERED AT: Brisbane

ORDERS MADE:

Leave to appeal is granted.1.    

The appeal is allowed.2.    

The application be remitted to the minor civil disputes jurisdiction.3.    

The application is to be listed for a compulsory conference at 1:30pm on 1 August 2011.4.    

The application is not to be listed before the Adjudicator who conducted the original hearing.5.    

CATCHWORDS:

Residential Tenancy – where claim for compensation after the conclusion of the tenancy – where the lessor prepared detailed list of defects and costs of rectification – whether reasons adequate and addressed the lessor’s claims

Queensland Civil and Administrative Tribunal Act 2009, ss 121(4), 143(3), 146

Drew v Makita (Australia) Pty Ltd [2009] 2 Qd R 219
Camden v McKenzie [2007] QCA 136
QUYD Pty Ltd v Marvass Pty Ltd [2009] 1 Qd R 41
Cachia v Grech [2009] NSWCA 232
Glenwood Properties Pty Ltd v Delmoss Pty Ltd [1986] 2 Qd R 388
McIver Bulk Liquid Haulage Pty Ltd v Fruehauf Australia Pty Ltd [1989] 2 Qd R 577
Attorney-General v Kehoe [2001] 2 Qd R 350
Tully v McIntyre [2001] 2 Qd R 338

Justice in Tribunals (3rd Ed) (Federation Press, Sydney, 2010)

APPEARANCES and REPRESENTATION (if any):

This matter was heard on the papers, pursuant to section 32 of the Queensland Civil and Administrative Tribunal Act 2009 (QCAT Act).

REASONS FOR DECISION

Mr Oliver

[1]     The Holloways own an acreage property at 62 Hampton Road, Rocksberg which is near Morayfield.  On 15 August 2008 they entered into a residential tenancy agreement with the Van Berks to rent the property for the period of 12 months from 17 August 2008.  The tenancy agreement extended beyond the 12 months and on 29 November 2009 the Van Berks vacated the premises. 

[2]     On 30 November the Holloways inspected the property and prepared an exit report with the Van Berks being present.  The report was not completed but it did list damage to various parts of the property and the condition of the premises.  Mr Holloway returned some days later and completed the exit report which then contained a full list of damage requiring repair and items requiring replacement.

[3]     The Holloway’s formulated a claim of $5,770.00 for the cost of items purchased and labour to effect repairs as well as, $3,747.00 for loss of rental income.  They then filed an application in the Tribunal seeking compensation on 21 January 2010.

[4]     Although the Holloways agreed that the tenancy terminated on 29 November 2010 in accordance with the agreement, the claim for loss of rent is in the nature of damages because of the condition the property when vacated by the Van Berks.  The Holloways claim they could not rent the property until the damage had been repaired and the property reinstated so that it could then be placed on the rental market.

[5]     The Holloways’ claim for repair and reinstatement cost was set out in a very comprehensive statement they prepared and filed in the Tribunal.  It included a schedule of costs, supported by commentary and photographs which runs to some 160+ pages.  The schedule, which commences at page three of their submissions/evidence is fully itemised to arrive at the totals of $5,250.79 for replacement items plus labour of $1,040.00.  This is a little different to the claim as formulated in the application.  Mr Holloway also gave evidence at the hearing of his observations as to the condition of the premises of both when the Van Berks moved in and after they moved out.

[6]     The Van Berks also gave evidence challenging the Holloways’ claims for damages and supported that with two independent witnesses.  There was certainly no acceptance by them of the Holloways’ allegation of their responsibility of the condition of the premises at the end to the tenancy.

[7]     At the conclusion of the hearing the learned Adjudicator made a finding that the Van Berks should reimburse the Holloways the sum of $762.50 and the bond of $1,900.00 should be paid out in accordance with those findings.  The $762.50 is made up of rent ($353.50), for cleaning ($154.00), cleaning out the grease trap ($210.00) and half the filing fee.  The effect of that finding is that nearly all of the applicants’ claim was dismissed. 

[8]     After the hearing, the Holloways filed an application for leave to appeal or appeal.  Leave is necessary as this is an appeal from a minor civil dispute.[1]  The grounds of appeal contend that the Holloways did not get a fair and reasonable hearing in that they took considerable time to prepare the 165 page submissions which itemised every item of damage and this was not properly considered in the time available.  They contend that they were disadvantaged by restrictions imposed by pressures of time available on the day of the hearing.

[1] QCAT Act, section 142(3).

[9]     It is true that there are time pressures in the minor civil disputes jurisdiction because it is a busy one with many matters allocated to be heard on a particular day.  The learned Adjudicator did his best in the time available to canvass the important issues raised by the parties and focussed on the exit report which was not done in conjunction with the tenants.  It is not necessary to recite the evidence of every issue before him in the hearing, particularly when the comprehensive submission and evidence contained in the 165 page document was before him.  One cannot be critical of the actual hearing process before the learned Adjudicator in that environment.

[10]     However, there is an obligation on the Tribunal to give reasons for its final decision in a proceeding either orally, or in writing.[2]  Those reasons must be adequate and must address the issues that were put before the Tribunal for determination.  The need for adequate reasons was discussed in Drew v Makita (Australia) Pty Ltd[3] by Muir JA:-

“The rationale for the requirement that Courts give reasons for their decisions provides some guidance as to the extent of the reasons required.  The requirement has been explained, variously, as necessary: to avoid leaving the losing party with “a justifiable sense of grievance” through not knowing or understanding why the party lost; to facilitate or not frustrate a right of appeal; as an attribute or incident of the judicial process; to afford natural justice with procedural fairness; to provide “the foundation for the acceptability of the decision by the parties and the public” and further “judicial accountability”.[4]

[2] QCAT Act, section 121(4).

[3] [2009] 2 Qd R 219 at [58].

[4]            References excluded.

[11]     It is recognised that this Tribunal is not a Court however, the principles generally apply and the extent that the reasons provided must be tailored to the nature of the dispute that is before the Tribunal and the issues raised for determination.

[12]     Failure to give adequate reasons is an error of law.[5]

[5]            Camden v McKenzie [2007] QCA 136 at [29].

[13]     For leave to appeal to be granted, the applicant’s must, inter alia, identify an error on the part of the primary decision maker[6] or whether it is necessary to correct a substantial injustice to the applicant caused by some error.[7]

[6]            QUYD Pty Ltd v Marvass Pty Ltd [2009] 1 Qd R 41.

[7]            QUYD Pty Ltd v Marvass Pty Ltd (supra).

[14]     On a careful reading of the transcript and the reasons of the learned Adjudicator,[8] there is no indication that the matters raised by the applicant as particularised in the 165 page submission were addressed, not necessarily in a detailed way given the time constraints, but even generally.  The learned Adjudicator seemed to focus on the exit report and that it was not prepared contemporaneously with the tenants on their departure from the premises, but over some days thereafter thereby suggesting it lacked probative value in determining whether or not the Holloways had good reason for complaint.  There is no discussion or reasoning to support the rejection of the Holloways’ claim for damage to the property, or even the damages for loss of rent by reason of the property’s condition.  The reasons are inadequate and do not set out any logical basis for the dismissal of the Holloways’ claim.  The only basis proffered is that there was difficulty allowing the claim because of “the critical evidence that is in the form of the entry and the exit (report)”.  This does not address the veracity or otherwise of the Holloways’ evidence or any specific reason for rejecting their evidence. 

[8]            Transcript page 87-89.

[15]     As the inadequate reasons are an error of law leave to appeal should be granted.  It follows from the reasoning above that the appeal should be allowed and as a consequence, the Tribunal can:

(a)   Confirm or amend the decision; or

(b)   Set aside the decision and substitute its own decision; or

(c)   Set aside the decision and return the matter to the Tribunal for reconsideration[9].

[9] QCAT Act, section 146.

[16]     It seems to me that the best course in the circumstances is to remit the matter to the minor civil dispute jurisdiction and for it to be listed for a compulsory conference.

Orders

1.    Leave to appeal is allowed.

2.    The appeal is allowed.

3.    The application be remitted to the minor civil disputes jurisdiction.

4.    The application is listed for a compulsory conference on a date to be advised to the parties.

5.    The application is not it be listed before the Adjudicator who conducted the original hearing.

Ms Stilgoe

[17]   Mr & Mrs Van Berk were tenants in a house owned by Mr & Mrs Holloway.  The entry condition report records that, when the Van Berks took possession in August 2008, the property was not “pristine”.

[18]   The Van Berks vacated the property on 29 November 2009.  The Holloways effected repairs to the house, which they say were a consequence of the Van Berks’ tenancy and brought proceedings in the tribunal claiming:

Loss of rent	$70.70
Loss of income	7,425.00
Cost of repairs	5,259.79
Labour	1,040.00
Motor vehicle costs	2,327.25
Total	$16,122.74

[19]   The learned Adjudicator ordered that the Holloways receive just $762.50 compensation calculated as: five days’ rent at $353.50; carpet cleaning of $154.00; grease trap cleaning fees of $210 and half the filing fee.  The Hollows have appealed the learned Adjudicator’s decision stating:

a)    The learned Adjudicator did not properly examine the detailed material they produced to the tribunal.

b)    The tribunal did not provide sufficient time for the learned Adjudicator to consider all of the evidence.

c)    The witnesses produced by the Van Berks were unhelpful and should not have been believed.

[20]   Conversely, the Van Berks assert:

a)    The Holloways had ample time to present their case but failed to be coherent, reasoned and succinct.  Further, they say that the Holloways wasted time cross-examining witnesses to no real benefit.

b)    The witnesses gave their evidence honestly and the learned Adjudicator should have the benefit of that.

c)    The learned Adjudicator’s decision was open to him on the material.

[21]   Because this is an appeal from the tribunal’s minor civil dispute jurisdiction, leave is necessary.  The question whether or not leave to appeal should be granted is usually addressed according to established principles: Is there a reasonably arguable case of error in the primary decision?[10]  Is there a reasonable prospect that the applicant will obtain substantive relief?[11]  Is leave necessary to correct a substantial injustice to the applicant caused by some error?[12]  Is there a question of general importance upon which further argument, and a decision of the appellate court or tribunal, would be to the public advantage?[13]

[10]        QUYD Pty Ltd v Marvass Pty Ltd [2009] 1 Qd R 41.

[11]        Cachia v Grech [2009] NSWCA 232 at [13].

[12]        QUYD Pty Ltd v Marvass Pty Ltd (supra).

[13]Glenwood Properties Pty Ltd v Delmoss Pty Ltd [1986] 2 Qd R 388, at 389; McIver Bulk Liquid Haulage Pty Ltd v Fruehauf Australia Pty Ltd [1989] 2 Qd R 577 at 578, 580.

[22]   I have read the transcript carefully.  While I understand that the tribunal’s minor civil dispute jurisdiction is a very busy one and that Adjudicators have neither the time nor the resources to explore each and every argument advanced by the parties, I do have concerns about the conduct of this proceeding:

a)    A large part of the proceedings focussed on the circumstances surrounding the early weeks of the tenancy which do not appear to have been relevant to the learned Adjudicator’s decision.

b)    There is no detailed examination of each of the elements of the Holloway claim.

[23]   The learned Adjudicator rejected much of the Holloway claim because:

a)    The entry report shows that “things were not ideal from the beginning”.[14]

b)    The Holloways did not prepare an exit report in a timely way after the Van Berks vacated the property.[15]

[14]          Transcript page 67, lines 16-17.

[15]        Transcript page 87, lines 23–24, 45-47.

[24]   The learned Adjudicator found that the delay in preparing the exit report allowed the opportunity for a third person to “contaminate the evidence”[16] but there is no suggestion from any party that this did, in fact occur.  Further, the learned Adjudicator accepted that the obligation to prepare the exit report did not lie with the Holloways,[17] yet penalised them for not attending to that report.

[16]        Transcript page 87, line 47.

[17]        Transcript page 87, lines 12-14.

[25]   Of more concern, however, is that the learned Adjudicator did not explain how the entry and exit reports prevented the Holloways from recovering losses for items that were not recorded on either report.  Examples include the landscaping, damage to the pool furniture and graffiti on internal furniture.

[26]   The nature and extent of the obligation to provide full reasons varies according to the nature of the case.[18] In the tribunal’s minor civil disputes jurisdiction, giving immediate oral decisions accords with the spirit and purpose of the QCAT Act. Those decisions will not be exposed to criticism which fails to acknowledge the circumstances in which they are given, or the pressure of the adjudicator’s caseload.

[18]Attorney-General v Kehoe [2001] 2 Qd R 350 at 356; Tully v McIntyre [2001] 2 Qd R 338.

[27]   There is a strong case for treating the failure to give reasons for a decision as a necessary element of providing natural justice.[19]  The denial of natural justice is an error of law for which leave to appeal may be granted.

[19]        Justice in Tribunals (3rd Ed) (Federation Press, Sydney, 2010) at p 249 para 13.2.

[28]   While I have considerable sympathy for the learned Adjudicator, who had devoted over four hours to this dispute and had another three cases to determine that day, I consider that the failure to consider (or at least refer to) the detail of the Holloway claims, the inference of third party interference without any evidence to support that inference, and the failure to give reasons for refusing much of the Holloway claim justifies leave for appeal and for the appeal to be granted.

[29]   Given the scope of the dispute, and the time that has already been spent on it, the proceedings should be referred to a compulsory conference in the tribunal’s general civil list.  I otherwise agree with the orders proposed.