Jackson v L J Hooker (Salisbury) - [2010] SADC 159

District Court of South Australia
(Civil: Appeal Under Residential Tenancies Act 1995)
JACKSON v L J HOOKER (SALISBURY)
[2010] SADC 159
Judgment of His Honour Judge Beazley (ex tempore)
10 December 2010
LANDLORD AND TENANT - RENT
RESIDENTIAL TENANCY - RECOVERY OF ALLEGED OVERPAYMENT OF RENT -
Appeal against findings and orders of the Residential Tenancies Tribunal - at issue was whether tenant had paid additional two weeks rent which had not been accounted for by agent - additional claim for one other alleged overpayment - whether the tenant had in fact paid bond and overpaid rental payments - whether Tribunal misunderstood the evidence - whether tenant denied a fair hearing in absence of tenant's son as witnesses - evidence of the parties as to rental and bond payments reheard - whether the landlord rather than the agent ought to have been the respondent to the application and appeal - the need for cogent evidence when allegations of wrongdoing involve serious consequences to a party.
Held: Findings by Tribunal that additional sum of $500 had not been paid by tenant, and that there was no overpayment of rent justified on the evidence at the hearing and upon the rehearing. Tribunal decision and orders made on 5 July 2010 affirmed.
Residential Tenancies Ace 1995 ss 41, 54 - 63 and 101; Sullivan v Department of Transport (1978) 20 ALR 323 at 343; Timms v S.A. Housing Trust [2003] SASC 60; Briginshaw v Brighinshaw (1938) 60 CLR 336; ACCC v Aust Safeway Stores Pty Ltd (2003) 129 FCR 339, referred to.

JACKSON v L J HOOKER (SALISBURY)
[2010] SADC 159
Introduction

Joan Jackson (“the tenant”) appeals pursuant to s 41 of the Residential Tenancies Act 1995 from orders made by the Residential Tenancies Tribunal on 5 July 2010 dismissing a claim for compensation by the tenant against LJ Hooker Salisbury, apparently as agent for Anthony Wood and Sheila Wood (“the landlords”).
The background
In November 2009 the tenant and the landlords entered into a Residential Tenancy Agreement for a periodic tenancy commencing on 13 November 2009 (“The tenancy Agreement). The tenancy Agreement provided for rental, at the rate of $250 per week, to be paid fortnightly in advance. It is clear from the schedule to the tenancy Agreement, being Exhibit P1, that it was initialled by the tenant. On its face it provided a schedule of fortnightly rental payments, the first payment of $500 was to be paid on 13 November 2009 and thereafter at $500 per fortnight as either a direct debit or internet transfer (B-Pay). That document expressly provided for a first rental payment of $500, not $1,000. It is the tenant’s case that notwithstanding that document, and the fact that she received a receipt for only $500, she had in fact paid an additional $500 in cash. The tenancy Agreement which was executed for and on behalf of the landlords by their agent LJ Hooker, also provided for the payment of a security bond in the sum of $1,000.
There is no dispute that cheques in the bond sum of $1,000 and $500 towards the first two weeks rent in advance were paid by South Australian Housing Trust on behalf of the tenant.
What was in dispute before the Tribunal was the allegation of overpayment by the tenant. The tenant had vacated the premises on 4 May 2010. She then alleged for the first time, contrary to what appeared on the face of the tenancy Agreement, that the agent for the landlords had demanded that she pay an additional two weeks rent of $500. She asserted that at the time the cheques totalling $1,500 from the South Australian Housing Trust were paid, she was required to pay and did in fact pay an additional sum of $500 in cash. She acknowledged that the subject cash sum of $500 was not receipted.
By application dated 12 May 2010 the tenant sought an order against LJ Hooker (Salisbury) for compensation, claiming the remission of the additional two weeks rent which she alleged was paid by her in cash at the commencement of the tenancy. No other sum was claimed in that written application.
The Tribunal Hearing
On 5 July 2010 the Tribunal conducted a hearing upon that application. No point was taken as to whether the correct respondent ought to have been the landlords. It is clear that any claim ought to have been brought against the landlords. The tenant attended in person as did her son Thomas Jackson. The named respondent was represented by Darren Morris and Karen Hansen who were employees of the landlord’s agent LJ Hooker, Salisbury. The tenant and the two representatives were sworn. The proceedings were conducted in a very informal manner, quite appropriately, so as to enable the issues to be identified and determined.
As it transpired Thomas Jackson was not asked to give evidence despite being identified as a witness to the transaction, and the employee, Ms Hansen, gave evidence by way of a bare denial. No evidence was given as to the background events leading to the meeting on 13 November 2009.
The tenant gave evidence that she had moved out of the subject premises on 4 May 2010. She told the Tribunal that she recalled that when she executed the tenancy Agreement, on or about 11 November 2009 she was asked by the landlords’ representative Ms Hansen to pay 4 weeks rent rather than the two weeks which appeared on the Schedule to the Agreement.
She had explained that she attended with her two sons, and was desperate to find accommodation. She repeated that she gave Ms Hansen $500 in cash in addition to the respective cheques of $1,000 and $500 provided by the Housing Trust. She said that she didn’t remember getting a receipt.
She was cross-examined about the source of the alleged $500. She accepted that there was no written record to confirm that she paid the $500 nor its source.
She acknowledged that she had examined the agent’s records, when she had attended upon the agent to pay for the second rental period, and had noted that the agent had made a mistake about the starting date. She had not however raised anything about the alleged cash payment of $500 not being recorded, nor not being receipted until many months later when she left the premises. As to where she had sourced the $500 in cash, she said that she was unable to produce any record from any bank but added:
No well I don’t take money out, I didn’t take money out on that date specifically for that. I had a sum of money on me. I changed money over when I came from overseas.
She acknowledged that the record at the office of the agent disclosed each and every payment including the $1,000 bond and each rental payment of $500 thereafter save for there being no reference at all to the alleged cash payment of $500.
She told the Tribunal that it was unfortunate that her other son, Dean, was not available to give evidence as he had to work at that time. It may be that that comment, misled the Tribunal into believing that Thomas could not give evidence.
When asked about the cash sum of $500 and why it wasn’t recorded she alleged that Ms Hansen must simply have retained the cash. When further asked about why she did not request a receipt, she said that she was in an “awful state” when she came to the respondent’s premises as she had nowhere to live.
She then raised, apparently for the first time, before the Tribunal a further alleged overpayment of $70.86 based upon the alleged number of days that she had been living in the premises. She conceded that in fact that she had paid an additional sum of $178.55 which was calculated to be the exact sum from 29 April 2009 to 4 May 2009 when she left the premises.
She conceded that indeed those persons who had calculated the days may have been in error.
The decision of the Tribunal
The Tribunal approached the matter on the basis that it was, effectively oath on oath as between the tenant and the representatives of the landlords. The Tribunal referred to the detailed records of the agent. Implicitly the Tribunal considered the likelihood that the agent would have breached s 54 of the Act as to the amount of rent which may be requested of a tenant in advance; s 57 as to the duty to keep proper records of rent, and s 58 as to the duty to give a receipt for rent, all of which carry penal sanctions.
The Tribunal was not satisfied that the tenant had proved her case. The Tribunal was also not satisfied that there was any overpayment of rent albeit that it hadn’t been properly claimed in the application. See Timms v SA Housing Trust [2003] SASC 60. The Tribunal therefore dismissed the application and delivered brief reasons in support of those findings on 13 July 2010.
Notice of Appeal
On 9 August 2010 the tenant issued a Notice of Appeal which again named the respondent as LJ Hooker Salisbury. In that notice she complained of the order for dismissal of her claim for compensation in respect of both sums, namely the sum of $500 representing an alleged additional two weeks rent in advance; and $70.86 as an overpayment.
On 24 August 2010 a second Notice of Appeal was filed naming the respondent as LJ Hooker (Salisbury) however apparently in the same form.
The Appeal
On the hearing of the appeal the tenant appeared in person while the representatives of LJ Hooker, Karen Hansen and Darren Morris again appeared. Again no point was taken as to whether the correct respondents ought be the landlords, rather than the agent.
The tenant was accompanied by her sons Thomas Jackson who had previously attended before the Tribunal, and Dean Jackson who had been unable to attend on that day.
The tenant implicitly submitted that she had not been given the opportunity before the Tribunal to put her case in the absence of her son Dean Jackson.
The Full Court of the Federal Court said in Sullivan v Department of Transport (1978) 20 ALR 323 at 343:
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 … 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 his case. Neither the Act nor the common law imposes upon the Tribunal the impossible task of ensuring that a party taken the best advantage of the opportunity to which he is entitled.
At that time the tenant was given the opportunity to present her case.
The tenant ultimately conceded that she had no basis to complain about the manner in which the first hearing before the Tribunal was conducted, save that she perceived a bias in favour of the agent.
I pointed out to the tenant that her application was an appeal and that there was no obligation upon this Court to rehear the evidence taken before the Tribunal. See Timms v South Australian Housing Trust [2003] SASC 60.
Indeed it was clear that Ms Jackson was simply repeating most of the matters she had raised before the Tribunal.
She was critical of the way in which the tribunal kept referring to the absence of documents to support her case. She drew the impression that there was some bias against her in favour of the respondent. Implicitly she was critical of the fact that the tribunal kept referring to oral evidence as if it were of no value. In my view the tribunal did not undervalue oral evidence. It was attempting to convey, because of the underlying allegations of serious breaches of the law by Ms Hansen, that there was a need for the tenant to prove her case by cogent evidence. It was clearly difficult to discern from the evidence what exactly had happened when the parties met and the cheques were undoubtedly presented.
There were, however, some differences on appeal in that the tenant’s son Dean was now available to give evidence and, indeed, Thomas wished to give evidence.
Having regard to these differences and the fact that Ms Hansen only gave a bare denial before the tribunal, I determined that pursuant to s 41(2) (a) of the Act the tenant, Joan Jackson, her sons Dean and Thomas Jackson, and Karen Hansen should be given the opportunity to give evidence before me, if they wished.
The tenant and her two sons all deposed on oath that they attended on 11 November 2009 and that a cash sum of $500 had been paid to the agent. There were some subtle differences in their respective memories, but it appeared that each of them indicated that there had only been one attendance upon the agent, and that was the day that the cheques were handed over. The two sons recalled that their sister also attended.
Ms Jackson said that prior to meeting the agent for the first time, she had become acquainted with the landlords, Mr & Mrs Woods. She thought, contrary to what she had told the Tribunal that it may have been the Woods who had told her that there was a need for a payment of four weeks rent rather than two weeks. She initially had difficulty in recalling whether in fact it was the Woods who mentioned a rental of $250 per week, but ultimately could not deny that in fact they had informed her both about the need for four weeks’ rent and the quantum of that rent before she saw the agent.
She said that she must have had a telephone conversation with Karen Hansen before attending the Housing Trust. She couldn’t accurately recall whether in fact a telephone conversation had occurred. In any event, she said she went to the Housing Trust and asked them for a bond in the sum of $1000. She said that she had asked for, effectively, four weeks rental in addition but was told by the Housing Trust that she could only receive a cheque for $500.
She said she took those cheques together with the sum of $500 in cash with her to the agent. When examined about the source of that cash, she said:
I think my son helped me out with the other $250. He went halves with me – the eldest boy.
She said that they had arrived from overseas on 9 November 2009 and that she was in somewhat of a state because of the need to find accommodation for her children. She said that she had changed some money and that, whatever the source, she had $500 in her possession. She was adamant that she only went once to the agent’s office before entering the tenancy.
She acknowledged that the first time that she raised this allegation of a $500 overpayment of rent was after she had left the premises on 4 May 2000. She said when she paid the $500, she was aware that in fact $1000 had been paid separately for a security bond. When asked why she didn’t insist the $500 be applied to the second fortnight rent, she said that she must have treated it as some additional security bond because two weeks later after 13 November 2009, she paid the next two weeks’ rent of $500.
Dean Jackson gave evidence that the first time he had been asked to reflect upon what had happened was shortly after 4 May 2010. He said that he could recollect accompanying his mother to the Housing Trust. He said that he could overhear some discussion about the need for a security bond and also for rent assistance.
He said that his recollection is that his mother was told by the Housing Trust that they couldn’t pay all the rent that was being sought. Subsequently a cheque or two was produced.
He said that he accompanied his mother, his brother Thomas and his sister to the agent’s offices. He had no involvement in respect of the documentation, however, his recollection was that an envelope containing some cash was handed over by his mother to the agent. He said, contrary to his mother’s evidence, that he did not give her any cash as he had none at that time.
Thomas Jackson gave evidence that he couldn’t recollect now whether he went with his mother to the Housing Trust to get the bond and rental cheques but he did accompany her with his brother and sister to the agent’s office. He also conceded that he paid no money to his mother in relation to the rent, nor did his brother Dean. His recollection was that there was a cheque from the Housing Trust for $500. He couldn’t recall any other cheque but he was certain that $500 in cash was paid by his mother. He said that he recalled that his mother had shown him the cash before they went to the agent’s office. He recalled that she was upset that she had to find four weeks rent in advance. He was certain in his own mind that the cash money was handed to Ms Hansen by his mother.
Karen Hansen elected to give evidence. She explained the background to all of what had occurred. She said that contrary to the evidence of the witnesses, the transaction, which occurred at Golden Grove, involved two attendances by Ms Jackson. Ms Hansen said on the first occasion Ms Jackson attended, she explained that there was a need for two weeks rent in advance as well as the bond for $1000. She said she produced the form required by the Housing Trust before a security bond would be paid. She said she was aware that the tenant was a friend of the landlords, and assumed that they had already spoken about the residence. It was only after the tenant had been to the Housing Trust to collect the security bond that the Residential Tenancy Agreement was executed.
Ms Hansen said that on that second occasion she sat down with Ms Jackson. Her son Thomas was seated at the same table while his brother Dean was sitting over on a couch. She said she took Ms Jackson through the document which is Exhibit P1. She read out the schedule which provided for the sum of $1000 for the bond; and the sum of $500 for the first as two weeks rent in advance. Both of those sums were covered by Housing Trust cheques. She observed the tenant to read each page of the tenancy Agreement which document was then initialled by Ms Jackson. She said that she then had prepared in the office the receipts for the sum of $500 rent as required by the Act; and the $1,000 for the security bond. She said, contrary to the evidence of Ms Jackson, that the receipts were not only prepared that day but were given to Ms Jackson that day, together with a booklet and the keys to the house.
Ms Hansen appeared to be quite angry at what she perceived to be an allegation of fraud namely that she in some way had pocketed the sum of $500. She detailed her history as an agent. She was well aware of the requirements in ss.54-57 of the Act; and in particular her obligations to keep proper records, and to issue a receipt for rent.
She said that she was aware that the tenant was a friend of the Woods, the landlord for whom she was acting.
Discussion
I have set out that evidence in great detail in order to explain how difficult it is for a court on appeal to determine issues of credit. I have listened very carefully to the evidence of each of the witnesses. I have no doubt that Ms Jackson and her two sons, Thomas and Dean, genuinely believe that in fact an additional sum of $500 was paid by the tenant at the time of the entering into the tenancy Agreement. I have no doubt that they have focused upon what they knew was a requirement to pay four weeks rent in advance. As it transpires that figure of four weeks rent also equates to the security bond of $1000.
Ms Jackson, is a sole parent on a carer’s pension responsible for the care of her son Dean. I have no doubt that she struggles every day with expenses and has genuinely convinced herself that in fact rental totalling $1000 was paid in addition to the security bond of $1000. I have no doubt that she has reconstructed in her mind that she must have been required to pay an additional $500 paid in cash.
She undoubtedly reconstructed some of her evidence. She “thought” that half of the $500 cash must have come from her son. Both sons denied it. Before the Tribunal she was adamant that it was the agent who told her to produce four weeks in advance. In this Court she conceded she may have been told that by her friend, the landlord Ms Wood. Having heard each of the witnesses I cannot say that any of them are untruthful. I have no doubt that both Ms Jackson and her sons have unwittingly reconstructed certain events in their minds. This was plain from their evidence and the expressions used by them ‘that something must have occurred’, ‘I must have rung her’, ‘I must have done this’. What is objectively clear is that no allegation of over-payment had been made until after 4 May 2010.

Objectively the allegation by the tenant flies in the face of the terms of the tenancy Agreement which required a bond of $1,000 and only two weeks rent in advance.
Ms Jackson’s reconstruction that she must have thought at the time that it was a further $500 bond simply cannot be accepted. If indeed it was an additional two weeks rent in advance there is no explanation as to why she paid rent only two weeks later. When she attended on or about 27 November she noted that there was an error in the starting date. However she made no comment about the additional rent, nor about its non receipt. Her only explanation was that she had just come from overseas and was unaware of the obligations in that regard.
I reflected very carefully upon the evidence of Karen Hansen. She impressed me as a competent employee responsible for the receipt of moneys on behalf of her clients. I do not accept for one moment that a cash payment of $500 was made by the tenant, was kept by her, and neither receipted nor accounted for by her. I repeat that in my opinion Ms Jackson and her two sons have unwittingly reconstructed the events in their minds. It may well be that they have convinced themselves that four weeks rent has been paid because the bond of $1000, paid by the Housing Trust, is based upon four weeks rent.
I am faced with a complaint made by the tenant which involves extremely serious allegations of misconduct in civil proceedings. They go to the heart of a responsibilities of an agent acting for a landlord pursuant to ss 54-58 of the Residential Tenancies Act.
As I have already said, the failure to receipt rent; the failure to record rent; and the alleged breach of duty in demanding a tenant pay more than two weeks rent in advance, all carry penal sanctions.
The principle in Briginshaw v Briginshaw (1938) 60 CLR 336 is that a court should not lightly make a finding, on the balance of probabilities, that a party to civil litigation has been guilty of either fraudulent or criminal conduct. Accusations of wrong doing implicitly involve serious consequences for the agent in this case, and justice demands that an accuser, must produce cogent evidence to satisfy the Court. It, therefore, directs a court to proceed cautiously in a civil case where a serious allegation has been made or the facts are improbable. See also Australian Communications and Media Authority v Mobilegate Ltd [2010] FCA 1197.
As to the claim for overpayment of the sum of $70.86, this was only lightly pressed by the tenant. In my opinion there is no basis at al for that claim.
Conclusion
In this case the evidence of the tenant and witnesses called by her is inconsistent with the schedule of payments under the tenancy Agreement and the conduct of the tenant up to 4 May 2010. It is inconsistent with the receipts which I find were handed to the tenant by the agent on 13 November 2009.
In the event the tenant has failed to satisfy me that the cash sum of $500 was paid by her on that occasion when the tenancy Agreement was executed on 13 November 2009.
I do not believe for one moment that either Ms Jackson or her sons have been untruthful. I repeat that I have found that they have quite unwittingly reconstructed the events in their minds.
I do however positively say that I accept entirely the evidence given by Ms Hansen on that topic.
Those findings are consistent with those made earlier by the Tribunal. In my opinion it is obvious that it was a finding that was open to the Tribunal to reach the conclusion that it did. I, accordingly, affirm the decision and order of the tribunal.
Formal Orders
1.That the decision and the order of the Tribunal dismissing the tenant’s claims be affirmed.
2. That the appeal by the tenant be dismissed.