Jackson v Lepp Investments Pty Ltd - [2016] SASC 62

Supreme Court of South Australia
(Miscellaneous Appeal: Permission to Appeal)
JACKSON v LEPP INVESTMENTS PTY LTD
[2016] SASC 62
Judgment of The Honourable Justice Parker (ex tempore)
18 March 2016
LANDLORD AND TENANT - TERMINATION OF THE TENANCY - GENERALLY
APPEAL AND NEW TRIAL - APPEAL - GENERAL PRINCIPLES - RIGHT OF APPEAL - NATURE OF RIGHT - SCOPE AND EFFECT OF APPEAL
Application for permission to appeal under s 71 of the South Australian Civil and Administrative Tribunal Act 2013 against orders made in the South Australian Civil and Administrative Tribunal (SACAT). On 4 March SACAT made a decision in its original jurisdiction ordering that the applicant must vacate her rental premises. The rental agency, on behalf of the landlord company, had applied for vacant possession on the basis of the applicant's abusive and offensive behaviour towards other tenants and agency employees. SACAT made an order for vacant possession within seven days on the more pragmatic basis that the applicant was in arrears of rent and had failed to make payment after a notice of breach had been served on her. The applicant then applied to SACAT to internally review the matter based, among other things, on hardship grounds. On the internal review SACAT found that in all of the circumstances, including the applicant's abusive behaviour, it would not be fair to the landlord to set aside the order for vacant possession. The applicant made an application to appeal to this Court. Leave was given for the application to be amended to an application for permission to appeal. The grounds asserted were that the service of the notice of breach was invalid, that inadequate time to vacate the premises had been given and that the applicant faced severe hardship if she was required to vacate.
Held, dismissing the application for permission to appeal:
(1) The agents for the landlord company were permitted to appear on its behalf on the basis that it was convenient in the interests of justice.
(2) The landlord company should be substituted as the respondent for the real estate agency, which had been named in the application.
(3) In deciding whether to grant permission to appeal from SACAT the ordinary principles with respect to permission for a civil appeal should be followed; namely, permission will only be granted where an appeal is reasonably arguable and the subject matter is of sufficient substance to justify consideration.
(4) The SACAT member had the benefit of seeing and hearing the witnesses and considering the corroborative evidence and it was not reasonably arguable that he made a mistake in relation to his finding that the serving of notice was valid.
(5) It was not reasonably arguable that there was any outcome error in the exercise of the tribunal member’s discretion. The member noted the various matters that favoured an exercise of the discretion in favour of the applicant but concluded that these were outweighed in the particular circumstances by the countervailing considerations in the favour of the landlord.
South Australian Civil and Administrative Tribunal Act 2013 s 70, s 71; Supreme Court Civil Rules 2006 r 22, r 27, r 286; Residential Tenancies Act 1995 s 93, s 113, s 114; Legal Practitioners Act 1981 s 21, referred to.
Galladin Pty Ltd v Aimnorth Pty Ltd (1993) 60 SASR 145; Glenauchen Pty Ltd v Circuit Finance Pty Ltd [2001] SASC 61; Mick Lucas Pty Ltd v Licensing Commissioner (1987) 45 SASR 312; Legal Practitioners Conduct Board v Colton (2012) 113 SASR 467; Fox v Percy (2003) 214 CLR 118; House v The King (1936) 55 CLR 499, applied.
Curnow v Police (2008) 100 SASR 290; R v Lutze (1936) 55 CLR 499; R v Horstman (2010) 269 LSJS 42, considered.

WORDS AND PHRASES CONSIDERED/DEFINED
"permission to appeal"

JACKSON v LEPP INVESTMENTS PTY LTD
[2016] SASC 62
Miscellaneous Appeal: Permission to Appeal

Parker J (ex tempore): This is an application for permission to appeal to this Court under s 71 of the South Australian Civil and Administrative Tribunal Act 2013 (the SACAT Act) against orders made in the South Australian Civil and Administrative Tribunal (SACAT) by Executive Senior Member Stevens on 10 March 2016. This is the first time that the Court has had to consider whether to grant permission to appeal from that jurisdiction. In the reasons that follow I set out the principles to be applied.[1]
[1] See below at [19]-[21].
Before considering the application for permission, it is necessary to deal with two preliminary issues.
Permission to appear
The first preliminary issue is whether Mr and Mrs von Minden should be given permission to appear for the respondent landlord. For the reasons that follow, I consider that the proper respondent is Lepp Investments Pty Ltd (Lepp Investments) and I have made an order to that effect.
Rule 27 of the Supreme Court Civil Rules 2006 provides that, on application by a director of a company, the Court may authorise representation of the company by the applicant director or some other director. The Court must be satisfied that the director who is to represent the company has power to bind it in relation to the conduct of the proceedings. No application was made under r 27, no doubt because of the uncertainty as to the identity of the correct respondent.
Mr von Minden is a land agent and a director of Property Link SA (Property Link), which is also an agent. Mrs von Minden, acting for Property Link, represented Lepp Investments in the proceedings before SACAT. That was authorised by s 113 of the Residential Tenancies Act 1995. I also note that s 114 of that Act permitted the agent to charge fees for providing representation in SACAT. That special provision displaces the ordinary prohibition under s 21(2) of the Legal Practitioners Act 1981 which prevents a person who is not a legal practitioner from charging a fee in relation to the provision of advice or representation in connection with legal proceedings. The special arrangements made in s 113 and s 114 of the Residential Tenancies Act do not apply in this Court. Thus, the agent can only appear in these proceedings if the Court grants permission, and even if permission is granted, s 21 of the Legal Practitioners Act would preclude any fee being charged for that service, other than reimbursement of out of pocket expenses.
The question was whether I should grant permission for the agent to appear. I have done so and I will explain my reasons for doing that. Rule 22 of the Supreme Court Civil Rules provides that a person may only be represented in proceedings before the Court by a lawyer. However, r 22(2) provides that the Court may grant permission to a person who appears personally to be assisted by another person, in other words a McKenzie friend. Nevertheless, the Court has a discretion to permit representation (as distinct from assistance) by a person who is not a lawyer if that is necessary or convenient in the interests of justice. The authority for that principle is Galladin Pty Ltd v Aimnorth Pty Ltd.[2] In exercising that discretion I have been guided by the authorities referred to in Lunn’s Civil Procedure. Before granting permission the Court must be satisfied that the person seeking to appear has proper authority to represent the party. In this instance the role of the von Mindens as agent for the landlord through Property Link SA gives them that authority to speak on behalf of the landlord and bind the landlord. Further relevant considerations are the fact that a lay advocate does not owe any duty to the Court, the extent of the lay advocate’s objectivity and the effective and expeditious conclusion of the proceedings. In the present case, none of these considerations operated against the grant of approval for Mr and Mrs von Minden to appear. The proceedings are not legally complex; they are essentially a factual dispute. Mr von Minden, and Mrs von Minden in particular, have experience in appearing before SACAT and the Residential Tenancies Tribunal. The professional conduct of a land agent is subject to regulation under the Land Agents Act 1994 and they are the legally appointed agent for Lepp Investments. For all of those reasons I granted permission for the von Mindens to appear on behalf of Lepp Investments.
[2] (1993) 60 SASR 145 at 147.
The proper respondent
The second preliminary issue which I have already ruled on is the correct identity of the respondent. Ms Jackson originally tried to file a notice of appeal in the registry naming SACAT as the respondent. The registry staff advised her that the respondent should be Property Link. However, as I have already noted, that body is actually the agent for Lepp Investments. Clearly, the correct respondent is Lepp Investments on the basis that it is the landlord under the tenancy agreement that was entered into with Ms Jackson. The party principal rather than its agent should be the defendant or respondent in a dispute about rights under a lease or tenancy agreement. While a more casual approach may be taken in SACAT, that cannot apply in this Court. I have therefore ordered that Lepp Investments be substituted as the respondent to these proceedings.
Permission to appeal
I now turn to consider the application for permission to appeal under s 71 of the SACAT Act. Before doing so, I need to state briefly the history of the matter.
Background
Ms Jackson entered into a tenancy agreement with respect to a property at Mawson Lakes on 5 June 2015 for a period of 12 months at a weekly rent of $255.00 payable fortnightly in advance. She also paid a bond of $1,530.00, which equates to six weeks rent. On 16 February 2016 Property Link, on behalf of the landlord, applied to SACAT for an order to terminate the tenancy agreement and to take vacant possession of the property occupied by Ms Jackson. The grounds stated in that application were that the surrounding tenants were frightened for their safety and wellbeing. The police had been called many times, it was alleged, due to the aggressive behaviour of Ms Jackson towards neighbouring tenants and owners. She had behaved unacceptably and used inappropriate language towards staff of the agency, visiting tradespersons and neighbours. The matter was said to be urgent because the neighbouring tenants wanted to break their leases and vacate the premises because they were frightened for their safety and wellbeing.
On 4 March 2016 the matter came on for hearing in SACAT before Mr Georgiadis. That application was supported by a number of letters and email messages from neighbours and tradespersons complaining about the conduct of Ms Jackson. Copies of a number of text messages and email messages sent by Ms Jackson were also supplied. Much of the content of those messages written by Ms Jackson was abusive and offensive and used highly inappropriate language. The agent also supplied a copy of the rent record to SACAT. Member Georgiadis did not decide the matter on the basis of the complaints about behaviour but perhaps on a more pragmatic basis simply dealt with the issue on the basis of the rent arrears. He found that a notice of breach (that is a Form 2 under the Residential Tenancies Regulations 2010) had been served on Ms Jackson on 12 February 2016 by being placed in her letterbox. He found that the notice was valid and that Ms Jackson had failed to pay the outstanding rent within the time allowed, ie by 20 February 2016. He found that this failure to pay rent had terminated the tenancy. He also noted, but did not decide upon, the allegations made about the conduct of Ms Jackson. After taking into account the evidence of non-payment of rent and the submissions of the parties, Mr Georgiadis made an order requiring Ms Jackson to vacate the premises by midday on Friday, 11 March 2016. At that time he noted that the arrears of rent would be $1,596.42 on the assumption that no further rent payments were made in the meantime.
Mr Georgiadis ordered that the bond of $1,530.00 be paid to the landlord via the agent after 11 March 2016 and that Ms Jackson must pay the further sum of $66.42 within 14 days. If she failed to pay that sum, the order was enforceable in the Magistrates Court.
On 9 March 2016 Ms Jackson applied to SACAT under s 70 of the SACAT Act for internal review of the decision made by Mr Georgiadis. She stated that the time allowed for her to vacate the property - being seven days - was too short. She also alleged that the agent had not served the Form 2 on her correctly and had merely thrown it on the footpath and not handed it to her. She also complained of bullying by the agent and stated that she would be lodging a claim for compensation with SACAT. As I explained during the course of submissions, that compensation claim is not before this Court. It is to be dealt with separately and in due course by SACAT, so it is not a matter that I can take into account today.
The application for internal review came before Mr Stevens, a senior member of SACAT, on 10 March 2016. He noted that Ms Jackson had lodged the compensation claim but, again, he recorded that that matter was not before him and needed to be dealt with separately.
Mr Stevens first dealt with the assertion by Ms Jackson that the Form 2 notice had not been served until 18 February 2016. While Ms Jackson did not dispute that finding in the notice of appeal or application for permission to appeal lodged with this Court, she did dispute it before me and I gave her leave to vary her grounds of appeal to that extent.
Mr Stevens preferred the evidence of the agent to that given by Ms Jackson. He found that the agent’s evidence was supported by the email correspondence between the parties. Mr Stevens then went on to note that s 93 of the Residential Tenancies Act provides that not more than seven days should be allowed for a tenant to vacate the premises unless the order for possession is suspended on the basis of severe hardship. Ms Jackson submitted that she would suffer severe hardship as she was required to care for her nine-year-old daughter and was unable to work due to her ill health. I note that her assertion of ill health is supported by a psychiatric report supplied in support of this appeal. She said that she was in a difficult financial position and would not be able to work for two years. She was also undergoing psychiatric or psychological treatment and was worried about her ability to get good references and to find alternative accommodation. Despite all of these matters but after taking them into account, Mr Stevens found that it would not be fair or equitable to suspend the operation of the order for possession. He noted that no rent had been paid since January and the arrears of rent were already in excess of the amount held as the bond.
Mr Stevens also took into account the documentary evidence which supported the claim by the applicant that Ms Jackson was commonly aggressive and abusive to its staff, neighbours and tradesmen who attended the property on behalf of the agent. Mr Stevens put some of that evidence to Ms Jackson and she admitted sending very offensive and abusive text messages and emails. Mr Stevens noted that these particular matters were irrelevant to the question as to whether the order for possession had been properly made by Mr Georgiadis who had simply confined himself to the rent arrears issue. Nevertheless, Mr Stevens found that the objectionable behaviour was relevant in deciding whether it was fair and equitable to suspend the operation of the order for vacant possession on the grounds of severe hardship. He found that suspension of the order would be unduly oppressive and prejudicial to the landlord and to the agent. For these reasons Mr Stevens affirmed the order made by Mr Georgiadis and dismissed the application for internal review.
On 10 March 2016 Ms Jackson filed a notice of appeal in this Court against the dismissal by SACAT of her internal review application. She also made an application for a stay. In a supporting affidavit she stated that she had been given only one day’s notice to vacate the premises. I interpret that period to run from the date of the final SACAT decision as distinct from the earlier decision of Mr Georgiadis. Ms Jackson also stated that she was suffering severe hardship due to a mental breakdown. She referred to the diagnosis of a psychiatrist, Dr Georgina Cheng, to the effect that she suffered from post-traumatic stress disorder, anxiety and depression. She stated that she had been granted bail by South Australia Police upon condition that she reside at the subject premises. She further stated that she had no hope of finding alternative accommodation in one day and that she had no support systems. She referred to another matter which I do not regard as relevant to this decision.
On 11 March 2016 Judge Bochner of this Court granted a stay of the order for vacant possession and directed that the notice of appeal be treated as an application for permission to appeal.
Principles to be applied
In deciding whether to grant permission to appeal from SACAT to this Court I consider that the ordinary principles applied when the Court decides whether or not to grant permission for a civil appeal should be followed. The over-riding principle is always the interests of justice.[3] The ordinary approach is that permission will only be granted where an appeal is reasonably arguable and the subject matter is of sufficient substance to justify consideration.[4] A failure of the first-instance decision maker to give adequate reasons will require the grant of permission.[5]
[3]    Glenauchen Pty Ltd v Circuit Finance Pty Ltd [2001] SASC 61 at [3].
[4]    Mick Lucas Pty Ltd v Licensing Commissioner (1987) 45 SASR 312 at 313-314.
[5]    Curnow v Police (2008) 100 SASR 290 at [11].
Because SACAT is a specialist tribunal with particular expertise in determining tenancy disputes, this Court must give substantial weight to its findings. For this proposition I rely on the decision of this Court in Legal Practitioners Conduct Board v Colton.[6]
[6] (2012) 113 SASR 467 at [35].
Rule 286 of the Supreme Court Civil Rules provides that, if permission is granted, the appeal is to be by way of a rehearing. An appeal by way of rehearing is effectively a trial over again on the evidence used in the Court or Tribunal below, together with such additional evidence as may be received on the appeal. The Court must independently review the evidence and carefully scrutinise the findings made at first instance. Significantly, where the matter involves a question of judicial discretion, the Court is not entitled to substitute its own decision unless an error is identified in the exercise of that discretion.
Consideration
Regrettably, Ms Jackson was more intent on argument rather than submissions. What emerged from her submissions was, firstly, a contention that Mr Stevens was mistaken in his finding as to the valid service of the Form 2 notice. Second, she also contended that she should have been allowed substantially greater than the ordinary period of seven days to vacate the premises. The third issue raised by Ms Jackson was the matter of severe hardship. I did not really need to hear her upon that as my reading of Mr Stevens’ decision is that he did accept the severe hardship point but decided against Ms Jackson on the basis that he was not satisfied that it was just and equitable in all the circumstances, given the concerns about her behaviour and her failure to pay rent for a substantial period, to allow her to stay longer in the property.
I have already referred to the grounds of appeal which set out the basis upon which Ms Jackson contends that she is suffering severe hardship. In essence the grounds are her mental illness, the need to care for her child, a lack of support systems and one other matter which I do not regard as relevant and which was not referred to in oral submissions today. The evidence of Ms Jackson’s psychiatric condition is contained in the report of Dr Cheng dated 19 January 2016, which was annexed to her affidavit. Ms Jackson also annexed to that affidavit a bail agreement with SA Police which had a condition that she continue to reside at the subject property at Mawson Lakes.

I will first deal with the question of the bail agreement. Regrettably, due to the urgency of the matter, SACAT has been unable to provide to this Court a transcript of the hearing conducted in that Tribunal, both at first instance and on appeal. Neither of the SACAT members referred to the bail issue in their reasons. Ms Jackson also did not refer to it today although it is mentioned in her application for permission to appeal. Even if Ms Jackson had raised the bail issue before Mr Stevens and earlier before Mr Georgiadis, I do not consider that the requirement under the bail agreement that she continue to reside at the Mawson Lakes address has any relevance to this appeal. It is quite clear that a bail agreement with the police cannot prevent SACAT making an order for vacant possession. The person who entered the bail agreement with the police needs to tell the police that because of an order of SACAT, or ultimately this Court, they have been required to leave the address and therefore request the police to vary the bail agreement. The bail agreement cannot stop the landlord enforcing its legal rights.
I now turn to Ms Jackson’s challenge to the finding of fact by Mr Stevens at SACAT that the Form 2 had been validly served. Applying the well-known principles in Fox v Percy,[7] I find that having had the benefit of seeing and hearing the witnesses and considering the corroborative evidence in the form of the email traffic, there is no reason to think that it is reasonably arguable that Mr Stevens made a mistake in relation to his finding on the service of notice. I therefore find that is not a basis for permission to appeal.
[7] (2003) 214 CLR 118.
The next issue is Ms Jackson’s submission that she was not given adequate time to vacate the premises. As I have already said, s 93(3) of the Residential Tenancies Act requires that an order for possession of the premises take effect on a date not more than seven days after the date of the order unless the order is suspended on the grounds of severe hardship. In that instance the period for the grant of vacant possession may be extended for a period up to 90 days if the Tribunal is satisfied that immediate possession would cause severe hardship to the tenant. The issue to be resolved if an appeal were to be permitted is whether the order granting possession to the landlord in seven days causes severe hardship to Ms Jackson. If that question is answered in the affirmative, the further questions are whether the time for vacant possession should be extended and, if so, what additional time should be allowed.
In determining whether to grant permission to appeal, it is necessary to decide whether it is reasonably arguable that SACAT erred in respect of any of the matters it was required to decide. The question of severe hardship is a matter of fact and the Court could only overturn that decision after evaluating all the relevant evidence and making proper allowance for the advantage enjoyed by the expert Tribunal when it assessed the credibility and reliability of the witnesses. If after that process the Court was satisfied that the finding was not consistent with uncontested evidence or incontrovertible facts, was glaringly improbable or was contrary to compelling inferences, as decided by the High Court in Fox v Percy, the Court might depart from the finding of fact made below.
Given my reading of Mr Stevens’ decision that he did apparently accept that severe hardship was present, although he did not expressly say so, it is unnecessary to dwell on the severe hardship ground. The issue then becomes the appropriateness of the exercise of the discretion undertaken by Mr Stevens in deciding not to extend the time for vacant possession beyond seven days. That was a judicial discretion and in determining an appeal I am required to apply the well-known principles set out by the High Court in House v The King.[8] Mr Stevens exercised his discretion against Ms Jackson on the basis that it would be unduly oppressive and prejudicial (or, as he said at another point, not fair and equitable) to the landlord and the agent if he were to suspend the order for possession.
[8] (1936) 55 CLR 499.
As the Full Court noted by majority (Vanstone J and myself) in R v Lutze,[9] and as the Chief Justice had previously observed in R v Horstman,[10] a House v The King error may arise either because there has been a process error or an outcome error. An error of either type can lead to the setting aside of the exercise of judicial discretion. The question therefore arises whether it is reasonably arguable, this being an application for permission to appeal, that the taking into account by Mr Stevens of the prejudice to the landlord and agent was not a permissible and relevant consideration in the exercise of his discretion whether or not to extend time for possession.
[9] (2014) 121 SASR 144 at [45]-[46].
[10] (2010) 269 LSJS 42.
I do not consider it reasonably arguable that these considerations are not relevant. The scheme of the Residential Tenancies Act seeks to strike a balance between the often competing interests and rights of landlords and tenants. In my firm opinion, it could not reasonably be argued that admitted egregious behaviour by a tenant and a very substantial arrears in rent payments that exceed the amount held under the bond were not relevant to the exercise of the discretion to extend time. If that were not the case, the position would be that a tenant could fundamentally flout their obligations under a tenancy agreement but that matter could not be taken into account by SACAT once it found that eviction after seven days would cause the person severe hardship. For that reason I do not consider it reasonably arguable that there was any process error made by Mr Stevens in the exercise of his discretion under s 93(4).
I turn to the question of whether it was reasonably arguable that Mr Stevens’ decision displayed an outcome error. In considering that matter it is necessary for me to take into account that the discretion was exercised by a senior member of an expert Tribunal that deals with over 10,000 tenancy disputes each year. Mr Stevens noted the various matters that favoured an exercise of the discretion in favour of Ms Jackson but concluded that these were outweighed in the particular circumstances by the countervailing considerations in the favour of the landlord. I do not consider it reasonably arguable that there was any outcome error. It is not relevant that some other person might take a different view. The fact of the matter is that I must give due deference to Mr Stevens’ decision. In that context I note that the purpose of an appeal by way of rehearing and after considering any further evidence that may be admitted is to determine whether any error has been made. Mr Stevens was within the reasonable exercise of his discretion to refuse to extend the time for possession.
Conclusion
I have found that the grounds of appeal advanced by Ms Jackson are not reasonably arguable. In my view, Ms Jackson in her submissions today was merely seeking to reargue the matters decided against her by Mr Stevens in SACAT. That is not a basis for this Court to grant permission to appeal. I therefore refuse permission to appeal. I further note that if the grant of permission was not required by the legislation, I would have dismissed the appeal in any event.