LAROSA v Savage
[2007] SADC 105
•15 October 2007
DISTRICT COURT OF SOUTH AUSTRALIA
(Civil: Appeal Under Residential Tenancies Act 1995)
LAROSA v SAVAGE
[2007] SADC 105
Judgment of His Honour Judge Tilmouth
15 October 2007
LANDLORD AND TENANT
Residential Tenancies Act - appeal from order of Tribunal allowing tenant's claim for compensation - appeal upheld - award moderate as either compensatory or monetary sum.
Residential Tenancies Act ss 41, 68 and 110(c), referred to.
Doherty v Sulley and Suens Judgment No. D3858 3 August 1998; Knueppel v Zarpas [2004] SADC 162, November 2004; Gration v C Gillan Investments Pty Ltd [2005] QCA 184, applied.
LAROSA v SAVAGE
[2007] SADC 105These proceedings comprise a landlord’s appeal against a decision of the Residential Tenancies Tribunal dated 17 November 2006.
A Residential Tenancy agreement as between the landlord (Appellant) on the one hand and the tenant (Respondent) on the other hand, was executed on 9 July 2006 with respect to the residential premises situated at 68 Swan Street Grange in the state of South Australia. The agreement was endorsed in the handwriting of the respondent, noting a bond of $880.00, rent in advance of $440.00: a total of $1320.00. This was countersigned by the appellant on the same day.
There is no dispute the rent was paid in advance as contemplated or that a further sum of $220.00 was paid by way of rent with respect to the period 18 July to 25 July 2005. Payments of rent were regularly made thereafter until a final transfer of $220.00 on 14 November 2006,[1] thus bringing the period for which rental was duly paid during the course of the agreement to 21 November 2007. Nor is there any disagreement between the parties as to the payment of the bond in accordance with the endorsement, as confirmed by the security bond receipt lodged with the Office of Consumer and Business Affairs on 8 January 2007.
[1] T51 L21
The agreement went on to provide for a term of 24 months commencing from 18 July 2006, at a weekly rental of $220.00 per week, payment to be made on the Tuesday of each week. Otherwise the written agreement was in the standard form save only for three “additional conditions” inserted in hand writing, otherwise immaterial to the present proceedings.
The order in contention is one requiring the landlord to pay to the tenant the sum of $1,300.00, pursuant to s110(c) of the Residential Tenancies Act 1995 (SA) (“the Act”). The components of that were made up of $340.00 compensation for distress and inconvenience for being “left without any hot water in the middle of winter for a period of 16 days”,[2] $100.00 compensation with the respect to “various leaks with taps...[and]...lack of use of laundry cupboard and bathroom cabinet due to damp”,[3] $300.00 “compensation for her discomfort, inconvenience and distress caused” by a toilet blockage and an associated large hole on the back verandah concrete,[4] $85.00 spent by the tenant to fix a window screen and replace a back door screen[5] and finally $200.00 for “the inconvenience, stress and discomfort experienced by her due to the state of the gardens and yards”.
[2] Reasons p 4 para 1
[3] Reasons p 4 para 2
[4] Reasons p 4 para 4
[5] Reasons p 4 para 6
The Tribunal proceeded to order “as to the method of payment...the tenant may withhold the sum from future rent payments”. There was also an order made pursuant to s89(1)of the Act terminating the agreement and permitting possession to be resumed by no later than 12 noon on Thursday 25 January 2007. In the result this is uncontentious. The respondent in fact vacated the premises on or about 22 December 2006, but otherwise neither party seeks any consequential order with respect to that.
The Tribunal heard evidence from both parties and made the following primary findings of fact:
·there was a brief internal inspection of the premises at which the tenant noticed the age of the air conditioner and the gas heater and was assured they were working effectively;
·due to the presence of a “large angry dog” no inspection of the rear garden or side of the house took place; the tenant could however see that it was untidy with rubbish and belongings heaped about;
·upon taking occupancy on 18 July the premises were left in a “totally filthy state” which were cleaned by the tenant without notification to the landlord;
·the landlord was notified on 19 July 2006 that there was no hot water; he advised the tenant he would “see to it” but it was not until six days later that a maintenance person first attended; it was not finally repaired until the evening of Friday 4 August 2006, sixteen days after first reporting the defect to the landlord;
·since July 2006 the inside toilet blocked completely once per week; the tenant advised the landlord of this problem.
The gravamen of the appellant’s case is that he was given no prior notice of these defects save with respect to the hot water service. He complained that had he been duly notified he would have arranged for his own people or tradespersons to remedy them. He did concede the plumber called in to repair the hot water service had “let him down”.[6] No doubt this led, as the Tribunal below found, the tenant “to have little faith in the qualifications” of the plumber to carry out repairs.
[6] T16 L13
The question whether there was a complete inspection of the premises in the first place, is of itself of little significance. Section 68 of the Act imposes an objective minimum standard on the landlord, irrespective of the state of knowledge of the prospective tenant, to ensure the subject premises were “in a reasonable state of repair at the beginning of the tenancy.” The landlord was further obligated to “keep them in a reasonable state of repair” during the course of the tenancy. A landlord is not in breach of the latter obligation unless having been given “notice of the defect requiring repair” he fails “to act with reasonable diligence to have the defect repaired”: s68(2)(a) of the Act.
The question of the appellant’s prior knowledge of the respective defects, and the orders for compensation on which they are based, is therefore the critical issue. The appellant also complained that the Tribunal in making the orders concerned, did not turn its mind, as it was required, to s68(3) of the Act concerning the obligation of the tenant to notify him of the state of disrepair or make a reasonable attempt to do so: s68(3)(c) and that the state of disrepair must in any event be “likely to result in personal injury or damage to property or under inconvenience”: s68(3)(b).
On appeal this court is entitled to re-hear evidence taken before the Tribunal or to take further evidence as it sees fit: s41(2)(a). The court must “give due weight to the decision being appealed against and the reasons for it and not depart from the decision except for cogent reason”: s42(E)(3) District Court Act 1991 (SA)
No transcript or note of the evidence taken before the Tribunal is available. As the court is not bound by the rules of evidence and may inform itself as it thinks fit, acting on the substantial merits of the case: s42(E) District Court Act (above), the court determined to receive submissions from both parties without requiring them to give formal evidence. They acknowledged the submissions put forward were understood to be warranting the truth of the assertions which each of them respectively made before the court.[7] Both parties were afforded the opportunity of giving sworn evidence, but preferred to dispose of the matter in this way.
[7] T2 L35-T5 L17, T54 L7-L35
It is convenient to deal with each item making up the total component of $1300.00 damages individually, in light of the requirements of the Act summarised above. As mentioned, the finding of the Tribunal was that there was an internal but no external examination of the subject premises, before entry into the lease. The appellant says there was an examination of both. All this seems to be very much beside the point in view of the objective requirements of the Act mentioned above. Although it may well have been that the respondent noticed the age of the air conditioning unit and the gas heater at that time, this was hardly requisite notice to the landlord of the kind required by either of the two subsections of s68.
When it comes to the hot water service, the respondent claims this was first noticed on the day after taking possession. This is disputed by the appellant, but he does not contest that there were at least eight to ten days without hot water.[8] The finding of the Tribunal, as noticed, was that there was a lack of hot water for 16 days before it was ultimately remedied.
[8] T17 L8-L9
The fact remains that for a period of not less that eight days, the respondent was left without hot water in circumstances where she had to cater for her two young children and a sub-tenant, Miss Belette. On any view such a significant deficiency ought to have been rectified, as the Tribunal said “within four to five days” and if not, in view of the court, much more promptly than that. The provision of hot water for conventional domestic uses, is a basic necessity of everyday living.
In those circumstances whatever the actual period for which the hot water was not functioning, $340.00 by way of compensation was a very modest award indeed. Given that the landlord concedes having received notice of the problem within the meaning of s68(2)(a) and having failed to act with reasonable diligence to have the defect repaired,[9] the Tribunal was fully entitled to make an order pursuant to s110(c) for the making of a compensatory payment. Proof of likely injury, damage or inconvenience in terms of s68(3) of the Act was unnecessary, since there was already a proven contravention of s68(2). Section 68(3) applies to additional defects falling short of a contravention under ss68(1)&(2), which are likely to result in the requisite injury, damage or inconvenience, following due notice. That being so, the Tribunal was strictly not required to consider s68(3) when it came to the hot water service.
[9] T16 L11-T12 L6
In any event the failure to ensure the provision of hot water for no less than eight days, plainly caused “undue inconvenience”. Since notice is admitted, the provisions of s68(3) were satisfied in this instance. The award of compensation relating to the lack of hot water facility of $340.00 is therefore upheld, as a very modest assessment of the physical inconvenience caused by the landlords breach of the tenancy agreement: Doherty v Sully and Suens.[10]
[10] DCCIV – 98-186, judgment no. D3858
Next the Tribunal turned its attention to various leaking taps, the major inconvenience being an inability to use a laundry cupboard and bathroom cabinet, due to damp conditions. In the result this was not seriously disputed by the landlord. No specific finding was made in the Tribunal below as to notice being given about this issue. The respondent in this court, referred to numerous calls to the landlord:[11]
HIS HONOUR: You say, do you, you rang him about each of these various complaints that you had?
MS SAVAGE: Yes. On several different occasions from different phones, from different numbers, we had many conversations. In the first instance it was ‘Yes, I’m sorry, I’ll get someone to look at them’, ‘I’ll bet back to you’, I’ll have a look at it’, then the more persistent I became the more – things deteriorated very rapidly.
[11] T52 L37-53 L7
There is no reason to think that she would not have brought these problems to the attention of the landlord in conjunction with the other complaints.[12] They followed installation of the water heater and the failure to remove the old one which leaked.[13] The individual sum fixed has to be viewed in the larger context, which suggests, this too is a modest amount.
[12] T18 L6-L8
[13] T36 L4-L9
Then the Tribunal turned its attention to the air conditioning. It found the landlord “had notice of this from the start of the tenancy and was fully aware that it had not been serviced for a considerable period of time”. Presumably this finding is based on the inspection of the house. That was hardly notice of a defect in terms of the Act. It appears on all accounts that the air conditioning unit was somewhat aged. It fell into need of repair, carried out by Ms Savage on her own initiative at a cost of $275.00, the amount allowed by the Tribunal on 26 October 2006. It was not seriously suggested by the appellant that this was unreasonable.[14] In the scheme of things it appears to be a relatively small amount for the repair of an air conditioning unit, bearing in mind call out fees which are usually charged these days.
[14] T23 L9-L14
That being so, irrespective of whether there was a breach of the agreement under s68(2) and irrespective of whether or not this situation was likely to result in “undue inconvenience”, it was open to the Tribunal to allow the $275.00 as reimbursement, or a non-compensatory ‘payment’ pursuant to s110(c). Still further, being left without heating during the middle of winter, clearly constitutes undue inconvenience, but that of course of itself would not be enough to trigger the operation of s68(3) without proof of due notification of the state of disrepair.
Nevertheless the court considers that circumventing notice to the landlord in order to get the job done in view of the history of the dealings between the parties, and in view of the fact that by that time the relationship between the parties led to a “stand off” and later “had completely broken down”, was reasonable both in terms of action and in terms of the sum expended. In those circumstances this component of the award is also upheld.
The next topic of dispute was the toilet blockage and the associated large hole in the back verandah. That this condition existed is conclusively demonstrated by the photographs submitted by the tenant. The tenant was told as the landlord frankly admitted - even though the occasion was not precisely identified by either party - that the problem had existed for some time and that the toilet had been “snaked out” a number of times in the past.[15] The landlord was therefore aware of the condition prior to the tenancy. It is not difficult to accept that a blocked toilet would cause considerable inconvenience, or that it was an unpleasant job to manually unblock with a plunger at least once a week. It is equally difficult to imagine why the tenant would not notify a landlord of such a chronic situation and suffer it in silence. It is inconceivable that the respondent would not have contacted the appellant about this problem. She had ready access to both his mobile and landline telephone numbers.[16]
[15] T21 L9–L20, T57 L37–L58
[16] T48 L10-19
It follows there is no difficulty at all in concluding that the appellant must have been given notice of the condition of the toilet, whether that notice comes within the meaning of s68(2)(a)(i) or s68(3)(c), so that those prerequisites have been made out. It is clear from the photographs that the situation was not remedied. Bearing in mind there were two females and two young children in the house, this was an undue inconvenience and the unhygienic condition might well have presented the prospect of sickness to the occupants. Even though the Tribunal did not turn its mind to s68(3), that element of inconvenience was inherently satisfied on the basis of these facts. The order for payment of compensation of $300.00 will therefore be upheld; once again the court considers that to be a most modest assessment in the circumstances.
Then there was the issue of window screens and rear screen door. It is not at all clear that the landlord was given notice of these. Ms Savage asserted the screens were installed as a security measure. The rear door screen clearly appears (as the Tribunal found) in the photographs submitted by her. The sum of $85.00 claimed by her, although not supported by documentary evidence, was open to the Tribunal to accept. This sum appears to be an extremely cheap price for these items. On that basis it was open to fix that sum as a reasonable payment pursuant to s110(c) of the Act, irrespective of any question of contravention and irrespective of proof of the other matters set out in s68(3). This part of the award will therefore be upheld on that limited basis.
Finally there is the compensation of $200.00 for the “inconvenience, distress and discomfort experienced due to the state of the gardens and yards” to consider. The photographs certainly prove the state of affairs to be present when they were taken around the 4th or 5th of August.[17] The appellant effectively conceded the condition of the external areas depicted in those photographs were substantially in the same condition when possession was first taken by the respondent back on July 18.[18] Anyway he must be taken to be aware of the condition of this state of affairs, either because he admits inspecting the yard or alternatively because it was in such a state of disrepair “which an inspection would reveal to a reasonable observer”: Knueppel v Zarpas,[19] Gration v Gillan Investments Pty Ltd.[20]
[17] T56 L27–L35
[18] T57 L2 – L36, T58 L32, T59 L31
[19] [2004] SADC 162 at [40]
[20] [2005] QCA 184 at [11]
Given those considerations, there can be no doubt that the state of the external premises, as known to the appellant at the time the respondent moved in and thereafter, were never in reasonable repair within the meaning of ss68(1)& (2) or that they caused undue inconvenience, or that they were likely to result in injury, particularly to children playing there. In that state of affairs $200.00 was barely sufficient compensation at all.
The upshot is that no ‘cogent reason’ has been shown justifying setting aside or varying the order for compensation made by the Tribunal, or as to any of the individual components making it up. In any event reviewing the matter afresh, the court finds the award to be relatively favourable to the appellant in the proved circumstances of the case. The appellant’s claim that he received no notice of the later defects flies in the face of the pattern of complaint established over the hot water service issue, is inherently extremely unlikely and enabled him to avoid the trouble and inconvenience – and perhaps even the additional costs – of organising the repairs himself. The respondent’s version of events on the other hand is intrinsically far more likely, is consistent with the photographs and the objective facts and is supported by her letter to the Tribunal of 27 October 2006, with the landlord’s admission that the respondent “came several times to my restaurant and we discussed a few bits and pieces”,[21] and to a lesser extent with the telephone records produced by her. Even though the rent charged may to an extent reflect the run-down state of the subject premises, that provides no defence to a contravention of s68(1) or s68(3).
[21] T20 L35-L38
There remain two outstanding matters for consideration. The first is that the appeal being dismissed, renders the appellant liable to pay the sum of $1,300.00 to the respondent. As against that the respondent acknowledges currently owing $1,540.00 in outstanding rent to 22 January 2007,[22] plus a further two days to bring it in line with the Tribunal’s order terminating the lease as of 25 January 2007 of $60.00, so her present liability to him is $1,600.00.[23] As the Tribunal effectively facilitated a set-off, one against the other, the balance of monies due is $300.00 by her to him. This court should in fairness order likewise.
[22] T50 L12–L17
[23] T71 L16
The second matter relates to the bond of $880.00 presently lodged with the Tribunal. Although the appellant claimed the premises were vacated in a dirty and untidy condition,[24] that was not apparently a matter raised by him earlier. More to the point, it remains for the respondent to bring an application for the payment to her of the whole amount of the security under s63 of the Act. Accordingly this court is unable to further facilitate a final resolution of all matters outstanding as between the parties.
[24] T65 L2–L8
Before entering final orders it remains to mention the question of costs. Ordinarily in appeals of this kind, no order as to costs is made unless “such an order [is] necessary in the interests of justice”: s42G District Court Act (above). No apparent reason for ordering costs in favour of or as against either party has emerged so far, but since they were not asked to address the question, they should be given leave to file written submissions with respect thereto before a final order on that score is made.
The formal order of the court therefore is that the appeal against the decision of the Residential Tenancies Tribunal of 15 November 2006 is dismissed and the orders made therein are affirmed. There will be an order that the respondent pay the appellant the balance of $300.00, but that order is stayed pending resolution of the disposition of the security bond presently retained by the Tenancy Tribunal. There will be a further order that the plaintiff have leave to file written submissions (if any) in relation to the appropriate order for costs other than an order that there be no order to costs, by Monday 22 October 2007 and that the respondent have leave to file a written submission in response thereto by no later than 4.30pm on Monday 29 October 2007.
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