Mainore Pty Ltd and Hilyard (RT 12/452); and; Hilyard and Mainore Pty Ltd (RT 12/649); (Residential Tenancies) - [2012] ACAT 75

ACT CIVIL & ADMINISTRATIVE TRIBUNAL

MAINORE PTY LTD & HILYARD (RT 12/452)
and
HILYARD & MAINORE PTY LTD (RT 12/649)
(Residential Tenancies) [2012] ACAT 75
Case Number:           RT 12/649; RT 12/452
Catchwords:             RESIDENTIAL TENANCIES – whether notice of intention to terminate tenancy was valid – whether notice of intention to terminate tenancy was accepted by the lessor’s agent – early termination of tenancy agreement – compensation for lost rent –abandonment of tenancy – mitigation of loss
List of legislation:     Residential Tenancies Act 1997, ss. 36, 38, 43, 45, 46, 58, 60, 61, 62 and 84, and Division 3.4, and previous section 104, and prescribed terms 52, 60, 84, 85, 90(a) and 91
List of cases:             Fresh Express Australia Pty Ltd v Larridren Pty Ltd
[2002] FCA 1312

Karacominikas v Big Country Developments Pty Ltd
[2000] NSWSCA 313

Kiem Dang Investment Pty Ltd v Jewel Food Stores Pty Ltd & Ors
[2009] NSWSC 870

Maridakis v Kouvaris (1975) 5 ALR 197
Young v Lamb (No 2)
[2001] NSWSC 1014

List of Texts/Papers: Explanatory Memorandum to the Residential Tenancies Bill 1997
Community Law Reform Committee of the Australian Capital Territory, Report No 8, Private Residential Tenancy Law (1994),
Contract: General Principles: the Laws of Australia (2006), edited by JLR Davis.

Tribunal: Ms E. Symons, Presidential Member

Date of Orders:           8 November 2012
Date of Reasons for Decision:       8 November 2012
AUSTRALIAN CAPITAL TERRITORY  )
CIVIL AND ADMINISTRATIVE TRIBUNAL )          NO: RT 12/649, RT 12/452

KATHERINE HILYARD

Tenant/Applicant (RT 12/649)

Tenant/Respondent (RT 12/452)

MAINORE PTY LTD

Lessor/Respondent (RT 12/649

Tenant/Applicant (RT 12/452)

CORRECTION OF ERROR
Tribunal                  :Ms E.S Symons
Date:          8 November 2012
Correction:          4 April 2013

Pursuant to section 63 of the ACT Civil & Administrative Tribunal Act 2008 (ACT) the order of the Tribunal in these proceedings dated 8 November 2012 is amended as follows:
In Paragraph 2

1. Delete the words: “The Applicant” and replace with “Katherine Hilyard”;
2. Delete the words: “The Respondent” and replace with “Mainore Pty Ltd”.
.....................................................
Ms E. Symons

Presidential Member
IN THE ACT CIVIL & )
ADMINISTRATIVE TRIBUNAL ) FILE NUMBER
RT 12/649
RT 12/452

KATHERINE HILYARD

Tenant/Applicant (RT 12/649)

Tenant/Respondent (RT 12/452)

MAINORE PTY LTD

Lessor/Respondent (RT 12/649

Tenant/Applicant (RT 12/452)

Tribunal: Ms E. Symons, Presidential Member
Date: 8 November 2012

ORDER
1.The Applicant’s Application in proceedings RT 12/649 is dismissed.
2.Within 28 days the Applicant pay compensation to the Respondent in RT 12/452 in the sum of $17,200.
Ms E. Symons
Presidential Member
ACT Civil & Administrative Tribunal
DECISION

Background

Ms Katherine Hilyard (“the Applicant”) signed a lease to rent the premises at 7/110 Giles Street, Kingston (“the unit”) from Mainore Pty Ltd (“the Respondent”). The lease was signed by the parties on 26 November 2010 and was for a fixed term of 104 weeks from December 2010 to December 2012. The rent payable was $950 per week for the period 6 December 2010 to 6 December 2011 and $1,000 per week from 7 December 2011 for the remainder of the term. The managing agent for the unit was Peter Blackshaw Manuka (“the Agent”). The unit was in the complex known as “Pearl”.
The Applicant vacated the unit on 27 April 2012.
On 8 June 2012, the Applicant filed the Application for Resolution of Tenancy Dispute in these proceedings. The nature of the relief sought in this Application is stated as “That the lease be terminated as at 27 April 2012 and that the bond be returned.”
The Respondent filed its Response on 31 July 2012 in which it stated that the matter had already been heard on 23 May 2012 in proceedings RT 12/452; an order was made that the Office of Rental Bonds release the full bond to the lessor’s agent, and liberty had been given to either party to relist before President Stefaniak for any further end of lease issues after a tenant has been found. The Respondent further stated “No replacement tenant has been found at this stage despite the agency showing the property over 30 times.”

The Hearing

The Application was heard on 20 September 2012. Mr Guy Forsyth represented the Applicant pursuant to the Power of Attorney. Mr Mark Flint, Solicitor, from Meyer Vandenberg, had lodged a Notice of Representation for the Respondent on 18 September 2012 and he appeared for the Respondent at the hearing.
The Applicant gave evidence by telephone and was cross examined by Mr Flint. Ms Eleanor Earley, the Agent’s property manager, and Mr Josip Zivko, Director of the Respondent, gave evidence and were cross examined by Mr Forsyth. The following documents were marked as Exhibits:
·Power of Attorney from the Applicant to Mr Forsyth dated 18 September 2012 – Exhibit A1.
·Email from Eleanor Earley to the Applicant dated 15/04/2012 – Exhibit A2.
·Emails from Eleanor Earley to Applicant dated 13/04/10 and from the Applicant to Eleanor Earley dated 14 December 2010 – Exhibit A3.
·Bundle of Documents including copies of “Managing Agents Agreement”; the Residential Tenancy Agreement between the Respondent and the Applicant; emails between the Applicant and the Managing Agent; inspection reports,; print out of “Open Times” of the subject unit from 12 April 2012 and 15 September 2012; exhibition register records; action and conversation diaries; emails from Sonja Mikic, the Agent’s Leasing Consultant; listing on ‘allhomes.com.au’; chronology of renting efforts and comparable rentals; and six photos of lock key and storage cage – Exhibit R1 Part A.
·Bundles of emails between Eleanor Earley and the Applicant and copy of note left on windscreen of car in basement 17.1.12 – Exhibit R1 Part B.
·Two sheets numbered 13 and 37 of 66 sheets entitled Units Plan 3487 – Exhibit – R2.
At the conclusion of submissions the Tribunal directed that Mr Forsyth lodge and serve written details of the compensation claimed by the Applicant by close of business 28 September 2012 and that the Respondent lodge and serve any Response by close of business 5 October 2012. The Tribunal reserved its decision.
Mr Forsyth provided the following details of the tenant’s liability for 7/110 Giles Street should the Applicant’s termination application not succeed:
“... This calculation based on Residential Tenancy Act maximum liability of tenant of 25 weeks which does not occur until 18 October 2012 or until a new tenancy occurs. As such, a determination of costs can only occur on or after 18 October 2012 once it is ascertained whether the property has been tenanted prior to that date.
The following calculations are based on the landlords (sic) general duty to mitigate the loss of the tenant under s. 38 RTA, and the requirement for the landlord to take genuine and reasonable steps to resolve the dispute.
Assumptions:
As stated in submissions the rental rate of $900 is based on the fact that:
(i)This rental rate is more realistic given the actual (reduced) rental conditions in the market; and
(ii)An “identical” property in the same apartment in the Pearl apartment complex at 6/57 Eyre St (with park views) let for $900 per week on 12 July 2012
(iii)President Stefaniak has indicated that the loss of use of the storage cage would amount to a 5% reduction in rent paid and payable.
Option 1
Landlord mitigates the tenants loss by offering the tenant the option to pay the difference between the (unrealistic an(sic) unachievable) $1000 per week rental and $900 per week rate.
25 weeks at difference between $1000 and $900             $2500
Less Bond already paid  $3800
Less 5% deduction for cage:
Rent paid at $950 per week for period 26/11/10-26/11/11
= 52 x $950 x 5%      =   $2470
Rent paid at $1000 per week for period 27/11/11-27/4/12
= 22 x $1000 x 5% =   $1100
Rent liability for 25 weeks = 25 x $100 x 5% =  $ 125
Net  $3625
Less 2 weeks rent for failure to advertise until 5 April 2012          $2000
Gross payment owing to tenant  $6,925
Option 2
Landlord advertises property at the more realistic rate of $900 per week (as per assumptions)) and charges the tenant full rental for the 25 week period. The tenant submits that at this rate the property is likely to rent in less than 3 months given that 6/57 Eyre St (the mirror image of 7/110 Giles) rented in that period for the same rent
25 weeks at $900 per week rental  $22,500
Less Bond already paid  $ 3,800
Less 5% deduction for cage:
Rent paid at $950 per week for period 26/11/10-26/11/11
= 52 x $950 x 5%     =   $2470
Rent paid at $1000 per week for period 27/11/11-27/4/12
= 22 x $1000 x 5% =   $1100
Rent liability for 25 weeks = 25 x $100 x 5% =  $ 125
Net  $3625
Less 2 weeks rent for failure to advertise until 5 April 2012  $2000
Less Tribunal discretion to reduce for failure to reasonably resolve
= 1 month rental  $4000
Gross payment owing to landlord  $9075
Note: Given that the tenant has already made an offer to resolve this matter on 99/99/12(sic) at an amount greater than both options then the tenant also claims the cost of lost income for the representation by Mr Forsyth of $1208 per day plus GST = $1320.80”
The Respondent submitted that the Applicant had not made out a basis for termination of the lease and that the Respondent was not liable to pay any money to the Applicant.
The Respondent also submitted that the termination arose by the Applicant’s abandonment of the premises and that the Applicant should be liable for compensation calculated as follows:
Lost rent 27 April 2012 to 4 December 2012
(31 weeks x $1000)  $31,000.00
Less bond  $ 3,800.00
$27,200.00
Damages capped at 25 weeks at $1,000
pursuant to subsection 62(3)(a) RTA)  $25,000.00

Issues

The Applicant identified the issues in dispute in the Application as:
“1. The tenancy was induced by a false or misleading statement by the lessors (sic) agent) s.43 RTA)
2. The lessor breached the lease clauses 52 and 60 by failing to rectify a situation which interfered with the reasonable habitation of the tenant under s.43 of the RTA
3. The lessor expressly or impliedly gave notice to the tenant to vacate and the tenant had a reasonable expectation that the landlord has an intention to cause injury per ss.58 & 45 of the RTA”
Having considered the issues identified by the parties the Tribunal considers that the issues for determination are as follows:
·Whether the Applicant’s lease should be terminated as at 27 April 2012? This involves a consideration of the following:
i.Whether the Applicant’s tenancy was induced by a false or misleading statement by the Respondent’s Agent.
ii.Whether the Respondent breached clauses 52 and 60 of the Standard Residential Tenancy Terms.
iii.Whether the Respondent expressly or impliedly gave notice to the Applicant/tenant to vacate.
iv.Whether the Respondent engaged in conduct intended to cause injury to the Applicant or members of her family.
·Whether the Applicant had given the Respondent a valid notice to terminate, and, if so, whether the notice had been accepted by the Respondent.
·Did the termination arise by the Applicant’s abandonment of the premises.
·Whether compensation is payable and if so, in what amount. This involves a consideration of whether the Respondent mitigated the loss.

Applicable law

The Applicant relies on section 43 of the Residential Tenancies Act 1997 (RT Act) which relates to breaches of standard residential tenancy terms and, upon application by a tenant, this Tribunal (ACAT) having the power to terminate a residential tenancy agreement. Section 43 states:
43 (1) On application by a tenant, the ACAT may terminate a residential
tenancy agreement if satisfied that—
(a) the lessor has breached the standard residential tenancy terms;
and
(b) the breach of the standard residential tenancy terms was not in
accordance with a term of the residential tenancy agreement
endorsed by the ACAT; and
(c) the breach justifies the termination of the tenancy.
(2) If—
(a) the ACAT decides to terminate a residential tenancy agreement
in accordance with subsection (1); and (b) the ACAT is satisfied that—
(i) the tenant would suffer significant hardship if the
agreement were not terminated within 2 weeks after the
making of the decision to terminate; and
(ii) that hardship would be greater than the hardship the lessor
would suffer if the tenancy were terminated within
2 weeks after that day;
the ACAT must order that the agreement be terminated at a
specified time within 2 weeks after the making of the decision to
terminate the tenancy.
(3) If—
(a) the ACAT decides to terminate a residential tenancy agreement
in accordance with subsection (1); and
(b) the ACAT is not satisfied in relation to the matters mentioned
in subsection (2) (b);
the ACAT must order that the agreement be terminated at a
specified time not less than 2 weeks after the making of the decision
to terminate.
The Applicant particularised the breaches relied upon as breaches of clauses 52 and 60 of the Standard Residential Tenancy Terms (“SRTT”). Clause 52 relates to the tenant’s use of the premises without interference and Clause 60 relates to urgent repairs in relation to the premises or services or fixtures supplied by the lessor.
The Applicant also relies on the general duty to mitigate in section 38 and on sections 45, 46 and 58 of the RT Act.
Section 38 states:
A person who, apart from this section, would be entitled to
compensation under this Act is not entitled to the compensation, or
part of it, if the loss, or part of the loss, to be compensated could
have been reasonably avoided..
Section 45 relates to damage, injury and intention to damage and injure and states:
On application by a tenant, the ACAT may terminate a residential
tenancy agreement effective immediately if satisfied that the lessor has intentionally or recklessly caused or permitted, or is likely to so
cause or permit—
(a) serious danger to the premises or to property of the tenant; or
(b) injury to the tenant or a member of the tenant’s family.
Section 46 relates to false or misleading statements by the lessor and states:
On application by a tenant, the ACAT may terminate a residential
tenancy agreement if satisfied that the agreement was induced by a
false or misleading statement of the lessor.
Section 58 relates to a defective lessor’s termination notice if the tenant vacates. It states:
1) If—
(a) a lessor purports to serve a termination notice on a person;
(b) the form is not in the form approved under section 133 (Approved forms—Minister) for a termination notice or served as prescribed by regulation; and
(c) the person vacates the premises in accordance with the notice;
the residential tenancy agreement terminates on the day the person vacates the premises.
(2) A former tenant who vacated premises in accordance with a termination notice that was not in the form approved under section 133 (Approved forms—Minister) for a termination notice may apply to the ACAT for the following orders:
(a) an order for compensation for wrongful eviction;
(b) an order for reinstatement as tenant in possession of the premises.
(3) The ACAT must not make an order mentioned in subsection (2)(b) unless—
(a) the premises are vacant and have not been leased; and
(b) the ACAT considers it appropriate to do so.
The Respondent alleges that the Applicant abandoned the premises at 7/110 Giles Street, Kingston and relies on sections 60, 61 and 62 of the RT Act which state-
60.(1) If a tenant purports to serve a termination notice on a lessor and
vacates the premises in accordance with the notice, even though the
notice is not in the form approved under section 133 (Approved
forms—Minister) for a termination notice—
(a) the residential tenancy agreement terminates on the vacation of
        the premises in accordance with the notice; and
(b) the former lessor may apply to the ACAT for compensation for
the tenant’s abandonment of the premises.
(2) The ACAT must award compensation to a person who makes an
application mentioned in subsection (1) (b) unless satisfied that the
     person was not in a significantly worse position because of the
     defect in the notice than the person would have been had the notice
been in the approved form.
61.If a tenant abandons premises that the tenant occupies under a
residential tenancy agreement, the agreement terminates on the day
of abandonment.
62. (1) If a tenant abandons premises before the end of a fixed term
agreement, the former lessor may apply to the ACAT for the
following compensation:
(a) compensation for the loss of the rent that the former lessor would    have received had the agreement continued to the end of its term;
(b) compensation for the reasonable costs of advertising the premises for   lease and of giving a right to occupy the premises to another person.
(2) On application, the ACAT may award compensation of the kind
     mentioned in subsection (1) (a) and (b).
(3) The amount of compensation the ACAT may award—
(a) under subsection (1) (a) must not exceed an amount equal to
25 weeks rent; and
(b) under subsection (1) (b) must not exceed an amount equal to 1 week’s   rent.
(4) In deciding the amount of compensation that may be awarded under
subsection (2) in relation to costs, the ACAT must have regard to
when, apart from the abandonment of the premises—
(a) the agreement would have ended; and
(b) the lessor would have incurred the costs mentioned in
subsection (1) (b).

Consideration

The Tribunal will, firstly, consider the issues raised by the Applicant and the evidence before the Tribunal.

Whether the Applicant’s tenancy was induced by a false or misleading statement by the Respondent’s agent

The Applicant told the Tribunal that after she signed the lease on 26 November 2010 and received the keys she found that none of the keys provided opened the unit’s cage or storage area. She had rented the unit as it had three bedrooms, two living areas, two car spaces and ample storage. The storage cage was very important to her as she had come from a much larger place with a three car garage and she would not have taken on the lease if she had realised that the storage cage was not part of the leased property. She had spoken to Lyn McLennan, who worked for the agent, about not being able to open the cage and, in accordance with Ms McLennan’s suggestion, had emailed the property manager, Eleanor Earley, about it. The Applicant said she thought Lyn, or perhaps someone else at the agency, had told her the storage cage was a mistake although there was a storage cage with ‘7/110’ on it.
When, in cross examination, she was shown Eleanor Earley’s Action & Conversation Diary and emails (Exhibit R1 Part B), the Applicant recalled that the agent had said they would contact the landlord over the storage. The first message in this diary appears to be a record of an email to the Applicant about the storage cage, in early December, which states: “Lyn has advised me (and also checked with Renee) that she believes that there is a storage cage for you. It has a sign painted on the front 7/110 – Renee should be able to help you with the correct key for it.” This is followed by an email from Eleanor Earley to the Applicant dated 13 December 2010 which states: “I am wondering if you got the key to your storage cage sorted out. The man to call is Renee. He is on site at Construction Control. Please call 61168922. He should be able to help you.”
The Applicant disputed that she had been told to contact Renee about the storage, telling the Tribunal that she was left with the understanding from the telephone call from Lyn or someone else at the agency that the provision of a storage cage was a mistake.

Ms Earley’s evidence was that she had sent the emails to the Applicant about getting access to the storage cage. She specifically recalled the email sent on 13 December 2012. She had also checked through the agency’s records and was unable to find any record of anyone from the agency saying that there was no storage for this unit. Ms Earley told the Tribunal that the Applicant had been present for the first inspection on 16 February 2011. The Applicant did not then raise the storage cage. She did not, again, raise the storage cage issue with the Agent until her email dated 22 March 2012. In cross examination, Ms Earley said she thought the issue of the storage cage had resolved after she sent the email dated 13 December 2010 to the Applicant.
Ms Earley said that after the Applicant vacated the unit and returned the keys she took these keys to the storage cage and found that the front door key worked for the storage cage.
Mr Zivko told the Tribunal that the unit, which was in the complex for which his company was the developer, had a garage and a storage area which was shown on the Plan which was Exhibit R2. The unit had a legal entitlement to the storage area. When he became aware, on 4 December 2010, that the Applicant had not been able to open the storage cage he checked it and found that the front door key opened it. He said the Applicant did not raise the issue of the storage cage directly with him at any stage.
The crux of the Applicant’s claim is that the Respondent engaged in misleading and deceptive conduct in relation to the unit’s storage. The Applicant sought to rely solely on a statement ‘Lyn or someone else from the agency’ was alleged to have made to the effect that there was no storage. The Applicant’s evidence was uncorroborated. The evidence from Ms Earley was that she had searched the agency’s records, copies of which were in evidence before the Tribunal, and she had not found any entry corroborating the Applicant’s evidence.
Having considered all of the evidence the Tribunal finds that the unit did have a storage cage which was identified on the Plan (Exhibit R2) and also by a sign on it stating 7/110. The Tribunal is not, therefore, satisfied that the Respondent engaged in misleading and deceptive conduct in informing the Applicant of the ample storage.
While it would appear that the Applicant did not use the storage area, notwithstanding the emails in December 2010 from Ms Earley notifying her whom to contact to obtain access to this area and that Ms Earley and Mr Zivko were both able to open the storage cage using the unit’s front door key, for reasons not readily apparent to the Tribunal the Applicant did not mention being unable to gain access to the storage cage after mid December 2010 until 22 March 2012, some 16 months later and approximately one month before she left the unit.
Further, the Tribunal notes, if the Applicant is claiming that she was induced to enter the lease of the unit only to discover that the storage cage was not physically accessible by her, the Tribunal cannot ignore the Applicant’s significant delay, until 22 March 2012, in relying on this as a basis for terminating the tenancy.
The Tribunal is satisfied and finds, having considered the evidence, that the Applicant did not give the Respondent the requisite notice after mid December 2010 pursuant to clauses 90(a) and 91 of the SRTT to rectify the storage cage access situation. The Respondent was entitled to conclude, after sending the Applicant the email dated 13 December 2010 and her ensuing silence on this issue together with the fact that the Applicant continued to pay the rent that the Applicant continued to affirm the agreement between the parties.

Whether the Respondent breached clauses 52 and 60 of the Standard Residential Tenancy Terms

The Applicant relies on the existence of smells coming from the drain in the sink, the water tasting funny and intermittent smells coming from the garbage chute as ‘interfering with her reasonable peace, comfort or privacy’ in using the premises and as being ‘urgent repairs’ which the Respondent should have repaired as soon as necessary, having regard to the nature of the problem.
The Applicant told the Tribunal that she had mentioned these issues to Ms Earley early on in the inspection but it was not followed up in writing and she did not hear anything about it again. She agreed that she had identified these issues in her emails to Ms Earley dated 22 March 2012 and 17 April 2012. She told the Tribunal that she had also mentioned them to Renee.
When asked in cross examination if she had notified the Respondent that these issues were breaches and given the Respondent 14 days to rectify, the Applicant initially replied that “there were earlier emails” and subsequently said she did not know that she was required to ask the landlord to remedy the breaches within 14 days. The Applicant also said that she had not thought of the garbage chute being managed by the Body Corporate.
Ms Earley told the Tribunal that she had not been able to locate any information on the Applicant’s record in relation to issues of smells, garbage chute smells or the water tasting funny until the Applicant’s emails of 22 March 2012 and 17 April 2012.
Ms Earley said she manages at least 10 properties in Pearl where the unit is situated and she has not received complaints about these matters from other unit occupiers. Ms Earley said she was shocked when the Applicant raised these issues in her email purporting to terminate the tenancy. Ms Earley had attended three inspections and noticed none of these issues. At the final inspection, after being notified of these matters in the Applicant’s email of 22 March 2012, Ms Earley noticed residue on the bins in the kitchen which, in her opinion, was sufficient, if the windows were closed, to cause the smell identified by the Applicant. Ms Earley said she offered to clean the bins if the Applicant did not.
Mr Zivko told the Tribunal that he has conducted his business at these premises since December 2010, when the project was completed. The Respondent also retains about 35 units there. He said that he is on the Body Corporate Committee. He also said that he has met the people who have bought properties there, that he liaises with other tenants, that no one has complained to him personally or to the Body Corporate about garbage chute smells, other smells or the drinking water, and he drinks the water.
The crux of the Applicant’s case is that the lessor (Respondent) caused interference with her enjoyment of the premises and thereby breached clause 52 of the SRTT. The Applicant identified the interference as smells from the drain, smells from the garbage chute and the taste of the water.
The onus is on the Applicant to provide evidence to the Tribunal that would enable it to be satisfied, on the balance of probabilities, that one or more of these problems existed and that they were the Respondent’s liability before considering whether or not any one of these problems interfered with the Applicant’s enjoyment of the premises.
The Tribunal is satisfied that the alleged odours are body corporate issues, not issues for which the landlord should be liable. It would appear to the Tribunal that the alleged water issue may also be a body corporate issue. The RT Act identifies, in section 60, thirteen items that fall in the category of ‘urgent repairs’ for which the landlord is mandatorily liable to repair. The Tribunal notes that the Applicant did not present any evidence which would enable the Tribunal to be satisfied, on the balance of probabilities, that any of the problems she identified fell into the category of ‘urgent repairs’ for which the landlord would be liable.
The Tribunal found that the issues relied on by the Applicant are not mentioned in the inspection reports until Ms Earley, having been alerted by the Applicant’s email notifying her of the issue of smells in the kitchen, in the course of conducting the ‘vacate inspection’, identified the existence of food residue on the bins and considered this as the probable cause of these smells.
The Applicant’s evidence in relation to notifying the Respondent of these issues was uncorroborated; at best, it was vague and unhelpful. The Applicant said she was becoming frustrated and concerned and stressed over a series of things that had built up over time, even if she did not state these issues every time. The Tribunal would have thought that if these alleged issues were impacting on the Applicant’s enjoyment of the unit to the extent that she would be relying on them to terminate her tenancy she would have raised them with the Agent well prior to her deciding to leave the unit.
Mr Zivko operates his business in Pearl and he is on the Body Corporate Committee. His evidence was that he, himself, had not experienced the various issues raised by the Applicant and that no one had complained to the Body Corporate about any of these alleged issues.
Having considered all of the matters before the Tribunal, it is not satisfied on the balance of probabilities that there was an issue or situation which interfered with the Applicant’s reasonable habitation of the unit and it is also not satisfied that the Respondent breached lease clauses 52 and 60.

Whether the Respondent expressly or impliedly gave notice to the tenant to vacate

The Applicant said that she had met Mr Zivko a few times as he had offices in the building. They had had a discussion about available commercial space in the building which she looked at. She said she was unable to see his reaction when he was told she was not taking this space as she did not see him.
There was no evidence which would enable the Tribunal to find that Mr Zivko had expressly or impliedly given the Applicant notice to vacate the subject premises in these discussions.
The Applicant was, evidently, also relying on the fact that Mr Zivko had told Mr Forsyth that she and Mr Forsyth were rude and by implication, that he was impliedly giving her notice to vacate the subject premises. The Tribunal will consider this evidence below when also considering whether the Respondent engaged in conduct intended to cause injury to the Applicant or members of her family.

Whether the Respondent engaged in conduct intended to cause injury to the Applicant or members of her family

The Applicant relies on section 45 of the RT Act, namely immediate termination if this Tribunal is satisfied that the Respondent has intentionally or recklessly caused or permitted or is likely to so cause or permit serious danger to the premises or property of the Applicant or injury to the Applicant or a member of her family.
The Applicant said that she held a fear of the likelihood of physical injury to herself or her family by Mr Zivko from November 2011. She said that this fear arose because she felt very much in the middle of a parking issue between Mr Zivko and Mr Forsyth.
It was apparent from the Applicant’s evidence, and the Tribunal finds, that the Applicant had not personally had any confrontation with Mr Zivko and that Mr Zivko had not levelled any abuse to her personally.
The Applicant said that Mr Zivko did it behind her back. The Applicant appears to rely on what Mr Forsyth told her about his contact with Mr Zivko to substantiate this ground.
Mr Forsyth spent time at the Applicant’s unit. It was not apparent until well into the hearing that they were a couple. His name was not on the lease and the lease only provided for one adult occupant. Mr Forsyth and the Applicant, between them, had three cars. Mr Forsyth was parking his car in parking spaces which belonged to Mr Zivko’s business, Consolidated Builders Limited. Ms Earley had emailed Mr Forsyth in mid November 2011 advising if he had been parking in the car park of Consolidated Builders Limited he will need to use the car parking allocated to the subject premises, unit 7/110.
Ms Early then emailed the Applicant on 15 December 2011 stating “if she knows who (the car) belongs to can you let them know they cannot park there.” While Mr Forsyth then ceased parking in Consolidated Builders Limited parking spaces, apparently he continued to park in other parking spaces at the Pearl complex which did not belong to the Applicant’s unit.
Mr Zivko said that on 12 January 2012 he had a discussion with Mr Forsyth about his repeatedly parking in parking spaces that were not the unit’s designated parking spaces. He said that Mr Forsyth had told him he was not a tenant. He offered Mr Forsyth a car space for $50 a week plus GST and had his solicitors prepare a licence agreement for six months. Mr Forsyth subsequently queried the price and did not execute the licence agreement.
On 17 January 2012 the Applicant emailed Ms Earley. She stated “…. Guy called me this morning to say that Josep had approached him saying that we were rude for not having responded on the car issue – I find that a little offensive. I have spoken with Guy about this on a number of occasions but he keeps saying that the place is empty why is it a problem if I park in a spare spot – I can see his point.. He has not been parking in the Consolidated Builders car park since we received your email. Anyway-is there anything I can do about parking whilst there are so many spots not being used it seems a bit petty that we can’t come to some arrangement about an additional spot? Would you mind looking into this for me?...”
Mr Zivko, in cross examination, said Mr Forsyth had been parking his car in a car space which was not designated for the subject premises for months. Prior to the conversation with Mr Forsyth on 17 January 2012 Mr Zivko had liaised with him about renting him a car space. Mr Zivko’s staff had also tried to sort out the parking. On 17 January 2012, Mr Zivko bumped into Mr Forsyth. He told the Tribunal he regarded both the Applicant and Mr Forsyth as rude as they had repeatedly failed to comply with his requests and the Agent’s requests not to park in undesignated car spaces.
On 17 January 2012 Mr Forsyth placed a handwritten note on the windscreens of cars in the basement car parking area seeking to use a car space for two to three months for cash or wine in compensation. Mr Zivko told the Tribunal that one of his staff members found one of Mr Forsyth’s notes on her windscreen. He does not allow his staff to sublet car parks. A copy of this note was forwarded to the Agents and he arranged for the Agent to follow this up.
Ms Earley emailed the Applicant on 20 January 2012 reiterating the owner’s offer to rent a car park to Mr Forsyth for $2,500 per annum plus GST. The email states “.......The owner is concerned that parking in incorrect spots creates confusion and is a little unfair for to the residents. He also mentioned it is not appropriate to leave notes on other tenant’s windscreens requesting the use of renting their car space. I can appreciate that this is difficult situation for you, but we have concerns about subletting carparks.”
Ms Rochelle Print, who was looking after Ms Earley’s matters while she was on leave, sent a further email to the Applicant on 25 January 2012 which included: “....The owner has contacted me and is concerned that an occupant in your property is utilising a car space that is not designated for your property. We are requesting that the vehicle be moved, and that the usage of an undesignated car space cease. Your property is provided with 2 car spaces only. I understand that the owner has offered that a carspace can be rented for a fee. I would appreciate your assistance in this matter”
On 27 January 2012 the Applicant emailed Ms Print as follows: “ – just following up on the car parking issue. I spoke with guy on Wednesday and he tells me that he has reached an agreement with one of the businesses in the building. They have agreed to allow him to park in one of their spaces (for no charge) as they are not using all their spaces. This will be a temporary arrangement as we will be storing the third car at our coast property whilst we are overseas in February and March. I hope this puts the issue to rest once and for all.”
In considering this issue the Tribunal notes that Mr Forsyth did not give evidence. Apart from the Applicant’s email to Ms Earley dated 17 January 2012 there was no evidence on the Applicant’s behalf which would assist the Tribunal to determine whether the Respondent engaged in conduct intended to cause injury to the Applicant or members of her family, or whether he expressly or impliedly gave notice to the tenant to vacate.
The Applicant stated in the Application that Mr Zivko, on or around 15 November 2012 (sic), stated to Mr Forsyth “you are both very rude people” and “Why don’t you go back to the rude place you came from and get out of here.” The Applicant conceded that this was her recall of what Mr Forsyth reported to her. The Tribunal has already noted that it did not have the benefit of Mr Forsyth’s evidence.
Mr Zivko denied that such a confrontation occurred in November 2011. He said that there was an ongoing parking issue caused by Mr Forsyth, who was not a tenant, not only not parking in the unit’s designated car spaces but using and continuing to use other car spaces without permission notwithstanding requests that he desist. Mr Zivko had offered Mr Forsyth a licence to use a car space and had had his solicitors draw up the appropriate document which Mr Forsyth did not sign. Mr Zivko said that he did tell Mr Forsyth, that he was rude in January 2012.
In the absence of any evidence from Mr Forsyth the Tribunal only has Mr Zivko’s evidence of what occurred between himself and Mr Forsyth and what the Applicant said she heard from Mr Forsyth. In weighing up this evidence, the Tribunal notes that the Applicant’s evidence was uncorroborated and Mr Zivko denied that there was a confrontation in November 2011.
The Tribunal also notes that in the email from the Applicant to Ms Print dated 27 January 2012 the Applicant stated “I hope this puts the [parking] issue to rest once and for all.” This would appear to be the end of the matter from the Applicant’s point of view.
There is no evidence before the Tribunal of any contact between the Applicant and Mr Zivko between 27 January 2012 and 22 March 2012 when the Applicant emailed Ms Earley and stated “I feel a little uncomfortable about the way the parking stuff has been handled…..”, which could assist the Tribunal to understand why the Applicant, after apparently regarding the matter resolved on 27 January 2012, would now state in her Application lodged on 8 June 2012 “I also felt that the landlord may intend to injure my daughter or myself.”
Having considered the available evidence, the Tribunal is not satisfied that there is any credible evidence to enable the Tribunal to find on the balance of probabilities that the Respondent engaged in conduct intended to cause injury to the Applicant or members of her family.
The Tribunal is also not satisfied from the available evidence that there is any credible evidence to enable the Tribunal to find on the balance of probabilities the Respondent expressly or impliedly gave the Applicant notice to vacate the unit.

Whether the Applicant had given the Respondent a valid notice to terminate, and, if so, whether the notice had been accepted by the Respondent or not accepted by the Respondent or did the termination arise by the Applicant’s abandonment of the premises

Section 36 of the RT Act provides that a residential tenancy agreement may only terminate in certain circumstances. Subsection 36(b) applies where a tenant has given notice to terminate to the lessor, and has vacated the premises in accordance with that notice. In such cases, the tenancy terminates on the date the tenant vacates the premises, irrespective of whether the lessor has agreed to the early termination or not.
Clause 84 of the SRTT provides that where a lessor receives a notice of intention to vacate before the end of the fixed term of the tenancy agreement, the lessor may either accept the notice or apply for compensation for loss of rent, advertising and reletting costs. Any such compensation is capped and section 84 of the RT Act directs ACAT to have regard to the time at which the tenancy agreement would have ended and the lessor would have incurred the costs.

Section 36(e) of the RT Act applies where the tenant abandons the premises. In such cases, section 61 of the RT Act provides that the tenancy agreement terminates on the day of abandonment.
Where a tenancy terminates by abandonment, section 62 of the RT Act provides that the former lessor may apply for compensation for the loss of rent that the lessor would have received had the agreement continued to the end of its term (capped at 25 weeks’ rent), plus compensation for advertising and reletting costs (capped at 1 weeks rent). Subsection 62(4) directs the ACAT in determining the amount of compensation to have regard to the date the agreement would have ended but for the abandonment and the reasonable costs of advertising the premises for lease and of giving a right to occupy the premises to another person.
Whether the tenancy has been terminated by notice or by abandonment turns upon whether there has been a valid notice of intention to terminate.

Was there a valid notice to terminate?

Clause 85 of the SRTT sets out the requirements of a notice to terminate. In the current case, the Applicant said she gave notice by email on 22 March 2012 to terminate the lease. In this email the Applicant referred to a number of issues and then stated:
“Anyway, the main issue is that the apartment is just not turning out to be suitable to our needs so I would like to give notice of my intention to terminate the lease. I understand I need to provide four weeks notice so I would like the end date to be 22 April (just over four weeks from today). Can you please advise of the process for termination from your end. ... “
To comply with clause 85 the notice must contain the statement that the tenant intends to vacate the premises on a certain date and the tenancy terminates on that date. While the email giving the notice of intention to terminate does not use the words “vacating the premises”, the Tribunal is satisfied and finds that it is clear that the tenant is informing the Agent the lease is to end on 22 April 2012 and implicit in that is that the tenant will be vacating the premises on that date.
The Tribunal is satisfied and finds that there is a valid notice to terminate.
Section 84 of the RT Act provides that if the lessor has received a notice of intention to vacate before the end of a fixed term agreement and the date nominated in the notice is before the end of agreement the lessor may accept the notice or apply to ACAT for compensation.

Was there acceptance of the notice to terminate?

The Applicant had previously notified the Agent by email dated 23 August 2011 that she was “... considering terminating the lease earlier than expected...at the end of the 1^st year (this November / December if possible). The Applicant also asked in this email that the Agent let her know what the conditions of this (earlier termination) would be and what she would need to do to make the necessary arrangements, if she decided to proceed. By email dated 25 August 2011 in reply, the Agent notified the Applicant:
“The break of lease details are in your lease pack. Basically, you would have to advise us that you are vacating and we would commence advertising to find a replacement tenant for you. Our leasing consultant would co ordinate inspections by appointment only. You would need to pay compensation to the owner for re letting and advertising costs (it would be one week’s rent). Further you would be required to pay rent until a new tenant is found....”
The Agent’s email dated 27 March 2012 to the Applicant in reply to the Applicant’s email dated 22 March 2012 states:
“Dear Kathy
Thanks for your email.
We do understand that some people have changing circumstances. As outlined in your tenancy agreement you are bound to this agreement till the fixed term expires on 04 December 2012. If you wish to leave before this time, you will be breaking the lease.
In the event you wish to break lease you will need to advise us of your last date (there is no notice required as you are breaking lease, so you can determine this.) we will then commence advertising the property when you advise this. It is in your best interest to provide access to prospective tenants. Our leasing consultant will be in contact to arrange a time that suits you.
Compensation to the owner for reletting the property and advertising costs is required and this is the equivalent to one week’s rent. In addition to this, you will be responsible for the rent up until a new tenant is found.
I await your formal advice of a break of lease.
Thanks Kathy
Kind Regards
Eleanor Earley”
The Applicant in her email to Ms Earley also dated 27 March 2012 nominated 22 April as the day she wanted to pay rent until. She nominated 15 April as the break lease date and sought clarification that her liability will be for the advertising costs and one week’s compensation. Ms Earley emailed the Applicant on 30 March 2012 and advised that the Applicant, “under the terms of the lease you are bound to pay rent until a new tenant is found.”
The Tribunal is satisfied and finds that the Agent’s email of 27 March 2012 was not an unconditional or unequivocal agreement to or acceptance, in the sense that that word is used in clause 84 of the SRTT or section 84 of the RT Act, of the Applicant vacating the property without liability for compensation. While these italicised words are not expressed in subsection 84 (1)(a) of the RT Act it is important to note that if an acceptance is to be effective for the purposes of section 84 it cannot be predicated on an understanding that compensation is to be paid.
Having considered all of the evidence, the Tribunal is satisfied and finds that the Respondent did not accept the Applicant’s notice to terminate. The Respondent had applied to the Tribunal on 30 April 2012 for confirmation of tenancy and compensation in proceedings RT 12/452. The Agent notified the Applicant in the email dated 1 May 2012 of these proceedings. Ex parte orders were made on 23 May 2012 which provided for the Office of Rental Bonds to release the bond of $3,800 to the agent forthwith. Subsequently, the compensation part of this application was heard with RT 12/649.

Consideration

The Tribunal is satisfied, for the reasons set out above, that each of the grounds relied upon the Applicant for termination of the lease has not been established on the balance of probabilities. Therefore, the Applicant’s application to terminate the lease must fail.
The Tribunal is satisfied and finds that the Applicant terminated, without cause, the residential tenancy agreement during the fixed term period.
While the Respondent asked the Tribunal to find that the Applicant abandoned the premises during the fixed term, as a result of the Tribunal’s findings (in paragraphs 82 and 85 above) that the Respondent did not accept the Applicant’s notice of termination and that the Applicant terminated the tenancy agreement during the fixed term without cause, it is not necessary for the Tribunal to consider whether the ground of abandonment has been made out.
The remaining issue for determination is whether the Respondent is entitled to compensation as provided for in subsection 84(1)(b) and subsections 84(3) and (4) of the RT Act.

Whether compensation is payable and if so, in what amount. This involves a consideration of whether the Respondent mitigated the loss.

What is encompassed by the right to compensation?

Where a residential tenancy agreement is terminated without cause during the fixed term period, the lessor is entitled to compensation in accordance with the legislation for loss of rent. Section 84 of the RT Act allows a lessor to seek compensation for rent lost as a consequence of early termination of a tenancy agreement, together with reasonable costs of advertising and reletting of the premises. No compensation for advertising or reletting expenses is sought.
Section 84 of the RT Act provides that the amount of compensation for unpaid rent which may be awarded is limited to 25 weeks’ rent or the rent for the unexpired part of the agreement, whichever is the lesser.
The Applicant submitted that the correct interpretation of this section is that damages or compensation is, therefore, limited to a period of 25 weeks and in this case, as the 25 weeks would not expire until 18 October 2012, such damages could not be determined until after that date.
The Respondent disagreed with this interpretation, submitting that compensation is to be calculated assuming the agreement would have continued to the end of the term (section 62(1) of the RT Act), which is a period of 31 weeks at $1,000 a week, namely $31,000, but not exceed an amount equal to 25 weeks rent. The Tribunal will return to this under Calculation of Compensation later in the Decision.

Did the Respondent/lessor take all reasonable steps to mitigate its loss?

The Applicant submitted that the Respondent had failed, on a number of grounds, to mitigate its loss and compensation should be reduced accordingly. These grounds were as follows.
· Notwithstanding the lease required the Applicant to pay rent of $1,000 for the remainder of the term, this amount was unrealistic and unachievable and that a rent of $900 a week was achievable.

Consideration

Ms Earley said that the subject premises were advertised on allhomes on 5 April 2012. She produced the Exhibition Register which showed that the premises had been open for exhibition forty five times between 12 April 2012 and 15 September 2012 (Exhibit R1 Part A page 91). The premises were also inspected at other times when prospective tenants made an appointment with Sonia Mikic, the Agent’s leasing consultant.
Ms Earley provided evidence of Comparable Rentals (Exhibit R1 Part A page 92). She said that the Eyre Street premises (a very similar property) had been advertised for $1,000 a week and rented for $900 a week in July 2012. This property does not have a storage cage. 5/57 Eyre Street was advertised for $1,000 a week; 7/57 Eyre Street was advertised for $1050 a week ; 5/110 Giles Street (a similar property to the subject premises which has a poorer outlook and no storage) for $950 a week; 7/110 Giles Street (the subject premises) for $1,000 a week; 4/120 Giles Street (which has an extra large balcony) for $1250 a week and the penthouses at both 9/110 Giles Street and 9/57 Eyre Street for $1575 a week.
Mr Zivko told the Tribunal that the Eyre Street premises do not have a storage cage. It had been let to an Embassy in July 2012 for $900 a week and the rent is to increase by $40 per week after 12 months. He said that he does not give the units his company owns precedence over seeking a tenant for the subject premises, that he is in constant contact with the Agent, and that a week before the hearing he had observed a gentleman looking at the complex and he took him through the subject premises.
Mr Zivko also told the Tribunal that there has been and continues to be a stock of rental properties like the subject premises on the market, that the asking price of $1,000 a week for the subject premises is entirely consistent with the ordinary course of business, and that he is under no obligation to lower the asking rent because of the impact that would have on the other properties his company has for rent in Pearl.
Mr Flint referred the Tribunal to case law in his submissions highlighting general principles to be observed when determining whether a landlord has taken reasonable steps to mitigate. These principles which are derived from Karacominikas v Big Country Developments Pty Ltd [2000] NSWSCA 313 at [187] are:
In essence, each of the grounds in paragraph 92 above relied on by the Applicant appear to be designed to reduce her own liability. The case law provided by Mr Flint to the Tribunal establishes that it is not for the wrongdoer (the Applicant) to dictate terms to the lessor (Respondent) about how to reduce the tenant’s liability. The issue for the Tribunal is to determine from the matters before it whether the Respondent has or has not failed to mitigate its loss.
The Tribunal will deal with the grounds relied on by the Applicant.
The asking rent of $1,000 is unrealistic and unachievable; $900 a week is both realistic and achievable.
The subject property is in a complex of apartments and commercial premises at the upper end of the market in Kingston. It is described on allhomes (Exhibit R1 Part A page 89) as:
“....this outstanding apartment in the "Pearl "complex in Kingston. This apartment is of the highest standard and incredibly spacious offering two living areas and three bedrooms. The apartment is all about quality with the state of the art kitchen offering integrated fridge plus wine fridge and coffee machine. The complex offers a large range of lifestyle facilities making these apartments a delight to come home to.”
Features of this apartment include:
* Open style floor plan with two large living areas.
* Impressive floor to ceiling sliding glass doors to balcony.
* Spacious balcony ideal for entertaining.
* State of the art kitchen with Gaggenau appliances, integrated fridge, wine fridge and coffee machine.
* Spacious master bedroom with walk in robe and ultra modern ensuite.
* Additional two bedrooms with robes.
* Fully ducted heating and cooling.
* Double remote controlled garage.
* Complex with pool, gym and barbecue facilities”
The evidence is that similar properties available for rent in the Pearl complex range from $950 a week to in excess of $1,000 a week. The Applicant agreed to pay $1,000 a week rent for the second twelve months of her tenancy. It appears to the Tribunal, therefore, that the Applicant, herself, regarded this as a proper and realistic rental payment for the subject premises for the second twelve months of her tenancy.
The Applicant points to the fact that the Eyre Street premises, described as ‘a mirror image of’/‘very similar to’ the subject premises, being leased after being on the market for a number of months for $900 a week as being indicative of a realistic rent payment for the subject premises. However, it does not have a storage cage. This was the explanation given by the Respondent for the difference in the rent agreed upon.
There was simply no evidence before the Tribunal which enables it to be satisfied, on the balance of probabilities, that rental of the Eyre Street premises took precedence over the subject property or that the incoming tenant of the Eyre Street premises was interested in renting the subject premises. In fact, Mr Zivko’s evidence was that the rent of the Eyre Street Premises did not take precedence over the rent of the subject premises.
Mr Zivko’s evidence was that it was both reasonable and in keeping with his ordinary business practice, given that his company owns a number of units in the Pearl complex, to advertise the subject premises for the same rent that the Applicant had agreed to pay, $1,000 a week.
Mr Flint provided the Tribunal with copies of authorities in support of his submission that the respondent has taken reasonable steps to mitigate its loss. He referred to the statements in the text edited by JLR Davis - Contract: General Principles: the Laws of Australia at 7.9.560:
“A plaintiff’s duty to mitigate damage does not require him or her to do what is unreasonable and the plaintiffs are not required to do things that present serious risks to their interests. The standard required of the plaintiff is not demanding and there is no obligation to do anything other than in the ordinary course of business. ... Mitigation is a question of fact not law. It is determined on the grounds of what action is reasonable on the plaintiff’s part.”
He submitted that his client was not required to act outside the ordinary course of business (Young v Lamb (No 2) [2001] NSWSC 1014, paragraph 31; Fresh Express Australia Pty Ltd v Larridren Pty Ltd [2002] FCA 1312, paragraph 125).
In Kiem Dang Investment Pty Ltd v Jewel Food Stores Pty Ltd & Ors [2009] NSWSC 870, (“Kiem”) Patten AJ said at paragraph 173 – “The Plaintiff, in my opinion, did all that was reasonably required of it by placing the reletting in the hands of, what I hold to be, a reputable and experienced agent.”
The Respondent’s evidence was that it retained a significant number of apartments in the Pearl complex, at least five of which had been given to the Agent, Peter Blackshaw Manuka, to manage in 2010 (Exhibit R1 Part A, pages 2 – 7). The rental of these apartments forms part of the Respondent’s ordinary course of business. Mr Zivko’s evidence was that he was not under an obligation to lower the rent being sought by the Agent for the subject premises because of the impact that would have on the stock of properties his company held in Pearl.
The Agent engaged by the Respondent is a well known local, experienced agent, which has been renting and managing properties in the Pearl complex since 2010.
The Agent has given evidence through Ms Earley of the asking rental price and the lease of properties within the Pearl complex during the relevant time. While the only comparable property, the Eyre Street premises, leased while the subject premises were available for rent was rented for $900 a week, after being advertised for about two months, the Tribunal has already noted that it did not have a storage cage. If it was implicit in the Applicant’s claim that Mr Zivko had instructed the Agent to let the Eyre Street premises in July 2012 instead of the subject premises in the knowledge that the Applicant would be liable for rent for 25 weeks for breaking her tenancy, the evidence fell far short of satisfying the Tribunal to the requisite standard of proof.
Ms Earley’s evidence in relation to the asking price for the rent of the subject premises was not successfully challenged. The Tribunal had no hesitation in accepting her evidence.

It is readily apparent that the subject premises are at the upper end of the rental market in Canberra, which has been harder to rent due to the supply of properties in this category on the market. This is not the respondent lessor’s fault. The Respondent’s duty is to mitigate its own loss, not the Applicant’s loss.

The alleged failure to advertise until 5 April 2012

The subject premises were first advertised on allhomes.com.au on 5 April 2012 (Exhibit R1 Part A pages 87–90). The Applicant claims that the “delay” of two weeks from her email giving notice to the Agent and the Agent advertising the subject premises is unreasonable, and any compensation she is required to pay should be reduced by two weeks rent on account of this unreasonable delay.
The Tribunal has carefully considered the email trail following the Applicant’s email dated 22 March 2012, which was sent from overseas. Ms Earley said that she did not interpret the Applicant’s email dated 22 March 2012 as the Applicant giving formal notice of vacating the subject premises. This was because the Applicant had twice previously emailed similar “notices” to the Agent and not followed through and vacated the subject premises when the Agent had informed her of the financial ramifications of breaking a lease. Ms Earley said she wanted to make sure the Applicant was aware of these ramifications and asked her in the email in reply (see paragraph 80 above) to provide the Agent with ‘formal advice of a break of lease’.
The emails (Exhibit R1 Part B pages 11-20) show that on 27 March 2012, also sent while the Applicant was overseas, the Applicant nominated the date she would pay rent to, 22 April 2012, and in this email she asked the Agent to commence advertising as soon as possible. On 30 March 2012, the Agent notified the Applicant she wanted to have photos of the inside of the subject premises and then there was a delay in hearing from the Applicant until 3.10 pm on 2 April 2012. Ms Earley responded at 3.43 pm the same day and nominated the following Wednesday, 4 April 2012 to take the photographs. The Applicant changed this date to 5 April 2012 as the Applicant was unwell.
The photographs were taken on 5 April 2012, the day the subject premises were advertised. This was one week and three days after the Applicant’s email dated 27 March 2012 and some three days after the Applicant’s email of 2 April 2012. Ultimately the Applicant vacated the premises on 27 April 2012, three weeks and two days after the first advertisement.
Ms Earley also stated in an email to the Applicant dated 15 April 2012 –
“At the time you first emailed me, I told our leasing consultant that your property may become available. The reason for this is that we have exactly the same apartment for lease at 6/57 Eyre Street (PEARL). It has been on the market for many weeks. This property is the mirror image of yours. Our leasing department has not yet had enquiry on that property either. In the event, that they did, they were in a position to mention yours.”
The Tribunal is satisfied and finds that the Agent’s actions, after receiving the Applicant’s email of 27 March 2012, were reasonable. Ms Earley notified their leasing consultant that the subject premises may become available. It was Ms Earley’s expert opinion as the managing agent, which was not challenged and the Tribunal accepts, that “it would be far more appealing to have a high impact [with internal photos] with your advertising.” Once the photos were taken the subject premises were advertised on the same day, 5 April 2012. To the extent that there was any delay, the Tribunal finds that the Applicant partly contributed to that delay.

The Respondent failed to reasonably liaise with the Applicant

The email trail (Exhibit 1 Part A) shows that the Applicant and the Agent were in regular email contact until May 2012. There was no evidence before the Tribunal of the Applicant seeking and being denied the opportunity to speak with Ms Earley about the efforts being taken and planned to find a replacement tenant. The subject premises were advertised on allhomes which is searchable by the public.
It appeared that the Applicant claimed that as a result of the Agent and the Respondent not discussing the rent being sought with her, the Respondent unreasonably failed to mitigate the loss (and resolve the dispute) as the Applicant was denied an opportunity to offer to meet any difference between a rental offer of less than $1,000 a week and the rent she was required to pay under the agreement.
Mr Flint referred the Tribunal to the case of Maridakis v Kouvaris (1975) 5 ALR 197 (“Maridakis”) and submitted that “It is not for the wrongdoer to dictate terms to the lessor about how to reduce the tenant’s liability nor is it sufficient to warrant a finding of unreasonableness that the tenant can suggest outcomes that would be more beneficial to the tenant.”
The Tribunal is not satisfied, having considered all of the matters before it, that there was any obligation on the Respondent to liaise with the Applicant. The Respondent’s obligation is to mitigate its own loss. At the end of the day it is for the Tribunal to determine from the matters before it whether the Respondent has or has not failed to mitigate its loss. The Tribunal concurs with Mr Flint’s submission that a failure to accommodate a compromise suggested by a tenant is not sufficient to warrant a finding of unreasonableness.
Whether the Respondent should have used the services of more than one real estate agency in looking for a tenant to mitigate the Respondent’s loss
This claim is at odds with the comments of Patten AJ in Kiem (see paragraph 106 above).
The Tribunal notes that the Respondent used the services of the Agent, Peter Blackshaw Manuka, to manage its rental properties in the Pearl complex and had done so since the complex was completed in 2010. The subject premises were advertised on allhomes as well. Peter Blackshaw’s logo states “Marketing quality property” and that it is a proud member of ‘lpma” – Leading Property Managers of Australia. The property was referred to by Ms Earley in her emails to the Applicant as high end property. It was not in dispute that the subject premises were in the high end quality property bracket and that the Agent was experienced in this market.
The Tribunal is satisfied from the evidence that the Agent had 45 open inspections between 12 April 2012 and 15 September 2012 (Exhibit R1 Part A page 51). There were five open inspections in April, nine in May, eight in June, nine in July, eight in August and six to 15 September. The property was also opened for inspections by appointment with prospective tenants who had contacted the Agent expressing an interest in viewing the subject premises.
The Applicant did not call any evidence from any other real estate agent with experience in managing high end quality property which may have persuaded the Tribunal that there was merit in the Applicant’s submission. In the absence of any such evidence and in the light of the matters set out in the preceding three paragraphs, the Tribunal finds that this submission fails.

The Respondent should have used all types of advertising, not only allhomes

This claim, like the previous two claims, appears to be based on the erroneous belief that a tenant can dictate to a landlord the process to be followed in situations where the tenant has terminated a fixed term lease and is liable for any resulting compensation (see Maradakis, paragraph 120 above).
In the absence of any supporting evidence from the Applicant the Tribunal is not satisfied that there is any merit in this submission. The Tribunal finds that the fact that the Respondent used the Agent and the Agent used allhomes and no other advertising, as now suggested by the Applicant, is not sufficient for the Tribunal to warrant a finding of unreasonableness on behalf of the Respondent.

The Respondent had an obligation, in mitigating the compensation payable as a result of the Applicant vacating the subject premises, to rent the subject premises to the tenant who rented 6/57 Eyre Street in July 2012 and thereby cap the compensation claimed.

The Tribunal has already dealt with this claim above.
Firstly, if it was implicit in the Applicant’s claim that Mr Zivko had instructed the Agent to let the Eyre Street premises in July 2012 instead of the subject premises in the knowledge that the Applicant would be liable for rent for 25 weeks for breaking her tenancy, the evidence fell far short of satisfying the Tribunal accordingly.
Secondly, it is for the Tribunal to determine from the matters before it whether the Applicant has established, on the balance of probabilities, whether the Respondent has or has not failed to mitigate its loss. For the reasons set out above the Tribunal is not satisfied that a failure by the Respondent to accommodate this compromise suggested by a tenant is sufficient to warrant a finding of unreasonableness of behalf of the Respondent.
Mitigation is a question of fact not law. The Tribunal has considered all of the evidence in relation to the Respondent’s actions in mitigating the loss. For all the reasons set out above the Tribunal is satisfied, on the balance of probabilities, that the Respondent has taken reasonable action to mitigate its loss.

Conclusion

Section 83 of the RT Act sets out the orders that the Tribunal may make in relation to a tenancy dispute. Specifically, subsection 83(d) allows the making of an order for compensation for loss of rent or any other loss caused by breach of a residential tenancies agreement. The legislature chose to leave open to the Tribunal the question of assessment of compensation, subject to the duty to mitigate imposed by section 38 and the cap imposed by subsection 84(3).
The Tribunal has referred to above and found that the steps taken by the Respondent through its Agent to look after the reletting of the subject premises met the test in Kiem Dang Investment Pty Ltd v Jewel Food Stores Pty Ltd & Ors [2009] NSWSC 870. The Tribunal has found that the subject premises were advertised as available for rent within a reasonable time of the Applicant notifying the Agent of her intention to vacate the subject premises. The subject premises were advertised on allhomes, 45 open inspections had been held since 5 April 2012 and the subject premises have been opened for appointments outside of the open house times.
Although prospective tenants attended the open house inspections, no applications seeking to commence a tenancy were received. In response to a question from the Tribunal, Mr Forsyth said that the Applicant had not taken any independent steps herself to locate suitable tenants because “she had terminated the tenancy.”
Taking all of the above factors into account, the Tribunal is satisfied that the tenancy agreement was breached by early termination by the Applicant. Although a Notice of Intention to Terminate was given it was not accepted by the Respondent or the Agent, and the Respondent was entitled to seek compensation under section 84 of the RT Act. The Tribunal has already found that the Respondent took reasonable action to mitigate its loss.
In assessing the amount of compensation, the Tribunal was satisfied that the early termination of the tenancy agreement led to a loss of rent from 27 April 2012, which was continuing at the date of the hearing, 20 September 2012.
Mr Forsyth submitted that an assessment of the loss or compensation could only occur after 18 October 2012, after the 25 weeks in section 62(3)(a) of the RT Act has expired.
Mr Flint submitted that it is not the case that damages are limited by time to a day 25 weeks from termination of the lease. He submitted that compensation is calculated on the assumption that the agreement would have continued to the end of the term (section 62(1) RT Act) which pursuant to section 62(4)(a)RT Act is 4 December 2012. This is a period of 31 weeks and the total rent paid would have been $31,000 and it is this amount which is capped at $25,000 (paragraph 8 of the Respondent’s submissions). Subsequently in the submissions, Mr Flint stated (at paragraph 34) that the bond of $3,800 should be deducted from the total rent of $31,000 payable for the remainder of the term and the resulting amount of $27,200 should be capped at $25,000.
From the date of vacation of the subject premises to the date of the hearing was a period of 21 weeks. Mr Flint submitted that the Tribunal can discount what might happen in the remaining four weeks. The Tribunal proposes to calculate the compensation on the evidence before it, namely, that the premises had not been relet during that 21 weeks and the compensation payable should be assessed accordingly, at $21,000 (being 21 weeks x $1,000).
While the Applicant did not raise the issue of the bond being applied towards any compensation which the Tribunal determined to be payable by the Applicant, the Tribunal notes that the Agent has received the bond of $3,800.
Section 31 of the RT Act lists what payments can be made out of the bond. The Tribunal is satisfied, for the reasons set out in the following three paragraphs, that the Tribunal’s power conferred by subsection 83(e) of the RT Act is not limited to those matters listed in section 31 of the RT Act.
The Community Law Reform Committee (CLRC) of the Australian Capital Territory, Report No 8, Private Residential Tenancy Law (1994) commented that it was ‘vital that a lessor have a practical and swift remedy to recover any losses due to a breach of the tenancy agreement.’ This was to be achieved in two ways, the creation of a specialist Tribunal with processes and powers to enable it to deal quickly and fairly with claims by the lessor or tenant, and by vesting that Tribunal with powers “to order compensation to be paid to the lessor out of any existing bond money irrespective of the subject matter of the claim. In this case the merit of the claim, however complex, is assured by the ruling of the tribunal, and deductions from the bond for any matter is appropriate.” [CLRC report, paragraph 206].
Consequently, the second part of Recommendation 48 provided: “where a claim for compensation for any breach of the tenancy agreement is upheld by the Tribunal, the Tribunal should have the power to authorise that money be taken from the bond and paid to the lessor as compensation whatever the subject matter of the claim.”
The powers conferred on what was then the Residential Tenancies Tribunal under (then) section 104 of the RT Act included a power to order compensation and the power to order payment to the lessor of an amount out of the bond (in the same terms that are now provided by subsection 83(d) and (e)). Subsection (e), on its terms, operates in the manner contemplated by second part of Recommendation 48. There is no suggestion in the extrinsic or intrinsic material that the subsection is not to operate in such a manner. The Tribunal considers that the correct interpretation of subsection 83(e) is that it is open to the Tribunal to make an order directing payment out of the bond irrespective of the subject matter of the claim.
Therefore, the amount of the bond of $3,800 should be deducted from the compensation of $21,000. The compensation remaining to be paid by the Applicant to the Respondent is, therefore, $17,200.

………………………………..
Elizabeth Symons,
Presidential Member

PUBLICATION DETAILS

TO BE PUBLISHED

To be completed by Tribunal Staff

PART A

FILE NUMBER:	RT 12/411
PARTIES, APPLICANT:	LUTON PROPERTIES REPRESENTING EILEEN PATEMAN
PARTIES, RESPONDENT:	HUGH GRIFFIN & CATHERINE GAUTHIER
COUNSEL APPEARING, APPLICANT
COUNSEL APPEARING, RESPONDENT
SOLICITORS FOR APPLICANT
SOLICITORS FOR RESPONDENT
TRIBUNAL MEMBERS:	E.Symons
DATES OF HEARING:	21 June 2012
PLACE OF HEARING:	Canberra

PART B

RECOMMENDATION:

FULL REPORT ( ) CASE NOTE ( ) UNREPORTED DECISION ( )

COMMENTS: