Robert Dearn & Darrel Chai v Johnny Folino
[2007] ACTRTT 24
•27 July 2007
AUSTRALIAN CAPITAL TERRITORY
RESIDENTIAL TENANCIES TRIBUNAL
CITATION:ROBERT DEARN & DARREL CHAI V JOHNNY FOLINO [2007] ACTRTT 24
RT 336 of 2007
Catchwords: Residential Tenancies Act 1997 (ACT)
Lessor’s duty to carry out urgent and non-urgent repairs
Compensation for breach of obligation to repair
Rental reduction for loss of use of part of the premises
Tribunal:Jennifer A. David, Member
Date: 27 July 2007
AUSTRALIAN CAPITAL TERRITORY )
RESIDENTIAL TENANCIES TRIBUNAL ) NO: RT 336 of 2007
RE: Robert Dearn and Darrel Chia
(Applicant/Tenants)
AND: Johnny Folino
(Respondent/Lessor)
DECISION
Tribunal : Jenifer A. David, Member
Date : 27 July 2007
Decision :
That the tenants are granted a total rental reduction from 27 February to 18 March 2007 amounting to $1,106.91.
The tenants are granted a 20% rental reduction from 19 March 2007 until the ceilings and window frames are repaired by the lessor though the body corporate. The reduction is to be $74.00 per week.
…………………………….
Member
AUSTRALIAN CAPITAL TERRITORY )
RESIDENTIAL TENANCIES TRIBUNAL ) NO: RT 336 of 2007
RE: Robert Dearn and Darrel Chia
(Applicant/Tenants)
AND: Johnny Folino
(Respondent/Lessor)
REASONS FOR DECISION
27 July 2007 Jennifer A. David, Member
Background
This application concerns an apartment at 10/16 Macleay Street, Turner in the ACT. The apartment was leased by the lessor to the tenants from 15 December 2006 for 52 weeks.
This matter arose out of water initially entering the premises during a storm in Canberra on 27 February 2007. There was a second water entry during a second storm on 18 March 2007. The tenants claimed there was extensive flooding of the premises and that the lessor had not fulfilled his obligations under the tenancy agreement and the Standard Residential Tenancy Terms contained in Schedule 1 of the ACT Residential Tenancies Act 1997 (“standard terms”) to carry out urgent and non-urgent repairs and still had not done so at the time of the hearing before the tribunal on 11 July 2007.
Having continued to pay full rent throughout the periods the subject of this claim, the tenants sought a rental reduction for the period/s the tenant’s claimed their use or enjoyment of the premises was significantly diminished as the result of the loss of the use of all or part of the premises and by the lessor not carrying out all the required repairs to the premises resulting from the water entry. The tenants sought:
- A total rental reduction for the period 27 February to 18 March 2007, a three week period.
- A 70% rental reduction for Mr Dearn from 19 March to 27 April 207 when the roof was repaired.
- 20% rental reduction from 28 April to the date the lessor finalises the remaining repairs to the apartment to restore it to the condition it was in at the commencement of the tenancy.
Finally, the tenants sought an order that the lessor carry out the remaining repairs to the premises within a reasonable period.
In their Statement of Particulars and their evidence the tenants claimed that on 27 February water entered both bedrooms, the walk-in wardrobe in the main bedroom, the hallway, the dining area and part of the living area in the apartment. They stated that approximately 2 centimeters of water sat above the carpet in some areas. This was corroborated by the email Mr Dearn sent to the lessor’s property manager on 28 February 2007, after first phoning the property manager to advise her of the flooding. The email read in part:
“We experienced severe leaking through the roof, light fittings, exhaust fans, around the windows and architraves. Both bedrooms were flooded with approximately an inch of water. The walk-in wardrobe in the main bedroom was also flooded, as were the bathrooms, the hallway leading to the 2nd bedroom and a part of the dining/living room.”
Mr Dearn vacated the apartment on 27 February 2007 to stay with friends and family. Mr Chai could not vacate so he “camped” on a foam mattress on the living room floor for 3 weeks as he had to move out of his bedroom. The tenants both moved their possessions out of the bedrooms and stored them in the part of the living area that was not affected by the water. They also stored their possessions on the dining table in the living area.
The carpets were lifted by a tradesperson by 2 March 2007 and the underlay removed. The carpet was dried with fans for about three days. The underlay was replaced and the carpets relayed by 14 March 2007 when the property manager raised a maintenance order for the steam cleaning of the carpets. The carpets were steam cleaned. The tenants stated this all took three weeks to complete, from 27 February to 18 March 2007. The lessor did not dispute this.
During the period from 27 February to 18 March 2007 the tenants argued the apartment was in disarray and their use of it seriously disrupted while their possessions were stored in the living and dining area (including on the dining table) while the carpet underlay was removed, the carpets dried, new underlay installed and the carpet steam cleaned.
Also, according to an email from Mr Dearn to the property manager on 2 March 2007, water had poured out of the light fittings and the light fitting in one bedroom had fallen out of the ceiling and was handing by the electric cord. On 7 March 2007 an electrical tradesperson repaired the light fittings, one of which had been fusing all lights in the apartment when turned on after the storm.
On 9 March 2007 Mr Chai advised the property manager that a tradesperson, Daniel Sergi, sent by the property manager to inspect the ceilings in the apartment, had said the ceilings in both bedrooms were bowed from the weight of the water on the gyprock. The tenant asked the lessor to treat the ceilings as an urgent repair to prevent further damage and/or injury. The tenant also advised that there were water stains across the ceilings of both bedrooms. Mr Sergi apparently told the tenants the apartment was not waterproof; that the window frames needed replacing to prevent water entering, but not until after the roof was fixed. .
10. The second storm on 18 March 2007 flooded a much smaller area in a corner of Mr Dearn’s bedroom. As a result of that further flooding the tenant’s submitted they were so concerned about further flooding they did not restore all their possessions to their respective bedrooms after the three week period. Their possessions were stored in the “small area of the living room not previously affected by water damage”. Mr Dearn said he was going to move back into the apartment on 19 March 2007 but when informed by Mr Chai that there had been further flooding to his bedroom, he believed the apartment was not waterproof and did not move back. The tenants were aware the roof (from where the water had entered) had not been repaired.
11. There were no other repairs to the interior to the apartment undertaken by the lessor: that is, to the cracked window frames, to the ceilings in both bedrooms to remove the water stains and sagging and to the carpet which was “hard” and stained post the water entry on 27 February and 18 March 2007. The tribunal noted the email of Mr Dearn dated 23 March 2007 giving notice to the property managers of a “foul smell” coming from the wet carpet in 2nd bedroom after the second flooding which wet the carpet in the 2nd bedroom. There was no evidence that the carpet was dried in a similar way to the drying carried out after the initial flooding.
12. By email on 20 March 2007 the tenants gave what they termed a notice to remedy to the lessor in respect of the “ceilings, walls and windows”. In an email in reply the property manager said:
“..this is now in the hands of the Body Corporate. Independent Property Group [the property managers] are unable to do anything further until the Body Corporate had (sic) assessed why the damage had occurred in the first place, as this problem needs to be addressed”.
13. The property managers in an email of 23 March 2003 asked the tenants whether they considered a hole needed to be punctured in the ceilings to “realise” (presumably, to “release”) any water in the ceiling. The tenants replied again on 23 March that they did not think the ceiling needed puncturing as it was not currently “heavily sagging”. They stated their concern was to prevent further damage.
14. From an initial email on 8 March 2007 to the property managers, the tenants continually sought a full rental abatement from 27 February 2007 until “such time as our apartment becomes substantially habitable.” Despite a number of further emails to the property manager seeking a response, on 21 March 2007 the property manger asked the tenants put their request in writing so she could forward it to the lessor. The tenant, Mr Chai, obliged by restating the request for abatement in an email dated 21 March 2007. The property manager replied by email on 23 March 2007 saying she needed to take photographs to forward to the lessor. On the same date the tenants attached photographs taken by them after the second flooding of the state of the apartment. The property manager apparently inspected the apartment on 29 March 2007.
15. On 10 April 2007 the tenants emailed the property manager requesting a response concerning their rental reduction request. On 12 April 2007 the property manager replied advising that the owner did not agree to a full rental abatement but was considering a rent reduction. It was not until 27 April 2007 that the property manager advised the tenants the owner did not agree to any rental reduction or rebate.
16. On 27 April 2007 the property managers also advised the tenants the roof had been repaired (2 months after the initial flooding). Mr Dearn stated he moved back into the apartment and his bedroom after 27 April, 2007. Mr Chai stated he did move some of his possessions back into his bedroom after the three week period but not all of his possessions until after 27 April.
17. Both tenants agreed water has not entered the apartment since 18 March 2007. They also stated they are so concerned about further flooding they continue to ensure they are home during storms.
18. Finally, the tenants said there is ongoing damage from the entry of the water that has not been repaired: the ceiling in the main bedroom is bowed from the weight of the water on the gyprock, the ceilings in both bedrooms are water stained, the window frames in Mr Dearn’s bedroom are cracked (which the tenants argued could admit further water) and the carpets are stiff/hard and stained from the water damage. The tenants produced photographs of the stains on the ceilings in both bedrooms and of the marks on the carpet, particularly in the hallway and dining area. The photographs showed serious and unsightly marking on the carpet in both the hallway and the dining area. In the photographs, the stains to the ceilings in both bedrooms appeared to be obvious but not extensive. There did not appear to be a severe discolouration and the sagging was not apparent.
19. The lessor agreed that the tenants were seriously inconvenienced for the three week period from 27 February to 18 March but submitted that a 40% rental reduction was appropriate as one tenant still lived in the apartment. There was access through the apartment on the concrete floors whilst the underlay was taken up and replaced.
20. The lessors further submitted the tenant, Mr Dearn’s fear of further flooding during the period 19 March to 27 April 2007 was not sufficient to justify a further rental reduction of 70% for Mr Dearn. No further water had entered the premises and all parts of the apartment were usable by the tenants from 19 March 2007.
21. The lessor submitted that the tenants were not entitled to any rental reduction after 27 April 2007 when the roof was repaired. There was no further damage after 27 April 2007 and no possibility of further flooding thereafter.
Legislation
22. The lessor’s obligation to carry out urgent repairs is set out in terms 59 and 690 of the standard terms. Only the urgent repairs relevant to this claim are set out:
58 If the premises are a unit under the Unit Titles Act 2001, and the tenant’s use and enjoyment of the premises reasonably requires repairs to the common property, the lessor must take all steps necessary to require the owners corporation to make the repairs as quickly as possible.
59The tenant must notify the lessor (or the lessor’s nominee) of the need for urgent repairs as soon as practicable, and the lessor must, subject to clause 82, carry out those repairs as soon as necessary, having regard to the nature of the problem.
60 The following are urgent repairs in relation to the premises, or services or fixtures supplied by the lessor:
(c) a serious roof leak;
(f) flooding or serious flood damage;
(g) serious storm or fire damage;
(k) a fault or damage that causes the residential premises to be unsafe or insecure;
(l) a fault or damage likely to cause injury to person or property;
23. The lessor’s and tenants’ obligations concerning non-urgent repairs are set out in clauses 55 to 57 of the standard terms:
55 (1) The lessor must maintain the premises in a reasonable state of repair having regard to their condition at the commencement of the tenancy agreement.
(2) The tenant must notify the lessor of any need for repairs.
(3) This section does not require the tenant to notify the lessor about anything that an ordinary tenant would reasonably be expected to do, for example, changing a light globe or a fuse.
56 The lessor is not obliged to repair damage caused by the negligence or willful act of the tenant.
57 Subject to clause 55, the lessor must make repairs, other than urgent repairs, within 4 weeks of being notified of the need for the repairs (unless otherwise agreed).
24. The circumstances in which the tenants can claim a rental reduction for the lessor’s breach of his obligations to repair are provided in section 71 of the Act:
71 (1) On application by a tenant, the tribunal must order a reduction in the rental rate payable under a residential tenancy agreement if it considers that the tenant’s use or enjoyment of the premises has diminished significantly as a result of any of the following:
(a) the loss or diminished utility of an appliance, furniture, a facility or a service supplied by the lessor with the premises as a result of—
(i) …; or
(ii) the failure by the lessor to maintain the premises and any appliance, furniture or facility supplied with the premises in a reasonable state of repair, having regard to their condition at the commencement of the residential tenancy agreement; or
(iii) …;
(b) the loss of the use of all or part of the premises;
(c) ….
(2) To remove any doubt and for subsection (1), a tenant’s quiet enjoyment of premises is interfered with if there is substantial interference with, or a significant lessening of freedom in exercising, the tenant’s rights.
(3) A reduction in the rental rate ordered under subsection (1)—
(a) takes effect from the day the tenant’s use or enjoyment of the premises diminished, or the later date that the tribunal specifies; and
(b) remains in force for the period, not longer than 12 months, specified by the tribunal.
(4) The tribunal may order a lessor to pay to the tenant the difference between the rent paid and the rent payable as a result of an order for a rental rate reduction.
(5) Any purported increase in the rental rate in relation to premises for which a reduction order is in force is void and any amount paid above and beyond the reduced rental rate in accordance with a purported increase is a debt owing by the lessor to the tenant.
Findings and Reasons
25. The tribunal finds that tenant’s fulfilled their obligation to report the need for urgent repairs to the lessor when they reported the flooding to the lessor’s property manager the day after the storm, on 28 February 2007. They also emailed the lessors property agents advising them of the flooding at 10.39am on 28 February 2007. They advised the property manager of the further flooding again on the day after the 18 March 2007.
26. The tribunal finds that the lessor did undertake the urgent repairs to dry out the carpet and underlay in the apartment after the flooding of 27 February 2007 within a 3 week period and that the lessor fulfilled his obligations under clauses 59 and 60 of the standard terms in relation to the carpet. There was considerable flooding though out Canberra form the storm and the three week period fulfilled the obligation to repair “as soon as necessary, having regard to the nature of the problem”.
Period 27 February to 18 March 2007
The tribunal accepted the tenants’ argument that during the period from 27 February to 18 March 2007 that their use of the apartment was significantly diminished. During the time the tenants’ possessions were stored in the living and dining area (including on the dining table), the carpet underlay was removed and the carpets were dried, then during the wait for and relaying of the underlay and carpet, the tenants lost the use of almost all of the premises. Regardless of the fact that Mr Chai believed he had no alternative but to “camp” in a small part of the living area, considering the size of the apartment, this constituted a very substantial interference with the tenants’ quiet enjoyment of the premises and a virtual total lessening of their freedom to exercise their rights as tenants. As such, under section 71 of the Act the tribunal ordered a total rental reduction for this period.
Period 19 March to 27 April 207 for Mr Dearn
28. The next period to consider is that between 19 March and 27 April 2007, the period it took for the roof to be repaired by the Body Corporate. The tenant, Mr Dearn, did not return to occupy the apartment until advised the roof was repaired as he had serious concerns after the second flooding of 18 March 2007 that there would be further flooding to the bedroom he occupied. He claimed a 70% rental reduction for the whole of that period. The tribunal does not accept Mr Dearn’s claim that his fear of further flooding was justified. The second flooding of 18 March 2007 only affected a square meter area of the bedroom Mr Dearn occupied. Whilst that was of concern, it was not sufficient to justify asking the lessor to reduce the rent on the basis Mr Dearn chose to remain away from the apartment.
29. As set out above, under section 71 of the Act, the tribunal can order a rental reduction where the tenant’s use of the premises is diminished significantly as a result of, amongst others, the loss of the use of all or part of the premises. A tenant’s quiet enjoyment of premises is interfered with if there is substantial interference with, or a significant lessening of freedom in exercising, the tenant’s rights. There was no evidence that the time taken from 19 March 2007 for the roof to be repaired directly had this effect on Mr Dearn’s use of the premises. The carpet had been relayed, the lights repaired and the tenants were at liberty to restore their possessions to their respective bedrooms. Mr Dearn’s fear of further flooding was based on the second flood which was very minimal compared to the initial flooding. Whilst the fear may have been real, it does not justify a rental reduction.
Period 19 March 2007 to date and continuing
30. Finally the tenants sought a 20% rental reduction from 28 April to the date the lessor (through the Body Corporate) finalises the remaining repairs to the ceilings and window frames in the apartment to restore it to the condition it was in at the commencement of the tenancy. At the hearing, the lessor advised the tribunal he was informed on 11 July 2007 the insurance company for the Body Corporate had approved the repairs to the ceiling and window frames in the apartment. These will be carried out by the Body Corporate in the near future. The lessor also said he did not know of the problems raised in the proceedings until shortly prior to the hearing.
31. The apartment was a unit within Clause 58 of the standard terms. Therefore, as tenant’s use and enjoyment of the premises reasonably required repairs to the common property, that is the window frames and the ceilings, the lessor had to take all steps necessary to require the owners corporation to make the repairs as quickly as possible. There was no evidence led of the steps taken by the lessor or the property manager concerning the Body Corporate carrying out these repairs.
32. A period of 4½ months elapsed between the initial flooding on 28 February 2007 to 11 July 2007 when the property managers advised that the Body Corporate had approved the repairs. Given that length of time and the lack of evidence of the steps the lessor and/or the property manager took, the tribunal found that the lessor had not fulfilled his obligation under clause 58.
33. As stated above, the tenants produced photographs of the stains on the ceilings in both bedrooms and of the marks on the carpet, particularly in the hallway and dining area, and of the cracks in the window frames. The photographs showed serious and unsightly marking on the carpet in both the hallway and the dining area. In the photographs, the stains to the ceilings in both bedrooms appeared to be obvious but not extensive. There did not appear to be a severe discolouration and the sagging was not apparent. These photographs had been forwarded to the lessor’s property managers by the tenants attached to an email on 23 March 2007.
34. The tribunal also notes that the tenant Mr Dearn had to suffer a “foul smell” in his bedroom from the wet carpet after the second flooding. The carpet appeared not to have been dried by fans as occurred after the initial flooding.
35. Again, the length of time, from the initial flooding and from the notification of the need for repairs to the ceilings and window frames, to the actual repairs being carried out by the Body Corporate being approximately 4½ months, the tribunal found that the lessor had not fulfilled his obligations to carry out non-urgent repairs under section 71(1)(a)(ii) of the Act. The repairs were necessitated by the flooding and were needed to restore the premises to its condition at the commencement of the tenancy.
36. The tenant’s use and enjoyment of the apartment was diminished significantly as a result of the lessor’s failure to maintain the premises in a reasonable state of repair. As a result, the tribunal decided the lessor was to give the tenants a rental reduction under section 71(1)(a)(ii) of the Act. The reduction to be 20% of the rent, amounting to $74 per week, from 19 March 2007 to the date when the repairs are carried out to the ceilings and window frames by the Body Corporate.
37. Alternatively, the tribunal was of the opinion that the lessor should pay compensation of that amount per week to the tenants for the same period under section 104(d) of the Act for the breach by the lessor of his obligation under clause 55 of the standard terms, to maintain the apartment in “a reasonable state of repair having regard to their condition at the commencement of the tenancy agreement”. The requirement for the tenants to report any need for repairs under the same clause 55 was fulfilled by the tenants in relation to the flooding, the ceiling in both bedrooms sagging and stained, the cracked window frames and the remaining problem with the carpet being hard and still showing stains from the flooding. Thereafter, the lessor had to make the notified repairs, not being urgent repairs, within 4 weeks of the notification unless otherwise agreed. The tenants did agree that the “puncturing of a hole in the ceilings” was not necessary as the ceilings did not sag heavily. Otherwise they continued to press for the repairs to be undertaken.
38. Whilst the tribunal was sympathetic to the lessor who expressed anger at the position in which he had been placed, the tenants should not bear the burden of the lessor having to rely upon his property manager and the delay of the Body Corporate. The lessor may consider taking any action available to him to seek reimbursement for the compensation or rental reductions the tribunal has ordered.
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