Shields v Deliopoulos
[2016] VSC 500
•7 September 2016
| IN THE SUPREME COURT OF VICTORIA |
AT MELBOURNE
COMMON LAW DIVISION
JUDICIAL REVIEW AND APPEALS LIST
S CI 2015 01948
| VIKKI SHIELDS | Plaintiff |
| v | |
| PETER DELIOPOULOS | Defendant |
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JUDGE: | Daly AsJ |
WHERE HELD: | Melbourne |
DATE OF HEARING: | 18 April 2016 |
DATE OF JUDGMENT: | 7 September 2016 |
CASE MAY BE CITED AS: | Shields v Deliopoulos |
MEDIUM NEUTRAL CITATION: | [2016] VSC 500 |
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JUDICIAL REVIEW AND APPEALS – Appeal from Victorian Civil and Administrative Tribunal – Claim by tenant for compensation for breach of s 68 of Residential Tenancies Act 1997 (Vic) – Obligation of landlord to ‘ensure that the rented premises are maintained in good repair’.
LANDLORD AND TENANT – Content of obligation of landlord to ensure rented premises are maintained in good repair – Meaning of ‘ensure’ – Meaning of ‘maintain’ – Meaning of ‘good repair’ – Standard of good repair not referable to condition of premises at commencement of tenancy or level of rent payable – Gration v C. Gillan Investments Pty Ltd (2005) 2 QdR 267 and Kneuppel v Zarpas [2004] SADC 162 referred to – In order to ‘maintain premises in good repair’ it is necessary to put premises in good repair – Payne v Haine (1847) 16 M&W 541, Proudfoot v Hart (1890) 25 QBD 42 referred to – ‘Repairs’ v ‘improvements’ Australian Mutual Provident Society v 400 St Kilda Road Pty Ltd [1990] VR 646 followed – Landlord and tenant cannot contract out of their obligations and duties under the Act – Section 1, s 27(1) of the Residential Tenancies Act 1997 (Vic) – Appeal allowed.
APPEALS FROM TRIBUNALS – Findings of fact where there was no evidence to support the finding – Decision illogical – Finding of fact where parties had not been provided with an opportunity to address the finding – Commissioner of theAustralian Capital Territory Revenue v Alphaone Pty Ltd (1994) 49 FCR 576 referred to and applied – Appeal allowed.
PRACTICE AND PROCEDURE – Whether permissible for tribunal member to make a global finding that landlord had complied with repair obligations – Mulligan v National Disability Insurance Agency (2015) 146 ALD 418 referred to – Imposition of inflexible rule regarding conduct of VCAT proceedings undesirable – Ground of appeal not made out.
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APPEARANCES: | Counsel | Solicitors |
| For the Appellant | Mr C Horan QC with Ms L Martin | Victoria Legal Aid |
| For the Respondent | In person |
HER HONOUR:
Background
This appeal concerns, among other things, a fundamental aspect of the law governing the relationship between landlords and tenants in Victoria: the nature and content of the obligation of a landlord to ensure that premises are ‘maintained in good repair’.
In June 2014, the plaintiff in this proceeding, Ms Vikki Shields (‘tenant’) issued a proceeding in the Residential Tenancies List of the Victorian Civil and Administrative Tribunal (‘VCAT’) against the defendant, Mr Peter Deliopoulos (‘landlord’) seeking, among other things, compensation under s 452 of the Residential Tenancies Act 1997 (Vic) (‘RTA’) for the landlord’s alleged breaches of s 68 of the RTA. In her application, which was prepared with the assistance of solicitors employed by Victoria Legal Aid, the tenant stated as follows:
The applicant seeks orders under s 452 of the RTA for compensation as a result of the landlord’s failure to comply with the tenancy agreement, and their duties under the RTA.
The applicant alleges that the respondent breached s 68 of the RTA by failing to ensure that the rented premises were maintained in good repair both at the start of the tenancy, and for the duration of the tenancy.
The applicant alleges that the respondent breached s 65 of the RTA by failing to provide the premises in a reasonably clean condition on the date that the applicant moved in.
The applicant seeks compensation of $50.00 per week for loss of amenity in the premises throughout the duration of the tenancy. The tenancy begun on 13 June 2008 and ended on 1 November 2013. The total amount of compensation sought is $14,050.
In her application, the tenant identified a number of ‘repair issues’ with respect to the property at 128 West Boundary Road, Port Albert (‘premises’). Some of the repair issues were apparent at the commencement of the tenancy, which is evidenced by a condition report prepared at the commencement of the tenancy.[1] Others emerged during the course of the tenancy, which ran for some five and a half years. The tenant provided the following particulars of repair issues associated with the premises:
[1]Subject to certain conditions, s 36 of the RTA provides that a condition report signed by or on behalf of a tenant and a landlord is conclusive evidence of the condition of rental premises.
1. Holes in walls and floors and water damage to front balcony area
Three of the properties seven rooms had holes in either the ceiling or floor at the beginning of the tenancy. The bathroom had a hole in the floor, one of the bedrooms a hole in the roof and the laundry had a hole in the roof. There was water damage to the rooms that had holes in the roof. As a result, one of the bedrooms was unusable. In addition, the front balcony was also leaking badly causing severe water damage to the floor area on the front balcony.
2.Flooding, dampness and rot caused by location of property and multiple flood events on the land
The property is zoned in an area with a ‘floodway overlay’ due to its location. In winter the land was regularly inundated with water which would fully cover the ground. This would either be due to rain or a rise in the water levels in the area.
As a result, the property was damp all of the time, with much of the woodwork rotting and damp carpet. The house was also sinking in the right hand corner. The bath was sinking due to the rotten floor. In addition the land around the property was unusable for parts of the year due to water.
The applicant was not told that the property was in an area prone to flooding when she entered the tenancy. Proper maintenance was not done on the house to minimise the impact or effects of the flooding.
3. Mould
At the start of the tenancy, the property had significant mould on the ceiling and walls in all but two rooms. The mould was in the lounge room, bathroom, kitchen and two of the three bedrooms. There was a permanent associated smell which permeated the house, clothes, sheets and bed. The applicant’s personal possessions became mouldy as well, including drapes, shoes, clothes, and blankets. Mould was scrubbed back by the applicant, but would return.
4. Rats and other pests
Due to the poor state of repair of the property there was constant access to the property by rats and other pests. When the tenant first moved in there was rat bait and rat faeces in a number of rooms. The cupboards in the kitchen were unusable due to a constant presence of rats. The top of the oven was discovered to be a nesting place for mice.
5. Electrical wiring
There were a number of concerns with the wiring addressed in a report by an inspector dated 6 June 2011. These were of particular concern to the applicant given that there was issues with flooding in the roof, and access by rats and other vermin to the wiring in there. In addition, the smoke alarm did not work.
6. Faults with doors and windows
Four of the doors were damaged or rotting, and were unable to function properly. Two of the doors were replaced in 2012. Two of the windows also broke during the tenancy. In 2008 the kitchen window broke during a storm, and was replaced in 2012. The lounge room window fell out due to rotting in the frame and was fixed in late 2012.
7. Fixtures and appliances not in working order
Many of the appliances and fixtures were not in working order. The clothes line in the back garden had no wire on it for hanging clothes, the wash trough in the laundry had broken away from the wall, the dishwasher had been disconnected and placed in the laundry and was not working. The kitchen cupboards were filthy and stained with rat urine and faeces, and were as such unusable. There were no seals on the oven. The hot water system was faulty from the start and took more than three months to replace. The smoke alarm did not work and was not fixed until 2013. The original heater had serve issues causing leaking gas, and was replaced in 2010. The replacement heater was unsuitable for the house, and was replaced in 2013.
8. Property unclean when moved in
All of the rooms in the property were very dirty when the applicant moved in. the applicant cleaned the property herself, and was never reimbursed for her time or expenses. In addition the previous tenant’s items had not been removed, including sheepskins in the oven, pornographic films, and obscene pornographic imagery stuck on one of the doors.
9. Shed collapse and removal and problems with fencing
The applicant was attracted to the property because it had a shed with a concrete base and secure fencing. She needed this space for her greyhounds. During a storm within the first three months, the shed collapsed. The applicant contacted the agent the next day to request that the pieces of the collapsed shed be removed, and a replacement shed be installed. The remains were removed in September 2008, but the shed was never replaced.
In addition the fencing deteriorated throughout the tenancy.
There was no real dispute at the hearing at VCAT, or before this Court, that the premises were in poor condition. No defence was filed with VCAT by either the landlord, or the landlord’s real estate agent, Mr David Foat, who had been joined as a party to the VCAT proceeding by the tenant. Instead, at the hearing before VCAT, at which the tenant, the landlord, and the real estate agent were all present, the real estate agent produced a bundle of documents, including a document headed “Timeline of Repairs conducted at 128 West Boundary Road Port Albert & Correspondence between Landlord Peter Deliopoulos (‘Landlord’) and agent (‘Landmark’)”, receipts for work and labour done at the premises during the course of the tenancy, and correspondence between the landlord and the real estate agent regarding repairs to the premises. These documents establish that the landlord spent some $10,498 effecting repairs to the premises over the course of the tenancy. It appears from the correspondence that the landlord was reluctant to carry out maintenance and repair works at the premises. On 17 June 2010, the landlord wrote to the real estate agent in the following terms:
Further to the conversation last week regarding above rental property that no further repairs to the property will be done. The only maintenance that will be done is of an urgent matter that concerns essential services to the property and to the safety of the tenant/property.
I understand that you have spoken to the tenant Vikki Shields and she is aware of the above.
The only other recourse is to terminate the tenancy, but Vikki Shields has requested that she be allowed to remain in the property at the said rental price while this tenancy is in place at 128 West Boundary Road, Port Albert.
Could you please have Vikki Shields confirm this agreement in writing.
The circumstances in which the tenancy ended are a little unclear: during the course of the hearing at VCAT, the tenant stated that she was given notice to vacate after she asked for more repairs to be done at the premises. This was not expressly denied by the landlord (who was not called upon to give evidence during the course of the hearing). However, this issue is not of great significance, at least for the purposes of this appeal.
The decision at VCAT
The hearing of the VCAT proceeding was held on 26 November 2014, before Member Lightfoot (‘Tribunal Member’). While Victoria Legal Aid prepared written submissions on the tenant’s behalf in advance of the hearing, it did not provide or fund legal representation for the tenant at the hearing. The tenant appeared on her own behalf, assisted by a lay support person, the landlord and real estate agent represented themselves, and the property manager of the real estate agency also appeared. At the conclusion of the hearing, the Tribunal Member made the following orders:
The application is dismissed for the following reasons (sic):
The tenant has not established that the landlord was in breach of his duty in respect of the maintenance of the property.
At the request of Victoria Legal Aid, the Tribunal Member prepared written reasons, which were completed the day after the hearing. In the reasons, the Tribunal Member:
(a) set out, in brief terms, the history of the tenancy and the tenant’s claim in the VCAT proceeding;
(b) reproduced sections 65 and 68 of the RTA, and noted that these provisions are ‘duty provisions’, the breach of which entitles a tenant to claim compensation;
(c) summarised the evidence given by the tenant to the effect that the tenancy agreement was originally advertised at a rental price of $100 per week, but that the original co‑tenant, Mr Shane Boyce, agreed to pay $125 per week for an initial term of six months. The rent remained unchanged until the end of the tenancy some five and a half years later. The Tribunal Member saw no reason to doubt the tenant’s evidence that she was desperate at the time she commenced occupying the premises;
(d) noted the statement in the condition report that the premises were ‘in a poor state in need of minor and major repairs, but nothing that can’t be fixed by Shane Boyce if owner allows’;
(e) noted that Mr Boyce did not attend the hearing, so that the intentions of the parties at the time must be inferred from the available evidence;
(f) inferred from the statement in the condition report referred to above and the fact that the tenant did not serve a breach of duty notice under s 208 of the RTA that the tenant, or Mr Boyce at least, had come to some agreement absolving the landlord from undertaking the works required; and
(g) at paragraphs 14 to 20 inclusive of the reasons, the Tribunal Member stated as follows:
Section 68(1) requires a landlord to ensure that the rented premises are maintained in good repair and is also a duty provision, but again no breach of duty notice seem to have been given. Nonetheless the landlord is required to take reasonable steps to ensure the premises are maintained in good repair. At its lowest level this obligation is one of keeping the premises in a safe state of repair to avoid injury to its occupants. This is the common law duty as stated in Jones v Bartlett (2000) 176 ALR 137. It is clear that the obligation imposed by Section 68 goes beyond basic safety issues when it is read in the context of the provision of Division 6 of the act concerning ‘urgent’ and ‘non urgent’ repairs. ‘Urgent’ repairs are defined in Section 3 of the Act. ‘Non Urgent’ repairs are not so defined and what is reasonably required must be determined by an examination of all aspects of the tenancy agreement. It cannot, either logically or equitably, impose an obligation on a landlord to upgrade the standard of the premises, during the course of a tenancy, without there being a commensurate increase in rental. In this context, it is relevant to note that there was no increase in the rental during the 5½ year term of the tenancy.
The applicant commenced her action against the landlord on the 6 June 2014 the 5½ year tenancy having ended on the 6 November, 2013.
Many of the applicant’s criticisms of the landlord’s maintenance of the property related back to its condition at the commencement of the tenancy agreement and in respect of which the tenant had taken no prior action to enforce any rights she might, or might not, have had under the Act. Certainly, the property was not upgraded during the tenancy, but no evidence was available as to what Mr Boyce had agreed to, and the rent remained unchanged throughout the whole 5½ year period.
The applicant also asserted that when, during the tenancy, repairs became necessary, the landlord either didn’t attend to them, or took an unreasonably long time to effect them.
Mr Foat, the joined party, and the former managing agent, produced a timeline of repairs conducted at the property from 10 July 2008 to the 7 August 2013 together with relevant invoices totalling $10,498. He agreed that some repairs took longer than was desirable, but stated that this was not the result of any tardiness on the part of the landlord, but because there were few tradesmen at Port Albert and it was sometimes difficult to get tradesmen to come there.
On this basis of the available evidence, I found that the landlord had fulfilled his obligation under the Act and that, therefore, no compensation was payable.
The Appeal
The tenant brings her appeal under s 148(1) of the Victorian Civil and Administrative Tribunal Act 1998 (Vic) (‘VCAT Act’). The Notice of Appeal dated 25 June 2015 identified the following questions of law and grounds of appeal.
QUESTION OF LAW
1.Whether the Tribunal erred in law in its interpretation of section 68 of the Residential Tenancies Act 1997 (Vic) (the Act).
2.Whether the Tribunal was required at law to consider each of the repairs issues put to it.
3.Whether the Tribunal erred in law by taking into account irrelevant considerations when determining whether the Respondent was in reach of the duty at section 68 of the Act.
4.Whether the Tribunal made a finding in relation to an agreement between the co‑tenant of the Appellant, and the Respondent, about whether repairs would be addressed that was not available on the evidence.
GROUNDS OF APPEAL
1.That the Tribunal misconstrued the term ‘must ensure the premises are maintained in good repair’ in section 68 of the Act by:
a.Limiting the scope of the duty with reference to:
i.the condition of the property when the Appellant took possession, and
ii.an examination of ‘all aspects of the tenancy agreement’.
b.Determining that the duty applied differently to repair issues that arose during the course of the tenancy agreement as distinct from existing faults when the Appellant took possession.
c.Determining that the duty required only that the Respondent maintain the property in the state of repair in existence at the commencement of the tenancy agreement, irrespective of whether that was ‘good repair’.
d.Finding that addressing repair issues from the commencement of the tenancy agreement would be considered an ‘upgrade’ of the premises.
2.That the Tribunal failed to consider instances of repair issues said to demonstrate breaches of section 68 of the Act.
3.That the Tribunal had regard to the following considerations that were not relevant for the purpose of determining whether the Respondent breached section 68 of the Act, namely:
a.Whether the repair issue was present at the start of the tenancy or emerged during the course of the tenancy.
b.The rate at which the property was initially let.
c.The absence of any rent increases during the duration of the lease.
4.That the Tribunal erred by making a finding of fact, that there was ‘some agreement with the landlord concerning the absolving the landlord from undertaking the works required’, when it was not open on the evidence considered by the Tribunal.
At the commencement of the hearing, leave was sought to add an additional question of law ground of appeal. The proposed question of law is:
Whether the Tribunal failed to accord procedural fairness in relation to its finding that there was an agreement between the co-tenant of the appellant and the Respondent about whether certain works would be undertaken by the Respondent
and the related ground of appeal is that:
The Tribunal erred by failing to accord procedural fairness in making a finding or inference of fact that the co-tenant had ‘come to some agreement with the landlord absolving the landlord from undertaking the works required’ in that the Tribunal did not:
(a)notify the Appellant of the proposed finding and give her an opportunity to be heard on that issue;
(b)make enquiries of or hear available evidence from the Respondent or the joined party as to the existence, or terms, of any such agreement.
For the avoidance of doubt, leave is granted to amend the notice of appeal.
In the written and oral submissions made on behalf of the tenant, the Tribunal Member is said to have made a number of errors of law, in particular that the Tribunal Member erred in its interpretation of s 68 of the RTA. More specifically, it was submitted that the Tribunal Member misconstrued the nature of a landlord’s obligation to maintain rental premises in good repair, and that the Tribunal Member erred in law by taking into account irrelevant considerations when determining whether the landlord was in breach of the duty imposed by s 68 of the RTA. These irrelevant considerations were said to be the time at which repair issues arose, the level of rent charged for the premises and whether there had been rental increases over the course of the tenancy.
Senior counsel for the tenant submitted that the Tribunal was required at law to consider each of the repair issues put before it, rather than make what was described as a ‘global finding’ to the effect that the landlord had carried out the necessary repairs.
Senior counsel for the tenant further submitted that the Tribunal’s decision was based on a finding that was not open to it on the evidence, namely that the tenant and/or her previous co‑tenant, Mr Boyce, agreed to absolve the landlord of responsibility to undertake action required to ensure that the premises were maintained in good repair.
The landlord did not file any formal written submissions, but sent two letters to the Court defending his conduct and the Tribunal Member’s decision and reasons. In a lengthy letter the landlord explained, based in part upon what he was told by the real estate agent, his reasons for letting the premises to the tenant and Mr Boyce, and his reasons for ultimately ending the tenancy. According to the landlord, he was sympathetic to the tenant’s personal circumstances, as in the months prior to the commencement of the tenancy she had been living out of a car. He and the real estate agent had tried to assist the tenant by allowing her to stay at the premises, carrying out essential repairs, and not increasing the rent. He believed that the tenant was always dealt with respectfully, and he let her stay after he determined to spend no further funds on repair of the premises, because she pleaded to stay in the premises. When he did decide to end the tenancy, he allowed her some extra time to vacate the premises. In the letter, he stated as follows:
Perhaps in summary:-
·Shane, Vikki and Vikki’s case worker had inspected the property, saw it for what it was and had willingly agreed to rent it, look after it and live in it.
·At the time of the inspection (13/06/08) it was noted that the place needed… ‘minor and major repairs but nothing that can’t be fixed by Shane Boyle if owner allows’.
·If what they found when they moved in was not what they’d seen the days before then they should have raised these false representations at the time, or at least some time in the last 5 years.
·If Vikki was unable to her case worker could and should have raised any concerns and found Vikki better accommodation. We pushed for this over the years yet the case workers did nothing.
The letter also stated that he believed that the tenant had a fair hearing at VCAT, and that at the hearing the tenant acknowledged that on the occasions where she requested repairs be made he had responded quickly and attended to the works. The landlord concluded his letter as follows:
In the end though, I am comfortable that I have done as much as I could to help Vikki in her circumstances to settle and have enough time to find a better place. It is in my nature to help and stand up for the vulnerable and I find the allegations made against me distressing and offensive.
While I appreciate the need to protect people from predatory behaviour and there will obviously be arguments presented on precedence (sic) I hope that whatever ruling your Honour makes it will not preclude or penalise people with good intent, open the door to retrospective litigation, nor remove peoples freedom to enter into reasonable arrangements of their free choice.
A few days before the hearing of the appeal, the landlord sent a further letter to the Court, the contents of which are reproduced below:
I am a party to these proceedings through no fault of my own. I find it unusual to be here as a defendant for someone else’s ruling which is being challenged though I understand that that’s the way the law works.
Not having caused this situation the one thing that I would like your Honour to consider is not awarding costs against me if the judgment goes in favour of the Plaintiff and I’d also ask the Plaintiff’s counsel not to oppose my request, too vigorously, as Miss Shields would not incur the costs herself and be out of pocket.
With regard to this matter and perhaps this is irrelevant to the specific question and arguments around the ruling made by VCAT I’d like to note (the bleeding obvious I know) that whatever ruling is made today will create a precedent for other to rely on. While I expect that your Honour will be mindful of this I’d like to note that not all tenants are good nor all landlords bad and conversely not all tenants are bad and all landlords good.
For my part I feel that what I did with the rental was intended to help yet I find myself in this situation. I do not raise this as a defence but simply make the point to highlight that there will be intended and unintended consequences that flow to both landlords and tenants of your ruling.
Your Honour my case will be resolved today or through another hearing at VCAT and in one way or another it will end. My concern is that sometimes rulings with great intent have unexpected consequences and I simply ask that the court be mindful of it is I am sure it will be. My thoughts may be out of place but I raise this in good faith so that tenants and landlords are not couched as adversaries and in good faith decisions and agreements made between them aren’t dismissed too easily.
I’ll finish with that your Honour and I ask for your forgiveness if I have spoken out of term (sic).
The landlord’s brief oral submissions at the hearing largely reflected the contents of these letters. The landlord also submitted that he believed that the tenant had been given a fair hearing at VCAT.
At the commencement of the hearing of the appeal, senior counsel for the tenant stated that he did not want to unduly focus upon the conduct of the landlord, but rather, the manner in which the Tribunal Member misconstrued the relevant provisions of the RTA. Having read the transcript of the hearing below, read the letters summarised above, and heard from the landlord at the hearing of the appeal, I agree that any undue criticism of the landlord personally is unwarranted.
In this appeal, the tenant seeks the following orders:
(a) that the Tribunal order made R2014/25742/00 be set aside;
(b) that the matter be remitted to the Tribunal newly constituted for hearing and determination in accordance with the law; and
(c) that the respondent pay the appellant’s costs of this appeal.
Grounds of Appeal 1 and 3
While the tenant has identified a number of questions of law and relies upon a number of grounds of appeal, the main focus of senior counsel’s submissions was what was said to be the Tribunal Member’s erroneous construction of s 68 of the RTA. Not only was this fundamental to the determination of the tenant’s claim, but, given that other tribunal members have adopted a similar approach in other tenancy disputes,[2] the proper construction of s 68 is a matter of some public importance. That said, the tenant pressed each of the grounds of appeal, but they are mostly relevant to the circumstances of this particular case rather than concerning broader issues of principle.
[2]For example, in T v Director of Housing (Residential Tenancies) [2013] VCAT 2195, a tribunal member referred to not being ‘satisfied that the landlord failed to take all reasonable steps to comply with the duty to maintain the premises in good repair.’ In Kerr-Lubelski v The Landlord (Residential Tenancies) [2015] VCAT 326, a tribunal member dismissed a claim against a landlord for breach of s 68 largely on the same basis as the Tribunal Member in the current case, that is, the defects were evident when the tenant took possession, and the condition of the property was reflected in the rent paid for the property.
Grounds of appeal 1 and 3 are related. Ground 1 focusses on what was said to be an erroneous construction of a landlord’s obligations under s 68 of the RTA by limiting the scope of the duty by reference to the condition of the premises at the commencement of the tenancy, and determining that the duty only required a landlord to maintain the premises in the state of repair in existence at the commencement of a tenancy, irrespective of whether that was ‘good repair’. Further, in determining whether the landlord had breached his obligations under s 68 of the RTA, the Tribunal Member took into account irrelevant considerations, such as the timing of when repair issues arose, and the rent payable at inception and during the course of the tenancy.
Section 68 of the RTA provides as follows:
68. Landlord’s duty to maintain premises
(1)A landlord must ensure that the rented premises are maintained in good repair.
(2)A landlord is not in breach of the duty to maintain the rented premises in good repair if –
(a)damage to the rented premises is caused by the tenant’s failure to ensure that care was taken to avoid damaging the premises; and
(b)the landlord has given the tenant notice under section 78 requiring the tenant to repair the damage.
(3)If a landlord owns or controls rented premises and the common areas relating to those rented premises, the landlord must take reasonable steps to ensure that the common areas are maintained in good repair.
Senior counsel for the tenant submitted that the duty imposed upon a landlord by s 68 of the RTA entails an obligation to put the premises into good repair at the commencement of the tenancy, and then to maintain them in good repair throughout the duration of the tenancy. The Tribunal Member was in error by:
(a) ignoring the repair issues which were evident at the commencement of the tenancy, as evidenced by the condition report. These repair issues constituted ‘an absence of good repair’ which the landlord was obliged to address;
(b) characterising any action to address the repair issues at the inception of the premises as an upgrade of the premises rather than as meeting the landlord’s obligation to maintain the premises in good repair;
(c) finding, in effect, that the tenant had somehow absolved the landlord of his obligations under s 68 of the RTA by remaining in occupation of the premises; and
(d) determining that what amounted to good repair was relative to the condition of the premises at the commencement of the tenancy, the rent payable for the premises, and the absence of any rent increases.
Senior counsel for the tenant submitted that if the Tribunal Member’s approach to the construction of s 68 of the RTA is accepted, that would introduce a dangerous and unwarranted level of relativity into the regulation of the standard of repair in which rental premises should be maintained. Relating the obligations of landlords to maintain rental premises in good repair to the level of rent payable for particular premises is inconsistent with the consumer protection focus of the RTA. Further, such a construction would be inconsistent with residential tenancies legislation in other Australian jurisdictions, each of which, in different form, expressly specify the obligations of landlords at the commencement of, and during the course of the tenancy.
Senior counsel for the tenant submitted that the statement of the Tribunal Member in the reasons that ‘the landlord is required to take reasonable steps to ensure the premises are maintained in good repair’ is not correct. Rather, s 68 of the RTA mandates that a landlord must ensure the premises are maintained in good repair. Further, while the Tribunal Member correctly recognised that the obligations upon a landlord with respect to ‘good repair’ exceeds the standard imposed by the common law duty of care, the Tribunal Member was in error in stating that what is reasonably required of a landlord must be determined by an examination of all aspects of the tenancy agreement, including the rent payable for the premises, and the condition of the premises at the start of the tenancy.
Senior counsel for the tenant submitted that the absence of any rental increases should not be relevant to determining what amounts to good repair, and in any event, cannot be relevant to whether the premises were in good repair at the commencement of a tenancy. Finally, the Tribunal Member was wrong to say that the tenant’s failure to take action to enforce her rights with respect to the landlord’s breach of his obligations somehow amounted to a waiver or acquiescence on her part. Her failure to take action might be relevant to the question of compensation, but not whether the landlord had breached his obligations under the RTA.
Senior counsel for the tenant also relied upon certain observations and remarks of the Tribunal Member made during the course of the hearing to support his submissions that the Tribunal Member had fixed in his mind that first, the landlord was not obliged to address repair issues evident at the commencement of the tenancy, secondly, that the level of rent was relevant to the content of the landlord’s obligations under s 68 of the RTA, and thirdly, that the fact that the tenant remained at the premises for over five years somehow absolved the landlord of any breach of duty. Examples of these remarks and observations include the following:
(a) the statement that ‘it seems to me that the lease is entered into … for a place that’s in … very poor condition, but it’s a very low rent’;[3]
[3]T11, 19-23.
(b) the statement that ‘but the tenant elects to stay there for … five years: well the tenant didn’t leave any way for five years’;[4]
[4]T11, 27-30.
(c) the statement that ‘so the tenant has been given a concession all the way through this tenancy. Presumably there was an acknowledgement by the landlord that the place is in poor nick … but it was in poor condition at the start. There has to be, for compensation to be payable there has to be established that the landlord is in breach of his duty. Well if the place is in poor condition and is accepted by the tenant in poor condition … and the landlord agrees to take low rent from the word go and keep it at that at five years’;[5]
[5]T12, 8-21.
(d) the statement that ‘well if they were going to do repairs they’d be done before it was rented and the rent would go up. Or, it would be on the basis that when the repairs are done the rent is going to go up to a commensurate market rental. That didn’t happen so it seems to me there’s a presumption that this place was going to stay in that condition’;[6]
[6]T22, 21-27.
(e) the question ‘now what I’m asking is what problems, what additional problems arose during the course of the tenancy? Not the existing stuff’;[7]
[7]T23, 2-4.
(f) the statement that ‘yes, I think most of these problems were like that when you first moved in’;[8]
(g) the statement that ‘you have to establish that a landlord is in breach of his duty. As I said, the house was run down, liveable but run down, liveable but run down, the rent was very cheap. From time to time you wanted repairs done, and there’s a list here. They were done’;[9] and
(h) having looked at a video taken of the premises at the end of the tenancy, the Tribunal Member stated, ‘the place looks run down, but accords with the description of the property in the condition report that was prepared five years earlier’.[10]
[8]T41, 7-8.
[9]T48, 3-8.
[10]T49, 14-16.
Senior counsel for the plaintiff submitted that the following statement by the Tribunal Member, made towards the conclusion of the hearing, clearly illustrated the error in the Tribunal Member’s approach to the construction of s 68 of the RTA:
There do seem to have been a lot of repairs done. The obligation of the landlord under s 68 of the Residential Tenancies Act is to ensure the rented premises are maintained in good repair, which is really repair commensurate with the position at the start, not upgraded during the course of the tenancy unless the rent is going up. And we’ve noted that the rent stayed at 125 for the whole five years.[11]
[11]T48, 19-26.
Senior counsel relied upon a number of authorities to support his submissions with respect to the proper construction of s 68. While none of these authorities, which are referred to in more detail in the following paragraphs of these reasons, concern the interpretation of the RTA, I agree they provide useful guidance as to the obligations imposed upon landlords under s 68 of the RTA.
I agree that the Tribunal Member misconstrued the landlord’s obligations under s 68 of the RTA, and took into account irrelevant considerations in determining that the landlord had not breached his obligations to maintain the premises in good repair. In particular, I accept that the duty imposed upon a landlord to ‘ensure that rental premises in good repair’ is strict and absolute, and imposes an obligation upon a landlord to identify and rectify any defects of which they are aware or ought to be aware. In the current case, the question of whether the landlord was on notice of any defects does not arise, given the condition report prepared at the commencement of the tenancy, which provided copious details of the repair issues at the premises.
The strict obligation imposed by s 68 is consistent with the presence of the word ‘ensure’ in s 68 of the RTA, which the authorities suggest is synonymous with ‘make sure’.
In Gration v C. Gillan Investments Pty Ltd,[12] the Queensland Court of Appeal considered the content of the obligation of a landlord under that State’s residential tenancies legislation to ensure that the premises were in good repair at the commencement of a tenancy. Williams JA noted that the dictionary definition of ‘ensure’ was ‘make sure, convince, … make certain the occurrence of an … outcome.’ He later went on to state:
To the best of my researches only Vaisey J has provided a judicial definition of the term ‘ensure’ when used in a statute. In Reliance Permanent Building Society v Harwood-Stamper [1944] Ch 362 at 373 he said, speaking of the term ‘ensure’ used in s 10 of the Building Societies Act 1939 (UK):
The word ‘ensure’ has puzzled me a good deal. I think it is used in the common and colloquial sense in which ‘making sure’ is used, that is, as equivalent to ascertaining or satisfying oneself, and does not mean anything in the nature of warranty or guarantee.
With respect, I agree with that approach, and would give the word when used in s 103(2) of the 1994 Act the same meaning. On that approach s 103(2) obliges the lessor to take steps to ascertain and satisfy himself that the premises are in a state of good repair at the start of the tenancy; the lessor cannot sit back and say that as the previous tenant has not complained of any defect therefore the premises must be in a state of good repair. The use of the term ‘ensure’ obliges the lessor to take reasonable steps to ascertain and satisfy himself that the premises are in good repair at the start of the tenancy.
[12](2005) 2 QdR 267.
His Honour adopted with approval the following statement of Judge Kitchen of the South Australian District Court in Kneuppel v Zarpas:[13]
If that is the sense in which ‘ensure’ is used in s 68 then before the tenancy begins the landlord (or at least some person on his behalf) must inspect the premises to ascertain the state of repair in order that the landlord is in a position to make sure they are in a reasonable state of repair at the beginning of the tenancy. That state of disrepair which such an inspection would reveal to a reasonable observer, the landlord has notice of.
[13][2004] SADC 162.
Finally, after considering the authorities concerning the obligations of a landlord at common law, his Honour went on to conclude:
All of that to my mind reinforces the conclusion that the obligation imposed by the 1994 Act to ensure that at the start of the tenancy the premises are in good repair obliges the landlord, prior to the commencement of the tenancy, to inspect the premises to ascertain the state of repair in order that he is in a position to discharge the duty imposed on him by the statute.
Of course, the relevant Queensland and South Australian provisions differ from s 68 in that they impose separate duties upon landlords at the commencement of the tenancy and during the course of the tenancy. Indeed, only the RTA imposes what might be described as a ‘composite duty’. Indeed, as observed by senior counsel for the tenant, ‘s 68 has a lot of work to do’.
Support for the proposition that in order to maintain premises in good repair during the course of a tenancy it must be necessary to put them in good repair in the first place is to be found in the decision of Payne v Haine,[14] where Baron Parke made the following observations concerning the proper construction of a covenant in a lease to ‘keep premises in good repair’:
If, at the time of the demise, the premises were old and in bad repair, the lessee was bound to put them in good repair as old premises; for he cannot ‘keep’ them in good repair without putting them into it. He might have contracted to keep them in the state in which they were at the time of the demise. This is a contract to keep the premises in good repair, as old premises; but that cannot justify the keeping them in bad repair because they happened to be in that state when the defendant took them. The cases all shew that the age and class of the premises let, with their general condition as to repair, (a) may be estimated, in order to measure the extent of the repairs to be done. Thus, a house in Spitalfields may be repaired with materials inferior to those requisite for repairing a mansion in Grosvenor-square; but this lessee cannot say he will do no repairs, or leave the premises in bad repair, because they were old and out of repair when he took them. He was to keep them in good repair, and in that state, with reference to their age and class, he was to deliver them up at the end of the term.
[14](1847) 16 M & W 541, 544.
The approach of Baron Parke in relation to a covenant to keep premises in ‘good tenantable repair’ was endorsed in Proudfoot v Hart,[15] where Lord Esher MR stated as follows:
What is the true construction of a tenant’s contract to keep and deliver up premises in ‘tenantable repair’? Now, it is not an express term of that contract that the premises should be put into tenantable repair, and it may therefore be argued that, where it is conceded, as it is in this case, that the premises were out of tenantable repair when the tenancy began, the tenant is not bound to put them into tenantable repair, but is only bound to keep them in the same repair as they were in when he became the tenant of them. But it has been decided – and, I think, rightly decided – that, where the premises are not in repair when the tenant takes them, he must put them into repair in order to discharge his obligation under a contract to keep and deliver them up in repair. If the premises are out of repair at any time during the tenancy the landlord is entitled to say to the tenant, ‘you have now broken your contract to keep them in repair;’ and if they were out of repair at the end of the tenancy he is entitled to say, ‘you have broken your contract to deliver them up in repair.’ I am of opinion that under a contract to keep the premises in tenantable repair and leave them in tenantable repair, the obligation of the tenant, if the premises are not in tenantable repair when the tenancy begins, is to put them into, keep them in, and deliver them up in tenantable repair.
[15](1890) 25 QBD 42, 50.
I also agree that the term ‘good repair’ means ‘tenantable repair’, or ‘reasonably fit and suitable for occupation’,[16] and that while what amounts to ‘good repair’ may be referrable to the age and character of the relevant premises,[17] it cannot ordinarily be qualified by the state of repair at the commencement of the tenancy, regardless of the state of repair. Again, the obligation to maintain rental premises in good repair imports an obligation to put them in good repair in the first place. Further, the obligation of a landlord cannot be diluted by charging a low rent.
[16]Proudfoot v Hart (1890) 25 QBD 42, 51. See also Anstruther-Gough-Calthorpe v McOscar [1924] 1 KB 716, 734, where Atkin LJ refers to ‘repair’ as ‘the idea of making good damage so as to leave the subject so far as possible as though it had not been damaged’.
[17]Ibid.
I accept that the proposition that a landlord’s obligation under s 68 may be qualified by either the condition of the premises at the commencement of the tenancy, or the level of rent charged, is inconsistent with the duty imposed at common law to take reasonable care to put and keep rental premises in a safe state of repair. As noted by senior counsel for the tenant, it would be no answer to a claim that a landlord had breached their common law duty to maintain the premises in a safe condition to say that the premises had been unsafe at the commencement of the tenancy.
Further, I agree that the question of whether the putting of premises in good repair amounts to an ‘upgrade’ of the premises is not relevant to the question of whether the premises are being maintained in good repair: in many instances it will be inevitable that effecting repairs will ‘upgrade’ the standard of the premises, for example, by replacing old floor coverings with new floor coverings. In Australian Mutual Provident Society v 400 St Kilda Road Pty Ltd,[18] McGarvie J approved the following statement of Denning LJ in Morcom v Campbell Johnson[19] concerning the distinction between improvements and repair:
If it is only replacement of something that is already there, which has become dilapidated or worn out, then, albeit that it is a replacement by its modern equivalent, it comes within the category of repairs and not that of improvements.
[18][1990] VR 646, 665.
[19][1956] 1 QB 106, 115.
I also agree with the submissions advanced on behalf of the tenant that, properly construed, the RTA does not allow the parties to a residential tenancies agreement to ‘contract out’ of their rights and obligations under the RTA. This proposition is evident from the terms of s 1 of the RTA, which states that one of the main purposes of the RTA is to define the rights and duties of landlords and tenants of rented premises, and s 27(1) of the RTA, which invalidates any term of a tenancy agreement which purports to exclude, restrict or modify the application of any or all of the terms of the RTA to a tenancy agreement, or the exercise of a right under the RTA. Such provisions sit uncomfortably with the proposition that a tenant can agree, either expressly or by conduct, to absolve a landlord of their duties under the RTA, especially a significant ‘duty’ provision such as s 68. It might well be that a tenant’s failure to complain, or continued occupation of the premises, might be relevant to the amount of compensation payable, and it might also be that a landlord might fulfil its obligations by reaching an agreement with the tenant to carry out repair works. However, such an agreement cannot absolve a landlord of its duty, or modify the content of that duty. In any event, the lease between the landlord and the tenant, which was a standard form lease, included a term that ‘The Landlord shall make sure that the premises are in good repair’, and another term that ‘Both parties to the Agreement shall comply with the provisions of the Residential Tenancies Act 1997 as they apply to each party’.
It is apparent from the remarks of the Tribunal Member during the course of the hearing that he considered the conduct of the tenant in failing to issue a breach notice, and remaining in the premises as relevant to the question of whether the landlord had breached his obligations under s 68 of the RTA, as shown by the following extract of the transcript:
MEMBER:So if the tenant objected so much why did she renew the lease after six months?
MS GARLAND: Ms Shields - - -
MS SHIELDS: I didn’t renew the lease.
MEMBER:There is an obligation if someone is seeking compensation - - -
MS GARLAND: Yes, I (indistinct).
MEMBER:- - - they have to take all reasonable steps – are you listening to me? They have to take all reasonable steps to minimise their loss. Now if after six months you find the place is unsatisfactory, being consistent with your desire to minimise your loss you might say, ‘Well, we’ll leave, thanks very much, and find somewhere else to go.’ It’s not an option to say, ‘Well, we’ll stay on here as long as we can and we’ll see if we can get some compensation out of the landlord for a long period if we can.’
The tenant’s response to that query was to the effect that she had mental health issues, and she struggled to find alternative accommodation that she could afford, despite extensive searches.
Accordingly, to the extent that the Tribunal Member’s findings reflect a view that a landlord cannot be in breach of its obligations under s 68 of the RTA if the tenant remains in occupation of the premises, for whatever reason, the Tribunal Member was in error.
I accept that my preferred construction of the obligations of a landlord under s 68 of the RTA imposes some restriction on the rights of landlords and tenants to freely enter into tenancy agreements upon terms which might be suitable to them, which was alluded to in the letters produced to the Court by the landlord. However, the framework and provisions of the RTA make it clear that the legislature intended to impose substantial limits to the principles of freedom of contract by the regulation of residential tenancies. Section 1(a) of the RTA provides that:
The main purposes of this Act are –
(a)to define the rights and duties of landlords and tenants of rental premises.
Section 27(1) of the RTA also provides that:
A term of a tenancy agreement is invalid if it purports to exclude, restrict or modify or purports to have the effect of excluding, restricting or modifying –
(a)the application of that tenancy agreement to any or all of the provisions of this Act; or
(b)the exercise of a right conferred by this Act.
Other parts of the RTA which are not strictly relevant to the current appeal, but illustrate the extent to which the legislature seeks to limit the operation of the principles of freedom of contract in the residential tenancies field include the requirement that written tenancy agreements be in standard form (s 26), the ability of a tenant to apply to VCAT to seek relief from harsh or unconscionable terms (s 28), or to complain about excessive rent (ss 45, 46), the prohibition against discrimination against tenants with children (s 30), and strict notice provisions regarding rent increases and the termination of tenancy agreements (s 44, Part 6).
I am conscious that s 68 of the RTA, properly construed, may well have the effect of limiting the availability of very low cost housing in the residential tenancies market, by preventing owners of properties in poor repair from renting out their properties at low rent, whether for commercial benefit, reasons of convenience, or, as was said to be the case here, on compassionate grounds. However, that is a policy choice of the legislature, and such considerations should not influence the proper construction of the terms of s 68 of the RTA, or its application and enforcement by VCAT and this Court.
Accordingly, grounds 1 and 3 of the grounds of appeal are made out, and the proceeding should be remitted to VCAT for determination by a differently constituted tribunal.
Grounds 4 and 5
Grounds 4 and 5 of the Notice of Appeal are particular to this dispute. They do not raise any issue of principle. Indeed, given my findings that it is not open to the parties to a residential tenancy agreement to ‘contract out’ of their rights and duties under the RTA, the attack upon the factual findings of the Tribunal Member in relation to whether such an agreement was made, and whether the Tribunal Member should have given notice to the tenant that he intended to make such a finding are no longer of any great relevance. However, I will deal with the parties’ submissions in relation to these grounds briefly.
In the matter of Defteros v Prushka Fast Debt Recovery Pty Ltd,[20] I recently had cause to consider a ground of appeal to the effect that there was ‘no evidence’ before a magistrate upon which her factual finding could be based, and summarised the task before the Court on appeal, as follows:
[20][2016] VSC 508 [26]-[29].
The ‘no evidence’ ground is a well-known ground of appeal on a question of law. It is established and uncontroversial law that:
a tribunal that decides a question of fact when there is ‘no evidence’ in support of the finding makes an error of law. What amounts to material that could support a factual finding is ultimately a question for judicial determination.[21]
[21]Kosta v HIH Insurance Services Pty Ltd (2010) 241 CLR 390, 418.
However, where there is some evidence to support a finding, it has traditionally been extremely difficult to impugn a primary decision maker’s factual finding. In Azzopardi v Tasman UEB Industries Ltd,[22] Glass JA stated that factual findings of the character described below do not constitute errors of law:
[a] finding is perverse, that it is contrary to the overwhelming weight of the evidence, that it ignores the probative force of the evidence which is all one way or that no reasonable person could have made it.
The ‘Azzopardi principle’ has been subject to some judicial criticism, not the least by Kirby P, as he then was, who gave the dissenting judgment in that case, asserting that a perverse finding of fact should amount to an error of law.[23] The strict approach of the Azzopardi principle may have been softened by the High Court in Re Minister for Immigration and Multicultural Affairs: Ex parte Applicant S20/2002[24] which suggested that an administrative decision could be subject to judicial review on the basis that it was ‘irrational, illogical and not based upon findings or inferences of fact supported by logical grounds’.
However, while the limits on the review of a decision maker’s findings of fact may not be so strict as provided for by the Azzopardi principle, as can be seen from the above discussion, a party who seeks to overturn a decision on a ‘no evidence’ ground has a high hurdle to jump.
[22](1985) 4 NSWLR 139, 155-156 (‘Azzopardi’).
[23]Ibid, 151.
[24](2003) 198 ALR 59 [34], [37].
However, as noted in the written submissions filed and served in support of the application for leave to appeal, in S v Crimes Compensation Tribunal,[25] the Court of Appeal held that whether a tribunal arrived at a conclusion that was not open to it on the evidence is a question of law. The test as to whether a tribunal makes a finding that was not open to it on the evidence is certainly less stringent than that provided for by the New South Wales Court of Appeal in Azzopardi.
[25][1998] 1 VR 83, 90.
In his reasons, the Tribunal Member noted that ‘no evidence was available as to what Mr Boyce agreed to’, but drew an inference from the notation on the condition report, and the failure of the tenant to issue a breach of duty notice, that the tenant, or at least Mr Boyce, had come to some agreement absolving the landlord from undertaking the works required to address the defects raised in the condition report. The relevant notation is as follows:
House in poor state in need of minor + major repairs but nothing that can’t be fixed by Shane Boyce if owner allows. As due to these issues in our report we find the house very unsafe under the health + safety act.
There was no other evidence before the Tribunal Member as to whether the ‘owner allowed’ Mr Boyce to effect any repairs, or if he did so, save that the tenant gave evidence that Mr Boyce moved a window from one room to another after seeking the permission of the real estate agent to do so.
Alternatively, senior counsel for the defendant submitted that the Tribunal Member failed to afford procedural fairness in failing to put this finding to the tenant in order to give the tenant the opportunity to address him on the matter, or to question the landlord or his agent about the existence or content of any such agreement.
Senior counsel for the tenant referred to the decision of the Full Court of the Federal Court in Commissioner of the Australian Capital Territory Revenue v Alphaone Pty Ltd,[26] where the Court summarised the relevant principles as follows:
Where the exercise of a statutory power attracts the requirement for procedural fairness, a person likely to be affected by the decision is entitled to put information and submissions to the decision-maker in support of an outcome that supports his or her interests. That entitlement extends to the right to rebut or qualify by further information, and comment by way of submission, upon adverse material from other sources which is put before the decision‑maker. It also extends to require the decision-maker to identify to the person affected any issue critical to the decision which is not apparent from its nature or the terms of the statute under which it is made. …
[26](1994) 49 FCR 576, [30].
In some respects, addressing these grounds of appeal is a somewhat academic exercise, given my findings that it is not permissible for a landlord and tenant to ‘contract out’ from their obligations and obligations under the RTA.
However, while arguably there was some (albeit scant) evidence of an agreement between the tenant and the landlord to the effect that Mr Boyce would effect the repairs, that finding, in circumstances where the Tribunal Member himself had said there was ‘no evidence’ of what was agreed to, strikes me as illogical in the circumstances.
As for the procedural fairness issue, one must be cautious of being too critical of a Tribunal Member in these circumstances, where no party was represented, and where the issues in the proceeding had not been defined by pleadings. However, it seems to me that perhaps while it might not have been strictly necessary to formally put the existence of the agreement to the tenant, in the circumstances, given the inquisitorial manner in which the Tribunal Member conducted the proceeding (and this in no way a criticism given the nature of the proceeding and the parties), it seems to me that it was incumbent upon the Tribunal Member, given his subsequent reference in the reasons to the notation in the condition report, and that notation being consistent with the existence of an agreement, to question the landlord and/or the real estate agent about what, if anything, was agreed at the commencement of the tenancy, which in turn would have alerted the tenant to the need to put her own version of events in relation to that issue. These grounds of appeal are made out.
Ground 2
Once again, strictly speaking, it is not necessary for me to deal with this ground of appeal, but will do so briefly. Senior counsel for the tenant submitted that in failing to address each of the repair issues identified by the tenant in her application individually, the Tribunal Member erred in the manner in which he approached the tenant’s application, or if he did, the reasons he provided did not adequately explain his decisions in relation to each of the tenant’s claims.
The written submissions filed on behalf of the tenant dealt with this ground of appeal as follows (citations omitted):
The appellant’s written application to the Tribunal included claims that related to repair issues that were in existence when the appellant first took possession of the rented premises and repair issues that arose later in the tenancy. For the repair issues that were in existence at the outset, the Tribunal prevented the appellant from giving evidence in relation to them at the hearing, and in its decision failed to give consideration to whether they represented breaches of s 68(1) (due to its flawed construction of s 68(1)). In relation to the repair issues that arose after this period, the Tribunal failed to give proper consideration to them. Instead, it took a global approach, finding that the fact that the respondent’s agent had produced receipts totally $10,498 in relation to work done on the rented premises meant that the respondent had fulfilled his maintenance obligations under s 68(1).
The appellant’s allegations with regard to the Respondent’s breaches of s 68(1) were fundamental to its application before the Tribunal and it was accordingly incumbent on the Tribunal to make relevant factual findings in relation to them. By
· not examining the appellant’s claims at all (in relation to the repair issues in existence from the outset); or
· not examining them individually (in relation to the repair issues that arose subsequently); and
· either preventing or restricting the appellant from giving specific evidence as to the repair issues complained of
the Tribunal failed to perform its task of considering the appellant’s claims for compensation.
A Tribunal is not entitled to fail to deal with claims at all or to deal with them in a global or summary way. By failing to address, either properly or at all, the central questions raised by the appellant’s application, the Tribunal failed to apply itself to, and address, the correct legal question which the law prescribes and thereby constructively failed to exercise its jurisdiction.
I would be hesitant to allow the appeal on this ground alone. The submission made by the landlord to the effect that the Tribunal Member afforded the tenant an opportunity to address each of the issues which arose after the commencement of the tenancy, but that the tenant was unable to give satisfactory evidence in relation to her specific claims, has some merit.
Further, given the nature of the proceeding, I would be loath to be unduly prescriptive regarding the procedure to be followed by tribunal members in a specialist, high volume list, where no doubt many, if not most of the parties are not legally represented. One would hesitate to mandate that a residential tenancies dispute be conducted in the same manner as a building case. In some cases, it might be necessary for a tribunal member to methodically make a finding on a defect by defect basis, in other cases, it may simply not be warranted. In the current case, the Tribunal Member had before him documents which enumerated the repair issues, and documents which enumerated the repairs effected by the landlord. It is apparent from the transcript of the hearing and the reasons that he accepted the real estate agent’s evidence that he arranged for any necessary repairs, insofar as they related to repair issues that emerged during the course of the tenancy.
In coming to this view, I am conscious of the provisions of both the RTA and the VCAT Act. Section 1(d) of the RTA provides that one of the purposes of the RTA is ‘to provide for the inexpensive and quick resolution of disputes under this Act.’ Further, s 98(1) of the VCAT Act provides that:
The Tribunal –
(a) is bound by the rules of natural justice;
(b)is not bound by the rules of evidence or any practices or procedures applicable to courts of record, except to the extent that it adopts those rules, practices or procedures;
(c)may inform itself on any matter as it sees fit;
(d)must conduct each proceeding with as little formality and technicality, and determine each proceeding with as much speed, as the requirements of this Act and the enabling enactment and a proper consideration of the matters before it permit.
Given the stated purpose of the RTA, the nature of the parties and disputes likely to come before VCAT under the RTA, it seems to me that it would be expected that proceedings concerning disputes under the RTA are likely to be heard in a manner which would be at the less formal end of the spectrum.
In support of the tenant’s submissions that the Tribunal Member erred in law in adopting a global approach to the repair issues identified in the tenant’s application, I was referred to the decision of Mortimer J in Mulligan v National Disability Insurance Agency (‘Mulligan’)[27] which was a review of the Administrative Appeals Tribunal’s decision rejecting an application by the applicant to be a participant in the National Disability Insurance Scheme because he failed to meet the eligibility criteria laid down by the relevant legislation. Her Honour held that the tribunal, in circumstances where the applicant would have been eligible had he met one of a list of criteria set out in a particular provision, had erred by dealing globally with the application, rather than addressing the applicant’s evidence and submissions in relation to each of the criteria in question. Her Honour stated:
… By failing to respond to the detailed submissions made in relation to the individual aspects of s 24(1)(c) the tribunal had not reviewed the NDIA decision, and in particular had not reviewed whether Mr Mulligan could meet any of the factors set out in para (c). Rather, the tribunal made a global finding, which subsumed and replaced the detailed consideration of each factor the statute required.
This submission should be accepted, characterising the tribunal’s error as a failure to perform the task of review, especially reviewing whether Mr Mulligan met any of the factors set out in s 24(1)(c) is, in my opinion, the most appropriate way to identify the error of law made by the tribunal. …
[27](2015) 146 ALD 418 [57]-[61].
However, in my view, in reaching her conclusion that the tribunal had not performed the task imposed upon it by the relevant statute, I do not consider that her Honour was imposing an inflexible rule with respect to the manner in which a tribunal approaches a proceeding involving multiple claims, multiple issues, or, as in the case before her, a list of statutory criteria against which a claim must be evaluated. That much is clear from her reference to the decision of Flick J in Australian Postal Corporation v Hughes[28] where his Honour stated that:
There is considered to be no necessity for the tribunal to expressly identify any particular submission being advanced for resolution, or to identify it in the same or similar terms to that being advanced by a party, and to then expressly address and resolve that submission. The manner in which the tribunal resolves competing submissions, and the manner in which it expresses those submissions, is a matter for it to determine. That which is required, however, is for it to be readily apparent that a submission of ‘substance’ or one ‘worth of consideration’ has in fact been addressed and resolved. The tribunal discharged that task in the case at hand.
[28](2009) 111 ALD 579 [65].
Her Honour then went on to state:
However, where a decision-maker deals globally, or in a summary way, with detailed submissions, especially where the scheme makes detailed provision for assessment, it may be more likely the decision-maker will stray from the task in the statute. That in my opinion, and with great respect to the tribunal, is what occurred here. By not examining individually, and by reference to the specific evidence and material before it, whether Mr Mulligan’s circumstances satisfied any of the four categories in s 24(1)(c) he relied upon, the tribunal did not perform its task on review. That task required, in my opinion, a more detailed and particular consideration of each activity in s 24(1)(c) than the tribunal embarked upon. That is because the evidence and material before the tribunal did differ in respect of each category, and each category in s 24(1)(c) has a different focus. Parliament had made it clear an applicant need only satisfy one of the six categories est out in s 24(1)(c). Global consideration is likely to obscure particular aspects of the evidence and material before the tribunal, as in my opinion it did in this case.
Accordingly, while no doubt the decision in Mulligan will influence the manner in which the Administrative Appeals Tribunal approaches the determination of an applicant’s eligibility to participate in the NDIS, and more generally, the obligations of a decision maker engaging in an evaluative exercise against prescribed statutory criteria, Mulligan cannot be taken to prescribe the manner in which a tribunal approaches the determination of any proceeding before it involving multiple claims, particularly having regard to s 1 of the RTA and s 98(1) of the VCAT Act. This ground of appeal fails.
I will hear further from the parties on the form of orders to be made and the question of costs.
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