Tabak v Diamond & Anor (Appeal)
[2024] ACAT 68
•29 August 2024
ACT CIVIL & ADMINISTRATIVE TRIBUNAL
TABAK v DIAMOND & ANOR (Appeal) [2024] ACAT 68
AA 13/2024 (RT 138/2024)
Catchwords: APPEAL – residential tenancies – appeal against termination and possession order – termination when premises uninhabitable – defect in notice of termination – particulars required in notice of termination – correction of defects – authorization of representative – whether termination retaliatory – no error established
Legislation cited: ACT Civil and Administrative Tribunal Act 2008 s 7
Powers of Attorney Act 2006 s 96
Residential Tenancies Act 1997 (R75) s 59
Residential Tenancies Act 1997 (R77) ss 38, 47, 57, 59, 83, 85, 86, 87, 133, Schedule 1 standard terms 83, 86, Dictionary
Residential Tenancies Legislation Amendment Act 2023
Subordinate
Legislation cited: ACT Civil and Administrative Tribunal Procedures Rules 2020 r 41
Cases cited:Adams v Lambert [2006] HCA 10
Allesch v Maunz [2000] HCA 40
Campbell v Blackshaw & Evans [2017] ACAT 64Haritos v Commissioner of Taxation [2015] FCAFC 92
He v Qin & Ors [2021] ACAT 129
Ikechukwu v Duong [2018] ACAT 97
Mohammadian v Samani & Anor [2021] ACAT 125NAJT v Minister for Immigration and Multicultural and Indigenous Affairs [2005] FCAFC 134
Nichols v Amers Pty LtdACN 112 055 366 (No. 2) [2020] ACAT 79
Water Board v Moustakas [1988] HCA 12
List of
Texts/Papers cited: Beazley et al Appeals and Appellate Courts in Australia and New Zealand (2021)
Tribunal:Presidential Member Robinson
Senior Member Hassall
Date of Orders: 29 August 2024
Date of Reasons for Decision: 29 August 2024
Date of Publication: 9 September 2024
AUSTRALIAN CAPITAL TERRITORY )
CIVIL & ADMINISTRATIVE TRIBUNAL ) AA 13/2024
BETWEEN:
ROSS TABAK
Appellant/Tenant
AND:
BRIAN DIAMOND
First Respondent/Lessor
MARILYN MANANQUIL
Second Respondent/Lessor
APPEAL TRIBUNAL: Presidential Member Robinson
Senior Member Hassall
DATE:29 August 2024
ORDER
The Tribunal orders that:
The appeal is dismissed.
………………………………..
Presidential Member H Robinson
For and on behalf of the Appeal Tribunal
REASONS FOR DECISION
This is an application for appeal against a decision of the Tribunal made on 28 February 2024. By way of that decision, the Tribunal made a termination and possession order under section 85(1)(a) of the Residential Tenancies Act 1997 (the RTA) terminating the tenants’ residential tenancy agreement with the lessors.
Background and timeline
While there are some contested facts, the below represents what we understand to be relevant common ground.
Mr Ross Tabak (the appellant/tenant) and Ms Janit Feangfu entered into a residential tenancy agreement (the agreement) on 10 February 2023 with the lessors, Mr Brian Diamond and Ms Marilyn Mananquil (the respondents/lessors). The lease was for a fixed term of 24 months, from 16 February 2023 to 25 February 2025.
On 11 December 2023, Mr Tabak contacted the lessors’ real estate agent, Mr Harry Enright of LJ Hooker (the agent) and advised of flooding in the loungeroom of the property. The next day, 12 December 2023, a plumber attended the property and found that the front downpipe was blocked. The plumber cleared the pipe. Repair work was also undertaken by another contractor on both the skirting boards and the gutters.
On 8 January 2024, Mr Tabak again contacted Mr Enright and advised of further damage. Mr Enright attended the property and noted significant flooding. Mr Tabak also advised of a potentially faulty hot water system. Mr Enright arranged for a plumber to attend the property and clear a blocked storm water line. Despite significant damage, including to the carpets, Mr Tabak declined the offer of a cleaner, having “purchased a wet/dry vac and begun to clean up.”[1]
[1] Email dated 8 January 2024 from Mr Tabak to Mr Enright
On 9 January 2024, Mr Tabak advised Mr Enright of further issues, including a smell emanating from the carpet. Mr Tabak further advised that he had removed the carpet himself, as well as taken other steps to remediate the damage. Some further correspondence ensued about removing and replacing cabinets.
The Appeal Tribunal notes for context, that the tone of Mr Tabak’s correspondence from this point becomes increasing elevated. It is understandable that he was frustrated by the circumstances, but the intemperate language was unhelpful, to say the least.
Once the carpet was removed, it immediately became apparent that the property had a mould issue. Mr Tabak and Ms Feangfu, the tenants, took photographs that were before the Original Tribunal. Suffice to say, to the inexpert eye, there was a lot of mould, as well as other water damage. The tenants moved out of the property on 11 January 2024, although they left their personal possession at the property.
The agent arranged for a company, Steamatic Canberra (Steamatic) to attend and undertake an inspection for damage and mould on 12 January 2024. The technician appeared to have had difficulty gaining access, with Mr Tabak raising concerns about negative Google reviews and the technician refusing to show “ID” as requested by Mr Tabak. Nonetheless, Steamatic prepared a scope of works and sought permission from the lessors to undertake the work.
On 15 January, a structural engineer, Mr Gerin Hingee, attended the property with the agents. Immediately after attending, Mr Hingee wrote a brief email setting out work that would need to be done to identify the source of the leak. On 18 January 2024, he provided a more thorough report to the agents (the Hingee Report) that stated, in part:
On inspection it was noted that the carpet and wall linings had been removed to expose dampness, water ingress and mould in the living room.
Dampness could be caused by leaking water, damaged stormwater or sewer pipes, or ground seepage from behind the house. The water is building up behind, and seeping through, the retaining wall at the change in floor level. The retaining wall is probably not waterproofed or protected by a subsoil drain.Because of the extent of the further investigations, the likelihood of time consuming major remedial works, and the possible health issues, the property is not deemed uninhabitable.
Mr Hingee went on to set out the work that needed to be done to repair the site.
On 19 January 2024, the lessors served the tenants with a “notice to vacate”, advising them to vacate on or before 30 January 2024 (the first notice to vacate). The notice stated, in part:
TAKE NOTICE that you are now required to vacate the said premises on or before the 30/01/2024 which is seven (7) days notice in accordance with the Standard Residential Tenancy Terms in the schedule of the Residential Tenancy Act 1997.
The tenancy shall end on the date you vacate the premises.
THE GROUNDS for giving you this notice are:
Prescribed Terms
Termination where premises are not fit for habitation
86(1) The lessor or the tenant may, by written notice, terminate the tenancy on a date specified in the notice on the following grounds:
(a) the premises are not fit for habitation;
…
87(1) In either case the lessor must give not less than 1 week’s notice of termination of the tenancy, and the rent abates from the date that the premises are uninhabitable.
(2) The tenant may give 2 days notice of termination of the tenancy.
…
The notice was served by registered post.
On 30 January 2024, Mr Tabak sent an email to Mr Enright stating that he “did not recognise” the first notice to vacate and set out a list of reasons why. These reasons are consistent with those raised by the tenants in this application, including the lack of “evidence” as to why the lessors considered the house uninhabitable. Mr Tabak noted that the Hingee report had not been provided to him. He also outlined his and his co-tenant’s anticipated claim for compensation and noted their names were incorrect.
The lessors, “out of an abundance of caution”, served a second notice on 31 January 2024, seeking possession of the property on 13 February 2024 (the second notice to vacate). The notice was also served by registered post.
The tenants remained residing in alternative living arrangements during this time, and their personal property remained on the premises.
The original proceedings
On 8 February 2024, the lessors lodged an application with the ACAT for a termination and possession order on the ground that the property was uninhabitable (the original proceedings) with Mr Tabak and Ms Feangfu as the initial respondents. The application included the first and second notices to vacate and a copy of reports from Mr Hingee and Steamatic, as well as the photographs. The hearing was listed for 28 February 2024.
On 16 February 2024, the tenants wrote to the tribunal and requested an adjournment of the hearing on the basis that they needed time to prepare for the hearing. The registrar considered the request and, by way of email on 19 February 2024, declined to grant the adjournment.
On 20 February 2024, the tenants responded to the tribunal and advised, in part, that they were unable to prepare because of the situation in which they were living. This, we understand, was some form of serviced accommodation. There was no suggestion that the tenants were homeless.
On 27 February 2024, the lessors filed submissions. These were emailed to the tenants.
Also on 27 February 2024, Mr Tabak wrote to the tribunal and again requested an adjournment. In that email, the tenants set out the basis upon which they said the application should be dismissed. This could, broadly, be considered a written submission and we have taken it as such (tenants’ email submission). The tenants’ email submission reads, in summary:
(a)They acknowledged the deadlines for filing of documents and conceded they would not meet them;
(b)They had “sought what third party legal advice we can within the time constraints and found it to be unacceptable”;
(c)They were unable to appear at the hearing or appoint a representative and “trust this tribunal’s judgment on the matter absent our appearance”;
(d)They “maintain that the case set forth by the lessors” is “deficient in its submission and outside the jurisdiction of this Tribunal”, and set out the following reasons:
(i) Firstly, “while we are willing to acknowledge and waive service of the initial claims”, they state that all the documents “contain procedural deficiencies even before considering the content”.
(ii) The applications did not require a signature and were left unattended on the doorstep – they included photographs of this.
(iii) The lessors’ representatives were required to obtain a power of attorney and attach evidence and did not appear to have done so.
(iv) The matter/application in dispute “as presented by the claimants” is outside the jurisdiction of the tribunal:
evidenced by the tenants’ estimation of when the property became uninhabitable (vs. uninhabited) and the abated rent thereby owed. This alone puts the amount well beyond the jurisdictional limit for this venue, but even that number is a miniscule fraction of the total accounting (with reimbursable expenses and damages therein continuing to accrue).
(v) The tenants were willing to continue to negotiate with the lessors outside the tribunal.
(e)The email submission concluded with the words, “[w]e trust that this Tribunal in its good judgment will dismiss the lessors’ claims in their entirety without further conditions or orders.”
(f)The aforementioned “procedural deficiencies” were not particularised, but the tenants attached to their correspondence a bundle of .JPG documents and emails, containing correspondence between Mr Tabak and the agents, including a document that, by its title of “expenses owed to date” appears to be a claim for expenses.
The tenants did not attend the hearing on 28 February 2024. The Original Tribunal telephoned Mr Tabak and did not receive a response. The Original Tribunal then called the other tenant, Ms Feangfu, who advised that Mr Tabak “is taking care of that.” The member advised Ms Feangfu that Mr Tabak had not attended and asked that she ask him to call the tribunal. Mr Tabak did not call back. The Original Tribunal proceeded in his absence.
The Original Tribunal had regard to the material before it and made a termination and possession order (the T&P Order) terminating the agreement as at 5:00pm on 28 February 2024. Pursuant to order 4 of the T&P Order, the tenants were ordered to vacate the premises on or before 5:00pm on 28 February 2024.
The Original Tribunal’s reasons were given orally:
[…] based on the structural engineer report which had been provided to the tribunal with your application is evidence that the premises is not fit for habitation. Secondly, I’m satisfied that a notice was properly given under section 86(1)(a) of the Standard 5 Terms, notifying the tenants that the premises was not fit for habitation, and secondly, giving the tenants at least one week’s notice to vacate in accordance with section 87(1) of the standard terms.
And so I’m satisfied for the purpose of section 47(1)(a) of the Residential Tenancies Act that a ground for termination exists, and as I mentioned, that’s under section 86 and 87(a) of the Standard Residential Tenancy terms, that the termination notice has been served in accordance with section 47(1)(b), that in accordance with section 47(1)(c) that the tenant has not properly vacated the premises notwithstanding the tenants are living elsewhere. Their belongings are still at the premises and so they haven’t vacated. And so that means the requirements of section 47(1) have been met in relation to the termination.
…
So I’m satisfied that a termination order can be made today with effect – so for the lease to be terminated at 5.00 pm today.
The Original Tribunal heard submissions from the agents, and having regard to potential hardship to the tenants, suspended the operation of the order for seven days so that the tenants had time to remove their belongings.
On 28 February 2024, the tenants sent an email to the tribunal “apologising” for not attending the hearing. They did not make an application to set the decision aside at that time.
The tenants did not vacate the premises as required by the T&P Order. Mr Tabak maintained that the notice to vacate, and hence the order, was invalid.
On 6 March 2024, the former tenants filed an application for interim or other orders, seeking an order that orders 1-7 of the T&P Order made on 28 February 2024 be vacated. On 13 March 2024, the tenants’ application for interim or other orders was dismissed by a presidential member of this tribunal. The T&P Order remained operative. In reasons provided to the tenants, the Presidential Member stated that the T&P Order was valid unless set aside. The tenants nonetheless declined to vacate the premises.
On 15 March 2024, a Deputy Legal Registrar of the tribunal issued a warrant, authorising officers of the Australian Federal Police (AFP) to take appropriate action to evict the former tenants within 21 days of the issue of the warrant; that is by Friday, 5 April 2024.
On 20 March 2024, Mr Tabak filed another application for interim or other orders asking the tribunal to “overturn” the T&P Order for various reasons. On 20 March 2024, the Tribunal heard and dismissed the further application for interim or other orders.
On 22 March 2024, Mr Tabak filed an application for appeal against the T&P Order. Ms Feangfu was not a party in the appeal matter. The appeal was listed for directions on 4 April 2024.
On 1 April 2024, Easter Monday, Mr Tabak, now the appellant, filed an application for interim or other orders, seeking an order that the warrant for eviction, scheduled to be executed on 2 April 2024 at 10:00am, be stayed pending the outcome of their appeal. Another, differently constituted Tribunal, declined to grant the stay.
On 3 April 2024, the appellant and the respondents both lodged further interim applications, largely to do with access to the premises for Mr Tabak and Ms Feangfu to collect their property without the lessors’ supervision. These were listed for hearing on 4 April 2024. On that date, an appeal Tribunal dismissed both applications and made directions to prepare the matter for hearing of the appeal. The Tribunal brokered an arrangement to allow the former tenants to retrieve certain items of their property without the supervision of the lessors.
The appeal was listed for hearing on 19 April 2024.
The appellant filed an amended application for appeal on 10 April 2024, and a further application for interim orders on 15 April 2024. The lessors filed submissions in response on 15 April 2024, and the appellant filed his reply on 17 April 2024.
At the hearing on 19 April 2024, both parties were in attendance, with the lessors represented by their agents, Mr Enright and Ms Claudia Pipitone, who appeared in person. Mr Tabak appeared by video link. The parties made brief submissions but otherwise relied upon the documents they had filed.
The grounds of appeal
The grounds of appeal, as identified at the hearing, and with some editing for clarity, are that:
(a)The Original Tribunal erred in law in finding that the notice to vacate was valid, and that the Original Tribunal – and hence this Appeal Tribunal – do not have the power to correct that notice, and as such the lease is still operative.
(b)The Original Tribunal erred in proceeding in circumstances where the lessors had not properly authorised their representative.
(c)The Original Tribunal breached procedural fairness during the hearing, including by proceeding in the tenants’ absence, calling Mr Tabak and Ms Feangfu on the telephone, and in considering submissions filed the day before the hearing.
We note that, as the tenants did not attend the hearing, none of these concerns were put to the Original Tribunal at the hearing, although the second ground (that of the Power of Attorney) was raised in the tenants’ email submission, which was on the file that was before the Original Tribunal.
What is not in contest
Before turning to the validity of the notice, and the hearing, it is useful to start by setting out what is not in contest in this matter:
(a)it is not in contest that the property, at the time the T&P Order was made, and at the time of both the original hearing and the appeal, was uninhabitable;
(b)it is not in contest the tenants had moved out of the premises and have not lived there since 11 January 2024 – that is, at the time of making the appeal they had secured another place to live and were living there;
(c)it is not in contest that the rent abated from at least the date the premises was declared uninhabitable – although, we note that Mr Tabak argues the property was uninhabitable from before that date; and
(d)it is not in contest that the tenants left their personal belongings at the property because they did not wish to vacate, and that the lessors were aware of this.
The role of the Tribunal on appeal
In He v Qin & Ors [2021] ACAT 129, a differently constituted appeal Tribunal observed that:
41. Pursuant to section 79(3) of the ACT Civil and Administrative Tribunal Act 2008 (ACAT Act), a party to an original application may appeal to the tribunal on a question of fact or law. Pursuant to section 82(1), an appeal may be dealt with as a new application, or as a review of the original decision, as the tribunal considers appropriate. The former is what lawyers refer to as a ‘hearing de novo’ and the latter as a ‘rehearing’.
42. By orders made on 8 February 2021, the appeal is to proceed as a review of the original decision unless the appeal tribunal orders otherwise. The appeal tribunal did not order otherwise. For the reasons set out below at [56]-[65], the application was dealt with as a rehearing on the evidence before the original tribunal.
43. In V v Elringtons Pty Ltd, the appeal tribunal’s role in a rehearing was summarised as follows:
In Excel Intelligent Pty Ltd v Thompson, the Tribunal considered the judicial authorities discussing the role of an appeal court or tribunal. It is not necessary to repeat the full discussion in that decision. However, it is relevant to note the following propositions drawn from judgments about the nature of a rehearing:
(a)An appeal court (or an appeal tribunal) must determine whether the decision appealed against is wrong because the court at first instance (or an original tribunal) fell into an error of law, made a finding of fact that is clearly wrong or exercised a discretion on a wrong principle or in a way that is clearly wrong.
(b)Ordinarily, if there has been no further evidence admitted or no relevant change in law, a court in entertaining an appeal by way of rehearing (or an appeal tribunal) can exercise its appellate powers only if satisfied that there was an error on the part of the court below (or an original tribunal).
(c)The appellate court (or an appeal tribunal) will give proper allowance to the advantage of the court of first instance (or an original tribunal) who saw and heard the witnesses, so that, ordinarily, facts found based on the assessment of witnesses will not lightly be overturned.
(d)The appellate court (or an appeal tribunal) is obliged to conduct a real review of the trial and the reasons of the court of first instance (or an original tribunal).
(e)In an appeal by way of rehearing, once error below has been found (after making proper allowance for the advantages of the trial judge or original tribunal), the appellate court (or appeal tribunal) can substitute its own decision based on the facts and the law as they now stand.
44. In short, an appellant must show that the original tribunal committed an error of fact or law that was material to the result.
45. An appellant must do more than contend that the decision of the original tribunal was wrong and that there should be a different result. A rehearing does not give an appellant the opportunity to have a second run at the target, as if the original decision had never been made, simply because the appellant is dissatisfied with the result. The onus is on an appellant to show, specifically, where the original tribunal went wrong. Normally, that requires an appellant to point to an error of fact or an error of law in the written or oral reasons for decision of the original tribunal and to explain to the appeal tribunal how that error affected the result.
(citations omitted)
In this case, the appeal proceeded as a rehearing on the evidence before the Original Tribunal. Neither party sought to rely on fresh evidence. The questions before the Tribunal concerned questions of law, and mixed questions of fact and law. If this Tribunal is satisfied of an error of law by the Original Tribunal, it may substitute its own decision.
The difficulty for the appellant, and this Tribunal, is that his primary ground - that of the deficiency in the notice (alleged deficiency issue) - was arguably not raised before the Original Tribunal.
Identifying the issues before the Original Tribunal is not straightforward. The tribunal does not require “pleadings” of the kind found in courts and there is no requirement for a respondent to an application for a T&P Order to file a response prior to the first listing date. In this case, the tenants did file an email submission, in which they alluded to the defective notice, but it requires a thorough reading of the copious pages attached email correspondence between the parties to find it fully elucidated.
We have considered whether the lessors should have raised the potential defects in their submissions to the Tribunal, especially when the Tribunal proceeded ex parte. Were the lessors’ agents lawyers, it may well have been incumbent on them to draw the potential defects in the notice to the Tribunal’s attention. However, we are not convinced such an obligation lies upon real estate agents, particularly in circumstances where the correspondence between the parties is dense, the arguments at times are unclear, and the issue not expressly raised in the tenants’ email submission. Further, there was no error by the Original Tribunal, sitting in a busy list, in not carefully reviewing every document filed by the parties, searching for grounds to support the case of a party who was not present. If the tenants wished to make an argument to the Original Tribunal that the notice was defective, it was incumbent upon them to attend, or at the very least articulate the argument in writing beforehand. They declined to do so. The question is therefore whether it is appropriate for this Tribunal to consider that issue now, on appeal, in those circumstances.
As was stated in Beazley et al, Appeals and Appellate Court in Australia and New Zealand:[2]
Whether or not a ground of appeal that raises a fresh issue will be entertained in an appellate jurisdiction depends on the nature of the matter and the effect of allowing the matter to be raised for the first time on appeal. The underlying principle is the principal of finality; an appeal is not the occasion for the making of a second, different case.
[2] 5.56 page 130
An exception can be made where the issue is entirely a question of law, and no new evidence is required, provided there is no prejudice to the other party.[3] However, for reasons that are set out below, this is not a straightforward question in this case, as the kind of prejudice that arises from the consideration of new grounds on appeal is starkly in issue here.
The grounds of appeal – Ground 1 – The defects in and validity of the notice
[3] Beazley at [5.56] citing NAJT v Minister for Immigration 147 FCR 51 at 67-68; Water Board v Moustakas [1988] HCA 12; see also Haritos v Commissioner of Taxation [2015] FCAFC 92
The appellant’s first argument is that the notice to vacate, issued under standard term 86(1)(a) of the RTA, was defective, and accordingly the Original Tribunal erred in law in relying upon it.
The tenants say that the Original Tribunal failed to properly apply the test for a “notice to vacate”, set out in standard term 83 of the RTA (in schedule 1), which requires “the ground(s) on which the notice is issued, together with sufficient particulars to identify the circumstances giving rise to the ground(s)” to be included; and/or that the Original Tribunal erred in finding that the notice did meet that test. The tenants say that the lessors should have included the engineer’s opinion, or some summary of it, in the grounds. This is a mixed question of law (was the right test applied?) and fact (did the notice meet the requirements of the Act?).
Standard term 83 is entitled “Notice to vacate”, and provides that:
Notice to vacate by lessor
83 A notice to vacate must be in writing, in the form required by the Residential Tenancies Act, and must include the following information:
(a) the address of the premises;
(b) the ground(s) on which the notice is issued, together with sufficient particulars to identify the circumstances giving rise to the ground(s);
(c) that the lessor requires the tenant to vacate the premises by the expiry of the required notice period and that the tenancy ends on the day that the tenant vacates the premises.
Standard terms 86 and 87 deal with termination where the premises are not fit for habitation, and provide:
Termination where premises are not fit for habitation
86 (1) The lessor or the tenant may, by written notice, terminate the tenancy on a date specified in the notice on the following grounds:
(a) the premises are not fit for habitation;
(b) the premises are not available or will not be available because of Government action within a period of 4 weeks of the date that notice is given.
(2) However, a lessor or tenant must not terminate the tenancy under subclause (1) only because the lessor has failed to comply with the minimum housing standards applying to the premises.
Note A tenant may apply to the ACAT to terminate the tenancy if the lessor fails to comply with the minimum housing standards (see Residential Tenancies Act, s 46AA).
87 (1) In either case the lessor must give not less than 1 week’s notice of termination of the tenancy, and the rent abates from the date that the premises are uninhabitable.
(2) The tenant may give 2 days notice of termination of the tenancy.
(3) If neither the lessor nor the tenant give notice of termination of the tenancy, the rent abates for the period that the premises are unable to be used for habitation, but the tenancy resumes when they are able to be used again.
Before proceeding further, we note that there are two different terms at work here – a “notice to vacate” and a “notice of termination of the tenancy”. The notes to schedule 1 of the Standard Terms provide that “[a] reference in this tenancy agreement to a notice to vacate … is taken to be a reference to a termination notice under the Residential Tenancies Act.” It is not entirely clear to us that the notice issued under standard term 86 is a “notice to vacate” for the purposes of standard term 83. However, the tribunal’s power to terminate a tenancy where there is no breach of the standard residential tenancy terms is found in section 47 of the RTA, and this section makes it clear that a notice to terminate is required:
47 No breach of standard residential tenancy terms
(1) On application by a lessor, the ACAT may make a termination and possession order if satisfied that—
(a)a ground for termination exists under the standard residential tenancy terms (other than for a breach of the standard residential tenancy terms); and
(b)the lessor has served a termination notice on the tenant based on that ground; and
(c)the tenant has not vacated the premises as required by the termination notice; and
(d)if the application relates to a termination notice served by the lessor in accordance with a community housing provider termination clause, public housing termination clause, subsidised accommodation clause or temporary housing assistance termination clause—the termination is reasonable and proportionate.
…
In her oral reasons, the Original Tribunal did not expressly refer to standard term 83, but she did expressly find that the notice met the requirements of standard term 86, and section 47(1) of the RTA. In considering the oral reasons, it is useful to note the observations of President Daniel in Campbell v Blackshaw & Evans:
It is not the role of the Appeal Tribunal to pore over written or transcribed oral reasons searching for possible inadequacies but rather to consider whether, taken as a whole, the reasons disclose that the Tribunal fell into error. A Tribunal at first instance should not feel obliged to slavishly record every detail of the evidence given by every witness, or to set out fine nuances or points of distinction, in order to demonstrate to a hypothetical Appeal Tribunal or Court that due consideration and weight has been given. The primary audience for reasons remains the parties, and reasons which set out the necessary elements in a manner proportionate to the context of the matter will ordinarily be sufficient.[4]
[4] Campbell v Blackshaw & Evans [2017] ACAT 64 at [60]
The context in which these reasons were delivered was a hearing in the termination and possession list, a busy “running” list with one matter per hour. ACAT proceedings are often informal and decisions are usually given orally and focus on explaining the decision in light of the issues in contest, rather than setting out in chapter and verse the legal framework. Brief, oral reasons of this kind were a reasonable and proportionate approach in circumstances where the uncontested evidence of one party was that the property was uninhabited, and the other party had declined to attend the proceedings. We are not satisfied that a failure by the Original Tribunal to expressly refer to the requirements of standard term 83(b) should be conclusive evidence that the Original Tribunal did not turn their mind to it.
Nonetheless, it is the role of this Tribunal to do a “full review”, and the Original Tribunal’s omission in not mentioning the requirements of standard term 83(b) does leave open the possibility that the Original Tribunal may not have considered it, and hence may have made an error of law. If so, this Tribunal can substitute its own view for that of the Original Tribunal.
Turning to the notice itself, it must be observed that the notice relied upon by the lessors was a minimalist document. It contained the relevant section of the RTA under which the notice was issued, but it did not properly set out the basis on which it was issued, nor any particulars, as required by the language of standard term 83(b). It did not set out why the property was uninhabitable, and only asserted that it was.
The provision of adequate particulars is essential for a tenant to know whether the circumstances on which the lessor relies give rise to a ground for termination, and, if necessary, to enable the tenant to obtain advice as to their rights and remedies under the RTA.[5] What particulars are required will depend on the ground under which the notice is issued.[6]
[5] See Mohammadian v Samani & Anor [2021] ACAT 125 at [69]
[6] [2021] ACAT 125
We agree with the tenants that the lessors should have provided some description as to the grounds upon which they say the property was uninhabitable. Attaching the Hingee Report would have been one way; summarising the relevant paragraphs another; stating the property had significant water damage, serious mould, and required extensive renovation, perhaps a third. It is not acceptable to cite a section number of the RTA and leave it at that. We also do not understand why, despite a clear request, the lessors did not simply give the tenants a copy of the report when they first requested it. As the tenants were living in the house, and being asked to vacate it, it was reasonable that they be given the full information necessary to make a decision. This process may well have run much more smoothly if this had occurred.
Nonetheless, and despite not getting a copy of Mr Hingee’s report at the time he received the notice, Mr Tabak does not suggest that the property was, in fact, habitable. He knew very well the basis upon which the notice was issued. It is not in dispute that there was considerable mould and damp in the property. The photographs before the Tribunal, taken by the tenants, speak for themselves. Moreover, there had been discussions between the parties. The tenants had, in fact, moved out. No one has suggested the property required the kind of repairs that could be undertaken quickly or with the tenants in residence. As such, there is a sense of unreality in seeking to have the notice set aside for not setting out particulars, in circumstances where everyone concerned was aware of those particulars, and where the lawful ground for the termination – uninhabitability – was not and is not in dispute. This convergence of facts does not of itself make the notice itself compliant with standard term 83, but in considering what “sufficient particulars to identify the circumstances giving rise to the ground(s)” are, no purpose is served by ignoring the surrounding context and what the tenants, in fact, knew. These circumstances are quite different, for example, to a situation where a tenant is facing eviction for unpaid rent and needs to know how much they are said to owe so that they can determine if they can pay it.
This leads to another, more significant issue – that being the practical consequence of the insufficiency of particulars in the notice not being raised at the hearing. Because this alleged defect was not explored at the hearing, the lessors lost their opportunity seek a correction of the defect.
The tenants submitted in their first submissions on appeal that the defect could not, in any case, have been remedied by the Tribunal, even if an application had been made. This point does not appear to have been pressed in their “Amended” grounds of appeal, but it is useful to deal with it anyway, to demonstrate the problems with raising new grounds on appeal, and the potential for prejudice.
The power to correct a notice to terminate is found in section 59 of the RTA. This section provides:
59 Lessor’s defective termination notice if tenant does not vacate
(1) This section applies if—
(a)a lessor purports to give a termination notice to a tenant; and
(b)the notice is a defective termination notice for any reason, other than because it is not given in accordance with this Act.
(2) The lessor may apply to the ACAT for—
(a)an order correcting the defect; and
(b)a termination and possession order.
(3) The ACAT must not make an order under subsection (2) unless satisfied that the defective termination notice did not, and is not likely to, place the tenant in a significantly worse position than the tenant would have been in had the notice not been a defective termination notice.
A ‘defective termination notice’ is defined in the RTA dictionary as:
defective termination notice means a notice that—
(a) if there is a form approved under section 133 (Approved forms—Minister) for a termination notice—is not in the approved form; or
(b) if there is no form approved under section 133—does not contain the information required by the standard residential tenancy terms; or
(c) is not given in accordance with this Act.
The tenants say that the failure to comply and include “particulars” as required by standard term 83 means the notice is defective “because it is not given in accordance with the Act.”
What is the meaning of “given in accordance with this act”? The section in which the words are found, section 59, was inserted into the RTA by operation of the Residential Tenancies Legislation Amendment Act 2023, and a review of the Explanatory Memorandum to the relevant bill does not say what was intended by defects in the “giving” of notice. However, the definition of ‘defective notice of termination’ found in the RTA dictionary makes it clear that there is a difference between a notice that “does not contain the information required by the standard residential tenancy terms”, and a notice that “is not given in accordance with this Act.” Having regard to that distinction, the word “given” suggests that the relevant distinction is the “giving” of the notice – that is, the service of the notice. The purpose of the provision appears to be that the tribunal cannot correct a defect in service (i.e. how the notice is given), but it can correct a defect relating to a lack of “prescribed information.” In other words, the tribunal cannot correct a defect in whether the notice was given, but it can correct a notice that was given but was not otherwise compliant with the RTA.
We note, too, that there is another provision in section 83(1)(l) of the RTA, which provides that the tribunal may make “an order correcting a defective termination notice”, and this power is subject only to the limitation in subsection (2), that:
The ACAT may make an order under subsection (1) (l) only if satisfied that the defective termination notice did not, and is not likely to, place the person receiving the notice in a significantly worse position than the person would have been in had the notice not been defective.
At first, sections 59 and 83(1)(l) appear to be somewhat contradictory. However, there is a principle of statutory interpretation that a specific provision will prevail over a general provision. As section 59 is stated to apply “to a defective notice if the tenant does not move out”, and that is the scenario in this case, it would apply in this case.
The differences between the provisions are illuminating as to the probable reasons for the contrary language used in the sections. Section 59 deals with a situation where a notice was served incorrectly, and the tenant has not vacated – in such circumstances, the tribunal may not correct a failure to properly serve the notice, as to do so would deprive the tenant of any opportunity to move out in accordance with it (although it would presumably remain open to the tribunal to correct a defect in service before the vacate date). However, where the tenant has been given the notice, and is aware of what is asked of them, but there is some defect in form or substance, it remains open to the tribunal to correct any defects, where there is no prejudice to the other party in doing so.
The interaction between the two previous, albeit different, versions of these sections was discussed at some length by Presidential Member Daniel, as she then was, in Ikechukwu v Duong (Ikechukwu).[7] The previous version of section 59, considered in this case, allowed for the “waiver” of defects if the notice was either not in the approved form (under section 133 of the RTA), or was served in the manner prescribed by regulation, as contrasted with the power to “correct” a defective notice in section 83(k). Considering the scope of the power to “correct” a defect in section 83(k), Presidential Member Daniel observed:
The High Court has said, albeit in a different context, “It is quite inappropriate to read provisions conferring jurisdiction or granting powers to a court by making implications or imposing limitations which are not found in the express words.” The same principle might be called upon here. While the argument that there are some defects that are so substantial that they just cannot be rectified is intuitively attractive, on close examination of the legislation and consideration of its purpose and extrinsic material I cannot identify any basis to imply such a limitation in the application of section 83(k). On the contrary, neither the RT Act nor the ACAT Act, under which the tribunal operates would seem to be intended to require parties to master technical points of service or drafting in order to access the tribunal and enable its jurisdiction to resolve disputes to be called upon.
…
The tribunal’s correction power under section 83(k) is a broad discretionary power designed to be exercised judicially, in the circumstances of each case, to do substantial justice between the parties. At a minimum this requires reference to the type of notice, the purpose of the requirement in relation to which the notice or its service is defective, and the impact of the defect upon the person to whom the notice was given. Other factors may also be relevant.
As the tribunal has commented in previous cases, much will turn upon the individual circumstances. A substantial defect may in one case have been of little account, and thus be corrected, where in another case a less significant defect has the effect of misleading the recipient as to their obligations and will not be corrected […]
[7] [2018] ACAT 97
The reasoning in Ikechukwu refers to what was then section 83(k) of the RTA, and draws a distinction between that section and section 59. But, these sections have since been amended, with section 59 amended to make it closer in language and effect to section 83(k), particularly in terms of “correcting” rather than “waiving” a defect. Section 59 previously provided:
Lessor’s defective notice if tenant does not vacate
(1) If—
(a)a lessor purports to serve a termination notice on a tenant; and
(b)the notice is not—
(i)in the form approved under section 133 (Approved forms—Minister) for a termination notice; or
(ii)served as prescribed by regulation; and
(c)the tenant does not vacate the premises;
the lessor may apply to the ACAT for a waiver of the defect in the notice or in the service of the notice and for the making of a termination and possession order.
(2) The ACAT must not waive a defect in a termination notice or its service and make a termination and possession order unless satisfied that the defect did not, and is not likely to, place the tenant in a significantly worse position than the tenant would have been in had the notice been in, and served in, accordance with the standard residential tenancy terms.
Section 83(k) used to read:
Without limiting the orders the ACAT may make, the ACAT may make the following orders in relation to an application about a tenancy dispute or occupancy dispute:
...
(k) an order correcting a defect in a notice or in the service of a notice.
Due to this amendment, the power should not be read narrowly, although much will depend on the circumstances of the case, and the exercise of discretion.
We are satisfied that a failure to include particulars is not a failure to give a notice in accordance with the RTA, but rather another, curable form of defect. This is entirely consistent with the usual meaning of “defects”.[8]
[8] See, for example, the observation of the Full Bench of the High Court in Adams v Lambert [2006] HCA 10 that: “A failure to comply with a requirement, to be found in the Act, imposed by reference to the regulations as to information to be furnished by the notice, is a defect or irregularity.”
What this means is that, had the tenants applied to have the notice set aside as defective, and had the lessors made an application to the Original Tribunal to correct their notice, there is no reason why this provision could not have been used by the Tribunal to correct the defective notice, had the lessors so applied. We say this because:
(a)The tenants were aware of the damage to the property;
(b)The tenants had themselves undertaken work to understand and mitigate the extent of the damage – e.g. removing the carpets;
(c)The tenants had been in constant communication with the agents;
(d)The tenants would have understood that an application would be made to terminate the lease;
(e)The tenants agree the property is uninhabitable;
(f)The sensible, practical thing is for this house to be empty so that the lessors can undertake the significant, incontestable work needed to remediate it, and no purpose is served in failing to rectify a notice where everyone is well aware of the factual position, and in agreement that the property cannot be lived in.
To reach the conclusion that a defect of this kind could not be corrected by section 59 of the RTA would be to import to the legislature an overwhelming preference for form over substance. That should not be done, particularly when we are dealing with a situation like the present where the consequences of finding notices invalid for reasons of form are serious. We are satisfied that, given the purpose of this section is to allow for the correction of mistakes in termination notices, the mistake that was made in this case, viewed in context, falls within its terms.[9]
[9] [2006] HCA 10 at [34]
Of course, the issue of correction in this case is all hypothetical because no application was made. But this is precisely the kind of problem that arises in conducting an appeal where the appealing party did not properly participate in the hearing below. It gives rise to speculation, like this, as to what could have been, and in turn to a degree of prejudice to the other party, because they could not respond. For this reason, in our view, it is unreasonable and prejudicial to allow the appellant in this case to raise this defect now, at this stage in the proceeding, and deprive the lessors of the opportunity to seek amendment of the notice.
It is not impossible to remedy the prejudice. The Appeal Tribunal could, one supposes, proceed to consider the matter in any case, and perhaps, if satisfied there was an error of law, set aside the decision of the Original Tribunal and reconsider the matter afresh. However, to summarise, the situation is this: the Tribunal is satisfied both that it has the power to correct a defect as to the omission of information of the kind alleged to have been admitted in this case, and that it would be appropriate to do so, were it invited to do so. Hence, even in the event that the Original Tribunal made an error of law in failing to consider section 83, and or an error of fact in determining that the notice to vacate met the requirements of that standard term, then the appropriate thing for this Tribunal to do, in exercising its powers, would be to reopen the proceeding, invite the lessors to make an application to correct the notice, hear the parties, and in all likelihood, given the very clear and uncontested common agreement between the parties, amend the notice to vacate; to state the commonly understood, uncontested reality that the property is uninhabitable by reason of water damage, mould, and the need for the investigations identified by Mr Hingee. This is not a sensible nor proportional approach to these proceedings, particularly in circumstances where none of these arguments (the defect, nor the correction) were put to the Original Tribunal, because the tenants did not attend.
In the circumstances, this Tribunal:
(a)Is satisfied that the Original Tribunal did not materially err in fact, in finding that the notice to vacate met the requirements of the RTA and Standard Terms, despite the absence of detailed particulars, in circumstances where it was understood and undisputed by all parties that the property was not habitable and where the tenants had in any case commenced living elsewhere on that basis; and
(b)Even if the Original Tribunal did err in fact, in finding that the notice to vacate met the requirements of the Standard Terms, it is not appropriate that this matter be raised on appeal, in circumstances where doing so denies the lessors the opportunity to make an application to correct the defect and there is real prejudice to them; and
(c)Even if it were appropriate to raise the matter on appeal and for the Tribunal to substitute its own opinion, it would be open to the Appeal Tribunal to reopen proceedings and invite an application by the lessors to correct the defect, and it would do so. Hence, no materiality error is found in the decision, and the Tribunal declines to reopen the matter.
As such, no material error of consequence is made out. This ground of appeal is not established.
Ground 2 - The notice is invalid because the lessors’ application for termination and possession is retaliatory
Section 57 of the RTA deals with retaliatory actions and provides:
57 Retaliatory applications
(1) This section applies if—
(a)a lessor has applied for a termination and possession order under this part; and
(b)the ACAT is satisfied that—
(i)1 or more of the following happened:
(A)the tenant applied to the ACAT for an order in relation to the lessor;
(B)the tenant complained to a government entity in relation to the lessor;
(C)the tenant took reasonable action to secure or enforce the tenant’s rights;
Example
the tenant sought legal advice or mediation
(D)the ACAT made an order in favour of the tenant against the lessor;
(E)the tenant published information, or disclosed information that was published, about the premises, the residential tenancy agreement, or the lessor; and
(ii)for the event mentioned in subparagraph (i) (E)—the tenant did not, knowingly or recklessly, publish or disclose information that was false or misleading; and
(iii)the lessor was motivated to apply for the termination and possession order because of an event mentioned in subparagraph (i).
(2) The ACAT must not make the termination and possession order.
(3) In this section:
information includes an allegation, complaint or opinion.
publish includes communicate.
In summary, section 57(1)(b)(i)(C) of the RTA provides that where the lessor has made an application to the ACAT for termination and possession, and the tenant presents evidence that “the tenant took reasonable action to secure or enforce the tenant’s rights”, the tribunal must refuse to make an order for termination and possession if satisfied that the tenant did take such action and the lessor was motivated to pursue a termination and possession order as a consequence. The example given of “reasonable steps” is seeking legal advice or mediation.
The allegation that the termination was retaliatory was another matter that was not raised at the original hearing, not even in the tenants’ email to the tribunal of 27 February 2024. The Original Tribunal did not err in failing to consider a matter that was never raised before it. Had it been raised, the Original Tribunal could have taken direct evidence from the lessors or the agents. As that opportunity has been lost, it is not appropriate that the appellant raise it now. Nonetheless, in the interest of completeness, the Tribunal makes the following observations about this argument.
Even if we assume, for current purposes, that the appellant has provided evidence of what could be considered “reasonable action to secure or enforce” his rights by requesting repairs to the property, and by making claims for compensation, and that the Original Tribunal was under an obligation to enquire into this possibility, there was no evidence before the Original Tribunal (nor any before this Appeal Tribunal) to suggest that the lessors motivations in applying for the termination and possession order were retaliatory. There is plenty of evidence to the contrary. Not only is the extent of the water damage apparent from the photographs before the Tribunal, but the lessors have obtained a professional report deeming the property uninhabitable, and there is no dispute that considerable work will need to be undertaken to bring the property back to a habitable condition. There is nothing in the correspondence between the parties that would suggest any ulterior motive on the lessors’ part beyond getting the property assessed and repaired. This cannot happen with a tenant in situ. Nor is there are evidence of a dispute or disagreement between the parties, prior to the flooding damage, that would suggest any reason for a retaliatory decision. To the extent that there was a breakdown in the relationship between the tenants and the agents, on the material before the Appeal Tribunal, that only appears to have happened after the property was damaged, when relationships, unfortunately but perhaps understandably, frayed, and by that stage the property was uninhabitable.
The Appeal Tribunal is not satisfied that the Original Tribunal erred in law by failing to consider whether the termination was retaliatory. Moreover, the Appeal Tribunal sees no basis upon which it could be concluded, as a matter of fact, that the T&P application was a retaliatory application. This ground is not established.
Ground 3 – That the Original Tribunal erred in proceeding in circumstances where the lessors had not properly authorised its representative
Briefly stated, the appellant argues that the power of attorney documents lodged by the lessors, through their agents, were defective. His arguments are several, and include:
(a)The form allegedly contains a typographical error, and it is “unclear whether the form has been authorised by the Minister” under section 96 of the Powers of AttorneyAct 2006 (the POA Act);
(b)The form is not clear as to whether the agents are authorised to act generally or in only one case;
(c)The form does not indicate whether the agents are authorised to resolve the proceedings without the lessors’ consent;
(d)The forms do not appear to have been filled out by the principals;
(e)The forms grant power to “Harry Enright and Claudia Pipitone C/O LJ Hooker Belconnen” and it is unclear whether appointed individually, noting that a power of attorney (POA) cannot authorise a company.
The appellant concedes that “the above may be considered nitpicks but for the fact that the owners have not indicated that they are aware of this case, let alone granted power of attorney to the agents, despite repeated requests from the tenants for verification”. Accordingly, he claims, the Original Tribunal erred in allowing this case to proceed without verifying that the owners are aware of the proceedings.
This ground was raised in the email submission that was before the Original Tribunal. While not expressly put to the Tribunal, we are satisfied that it is appropriate to deal with it on appeal.
By way of background, a lessor and their agent will likely enter into an agency agreement, in the form of a contract. This is not a matter for the tribunal, and the tribunal rarely requires a copy of this document. What the tribunal does require, for its purposes, is that where a person is represented by an authorised representative, that representative provides evidence of that authorisation. This is reflected in rule 41(4) of the ACT Civil and Administrative Tribunal Procedures Rules 2020, which provides that:
4) If the authorised representative holds a power of attorney, for the matters set out in rule 42 (1), made under the Powers of Attorney Act 2006 or equivalent legislation for a party who is a person who does not have a legal disability, the representative must lodge the power of attorney at the tribunal.
The purpose of this rule is to give the tribunal comfort that a representative who purports to appear on behalf of another party is appropriately authorised to do so. This is particularly important where, for example, the parties intend to settle and make binding consent orders.
The existence of a POA has no effect on the validity of the agency relationship between the lessor and the agent, or the relationship between the lessor and the tenant.
The residential tenancy agreement, signed by the tenants, clearly identified that the lessors’ licenced agent is LJ Hooker (at Item 3). The agreement itself is under the LJ Hooker letterhead. The tenants dealt with Mr Enright and Ms Pipitone throughout the tenancy. The tenants could not have been taken by surprise by the role to be played by the agents in these proceedings.
The POAs in issue were attached to the application filed with the tribunal. The member did not mention them in the original hearing, but we assume she reviewed them beforehand, as would be usual, and found no error. This Appeal Tribunal has done likewise. We are not satisfied that there is, or was, anything untoward with the POAs. The forms are in the standard format, as located on the tribunal’s website. It identifies the representatives of Harry Enright and Claudia Pipitone. The “C/o” LJ Hooker” that follows the names is superfluous but does not undermine the identification of the two individual employees who are appointed as attorneys. The forms do appear to have been filled out by the same person, but in our experience, the routine information in the form is often filled in by a real estate agent, or by one lessor on behalf of the others. There is nothing inappropriate about that process, so long as the parties signing the document do so individually, with knowledge of what they are signing, and in the presence of the witnesses. In this case, there is nothing to suggest that was not done. In this case, the deponents and witnesses are located in Bangalore, and signed the forms on 1 February 2024. There was no reason for the Tribunal to go behind the POAs.
However, even if we are to assume that there was some defect with the POA, the member’s original decision to proceed in any case would not amount to an error of law. The rules in relation to the provision of POAs are procedural in nature. The member always has the discretion to disapply the rules, and proceed, even in the absence of what would appear to be a valid POA.
Further, this ground, even if established, it not a material ground of error. At most, it goes to whether the representatives were authorised, and it is apparent from this and subsequent proceedings that they were.
This ground of appeal is not established.
Ground 4 – That the Original Tribunal breached procedural fairness during the hearing, including by proceeding in the tenants’ absence and telephoning them during the hearing and by considering the respondent’s submissions, filed on day before the hearing.
The appellant asserts that the Original Tribunal erred in placing phone calls to the tenants during the hearing, in circumstances where “the Tribunal was fully aware that the [tenants] could not attend the hearing and noting the [ACAT Act] allows a Member to place a phone call during the hearing to parties who are not in attendance.”
The appellant does not say what consequence flowed from this, either generally or in relation to a breach of procedural fairness. The Tribunal is at a loss to identify any prejudice caused by the phone call.
The tribunal has an obligation to observe natural justice and procedural fairness.[10] This requires that the tribunal provide an opportunity for a person to be heard. The focus is on the opportunity, not on whether it is taken up. In Allesch v Maunz,[11] the High Court per Kirby J said:
[I]t is worth emphasising that the principle just described does not require that the decision-maker actually hear (or receive the submissions of) the party potentially liable to be adversely affected. Sometimes, through stubbornness, confusion, misunderstanding, fear or other emotions, a party may not take advantage of the opportunity to be heard, although such opportunity is provided. Affording the opportunity is all that the law and principle require.
[10] ACT Civil and Administrative Tribunal Act 2008 s 7(b)
[11] [2000] HCA 40 at [38]
The tenants having indicated that they did not wish to attend the hearing, the Original Tribunal was under no obligation to contact them. Nonetheless, the Original Tribunal offered the tenants a further opportunity to do so by way of the phone call. Mr Tabak did not answer, and Ms Feangfu did not wish to avail herself of that opportunity. Far from being a breach of procedural fairness, the Original Tribunal’s approach of offering both tenants a further opportunity to participate enhanced procedural fairness.
There was no error in the Original Tribunal’s approach, and indeed the Original Tribunal went beyond what it was required to do to seek the views of the tenants. Even if there were an error, which there is not, it was not a material error, as it made no difference to the outcome of the hearing.
This ground is not made out.
In relation to whether the Original Tribunal considered the lessors’ submissions, filed on 27 February 2024, it is not clear whether the Original Tribunal did do this. However, even if she did, there is nothing in the submissions that the agents did not say to the Tribunal when they attended the hearing. The tenants, in any case, also filed their email submission the day before the hearing. As noted above, the Tribunal has an obligation to provide a party with an opportunity to present their case and answer the case against them, and that opportunity was provided to the tenants, to which they declined to take it.
We are satisfied that there was no error on the Tribunal’s part in proceeding with the hearing in the tenants’ absence, in circumstances where they were clearly aware of the proceedings, and chose not to attend and participate.
Further observations
Although not strictly related to the appeal, the Tribunal makes a further observation.
Why the tenants would wish to remain the tenants of an uninhabitable property was, at first, perplexing. After all, the appellant at no time contested that the property was, in fact, habitable. He had moved out.
What we do understand the appellant to be arguing is a consequence that follows from the operation of standard term 87 of the RTA. This provision, which deals with termination where premises are unhabitable, provides:
(1) In either case the lessor must give not less than 1 week’s notice of termination of the tenancy, and the rent abates from the date that the premises are uninhabitable.
(2) The tenant may give 2 days notice of termination of the tenancy.
(3) If neither the lessor nor the tenant give notice of termination of the tenancy, the rent abates for the period that the premises are unable to be used for habitation, but the tenancy resumes when they are able to be used again.
Relying on standard term 87(3), the appellant suggests that because “neither the lessor nor the tenant” have given a valid notice of termination of the tenancy, the tenancy remains on foot, and will resume when the premises are able to be used again.
In a situation where the rental market is as tight as it notoriously is, it is understandable that the appellant may wish to maintain a right of return. However, this is not the purpose of this standard term 87(3). The standard term recognises that in certain, serious and unfortunate circumstances, a lease can be frustrated by the subject property becoming unavailable for an indefinite period by reason of no longer being fit for purpose. Uninhabitability of this kind requires something more than a short, fixable problem; it goes to whether the property is fit for the purpose for which the lease was entered. In such circumstances, the contract is frustrated, and legislation sets out the options to the parties in that unusual circumstance, including bringing the lease to a practical end and releasing both from their obligations, if that is what they want. Of course, that may not be what they want. It seems standard term 87(3) is less about allowing the tenant a “right of return” than it is about allowing both parties to choose to let the tenancy continue, notwithstanding that agreement cannot be performed by either for some time. That is not the case here.
Much of the tenants’ objections to this process, including the grounds set out in their email submission, also go to their claims for compensation against the lessors. The tenants may well have a right to compensation for the loss they have suffered by reason of the breach of their right to quiet enjoyment, whether before or after the property was declared uninhabitable, but no such claim is before the Appeal Tribunal, and nor was one before the Original Tribunal. As this Appeal Tribunal has indicated to the tenants, they will need to make any such claim separately. These matters are not relevant to the question of whether the Original Tribunal made an error of fact or law in these proceedings.
In any case, it would be impractical and unrealistic for the Tribunal, absent some legal obligation to do so, to reinstate a lease that is fundamentally frustrated, or to allow such a lease to remain on foot but suspended, pending its possible reactivation some uncertain time in the future.
Conclusion
No error of fact, law, or discretion is established.
The appeal is dismissed.
………………………………..
Presidential Member H Robinson
For and on behalf of the Appeal Tribunal
| Date(s) of hearing: | 19 April 2024 |
| Appellant | In person |
| First Respondent | In person |
| Second Respondent | In person |
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