Thomson v Rosedale Investments Pty Ltd; Rosedale Investments Pty Ltd v Thomspon (Residential Tenancies)
[2021] ACAT 12
•22 February 2021
ACT CIVIL & ADMINISTRATIVE TRIBUNAL
THOMSON v ROSEDALE INVESTMENTS PTY LTD & ORS; ROSEDALE INVESTMENTS PTY LTD v THOMSPON (Residential Tenancies) [2021] ACAT 12
RT 429/2020 & RT 463/2020
Catchwords: RESIDENTIAL TENANCIES – rejection of evidence lodged but not served on other party – failure to comply with directions – lessor failure to repair – lessor failure to maintain -
Legislation cited: ACT Civil and Administrative Tribunal Act 2008 ss 6, 7, 48
Residential Tenancies Act 1997 s 37 standard terms 55, 56, 57, 83
Cases cited:Brogan Prestige Properties v Strand & Black [2010] ACAT 60
Cope & McEachern v Walker & Walker [2018] ACAT 65
CIC Australia Ltd v Australian Capital Territory Planning and Land Authority, Maniore Pty Ltd and ACT Civil and Administrative Tribunal [2013] ACTSC 96
Farmer v Farrado Enterprises Pty Ltd [2008] NSWCTTT 1327
Grant v Jackson [2008] NSWCTTT 1269
Halcombe v Hitchman [2018] ACAT 5
Hilton v Lee [2008] NSWCTTT 800
Hope Allan v Eldershaw [2009] NSWCTTT 539
Sharp v Dullabh [2009] NSWCTTT 450
Yalcinkaya v Kayrouz [2012] NSWCTTT 9
Tribunal: Senior Member K Katavic
Date of Orders: 22 February 2021
Date of Reasons for Decision: 22 February 2021
AUSTRALIAN CAPITAL TERRITORY )
CIVIL & ADMINISTRATIVE TRIBUNAL ) RT 429/2020
BETWEEN:
GEMMA THOMSON
Applicant/Tenant
AND:
ROSEDALE INVESTMENT PTY LTD ACN 100 216 215
Respondent/Lessor
TRIBUNAL:Senior Member K Katavic
DATE:22 February 2021
ORDER
The Tribunal orders that:
1.Bryan Anthony Caroll and Nicholas Joseph Andric are removed as parties to this application.
2.The lessor must pay the tenant the sum of $2,671.45, comprising:
(a)$300 compensation for the failure to maintain the carpet; and
(b)$2,371.45 being a rent reduction of $40 per week for 59 weeks and 2 days for the failure to repair the main bathroom.
………………………………..
Senior Member K Katavic
AUSTRALIAN CAPITAL TERRITORY )
CIVIL & ADMINISTRATIVE TRIBUNAL ) RT 463/2020
BETWEEN:
ROSEDALE INVESTMENT PTY LTD ACN 100 216 215
Applicant/Lessor
AND:
GEMMA THOMSON
Respondent/Tenant
TRIBUNAL:Senior Member K Katavic
DATE:22 February 2021
ORDER
Noting that the lessor’s application was granted on 16 July 2020, the Tribunal orders:
1.The tenant’s counterclaim is dismissed
………………………………..
Senior Member K Katavic
REASONS FOR DECISION
Introduction
1.The parties in these proceedings entered into a residential tenancy agreement for a property in O’Connor in the ACT commencing 22 June 2016 for a 12-month fixed term. The tenant was required to pay rent of $660 per week. The property comprised of a three-bedroom home with two bathrooms, one of which was an ensuite to the master bedroom. The property was managed by an agent, Ms Baljeet Kaur of Luton’s Gungahlin for the duration of the tenancy.
2.The tenancy came to an end on 16 July 2020 by an order of the tribunal. The tenant vacated the property in accordance with those orders on 6 August 2020.
3.During the tenancy, and for the purposes of this matter, issues were reported regarding repairs and maintenance in relation to the main bathroom, carpet in the master bedroom, the heating/cooling system, irrigation and carpet in the lounge.
4.On 26 May 2020, the tenant commenced proceedings seeking, amongst other things, compensation in the form of rent reduction for repairs she says were reported but not carried out by the lessor in breach of clauses 55 to 57 of the standard residential tenancy terms (the Compensation Claim). The orders sought and specific issues raised in the tenant’s application are discussed in further detail below.
5.The lessor made an application to the tribunal for a termination and possession order on the basis that the property was to be sold. On 5 February 2020, the tenant was served with a termination notice providing eight weeks to vacate but she did not do so (the February NTV). The tenant regarded the termination notice to be retaliatory following a history of requests regarding repairs.
6.On 16 July 2020, the tribunal heard the lessor’s application for a termination and possession order. In response, the tenant claimed the notice to vacate dated 5 February 2020 was retaliatory and made a counterclaim for compensation in respect of issues common to her earlier compensation claim (the Counterclaim). It is also dealt with in further detail below. After hearing from the parties, the Tribunal ruled that the notice to vacate dated 5 February 2020 was not retaliatory and granted the orders terminating the tenancy, but suspending the operation of those orders for a period of three weeks, requiring the tenant to vacate the property on or before 6 August 2020. The tenant vacated on that date. The bond was returned to her in full.
7.The outstanding matters which require determination by the Tribunal are the Compensation Claim and the Counterclaim. These claims were heard together.
The claims before the Tribunal
8.In her Compensation Claim the tenant sought a range of orders summarised as follows:
(a)Repairs to the flooring in the master bedroom and lounge.
(b)Repair and replacement of the ducted heating completed within 14 days.
(c)The termination notice dated 5 February 2020 be declared retaliatory and rescinded.
(d)A retrospective rent reduction of $330 per week for water damage from the main bathroom from 14 June 2018 for 17 weeks, totalling $5,610.
(e)A retrospective rent reduction of $100 per week for carpet damage from 5 September 2017 for 188 weeks, totalling $17,685.[1]
(f)Costs.
(g)Referral to the Commissioner for Fair Trading to investigate the lessor and the property manager.
[1] The tenant noted that her claim was to be reduced to fall within the Tribunal’s jurisdictional limit of $25,000
9.In her Counterclaim the tenant sought the following orders:
(a)A declaration that the notices to vacate were retaliatory.
(b)Retrospective rent reduction of $330 per week to be applied for 75 weeks incomplete repairs, totalling $25,000.
(c)The matter be referred to Fair Trading for investigation intervention.
10.The specific form of these orders evolved by the time the matters were listed for hearing. Considering the tenant vacated the property on 6 August 2020, not all the orders sought by the tenant were pressed at the hearing. There was also some duplication of the relief sought between the Compensation Claim and the Counterclaim. The tenant is not entitled to the same relief for the same alleged breaches twice simply because there are separate proceedings. This is discussed in more detail below.
11.The tenant maintained her claim that the notice to vacate dated 16 May 2019 was invalid as it was retaliatory. She maintained her claim for relief in respect of the lessor’s breach of clauses 55 and 57 of the standard residential tenancy terms[2] (the standard terms) regarding the periods for which repairs to the bathroom, carpet in the master bedroom, carpet deterioration elsewhere in the property, the air-conditioning unit and irrigation system were not carried out. No specific orders were sought in relation to the irrigation system. Therefore, I do not propose making any orders in respect of the irrigation issue.
[2] Residential Tenancies Act 1997, schedule 1, applicable to the Residential Tenancy Agreement between the parties dated 5 December 2018 by virtue of item 18
12.Clauses 55-57 of the standard terms govern the lessor’s obligations regarding repairs.
Lessor to make repairs
55 (1) The lessor must maintain the premises in a reasonable state of repair having regard to their condition at the commencement of the tenancy agreement.
(2)The tenant must notify the lessor of any need for repairs.
(3)This section does not require the tenant to notify the lessor about anything that an ordinary tenant would reasonably be expected to do, for example, changing a light globe or a fuse.
56 The lessor is not obliged to repair damage caused by the negligence or wilful act of the tenant.
57 Subject to clause 55, the lessor must make repairs, other than urgent repairs, within 4 weeks of being notified of the need for the repairs (unless otherwise agreed).
13.The tenant claims as follows:
(a)Repairs were required to the main bathroom due to water leaking, and these were not carried out within the four-week period required by clause 57.
(b)Repairs were required to water affected carpet in the main bedroom because of the water leaking from the main bathroom, and these were not carried out at all up to the time she left the premises.
(c)Repairs were required to the heating/cooling system which were not carried out at all up to the time she left the premises.
(d)The lessor was required to maintain the carpet in the lounge and did not do so.
(e)The notice to vacate dated 16 May 2019 was invalid as it was retaliatory.
14.The following documents were before the Tribunal and taken into evidence:
(a)Residential tenancy dispute and attachments lodged on 26 May 2020.[3]
(b)Tenant’s bundle of documents comprising annexures A to M (98 pages) filed and served on 21 July 2020.[4]
(c)Tenant’s counter claim in RT463/2020 and attachments dated 15 July 2020.[5]
(d)Tenant’s further documents comprising orders sought, statement of Andrew Snell, and timeline of events filed and served on 8 September 2020.[6]
The lessor’s evidence
[3] Exhibit A1
[4] Exhibit A2
[5] Exhibit A3
[6] Exhibit A4
15.On 29 June 2020, the lessor’s agent sent to the tribunal a bundle of documents attached to an email. The tenant was not included in that email. This communication is inconsistent with the tribunal’s Practice Note No.3 dated 3 February 2020 which requires any party communicating with the tribunal must include each other party in that communication. The lessor’s agent did not comply with that Practice Note. Further, there were two conferences held in this matter, first on 22 July 2020 and later on 25 August 2020. The matter was initially listed for hearing on 26 October 2020 but did not proceed on that day.
16.The issue of whether the lessor’s documents had been properly lodged does not appear to have been raised at either conference or at the vacated hearing. Nonetheless, on 25 August 2020 the tribunal made directions preparing the matter for hearing. The lessor was required to give to the tribunal and the tenant by 29 September 2020 any response, a written timeline of events, any witness statements, and any other material it intended to rely upon at the hearing. The lessor did not send to the tribunal or the tenant anything in accordance with this direction.
17.At the commencement of the hearing, the tenant confirmed she did not receive the lessor’s bundle of documents sent to the tribunal on 29 June 2020 and did not receive any other material to be relied upon by the lessor. The lessor’s agent conceded that she did not send the bundle of documents attached to the email of 29 June 2020 to the tenant, and had not sent any further material to the tribunal and/or the tenant in support of the lessor’s case. As at the commencement of the hearing, the tenant had never seen the material sent to the tribunal by the lessor’s agent on 29 June 2020.
18.I rejected the lessor’s reliance on the material lodged on 29 June 2020 and refused the lessor’s request to provide further evidence or for evidence to be given orally. The agent’s failure to send the material of 29 June 2020 to tenant might be regarded as an oversight. However, there was ample opportunity to remedy such an oversight by re-sending the material or complying with the direction. The agent did not avail herself of these opportunities. Presumably, some preparation occurred in relation to the hearing listed for 26 October 2020 thus presenting a further opportunity to remedy the state of the lessor’s evidence. It was not remedied.
19.Directions made by the Tribunal are critical to a matter being ready for final hearing. A failure to comply with directions has consequences. In certain cases, it may result in the hearing being adjourned so that evidence can be filed. This delays proceedings being finalised. It may enliven an order for costs against that party under section 48 of the ACT Civil and Administrative Tribunal Act 2008 (ACAT Act) depending on the circumstances, or the Tribunal may refuse to allow a party to adduce evidence for the first time at hearing and proceed to hear the matter on the evidence available. This was the situation the lessor found itself in at the commencement of this hearing and during the course of the hearing. Of course, there may be exceptions to that approach.
20.A party may choose not to rely upon evidence and not file any documents in accordance with such directions. However, a party making such an election cannot complain of evidence being deficient later when the matter is being heard without consequence.
21.I was satisfied against the procedural background set out above, that it was not appropriate to allow the lessor to rely upon the material sent to the tribunal on 29 June 2020 or present further oral evidence at the hearing. To do so was, in my view, inconsistent with sections 6 and 7 of the ACAT Act. It is the responsibility of parties to prepare for hearing properly and correctly, and comply with directions made. I proceeded to hear the matter based on the material set out at [14] above.
22.Considering this, I applied the same approach to any additional oral evidence from the tenant. She had not filed a witness statement setting out her evidence. I therefore refused to allow the tenant to give oral evidence in addition to the documents she had submitted. To the extent the tenant may have done so during her oral submissions I have not had regard to such evidence.
Are the Counterclaim and Compensation Claim the same?
23.The tenant submitted the claims were different and sought different relief. I am not satisfied they are. The compensation claim was lodged first and listed for conference in accordance with the tribunal’s usual practice. The tenant lodged the counterclaim in response to the lessor’s application for a termination and possession order. In both claims the tenant sought compensation in the amount of $25,000.
24.The issue underpinning the Counterclaim was the failure to repair in respect of the main bathroom and carpet to the main bedroom. This much was the same as the compensation claim, albeit the applicant had ‘updated’ the period for which she claimed she was entitled to rent reduction because the failure to repair was ongoing.
25.I do not regard the Counterclaim as being different or separate to the Compensation Claim. Once seized of jurisdiction, parties cannot take advantage of two separate proceedings in the tribunal to seek separate relief. If the issue upon which relief is sought is the same, then the tribunal need only entertain one of those claims, regardless of there being separate proceedings. In this matter the claims were ordered to be heard together. The tenant has therefore not lost the opportunity to agitate her complaint against the lessor. In my view, because the Compensation Claim had been lodged by the time the lessor made its application for a termination and possession, but was listed for a conference after the date on which the lessor’s application was listed for hearing, the tenant purported to ‘fast-track’ her Compensation Claim and encompass it within the proceedings that might have been considered sooner than the Compensation Claim. Inevitably that did not happen as the tenant’s Counterclaim and Compensation Claim were subsequently listed for conference at the same time following the determination of the lessor’s application.
26.At the hearing, the tenant conceded that the orders 5 and 6 sought in the Counterclaim were the same as orders 8 and 9 in the Compensation Claim.
27.I therefore dismiss the counterclaim. I am satisfied that all the issues between the parties are captured in the Compensation Claim and nothing remains outstanding with respect to the Counterclaim.
The main bathroom
28.It is common ground between the parties that on 14 June 2018 the tenant first notified the lessor’s property manager of a leak in the main bathroom, together with water affecting the carpet in the master bedroom. The lessor now rejects any damage to the carpet. This is discussed further below.
29.The lessor was required to complete the repairs by 12 July 2018.[7] After this date, the lessor is in breach of its obligation in clause 57 of the Standard Terms. This might be avoided if an agreement is reached with the tenant as to when the repairs are to be completed. I am not satisfied there was an agreement with the tenant in this case.
[7] This is four weeks from being notified on 14 June 2018.
30.Further, in respect of the bathroom, the lessor did not dispute that repairs were required. The issue as I have understood it was: what was being repaired and how it was to be repaired?
31.Having regard to the evidence before the Tribunal I make the following factual findings:
(a)There was a water leak issue in the main bathroom as at 14 June 2018.
(b)The tenant sent an email to Ms Kaur on this date attaching photos of the problem.[8] The photos show water egress from the bathroom affecting carpet, skirting boards, and architraves.
(c)After 14 June 2018, the lessor arranged investigations by various trades to ascertain the cause of the water leak.[9] The Tribunal does not have before it evidence of the specific trades and the specific investigations that were carried out.
(d)The tenant followed up the status of the repairs several times with Ms Kaur and Mr Andric, a director of the lessor.[10]
(e)On 15 May 2019, the tenant issued the lessor with a notice to remedy.
(f)On 16 May 2019, the lessor issued the tenant with a notice to vacate pursuant to clause 96(d) of the standard terms, requiring the tenant to vacate the property by 6 August 2019 (the May NTV). No details of the major renovations to be carried out were provided, despite the tenant’s request the lessor do so. I am satisfied that, in accordance with clause 83 of the standard terms, the lessor was required to do so.
(g)The tenant did not vacate the property in accordance with the notice. The lessor did not enforce the notice and instead proceeded to repair the main bathroom.
(h)On or about 8 August 2019, the lessor commenced the repairs to the main bathroom.
(i)As at 22 August 2019, there were some minor works outstanding in relation to the bathroom repairs. On 22 August 2019, the tenant sent an email to Ms Kaur noting the bathroom screen would not be fitted until the middle of the following week.[11]
(j)The bathroom repairs were completed on or about 1 September 2019. This is about a four-week period from 8 August 2019 when they commenced.
(k)The time taken to repair the main bathroom from when it was notified was about 15 months.
[8] Exhibit A2 pages 11-15
[9] Exhibit A2 pages 52-61
[10] Exhibit A2 pages 17, 20-21, 51-61
[11] Exhibit A2 page 35
32.The lessor made three broad submissions in relation to the tenant’s claim for rent reduction.
33.First, she failed to mitigate her loss. The lessor submitted, having issued the notice to vacate on 16 May 2019, the tenant was not obliged to remain in the property. She rejected the May 2019 notice as being invalid and retaliatory. Further, the tenancy was a periodic tenancy entitling the tenant to provide 21 days’ notice to the lessor to vacate, which she did not do. Section 38 of the Residential Tenancies Act 1997 requires a party seeking compensation to mitigate any loss, and failure to do so may affect an award of compensation. The lessor also submitted that the tenant used the shower during this period as she reported “it only leaks when it is used’. The lessor invited the Tribunal to conclude from this that the tenant had been using the shower as she was aware it leaked only when doing so. Conversely, the tenant’s comment might be interpreted to mean the tenant does not use the shower because it leaks when used. The Tribunal does not have evidence of the comment attributed to the tenant and given the tenant did not give oral evidence the Tribunal is not able to make a finding that the shower was or was not being used. I am not satisfied it matters.
34.I am not satisfied that the lessor’s failure to repair in accordance with clause 57 is answered by issuing the tenant with a notice to vacate, particularly where such a notice is issued 11 months after the problem is first notified. I am not satisfied that a tenant’s rejection of such a notice is tantamount to a failure to mitigate. The notice to vacate did not comply with clause 83 of the Standard Terms and in any event it is invalid. Clause 83 states:
Notice to vacate by lessor
83 The 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.
35.The tenant was not obliged to vacate the property because repairs were required; the lessor was obliged to carry out the repairs. This obligation cannot be avoided by the lessor, invoking grounds upon which the tenancy might be terminated, or relying upon the tenant to exercise a right of termination. The tenant was not obliged to do so. Such a submission is akin to saying, “like it or leave”. Had it not been invalid for other reasons and not overtaken by later events, it would likely be regarded as a retaliatory notice.
36.The lessor did not enforce the May NTV and the tenant remained in the property while the bathroom repairs were carried out in August 2019 and thereafter, until I made orders on 16 July 2020 terminating the tenancy. Those orders were made based on the February NTV. It is not necessary to decide whether the May NTV was retaliatory, as it was redundant after 6 August 2019 when the lessor elected to commence the bathroom repairs. No steps were taken to enforce the May NTV and the tenant continued to occupy the property.
37.The lessor’s second submission was that the delay was reasonable given the nature of the problem. The delay in completing repairs after 14 June 2018 is unexplained. While there may be an explanation for the delay, it is not in evidence before the Tribunal.[12] The lessor submitted that the investigations took time and that it was necessary to ascertain the cause of the water problem. The Tribunal does not have evidence before it that explains what changed by 8 August 2019 that prompted the lessor to repair the bathroom or why this could not have been commenced earlier.
[12] See above [15]-[22]
38.The tenant relied upon a quotation from Re-seal Bathrooms dated 31 May 2019[13] in support of her claim that the problem was capable of being identified and remedied within a couple of weeks. The lessors submitted that this was unreliable, as the Tribunal cannot be satisfied as to what investigations were conducted or what problem was identified, therefore the Tribunal should give it little weight. The Tribunal does not have evidence before it as to what caused the water leak, what work was required to repair the leak and what work was ultimately carried out. Repairs of some kind were done. Whether this is the same as the Re-Seal quotation is unclear. I have treated the Re-Seal quotation as indicative of the time that it might reasonably take to diagnose a problem in a bathroom and repair it. However, I cannot attribute much weight to it as I do not know what the problem was, what was repaired and whether that was the same as what was quoted by Re-Seal.
[13] Exhibit A2 pages 75-76
39.If the problem with the main bathroom was more complex, requiring more time to diagnose and repair, the lessor should have sought agreement from the tenant as to a reasonable time frame in which to complete that process. It did not do so. Whether or not a more rigorous and intensive approach to resolving this problem was required, a delay of 15 months is unreasonable.
40.The lessor further submitted that the delay was attributable to trades having trouble gaining access to the property. The tenant rejected that submission. The Tribunal does not have before it evidence to support the lessor’s contention. The Tribunal does have some text message exchanges between the tenant and Mr Andric, making various arrangements to access the property.[14] This is indicative of nothing more than the tenant accommodating the requests for access, which were the subject of those text messages. It does not eliminate the possibility that she may have denied access on other occasions. However, there is no evidence of that before the Tribunal.
[14] Exhibit A2 pages 52-61
41.The tenant claims that she is entitled to a retrospective rent reduction of $330 per week between 14 June 2018 and 1 September 2019 because the main bathroom was unusable, and the remaining bedrooms could not be tenanted in a share-house arrangement. She submitted this was not possible because letting those bedrooms during this period meant the occupants would need to use the ensuite located in the master bedroom which she occupied. Regardless of whether the remaining bedrooms could be tenanted, the tenant submitted she was paying full rent for a property she could not fully use.
42.I am satisfied that it is appropriate to award the tenant some reduction in rent. I am not satisfied a reduction of $330 per week is appropriate. A reduction of this amount is equivalent to half the property being unusable. The tenant may have regarded it as being unusable because of her particular living arrangements, but in fact only the main bathroom was affected, the bedrooms were not. The property still had a functioning bathroom, albeit an ensuite. The tenant’s preferred living arrangements and her preference not to have co-tenants while the main bathroom was unusable does not attract a 50% rent reduction. There is no evidence before the Tribunal that the main bathroom was wholly unusable. I am satisfied on the evidence before the Tribunal that the problem was isolated to the shower. Any basin, bath or toilet in the main bathroom could still be used. There is of course the inconvenience of not having the use of the shower to consider.
43.In Cope & McEachern v Walker & Walker,[15] the tribunal held:
The structure of clauses 55-57 and 63 is important. A lessor’s obligation to repair arises if it is established, objectively, that the premises are not “in a reasonable state of repair have regard to their condition at the commencement of the tenancy”. In many cases, damage can occur in situations where neither the lessor nor the tenant is at fault or to blame. In this case, there is no suggestion that the respondents were responsible for the deterioration in the condition of the bathroom. Their obligation to repair the bathroom arose from nothing more than the objective fact that it needed repair, regardless of the cause of the damage, unless they can show that the damage was caused by the applicants “negligence or wilful act”. In other words, the respondents’ primary obligation to repair the bathroom arose regardless of fault, and is excused only if fault on the part of the tenants is established.
[15] [2018] ACAT 65 at [84]
44.The tribunal drew support from Brogan Prestige Properties v Strand & Black[16] which was cited with approval in Halcombe v Hitchman that:
… a lessor's obligation to repair under standard residential tenancy terms 54 and 55 is framed in mandatory terms, i.e. the lessor “shall” maintain the premises in a reasonable state of repair. It is therefore not a defence to any landlord to plead that reasonable steps were taken to rectify either patent or latent defects. The test is whether these defects were in fact remedied such as to maintain the premises in a reasonable state of repair.[17]
[16] [2010] ACAT 60
[17] [2018] ACAT 5 at [48]
45.Whether there is an explanation for the delay in carrying out the repairs or not, taking steps to investigate the cause of a problem is insufficient to avoid the obligation to complete repairs within four weeks of being notified. There is no doubt a vast spectrum of problems which might arise and require repair, ranging from minor issues to the more complex, which I accept require diagnosis to ensure adequate repair. Those are the kind that would attract agreement between lessor and tenant as to a reasonable timeframe. That did not occur in this case.
46.As was the case in Cope & McEachern,[18] it was clear the bathroom needed to be repaired, the tenant notified the lessor of the need for the repair and it follows that the lessor was required to carry out those repairs and was in breach of clause 57 by failing to do so by 12 July 2018, unless the damage was caused by the negligence or wilful act of the tenant. The lessor did not make such a contention. The lessor remained in breach of clause 57 until 1 September 2019 when the repairs were complete. The tenant was entitled to enjoy a bathroom with a shower that did not leak. Any reduction in rent applies from 13 July 2018.
[18] [2018] ACAT 65 at [86]
47.In Hilton v Lee,[19] the tenant was awarded a 10% rent reduction for loss of use of one bathroom in a two-bathroom property due to water problems. As I have noted, the bathroom in this case was only partially unusable. In Grant v Jackson,[20] the tenant was awarded a 20% rent reduction for 249 days while the premises was subject to flooding and the ensuite was unusable. In Hope Allan v Eldershaw,[21] the tenant was awarded a $25 per week rent reduction from $180 per week for partial loss of use of the dining room and a bedroom due to a water leak. In Anderson and Hutchings v Carrier[22] the tenant was awarded a 10% reduction in rent for the loss of use of the master bedroom due to water ingress that the landlord delayed repairing.
[19] [2008] NSWCTTT 800
[20] [2008] NSWCTTT 1269
[21] [2009] NSWCTTT 539
[22] [2009] NSWCTTT 596
48.In other cases, higher amounts have been awarded where a room or rooms are wholly unusable due to water leaks or persistent water damage. In Sharp v Dullabh[23] rent of $700 per week was reduced by $250 per week for the total loss of use of the main bedroom and impaired use of another bedroom for 20 weeks due to water damage. In Farmer v Farrado Enterprises Pty Ltd,[24] a rent reduction of $100 per week was awarded due to water leaks making the third bedroom unusable. In Yalcinkaya v Kayrouz[25] rent of $400 per week was reduced by $70 per week due to water leaking into the main bedroom when it rained causing inconvenience but not a total loss of use of the room.
[23] [2009] NSWCTTT 450
[24] [2008] NSWCTTT 1327
[25] [2012] NSWCTTT 9
49.I am satisfied the present case falls at the lower end of the spectrum, but is exacerbated by the lessor’s delay in carrying out the repairs. I conclude that the tenant is entitled to a rent reduction of $40 per week between 13 July 2018 and 1 September 2019 being a total of 59 weeks and 2 days being $2,371.45 due to the partial loss of one bathroom in a three-bedroom property. The consequence of which is the lessor is to pay to the tenant the sum of $2,371.45.
Carpet in the main bedroom
50.In her email to Ms Kaur dated 14 June 2018, the tenant also notified Ms Kaur that the carpet in the master bedroom adjacent to the wall it shares with the shower was damaged. The carpet was never replaced while the tenant occupied the property.
51.The lessor contends the carpet was not damaged and did not require repair. The basis for that contention is that the carpet was wet not damaged and once the carpet dried out the problem was resolved.
52.The photos relied upon by the tenant show the carpet was affected by water and that the subfloor beneath it may have been water affected.[26] The tenant claims the lessor is in breach of clause 57 because the master bedroom carpet was not repaired within four weeks of being notified of the need to repair. The tenant has not claimed she could not use the master bedroom because of the wet carpet or that it interfered with her use and enjoyment of the master bedroom in any way.
[26] Exhibit A2 page 56
53.The issue is therefore whether repairs were required at all. I am not satisfied the carpet in the master bedroom required repairing. It clearly needed to dry out, but that does not necessarily mean it needed replacing. There is no evidence that the carpet failed to dry out or how long that took. Further, there is no evidence that the carpet was not fit for purpose once it had dried out.
54.I am not satisfied the tenant is entitled to a reduction in rent because of the carpet in the master bedroom. The master bedroom was not unusable and there is no evidence before the Tribunal of any residual effects of the water leak, such as mould, dampness and odour, which affected the tenant’s ability to use the master bedroom wholly or partially.
Heating/cooling system
55.The tenant claimed a reduction in rent attributable to the operation and effectiveness of the heating/cooling system. She claimed it was tripping a switch in the fuse box.[27] She also sought compensation for a portion of her electricity and gas bills which she claims were excessive due to the heating/cooling system. She claims the ducting was disintegrating. The tenant relied upon a series of photos showing the ducting and filters.[28]
[27] Exhibit A2 page 17
[28] Exhibit A2 pages 41-43
56.The lessor disputes the heating/cooling system required repairing and rejects the tenant’s claim for rent reduction and compensation. The lessor relies upon advice from an electrician to the effect that there were no issues with the system following an inspection.
57.In an email dated 2 April 2020, the tenant reported the following to Ms Kaur:
Hi Baljeet,
I just found this in my outbox. It looks like it didn’t send due to a video of the sprinkler leak.
Hi Bal,
I hope you had a lovely Christmas and New Year. We have just returned from Malua Bay. Thankfully we made it out.
We turned on the air-conditioning this morning and the house has filled with smoke. We have added a triple filtered to the inside vent but the smoke is pouring in from the ceiling vents because the ducting is so degraded it’s just sucking in from the roof cavity.
I’ve attached additional makeshift filters to the ceiling in an attempt to improve the air quality in house. You can see the discolouration of the filters from just one day in the smoke.
The air-conditioner has also started tripping the house circuits again.
Can you please have the landlord replace the unit and the ducting as soon as possible. This is an urgent repair and needs to be completed within 14 days…[29]
[29] Exhibit A2 pages 36-37
58.The tenant claimed that the email was drafted and intended to be sent in January 2020 but was not sent until 2 April 2020 as it remained in her email ‘outbox’. Having regard to the terms of the email, I accept that submission. Regardless, the notification date is 2 April 2020 as this is the date the email was actually sent. The issue may have been prevalent earlier, but any obligation to repair by the lessor arises from the date of notification.
59.On 4 May 2020, Ms Kaur sent an email to the tenant as follows:
Hi Gemma,
please see below from electrician who attended to the air conditioner. I hope we are all good with your vacate on 27/5/2020.
I am more than happy to help you locking a rental property if needed.
Upon testing the system we found no issues with ignition or the performance of the system, we then climbed through the roof and checked ductwork where possible and whilst the ductwork is starting to show signs of wear and tear I couldn’t spot any sections with significant tears with foreign matter could be entering the internal lining of the duct.[30] [all errors and emphasis in original]
[30] Exhibit A2 page 44
60.In an email dated 5 May 2020, the tenant rejected the advice provided by Ms Kaur.[31] Ms Kaur invited the tenant to independently engage her own electrician to assess the system and provide advice.[32] The tenant did not do so. The tenant requested the contemporaneous advice given to Ms Kaur by the electrician rather than Ms Kaur’s extract in the email dated 4 May 2020.[33] This was not provided. She submitted that Ms Kaur’s email and the extract of the advice are unreliable and the Tribunal should give little weight to that evidence. On the one hand, the Tribunal does not have any contrary evidence to the advice contained in Ms Kaur’s email despite it being open to the tenant to obtain a second opinion. On the other hand, Ms Kaur’s email is an extract and it is unclear why the complete advice was not provided.
[31] Exhibit A2 page 44
[32] Exhibit A2 pages 43-44
[33] Exhibit A2 page 44
61.In the absence of any other evidence or contrary expert opinion I cannot be satisfied the heating/cooling system required repairing. The tenant bears the evidentiary burden of establishing a need to repair and has not done so. Certainly, the lessor took steps to investigate the tenant’s complaint, but given the advice provided to the tenant, albeit an extract, and in the absence of any contrary evidence, the lessor was not obliged to repair the system and not in breach of clauses 55 and 57 of the standard terms. I am not satisfied the tenant is entitled to any relief in respect of the heating/cooling system.
Carpets generally
62.The tenant claims that by March 2019, the carpet in the lounge had deteriorated to the point it could not be professionally cleaned and it was disintegrating.
63.On 20 March 2019, the tenant sent an email to Ms Kaur stating:
…I don’t know if you remember after our last inspection, we had the carpets cleaned professionally and I mentioned or sent you a note about them? The carpets are disintegrating [sic] to the point that just vacuuming them is pulling the up the pile. The tec [sic] said after the last clean that professionally cleaning them will damage them further, and I’ve noticed that it is getting worse since we had them done last year.
Could you advise what we should do for the inspection given the circumstances?[34]
[34] Exhibit A2 page 22
64.Ms Kaur responded by email advising she would see what the lessor wanted to do about it and offered to push the inspection out a month.[35] It was agreed the inspection would be cancelled to await the advice from the lessor.[36]
[35] Exhibit A2 page 21
[36] Exhibit A2 page 20
65.On 13 April 2019, the tenant sent a follow up email to Ms Kaur.[37] On 15 April 2019 Ms Kaur responded by email advising:
I have just had approval from the owner to get quotes for the similar carpet replacement.
I will send quote request and someone will be in touch with you to provide quote.[38]
[37] Exhibit A2 page 19
[38] Exhibit A2 page 19
66.On 23 April 2019, Ms Kaur sent an email to the tenant regarding access to the property by a carpet business.[39] According to an email later that day from the tenant to Ms Kaur, arrangements had been made for the following Monday.[40]
[39] Exhibit A2 page 88
[40] Exhibit A2 page 88
67.The carpets were not replaced or repaired. The tenant submits the lessor breached clauses 55 and 57 by failing to repair the carpets after she gave notice in March 2019. The lessor submits that they were the subject of fair wear and tear.
68.The tenant reported the damage to the carpet and its deterioration. In accordance with clause 55 the lessor must maintain the premises in a reasonable state of repair having regard to their condition at the commencement of the tenancy. Clause 57 requires the lessor to repair it within four weeks. It did not do so. The lessor accepted the need for repair as it instructed Ms Kaur to obtain quotes. This was abandoned for whatever reason. I am satisfied, based on the condition reports, that the carpets were not in a reasonable state of repair having regard to their condition at the commencement of the tenancy. Whatever the age of the carpet and taking into account fair wear and tear, the lessor was required to maintain and repair it.
69.The tenant is entitled to modest compensation in relation to the lessor’s failure to maintain the carpet in a reasonable state of repair. However, I declined to award a rent reduction as claimed by the tenant. Instead I award $300 compensation.
Costs and referral
70.The tenant also claimed her costs of these proceedings. Costs in the tribunal are governed by section 48 of the ACAT Act. She has only been partially successful in her application. The power to award costs is a narrow one.[41] In CIC Australia Ltd v Australian Capital Territory Planning and Land Authority,[42] Penfold J identified the four main elements of section 48 as:
(a) the default position is that the parties bear their own costs;
(b) the default position may be varied by provisions of the ACAT Act;
(c) the default position may be varied by an order of ACAT;
(d) in four specified circumstances, ACAT may make particular costs orders.[43]
[41] CIC Australia Ltd v Australian Capital Territory Planning and Land Authority, Maniore Pty Ltd and ACT Civil and Administrative Tribunal [2013] ACTSC 96 at [82]
[42] [2013] ACTSC 96
[43] CIC Australia Ltd v Australian Capital Territory Planning and Land Authority, Maniore Pty Ltd and ACT Civil and Administrative Tribunal [2013] ACTSC 96 at [37]
71.I am not satisfied that the circumstances of this case warrant the exercise of the discretion found in section 48.
72.The tenant also requested the Tribunal refer the lessor and property manager to ACT Fair Trading. The Tribunal does not have a specific power to make such a referral. From time to time the Registrar may refer matters depending on the circumstances. I decline to request such a referral in this case. Despite the tenant’s complaints I do not see a need to do so.
Conclusion
73.I am satisfied the lessor breached clause 57 of the standard terms in respect of the repairs required to the main bathroom. The main bathroom was repaired 15 months after the tenant notified the lessor of the water leak. The tenant is entitled to a retrospective reduction in rent for the period 13 July 2018 to 1 September 2019 at the rate of $40 per week. The lessor is to pay to the tenant the sum of $2,371.45.
74.I am not satisfied the lessor breached clauses 55 and 57 of the standard terms in relation to the carpet in the master bedroom and the heating/cooling system.
75.I am satisfied the lessor breached clause 55 in relation to the carpet in the lounge as it was not maintained in a reasonable state of repair. The tenant is entitled to $300 in compensation.
76.The lessor must pay the tenant the sum of $2,671.45 comprising:
(a)$300 compensation for the failure to maintain the carpet; and
(b)$2,371.45 being a rent reduction of $40 per week for 59 weeks and 2 days for the failure to repair the main bathroom.
………………………………..
Senior Member K Katavic
Date(s) of hearing 18 November 2020 Tenant: In person Lessor: Ms B Kaur & Ms J Arnott, authorised representatives
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