Trowbridge v Morris
[2011] NSWADT 207
•07 July 2011
Administrative Decisions Tribunal
New South Wales
Medium Neutral Citation: Trowbridge v Morris [2011] NSWADT 207 Hearing dates: 7 July 2011 Decision date: 07 July 2011 Jurisdiction: Retail Leases Division Before: P H Molony, Judicial Member Decision: The application is summarily dismiss under s 75(g)(ii) of the Administrative Decisions Tribunal Act 1997
Catchwords: Retail leases - unconscionable conduct claim - summary dismissal - res judicata - abuse of process Legislation Cited: Administrative Decisions Tribunal Act 1997 Cases Cited: Attorney-General of NSW v Worldbest Holdings Ltd (2005) NSWLR 557
Blair v Curran (1939) 62 CLR 464
Port of Melbourne Authority v Anshun Pty Ltd (1981) 147 CLR 589
Taylor Farms (Aust) Pty Ltd v A Calkos Pty Ltd & Ord [1999] NSWSC 186
Trowbridge v Morris [2010] NSWADT 18
Trowbridge v Morris (RLD) [2010] NSWADTAP 70Category: Principal judgment Parties: Michael Charles Trowbridge (Applicant)
Voula Morris (First Respondent)
Jeffrey Laybutt (Second Respondent)
Con Morris (Third Respondent)Representation: Applicant in person
Second Respondent in person
File Number(s): 115080
REasons for decision
Introduction
On 7 July 2011 I made orders summarily dismissing Mr Trowbridge's application for an original decision under s 75(g)(ii) of the Administrative Decisions Tribunal Act 1997 (the ADT Act) on the basis that it was frivolous, misconceived and lacking in substance. I have since been asked to provide written reasons for that decision. These are those reasons.
The Application
The application for an original decision was filed on 14 June 2011. It sought to bring unconscionable conducts claims under the Retail Leases Act 1994 (the RL Act) against each of the respondents. The claims related to a lease of shop premises at Pacific Highway, Belmont to Mr Trowbridge by J & V Norris. The retail tenancy ended when Mr Trowbridge vacated on 30 October 2008, having been served with a notice to quit.
The application alleged three grounds for the unconscionable conduct claim, each of which was particularised. Ground 1 alleged, " Violations of the ethical guidelines of the Real Estate Institute of NSW." The particulars were -
Particulars 1.1: It was unethical to fight paying the $271 right up to and including 6/9/10. Mr Laybutt even had the Sheriff involved at my home - he stubbornly refused to credit this $271 even in the Sheriff s order.
Particulars 1.2: It was unethical to refuse my 9/9/08 offer to settle the $271 I claimed in writing 2 yrs earlier. He offered not even $1; l had to attend on 1/6/09 to recover the $271. A refund of what I paid in costs is required because I had to attend on 1/6/09 and keep going.
Particulars 1.3: Eviction notice of 19/9108 was only 7 days; the lease required 30 days. Eviction notice unethically demanded excessive money whether option was valid or not. 25/9/08 letter shows sudden Respondent change to lease option being exercised.
Ground 2 alleged breaches of the RL Act at s 34(1)(d). The alleged breaches were particularised -
Particulars 2.1: This breach "as so classic that the details cannot be disputed. My business interruption insurance paid $5000.00 due solely to this breach. Forensic Accountant's reports shows that I lost $22,120,00 due to this breach.
Particulars 2.2: If the Respondent could have it boths (sic) ways to deem my lease option valid, then my right to exercise my (non-existent) option for 1 year was degraded by this breach. The law requires that I be restored to where I would have been had this breach not occurred. Not only the lost income but ongoing frustration with interference of my 'quiet enjoyment'.
'Particulars 2.3: The effects of the breach were increased by the Respondent's 12/12/07 letter. These effects worsened further by Respondent's refusal to allow my agent to make repairs.
Respondent finally decides to repair his ceiling in May 2009 in order to "tidy up".
Ground 3 alleged that the respondents "deceived the Tribunal with false and misleading statements" and caused -
Particulars 3.1: Ruling that I had delayed/interfered with the landlord's carpet install. These lies caused the unfair decision that I should have been required to install carpet in 1 day. Respondent maliciously withheld informing me of his plan to shift the install onto me.
Particulars 3.2: Ruling that option exercise was proper and in full force. The Respondent was unfairly able to enjoy the benefit of both sides of the option exercise question. The Appeal Panel overruled and decided the option was not validly exercised on its face.
Particulars 3.3: It is a fundamental duty for Mr Laybutt to charge the proper amount of rent. I have proved to him that he never credited the required 75 days of rent he promised.!!
Particulars 3.4: Adverse cost award when Respondent defamed my character with an unfounded personal attack. In the Tribunals 19/1/10 decision the ADT repeated Mr Laybutt's libellous attack without any verification. The ADT uses this libel as a reason to award costs for Mr Laybutt. (ironically this includes paying Mr Laybutt for his time to falsely defame my character.) As I wrote in August 2009, Mr Laybutt must support his libel with dates and quotes where I may have made these alleged unfounded attacks.
Prior proceedings with respect to the retail lease
As is apparent from the particulars this is not the first time in which the Tribunal has been asked to consider the retail lease in question. There is an earlier first instance decision of the Tribunal ( Trowbridge v Morris [2010] NSWADT 18) and a consideration by an Appeal Panel of that decision ( Trowbridge v Morris (RLD) [2010] NSWADTAP 70).
Trowbridge v Morris [2010] NSWADT 18 related to the hearing of a retail tenancy's claim by Mr Trowbridge against Mrs Morris as lessor. Mr Laybutt, a real estate agent, represented her. The application initially included allegations of unconscionable conduct, but Judicial Member Fox summarily dismissed them on 5 February 2009.
The retail tenancy claim was heard and determined by Judicial Member Montgomery. A review of his decision demonstrates that:
- The dispute primarily arose from an incident when the shop premises were flooded in February 2005, after a box gutter clogged during heavy rain. There were delays in having necessary repairs affected; including replacing damaged carpet and installing a new ceiling.
- There was a dispute as to the payment of rent in that period.
- Mr Trowbridge claimed to have suffered a loss of trade due to the state of the premises.
- There was a dispute as to whether there had been a valid and lawful increase in from June 2006 following Mr Trowbridge's exercise of an option.
- There was a dispute as to whether or not Mr Trowbridge was in arrears of rent. This was, in turn, dependant on whether or not the rental increases were valid.
At paragraph [17] of its reasons the Tribunal wrote -
"Mr Trowbridge claimed that he was entitled to:
- $300 for dealing with flooding issues on 22 February 2005;
- $271 for closing his office on 23 March 2005;
- $144 for cleaning and moving furniture to allow repair work on a number of separate days;
- $1,200 for dealing with carpet issues in March 2005; June 2005 and on 12 October 2007;
- a rent free period from 21 February 2005 to 20 June 2005;
- $4,000 lost income from 21 February 2005 to 20 June 2005;
- a rent reduction of 80% of $808.50 for the period 1 November 2007 to 30 September 2008
- a rent reduction of 80% of $890 for the period 1 October 2008 to 31 October 2008.
- $6,520 being moving costs that he incurred as a result of not being given sufficient notice to vacate the premises when a Notice to Quit served on him on 19 September 2008;
- $330 being costs incurred in relation to the Notice to Quit;
- $166.36 being surplus rent that he has paid;
- compensation for loss of business which he quantified at 5% of the $38,000 purchase price of the business."
The 80% figures italicized above were in error: they should have read 20%, as the Appeal Panel later noted.
Mrs Morris cross-claimed seeking arrears of rent.
The Tribunal determined that -
- The Respondent was not liable for damage caused by flooding
- Mr Trowbridge was entitled to a rent free period from 21 February 2005 to 6 May 2005 while repairs were undertaken.
- Mr Trowbridge was not entitled to recover relocation expenses.
- Mr Trowbridge was entitled to -
"19 ... an amount of $271 for closing his office on 23 March 2005 and $144 for cleaning and moving furniture to allow repair work. I also determined that Mr Trowbridge was entitled to an amount of $57 for dealing with carpet issues on 12 October 2007.
20 These amounts are to be off-set against the benefit that Mr Trowbridge gained from the rent free period."
- The balance of Mr Trowbridge's claims were dismissed.
On the cross-claim, the Tribunal determined that the rental increases asserted by the landlord commencing 1 June 2006, 1 June 2007 and 1 October 2008 were correct. The Tribunal concluded at [41 - 42] -
"41 I accept that Mr Trowbridge's rent was in arrears of $1,244.35. As noted above, I have found that Mr Trowbridge is entitled to some of the amounts that he has claimed. I agree that the $472 found to be owing to Mr Trowbridge is to be off-set against the rent that would have been payable for the period 6 May 2005 to 21 June 2005. When that is done, it is clear that the amount of rent the Respondent has foregone exceeds the amount payable to Mr Trowbridge. Therefore, there need be no deduction from the arrears owed to the Respondent.
42 It follows that Mr Trowbridge should pay the Respondent an amount of $1,244.35."
The Tribunal ordered Mr Trowbridge to pay the Respondent's costs of the hearing on 1 June 2009 and of preparing written submissions. The Tribunal observed that a consideration of the merits of the case by Mr Trowbridge "appears to have been absent".
Mr Trowbridge appealed that decision. The Appeal Panel noted that it was conceded by the Respondent that the Tribunal had wrongly proceeded on the basis that Mr Trowbridge had not paid rent for the period 28 April 2005 to 20 June 2005. As a result the Tribunal should not have set-off the amount of $472 against the rental for that period (on the basis that it was rent free).
The Tribunal also had not adjusted the rent to be paid by Mr Trowbridge to allow for its determination of the rent free period (21 February 2005 to 6 May 2005). This resulted in a credit to Mr Trowbridge of eight days ($202.35). The Appeal Panel however accepted, at [12], that Mr Laybutt had deducted that amount from the sum he had enforced under the Tribunal's debt order. As a result the Appeal Panel determined, at [20], that "there is nothing to be gained in continuing to examine this issue."
With respect to Mr Trowbridge's unconscionable conduct claim the Appeal Panel said, at [23] -
"23 In our view, the unconscionable conduct application was untenable for the reasons given by Fox JM, and there was no unfairness in the Tribunal not allowing them to be re-agitated at the main hearing."
With respect to the costs order the Appeal Panel considered it desirable that the costs be paid by Mr Trowbridge be fixed, rather than to be assessed. It fixed those costs at $1,876.75 and ordered Mr Trowbridge to pay the respondent's costs of the appeal fixed at $350.00.
The Directions hearing on 7 July 2011
Both Mr Trowbridge and Mr Laybutt participated in the directions hearing by phone. Mr Laybutt argued that Mr Trowbridge's present application was a mischievous and retaliatory attempt to re-litigate matters which had already been determined, and which occurred some six years ago.
Mr Laybutt advised, in a letter the Tribunal dated 4 July 2011 that I read to Mr Trowbridge, that Voula Morris is deceased: and that Con Morris, her son, had no legal standing in the matter at the time of unconscionable conduct alleged. In summary, Mr Laybutt argued that all the matters raised in Mr Trowbridge's present unconscionable conduct claim had been previously heard and determined by the Tribunal.
Mr Trowbridge denied this. He said that the Tribunal had not previously considered his claim that he was served with a wrongful notice of eviction dated 19 September 2008, which was "unjustified and vexatious". He claimed that this was not addressed at the hearings. He said he had raised the failure to address this issue in his written submissions to the Appeal Panel, but had not addressed it during the appeal hearing due to the Appeal Panel restricting his time. An examination of the Tribunals reasons for decision shows that it found that Mr Trowbridge had been in arrears of rent as a result of his failure to pay rental increases. The Appeal Panel (at [17]) that the service of the notice to quit on Mr Trowbridge led to his deciding to take action against Mrs Morris by making his application to the Tribunal.
Mr Trowbridge said that the dismissal of his initial unconscionable conduct claim was an "absolute mistrial," and that he wished to have those issues heard by the Tribunal. I pointed out to Mr Trowbridge that the Appeal Panel had considered Judicial Member Fox's decision to dismiss his unconscionable conduct claim, and had upheld that decision. I suggested that his remedy, if he were dissatisfied with that decision, lay in an appeal, not back with the Tribunal at first instance.
I indicated to Mr Trowbridge I was considering dismissing his present application on the ground that it sought to re-litigate matters already determined and, as result, was misconceived and lacking in substance.
Mr Trowbridge responded that he had never been given the opportunity to argue that his notice of eviction was invalid, and that he was not in arrears, so as to justify the issue of such a notice. Mr Laybutt took issue with this saying the issue of the notice to quit had been comprehensively traversed before the Tribunal, as had the rental arrears issue. Mr Laybutt also said that the issues had been raised before the Appeal Panel: Mr Trowbridge agreed with this.
I put to Mr Trowbridge that the purpose of his present application was to re-litigate matters that had been previously considered by coming "through the back door," rather than by exercising his further appeal rights. He said-
"...there is some degree of truth to that, but the back door thing would be because there was a mistrial in the first place and because I never got to present any evidence at all...
Mr Trowbridge said Judicial Member Fox did not give him a fair chance to demonstrate the validity of his unconscionable conduct claim. He had a real grievance with respect to the decision to strike out his unconscionable conduct claim.
In response to a series of questions from me Mr Laybutt advised that Mrs Morris died in September 2010. He understood that her solicitor is the executor of her estate. Con Morris is her son.
I asked Mr Trowbridge to tell me why he had made the application naming a deceased person, her agent, and a person (Con Morris) who was not his landlord, as defendants.
Mr Trowbridge replied that Con Morris had power of attorney for his mother while she was alive. As her attorney he had acted as landlord and done "unethical things.' He had held himself out as the owner of the property.
Mr Trowbridge agreed that Mrs Morris is deceased.
He said that he was able to sue Mr Laybutt personally as Mr Laybutt had been a recipient of a costs order and had lied under oath "dozens of times." Mr Laybutt, he said, had "intentionally deceived the Tribunal." I pointed out to Mr Trowbridge that this was an unconscionable conduct claim and that Mr Laybutt and Mr Morris were neither the lessor nor the lessee. He nonetheless sought to maintain his claim against Mr Laybutt.
Conclusion
There can be no doubt that in bringing his present claim Mr Trowbridge is seeking to re-litigate - as he himself admitted - matters that have already been determined by the Tribunal at first instance and on appeal. In Blair v Curran (1939) 62 CLR 464 at 531-532, Dixon J discussed the principles of issue estoppel and res judicata -
"A judicial determination directly involving an issue of fact or of law disposes once and for all of the issue, so that it cannot afterwards be raised between the same parties or their privies. The estoppel covers only those matters which the prior judgment, decree or order necessarily established as the legal foundation or justification of its conclusion, whether that conclusion is that a money sum be recovered or that the doing of an act be commanded or be restrained or that rights be declared. The distinction between res judicata and issue-estoppel is that in the first the very right or cause of action claimed or put in suit has in the former proceedings passed into judgment, so that it is merged and has no longer an independent existence, while in the second, for the purpose of some other claim or cause of action, a state of fact or law is alleged or denied the existence of which is a matter necessarily decided by the prior judgment, decree or order.
Nothing but what is legally indispensable to the conclusion is thus
finally closed or precluded. In matters of fact the issue-estoppel is
confined to those ultimate facts which form the ingredients in the cause of action, that is, the title to the right established. Where the conclusion is against the existence of a right or claim which in point of law depends upon a number of ingredients or ultimate facts the absence of any one of which would be enough to defeat the claim, the estoppel covers only the actual ground upon which the existence of the right was negatived. But in neither case is the estoppel confined to the final legal conclusion expressed in the judgment, decree or order. In the phraseology of Coleridge J in R v
Inhabitants of the township of Hartington Middle Quarter (1855) 4 E & B
780 at 794 [119 ER 288 at 293], the judicial determination concludes, not merely as to the point actually decided, but as to a matter which it was necessary to decide and which was actually decided as the groundwork of the decision itself, though not then directly the point at issue. Matters cardinal to the latter claim or contention cannot be raised if to raise them is necessarily to assert that the former decision was erroneous."
In my view the doctrine of res judicata prevents Mr Trowbridge again litigating these matters with Mrs Morris or her privies: Mr Laybutt (her agent) and Mr Con Morris (who Mr Trowbridge alleges was at the relevant times Mrs Morris's attorney and agent).
Further, while Mr Trowbridge asserted that his present application raised new issues not previously determined, I am satisfied this is not the case. Each matter he directed me to as being "new" was considered in the earlier litigation.
I would add that, were I wrong in this, I consider that Mr Trowbridge would, nonetheless, be precluded from raising the new matters because they are matter that he could, and should reasonably, have raised in the earlier proceedings - an Anshun Estoppel: Port of Melbourne Authority v Anshun Pty Ltd (1981) 147 CLR 589.
Those matters which have already been heard and determined as between himself and Mrs Morris are res judicata and cannot be litigated again. Further, insofar, as Mr Trowbridge now seeks to agitate as against Mr Laybutt and Mr Con Morris, matters which have already been decided in his litigation against Mrs Morris, his attempt to do so is an abuse of process. If Mr Trowbridge was dissatisfied with the decision of the Appeal Panel then his remedy was to appeal that decision, not to attempt to re-litigate matters already determined. His attempt to do so is without merit and misconceived.
While Mr Trowbridge did argue that in his present claim he was seeking to raise the issue of the validity of the notice, which he said had not been previously determined, the decision of the Tribunal at first instance and on appeal point to a contrary conclusion. He agreed that he had sought to agitate the issue of the validity of the notice before the Appeal Panel. I am satisfied that the matters he seeks to raise have already been heard and determined.
Additionally, there is little doubt, in any case, that Mr Trowbridge's unconscionable conduct claim is unsustainable. Section 71A of the RL Act provides that -
A lessor or lessee, or former lessor or lessee, under a retail shop lease or former retail shop lease may lodge an unconscionable conduct claim with the Tribunal for determination of the claim.
Section 62B relevantly provides -
(1) A lessor must not, in connection with a retail shop lease, engage in conduct that is, in all the circumstances, unconscionable.
(2) ...
(3) Without in any way limiting the matters to which the Tribunal may have regard for the purpose of determining whether a lessor has contravened subsection (1) in connection with a retail shop lease, the Tribunal may have regard to:
(a) the relative strengths of the bargaining positions of the lessor and the lessee, and
(b) whether, as a result of conduct engaged in by the lessor, the lessee was required to comply with conditions that were not reasonably necessary for the protection of the legitimate interests of the lessor, and
(c) whether the lessee was able to understand any documents relating to the lease, and
(d) whether any undue influence or pressure was exerted on, or any unfair tactics were used against, the lessee or a person acting on behalf of the lessee by the lessor or a person acting on behalf of the lessor in relation to the lease, and
(e) the amount for which, and the circumstances under which, the lessee could have acquired an identical or equivalent lease from a person other than the lessor, and
(f) the extent to which the lessor's conduct towards the lessee was consistent with the lessor's conduct in similar transactions between the lessor and other like lessees, and
(g) the requirements of any applicable industry code, and
(h) the requirements of any other industry code, if the lessee acted on the reasonable belief that the lessor would comply with that code, and
(i) the extent to which the lessor unreasonably failed to disclose to the lessee:
(i) any intended conduct of the lessor that might affect the interests of the lessee, and
(ii) any risks to the lessee arising from the lessor's intended conduct (being risks that the lessor should have foreseen would not be apparent to the lessee), and
(j) the extent to which the lessor was willing to negotiate the terms and conditions of any lease with the lessee, and
(k) the extent to which the lessor and the lessee acted in good faith.
(4) ...
(5) A person is not to be taken for the purposes of this section to engage in unconscionable conduct in connection with a retail shop lease by reason only that the first-mentioned person institutes legal proceedings in relation to that lease or refers to arbitration a dispute or claim in relation to that lease.
(6) A person is not to be taken for the purposes of this section to engage in unconscionable conduct in connection with a retail shop lease by reason only that the first-mentioned person fails to renew the lease or issue a new lease.
(7) For the purpose of determining whether a lessor has contravened subsection (1) or whether a lessee has contravened subsection (2):
(a) the Tribunal must not have regard to any circumstances that were not reasonably foreseeable at the time of the alleged contravention, and
(b) the Tribunal may have regard to circumstances existing before the commencement of this section but not to conduct engaged in before that commencement.
(8) A lessor or lessee, or former lessor or lessee, who suffers loss or damage by reason of unconscionable conduct of another person that is in contravention of this section may recover the amount of the loss or damage by lodging a claim against the other person under section 71A.
(9) If the matter of such loss or damage arises in connection with a matter the subject of proceedings in the Tribunal, the Tribunal may proceed to decide it, and in so doing may award such sum as it thinks fit.
(10) In this section:
lessee or former lessee includes a person who is a guarantor or covenantor under a lease or former lease.
For conduct to be found to be unconscionable it must involve a high level of moral obloquy to ground an unconscionable conduct claim: Attorney-General of NSW v Worldbest Holdings Ltd (2005) NSWLR 557.
The first ground of unconscionable conduct alleged by Mr Trowbridge, " Violations of the ethical guidelines of the Real Estate Institute of NSW," is directed at Mr Laybutt. Assuming, for the sake of argument, that an unconscionable conduct claim could be maintained against Mr Laybutt as agent for the lessor (an issue that is by no means clear), the conduct alleged does not have the high level of moral obliquity necessary to constitute unconscionable conduct. That conduct consists of refusing to meet or settle a demand for rent relief of $271, and issuing a notice to quit for arrears of rent (which were subsequently found to be owing).
The second ground of unconscionable conduct alleged by Mr Trowbridge is simply a regurgitation of the claims Mr Trowbridge made concerning losses caused by the flooding of the premises, and with respect to the his purported exercise of an option, which the Tribunal found had not been validly exercised (see paragraph 3 of Trowbridge v Morris [2010] NSWADT 18). The particulars Mr Trowbridge supplied are argumentative at best, and the conduct alleged does not have the high level of moral obliquity necessary to constitute unconscionable conduct.
The third ground of unconscionable conduct relied on by Mr Trowbridge relates to conduct in earlier Tribunal hearings. It is in essence an attempt to caval with the findings of the Tribunal, combined with allegations of improper conduct by the respondents in the course of that litigation. The improper conduct alleged is with respect to litigation, not in connection with a retail shop lease. While the words "in connection with" in s 62B are wide (see Taylor Farms (Aust) Pty Ltd v A Calkos Pty Ltd & Ord [1999] NSWSC 186 at [36]) , in the context of the RL Act they cannot be stretched to include conduct in litigation relating to a former retail shop lease. As I have already indicated, if Mr Trowbridge was dissatisfied with the result of his appeal, he had a remedy. His attempt to re-litigate those matters, and to question the earlier findings of the Tribunal, in the present unconscionable conduct claim is an abuse of process.
Additionally, I considered that there were a number of other factors that point to Mr Trowbridge new application being misconceived. These included the fact that Mr Trowbridge had named a deceased person as a respondent - as a opposed to the legal personal representative of her estate - and two person who had acted as her disclosed agents, without in any way disclosing how or why liability should attach to them personally. While I appreciate that Mr Trowbridge is not legally qualified, these are fundamental matters in civil litigation. There were also significant issues concerning whether or not part or all of his unconscionable conduct claim is outside the time limits for making a claim found un s 71B(2) of the RL Act, but, given that the issues had been previously decided, I did not consider it necessary to determine them.
Ultimately, I concluded that Mr Trowbridge present application was without merit. It lacked substance, was misconceived, and was a frivolous attempt to re-litigate issues already determined.
S 73(5)(g)(ii) of the ADT Act provides -
(5) The Tribunal:
(a) ...
(g) may dismiss at any stage any proceedings before it in any of the following circumstances:
(i) .
(ii) if the Tribunal considers that the proceedings are frivolous or vexatious or otherwise misconceived or lacking in substance,
Relying on that power I dismissed Mr Trowbridge's application.
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Decision last updated: 30 August 2011
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