Wang v Abdel-Messih;; Abdel-Messih v Wang

Case •

[2017] NSWCATCD 70

•

25 August 2017

No judgment structure available for this case.

Civil and Administrative Tribunal


New South Wales

Medium Neutral Citation: Wang v Abdel-Messih;; Abdel-Messih v Wang [2017] NSWCATCD 70
Hearing dates:21 July 2017
Decision date: 25 August 2017
Jurisdiction:Consumer and Commercial Division
Before: P French, General Member
Decision:

In RT 17/14436 and RT 17/19334 (the landlord’s applications)

Consent orders made on 21 July 2017

1. By consent, the Residential Tenancy Agreement is terminated immediately and possession is given to the landlord on the date of termination.
2. By consent, the order for possession is suspended to 25 July 2017.
3. By consent, the tenant is to pay the landlord an occupation fee at the rate of $154.29 per day from the day after the date of termination, namely 22 July 2017 until the date vacant possession is given to the landlord.
4. By consent, within 60 days of the date for possession of the premises specified in these orders, the landlord may request the relisting of these applications to determine the amount of the occupation fee owing.

NOTATION made on 21 July 2017

The Tribunal notes that the parties have also agreed that the landlord and the landlord’s Managing Agent will not list the tenant on any residential tenancy data base.

Order made by determination on 11 August 2017

5. The tenant, Bishoy Abdel-Messih, Unit 5605/93 Liverpool Street Sydney 2000 NSW Australia is to pay the landlord, Le Dong Wang, c/- Yueh Ying Chiu trading as Property Square Realty Suite 1 Level 7 377-383 Sussex Street Sydney 2000 NSW Australia the sum of $15,000.00 immediately.
In matter number RT 17/16177 (the tenant’s application)

Order made by determination on 26 July 2017

6. The tenant’s request for leave to file additional evidence and or submissions after the conclusion of the final hearing of this application is refused.

Order made by determination on 11 August 2017

7. The application is dismissed.

Catchwords: RESIDENTIAL TENANCIES – landlord’s application under section 87 of the Residential Tenancies Act 2010 for a termination order for breach of the residential tenancy agreement – keeping of a dog at the residential premises – landlord’s application under section 87 of the Residential Tenancies Act 2010 for a termination order for breach of the residential tenancy agreement – non-payment of rent in accordance with the residential tenancy agreement – tenant’s application under sections 75(2), 187 and 190 of the Residential Tenancies Act 2010 for compensation for damage and loss allegedly incurred as a result of the landlord’s alleged breach of the residential tenancy agreement in unreasonably withholding consent to the sub-letting of the residential premises
Category:Principal judgment
Parties: Le Dong Wang (applicant/cross respondent-landlord)
Bishoy Abdel-Messih (respondent/cross applicant - tenant)
Representation: Bishoy Abdel-Messih in person
Susan Chiu, Managing Agent for Landlord Le Dong Wang
File Number(s):RT 17/ 14436; RT 17/16177; RT 17/19334
Publication restriction:Nil

REASONS FOR DECISIOn

  1. There are three applications before the Tribunal in these proceedings.

  2. The first application in time (RT 17/14436) is an application made by Le Dong Wang (the landlord) under section 87 of the Residential Tenancies Act 2010 (RT Act) for an order that would terminate a residential tenancy agreement (RTA) between him and Bishoy Abdel-Messih (the tenant) on the ground that the tenant has breached the RTA by keeping a pet dog at the residential premises, and for consequential orders. This application was made to the Tribunal on 28 March 2017 (the landlord’s first application).

  3. The second application in time (RT 17/16177) is an application by the tenant for an order under s75(5) of the RT Act that would sub-let the residential premises to an unspecified person or persons; an order under section 111 of the RT that would declare that a termination notice served on him on behalf of the landlord was not given in accordance with the RT Act; an order under section 115 of the RT Act that would declare that a termination notice served on him on behalf of the landlord is of no effect because it is retaliatory; and, an order under section 190 and sub-section 187(1)(d) of the RT Act that would compensate him for damage and loss he alleges he has incurred as a result of the landlord’s breach of his obligation under sub-section 75(2) of the RT Act by unreasonably withholding consent to the sub-letting of the residential premises. This application was made to the Tribunal on 6 April 2017 (the tenant’s application).

  4. The third application in time (RT 17/19334) is an application by the landlord under section 87 of the RT Act that would terminate the RTA that subsists between him and the tenant on the ground that the tenant has breached the RTA by failing to pay rent in accordance with that agreement, and for consequential and related orders. This application was made to the Tribunal on 28 April 2017 (the landlord’s second application).

Consent orders

  1. By the time these applications came before the Tribunal for final hearing on 21 July 2017 the parties had reached an agreement to terminate the residential tenancy agreement. Proposed consent orders were signed and submitted in relation to this aspect of the dispute at the commencement of the hearing.

  2. The Tribunal has the power to make orders by consent to give effect to an agreement reached to settle a dispute where it is satisfied it has the power to make a decision in the terms of the agreed settlement or in terms that are consistent with the terms of the agreed settlement, and where the agreement is in writing and signed on behalf of the parties (section 55 of the Civil and Administrative Tribunal Act 2013 (NCAT Act)).

  3. In these respects, I was satisfied that I had the power to: make an order for termination of the residential tenancy agreement based upon an agreement between the parties as to the termination of the tenancy (sub-sections 81(3) and 81(4)(d) of the RT Act); to suspend the order for possession (sub-section 114(1) of the RT Act); to order the payment of an occupation fee until vacant possession was given (sub-section 114(2) of the RT Act); and, to order the relisting of the application in future, if necessary, to enable the calculation of any occupation fees that may be owed (sub-section 188(c) of the RT Act). I therefore made those proposed orders by consent.

  4. The parties also proposed that I make an order by consent that would prevent the landlord and the landlord’s Managing Agent from listing the tenant on a residential tenancy database. The Tribunal’s powers in relation to residential tenancy databases are set out in section 217 of the RT Act. That section does not give the Tribunal the power to order a landlord not to list a tenant on a residential tenancy data base. As I do not have power to make such a decision, I am unable to make such an order by consent. Having explained this to the parties, they were content for me to notate this additional agreement between them without making any order.

Disposition of the remaining issues

  1. The consent agreement between the parties left two issues for determination by the Tribunal: the rent arrears owed by the tenant to the landlord up to the date of termination of the residential tenancy agreement, being 21 July 2017, and the tenant’s claim for compensation in the amount of $15,390.85 for damage and loss allegedly arising from the landlord’s unreasonable withholding of consent to the sub-letting of the residential premises.

  2. In relation to the first issue, the Tribunal was satisfied on the evidence before it that as at the date of the hearing, being 21 July 2017, the tenant owed the landlord rent for 101 days from 11 April 2017 in the amount of $15,536.29. The landlord is therefore entitled to an order from the Tribunal pursuant to sub-sections 33(1), 190(1) and 187(1)(a) of the RT Act that will require the tenant to pay him $15,000.00 in respect of these arrears immediately. The landlord cannot obtain an order for the payment of the whole amount of the arrears owed because of the operation of sub-section 187(4)(a) and Regulation 23(b) of the RT Act, which impose a monetary limit of $15,000.00 on the Tribunal’s order making power, other than in respect of a rental bond.

  3. In relation to the second issue, the Tribunal was not satisfied on the evidence before it that the landlord had acted unreasonably in withholding consent to the sub-letting of the residential premises. The tenant has thus not succeeded in establishing a breach of the RTA by the landlord that could give rise to an order for compensation. The tenant’s application has therefore been dismissed.

Background

  1. The dispute arises from a RTA that was made and which commenced on 18 August 2016. It was a fixed term agreement of 12 months duration. The agreement is in standard form. The rent payable under the RTA was $2,160.00 per fortnight, payable in advance. The RTA specifies that the maximum number of occupants that may reside at the premises is four persons. I am satisfied that the agreement is a residential tenancy agreement within the meaning of section 13 of the RT Act, to which that Act applies pursuant to section 6 of that Act.

  2. The residential premises is a two-bedroom, partly furnished apartment with an enclosed balcony and one car space located in the World Tower Building on Liverpool Street in Central Sydney.

  3. The residential premises is a Lot is a Strata Scheme governed by By-Laws that bind owners and occupiers of Lots in the Scheme. At least five By-Laws of the Scheme are of significance in this proceeding:

14.1 Special By-Law 20.5 requires the owner or existing occupier of a Lot to notify the Owners Corporation of any lease of a Lot within 14 days of that lease being granted for the purpose of entering that person on the Strata Roll. This notification must include the name of the occupier, the date of commencement of their occupation, and the term of their occupation;

14.2 Special By-Law 20.8 prohibits overuse and overcrowding of premises (and by extension of the common property). It does so by stipulating that the number of unrelated persons who may sleep in a Lot overnight is limited to two persons for each bedroom in the Lot;

14.3 Special By-Law 20.13 stipulates that an owner must not permit the use of a Lot for temporary accommodation without first obtaining development consent from the City of Sydney. Temporary accommodation is defined to mean a period of occupation of less than two months or the use of premises for accommodation for tourists and travellers whose principal place of residence is elsewhere;

14.4 Special By-Law 20.19 stipulates that the owner of a Lot shall be liable for the actions of any occupier of a Lot and is responsible for ensuring compliance with that occupier with the By-Laws for the Strata Scheme. It also stipulates that an owner of a Lot is liable for any costs incurred by the Owners Corporation in rectifying any damage to the common property caused by an occupier or in enforcing an occupier’s compliance with the Strata Scheme’s By-Laws; and

14.5 Special By-Law 31 restricts access to the common property (and as a consequence, access to the building) to owners and occupiers recorded on the Strata Roll. It does so by stipulating that an Access Key will only be issued to a person who is entered on the Strata Roll. In this respect, an owner of a Lot must apply in writing to the Owners Corporation to be issued with an Access Key, inform the Owners Corporation of the details of any occupier of the Lot who is at any time in possession of an Access Key, and ensure that an occupier who vacates the Lot returns the Access Key.

  1. Virtually since the commencement of the tenancy the parties have been in dispute over various matters which has resulted in extensive litigation in this Tribunal (RT 16/42344; RT 16/44922; RT 16/39468 reported in Wang v Abdel-Messih; Wang v Adel-Messih; Abdel-Messih v Wang [2017] NSWACTCD 11; RT 17/04077 (unreported); and, RT 16/44922 (unreported)). The tenant has also been in dispute with various of his sub-tenants, which has also resulted in some litigation in this Tribunal (RT/48675 (unreported); Abdel-Messih v Marshall [2017] NSWCATAP 136).

  2. The sub-letting of the premises was one aspect of the dispute in Wang v Abdel-Messih; Wang v Adel-Messih; Abdel-Messih v Wang [2017] NSWACTCD 11. In that case, the Tribunal, differently constituted, found that there had been an attempt by the landlord, on entering into the RTA, to avoid the operation of sub-section 75(2) of the RT Act by modifying clause 32.2 of the agreement so as to exclude the possibility of sub-letting. However, the Tribunal also found that the landlord had later consented to sub-letting. The tenant’s claim that the landlord had breached clause 32.3 of the RTA by unreasonably refusing to consent to sub-letting therefore failed and no entitlement to compensation for this alleged breach was established.

  3. The tenant leases a number of other premises in residential towers in the Sydney Central Business District. These arrangements have the character of an accommodation enterprise (or business). The tenant sub-lets each of these premises to unrelated persons (typically travellers and students on short-term visas) for a total rent that exceeds the rent he pays under his head-tenancy (assuming full occupancy). The tenant has frequently fallen into disputes with his landlords and sub-tenants, resulting in extensive litigation in this Tribunal. There are a number of reported decisions of the Tribunal arising from these proceedings, which are publicly available: Abdel-Messih v Field [2016] NSWCATAP 95; Abdel-Messih v Lobo [2016] NSWCATAP 143; Abdel-Messih v Mao [2016] NSWCATAP 223; Abdel-Messih v Dai [2017] NSWCATAP 20; Abdel-Messih v Dai [2017] NSWCATAP 76; Abdel-Messih v Azzi [2017] NSWCATAP 56; Abdel-Messih v Azzi [2017] NSWCATAP 86; Diago-Lobo v Abdel-Messih [2016] NSWCATCD 14; Abdel-Messih v Mahfoudi & Rouanet [2017] NSWACACD 10.

Procedural history

  1. The landlord’s first application was first listed before me for Conciliation and Hearing in a Group List on 14 April 2017. The tenant attended that listing of the Application in person. The landlord’s Managing Agent, Ms Susan Chui, attended that listing on behalf of the landlord. In accordance with the Tribunal’s usual practice where both parties are present, prior to the case being called, the parties were provided with an opportunity to attempt to resolve the dispute in conciliation with the assistance of a Tribunal conciliator. Those efforts were not successful.

  2. When the parties returned to the hearing room they both pressed the Tribunal to hear and determine the Application at its first listing. They both contended that they had all of the documentary evidence that they intended to rely upon with them and that this had been exchanged. The Tribunal warned the parties about the time constraints that applied to hearings conducted in a Group List. Both parties expressed the view that they would be able to present their case within these time constraints. Against this background, the Tribunal embarked on a hearing, which extended for approximately 1 hour. This was all the time available before the commencement of the next list.

  3. It emerged in the course of the hearing that, in fact, neither party was in a position to complete their evidence in the time available. Just prior to the available time running out, the tenant sought to tender and speak to a large folder of additional documents he claimed were relevant to his response to the application. There was no time left available for him to do so.

  4. Additionally, despite Ms Chui having told the Tribunal she had all of the evidence she intended to rely upon with her, it emerged that she placed particular reliance on recent video surveillance tapes of the common property maintained by the Building Manager to disprove the tenant’s assertion that his pet dog had been removed in February 2017 and that his breach of the RTA in this respect had been remedied. She had failed to attend the Tribunal with those tapes or any still images from those tapes. This evidence was potentially of some significance to the outcome of the Application, not the least because the tenant had repeatedly asserted to the Tribunal in the course of the hearing, while under a promise to tell the truth, that the dog had been removed in February 2017. I therefore had no alternative but to adjourn the matter part-heard and give directions for the parties to file and serve their additional evidence.

  5. The tenant’s application first came before the Tribunal, differently constituted, in a Group List for Conciliation and Hearing on 24 April 2017. The matters agitated in that application could not be resolved at that listing. The Tribunal set the Application down for hearing and directed that it be heard together with the landlord’s first application. Directions were given for the filing and service of evidence in relation to that application.

  6. The landlord’s second application was first listed before the Tribunal on 13 June 2017. Prior to that hearing, on 22 May 2017, the tenant contacted the Registrar requesting that this application be listed together for hearing with the landlord’s first application and the tenant’s application. In support of that request the tenant stated: “[t]hese applications are inter-related, and should be heard together to ensure efficacy and clarity for the decision-maker. For e.g. rent owing is an amount equal to the compensation claimed. Consequently, awarding the compensation claim would nullify the termination for rent.” That request was referred to the Tribunal, differently constituted, in chambers, as an adjournment request. The Member granted the adjournment and directed that the application be listed with the related matters for hearing. She does not state her reason for this decision.

  7. The applications came before me for hearing on 21 July 2017. They were set down for a two hour hearing commencing at 10:15am. The hearing commenced on time and continued uninterrupted until 2:00pm, a period of 3:45 hours. Approximately 45mins was spent finalising the consent orders, and clarifying the rent arrears owed by the tenant. The remainder of the hearing was devoted to the hearing of the tenant’s compensation claim. Each party had at least 1 hour to present their case to the Tribunal. This included the opportunity for both parties to outline their evidence in chief and make submissions, to question each other and the tenant’s witness, and an opportunity limited to 10minutes for the tenant to reply to the landlord’s evidence and submissions. At the end of the hearing I reserved my decision other than in relation to the orders made by consent based upon the agreement of the parties.

  8. No application was made by either party in the course of the hearing conducted on 21 July 2017 for leave to file additional evidence or submissions after the hearing, and none was granted. On 24 July 2017, the tenant wrote to the Tribunal to complain that he had not had enough time to reply to the landlord’s evidence and submissions. In particular, he complained that he had only received one bundle of the landlord’s evidence the day before the hearing and that he had not had a proper opportunity to deal with it prior to the hearing. He requested leave to file additional evidence submissions by 26 July 2017 to cover “gaps” in the reply he made to the landlord’s evidence on 21 July 2016. The Registrar referred that request to me in chambers on 26 July 2017 and I made an order refusing it. In spite of that order, the tenant filed additional evidence and submissions on 26 July 2017. I have not considered that material.

  9. I now give my reasons for refusing leave to the tenant to file this additional material.

  10. The starting point is found in sub-section 38(5)(c) of the NCAT Act, which requires the Tribunal to take such measures as are reasonably practicable to ensure that parties have a reasonable opportunity to be heard or otherwise have their submissions considered in the proceedings. That obligation must acquitted having regard to the guiding principle to be applied in all aspects of the Tribunal’s practice and procedure which is contained in section 36 of the NCAT Act. The Tribunal is to facilitate the just, quick and cheap resolution of the real issues in the proceedings. The parties to proceedings have a duty to cooperate with the Tribunal in its efforts to give effect to the guiding principle (sub-section 36(3)(a) of the NCAT Act).

  1. The Tribunal’s practice and procedure should also be implemented so as to facilitate the resolution of the issues between the parties in such a way that the cost to the parties and the Tribunal is proportionate to the importance and complexity of the subject matter of the proceedings (sub-section 36(4) of the NCAT Act). In this respect, sub-section 38(6)(c) of the NCAT Act also provides that, in the case of a hearing, the Tribunal may require the presentation of the respective cases of the parties before it to be limited to the periods of time that it determines are reasonably necessary for the fair and adequate presentation of the cases.

  2. In this instance, I am satisfied that the parties had a reasonable opportunity to be heard and have their submissions considered without the need for any further material to be filed after the hearing. Together the parties have filed and served over 1000pages of documentary evidence. They had the opportunity to present their cases at a formal hearing, to question each other, and the tenant’s witness. That hearing extended to almost twice the allocated time.

  3. It is true that both parties failed to comply with the Tribunal’s directions for the filing and service of evidence, in that they each filed additional evidence outside the time frames stipulated, and that they handed up additional material in the course of the hearing. I allowed all of that material to be put before the Tribunal in the absence of any objection by either party, and in circumstances were both parties were delinquent, so as to allow both parties to fully ventilate their claims and counter-claims. I am satisfied that neither party was taken by surprise by any of the material filed and served late, or handed-up in the course of the hearing, and that each party had a reasonable opportunity to deal with this additional material in the course of the hearing. No issue of procedural fairness arises in these circumstances in my view.

  4. The Tribunal’s obligation under sub-section 38(5)(c) to ensure the parties have a reasonable opportunity to be heard does not require it to provide a party with a limitless opportunity to place material before the Tribunal. The Tribunal must case manage proceedings so as to ensure they are brought to finality justly, and as quickly and cheaply as circumstances reasonably allow. It must ensure that the public cost, and the cost to the parties, of bringing proceedings to finality is proportionate to the subject matter and complexity of the claim: Wall v Barham [2017] NSWACTAP 61 at [31]; Mesiha v Murrell [2017] NSWCATAP 1 at [29 -60]. In this case, permitting the tenant to file additional material after the hearing would have caused further delay in bringing proceedings to finality. Procedural fairness would have required the Tribunal to direct that this material be served on the landlord and that the landlord be given the opportunity to make any reply. This course would also have added to the public and party/party costs of the proceedings.

  5. It is settled law that the filing of written submissions, let alone evidence, after the conclusion of oral argument is not permitted without leave. The time for argument to be made is at the hearing of the application: Carr v Finance Corporation of Australia Ltd [No 1] (1981) 147 CLR 246 at [248] per Mason J. Parties have no legal right to be heard further after the conclusion of the hearing: Eastman v Director of Public Prosecutions of the Australian Capital Territory (2003) 214 CLR 318. Leave to file further submissions after the conclusion of oral argument will be granted only in exceptional circumstances: Re Application by the Chief Commissioner of Police (Vic) [2005] HCA 18. These principles have been applied repeatedly in this Tribunal, including in earlier proceedings brought by the tenant: Abdel-Messih v Azzi [2017] NSWCATAP 56 at [64 to 65]; Abdel-Messih v Lobo [2016] NSWCATAP 143 at [69 to 71].

  6. In this case, I am satisfied that there are no exceptional circumstances that would warrant a grant of leave to the tenant to file submissions and evidence after the conclusion of the oral hearing.

Evidence

  1. Both parties have filed and served extensive documentary evidence in relation to each application exceeding more than 1000pages. This includes additional documentary evidence filed after the dates specified for the filing and service of evidence. At the commencement of the hearing, both parties sought to hand up additional documents. The tenant also sought to hand up a witness statement made by Mr Rudy Widjaja, and to call him as witness at the hearing. There was no objection by either party to the Tribunal receiving the additional evidence sought to be tendered by the other party. Ms Chui also did not object to Mr Widjaja’s witness statement or to him being called as a witness. Although the late submission and tender of this additional documentary evidence and the late calling of Mr Widjaja as a witness was less than satisfactory from a procedural point of view, I allowed it in order to ensure that the parties had the opportunity to full ventilate their cases.

  2. The landlord’s Managing Agent, Susan Chiu, and Mr Abdel-Messih both gave oral evidence at the hearing and each was subject to questioning by the other. As noted, Mr Abdel-Messih also called Mr Rudy Widjaja, one of his sub-tenants, as a witness. Mr Widjaja was questioned by Mr Abdel-Messih and Ms Chiu.

Material facts

  1. The material facts to emerge from the evidence, as they relate to the remaining issues in dispute between the parties, may be stated as follows:

Landlord’s applications

36.1   As at the date of the hearing, being 21 July 2017, the tenant had not paid rent due from 11 April 2017, being a period of 101 days. This basic fact was not in dispute between the parties, and was objectively ascertainable from the Managing Agent’s rent ledger.

36.2   There was a minor dispute between the parties as to what the actual amount of rent owed was, which appeared to relate to a part-day payment for which the tenant was in credit. This dispute could not be resolved on the evidence. However, Ms Chui ultimately submitted that the tenant owed $15,536.29 for this period. As this amount was less than the amount the tenant had contended as owing, the Tribunal rested on this figure.

Tenant’s application

36.3   At the material time for this dispute, the tenant occupied what he refers to as “bedroom 1” of the premises. He sought to sub-let what he refers to as “bedroom 2” and the enclosed balcony of the premises, which he refers to as “bedroom 3”. The sub-lease would confer exclusive occupation of the bedroom on the sub-tenant and shared use of the kitchen, lounge/dining and bathroom. The sub-tenant would also have access to the common property of the Strata Scheme as an occupier of a Lot in that Scheme.

36.4   At the commencement of the tenancy, the tenant did not personally occupy the premises. It appears that he moved in sometime during the period 12 October to 9 November 2016: Wang v Abdel-Messih; Wang v Adel-Messih; Abdel-Messih v Wang [2017] NSWACTCD 11 at 31.

36.5   On 24 August 2016 the tenant entered into a fixed term RTA of three months duration with Mr Simon Marshall in relation to bedroom 2 of the premises. Mr Marshall was required to pay rent at the rate of $800.00 per fortnight under that agreement. This sub-tenancy ended in dispute before the end of the fixed term on 5 November 2016, when Mr Marshall vacated. The early termination of the RTA gave rise to proceedings in this Tribunal: RT 16/48675; Abdel-Messih v Marshall [2017] NSWCATAP 136.

36.6   In Wang v Abdel-Messih; Wang v Adel-Messih; Abdel-Messih v Wang [2017] NSWACTCD 11 the tenant unsuccessfully sought to argue that the landlord’s Managing Agent had somehow “interfered” with Mr Marshall’s sub-tenancy causing Mr Marshall to terminate it before the end of the fixed term. A claim for compensation from the landlord for this alleged interference failed [a 69].

36.7   Prior to entering into the RTA with Mr Marshall, on 23 August 2016, the tenant applied to the landlord's Managing Agent for approval for Mr Marshall to occupy the premises which was given on that day. It appears that the landlord’s Managing Agent did not at that time apprehend that the tenant proposed to sub-let bedroom 2 of the premises to Mr Marshall.

36.8   On 24 August 2016, either the tenant or Mr Marshall showed his fixed term RTA to the Strata Scheme’s Building Manager. This resulted in the Building Manager contacting the landlord’s Managing Agent to notify her of that fact. In response, the Managing Agent arranged to meet the tenant later that day at which time she served him with notice of termination of the head RTA on the ground that he had breached the agreement by sub-letting. These events gave rise to the proceedings reported in Wang v Abdel-Messih; Wang v Adel-Messih; Abdel-Messih v Wang [2017] NSWACTCD 11.

36.9   On 29 August 2016, the tenant notified the landlord’s Managing Agent that he intended that Ms Khurshid and Ms Goel would occupy the premises in bedroom 1. The Managing Agent asked the tenant to supply some background information about them in order to determine if their occupancy would be approved. The tenant provided some, but not all, of this information with the result that the landlord’s consent to their occupation was never given.

36.10   However, the tenant arranged for Ms Khurshid and Ms Goel to move into the premises without the landlord’s consent. Without the consent of the landlord to their occupation the tenant was unable of obtain Access Keys for Ms Khurshid and Ms Goel to gain entry to the building. This meant that he or Mr Marshall had to be available whenever they wanted to do so. This arrangement led to a dispute between the tenant and Ms Khursid and Ms Goel which resulted in them vacating the premises on 16 September 2016.

36.11   In Wang v Abdel-Messih; Wang v Adel-Messih; Abdel-Messih v Wang [2017] NSWACTCD 11 the tenant unsuccessfully sought an order for compensation from the landlord for lost rent in respect of bedroom 1 from 16 September 2016 to 9 November 2016 when he finally moved into that room himself. The claim failed because the Tribunal was not satisfied that the landlord had unreasonably withheld consent to the sub-letting of bedroom 1 to Ms Khursid and Ms Goel [at 64].

36.12   It appears that between 18 August and 7 November 2016 there was no attempt made by the tenant to cause the occupation of the enclosed balcony of the residential premises (“bedroom 3”). In Wang v Abdel-Messih; Wang v Adel-Messih; Abdel-Messih v Wang [2017] NSWACTCD 11 the tenant unsuccessfully sought to claim compensation from the landlord for lost rent for most of this period on the basis that he was unable to let the room because he knew the landlord would refuse permission for him to do so [at 70].

36.13   On 7 November 2016 the tenant applied to the landlord’s Managing Agent to approve the sub-letting of the enclosed balcony to Mr Quan Manh Co. The Managing Agent required the tenant to provide background information about Mr Co in support of this application, and after considering the application, approved it on 16 November 2016. Mr Co moved into the premises under a fixed-term agreement of six months duration on or about that date. However, it appears that the tenant and Mr Co fell into dispute in March 2017 resulting in the tenant issuing Mr Co with a notice of termination of the agreement on 23 March 2017 on the ground that he was not doing his fair share of the cleaning. He vacated the premises on 4 April 2017.

36.14   In early November 2017 the tenant applied to the landlord’s Managing Agent to approve the sub-letting of bedroom 2 to Mr Tian Lan Luan and Ms Jing Yun Lia. After considering that application and its supporting documents, the Managing Agent consented to this sub-lease. The sub-lease was for a period of six months commencing on or about 9 November 2016 and ending on 8 May 2017. However, the tenant fell into dispute with Mr Luan and Ms Lia and issued them with a notice terminating their tenancy on various grounds, including a failure to keep the premises reasonably clean. They vacated the premises on 15 April 2017.

36.15    It appears that when the tenant moved into bedroom 1 on 16 November 2016, or at some time shortly thereafter, he brought with him, or acquired, a puppy which he kept at the premises. It appears that this was brought to the Managing Agent’s attention by the Building Manager and the tenant’s sub-tenants who complained that the puppy was not house trained and urinated and defecated throughout the premises and common property.

36.16   On 8 March 2017 the landlord’s Managing Agent served the tenant notice of termination of the RTA on the ground that the tenant had breached the agreement by keeping a pet dog on the premises contrary to clause 43 which stipulated that no pets were permitted. Pursuant to that notice the tenant was required to deliver vacant possession of the premises to the landlord on 27 March 2017

36.17   Prior to Mr Co giving vacant possession of the enclosed balcony on 4 April 2017, the tenant advertised the availability of the enclosed balcony for let. Mr Alexis Rapp responded to this advertising and it was agreed between him and the tenant that he would move into the premises on 8 April 2017 and stay until the end of the fixed term of the tenant’s head lease, which was 17 August 2017. It also appears to have been agreed that Mr Rapp would pay $700.00 rent per fortnight.

36.18   On 3 April 2017 the tenant applied to the landlord’s Managing Agent for approval for Mr Rapp to occupy the premises. The Managing Agent refused approval on the ground that the tenant had been given notice of the termination of his head lease and that the landlord required him to return possession of the premises.

36.19   On 6 April 2017, the tenant made his application (RT 17/16177) to the Tribunal seeking various orders against the landlord, including an order for compensation arising from the landlord’s alleged unreasonable withholding of consent to his sub-letting of the premises.

36.20   On 14 April 2017 the landlord’s application for termination of the tenancy was listed before the Tribunal for conciliation and hearing. As noted above, the application could not be finalised on that day, and was adjourned part-heard for further hearing.

36.21   On 24 April 2017, the Managing Agent notified the tenant that the landlord had reconsidered his position and would now consider sub-letting proposals provided these subtenancies commenced after the end of the fixed-term of the existing sub-leases (notwithstanding that those sub-leases had already been terminated by the tenant before the end of the fixed term). The landlord’s consent would also be conditional upon the tenant satisfying the Managing Agent that he had informed prospective sub-tenants that the landlord was seeking to recover possession of the premises and had applied to the Tribunal for an order that would terminate the head lease before the end of its fixed term.

36.22   On 28 April 2017 the tenant re-advertised the enclosed balcony for occupation. It appears he did not receive any immediate serious response to this advertising. On or about 28 May 2017, Mr Rudy Widjaja expressed interest in occupation at a proposed rent of $560.00 per fortnight.

36.23   On 29 May 2017 the tenant submitted an application to sub-let the premises to Mr Widjaja to the landlord’s Managing Agent for approval, with a number of supporting documents, including a copy of Mr Widjaja’s passport, and a recent payslip. Later that day the Managing Agent requested the tenant to provide a copy of Mr Widjaja’s visa and to provide documents that would confirm that Mr Widjaja was employed. The tenant provided these additional documents on 31 May 2017.

36.24   The Managing Agent then requested to meet Mr Widjaja on 1 June 2017. In the course of that meeting the Managing Agent informed Mr Widjaja that the landlord was seeking to recover possession of the premises from the tenant and that proceedings were on foot in the Tribunal for a termination order that would terminate the head lease before the end of the fixed term.

36.25   After meeting Mr Widjaja, the Managing Agent notified the tenant that his sub-letting of the premises to Mr Widjaja was approved. Mr Widjaja took up occupancy of the premises on 3 June 2017.

36.26   In early May 2017 the tenant advertised bedroom 2 as available for occupancy. On or about 15 May 2017, Mr Quinn Stoh expressed interest in occupancy at a rent of $900.00 per fortnight. The tenant forwarded an application to the Managing Agent for consent to this subtenancy with some accompanying identification information on 15 May 2017.

36.27   On 16 May 2017 the Managing Agent asked the tenant to submit evidence that he had notified Mr Stoh of the termination proceedings, which the tenant did later that day. On 18 May 2017 the Managing Agent requested from the tenant a copy of Mr Stoh’s visa, passport, evidence of employment, and a copy of a previous rent ledger. The tenant provided a copy of Mr Stoh’s visa and passport later that day. He had already provided evidence of Mr Stoh’s employment. On 19 May 2017 the Managing Agent asked Mr Stoh to attend her office for ‘verification’, which he did.

36.28   Although not entirely clear on the evidence, it then appears that the Managing Agent approved Mr Stoh’s application to sub-lease the premises. He collected an Access Key from the Building Manager’s office on 23 May 2017. However, he returned the Access Card to the Building Manager on 24 May 2017. On 25 May 2017 Mr Stoh sent an email to the Managing Agent to notify her that he had told the tenant and the Building Manager that he would now not be moving into the premises. The Managing Agent sent a return email asking Mr Stoh why, to which he replied “457 nightmare”, apparently indicating that he no longer had authorisation to work in Australia.

36.29   On 16 May 2017, the tenant forwarded to the Managing Agent another application to sub-lease the premises from Ms Mie Raun. No supporting documentation was provided with this application. This resulted in the Managing Agent requesting the tenant to provide a copy of Ms Raun’s passport, visa and a letter confirming her employment status or confirmation of enrolment in a course of study. The tenant did not respond to this request.

36.30   On 22 May 2017, the tenant asked the Managing Agent to supply him with the selection criteria against which his applications for sub-leasing were being considered. The Managing Agent responded to this email on 23 May attaching a document headed “Tenant Selection Criteria” That document states as follows (errors in the original):

“All tenancy applications must accompanied with the following information:

Photographic identification:

Current Driver License OR Passport and visa C.O.E (Confirmation of Enrollment)

Copies of previous rent receipts/Tenancy ledger

Proof of last residential address

Electricity account

Telephone account

Proof of income/payslip/employment letter or bank statement (last 3 months)

On approval of an application to rent a property, all money must be paid in cash, bank cheque or internet transfer.

Property Square Realty reserves the right to alter the above criteria at any time without notice. Should an application fail to meet the above criteria, it may not be processed.”

When Mr Abdel-Messih was questioned by Ms Chui in the course of his oral evidence, he conceded that he had been provided with a copy of the Tenant Selection Criteria when he made his application to lease the premises in August 2016.

Applicable law

  1. A tenant’s obligation to pay rent is set out in section 33 of the RT Act. Sub-section 33(1) provides that a tenant must pay the rent under a residential tenancy agreement on or before the day set out in the agreement. Section 33 is made a term of every residential tenancy agreement by operation of sub-section 33(4) of the RT Act.

  1. Section 26 of the RT Act imposes duties of disclosure on a landlord and a Managing Agent. Pursuant to sub-section 26(1) a landlord or landlord’s agent must not induce a tenant to enter into a residential tenancy agreement by any statement, representation or promise that the landlord or agent knows to be false, misleading or deceptive or by knowingly concealing a material fact of a kind prescribed by the regulations (the matters prescribed by the regulations are not relevant for present purposes). Failure to comply with this obligation is an offence punishable by a maximum penalty of 20 penalty units ($22,000.00).

  2. For the purpose of applying section 26 it is to be noted that the term “landlord” is defined in section 3 of the RT Act to mean, relevantly, “the person who grants the right to occupy residential premises under a residential tenancy agreement” and “a tenant who has granted the right to occupy residential premises to a sub-tenant.” The term “tenant” is defined to mean, relevantly, “the person who has the right to occupy residential premises under a residential tenancy agreement” or “a sub-tenant of a tenant.”

  3. Section 74 of the RT Act deals with the transfer of a tenancy or sub-letting by a tenant. Sub-section 74(1) provides, relevantly, that a tenant may sub-let residential premises if the landlord gives written consent to the sub-letting. Section 74 is made a term of every residential tenancy agreement by operation of sub-section 74(4) of the RT Act.

  4. Section 75 of the RT Act provides in sub-section 75(2) that a landlord must not unreasonably withhold consent to the partial sub-letting of premises which are occupied by the tenant. Sub-section 75(3) sets out certain grounds upon which a landlord may withhold consent to sub-letting, without limiting the bases upon which consent must be withheld. Those grounds are where the number of proposed occupants is more than the number permitted by the RTA or any applicable consent or approval under the Environmental Planning and Assessment Act 1979, where the proposed sub-tenant is listed on a residential tenancy data base in accordance with the RT Act, and where the landlord is reasonably of the opinion that the sub-letting would result in the residential premises being over crowded. Sub-sections 75(2) and 75(3) are made terms of every residential tenancy agreement by operation of sub-section 75(4) of the RT Act.

  5. Sub-section 75(5) of the RT Act provides that if a landlord refuses consent to sub-letting contrary to sub-section 75(2) the tenant may apply to the Tribunal for an order that the tenant may sub-let premises. The Tribunal may make such an order if it is satisfied the landlord’s failure to consent is unreasonable. No time period within which such an application is to be made is specified in the RT Act or RT Regulation. Rule 23 of the Civil and Administrative Tribunal Rules 2014 therefore applies. Pursuant to sub-rule 23(3)(b) such an application must be made within 28 days from the day on which the applicant became entitled to make the application.

  6. Section 190 of the RT Act provides that a landlord or a tenant may apply to the Tribunal for an order in relation to a breach of a residential tenancy agreement within the period prescribed by the regulations after the landlord or tenant becomes aware of the breach or within such other period as may be prescribed by the regulation. Regulation 22(9) of the Residential Tenancies Regulation 2010 prescribes this period as within three months of the applicant becoming aware of the breach.

  7. Section 187 of the RT Act sets out order making powers of the Tribunal. Relevantly to these proceedings the Tribunal has the power to order the payment of money (sub-section 187(1)(c)) and order the payment of compensation (sub-section 187(1)(d)). However, sub-section 187(4) imposes a limit on the monetary value of the orders that the Tribunal may make. Relevantly, the Tribunal must not make an order for payment of an amount that exceeds the amount prescribed by the regulations. Regulation 22(9) of the RT Regulation prescribes that amount as $15,000.00.

  8. The tenant contends that the landlord breached the obligation imposed on him by sub-section 75(2) of the RT Act by unreasonably withholding his consent to the subletting of the premises. He contends that he suffered damage and loss as a result of this breach and that he is entitled to be compensated for this loss. He says that the measure of this loss is the rent he would have received from the sub-tenants had his proposed sub-tenancies been consented to.

  9. To succeed in his claim the tenant must prove to the civil standard of proof that there was a breach of the RTA by the landlord, and that the damage and loss he alleges results from the usual course of events or that it was in the reasonable contemplation of both parties at the time they made the contract: Hadley v Baxendale [1854] 9 Exch 341. He must also prove his loss: Nancarrow & Anderson v Shellharbour City Council [2011] NSWCTTT 607.

  10. The purpose of compensating an injured party for a loss arising from a breach of contract by the other party is to place them in the position they would have been in had the contract been performed. In this respect the claimant must prove their loss: Robinson v Harman [1948] EngR 135; Commonwealth v Amann Aviation Pty Ltd [1992] 174 CLR 64. The injured party cannot recover compensation for any loss that could have been prevented by reasonable mitigation action. Loss which is attributable to a failure to mitigate is an aspect of the causation of the loss: Castle Constructions Pty Ltd v Fekula Pty Ltd [2006] NSWCA 133 at [21].

Consideration

Landlord’s application

  1. As noted above, there is no dispute between the parties that as at 21 July 2017 the tenant owed rent for 101 days from 11 April 2017. There was a minor controversy about the actual sum of rent owed which led to the Managing Agent ultimately resting on $15,390.85, which was slightly less than the figure the tenant had contended for. This discrepancy is of no significance to the outcome of the proceedings because of the limit imposed on the Tribunal’s order making power by sub-section 187(4) of the RT Act and Regulation 22(9) of the RT Regulation. I therefore make a finding that the tenant breached his obligation to pay rent in accordance with the agreement, and that the amount of unpaid rent that stood owing to the landlord as at the date of the hearing was $15,390.85. Pursuant to section 187(1)(c) of the RT Act the tenant is ordered to pay the landlord $15,000.00 towards these areas immediately (being the maximum amount the Tribunal has the power to order).

The tenant’s application

  1. The tenant claims that the landlord unreasonably withheld consent to the sub-letting of the residential premises in the following ways:

  1. from 4 April 2017 to 24 April 2017: by refusing to consider any sub-lease proposal on the basis that he had served a notice of termination of the residential tenancy agreement on 8 March 2017 which required the tenant to give vacant possession by 27 March 2017, and when the tenant had failed to do so, because he had applied to the Tribunal for a termination order;

  2. from 24 April 2017 to 5 May 2017 in respect of the enclosed balcony, and from 24 April 2017 to 8 May 2017 in respect of bedroom 2: by refusing to consider any sub-lease proposal on the basis that sub-letting had already been approved in respect of Mr Co and Mr Luan and Ms Lia respectively for these periods, notwithstanding that the tenant had terminated their leases in both cases prior to the end of the end of the fixed term;

  3. after 5 May 2017 in respect of the enclosed balcony, and 8 May 2017 in respect of bedroom 2, by making arbitrary, intrusive, and impossible to satisfy demands for information about proposed sub-tenants which delayed consideration of their sub-tenancy proposals; and

  4. after 5 May 2017 in respect of the enclosed balcony, and 8 May 2017 in respect of bedroom 2, by advising prospective sub-tenants that the head-lease would shortly be terminated requiring them to move out and by otherwise communicating “injurious falsehoods” about the tenant to prospective sub-tenants with the purpose or effect of discouraging them from proceeding with their applications.

  1. Section 75(2) of the RT Act prohibits a landlord from “unreasonably” withholding consent to the partial sub-letting of premises. The word “unreasonably” is not defined in the section or elsewhere in the RT Act. However, it is an ordinary English word, which should be given its ordinary meaning. To act “unreasonably” is to act without reason or good sense, or without moderation, or arbitrarily. Sub-section 75(3) of the RT Act also provides some guidance as to how the word is to be interpreted and applied. Without limiting the permissible bases upon which a landlord may withhold consent, it sets out three permissible (or reasonable) bases upon which such consent may be withheld: over-occupation or overcrowding and where the proposed sub-tenant is listed on a residential tenancy data base.

  2. The tenant’s contention that the landlord acted unreasonably in refusing consent to sub-letting from 4 to 24 April 2017 cannot succeed in my view. At that time, the landlord had issued the tenant with a notice of termination of the residential tenancy agreement which required the tenant to give vacant possession on 27 March 2017. Due to the tenant’s failure to comply with that notice, the landlord had an application before the Tribunal for an order terminating the residential tenancy agreement.

  3. It appears to me that it is entirely reasonable for a landlord to refuse consent to the sub-letting of premises when they are seeking to recover possession of premises from the head tenant according to law. The approval of an estate in the land (the sub-tenancy) in these circumstances would have the potential to operate to reinstate the head tenancy in my view. Even if that were not the case, in my opinion it is a factor that would weigh heavily against termination in the exercise of the Tribunal’s discretion to make a termination order under section 87 of the RT Act. In other words, on any view, the approval of a sub-letting proposal in these circumstances would prejudice the landlord’s attempt to recover possession and he could not reasonably be expected to act contrary to his own interests.

  4. The tenant contends that the landlord’s case for a termination order was “very weak” and as unlikely to succeed, and that the Tribunal should take this into account in deciding if consent to sub-letting was unreasonably refused during this period. I do not accept the premise upon which that proposition is made. Nor do I accept the proposition as a matter of fact.

  5. When the landlord’s application for a termination order first came before me on 14 April 2017 I satisfied myself that the notice of termination he relied upon complied with the requirements for a termination notice contained in Part 5 of the RT Act, and that the termination notice had been served on the tenant in a manner authorised by section 223 of that Act. The application was therefore competent.

  6. There was really no dispute that the tenant had breached the RTA by keeping a dog at the premises. The question for the Tribunal was therefore whether this breach was, in all the circumstances, sufficiently serious to justify a termination order being made. The tenant’s case, as I understood it at the time, was that he had remedied the breach by removing the dog in February 2017. He asserted this fact repeatedly in the course of the hearing while under a solemn promise to tell the truth. The landlord’s case, as I understood it at the time, was that this was not the case, as the dog remained at the premises. Due to the consent orders made at the commencement of the hearing, I am not called upon to determine if a termination order should be made on the landlord’s application.

  7. However, after having carefully considered all of the evidence filed by the parties in relation to the termination application, I have no doubt that the tenant continued to have a dog at the premises after February 2017 and in all probability that the dog remained at the premises at the date of the hearing. The landlord’s case for a termination order on this ground was therefore never “weak”. In my view it was likely to have succeeded, particularly in circumstances where it would appear that the tenant knowingly and repeatedly stated a falsehood about the presence of the dog at the premises while under a solemn promise to tell the truth to the Tribunal. In those circumstances, I think it unlikely that I would have been satisfied that there was any effective remedy for the breach other than a termination order.

  8. The tenant’s contention that the landlord unreasonably refused to consent to sub-letting of the premises during the term of sub-tenancies that had already been consented to, but which had been terminated by the tenant prior to the end of the fixed term, must also fail in my view. The tenant appears to approach the matter on the basis that the landlord was somehow under a duty to act promptly to approve sub-tenancies so as to minimise any loss to the tenant’s sub-letting enterprise. The landlord had no such obligation. The landlord had his own interests to protect and obligations to fulfil. He was entitled to act cautiously having regard to those interests and obligations.

  9. Up to that point the landlord had consented to three sub-tenancies and each had ended in dispute, and one had resulted in litigation. The landlord had no reliable way of knowing, at that time, the terms upon which Mr Co’s and Mr Luan and Ms Lia’s tenancies had come to end and if there would be any residual dispute that may impact on the tenant’s head tenancy, including an attempt by either sub-tenant to resist the notice terminating their sub-tenancy. It is clear that the Managing Agent had information from the tenant and the sub-tenants about the termination of the sub-tenancies, and that from an objective point of view, there was little prospect of the sub-tenancies continuing. Nevertheless, I am satisfied that a prudent landlord would have acted as the landlord did in this case by protecting his or her position until it was clear that the sub-tenants had given vacant possession and that the contractual obligations between the tenant and sub-tenant had ended.

  10. I am satisfied that this was reasonably necessary to ensure that the landlord did not find himself unintentionally in breach of By-Law 20.8 which prohibited more than 4 unrelated occupants of the premises at any time. I also note in this respect that sub-section 75(3) of the RT Act stipulates that permissible reasons for the landlord to withhold consent to a sub-tenancy include circumstances where this would result in more than more than the approved number of occupants occupying the premises and where it would lead to overcrowding.

  11. Moreover, pursuant to the sub-tenancies to which the landlord had consented, and the unauthorised occupancy of the premises by Ms Khurshid and Ms Goel, there had been a total of six people unrelated to the tenant living at the premises since the commencement of the tenancy. Ms Chiu contended that the landlord was concerned about wear and tear to the premises arising from seven people occupying the premises within this relatively short (eight month) period. If sub-tenancies had been approved before the end of the fixed terms of Mr Co and Mr Luan and Ms Lia’s sub-tenancies, it would have resulted in there having been 9 or 10 occupants of the premises in this short period. Ms Chui also contended that the landlord was concerned that this pattern of occupancy of premises had the potential to result in him being in breach of By-Law 20.13 which precludes premises being used for temporary accommodation. In my view, both concerns were entirely reasonable in the circumstances.

  12. The tenant’s claim that after 5 May 2017 with respect to the enclosed balcony and 8 May 2017 in respect of bedroom 2, the Managing Agent’s requests for information about prospective sub-tenants were arbitrary, intrusive and impossible to satisfy are not borne out on the evidence. The evidence establishes that the Managing Agent assessed applications for sub-tenancies against the “Tenant Selection Criteria” it used to assess applications for tenancy. Those criteria are in writing and the tenant admits that he received a copy of these criteria when he made his own application to lease the premises. The most he is able to say in support of his own case is that he did not realise that these criteria were also being used to assess applications for sub-tenancies. However, it is also clear that at no time prior to 22 May 2017 did the tenant ask the Managing Agent to clarify what the criteria for the assessment of sub-tenancy proposals were. When he did ask the Managing Agent for these criteria on 22 May 2017, a copy was promptly provided to him.

  13. The tenant selection criteria require the applicant for a sub-tenancy to provide personal identification in photographic form, either a current driver’s licence or a passport and visa, or confirmation of enrolment. There is nothing objectively unreasonable about requiring an applicant for a sub-tenancy to verify their identity and residency status. The landlord would require this information to comply with By-Laws 20.5 and 20.13. The landlord would also require this information to carry out a tenant data base search which is one of the permissible grounds upon which consent to a sub-tenancy may be withheld (sub-section 75(3) of the RT Act). Given the landlord’s liability to the Owners Corporation for any damage to the common property caused by an occupier it was also reasonable for the landlord to obtain adequate personal identification documentation for prospective sub-tenants.

  14. Similarly, the requirement for a prospective sub-tenant to provide proof of their last residential address in the form of an electricity account or telephone bill, and copies of previous rent receipts or a tenancy ledger, is reasonably related to the objective of identifying the tenant for the purposes of establishing their residency status and if they are listed on a residential tenancy data base, among other things.

  15. Additionally, the requirement that the prospective sub-tenant provide a rent payment record is reasonably related to the objective of the landlord establishing that they have the capacity to pay rent and a history of doing so. The requirement that the prospective sub-tenant provide proof of income and financial capacity is also reasonably related to this objective.

  16. The tenant complains that some of the sub-tenants he proposed, or would have proposed if he had the opportunity, could not provide a rent payment record because they had only just arrived in Australia. However, that fact does not render the landlord’s assessment criteria arbitrary or impossible to satisfy. That is a material fact the landlord’s assessment criteria are properly designed to ascertain. It is a fact which goes to the risk the landlord is willing to bear in deciding whether to consent to the sub-tenancy.

  17. I am satisfied on the evidence before me that the tenant failed to provide all of this information to the Managing Agent with his applications to sub-let to Mr Stoh on 15 May 2016 and Mr Widjaja on 28 May 2017. This resulted in the Managing Agent reasonably requesting that further documentation be provided so that the applications could be properly assessed. Mr Stoh’s sub-tenancy was consented to on or before 23 May 2017, two working days after the tenant provided the Managing Agent with the last of the documentation she had requested, and one working day after the Managing Agent met personally with him. Mr Widjaja’s sub-tenancy was consented to on 3 June 2017, two working days after the tenant provided the Managing Agent with the last of the documentation she had requested, and two days after she met personally with him. There was no unreasonable delay in the Managing Agent considering the tenant’s sub-letting proposals in respect of Mr Stoh or Mr Widjaja in these circumstances. There can be no argument that there was an unreasonable delay in the Managing Agent considering the tenant’s application to sub-let to Ms Raun as he never provided the necessary documents in support of that application.

  1. The tenant’s claim that the Managing Agent engaged in conduct that deterred potential sub-tenants from proceeding with their applications rests on two complaints. First, that the Managing Agent insisted that the tenant inform the sub-tenant of the landlord’s application for a termination order and that the head tenancy may be terminated before the end of the fixed term of the sub-tenancy. There is no dispute that the Managing Agent required this or that she confirmed this with the proposed sub-tenants when she met with them personally. Second, the tenant complains that the Managing Agent told prospective sub-tenants “injurious falsehoods” about him in relation to his character and reputation.

  2. There is nothing objectively unreasonable about the landlord’s Managing Agent requiring the tenant to advise prospective sub-tenants of the termination proceedings, or about her communicating this information to prospective sub-tenants directly. Had the Managing Agent not done so, she may have been guilty of an offence under section 26 of the RT Act, which imposes an obligation on a landlord and a landlord’s agent not to induce a tenant to enter into a RTA by any statement, representation or promise that the landlord or agent knows to be false, misleading or deceptive. In this respect the definitions of “landlord” and “tenant” in section 3 of the RT Act operate to impose this obligation on the landlord under a head lease if called upon to consent to a sub-lease in my view. It would have been misleading and deceptive of the landlord to consent to a fixed term sub-tenancy agreement over premises at a time when he was engaged in litigation which had the objective of recovering possession unless that fact, and its potential consequences for the sub-tenancy, were fully disclosed to the sub-tenant prior to them entering into the sub-tenancy.

  3. There is limited evidence before me as to the specifics of any statements made to prospective sub-tenants by Ms Chiu about the tenant’s character and reputation. However, the evidence before me is sufficient to establish that Ms Chiu did attempt to warn Mr Stoh and Mr Widjaja about the tenant’s sub-letting enterprise, his history of falling into dispute with sub-tenants, and his litigation against sub-tenants. At this level, this information was objectively factual, and a matter of public record. I do not consider it to have been unreasonable for Ms Chiu to seek to communicate this information to Mr Stoh and Mr Widjaja. In any event, the communication of this information to Mr Stoh and Mr Widjaja did not result in them abandoning their applications for sub-tenancies.

  4.  t is true that Mr Stoh abandoned his sub-tenancy after only one day of occupancy. However, there is no evidence before the Tribunal that establishes that this resulted from anything said to him by Ms Chui or any other representative of the Managing Agent about the tenant. The evidence establishes that his stated reason for abandonment was a ‘457 visa nightmare,’ whatever that may mean.

  5. For the foregoing reasons, the tenant has not established on his evidence that there was any breach by the landlord of his obligation not to unreasonably withhold consent to the sub-letting of the premises. No entitlement to compensation has therefore been established. However, for completeness, I make two observations in relation to that compensation claim.

  6.  First, the claim does not appear to me to reflect the tenant’s actual loss. The tenant lived at the premises at all material times for the compensation claim, yet the compensation he seeks exceeds the whole rent payable during this period. Additionally, the tenant makes no account of the benefit he was deriving from his own occupation of the premises. He would thus be unjustly enriched if the Tribunal were to order compensation in the amount he claims.

  7. Second, properly characterised, the tenant’s claim is one of lost revenue to his sub-letting enterprise. The tenant has placed no business records before the Tribunal that would enable it to properly ascertain the actual loss to this enterprise he suffered, if any. Even if he had done so, I am not satisfied that this loss could be said to arise naturally from the breach asserted, or to have been a form of damage and loss that was in the reasonable contemplation of the parties when they entered into the RTA. Indeed, the evidence is clear that the landlord never contemplated at the time he entered into the RTA that tenant would be operating a sub-letting enterprise from the premises, and that he was dismayed when this crystalised. In these circumstances lost revenue from the sub-letting business would not have been a recoverable form of loss on either limb of the test in Hadley and Baxendale.

Conclusion

  1. For the foregoing reasons the landlord is entitled to an order that will require the tenant to pay him $15,000.00 towards the rent arrears he owed up to the date of the hearing immediately. The tenant’s application for compensation must be dismissed.

P French

General Member

Civil and Administrative Tribunal of New South Wales

25 August 2017

I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales.


Registrar

Decision last updated: 08 September 2017

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Diago Lobo v Abdel-Messih [2016] NSWCATCD 14
In the matter of an application by the Chief Commissioner of Police (Vic) [2005] HCA 18
Re Luck [2003] HCA 70