Appellant v Respondents

1 The appellant occupied rented premises owned by the respondent landlords. On 15 June 2006 the respondents instructed their agent, Ms Jennifer Hussey, to issue a Notice to Vacate and an application to the Victorian Civil and Administrative Tribunal ("VCAT") for a possession order, which Ms Hussey did, on that day by accessing the VCAT online service. The Notice to Vacate and the application were enclosed in the same envelope and the documents were sent to the appellant by registered post. It is not disputed that the documents were received by the appellant on 16 June 2006, thus the Notice to Vacate and the application were given, or served, concurrently. The Notice to Vacate is dated 15 June and the application, which advised that the return date was 6 July 2006 and that the claim was for possession and rent, was lodged with VCAT as the document itself records "via VCAT online on 15 June 2006, 11.16am."

2 The matter came before Member Wiseman on 6 July 2006. The respondents were represented by their agent, Ms Hussey, and the appellant appeared in person. An order for possession was made, effective that day, and on 8 August 2006 the appellant applied for, and was granted, a stay of the order pending the appeal.

3 The sole issue of this appeal is whether the Tribunal has jurisdiction to make the order for possession applied for by the respondent landlords under s.322(1) of the Residential Tenancies Act 1997. The issue for determination is whether the landlords' service on the appellant of a Notice to Vacate together with an application for a possession order is sufficient to invoke the Tribunal's jurisdiction to make the order for possession.

4 Mr Duggan, counsel for the appellant, submitted that the respondents had purported to act pursuant to s.322(1) of the Residential Tenancies Act 1997 as governed by the provisions of s.326 of that same Act and that as the application for possession was made before the Notice to Vacate was given to the appellant the pre-condition for jurisdiction had not been met. As I understand his argument a strict interpretation of the language of the act is required and a failure to comply with procedure set out in s.322(1) and s.326 of the Act for the making of a valid possession order, in this case, constitutes a substantive defect that goes to the heart of VCAT's jurisdiction to make the order. Mr Duggan submitted that this case was analogous to that of Smith v The Director of Housing[1], where it was held that a failure to issue a valid Notice to Vacate deprived VCAT of jurisdiction to hear the landlords' application and that the decision of the Tribunal was a nullity.

5 Mr Duggan also relied upon the obiter of the Honourable Justice Smith in the Director of Housing v Pavletic[2] where it was said by way of obiter that the right of the landlord to apply for an order of possession is conditioned on the giving of a Notice to Vacate and in that case where a finding could not be made that the notice was given before the application was made, the respondent had at least a defence to the application, one that would render futile remission of the matter to the Tribunal if the appellant were to have made out its case on the question of law.

6 Mr Sandbach on behalf of the respondents submitted that concurrent service is an industry practice, as deposed to by Ms Hussey in her affidavit sworn 12 October, 2006, and that any defect in the giving of the notice and the application is merely procedural and cannot be taken to be a jurisdictional impediment given the wide powers conferred upon the Tribunal to make such orders in respect of Tenancy Agreements under s.446 and s.472 of the Act. Further, Mr Sandbach submitted that s.97 of the Victorian Civil and Administrative Tribunal Act 1998 requires "The tribunal to act fairly and according to the substantial merits of the case in all proceedings" and that that occurred here. To that end, Member Byard's observations in Ritchie's Stores Pty Ltd v Bass Coast[3] were relied upon. There the view was taken that s.126(2)(b) of the Residential Tenancies Act empowers the Tribunal to disregard failures to comply with statutory or procedural requirements when it considers it to be in the interests of justice to do so. Further, the purpose of these provisions are to enable matters to be determined, rather than avoided, and determined on their real and substantial merits and not on the basis of mere technical slip-ups.

7 Mr Sandbach also relied upon the provisions of s.335 and s.336 of the Residential Tenancies Act which provides for an alternative procedure for possession by a landlord. There s.336(3) provides that a Notice to Vacate must be accompanied by an application pursuant to s.335 together with other documentation. Thus, he submitted, this was an example of a prior notice not being a pre-condition to the application being made, as the Act there clearly contemplates the Notice to Vacate and the application being given to the tenant concurrently.

8 Turning first to the provisions of s.322(1) and s.326, of the Residential Tenancies Act 1997 and the alternative provisions for the grant of possession order under s.335 and s.336. These sections are the only provisions of the Residential Tenancies Act 1997 pursuant to which the Tribunal can make an order for possession in favour of the landlord. Both sections clearly articulate procedural requirements to be complied with for the making of an application for possession and they stipulate different procedures. Under s.322(1) a landlord may apply to the Tribunal for a possession order for rented premises if the landlord has given the tenant Notice to Vacate. Such an application is governed by s.326 which stipulates under subsection (1) that an application made under s.322(1) maybe made at any time after the Notice to Vacate is given, but not later than 30 days after the termination date specified in the notice. The language of these sections is both clear and unambiguous. By use of the words "if" and "after" respectively, the legislature has made it a pre-condition of the making of the application for possession order that a Notice to Vacate be first given to the tenant.

9 Under s.335 the landlord may apply to the Tribunal for a possession order for rented premises if the tenant owes at least 14 days rent to the landlord. Pursuant to s.336, on making the application under s.335 the landlord must give the tenant personally, or by registered post a Notice to Vacate the rented premises. Under subsection (2) the notice must specify a termination date that is not less than 14 days after the date on which the notice is given and under subsection (3) the Notice to Vacate must be accompanied by a copy of the landlord's application for possession under s.335 and other documents. Section 336 requires the provision of 14 days to elapse before an order for possession can be granted, presumably to afford protection to the resident in possession who is otherwise vulnerable to eviction. No protection is similarly afforded to a tenant, the subject of a Notice to Vacate under s.322(1), making strict compliance with the procedural requirements stated therein necessary to ensure that justice is afforded to all parties.

10 If follows from a strict interpretation of the language of these sections that for a valid application for a possession order to be made by the landlord under s.322(1) a Notice to Vacate served on the resident tenant must precede such an application.

11 In Smith v Director of Housing the Honourable Justice Bongiorno was required to determine the validity of a Notice to Vacate served upon the appellant, and whether a want of information contained therein as required by s.244, in order to make the application for possession under s.322(1), rendered the application for possession a nullity.

12 His Honour there observed that the procedure stated in s.244 for a valid application for possession is designed to protect the quiet enjoyment of neighbours' properties by permitting a rapid eviction to occur in appropriate circumstances. The procedure involves the service of Notice to Vacate followed, if necessary, by an application to VCAT pursuant to s.322(1) of the Act. This application can result, in theory at least, in an order for possession in favour of the landlord effective virtually immediately as the termination date may be the date the notice is given, although that is not the case here where the reason for the Notice to Vacate is non-payment of rent.

13 Nonetheless, owing to this rapidity it would seem, in this case, justice requires that any interpretation of the nature of the timing requirements in s.322 of the Act ought to favour the tenant, who is otherwise completely vulnerable. Indeed, as the Honourable Justice Smith in Director of Housing v Pavletic stated, "... the procedure being blunt and speedy in respect of s.322(1) the Act lays down strict requirements for a Notice to Vacate to be valid". Such reasoning ought, analogously, apply to the present circumstances where the consequences of the service of a Notice to Vacate, despite the failure to comply with the procedure laid down in s.332(1), would visit the same consequences upon the tenant upon an order for possession being made where the Notice to Vacate has not been withdrawn (see s.330 of the Act).

14 Section 335 is in terms which maybe said, as Mr Sandbach submitted, contemplates a Notice to Vacate being given at the same time as the application for possession and thus in that instance, the application is not pre-conditioned by the prior giving of a Notice to Vacate. Clearly, however, s.335 and s.336 prescribe an alternative procedure to s.322(1) whereby a landlord may apply for a possession order. A landlord may apply under either s.322(1) or s.335 and s.336 of the Act but having elected to apply under one section or another, the landlord is obliged to comply with the requirements of that section. Thus, the landlord in sending the Notice to Vacate in the same envelope as the application, as occurred here, has in fact complied with neither of the procedures required by the legislature. The Act does not provide for an amalgam of the two procedures which appear to have occurred here and it is no answer to say that it is either industry practice or general practice of VCAT to accept concurrent Notices to Vacate and applications for possession where the landlord elects to proceed pursuant to s.322(1).

15 It must also be noted that there is no saving provision under the Act to cure an application for possession by a landlord that is procedurally defective where a Notice to Vacate is not first served but could otherwise be taken to be effective. This supports the view that strict compliance with procedural requirements contained in s.322(1) is a prerequisite to valid application for possession being made, especially in circumstances where to remedy the procedural defect would be to the detriment of the appellant tenant.

16 Certainly s.126 of the VCAT Act 1998 gives the Tribunal wide powers to make orders with respect to time limits. That section states that the Tribunal may, on application by any person or of its own initiative, extend any time limit fixed by, or under, the enabling enactment for the commencement of a proceeding. Under subsection 2(b) the Tribunal may waive compliance with any procedural requirement, other than a time limit that the Tribunal does not have power to extend or abridge. Under s.126(4) of the Act, however, the Tribunal may not extend or abridge time or waive compliance if to do so would cause any prejudice or detriment to a party, or potential party, that cannot be remedied by an appropriate order for costs or damages.

17 It follows that the exercise of power in accordance with the above must be done so, in favour of the party the subject of the vacation order. It also seems a proper construction of s.126(2)(b) that the procedural requirements referred to therein are those which arise after the commencement of a proceeding in the Tribunal and that is not the application here. Although I note the observations to the contrary by Member Byard in Ritchie's Stores Pty Ltd v Bass Coast where it was stated that the power was not limited to procedural requirements arising after the commencement of a proceeding before the Tribunal and that it would be an unfortunate and very restrictive limitation on its ability to act fairly and according to the substantial merits if that were not so. Nonetheless, despite those observations, s.126(1)(a) and (2)(b) tend to support the view that the procedural requirements referred to in s.126(2)(b) are those that arise after the commencement of a proceeding in the Tribunal. Member Byard stated that the purpose of the provision is to enable matters to be determined, rather than avoided, on their real and substantial merits and not on the basis of, as Member Byard referred to, as "mere technical slip-ups." Member Byard then went on to remark nonetheless that where a point is a good point, it must be upheld, whether or not it might be described as a technical point and that, in my view, is the case here. No application was made before the Tribunal to abridge time or to waive non-compliance with the requirements of s.322(1) and s.326 and in any event as the application was not validly before the Tribunal it is clear from Smith's case that the Tribunal cannot make an amendment which seeks to give the Tribunal jurisdiction where none previously existed.

18 Mr Sandbach further relied upon the fact that the appellant chose to be unrepresented at the Tribunal and that that should be taken into account with regard to the interests of justice in permitting the matter to be dealt with for the first time on appeal. Mr Duggan submitted that it is not to the point whether it could have been raised at the Tribunal, if the matter was not validly before the Tribunal, it did not have jurisdiction to deal with the matter and thus raising the issue before the Tribunal could not have cured the defect.

19 In my view, it matters not whether the issue was raised below because, other than striking out the application, the Tribunal could not have made any order which would have vested it with jurisdiction, the application not being properly before it in the first place. Indeed, as the practice has been accepted by both VCAT and the industry and, as Ms Hussey stated in her affidavit, a previous notice and application was given to the appellant concurrently to which she took no objection, it is unlikely that the appellant, being a lay person, would have appreciated that the application had not been made in conformity with the Act. As the issue raised is one which is fundamental to the jurisdiction in my view the fact that it was not taken by an unrepresented person is not a bar to it being entertained on appeal, especially if the point is a good one as it is here.

20 Mr Sandbach also submitted that to permit the matter to be raised on appeal for the first time gives rise to a prejudice to the landlord whose rights to possession have been affected by a stay on the order where the notice to vacate was otherwise valid. Whilst the landlord's right to possession has been affected by the stay it nonetheless must be counterbalanced with the appellant's rights in circumstances where the only issue is the non-payment of rent and the respondent has not sought to have the appellant tenant vacate for any other reason and there is no evidence which suggests the appellant is not otherwise complying with the Tenancy Agreement. Indeed, if there were, the respondent landlords still retain rights under the Act to issue a Notice to Vacate.

21 Mr Sandbach also relied upon the power of the Tribunal to regulate its own proceedings and cited to that effect the dicta of the Honourable Justice Brooking in the case of M v M[4] where it was stated that "Justices may regulate their own proceedings provided they do not introduce an improper practice or one inconsistent with the statute" and that the courts will not interfere with the established practice unless it appears to be manifestly wrong or unjust. The judgement went on to state:

"so it has been said that where the enabling statute, or rules or regulations lawfully made there under are silent as to procedural matters an inferior Court has power to control its own procedures".

22 Applying that principle to this case, the statute has prescribed procedures and here they have not been complied with.

23 For the above reason, I am satisfied that the Tribunal lacked the jurisdiction to hear the application before it and to make the consequent orders. Accordingly as the issue of jurisdiction is fundamental I am satisfied that exceptional circumstances here exist which permit the raising of the point for the first time on appeal. Accordingly the appeal is upheld and the order of the Tribunal made on 6 July 2006 is quashed.

[1] [2005] VSC 436.

[2] [2002] VSC 438.

[3] SC (2003) 14 VPR 82.

[4] [1993] VicRp 29; (1993) 1 VR 391 at p.395.