Bell v Sultana and Longo

NCAT Consumer and Commercial|2024-07-22

PARTIES

The Applicant was the former tenant of residential premises in Lalor Park. The Applicant shall hereinafter be referred to as "the Tenant".
The Respondents are the Landlords of the premises. The Respondents shall hereinafter be referred to as "the Landlords".
At the hearing the Tenant represented herself. The Landlords were represented by their agent Eden Farlow.

APPLICATION

In an application filed in the Tribunal on 8 April 2024, the Tenant requested an order for rent reduction, compensation for failure to carry out repairs, an order for the Landlords to carry out repairs and a declaration that a termination notice served by the Landlords was retaliatory. She also sought damages for non-economic loss due to the stress, anxiety, disappointment and inconvenience caused by the Landlord's breaches of the residential tenancy agreement.

FACTUAL FINDINGS REGARDING TENANCY

From the evidence the Tribunal finds the Landlords and Tenant first entered into a residential tenancy agreement on or about 20 March 2019.
The parties subsequently entered into a second tenancy agreement dated 17 February 2022 ("the second tenancy agreement"). The period of the agreement was 6 months commencing on 16 March 2022 and ending on 13 September 2022. At the expiration of the fixed term, the tenancy became a periodic tenancy.
The Landlords served the Tenant with a notice of termination dated 18 March 2024 under section 85 of the Residential Tenancies Act 2010 ("the RTA"). The notice gave the Tenant 90 days to vacate the premises and required vacant possession on 16 June 2024.
The Tenant alleged the notice was retaliatory. She filed this application on 8 April 2024. The Landlords filed an application seeking an order for termination and possession when the Tenant did not vacate the premises by 16 June 2024.
The Landlords' application was listed on 8 July 2024. The Tenant returned the keys and gave vacant possession on 8 July 2024. The Landlords withdrew their application.
The Tribunal finds the tenancy ended on 8 July 2024 when the Tenant gave vacant possession. Accordingly, it is not necessary to decide whether the notice was retaliatory.

TENANT'S CLAIM FOR COMPENSATION

The Tenant claimed $6144.58 as compensation for reduction in the use of the 3rd bedroom for a period of 12 months. Although the initial claim was for rent reduction, the Tribunal treats it as a claim for compensation because the Tenant has vacated the premises. Additionally, the Tenant claimed compensation due to the Landlords failure to properly maintain the premises and repair the roof to prevent water ingress into the 3rd bedroom

RELEVANT LAW

The RTA contains several provisions which entitles a tenant under a residential tenancy to make a claim against a landlord. The claim does not necessarily have to involve a breach of agreement and could be made on some other ground.
In these proceedings, the Tenant's claim must be considered by reference to both sections 63 and 44 of the RTA. There are different time limit considerations in bringing claims under section 63 and section 44.
As was said in Roberts v NSW Aboriginal Housing Office [2017] NSWCATAP 9 at [88], in a passage cited with approval by Basten J in Makowska v St George Community Housing Ltd [2021] NSWSC 287 at [46]: "That is not to suggest that a claim for damages for loss of quiet enjoyment and an order for the reduction of rent are mutually exclusive forms of relief. Depending on the claims made, there may be facts common to both types of claim which would need to be taken into account in order to avoid double compensation. For example if the premises (or part thereof) cannot be used in the manner intended or its use is in some way impaired by reason of a landlord's breach, it may be inappropriate to both reduce the rent and make an award of damages for loss of use."
The Tenant claimed the Landlords breached their obligations to provide and maintain the premises in a reasonable state of repair, having regard to the age of, rent payable and prospective life of the premises (section 63(1) of the RTA) which amounted to a breach of her quiet enjoyment.
The landlord's general obligation to maintain the premises in a reasonable state of repair is set out in section 63 of the RTA which provides: 63 LANDLORD'S GENERAL OBLIGATION (1) A landlord must provide and maintain the residential premises in a reasonable state of repair, having regard to the age of, rent payable for and prospective life of the premises. (2) A landlord's obligation to provide and maintain the residential premises in a reasonable state of repair applies even though the tenant had notice of the state of disrepair before entering into occupation of the residential premises. (3) A landlord is not in breach of the obligation to provide and maintain the residential premises in a reasonable state of repair if the state of disrepair is caused by the tenant's breach of this Part. (4) This section is a term of every residential tenancy agreement.
A breach of the obligation to provide and maintain the residential premises in a reasonable state of repair may constitute a breach of the residential tenancy agreement which gives rise to a claim for compensation.
In Hyndes v Maddak Pty Ltd [2021] NSWCATAP 302 the Appeal Panel stated at [52]-[53] claims for breach of the covenant of quiet enjoyment and failure to repair are claims for breach of the residential tenancy agreement to which section 190(1) of the RTA apply.
Any claims for breaches of the residential tenancy agreement (including breaches of quiet enjoyment and failure to repair) must be commenced within the period specified in the Residential Tenancies Regulation 2019 (NSW). The period prescribed by Regulation 39(9) is 3 months after the applicant becomes aware of the breach.
In Pongrass v Small [2021] NSWCATAP 314 the Appeal Panel provided guidance on what constituted a breach of quiet enjoyment. The Appeal Panel stated at [55] - [56]: 55 The landlord has referred the Appeal Panel to numerous other decisions, for example Martin's Camera Corner Pty Ltd v Hotel Mayfair Ltd (1976) 2 NSWLR 15, where the issue was alleged breach of covenant due to water seepage. The water seepage was found to be a breach of quiet enjoyment. In the decision, Yeldham J referred to the definition of the covenant for quiet enjoyment as set out in Halsbury's Laws of England (3rd edition), vol 23 (1964) at [1298]-[1299] as follows: "The covenant for quiet enjoyment operates according to its terms to secure the tenant, not merely in the possession, but in the enjoyment of the premises for all usual purposes; and where the ordinary and lawful enjoyment of the demised premises is substantially interfered with by the acts or omissions of the landlord all those lawfully claiming under him, the covenant is broken, although neither the title to, nor the possession of the land may be otherwise affected...

If the act causes physical interference with the demised premises, there is a breach of covenant, notwithstanding that the act itself is done off the premises." 56 What constitutes a breach of quiet enjoyment was considered in Kenny v Preen [1962] EWCA Civ 2; (1963) 1 QB 499 at 512-3 by the Supreme Court of Judicature, Court of Appeal where Lord Justice Pearson said: "I would decide on two grounds in favour of the tenant's contention that there was, in this case, a breach of the covenant for quiet enjoyment. First, there was a deliberate and persistent attempt by the landlord to drive the tenant out of her possession of the premises by persecution and intimidation, and intimidation included threats of physical eviction of the tenant and removal of her belongings. In my view that course of conduct by the landlord seriously interfered with the tenant's proper freedom of action in exercising her right of possession, tended to deprive her of the full benefit of it, and was an invasion of her rights as tenant to remain in possession undisturbed, and so would in itself constitute a breach of covenant, even if there were no direct physical interference with the tenant's possession and enjoyment...

Secondly, if direct physical interference is a necessary element in the breach of covenant that element can be found in this case to a substantial extent, as I have already stated."

It is well settled that a claim for compensation for loss of quiet enjoyment of the premises and for inconvenience do not constitute a claim for personal injury damages and do not fall within the definition of non-economic loss in section 3 of the Civil Liability Act 2002 (NSW).
The authorities make it clear any finding on whether there has been a breach of the covenant of quiet enjoyment will need to be decided on the facts of the case and the authorities as to what is a breach of that covenant (see Hyndes v Maddak Pty Ltd [2021] NSWCATAP 302 at [40])
A breach of the obligation to provide and maintain the residential premises in a reasonable state of repair may constitute a breach of the residential tenancy agreement which would give rise to a claim for compensation.
In relation to a claim for rent reduction, section 44(3) of the RTA provides: Applications on withdrawal of goods or services A tenant may, before the end of a tenancy, make an application that the rent is excessive, having regard to the reduction or withdrawal of any goods, services or facilities provided with the residential premises, even if those goods, services or facilities were under a separate or a previous contract, agreement or arrangement.
Any application for a reduction in the rent must be made before the end of the tenancy. The tenancy ended on the 8 July 2024. The application was lodged on 8 April 2024. Accordingly, the application was made before the end of the tenancy and was within time.
The application will no longer be considered as an excessive rent application but as a claim under section 187(c) and (d) of the RTA for compensation and payment of money on the basis that there has been a reduction or withdrawal of goods, services and facilities during the tenancy.
In Annette Shailer v Camille Serisier [2016] NSWCATAP 131, the Appeal Panel considered whether the Tribunal could consider a claim under more than one provision of the RTA where the legislation created an entitlement to bring a claim and the time limits which would apply. The Appeal Panel stated at [29] to [31]: 29 In circumstances where legislation creates an entitlement to bring an application before the Tribunal under more than one provision, it is sufficient for an applicant to establish an entitlement to relief under the terms of any one of those provisions, and for the Tribunal to grant such relief provided that such entitlement is established and is not otherwise unavailable by reason of any other provision of the legislation or for any other cause. Accordingly, it was appropriate for the Tribunal to consider this aspect of the claim under the provisions of section 44. 30 For the purpose of these proceedings, it is necessary to focus on the provisions of subsection (3). In general terms, it may be assumed that the factual circumstances as they pertain to these proceedings would constitute a reduction in the facilities provided within the residential premises, because of the inability to make full use of the bedroom area through the inconsiderable inconvenience caused by frequent leaking of rainwater, as described. Whilst the circumstances pertaining to a reduction in the facilities might also constitute a breach of the provisions of the lease, for reasons which we have given, it is not necessary to establish a breach when determining entitlement to bring a claim under section 44(3). In the circumstances, the time limit for making such a claim is that which is set out in the subsection itself, namely that the application to the Tribunal must be made before the end of the tenancy. 31 In circumstances where the claim was made by the appellant under section 44 of the Act, and was made within the time prescribed, it follows that the appellant is entitled to consideration of her claim by reference to the totality of the period during which there has been a reduction in the facilities provided, and that the Member was in error in determining otherwise.

CONSIDERATION

The Tenant provided a "Personal Statement" as part of her evidence. She stated "Firstly, the limited use of the third bedroom has been a major source of distress. Despite repeated attempts to address the situation, the room remains uninhabitable as a bedroom, with only two solid walls and ongoing leaks compromising its safety and stability…".
Additionally, the Tenant complained about the Landlords' failure to remove the dead trees from the property. She submitted this has detracted from the aesthetic appeal of the property and been a source of embarrassment and frustration.
Further, the continual leaks in the roof have been a persistent source of stress and inconvenience. The cumulative effect of these failures was to "greatly impact my ability to enjoy a peaceful and comfortable living." for which she seeks compensation.
The Landlords disputed the Tenant's claim for compensation and argued they attended to repairs in a timely manner. They denied there was a reduction or withdrawal of any goods, services or facilities provided with the premises.
The parties provided chronologies which assisted the Tribunal in understanding the history of the tenancy. The first report of a roof leak was on or about 21 September 2019. The last reported water leak through the roof was on or about 4 April 2024.
The Tribunal finds that in the period between 21 September 2019 and 4 April 2024, the Tenant made several reports to the Landlords and their agent about water ingress from the roof into the premises.
The Tenant signed the second tenancy agreement on 17 February 2022. It was a renewal of the first tenancy agreement.
The Tribunal finds any events which occurred prior to 17 February 2022 related to the first tenancy and are out of time.
On 7 March 2022 the Tenant emailed the agent about a leak in the back bedroom. The Landlords arranged for Metcel Maintenance to repair the roof leak. The leak was fixed on or about 8 March 2022.
On 24 August 2022 the Tenant reported to the agent water was leaking through the ceiling in bedroom 2. The Tenant believed the water penetration could be from the airconditioner. The Landlords arranged for a technician to inspect the airconditioner on 25 August 2022. The technician serviced the airconditioner on 13 October 2022. He expressed the opinion the water leak was not related to the airconditioner.
On 22 February 2023, the Tenant sent an email to the agent in which she stated: "In regard to the back bedroom, yes, it is believed to be fixed. I say believed because I have noticed there are brown water marks but they also could be condensation so who knows. You have photos of the damage…". The Tenant opined the only use of the room was for storage.
On 21 March 2023 the Tenant stated in an email to the agent: "The room is used as a storeroom because it can be used as nothing else". The agent requested further information from the Tenant.
On 19 April 2023 the agent conducted a routine inspection of the premises. The photos attached to the routine inspection show the 3rd bedroom being used as a playroom. From the photos, it is clear the Tenant has reasonable use of the room. The room has a television and furniture throughout including storage units and toys. There is no evidence of mould or leaking.
On 27 April 2023 the Tenant contacted the Landlords and advised them she wanted to use the room as a bedroom. She also informed the Landlords of other issues of concern about the property.
On 6 May 2023 the Landlord and a tradesman attended the premises and carried out repairs to the wall in the 3rd bedroom. The Landlord approved the repainting of the wall on 29 May 2023.
The wall was repainted on or about 22 August 2023. The agent contended the delay in painting the wall was because the Tenant had denied access to the painter.
The Tenant made no further reports of water leaks until 4 April 2024.She told the Landlords there was a leak from the skylight into the bathroom. The Landlords arranged for a tarpaulin over the skylight to prevent water ingress.
The tarpaulin remained in place from 4 April 2024 until when the Tenant vacated the premises on 8 July 2024.
In her final submissions, the Tenant claimed a rent reduction of $1625.00 being $31.25 for 52 weeks from 7 May 2023 to 7 May 2024. She calculated the weekly amount as 1/16th of the weekly rent of $500.00 which equates to $31.25. The house has 8 bedrooms and claimed she had 50% use of the 3rd bedroom for 12 months. She asserted the 3rd bedroom was affected by black mould and water leaks which posed a safety risk and health hazard.
The Tenant relied on a series of photographs and emails to support her claims of mould and water ingress into the 3rd bedroom.
In reply to the Tenant's allegations about the roof leaks, the Landlords submitted: The timeline regarding the leaks demonstrates that the landlord has consistently taken prompt and appropriate actions to address reported issues, ensuring the property remained habitable. The timing and nature of these claims suggest they are retaliatory, linked to the recent termination notice rather than the actual living conditions of the property.
In respect of the dead trees and grass, the Landlords contended the Tenant was responsible for maintaining the garden.
As regards the gravel driveway, the Landlords asserted in their submission: Considering that the condition of the driveway remained consistent with what was initially agreed upon and that any proposed alterations were to be done at the tenant's expense, the landlord rejects any claims to the tenants pursue (sic) for compensation.
The Tenant bears the onus of proof. She must provide evidence which satisfies the Tribunal on the balance of probabilities that it is sufficient to make the orders sought in the application.
The authorities make it clear that the mere fact that there were recurrent problems does not necessarily mean that there was a breach of the covenant of quiet enjoyment.
The Landlords' submissions are compelling and persuasive. When the evidence is considered in its entirety and applying the legal principles set out above, the Tribunal is not satisfied there has been a reduction or withdrawal by the Landlords of any goods, services or facilities provided with the premises.
The Tenant complained she could not use one room in the premises as a bedroom because of mould and the possibility of water ingress. She asserted it was only fit for use as a storeroom. I reject that assertion as it is not supported by the evidence.
The Tenant's original claim for rent reduction was for the period 7 March 2022 to 7 May 2024. The effect of section 44(6) of the RTA is to limit claims for rent reduction to a period of not more than 12 months.
The photos of the 3rd bedroom taken by the agent at the routine inspections in April 2023 and May 2024 show the room as being used as a games/ children's playroom. That evidence confirms the room was used as more than a storeroom. I find that if there was any interference with the use, it was minor at best and does not warrant a rent reduction.
The agent conducted an inspection of the premises on 19 April 2023. In respect of bedroom 3, the inspection report noted: "Hairline crack-no signs of mould sighted at the time of inspection as reported by the tenant."
The agent attached 28 images of bedroom 3 to the report. The images satisfy me the Tenant had full use and enjoyment of the room as of 19 April 2023.
On 27 April 2023 the agent acknowledged in an email there was slight staining from a previous leak which had been rectified and the room was being used to its full capacity.
The Tenant disputed the agent's statement that the room was being used to its full capacity and argued the room was incapable of use as a bedroom.
The agent conducted a further routine inspection on 13 May 2024. The 43 images of bedroom 3 attached to the report confirm its continued use as a games/ children's playroom. There was no evidence of any water ingress or mould in the room.
On 4 April 2024 the Tenant advised the Landlords of a water leak from the skylight in the bathroom. The Landlords attended the property and placed a tarpaulin over the skylight on the same day.
On 30 April 2024, the Landlords arranged for Brown Wilson Roofing to provide a quote. They requested a second quote from Remmi Construction.
As noted in Hyndes v Maddak Pty Ltd [2021] NSWCATAP 302, a breach of the covenant of quiet enjoyment will be decided on the facts of the case.
The Tribunal is not satisfied on the evidence the Tenant has proved her case. The Tribunal finds the last report of water ingress into the 3rd bedroom was made by the Tenant in March/April 2023. The Tribunal finds the Landlords rectified the water leaks in the 3rd bedroom within a reasonable time after the Tenant reported the problem.
The evidence establishes the Tenant had full use of the 3rd bedroom. It was her choice as to how the room was used. The Tenant did not tender any evidence which satisfied me the 3rd bedroom continued to leak after February 2023. Accordingly, she has not proved her case for a rent reduction as there has been no reduction or withdrawal of the goods, services or facilities by the Landlords. There is no basis for awarding her compensation.
Additionally, the Tribunal is satisfied the Landlords have not breached their obligations under section 63 of the RTA. The Tribunal finds the Landlords complied with the obligations created by section 63 to provide and maintain the premises in a reasonable state of repair having regard to the age of, rent payable for and prospective life of the premises.
If I am wrong in that finding, the Tenant's claim for compensation for a breach of section 63 of the RTA is out of time. The Tenant did not file an application for an order in relation to the residential tenancy agreement within 3 months after she became aware of the breach.
The Tenant reported the issue with dead trees lining the property in or about March 2022. The Tenant requested the Landlords remove the dead trees. The Landlords neglected or refused to act to remove them.
The Landlords assert it is the Tenants responsibility to maintain the garden. The Tenant has not established a breach of the tenancy agreement or the RTA by the Landlords.
The Tenant has not proved her case for compensation and the claim is dismissed. Additionally, any claim based on a breach of the Act is out of time for the same reasons set out above.
The Tenant contended the Landlords did not maintain the gravel driveway. The Tenant advised the agent on 24 August 2021 of the poor state of the driveway. The last report was on 24 August 2022.
As with the previous claim, the Tenant has not proved a breach of the RTA and the claim is dismissed. If there was a breach, any claim for compensation is out of time.
The Tenant has not proved her case on the balance of probabilities. Each of the Tenant's claims for compensation are dismissed.
For the above reasons, the Tenant's application for various orders is dismissed.

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 DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 20 December 2024

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Judgment (10 paragraphs)

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