Bladen v Mifsud

REASONS FOR DECISION

1. Residential tenants, Victoria Bladen and Kevin Bridgford, have appealed from a decision of the Consumer and Commercial Division of the Tribunal on 28 February 2020 to refuse to set aside an earlier decision of the Tribunal to terminate the residential tenancy agreement between the tenants and the landlords, Kelena and Peter Mifsud, under s 87 of the Residential Tenancies Act 2010 (NSW) (RT Act). The tenants argue that they were denied procedural fairness in the making of the decision.
2. For the reasons that follow, we have decided that the Tribunal did not deny procedural fairness to the tenants, nor is a case made out that leave to appeal the Tribunal's set aside decision should be granted on the basis that a substantial miscarriage of justice may have occurred in the making of that decision. Accordingly the appeal should be dismissed.

Background in relation to appeal

1. Ms Bladen and Mr Bridgford entered into a residential tenancy agreement with the Mifsuds, effective 25 September 2018. On 17 January 2020, the landlords applied to the Tribunal for a termination order under s 87 of the RT Act in respect of the tenancy, on the basis that the tenants had breached the agreement for example for non-payment of rent (original application).
2. At the time of making the original application, the landlords alleged that the tenants were $3,764.28 in arrears. The original application was determined by the Tribunal on 5 February 2020 (original decision).
3. The Tribunal decided to terminate the residential tenancy agreement under s 87 of the RT Act, with immediate effect. The Tribunal made an order for possession of the premises, payment of a daily occupancy fee from 6 February 2020 until vacant possession was given, and an order that the tenants pay the landlords rental arrears which, by the time of the original decision, amounted to $5,264.
4. It is apparent from the Tribunal's reasons that Mr Bridgford attended the hearing on 5 February 2020 on behalf of the tenants, and that he was removed from the hearing by the Sheriff, at the request of the presiding Member.
5. The Member's reasons for doing so were recorded at [5] to [8] of the reasons for the original decision, as follows: 5. Kevin Bridgford declined to sit at the bar table. He stated that he was entering the dock under duress. He challenged the Tribunal's jurisdiction. He wore a T-shirt with the words GO FUCK YOURSELF across the front. The Tribunal has since learned that he was advised by the representative from VERTO to remove or reverse the T-shirt, but refused. 6. The legal basis for the assertions made by Kevin Bridgford was not apparent. He made references to unspecified High Court decisions, the Constitution of the Commonwealth of Australia, the fact that NCAT had an ABN, and was therefore a corporation that could neither make nor enforce law, and whether this system of government in New South Wales or Australia was lawful under common law. His statements were a rambling mixture of quotes and assertions which neither literally nor legally made any sense. Kevin Bridgford refused to listen to any explanation offered by the Tribunal. Kevin Bridgford continually asserted that the Residential Tenancies Act of NSW was not valid because it had not received Royal assent in accordance with the Constitution of the Commonwealth of Australia. The Tribunal was not able to identify any lawful basis for Kevin Bridgford's assertion that NCAT lacks jurisdiction in residential tenancy matters. 7. Kevin Bridgford was aggressive, loud and constant in his assertions. The Tribunal attempted to explain the law and the process to Kevin Bridgford and invited him to participate in the hearing of the application. On several occasions the Tribunal asked Kevin Bridgford to take part in the hearing, noted that this was a serious matter, where the lessors were requesting an order terminating the tenancy. Kevin Bridgford refused to listen to the Tribunal, refused to be [quiet] and kept interrupting. Kevin Bridgford was advised that if he did not be [quiet] he would be removed from the room. 8. Kevin Bridgford persisted with his conduct and I formed the view that it was not possible to continue with the hearing [with] Kevin Bridgford in the hearing room. The sheriff removed Kevin Bridgford from the courtroom.
6. The Member noted in the reasons for decision at [11] that Mr Bridgford later conveyed an application to adjourn the hearing via the Sheriff, which was refused. A notation to the orders made on 5 February 2020 stated that "Mr Bridgford was given an opportunity to participate in the hearing, he was aware of the serious nature of the application being for termination and possession, the amount of arrears is high and the matter should proceed to avoid further detriment to the lessors."
7. At [12] of its reasons, the Tribunal expanded on this and noted that it had considered and weighed the following factors, when deciding not to adjourn at the request of Mr Bridgford: 1. the tenants are well acquainted with the residential tenancy law and the processes of the Tribunal; 2. the serious nature of an application to terminate a tenancy and the consequences of eviction for a family; 3. the high amount of arrears claimed in the application and the serious financial consequences for the landlord should rent continue unpaid; 4. the obligation of the Tribunal to facilitate the just, quick and cheap resolution of the real issues in the proceedings; and 5. Mr Bridgford had attended the Tribunal hearing, was aware of the application for termination, had been encouraged to participate but had chosen to disrupt the proceedings rather than take part.
8. In terminating the tenancy on 5 February 2020, the Tribunal said that it had before it material including a rent schedule to show rent had not been paid; a valid termination notice dated 2 January 2020; a statutory declaration relating to service of the notice of termination; and a copy of the managing agent's notations showing how many times the tenants were reminded of their rental arrears since 2 December 2019 (date of commencement of rent arrears). As at 5 February, the tenants were 67 days behind in rent, in the sum of $5264.29, according to the landlords' evidence: reasons for the original decision, [15].
9. By application lodged 19 February 2020, Ms Bladen on behalf of the tenants applied to have the original decision set aside under cl 9 of the Civil and Administrative Tribunal Regulation 2013 (NSW) (the Regulation) on the basis that the decision was made in the absence of a party and that party's absence resulted in the party's case not being adequately put to the Tribunal: the Regulation, cl 9(1) (b). The tenants did not apply to set aside the original decision within seven days as required by cl 9(3). They requested an extension of time for the filing of the application on the basis that they had not received the decision of the Tribunal until 17 February 2020.
10. The grounds for setting aside the decision, as detailed by the tenants in their application, were as follows: "Mr Kevin Bridgford attended the hearing as the representative for the [tenants] and was removed from the room by the Sheriff at the request of the member with no definitive reason given and no understanding of why this happened. From the representative's recollection it may have been as the member said and I quote "your shirt is offensive" and "you are a very offensive man." It may have been the perceived bias from having appealed a previous decision and having that decision overturned".
11. In providing a summary of the case (the evidence and arguments) which the tenants say they would have put to the Tribunal had Mr Bridgford not been absent from the hearing, the tenants indicated: "[H]aving been denied procedural fairness by not seeing any evidence shown to the member or submitted on the day of conciliation is ambiguous to know (sic) what evidence or submissions could have been made to counter any claims. Therefore, these orders made in an unjust hearing are a substantial miscarriage of justice. All that the applicants ask for is the fair and equitable hearing that was denied to them."
12. On 21 February 2020, the Tribunal made orders and gave directions, staying the operation of the orders for termination and possession of the premises, providing the landlords an opportunity to make submissions in reply to the tenants' submissions on the set aside application by 25 February, and for the tenants to have an opportunity to provide submissions in reply by 27 February. The Tribunal also directed the landlords to provide an up to date rental ledger and the tenants to provide evidence of any rent payments not accounted for on the ledger.
13. The Tribunal made it clear to the parties in a notation to the orders and directions of 21 February 2020 that the tenants would not be required to vacate the premises if they paid the outstanding rent prior to execution of any warrant for possession, a reference to the combined effect of ss 89 (3), (5) & (6) of the RT Act which is that, unless the Tribunal finds that the tenant has frequently failed to pay rent, the termination of the tenancy and any warrant for possession would cease to have effect if the outstanding rent was paid.
14. The application to set aside the original decision was decided on 28 February 2020 (the set aside decision). Whilst the Tribunal extended time for the filing of the application, the application was dismissed and the stay granted on 21 February 2020 was set aside.
15. The Tribunal's reasons on the set aside application record that it was satisfied that the absence of the tenants at the entire hearing of the original application resulted in their case not being adequately put to the Tribunal and that the Tribunal had jurisdiction to determine the set aside application under cl 9(1)(b) of the Regulation.
16. The Tribunal did not, however, exercise its discretion to set aside (or vary) the original decision. The Tribunal dismissed the application because "although the orders were made in the absence of the applicant, and the Tribunal is satisfied that the party's absence resulted in their case not being adequately put to the Tribunal, in the exercise of discretion the Tribunal is not satisfied that there was a real likelihood that it would be unjust to let the decision stand". After having considered the evidence and submissions provided by the parties in accordance with the directions made on 21 February, the Tribunal based the exercise of its discretion on the following findings: 1. Mr Bridgford (representing himself and his co-tenant) was present at the hearing of the original application and was, for the reasons given by the presiding Member, removed from the hearing prior to the orders being made; 2. the landlords had provided evidence indicating that the rental arrears in the sum of $5,264 was correct as at 5 February 2020. 3. the tenants had not paid the daily occupation fee of $64.29 ordered in the original decision. 4. the evidence indicated that the rental arrears and occupation fee outstanding as at 25 February 2020 were in the sum of $6,578.65; 5. despite the specific invitation to the tenants on 21 February, they had not provided evidence of any rent payments not accounted for on the rent ledger.
17. In recording its decision, the Tribunal again referred the tenants to the fact they would not have to vacate the premises if they paid the outstanding rent.

Notice of Appeal and request for stay

1. On 5 March 2020, the tenants lodged a Notice of Appeal against the set aside decision, within time. They challenge the orders which dismissed the set aside application and lifted the stay on the termination and possession orders.
2. Their grounds of appeal are that they had been denied procedural fairness and "the right to a fair hearing".
3. They also allege that the Tribunal used a rent ledger that was not complete or up-to-date in determining the set aside application and that the respondents had not served documents on the tenants pertaining to the appointment by the landlords of a new managing agent.
4. The tenants also seek leave to appeal on the basis that they have suffered a substantial miscarriage of justice as the decision was not fair or equitable because the applicants were denied procedural fairness "as the Tribunal has found that the orders were made in the absence of the applicants"; and that the decision was against the weight of evidence. They alleged that the Tribunal should have given more weight to alleged contradictions in the rental ledger which they say indicated that two different amounts were owing as at the same, unspecified, date. They allege that there was no evidence provided by the landlords as to the commencement date of the residential tenancy agreement and no evidence that the landlords' agent complied with s 27 of the RT Act, in that they allegedly failed to notify the tenants of a change to the managing agent of the property.
5. The tenants filed a stay application with their Notice of Appeal. The stay was granted by the Appeal Panel (constituted by S Westgarth, Deputy President) on 5 February 2020, on condition that the tenants pay to the landlords the sum of $4,000 by 6 March 2020. The Appeal Panel ordered the landlords to file and serve a complete rent ledger and directed that the tenants may file and serve submissions and evidence in reply to the evidence of the respondent by 11 March 2020.
6. In response to those directions the landlords filed further material, including a statutory declaration relating to the outstanding rent, a rent ledger and notices provided to the tenants under s 27 of the RT Act. The evidence of the landlords included that the tenants had not paid the $4,000 on which the stay was conditional or any other amount toward rent or the occupation fee.

Issues on appeal

1. Prior to the appeal hearing, the parties were notified that the appeal would take place by telephone link due to the COVID-19 pandemic. There was ultimately no objection to this course. Despite some initial reluctance to proceed by telephone hearing rather than in person, after some discussion the tenants agreed that they were in a position to proceed with the hearing. They abandoned a foreshadowed application for an adjournment.
2. The tenants may bring an internal appeal against the set aside decision as of right on a question of law or with leave on any other ground: s 80(2)(b), Civil and Administrative Tribunal Act (NSW) 2013 (NCAT Act) (see also Hammond v Ozzy's Cheapest Cars Pty Ltd t/as Ozzy Car Sales [2015] NSWCATAP 65 at [26] & [40].)
3. The issues for the Appeal Panel are: 1. whether there has been a denial of procedural fairness by the Tribunal in the making of the set aside decision such that the set aside decision should be overturned, and 2. if not, whether leave to appeal on grounds other than a question of law should be granted because a substantial miscarriage of justice may have occurred in the set aside decision by reason that the set aside decision was not fair and equitable or was against the weight of evidence, and if so, whether any such grounds are made out.
4. The material before us, including the submissions of the parties, indicates there has been some confusion about whether the appellant tenants sought to appeal the original decision, or only the making of the set aside decision. The tenants confirmed at the appeal hearing that they appeal against the set aside decision only.

Tribunal's power to set aside decisions

1. Clause 9 of the Regulation provides relevantly as follows: 9 Additional power to set aside or vary decision determining proceedings (1) In addition to any power that is expressly conferred on the Tribunal by the Act or enabling legislation to set aside or vary its decisions, the Tribunal may order that a decision it has made that determines proceedings be set aside or varied in either of the following circumstances: … (b) if the decision was made in the absence of a party and the Tribunal is satisfied that the party's absence has resulted in the party's case not being adequately put to the Tribunal. … (4) Except where the parties have consented to the making of the order, the Tribunal may not make an order under this clause unless the Tribunal has first: (a) afforded the parties an opportunity to make submissions about the proposed order, and (b) taken any such submissions into account.
2. The power of the Tribunal to set aside Tribunal decisions under cl 9(1)(b) has been previously examined in Appeal Panel decisions including Hammond v Ozzy's Cheapest Cars [2015] NSWCATAP 65, Matthew Bryan v Lilly Gorgievski and Les Gorgievski [2015] NSWCATAP 186 and Kostov v Ecclesia Housing Limited (No 2) [2018] NSWCATAP 215.
3. Before the Tribunal's power to set aside a decision that determines proceedings arises, the Tribunal must be satisfied that: 1. The decision was made in the absence of a party; and 2. That absence resulted in the party's case not being adequately put to the Tribunal.
4. If those two requirements are satisfied, the Tribunal then has a discretion to set aside or vary the decision. As explained in Hammond v Ozzy's Cheapest Cars [2015] NSWCATAP 65 at [65], this follows from: 1. The use of the word "may" in the chapeau to cl 9(1); 2. The terms of s 53(3) of the Act, having regard to the reasoning of Basten JA in Atkinson v Crowley [2011] NSWCA 194 at [12]-[13] in relation to a similar provision in the legislation which applied to the Consumer Trader and Tenancy Tribunal, before it was abolished; and 3. The fact that cl 9(1)(b) applies in situations extending beyond those in which it might be held that the proceedings are a nullity (see, for example, Hoskins v Van Den-Braak (1998) 43 NSWLR 290 at 294 and the authorities there cited).
5. In deciding whether to exercise that discretion, the Tribunal must have regard to what was stated in Hammond v Ozzy's Cheapest Cars [2015] NSWCATAP 65 at [80]: "In summary, when exercising the discretion conferred by cl 9(1)(b), the Tribunal should direct its attention to whether there would be a real likelihood of injustice if the decision was allowed to stand. Relevant considerations will generally include: (1) Why the party was absent and whether the absent party had a reasonable opportunity to be heard or otherwise have its submissions considered in the proceedings; and (2) Whether the absent party has an arguable defence or an arguable case that a different decision could have been reached."

Making of set aside determination

1. The tenants' application to set aside the decision of 5 February 2020 was considered by the Tribunal "on the papers", that is, without a hearing. That course was permitted by cl 9(8) of the Regulation and s 50(1)(d) of the NCAT Act. The tenants do not raise any issue with the set aside application having been determined on the papers.
2. The form of the Application to Set Aside or Vary a Decision of the Tribunal advises an applicant, under the heading "IMPORTANT INFORMATION", that "This application may be determined on the papers, without an oral hearing. Provide as much information and documentation supporting your application as possible. Attach additional pages to this application if needed."
3. Further, we note that NCAT provides some guidance to parties and the public on its website, as follows : Set aside or vary decision NCAT can make orders to set aside (overturn) or vary (change) a final decision under clause 9 of the Civil and Administrative Tribunal Regulation 2013. You can apply to set aside or vary a Tribunal decision in either of the following circumstances: 1. All parties agree that the decision should be set aside or varied, or 2. You could not attend the hearing and your case was not adequately put to the Tribunal. Set aside or vary decision applications must be lodged within 7 days after the decision was made Refer to Clause 9 of the NCAT Regulations for more details. You may want to seek legal advice before making an application. How is the application decided? NCAT decides set aside or vary decision applications 'on the papers' without a hearing. Provide as much information and documentation supporting your application as possible. Application is granted If your application is granted, NCAT will tell you in writing and issue new notices of hearing. The original application will be dealt with by the Tribunal as a fresh hearing. A successful application to set aside or vary a decision does not mean that you will be successful at the next hearing. Application is refused If your application is refused, the original orders will remain in full force and effect. If a stay order was granted with your application, the stay will be lifted and the previous orders will become effective immediately.
4. Before making an order to grant or refuse a set aside application under cl 9, cl 9(4) requires the Tribunal to have first afforded the parties an opportunity to make submissions about proposed orders and take such submissions into account.

Was there a breach of procedural fairness by the Tribunal that led to practical injustice?

1. A decision by the Tribunal to grant or refuse a set aside application will be overturned where the Tribunal has denied procedural fairness to a party in the making of that decision, and where that denial of procedural fairness has worked a "practical injustice" to the party. In Re Minister for Immigration and Multicultural and Indigenous Affairs; ex parte Lam (2003) 214 CLR 1, Gleeson CJ said at [37]: "Whether one talks in terms of procedural fairness or natural justice, the concern of the law is to avoid practical injustice".
2. As has been stated by an earlier Appeal Panel in Matthew Bryan v Lilly Gorgievski and Les Gorgievski [2015] NSWCATAP 186 citing House v The King (1936) 55 CLR 499 at 505-506, the exercise of a statutory discretion such as deciding whether to grant or refuse a set aside application should only be overturned in limited circumstances. This would include errors by the Tribunal in acting upon a wrong legal principle, allowing extraneous or irrelevant matters to guide or affect the decision, making a material factual error, or failing to take into account some material consideration.
3. The Appeal Panel will not readily overturn a decision where the Tribunal commits an error of law in the way it proceeded to determine a set side application but the error did not made a difference to the ultimate outcome. A decision will be set aside only where an error of law was material in the sense that it "might" or "may" have made a difference: Australian Broadcasting Tribunal v Bond (1990) 170 CLR 321 at 353 per Mason J and 384 per Toohey and Gaudron JJ, and other authorities cited in Hijazi v Commissioner of Police, NSW Police Force [2015] NSWCATAP 82 at [83]; Matthew Bryan v Lilly Gorgievski and Les Gorgievski [2015] NSWCATAP 186 at [42].
4. The tenants contend that the Tribunal failed to afford them procedural fairness, or the right to a fair hearing, in determining the set aside application. Denial of procedural fairness, if made out, is an error of law for which no leave to appeal is required. The tenants do not raise any other questions of law.
5. The tenants' initial position in arguing the appeal was that they should have been allowed a hearing of the original application which they could participate fully in, but having accepted that Mr Bridgford's absence from most of the hearing resulted in the tenants' case not being adequately put to the Tribunal in the original application, that was not the issue before the Tribunal on the set aside application.

Should leave to appeal be granted because a substantial miscarriage of justice may have occurred?

1. In appeals from a decision of the Consumer and Commercial Division, an Appeal Panel may only grant leave to appeal on a ground which does not raise a question of law if satisfied that the appellant may have suffered a substantial miscarriage of justice because the decision of the Tribunal under appeal was not fair and equitable, the decision was against the weight of evidence, or significant new evidence has arisen (cl 12(1) of Sch 4, NCAT Act). In addition, an appellant must also demonstrate that leave to appeal should be granted on general discretionary grounds.
2. At the hearing before us the tenants confirmed that, whilst they had indicated in the Notice of Appeal that they sought leave to appeal, their only ground was their argument that they were denied procedural fairness, an error on a question of law for which no leave is required, which we have dealt with, above.
3. Notwithstanding that, we have considered whether there is any other basis on which a substantial miscarriage of justice may have occurred.
4. Despite their brevity, the reasons for the set aside decision indicate that "in the exercise of discretion the Tribunal is not satisfied that there is a real likelihood that it would be unjust to let the decision stand". That discretion was exercised after the Tribunal made relevant findings that the tenants were in significant rental arrears when the original decision was made and at the time of the set aside application. There was no probative evidence before the Tribunal to contradict those findings. Nor was there significant new evidence put before us to call those findings into question. It cannot be said, on that basis, that the terms of clause 12 of Sch 4 to the NCAT Act are engaged.
5. Whilst it would undoubtedly have been beneficial for the understanding of the parties if relevant legislation and case law had been cited in the written reasons, we are nonetheless satisfied that the Member relied on well-established legal principles concerning the exercise of the discretion in cl 9(1)(b) of the Regulation: see e.g. Hammond v Ozzy's Cheapest Cars [2015] NSWCATAP 65. Indeed, the words used by the Tribunal echo that decision of the Appeal Panel in describing the 'central question' to be considered, at [76]. We are mindful that the obligation of the Tribunal in giving reasons is not to record the relevant law verbatim, but its understanding of it: NCAT Act, s 62(3)(b).

Orders 1. Leave to appeal on grounds other than a question of law is refused. 2. The appeal 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: 08 May 2020