Bruno v Bruno [2023] SACAT 78

The respondent landlord submitted that it was always his intention that this agreement constituted a tenancy agreement and that he would evict the tenant if she was in breach, despite their relationship as father and daughter. The applicant tenant made no submissions and the Tribunal proceeded to hear the matter in her absence, being satisfied that she was aware of the hearing and chose not to participate.

Held, granting leave and affirming the decision under review:

• there was an intention to create legal relations when the parties first entered into the agreement, and the agreement is a binding contact between the parties;
• the agreement between the parties is a residential tenancy agreement;
• in the circumstances of this matter there can be no order other than vacant possession;
• the Tribunal affirms the decision under review and varies the vacate date to Wednesday 23 August 2023.

Internal review - Residential Tenancy - Landlord application - Termination and vacant possession - Breach of agreement - Rent arrears

South Australian Civil and Administrative Tribunal Act 2013 ss 43, 70, 83

Residential Tenancies Act 1995 ss 3, 24, 64, 87, 92A

Tronnolone v Edwards and Bryan [2016] SACAT 27

Balfour v Balfour [1919] 2 KB 571

Cohen v Cohen [1929] HCA 15; (1929) 42 CLR 91

Upper Hunter County District Council v Australian Chillling & Freezing Co Ltd [1968] HCA 8; (1968) 118 CLR 429

McColl v Hearse [2016] SACAT 38

Radaich v Smith [1959] HCA 45; (1959) 101 CLR 209

Henderson v Housing Choices South Australia Ltd [2019] SASC 121

The respondent appeared in person supported by Ms P Bruno and Mr A Moore

1. This is an application for the internal review of an order made by the Tribunal on 31 March 2023 in matter number 2023/SH000426 (the original Order).
2. In the original Order, the Tribunal dealt with an application by the respondent landlord Mr Bruno, seeking an order for vacant possession on the basis of the applicant tenant (Ms Carmel Bruno - Ms Bruno)'s failure to pay rent, and a notice of termination served giving 60 days' notice for Ms Bruno to vacate the property situated at Old Honeypot Road Noarlunga Downs (the property). The original Order required Ms Bruno to vacate the property on 31 May 2023. Ms Bruno continues to reside in the property.
3. Ms Bruno disagrees with the original Order and she has sought a review.
4. An application for internal review is made under s 70 of the South Australian Civil and Administrative Review Act 2013 (the SACAT Act). Section 70 of the SACAT Act requires that on review, the Tribunal must make the correct or preferable decision taking into account the evidence before the Tribunal at the original hearing, giving appropriate weight to the original Order, and taking into account any evidence the Tribunal considers is relevant and appropriate to take into account in the course of the review process. An application for review necessarily involves an application for leave.

The lateness of the lodgement of the application

1. The application for internal review was lodged on 29 May 2023. Section 70(2) of the SACAT Act requires that an application for internal review must be lodged within one month of the decision under review unless the Tribunal considers it is just and reasonable for the Tribunal to accept the application after that time.
2. In the circumstances of this matter, and for reasons which are explained later in this decision, I have decided to dispense with the requirement for the application to have been lodged within 1 month of the original Order.

1. Notice of the hearing was sent to Ms Bruno by email on 4 July 2023. The email address had been provided to the Tribunal by Ms Bruno. In addition, Ms Bruno should have received an SMS message from the Tribunal's computer system within 24 hours of the hearing (that message would have been sent to the mobile phone number provided by Ms Bruno when she lodged the application for review). Ms Bruno did not attend at the Tribunal. I attempted to phone her three times over a period of 15 minutes, and during that period I asked the case officer to send her an email requesting her to answer her phone. Ms Bruno did not take the call on any occasion, however, it appeared to me that she did pick up the phone on the third call and she then hung up.
2. Mr Bruno informed me that he had received a text message shortly before the hearing from Ms Bruno, telling him not to bother coming to the hearing because she had "cancelled" it, and she was still making enquiries about a loan. He confirmed that was from the number on the Tribunal file.
3. Accordingly, I am satisfied that Ms Bruno was aware of the hearing but chose not to participate. I asked the case officer to search the Tribunal's inbox to ensure that no message had been received from Ms Bruno about the hearing but it had not.
4. I decided to proceed with the hearing in the absence of Ms Bruno.[1]

1. When Ms Bruno lodged her application for internal review, she also lodged an application for the original Order to be stayed. An order was made granting a stay on 2 June 2023.
2. A directions hearing was conducted by the Tribunal on 4 July 2023 and directions were issued permitting the parties to lodge further submissions or documents in support of their case. Neither party chose to lodge any further submissions or documents.

1. This dispute is about an arrangement concerning the occupation of the property. Mr Bruno built the property (ie he engaged a builder to construct the house for him).
2. Mr Bruno agreed that Ms Bruno could move into the property on about 1 April 1997. Initially, Ms Bruno and her partner moved into the property. Ms Bruno is the daughter of Mr Bruno. Their personal relationship has broken down and they have very little communication with one another.
3. There was no written residential tenancy agreement. Mr Bruno's position is that the arrangement for Ms Bruno to reside in the property is a residential tenancy agreement. He says that Ms Bruno has been in breach of a number of her obligations as a tenant and he wants her to vacate.
4. Ms Bruno did not participate in the hearing conducted on 31 March 2023. In her application for review, she has said that she and her son will be homeless if they are evicted, and she is currently trying to arrange for a loan to address her rent arrears.
5. Ms Bruno has lodged no documents in support of her application.

1. I will deal with this application for internal review by considering the following questions:
   • Does the arrangement between the parties constitute a residential tenancy agreement?
   • If so, should the tenancy be terminated and should the Tribunal make an order for vacant possession (ie requiring Ms Bruno to vacate)?

Question 1: Does the arrangement between the parties constitute a residential tenancy agreement?

1. In general terms, under s 24(1) of the Residential Tenancies Act 1995 (the RTA) the Tribunal has jurisdiction to deal with disputes arising from either a residential tenancy agreement or a rooming house agreement.[2]
2. A residential tenancy agreement is merely a special form of contract and so ordinary principles of contract law apply subject to the provisions of the RTA.[3] Accordingly, the first question to consider is whether or not there is a binding contract between the parties - if not, there can be no residential tenancy agreement.

Is there a binding contract between the parties?

1. The essential elements of a binding contract are:

• An agreement between the parties - usually this occurs through the process of offer and acceptance;[4]
• Consideration;
• An intention to create legal relations;[5]
• And the agreement must be sufficiently certain in relation to the essential terms of the agreement.[6]

1. I am satisfied from the evidence given by Mr Bruno at the original hearing and at this hearing, that the arrangement between the parties was as follows:
   • Mr Bruno agreed that Ms Bruno could move into the property in April 1997;
   • In return for her right of occupancy, Ms Bruno agreed that she would pay regular amounts into Mr Bruno's bank account to cover the mortgage payments;
   • At the commencement of the arrangement, Mr Bruno calculated what amounts Ms Bruno would be required to pay to cover the mortgage payments;
   • At times during the arrangement, Mr Bruno has asked Ms Bruno to increase her payments due to increases in his mortgage payments;
   • Ms Bruno was also expected to pay for her utilities;

• There was no fixed term agreed - the arrangement was "open-ended".[7]

1. I am satisfied that these arrangements are sufficient to constitute offer and acceptance, an agreement on the essential terms of the agreement and consideration. I am also satisfied that there was agreement on the essential terms of the arrangement.
2. At the review hearing, I explained to Mr Bruno that where there is an agreement between family members, the presumption is that it is not intended to be legally binding unless the parties have agreed otherwise. Mr Bruno gave evidence to me that when the agreement was put into place, his intentions were that the agreement would constitute a tenancy agreement. He said that his position had been that if Ms Bruno was in breach of her obligations as a tenant, depending on the seriousness of the breach, he would not permit her to remain in the property and he would take action to have her evicted. Mr Bruno acknowledged that he has not taken action about relatively minor breaches by Ms Bruno in the past (such as a failure to pay for water invoices). He explained that even though Ms Bruno has been in breach of her obligations to pay rent and to maintain the property in a reasonable condition, it was only when he realised the extent of her breach in relation to the payment of rent that he decided to initiate proceedings in the Tribunal.
3. Therefore, I am satisfied that there was an intention to create legal relations when the parties first entered into the agreement, and I am satisfied that the agreement is a binding contact between the parties.

Is the agreement between the parties a residential tenancy agreement?

1. Simply because the arrangement between the parties is a binding agreement/contract, does not necessarily mean that it is a residential tenancy agreement. The Tribunal may only deal with this dispute if it arises from a residential tenancy agreement.
2. As I have noted, in South Australia, the specific requirements for a residential tenancy agreement are contained in the RTA.
3. The term "residential tenancy agreement" is defined in s 3(1) of the RTA to mean "an agreement ... under which a person grants another person, for valuable consideration, a right ... to occupy premises for the purpose of residence".[8]
4. In my view, there are two particular requirements to be met if the agreement between Mr Bruno and Ms Bruno is to be properly characterised as a residential tenancy agreement: first, Ms Bruno must have the right of exclusive occupation of the premises; second, she must have agreed to pay rent.

1. In general terms, a person who has been given the right to reside in a property by the owner, will be either a licensee or a tenant. The most significant factor in determining whether or not the occupant has been granted a mere licence to occupy, or the rights of a tenant, is the issue of exclusive possession.[9] The necessity for exclusive possession is recognised by s 64 of the RTA.
2. In many cases, this issue would not be contentious, however, in this matter I consider it should be specifically addressed, due to the father/daughter relationship between Mr Bruno and Ms Bruno, which raises the possibility that Ms Bruno may not have been granted exclusive occupation.[10] During the hearing conducted by Senior Member Ward on 31 March 2023 Mr Bruno gave evidence that for the entire tenancy, his practice was that he would not enter the property without proper notice to Ms Bruno and in fact, Ms Bruno had denied him access for an inspection when he attempted to obtain access (pursuant to a notice). In that hearing, Mr Bruno said that for that reason, he had not been able to gain access to the property for some time.
3. For these reasons, I am satisfied that the agreement between the parties did grant exclusive possession of the property to Ms Bruno.

1. In the matter of McColl v Hearse, his Honour Justice Parker made the following statement about the particular requirements of the RTA in relation to the issue of rent:[11]
   1. The concept of "valuable consideration" has been defined to mean "some right, interest, profit or benefit accruing to one party, or some forbearance, detriment, loss or responsibility given, suffered or undertaken by the other". That definition makes clear that valuable consideration may be something other than the payment of money or a promise to pay money.
   2. At common law it was not necessary that rent be paid in money. Rent might be paid by way of services, such as ploughing the owner's land, or the provision of crops or livestock. That definition is somewhat narrower than that of "valuable consideration". Thus, for example, an act of forbearance would constitute valuable consideration but would not appear to be rent at common law.
   3. It is also necessary to consider whether the RT Act has departed from the common law meaning of rent. The term "rent" is defined in s 3(1) to consist of "(a) the amount payable under a residential tenancy agreement for the right to occupy premises for a period of the tenancy". While the definition also includes a paragraph (b), that clearly does not apply in the present situation.
   4. I consider that the meaning of "rent" has been narrowed under the RT Act from that which applied at common law. That is because the reference to "the amount payable" clearly contemplates the payment of money rather than any other form of valuable consideration. If that was not the case, paragraph 5(1)(d) would be largely, if not entirely, otiose.
2. The arrangements between the parties about the payment of rent were not the arrangements which would usually be made in a residential tenancy agreement. Nevertheless, I am satisfied from Mr Bruno's evidence, that there was an agreement between the parties by which Ms Bruno was required to make regular payments of rent by means of a deposit into his bank account. The precise amount of those payments had been agreed between the parties at the outset of the agreement, and was varied by agreement from time to time.
3. I accept that Ms Bruno has not paid rent for a number of years. Even though it has taken an unusual period of time (about 10 - 12 years), for Mr Bruno to become aware of the default,[12] I am satisfied that Mr Bruno never made a decision to absolve Ms Bruno of her obligation to pay rent, he never made a decision to waive his right to recover rent arrears from her, and he never agreed that she could cease paying rent. I accept that he was slow to take action for the eviction of Ms Bruno because she is his daughter.
4. Therefore, I am satisfied that rent was payable under the agreement consistent with the requirements of the RTA.
5. For these reasons, I agree with the decision in the original Order that the agreement between the parties is a residential tenancy agreement.

Question 2: Should the tenancy be terminated, and should the Tribunal make an order for vacant possession (ie requiring Ms Bruno to vacate)?

1. In the original Order, Senior Member Ward found that the notice of breach in relation to rent arrears and outstanding water invoices (Form 2) was invalid and ineffectual. I agree that the notice was ineffectual as an application was not made to the Tribunal within one month of the day on which Ms Bruno was required to vacate.[13]
2. Senior Member Ward also found that the notice of termination served by Mr Bruno (Form 3) was invalid as it did not specify a date on which Ms Bruno was required to vacate. I agree with that finding.
3. Nevertheless, Senior Member Ward proceeded to deal with the application for vacant possession and I consider this was the correct approach either on the basis of the Form 3 notice of termination,[14] or on the basis that Ms Bruno was in serious breach of her obligations as a tenant.[15]
4. Even though Mr Bruno's records in relation to rent are inadequate, I accept his oral evidence that but for a short period last year, Ms Bruno failed to pay rent for many years. This is a serious breach. It has been acknowledged by Ms Bruno who has communicated with Mr Bruno to the effect that she is trying to obtain a loan to address her rent arrears.
5. In today's hearing, Mr Bruno said that he had given Ms Bruno many warnings that she needed to pay rent and she needed to address the poor condition of the property, but she had not addressed those issues.
6. In today's hearing, Mr Bruno and Ms Pamela Bruno said that even though the original Order required Ms Carmel Bruno to vacate the property on 31 May 2023, and even though she continues to not pay any rent, they want to allow her some further time to vacate the property.

1. In the circumstances of this matter I consider that there can be no order other than vacant possession. I consider that the position of Mr Bruno and Ms Pamela Bruno is extremely fair.
2. Therefore, I will affirm the decision under review but vary the vacate date.
3. Ms Bruno will be required to vacate the property on Wednesday 23 August 2023. In order to give effect to this variation, I will extend the time within which the application for review can be made.

1. The Tribunal dispenses with the strict requirement for the application for internal review to be lodged within one month of the decision under review.

2. The Tribunal grants leave for the internal review.

3. Subject to Order 4, the Tribunal affirms the decision under review.

1. The Tribunal varies the Tribunal order made on 31 March 2023 in matter number 2023/SH000426 by deleting the orders and substituting the following orders instead:

a) The tenancy will terminate at midday on Wednesday 23 August 2023. If the tenant does not move out this order may only be enforced by the Tribunal bailiff. > > b) On Wednesday 23 August 2023 all outstanding rent and water invoices become immediately due and payable.

[1] Pursuant to s 43(2)(f) of the SACAT Act.

[2] There is no suggestion that the arrangement between the parties is a rooming house agreement.

[3] Tronnolone v Edwards and Bryan [2016] SACAT 27 at paragraph 14.

[4] Cheshire and Fifoot's Law of Contract 8th Australian Edition at para 3.2.

[5] Balfour v Balfour [1919] 2 KB 571; Cohen v Cohen [1929] HCA 15; (1929) 42 CLR 91.

[6] Upper Hunter County District Council v Australian Chillling & Freezing Co Ltd [1968] HCA 8; (1968) 118 CLR 429.

[7] In effect, this is a periodic tenancy.

[8] A residential tenancy agreement does not need to be in writing.

1. [9] Radaich v Smith [1959] HCA 45; (1959) 101 CLR 209 at p 213 (Dixon CJ), 214 (McTiernan J), 217 (Taylor J), 221 (Menzies J), 222 (Windeyer J).
2. [10] See also Peek J in Henderson v Housing Choices South Australia Ltd [2019] SASC 121 at paragraphs 85 - 88.
3. [11] [2016] SACAT 38 - without footnotes.
4. [12] It appears that Mr Bruno had a draw down facility with his bank in relation to which he did not receive regular statements, and the bank had simply been increasing the amount drawn down under the facility each time a payment was not received from Ms Bruno and without notifying Mr Bruno. If this is the case then it may be an issue for Mr Bruno to pursue with his bank but it does not impact on the issue of rent payable under the agreement by Ms Bruno.

[14] Pursuant to s 83 of the SACAT Act.