Chiangwong v Dragon Phoenix Australia Pty Ltd ATF Dragon Phoenix Family Trust

NCAT Appeal Panel|2021-06-09|Before: Blake AM

Introduction

This is an appeal from a decision of the Tribunal in a residential tenancy dispute awarding the landlord $14,155 for rent arrears during the period from 10 July 2020 to 26 October 2020.
In this decision, the appellants are referred to as "the tenants" and the respondent is referred to as "the landlord".
The landlord had taken proceedings in the Tribunal seeking payment of rent arrears under ss 187 and 190 of the Residential Tenancies Act 2010 (NSW) ('the RT Act"). There was no other issue for determination by the Tribunal. The bond had been previously paid by NSW Rental Bond Services to the landlord. The tenants had not taken proceedings in the Tribunal under s 175 of the RT Act in respect of the bond.
The Tribunal hearing occurred on 17 March 2021. The Member gave written reasons for the decision.
The tenants filed the appeal on 31 March 2021. The appeal has been filed within the stipulated time period in r 25 of the Civil and Administrative Tribunal Rules 2014 (NSW).
The residential tenancy agreement between the parties identified the rent payable as $910 per week. The tenancy ended on 26 October 2020. During the period between 25 March 2020 and 26 October 2020 the tenants were paying $500 per week rent.
At the hearing before the Tribunal (and at the hearing before the Appeal Panel) the tenants argued the landlord had agreed to vary the rent payable so that there was an unconditional reduction to $500 per week because the tenants were COVID-19 impacted.
The landlord argued there had been no agreement to reduce the rent.
The Tribunal found that there had been no binding mutual agreement by the parties for the rent to be unconditionally reduced to $500 per week, and the tenants had unilaterally decided to pay that amount.
The issue in the appeal is whether the Tribunal made any error of law, or any other error for which leave to appeal should be granted, in its finding that there had been no binding mutual agreement to unconditionally reduce the rent.

Scope and Nature of Appeals

Internal appeals may be made as of right on a question of law, and otherwise with leave (that is, the permission) of the Appeal Panel: s 80(2)(b) of the Civil and Administrative Tribunal Act 2013 (NSW) ("the NCAT Act").
An internal appeal is not a re-hearing of the original proceedings or a mere opportunity for a party dissatisfied with the outcome in the original proceedings to re-argue its case (Ryan v BKB Motor Vehicle Repairs Pty Ltd [2017] NSWCATAP 39 at [10]). To succeed in an appeal, the appellant must establish an error of law has occurred; or otherwise an error of the type that it is appropriate to grant leave to appeal.
The circumstances in which the Appeal Panel may grant leave to appeal from decisions made in the Consumer and Commercial Division are limited to those set out in cl 12(1) of Sch 4 to the NCAT Act. In such cases, the Appeal Panel must be satisfied that the appellant may have suffered a substantial miscarriage of justice on the basis that: 1. The decision of the Tribunal under appeal was not fair and equitable; or 2. The decision of the Tribunal under appeal was against the weight of evidence; or 3. Significant new evidence has arisen (being evidence that was not reasonably available at the time the proceedings under appeal were being dealt with).
In Collins v Urban [2014] NSWCATAP 17 ("Collins"), the Appeal Panel stated at [76] that a substantial miscarriage of justice for the purposes of cl 12(1) of Sch 4 to the NCAT Act may have been suffered where: "… there was a 'significant possibility' or a 'chance which was fairly open' that a different and more favourable result would have been achieved for the appellant had the relevant circumstance in para (a) or (b) not occurred or if the fresh evidence under para (c) had been before the Tribunal at first instance."
In Collins, the Appeal Panel at [77], without seeking to be exhaustive in any way, stated the authorities establish that: 1. If there has been a denial of procedural fairness the decision under appeal can be said to have been "not fair and equitable" within cl 12(1)(a) of Sch 4 to the NCAT Act; 2. The decision under appeal can be said to be "against the weight of evidence" within cl 12(1)(b) of Sch 4 to the NCAT Act where the evidence in its totality preponderates so strongly against the conclusion found by the Tribunal at first instance that it can be said that the conclusion was not one that a reasonable Tribunal member could reach.
Even if an appellant from a decision of the Consumer and Commercial Division has satisfied the requirements of cl 12(1) of Sch 4 to the NCAT Act, the Appeal Panel must still consider whether it should exercise its discretion to grant leave to appeal under s 80(2)(b) of the NCAT Act.
In Collins, the Appeal Panel at [84(2)] stated that ordinarily it is appropriate to grant leave to appeal only in matters that involve: "(a) issues of principle; (b) questions of public importance or matters of administration or policy which might have general application; or (c) an injustice which is reasonably clear, in the sense of going beyond merely what is arguable, or an error that is plain and readily apparent which is central to the Tribunal's decision and not merely peripheral, so that it would be unjust to allow the finding to stand; (d) a factual error that was unreasonably arrived at and clearly mistaken; or (e) the Tribunal having gone about the fact-finding process in such an unorthodox manner or in such a way that it was likely to produce an unfair result so that it would be in the interests of justice for it to be reviewed."
In Cominos v Di Rico [2016] NSWCATAP 5 ("Cominos"), the Appeal Panel at [13] stated that it may be difficult for self-represented appellants to clearly express their grounds of appeal. In such circumstances and having regard to the guiding principle, it is appropriate for the Appeal Panel to review an appellant's stated grounds of appeal, the material provided, and the decision of the Tribunal at first instance to examine whether it is possible to discern grounds that may either raise a question of law or a basis for leave to appeal.

Grounds of Appeal

The only grounds of appeal were the grounds identified in the Notice of Appeal filed on 31 March 2021.
The appeal grounds did not clearly articulate any error of law. In the grounds of appeal, the tenants acknowledged that at the hearing they did not provide evidence of any reduced income due to the impact of COVID-19. However, the tenants stated that they had now obtained such evidence and sought to rely upon it. The tenants also referred to the bond being paid to the landlord without the consent of the tenants.
In respect of grounds for leave to appeal due to an error other than an error of law, the tenants stated that: 1. The decision was not fair and equitable as: 1. The agent of the landlords told the tenant rent had been reduced to $500 per week and if they had been told they were liable for the full amount of rent arrears they would have terminated the tenancy; 2. The tenants were not notified by the landlord that they owed rent arrears until the landlord took proceedings in the Tribunal; 3. The tenants were "misled" by a letter from the landlord's agent dated 25 August 2020 stating that the tenants owed "1,0940.00" in rent arrears. Due to the error in the letter, the tenants "didn't think much about it" because they thought the rent arrears identified was $1,094, not $10,940; 4. The landlord and the agent "took advantage" of the poor English comprehension of the tenants; 5. The landlord had "withheld" the bond prior to "any findings of the Tribunal". 1. The decision was against the weight of evidence because the tenants "gave evidence that we had a reduced income because of COVID. This is the reason we seek reduction of the rent". The tenants stated that "we would have moved house if the agreement was made clear that the rent reduction was a debt trap".

Documents of the Parties

The Notice of Appeal did not identify any new evidence that the tenants asserted was available that was not reasonably available at the time of the hearing before the Tribunal on 17 March 2021.
However, the tenants filed and served a bundle of documents with the Appeal Panel on 12 May 2021. Included in those documents were a bank statement of Ms Chiangwong for the period between May 2020 and August 2020; text messages between the tenants and the landlord's agent; and an email of the landlord's agent dated 25 August 2020.
The landlord filed and served a Reply to Appeal on 26 April 2021. The landlord also filed and served a bundle of documents on 26 May 2021, including the documents that the landlord asserted were the documents relied upon by the landlord at the Tribunal hearing on 17 March 2021. Relevantly, such documents included emails between the tenants and the landlord's agent.

Decision of the Tribunal

The Tribunal gave detailed and concise reasons for finding that there had been no mutual agreement between the parties to reduce the rent, nor had the landlord made any representation to the tenants that rent would be reduced.
The decision sets out the evidence of both parties. The tenants asserted that there was an "oral agreement" to reduce the rent on the basis that the tenants were financially COVID-19 impacted. The tenants told the Tribunal that the agreement was "oral only".
The landlord's agent gave evidence denying that there had been any oral agreement to unconditionally reduce the rent. Rather, according to the landlord's agent, Ms Chiangwong telephoned her in March 2020 and said that the tenants could not afford to pay more than $500 per week. The agent then sent an email on 24 March 2020 requesting documentary evidence that the tenants were COVID-19 impacted. The agent stated that no financial documents of the tenants were produced to the landlord, and the tenants unilaterally started paying $500 per week rent from 25 March 2020.
The landlord's agent's evidence was that after 25 March 2020 she made a number of telephone calls informing the tenants that the landlord had not agreed to any rent reduction and sent emails and text messages requesting payment of rent arrears. None of those emails or text messages referred to any rent reduction.
Having considered the evidence, the Tribunal found: "As discussed with the parties, the Tribunal has no power to vary rent for financial hardship; the Tribunal can only assess the evidence before it to assess the legal and factual basis for the arrears claimed. On the evidence advanced the Tribunal is satisfied that the tenants and landlord were parties to a residential tenancy agreement in relation to which the rent payable since 2017 was $920.00 per week. The Tribunal is not satisfied on the evidence before it that the rent was ever agreed between the parties to be paid at a reduced rate. The Tribunal is satisfied, based on the ledger submitted, that the unpaid rent owed by the respondent tenants to the landlord for the period commencing 11 July 2020 until 26 October 2020. The Tribunal calculates the sum owing as $14,194.29, based on weekly rent payable of $920 per week. However, the claim made by the landlord is for rent owing in the sum $14,155.00. Accordingly, the Tribunal makes money order for that lower sum identified by the landlord's agent."

Consideration

The statutory framework of the amendments to the RT Act and Residential Tenancies Regulation 2019 (NSW) introduced by the Residential Tenancies Amendment (COVID-19) Regulation 2020 (NSW) is discussed in detail in Lewis v Rejko Pty Ltd [2021] NSWCATAP 186 ("Lewis").
The decision in Lewis also discusses the applicable legal principles to whether or not there has been variation of a residential tenancy agreement in regard to the rent payable; or in the alternative whether a landlord is estopped from claiming the full amount of rent arrears by reason of any representations or conduct of the landlord in regard to an unconditional rent reduction.
It is unnecessary to repeat those principles.
When the reasons of the Tribunal are read fairly and in context, the Tribunal found on the evidence that there had not been any mutual agreement to reduce the rent and the landlord (acting through its agent) had not made any representation to the tenant that the rent had been unconditionally reduced.
Rather, the tenants had unilaterally formed the view that $500 per week was payable, because in their view that was the amount they could afford due to their loss of income caused by the COVID-19 pandemic. The Tribunal did not accept the tenants' version of events (which was disputed by the landlord's agent) that the agent had orally agreed to an unconditional rent reduction. There was also evidence of emails and text messages where the landlord had raised the issue of rent arrears and sought payment of the arrears.
The evidence referred to in the reasons of the Tribunal clearly supported the factual findings made. We are not satisfied the Tribunal applied any incorrect legal principles. Its reasoning process was orthodox. There is nothing to indicate any failure to accord procedural fairness in the conduct of the hearing, and in any event, this was not raised as a ground of appeal. The evidence of both parties was considered and evaluated.
Further, on the issue of leave to appeal, we are not satisfied that the tenants may have suffered a serious miscarriage of justice due to the decision not being fair and equitable; or being against the weight of evidence; or that there is significant new evidence now available that was not reasonably available at the date of the Tribunal hearing.
As discussed previously, the reasons of the Tribunal clearly set out the evidence of both parties. The factual findings made were available to the Tribunal having weighed and considered that evidence. There was nothing to indicate any significant new evidence was now available to the tenants which was not available at the hearing on 17 March 2021.
We do not regard issues raised by the tenants about having English as a second language; or the typographical error in an email by the landlord's agent to the tenants regarding payment of rent arrears; or the bond being paid to the landlord as have any bearing on whether there is an error of law in the decision of the Tribunal or whether leave to appeal on an error other than an error of law should be granted.

Orders

We make the following orders: 1. Leave to appeal 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: 30 June 2021

Residential Tenancies Amendment (COVID-19) Regulation 2020(NSW)

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