Dakin v ICC Group West Ryde Pty Ltd

NCAT Appeal Panel|2024-07-08

Overview

This is an appeal from an order dismissing the appellant's claim for a variety of relief under the Residential Tenancies Act 2010 (NSW) (the RTA).
All of the relief which the appellant sought was based upon her contention that she had made a residential tenancy agreement with the first or second respondent in respect of a two- bedroom unit in West Ryde, Sydney (the West Ryde unit). The Tribunal rejected that contention.
At the hearing of the appeal, Mr Fogarty of Counsel, who appeared for the appellant, informed us that even if the appeal was successful the appellant no longer pursued her claim in respect of what the Tribunal described in its reasons as the claim for "missing goods".
Both parties took the position that if the appeal was successful then a remittal to the Tribunal for a redetermination the appellant's application, save for the claim in respect of the "missing goods" was the course that should be followed. We accept that this is the approach that should be followed, particularly, in circumstances where we were not supplied with all of the oral evidence that was given at the hearing at first instance, there was a dispute as to important questions of fact and the credibility of witnesses was, potentially, in issue.
For the reasons set out below, we have decided that the Tribunal made errors of law in respect of its conclusion that no residential tenancy agreement had been made. Accordingly, the relevant order sought by the appellant in respect of a remittal should be made.

Relevant law

Section 11 of the RTA empowers the Tribunal to make an order declaring that a specified agreement is, or is not, a residential tenancy agreement to which the RTA applies.
Central to the resolution of this dispute was s 13 of the RTA which, relevantly, provides: 13 Agreements that are residential tenancy agreements (1) A residential tenancy agreement is an agreement under which a person grants to another person for value a right of occupation of residential premises for the purpose of use as a residence. (2) A residential tenancy agreement may be express or implied and may be oral or in writing, or partly oral and partly in writing. (3) An agreement may be a residential tenancy agreement for the purposes of this Act even though - (a) it does not grant a right of exclusive occupation, or (b) it grants the right to occupy residential premises together with the letting of goods or the provision of services or facilities. ….
With respect to the resolution of this dispute, important aspects of this definition required that it is necessary that there be an "agreement" (see s 13 (1)), and that the residential tenancy agreement need not be in writing or formal and may be implied.
Furthermore, for there to be an "agreement" there must be an intention to create legal relations: see Case v Frimont at [28]. In that case, Leeming JA said (at [28]): However, there must still be an agreement, and I agree that an arrangement where members of a family share the household of a terminally ill man in order to care for him is a poor candidate for imputing an intention to create legal relations…..
As was adopted by the plurality of the High Court in Ermogenous v Greek Orthodox Community of SA Inc [2002] HCA 8; 209 CLR 95 at [24]: "It is of the essence of contract, regarded as a class of obligations, that there is a voluntary assumption of a legally enforceable duty."[46] To be a legally enforceable duty there must, of course, be identifiable parties to the arrangement, the terms of the arrangement must be certain, and, unless recorded as a deed, there must generally be real consideration for the agreement. Yet "[t]he circumstances may show that [the parties] did not intend, or cannot be regarded as having intended, to subject their agreement to the adjudication of the courts"[47]. [46] Australian Woollen Mills Pty Ltd v The Commonwealth (1954) 92 CLR 424 at 457 per Dixon CJ, Williams, Webb, Fullagar and Kitto JJ. [47] South Australia v The Commonwealth (1962) 108 CLR 130 at 154 per Windeyer J.
As will be seen below, another important aspect of the application of s 13 to the facts in this case was whether the parties had made a residential tenancy agreement that was a "periodic agreement", as recognised by the RTA.
Relevant definitions in s 3 of the RTA are: fixed term agreement means a residential tenancy agreement for a tenancy for a fixed term. periodic agreement means a residential tenancy agreement that is not a fixed term agreement. rent means an amount payable by a tenant in a residential tenancy agreement for the right to occupy premises for a period of the agreement. residential tenancy agreement-see s 13.
Section 85 of the RTA makes provision for the termination of a "periodic agreement". The landlord may give a termination notice which specifies a termination date that is not earlier than 90 days after the day on which the notice is given. The Tribunal must, on application by a landlord, make a termination order if it is satisfied that a termination notice was given in accordance with this section and the tenant has not vacated the premises as required by the notice.
Plainly, the RTA recognises the common law notion of a periodic tenancy agreement, being a tenancy of indefinite duration that runs on from one period to another period of the same duration until determined by appropriate notice; Butt, Land Law,7th ed at 7.280- 7.300. Commonly, such a tenancy arises by implication from the manner in which rent is paid. So, for example, where rent is paid and accepted on a monthly basis, a periodic tenancy from month-to-month arises; Butt at 7.280.

The Tribunal's decision

The Tribunal's written reasons included the following: 9 In 2021 the applicant was living at different premises on the NSW Central Coast with a written tenancy agreement made with an unrelated party since about March 2020. She was familiar with and knew about the need for a written residential tenancy agreement [our emphasis]. …. 13 There was no written tenancy agreement and Mr Harrold Dakin and the applicant agreed that the applicant would pay $190 per week. As I have said, the applicant knew about having a written tenancy agreement but did not request a written agreement for the Premises, and none was made. The arrangement for the Premises was an informal "family arrangement", and was not a residential tenancy agreement. The applicant requested her son to arrange for tax invoices for the payments to be described as "rent" for $760 per month so the applicant had proof of payments to provide to her aged care provider and Centrelink for the purpose of supporting a pension and rent assistance. Mr Harrold Dakin arranged for the corporate respondent to provide tax invoices describing the payments as "Rental" for each monthly period. …. 19 To succeed the applicant must prove there was a residential tenancy agreement to which the Residential Tenancy Act applies. 20 The Tribunal is not satisfied that there was a residential tenancy agreement. There was an unwritten arrangement and the essential terms to establish a residential tenancy agreement are only partially satisfied: the address was known, as was the rent. 21 The corporate respondent was not identified as the landlord for the purposes of such an agreement, as the arrangement was between the applicant and her son Mr Harrold Dakin. And the existence of the corporate respondent was unknown to the applicant at the time the agreement was said to be made. 22 Relevantly, the term or period of the length of the alleged residential tenancy agreement was not specified so that the applicant has not proved that essential term, which is required at the start of a residential tenancy agreement. …. 24 The facts do not support a finding of a residential tenancy agreement between the applicant and either of the respondents 25 The Tribunal finds there was a "family arrangement" between the applicant and Mr Harrold Dakin which is better characterised as a licence agreement at will [our emphasis]. The Tribunal finds this was a temporary and transitional arrangement whilst Mr Harrold Dakin sort out suitable aged residential accommodation for the applicant. This is supported, as the respondents' contend, by the matters set out above, and also the greatly reduced "rent" for the Premises which was well below market rate. The use of the word "rental" in the tax invoices is not determinative as it was merely a convenient label used for the applicant's benefit for the purposes of her pension and rent assistance. 26 The characterisation of the agreement as a licence is further supported by the facts that once Mr Harrold Dakin had located accommodation at Kings Langley, arrangements were made for her to re-locate there, and although she initially agreed to move to Kings Langley, she changed her mind on the day she was taken there [our emphasis]. 27 The claims made on the basis of a residential tenancy agreement must fail.
At the hearing of the appeal Mr McGirr informed us that at the hearing at first instance the respondents did not advance the position that the agreement was a licence (as found by the Tribunal) but, rather, that the arrangement was a family arrangement as to which there was no intention to create legal relations.
However, it appears to be implicit in the Tribunal's conclusion that a licence agreement had been made that there was an intention to create legal relations, namely a licence. We also note, at this point, that the Tribunal did not examine the elements of a licence compared to a residential tenancy agreement (as defined), particularly, with regard to the extended notion of a tenancy set out in s 13 of the RTA. It did not identify that none of the exclusions from the operation of the RTA in sections 7 and 8 of the RTA appeared to be applicable and that there did not appear to have been any agreement made concerning revocation of a licence.

The nature of the appeal

Under s 80 of the Civil and Administrative Tribunal Act 2013 (NSW) (CAT Act) a party may appeal as of right to the Appeal Panel in an internal appeal on any question of law.
In respect of any other grounds, in the case of an appeal from the Consumer and Commercial Division of the Tribunal, as this is, the appellant must satisfy the Appeal Panel that leave to appeal should be granted under cl 12 sch 4 of the CAT Act.
Most of the grounds of appeal (as set out below) raised questions of law.
As explained below, we have decided that three of the grounds of appeal, each of which raise questions of law, should be upheld with the consequence that it is unnecessary for us to deal with all of the grounds of appeal, including those which required leave to appeal.

Grounds of appeal

By an amended Notice of Appeal (for which leave was granted) lodged on 28 June 2024, the appellant raised the following grounds of appeal: 1. The Tribunal erred in law by applying the wrong test under section 13 (1) of the RTA (Ground 1). 2. The Tribunal erred by taking into account irrelevant matters (Ground 1A). One of the matters relied upon by the appellant was the Tribunal's reference to the need for a residential tenancy agreement. 3. The Tribunal made a material errors of fact (Ground 1B). 4. The Tribunal erred in law in failing to take into account a relevant consideration (Ground 2). One of the matters the appellant relied upon was that the Tribunal failed to consider whether a term concerning the duration of the agreement could have been implied in all the circumstances. 5. The Tribunal arrived at an unreasonable and/or unjust result (Ground 2A). 6. The decision miscarried and must be set aside by reason of actual and/or apprehended bias, based on the appearance that the Tribunal held a predetermined view (Ground 2B). 7. The Tribunal erred in law by failing to set out adequate reasons for its decision (Ground 3).
With respect to these grounds of appeal, the appellant provided "Particulars" in her amended Notice of Appeal (as well as in her original Notice of Appeal), along with written submissions dated 27 May 2024. The respondents provided written submissions dated 19 June 2024. These responded to the matters set out in the Notice of Appeal but not to the appellant's written submissions. At the first date the hearing of the appeal (on 26 June 2024) we were told by Mr McGirr that for some reason he had not seen the appellant's submissions dated 27 May 2024 - this provided the reason for adjourning the hearing of the appeal to 8 July 2024. Subsequently, the respondents provided supplementary written submissions dated 4 July 2024. The parties made oral submissions at the hearing of the appeal.

Consideration-Ground 2B (Bias)

We should deal, first, with the contention of bias, which raised a question of law.
At the hearing of the appeal, Mr Fogarty told us that the contention was one of apprehended bias, not actual bias. The contention was that there was conduct by the primary member that gave rise to a reasonable apprehension that the primary member had predetermined the case.
As to apprehended bias, the question is whether a fair-minded lay observer might reasonably apprehend that the Tribunal Member might not bring an impartial and unprejudiced mind to the resolution of the question he was required to decide: Ebner v Official Trustee in Bankruptcy [2000] HCA 63; 205 CLR 337;
The appellant relied on two matters to establish apprehended bias.
The first consisted of the following exchange between the lawyer representing the appellant and the Tribunal which commenced at about two hours and 16 minutes into the hearing, as appears from parts of the transcript of the hearing supplied to us: Appellant's representative: I would like to question bit further around the rental invoices. And the apparent reason that the respondent. Member: the rent invoiced? Why they were issued? Or they have the word rent on? Appellant's representative: Yes, so there claiming of course that they're not actual rent invoices. So, I'd like to question. Member: Well, the answer to that is that, is that is. Your client needed to make submissions or representations to Centrelink and also her Aged Care provider. And so they provided those documents for those purposes. And they appear to be receipts. Appellant's representative: Yes, perhaps if I explain the questions. So, in this statement, in Harrold's statement at paragraph 11, he says that the invoices, that they weren't actually for rent. That they were issued as you save for the purposes of Aged Care and Centrelink. But they were in fact collecting the money off my client every month, so if there are claiming it's not rent, what is the respondent saying that. Member: Licence Fee, on their case it has to be a licence fee. Appellant's representative: Is that the evidence? Member: But hang on, that's his submission in the alternative. They agree that the money is being paid, the issue receipts. What he has to argue is that. I mean you pay money for licence, it was a licence fee. Appellant's representative: Member, I would suggest that the respondent would need to give the evidence. I feel like that evidence is coming not from the respondent. As to the purpose of the time (inaudible) collecting the money. Member: Hang on a second. The question is this. Why is the word rent used? That's the question Miss Comensoli. And that's a good question. And no doubt they are started to think of the answer now. But I know who you going to ask for that. What other topics are going to be covered?
This exchange occurred whilst the second respondent was present in the hearing room and prior to him being cross-examined.
The second matter relied upon by the appellant was the fact that the decision, with written reasons, was issued within a short period of time of the conclusion of the hearing, namely 1 hour and 45 minutes after the hearing concluded in circumstances where the Tribunal needed to consider all of the oral evidence and some 200 pages of documentary material.
Based upon these two matters the appellant contended that the Tribunal had come to a predetermined view that the relationship between the parties was a family arrangement involving the grant of a licence.
We do not accept this contention of apprehended bias. The exchange relied upon was one exchange only in a hearing that went for nearly 3 hours, and in circumstances where we were only supplied with a transcript of part of the hearing.
We note also that near the commencement of the hearing, in an exchange with Mr McGirr that was not relied upon by the appellant, the Tribunal expressed a view that the arrangement was, possibly, a licence accompanied by the suggestion that this was what the respondents were saying was their case - a view, presumably, resulting from the primary member's reading of some (at least) of the written material supplied by the parties before the hearing. The exchange relied upon by the appellant is consistent with the Tribunal exploring with the appellant's legal representative a preliminary view, founded upon what the primary member understood the respondents' case to be, albeit in a reasonably robust manner.
We also note that in the exchange relied upon the Tribunal acknowledged that it was a good question why the word rent was used in the invoices and that following the exchange relied upon by the appellant the primary member asked open questions of Mr Harrold Dakin as to what the payment was for and why he had described it as rent in the invoices (transcript at page 277 of the appellant's bundle on appeal). This was followed by questions from the Tribunal which challenged some of Mr Dakin's answers on these subjects (transcript at pages 277-278 of the appellant's bundle).
These other exchanges are not consistent with the Tribunal having or appearing to have a predetermined view on the subject. In this regard, we bear in mind the remarks of the Chief Justice in Crackin' Snack Pty Ltd v Gameking Australia Pty Ltd [2024] NSWCA 182 at [85] about the vice, often evident in complaints of bias, in the selective quoting or "cherry-picking "of aspects of the transcript.
The period of time which elapsed between the conclusion of the hearing and the delivery of the decision and reasons provides no support for the bias contention. It is a common occurrence for Tribunal to deliver reasons immediately or shortly after conclusion of the hearing at first instance-indeed, more quickly than the Tribunal did in this case. Written material is supplied by parties before the hearing with a view to facilitating the expeditious delivery of a decision. For all we know, the Tribunal had an opportunity to consider this written material, or most of it, before the hearing commenced.
Accordingly, we reject Ground 2B of the appeal.

Consideration-Ground 1 (applied the wrong test), Ground 1A (took account of an irrelevant consideration, namely, the need for a written agreement) and Ground 2 (the Tribunal failed to take account of a relevant consideration, namely, whether a term as to the duration of the agreement could be implied)

It is convenient to consider these particular grounds of appeal together because we consider that they all stem from the failure of the Tribunal to apply the right test and, hence, to direct itself to the right questions.
The appellant submitted that the Tribunal paid no regard to those aspects of s 13 of the RTA, in conjunction with the RTA's recognition of a periodic tenancy agreement, which showed that a residential tenancy agreement did not require that a term or length of the tenancy be specified and that a written tenancy agreement was not required. It was submitted that the Tribunal paid no regard to the scope for a periodic agreement to be implied in all the circumstances, including the occupancy and payment of rent on a monthly basis.
The respondents submitted that in concluding that no residential tenancy agreement existed the Tribunal had regard to a number of factors, one of which was the absence of any agreement as to the term of the tenancy, that the Tribunal's approach was consistent with established principle and that there was simply no evidence of any agreement in relation to the term of the lease whether periodic, fixed or otherwise.
In any event, it was submitted by the respondents that the evidence before the Tribunal disclosed what was clearly a legally unenforceable, informal family arrangement-a conclusion that was consistent with Case v Frimont, which decision showed that it was necessary to determine whether there was an agreement and that an agreement required an intention to create a legal relationship. It was submitted that this was the approach the Tribunal had taken.
In their written submissions dated 19 June 2024 the respondents went on to submit that there was a rebuttable presumption that an arrangement struck between family members is not intended to have legal force and that based upon all the circumstances it was open to the Tribunal to find that the arrangement was simply an unenforceable informal family arrangement.
However, the appellant in her written submissions dated 27 May 2024, correctly, pointed out that the plurality of the High Court in Ermogenous (at [26]-[27]) had disapproved of the use of presumptions concerning "family arrangements" in deciding whether there was the required intention to create legal relations.
In our view the Tribunal did not ask itself the correct questions that arose on the facts of this case from a consideration of the relevant terms of s 13 of the RTA, in conjunction with the RTA's recognition of a periodic agreement.
In the first place, the Tribunal made no reference to s 13 of the RTA or to the potential existence of a periodic agreement. Instead, it made reference to the need for a written residential tenancy agreement, but s 13 makes it clear that this is not required.
The Tribunal also concluded that the appellant had not proved an essential term, which it said was required at the start of a residential tenancy agreement, because the term or period of the tenancy agreement had not been specified. However, this took no account of the provision in s 13 for a residential tenancy agreement to be implied and of the common law notion of a monthly periodic tenancy agreement of indefinite duration being implied from the payment of a monthly rental.
Whilst it is unclear whether the Tribunal considered that an agreement as to a fixed term was required but if that was the case, it was an error: see, for example, Corcoran v Far [2017] NSWCATAP 16 at [46]-[48].
It is true that the Tribunal concluded that a family arrangement (for a licence at will) was arrived at. However, so far as appears from the reasons, this conclusion was not based upon a finding that there was no agreement and that this was because there was no intention to create legal relations. On the contrary, as already mentioned, the conclusion that the arrangement should be characterised as a licence suggests that the Tribunal did consider there was an agreement and that there was an intention to create legal relations. The Tribunal did not say that it was following the approach to these matters taken in Case v Frimont.
The reasons suggest that the conclusion of a family arrangement for a licence resulted in part, at least, from the Tribunal's flawed approach to the question whether there was a residential tenancy agreement, to which we have already referred. The Tribunal also emphasised that it saw the arrangement as a temporary or transitional one but this assessment was not inconsistent with a periodic agreement, a characterisation that the Tribunal failed to consider.
The Tribunal made reference to the fact that the first respondent was not identified as the landlord and was unknown to the appellant. But it was uncontroversial that the first respondent was the owner of the premises and an inference was available that any legally enforceable agreement that was made was one between the appellant and the first respondent, through the agency of the second respondent. Indeed, as the appellant pointed out in their written submissions, it was, at least, questionable whether there was any real issue about this question given that the respondents had said in their written submissions to the primary member lodged on 23 January 2024: 4 The [first] respondent has authorised Mr Harold Dakin the applicant's son to provide evidence in response to the applicant's claim as it was Mr Harold Dakin who on behalf of the responded (sic) company entered into the arrangement with his mother to move into the premises which were occupied by her and owned by the [first] respondent.
Accordingly, we uphold Ground 1 of the appeal, Ground 1A, in so far as it was based upon the Tribunal's reliance upon the need for a written agreement and Ground 2, in so far as it was based upon the Tribunal's failure to consider whether a term as to the duration of the agreement could be implied.

Outcome

In the circumstances, it is unnecessary for us to deal with the remaining grounds of appeal.
There must be a redetermination of the merits of the appellant's claim, save for the appellant's claim in respect of the alleged missing goods. The remitter should be to a differently constituted Tribunal. Such an order is in the interests of justice in this case, including its appearance, in accordance with the approach to be taken to the making of such an order as set out by the Appeal Panel in Chapman v Nicolosi (No 2) [2023] NSWCATAP 73 at [16]-[24]. This is because the Tribunal expressed a firm and concluded view about the merits of the appellant's case, which was adverse to the appellant.

Orders

For the above reasons we make the following orders: 1. The appeal is allowed. 2. The order made by the Tribunal on three April 2024 dismissing the appellant's application is set aside, save to the extent that it dismissed the appellant's claim in respect of what was described in the Tribunal's decision as the "missing goods". 3. Save for the appellant's claim in respect of what was described in the Tribunal's decision as the "missing goods", the proceedings are remitted to the Consumer and Commercial Division for hearing and redetermination by a differently constituted Tribunal on such evidence as the parties file and serve in accordance with the directions and the rules for that hearing. I hereby certify that this is a true and accurate record of the reasons for decision of the New South Wales Civil and Administrative Tribunal. Registrar 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: 09 August 2024

At a glance

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Decision date

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Judgment (10 paragraphs)

Parties

Legislation Cited (2)

Cases Cited (9)