Davies v O'Keeffe

Reasons for the Decision

1. The appeal was lodged on 12 October 2015. Mr Davies, a tenant, is appealing a decision of the Tribunal, made on 24 September 2015, dismissing his application.
2. In 'residential proceedings,' an appeal must be lodged within 14 days from the day on which appellant was notified of the decision or given reasons for the decision, whichever is the later: Civil and Administrative Tribunal Rules 2014 (NSW), r 25(4)(b) (the NCAT Rules). The reasons are dated 27 September 2015 and the Appeal Panel is satisfied that the appeal has been lodged within time.
3. In the Notice of Appeal, the 'Grounds of Appeal' were as follows: 1. The Tribunal erred in declining to extend the time for filing the application. In doing so the Tribunal asked itself the wrong question and/or incorrectly applied section 41 of The Civil and Administrative Tribunal Act 2013 (NSW) (NCAT Act). 2. The Tribunal erred in not applying s45 of the Residential Tenancies Regulation 2010 (NSW) (the Regulations) 3. The Tribunal erred in applying section 43 (2) of Residential Tenancies Act 2010 (NSW ) (RTA) 4. The Tribunal fell into error by failing to take into account relevant considerations that should have been taken into account. 5. The Tribunal decision is irrational and/or afflicted by legal unreasonableness and is therefore void.
4. An internal appeal may be made as of right on any question of law or with the leave of the Appeal Panel, on any other grounds pursuant to s 80(2)(b) of the NCAT Act. The appellant confirmed at hearing that they were only appealing the matter on the basis of an error of law and were not seeking leave to appeal on any other grounds.

Background to the Matter

1. The initial application by the tenant to the Tribunal was for refund of all rent paid to the landlord on the basis that the premises had never been inhabitable. From about June 2014 the appellant, had been working with the respondent and was homeless and seeking accommodation. It was agreed that appellant would reside, rent free, in a part of the respondent's property in exchange for assisting with its renovation. In about October 2014 the respondent began deducting $200.00 from the applicant's wages. There is some dispute about when the appellant ceased working for the respondent, however it appears to have been sometime in late 2014. On 10 July 2015 the appellant lodged an application with the Tribunal seeking compensation by way of a refund of rent paid, on the basis that the premises were not habitable. The appellant also sought orders challenging a 90 day termination notice on the basis that it was retaliatory. The appellant confirmed at hearing that the appeal did not relate to any issues regarding the termination notice being retaliatory.

The Tribunal erred in declining to extend the time and incorrectly applied section 41 of the NCAT Act.

1. Section 41 of the NCAT Act states: (1) The Tribunal may, of its own motion or on application by any person, extend the period of time for the doing of anything under any legislation in respect of which the Tribunal has jurisdiction despite anything to the contrary under that legislation. (2) Such an application may be made even though the relevant period of time has expired.
2. 14 In the reasons provided in relation to the tenant's application, the Tribunal stated: In addition the Regulations provide that an application in respect of breach of a party's obligations is to be filed within 3 months of the party becoming aware of the breach. The tenant says he was aware that the premises were not habitable when the landlord first began to deduct rent from his wages, in August 2014. These proceedings were not filed until 10 July 2015. The tenant did not seek an extension of time for filing of the proceedings. However, the Tribunal may consider whether it is appropriate in any case to extend time (Civil & Administrative Tribunal Act 2013 s 41). The matters to be considered were discussed by the Appeal Panel in Jackson v NSW Land and Housing Corporation [2014] NSWCATAP 22. At [22] the Appeal Panel said (in respect of notices of appeal): "The considerations that will generally be relevant to the Appeal Panel's consideration of whether to grant an extension of time in which to lodge a Notice of Appeal include: .... (3) (a) The length of the delay; (b) The reason for the delay; (c) The appellant's prospects of success, that is usually whether the applicant has a fairly arguable case; and (d) The extent of any prejudice suffered by the respondent (to the appeal), - Tomko v Palasty (No 2) (2007) 71 NSWLR 61at [55] (per Basten JA) but note also [14], Nanschild v Pratt [2011] NSWCA 85 at [39] to [42]; and (4) It may be appropriate to go further into the merits of an appeal if the explanation for the delay is less than satisfactory or if the opponent has a substantial case of prejudice and, in such a case, it may be relevant whether the appellant seeking an extension of time can show that his or her case has more substantial merit than merely being fairly arguable - Tomko v Palasty (No 2) (2007) 71 NSWLR 61 at [14] (per Hodgson JA, Ipp JA agreeing at [17]) and Molyneux v Chief Commissioner of State Revenue [2012] NSWADTAP 53 at [58] - [59]." Applying these principles, the Tribunal must consider that there has been a delay of some 9 months in bringing these issues to the Tribunal. The tenant says that that is because he did not want to lose his job, and the accommodation. However, the tenant has not worked for the respondent since Christmas 2014. The accommodation which he is fearful of losing is not habitable, on his own submission. Whilst if these proceedings had been brought immediately after the agreement had been made, they would have had a high chance of success, the Tribunal is not satisfied that it is just to make the compensation order sought because the prejudice to the respondent, in having the applicant live rent free for 12 months and continuing, outweighs the prejudice to the applicant. He has had the benefit of the accommodation which, on his own application, was of such value to him that he did not wish to raise an issue lest he lose that right. The applicant's real motivation was expressed towards the end of the hearing, when the tenant's partner stated that her wages were insufficient to enable them to find alternate accommodation. They seek this compensation to fund them into alternate accommodation. This is not a just outcome to the respondent.
3. The appellant states that the Tribunal fell into error because it failed to take into account the relevant considerations that should have been taken into account when deciding the extension of time issue including; 1. The applicants dependence on the first respondent in regards to his work 2. The applicants evidence in relation to delay in filing the application 3. The amount of work/repairs completed on the premises 4. And the benefit received by the first respondent 5. The effect of the termination notice of the applicant.
4. The appellant referred the Appeal Panel to the case of Gallo v Dawson [1990] HCA 30; 64 ALJR 458; 93 ALR 479 at [2] and included the following statement: The grant of an extension of time under this rule is not automatic. The object of the rule is to ensure that those Rules which fix times for doing acts do not become instruments of injustice. The discretion to extend time is given for the sole purpose of enabling the Court or Justice to do justice between the parties: see Hughes v. National Trustees Executors and Agency Co. of Australasia Ltd. (1978) VR 257, at p 262. This means that the discretion can only be exercised in favour of an applicant upon proof that strict compliance with the rules will work an injustice upon the applicant. In order to determine whether the rules will work an injustice, it is necessary to have regard to the history of the proceedings, the conduct of the parties, the nature of the litigation, and the consequences for the parties of the grant or refusal of the application for extension of time: see Avery v. No.2 Public Service Appeal Board (1973) 2 NZLR 86, at p 92; Jess v. Scott (1986) 12 FCR 187, at pp 194-195. When the application is for an extension of time in which to file an appeal, it is always necessary to consider the prospects of the applicant succeeding in the appeal: see Burns v. Grigg (1967) VR 871, at p 872; Hughes, at pp 263-264; Mitchelson v. Mitchelson (1979) 24 ALR 522, at p 524. It is also necessary to bear in mind in such an application that, upon the expiry of the time for appealing, the respondent has "a vested right to retain the judgment" unless the application is granted: Vilenius v. Heinegar (1962) 36 ALJR 200, at p 201. It follows that, before the applicant can succeed in this application, there must be material upon which I can be satisfied that to refuse the application would constitute an injustice. As the Judicial Committee of the Privy Council pointed out in Ratnam v. Cumarasamy (1965) 1 WLR 8, at p 12; (1964) 3 All ER 933, at p 935: "The rules of court must prima facie be obeyed, and in order to justify a court in extending the time during which some step in procedure requires to be taken there must be some material upon which the court can exercise its discretion."
5. The appellant stated that the Tribunal had failed to consider the possible injustice caused to the appellant if an extension of time was not granted. The appellant suggested that the Member had identified considerations in relation to extensions of time which were only relevant to 'appeal proceedings'. In that regard the appellant is referring to the Member's application of the principles summarised in the Appeal Panel decision of Jackson v NSW Land and Housing Corporation [2014] NSWCATAP 22. The appellant stated that the factors summarised in Jackson v NSW Land and Housing Corporation relate only to considerations of extensions of times in appeals and not to applications in the Tribunal. The appellant put to the Appeal Panel that all that was required was a consideration of the injustice to the applicant if an extension of time was not granted.
6. Jackson v NSW Land and Housing Corporation was indeed an Appeal Panel decision. The case involved considerations of an extension of time to lodge an application pursuant to s 41 of the NCAT Act. What was considered by the Member was a summary of principles that were identified in Jackson v NSW Land and Housing Corporation as being relevant to any consideration of a statutory extension of time provision. The Appeal Panel does not find that to be an error of law. The Tribunal is satisfied that the Member has correctly identified the principals as summarised in Jackson v NSW Land and Housing Corporation and they are the relevant principles applicable to any consideration of a statutory extension of time, whether in the Tribunal or before the Appeal Panel. Jackson v NSW Land and Housing Corporation provides a succinct summary of the principles that a decision-maker is to consider in deciding whether to exercise a statutory discretion to extend time.
7. Further, to suggest that the only thing necessary when considering an extension of time is the injustice caused to the applicant misconstrues the concept of procedural fairness. The issue cannot be only a consideration of whether an extension of time would be unfair to an applicant. What is fair has to take into account the interests of the respondent to the proceedings as well.
8. In relation to the appellants claim that the Member did not properly exercise the discretion and failed to give proper weight to relevant considerations, we refer to the helpful summary of the legal principals in the Appeal Panel decision of Matthew Bryan v Lilly Gorgievski and Les Gorgievski [2015] NSWCATAP 186. The exercise of a statutory discretion can only be overturned in limited circumstances (refer BZE v NSW Public Guardian [2015] NSWCATAP 64 and the authorities cited, House v King (1936) 55 CLR 499 and Hannaford v Commonwealth Bank of Australia [2014] NSWCA 297). As noted in BZE at [15], any attack on a discretionary decision must fail unless it can be demonstrated the decision-maker made an error of legal principle or material error of fact, took into account an irrelevant matter, failed to take into account, or gave insufficient weight to some relevant matter or arrived at a result so unreasonable or unjust as to suggest on of the other errors occurred.
9. In our view, the Member did not fall into such error. The Member clearly considered the following: 1. There had been a delay of some 9 months in bringing the issues to the Tribunal. 2. That tenant stated that he did not make the application because he did not want to lose his job 3. The tenant had not worked for the respondent since at least December 2014. 4. The applicant was making submissions that the premises were uninhabitable on the one hand and stating he was fearful of losing them on the other. 5. The delay would cause significant prejudice to the respondent and a repayment of all the rent would result in the applicant having lived rent free for 12 months and continuing. 6. The applicant had the benefit of the accommodation which, on his own application, was of such value to him that he did not wish to raise an issue lest he lose that right. 7. The applicant's real motivation was to enable them to find alternate accommodation and they were seeking compensation to fund them into alternate accommodation. That was not a just outcome for the respondent.
10. Ultimately, the Member found that the disadvantage to the respondent outweighed the prejudice to the applicant. The Member clearly identified both parties submissions in weighing up the discretion, including the possible injustice caused to the appellant. The Appeal Panel is not satisfied that the Member made an error of legal principle or material fact or that she took into account irrelevant matters. The Appeal Panel is not satisfied that the Member failed to take into account or give sufficient weight to the relevant matters, that she arrived at an unreasonable or unjust outcome or that she failed to properly apply the statutory discretion or extend time.

The Tribunal Failed to Consider ss 43(2), 45, and 47(5) of the Act

1. The appellant made submissions that although the sections were not specifically pleaded in the initial application, the Member erred in not considering sections 43 (2), 47 and 45 of the RTA. The appellant made submissions that although the sections were not specifically referred to in the tenant's application, it should have been clear to the Member that the tenant, who was unrepresented was making his application under those sections. In the written submissions to the Appeal Panel the appellant had only referred to ss 43 and 45 and had made no mention of s 47. S 47 was only raised at the Appeal hearing.
2. In the reasons the Member stated: the Regulations provide that an application in respect of breach of a party's obligations is to be filed within 3 months of the party becoming aware of the breach.
3. While not specifically referred to by the Member, it is clear that she was considering r 22 of the Regulations which provides the time limits in relation to and pursuant to s190 of the RTA: (9) For the purposes of section 190 (1) of the Act, the prescribed period for making an application for an order in relation to a breach of a residential tenancy agreement or proposed agreement is within 3 months after the applicant becomes aware of the breach.
4. Section 190 of the RTA relates to a breach by a party and relevantly states: (1) A landlord or a tenant may apply to the Tribunal for an order in relation to a breach of a residential tenancy agreement within the period prescribed by the regulations after the landlord or tenant becomes aware of the breach or within such other period as may be prescribed by the regulations. (2) An application may be made: (a) during or after the end of a residential tenancy agreement, and (b) whether or not a termination notice has been given or a termination order made.
5. Counsel made submissions that had the alternative ss 43, 45 and 47 been considered by the Member then there would have been no requirement for consideration of an extension of time under section 41 of the NCAT Act.
6. At the Appeal hearing, Counsel's attention was drawn to r 23 of the NCAT Rules. The rule requires that an application be made 28 days from when a party becomes entitled to make an application in those cases where the enabling legislation does not impose a time limit. Counsel for the appellant conceded at hearing that she had been unaware of r 23 the NCAT Rules. It appears that the appellant had proceeded on this ground of appeal because they were under the mistaken belief that a consideration of ss 43, 45 and 47 would not have required consideration of an extension of time pursuant to s 41 of the NCAT Act.
7. The Appeal Panel is satisfied that rule 23 of the NCAT rules would have applied to ss 43, 45 and 47 even though the RTA does not apply a time limit on those sections. Even if the Member had considered those sections as the causes of action for the tenant, an extension of time would have been required to make the application pursuant to s 41 of the NCAT Act. 28 days is a shorter period than the three months allowed for an application for breach under s 190 of the RTA. The same factual and legal considerations would have been required in relation to an extension of time to make the application under those sections as was considered by the Member in relation to extending time for the making of the application under s 190 of the RTA. Presumably, such a request for an extension of time to make an application under those sections would have also failed before the Member.
8. Moreover, the Appeal Panel is not satisfied that the Member has failed to properly identify the applicant's cause of action. It is true that the Tribunal is not a Court of strict pleadings and the parties are unrepresented. However, from the submissions that had been provided by the tenant in relation to his application, it was not discernible that any application was being made under ss 43, 45 or 47 and in fact they would not have been applicable.
9. The orders the applicant tenant had been seeking in the initial application were: S115 An order declaring that termination notice has no effect because retaliatory notice S187 (1) (c) An order for the payment of money S187 (1) (d) An order as to compensation
10. S 187 of the RTA sets out the order making powers of the Tribunal and does not identify causes of action. In the tenants application, under 'What are your reasons for requesting the order/s?' the tenant had written: 25th-4-2015 Peter told me had to get out for the next 3 weeks Turned up asking if found house yet 30-5-2015 - sent text cutting electricity off, put rent up $50.00 in text message saying money would be banked and receipts given (still have not received ever) 10-6-2015 had to ask for bank details took 21 days to receive bank info, in that time landlord filed for eviction for failure to pay rent which I went to the Tribunal and was found to be false. 10-6-2015 notified landlord of I know my rights 12-6-15 received two eviction notices for finding out my rights as a tenant. Repay the sum of $7,400.00 for false payment of rent which was taken from my wage 200pw x 9mths
11. The last sentence appears to be the tenants claim for compensation. Clearly the Member proceeded on the basis that the tenant was seeking a refund of those monies on the basis that the landlord had breached the agreement. Section 190 of the RTA deals with any breaches of the agreement. It is clear from the reasons for the order that the essence of the claim was that the tenant had paid rent contrary to the agreement. The Member has clearly considered the applicant's claim as it was put to her.
12. Even though the agreement was oral, s 52 of the RTA relevantly states 52 Landlord's general obligations for residential premises (1) A landlord must provide the residential premises in a reasonable state of cleanliness and fit for habitation by the tenant. …. (4) This section is a term of every residential tenancy agreement.
13. Accordingly, if the tenant's claim was that the premises were uninhabitable, then the applicable section remains s 190 of the RTA.
14. Section 43 (2) of the RTA relevantly states: (2) Premises unusable. The rent payable under a residential tenancy agreement abates if residential premises under a residential tenancy agreement are: (a) otherwise than as a result of a breach of an agreement, destroyed or become wholly or partly uninhabitable, or (b) cease to be lawfully usable as a residence, or (c) appropriated or acquired by any authority by compulsory process.
15. It was put to Counsel at the hearing that the section seemed only to apply to those situations in which premises "become" wholly destroyed or in which it "ceases" to be inhabitable. In the reasons for decision the Member states: that he entered into an oral agreement with the respondent to occupy the residential premises, rent free until they were made habitable, with the applicant assisting to do the place up.
16. It such circumstances s 43(2) of the RTA would not apply. The applicant's evidence is that the premises were never habitable to begin with, they did not "become" or "cease" to become uninhabitable or partly uninhabitable. The Appeal Panel is satisfied that s 43(2) of the RTA would not have been applicable on the submissions that were made by the tenant.
17. Section 45 of the RTA relevantly states; 45 Remedies for reduction of rent on frustration of residential tenancy agreement (1) The Tribunal may, on application by the landlord or tenant, make an order determining the amount of rent payable if the rent is abated under section 43 (2). (2) The Tribunal may order that: (a) from a specified day, the rent for the residential premises must not exceed a specified amount, and (b) the landlord must repay to the tenant any rent paid by the tenant since the specified day that is in excess of the specified amount.
18. Again this section would not have applied as the rent was never and could never have been abated under s 43 of the RTA for the reasons given in paragraph 30 above.
19. S 47 of the RTA relevantly states: 47 Tenant's remedies for repayment of rent and excess charges (1) Requests to landlord A tenant may make a written request to the landlord that the landlord repay to the tenant any rent, or other amounts, paid by the tenant that are not required to be paid under this Act or the residential tenancy agreement. (2) A request may be made during or after the termination of a residential tenancy agreement. (3) A landlord must, within 14 days of a written request by a tenant, repay to the tenant the amount of any rent or other amount paid in excess of the amount payable by the tenant under this Act or the residential tenancy agreement. (4) Tribunal orders A tenant may apply to the Tribunal for an order for the repayment of rent or any other amount paid by the tenant if a written request by the tenant for payment is not complied with by the landlord within 14 days. (5) The Tribunal may order that rent or any other amount be repaid to the tenant if it finds that the rent or amount was not required to be paid by the tenant under this Act or the residential tenancy agreement.
20. Counsel for the appellant made submissions at hearing that in particular s47(5) applied. This had not been raised in the notice of appeal or the written submissions provided to the Appeal Panel prior to the hearing.
21. In any case, the Appeal Panel is not persuaded that s 47(5) can be read on its own in isolation from the rest of the section. It has to be read in context of the whole section. The section clearly applies to those situations in which the tenant has paid rent which is not required to be paid under the Act or the residential tenancy agreement. The first paragraph of the section clearly deals with steps to be taken by the tenant when a tenant has overpaid rent. The tenant must make a written request to the landlord and then the landlord must repay the rent within 14 days of the request. Para 4 and 5 then provide the remedy for the tenant to apply for an order if the rent has not been repaid by the landlord within the 14 days and para 5 gives the Tribunal the power to make the order. There is nothing to suggest that the tenant followed the process that is required under s47(1) of the RTA. Accordingly absent such evidence or submissions, it cannot be said that the Member should or could have known to consider making an order pursuant to s47(5) of the RTA.
22. The last two grounds raised by the appellant in relation to the appeal appear to be a repetition of issues raised in the previous grounds. Ground 4 which is that the Tribunal fell into error by failing to take into account relevant considerations that should have been taken into account relates to the factors considered by the Member in relation to an extension of time has been dealt with in these reason in relation to the first ground of appeal. The fifth ground of appeal that the Tribunals decision is irrational and/or afflicted by legal unreasonableness and is therefore void, also appears to relate to the Members decision not to extend time and has also been addressed in the Appeals Panels reasoning in relation to ground 1 above.
23. Having considered all the grounds of appeal therefore, the Appeal Panel finds no error of law and 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

Amendments 17 February 2016 - Paragraph 11 - added the word 'not'. 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: 17 February 2016