Medium Neutral Citation [2002] VCAT 227

Order the Respondent to pay to the Applicant the sum of $13,678.86 forthwith.

1. On 16 February 2000 the Applicant entered into a residential tenancy agreement with the Respondent and Jamie Mitchell. The agreement, inter alia, contained provisions similar to parts of the statutory duties imposed by sections 61, 63 and 64 of the Residential Tenancies Act 1997 (RTA).

2. On 18 March 2001 Jamie Mitchell vacated the premises due to unrelated legal proceedings. On 17 May 2001 the Tribunal (in proceedings in the Residential Tenancies List) found the premises to be abandoned on and from 11 May 2001.

3. The Applicant found that the premises had been damaged and not maintained and proceeded to prepare Contract Orders for repair and restoration of the premises in accordance with its practices under the RTA.

4. The total cost of those orders, when added to the orders for work quoted on or about 7 December 2000, and for work for which the Respondent accepted liability for reglazing and locksmiths following Jamie Mitchell's departure, was $14,247.24. Due to adjustments and changes made by the Applicant at this hearing the amount claimed reduced to $13,678.86.

5. A copy of the application to the Tribunal, to which was attached all the Contract Orders was served by ordinary post on the Respondent on or about 2 January 2002. Further the principal registrar of the Tribunal served a copy of the application on the Respondent in accordance with the Service and Execution of Process Act (Cth) and regulations on or about 4 January 2002.

6. I received into evidence the tenancy agreement the condition report and a large number of photographs and heard sworn evidence from housing officer Barbara Clifford.

7. The amount both originally claimed and as reduced exceeded the monetary limit of $10,000 in proceedings under the RTA for such claims for in section 447 RTA. There was no written agreement to lift that limit as provided in that section. Accordingly, the Applicant sought to bring this claim to VCAT under the Fair Trading Act 1999 (FTA), which gives the Tribunal jurisdiction to determine a claim in matters where the dispute falls into the definition of a "fair trading dispute" under section 107 of the FTA. There is no limit as to the amount of money that the Tribunal may order to be paid when determining a "fair trading dispute" under section 108 FTA.

8. The definitions of a "fair trading dispute" in the FTA require that there be a supplier and a purchaser of goods or services (insofar as is relevant to this matter).

9. "Services" are defined to include any rights in relation to or interests in real or personal property. The definition of "supply" in relation to "services" includes "provide grant or confer". In my view the Applicant is a supplier of services under the FTA when it enters into a residential tenancy agreement with a tenant. A tenant is a purchaser of those services for the purposes of the FTA.

10. To fall within the definition of "services", the "rights benefits privileges or facilities" that the Applicant provides grants or confers must occur in trade or commerce.

11. The issue arises as to whether the services provided by the Applicant having regard to their nature and the limited market in which the Applicant operates are services as defined in the FTA. There is no definition of business in the FTA and this Applicant does not carry out its activities and obligations for profit. However the FTA defines "trade or commerce" to includes "a business not carried on for profit".

12. The definition of "trade or commerce" used by the FTA is used for the definition of "business" in section 4 of the Trade Practices Act (Cth) (TPA). It is apparent that the definition was inserted to overcome problems under the TPA where Commonwealth authorities traded, but might not be contended to carry on a business as there was no element of profit. The TPA goes on to restrict liability of the Commonwealth businesses to those where it is actually engaged in carrying on a business (section 2A) and further defines activities that are not businesses (section 2C).

13. There are no sections similar to 2A and 2C of the TPA to be found in the FTA. However, in the FTA to be in the field of trade or commerce as defined this Applicant must carry on a business albeit not for profit. In my view the repetitious and continuous nature of the Applicant's activities in the letting of premises as residences to tenants is sufficient to find that it is carrying on a business of providing its services within the definition of "trade or commerce".

Coverage of Residential Tenancies Act 1997

14. The purposes of the RTA include defining "the rights of landlords and tenants of rented premises" and providing "inexpensive and quick resolution of disputes under this Act" (section 1(a) and (d)). In the defined areas the RTA achieves its purposes but it is not a Code and does not cover the field.

15. The RTA leaves many areas of disputation that relate to residential tenancy agreements not capable of resolution under the RTA. Examples include tenancy agreement relationships that do not fall within the understanding of "let(ting) premises as a residence", or informal transfers and subletting and substitution of tenants and arrangements by the "head tenant" for payment of utilities and other charges. Other relationships include those of unit owners, landlords and tenants with Strata Body Corporates especially in relation to repairs and Rules. Those disputes might as of right be brought to Courts for resolution - as could, in my view, a claim for rent or damages exceeding the $10,000 monetary limit under the RTA.

Relationship of Fair Trading Act 1999 with Residential Tenancies Act 1997

16. A question arises as to the limit of monetary claims under the RTA and the unlimited claims that may be made under the FTA. The FTA is an enactment later in time than the RTA and (inter alia) applies to interests in land including leases and deals with a much wider field of disputation than the RTA.

17. I see no conflict between the RTA and the FTA. In my view they establish a complementary regime. Most disputes that arise under or in relation to a residential tenancies agreement may be completely dealt with in accordance with the RTA. Where the RTA is silent or limited and the applicable law permits actions in the courts those actions may now be heard at VCAT provided the requirements of a "fair trading dispute" are satisfied.

18. The FTA created a "fair trading dispute" which is merely a mechanism for giving a choice (and in some cases exclusive remedies) to litigants to bring most contractual claims arising out of the provision of goods and services to VCAT that might otherwise be required to have been heard in the Courts. It is my view that there was a clear intent to facilitate litigation in the Tribunal and even a broad encouragement to the Courts to transfer cases to VCAT (section 112 FTA).

19. In my view where an Act prior in time to the FTA confers limited jurisdiction on VCAT, a fair trading dispute (otherwise unlimited in a court) should not be restricted by the imposition or application of jurisdictional limits in that earlier Act. For example, should claims to which both the FTA and Small Claims Act 1973 (SCA) apply result in that claim being limited to the SCA jurisdiction of $10,000 (section 19 SCA)?

20. Such a result would defeat the legislative intention of creating a jurisdiction for the resolution of FTA matters at VCAT which has no monetary limit as to the amount that may be ordered to be paid. It seems an unlikely intention given the fact that whilst most SCA claims are covered by the FTA the reverse is not necessarily correct. Further the FTA imposes limitations to the jurisdiction of VCAT where considered necessary (section 109).

21. Although not relevant to this case, it should also be noted that the FTA gives VCAT jurisdiction to hear claims arising out of allegations of contravention of the FTA (section 159) and in some other minor areas of the Act.

22. It would be an unsatisfactory outcome if when hearing and determining "an application by a landlord or tenant under a tenancy agreement" (section 447 RTA), any monetary claim for contravention of the FTA (such as the not uncommon allegation of misleading or deceptive conduct or false representations) was limited to $10,000 when in all other similar claims to VCAT there would be no such limit.

23. It would also be unsatisfactory if in circumstances where an allegation of contravention of the FTA is made by a

* landlord or tenant under a tenancy agreement against persons other than a landlord or tenant; or

* person who is not a landlord or tenant making a claim (with leave) relating to a tenancy agreement (section 452 RTA)

that there was any limitation of a remedy in VCAT by operation of a monetary limit in the RTA when in all other claims there would not be such a limit.

24. Section 446 RTA (the first section in Division 2 - Jurisdiction of Tribunal), provides that "the Tribunal has jurisdiction to hear and determine an application under this Act relating to (the matters as then set out)" - my italics. The italicised words probably mean that any reference to an application in the other sections in the Division including the monetary limit imposed in section 447 is restricted to an application made under the RTA and have no effect on applications made under other enabling enactments.

Jurisdiction of the Residential Tenancies List and Civil Claims List in VCAT

25. VCAT has absorbed a number of separate Tribunals that existed prior to July 1 1998. The administrative arrangements for dealing with cases was to allocate enabling enactments to Lists which roughly equated to each List taking over the functions of a pre-existing Tribunal. Jurisdiction under new Acts have been allocated to Lists by amendments to the Rules from time to time.

26. If a member of VCAT is sitting in a List where the dispute is not covered by the Acts allocated to that List but is covered by other Acts allocated to other Lists in VCAT is that member obliged or able to deal with the dispute? Put simply - at any time does the member apply only the law administratively allocated to the List in which the member is sitting (List jurisdiction) or the whole of the law that is within the jurisdiction of VCAT (VCAT jurisdiction)?

27. It so happens that most of the members that regularly hear RTA cases also hear Civil Claims cases (including those under the FTA). But what, if any, obligation is there upon the member to deal with issues under the FTA if the application is brought under the RTA was "pleaded" or became apparent during the course of a hearing?

28. When the FTA commenced it was allocated to a number of Lists not including the Residential Tenancies List. That was remedied on January 1 2002. This application was brought in the Civil Claims List to which the FTA has been allocated since that Act came into force.

29. It follows that regardless of the view that is taken of List jurisdiction or VCAT jurisdiction, parties may now bring a proceeding under the RTA or the FTA or indeed combine actions and claims under both Acts in the Residential Tenancies List. The RTA has not been assigned to the Civil Claims List and whether claims that arise under the RTA are capable of being litigated in the Civil Claims List might at first glance require a decision that Members must apply VCAT jurisdiction rather than being restricted to List jurisdiction.

30. However, it may not be necessary to form a view about VCAT jurisdiction as distinct from List jurisdiction - at least with respect to the operation of the FTA - if one examines the effect of the provisions of section 107 and 108 of the FTA. To do so it may be convenient to first look at the introduction of the SCA in 1974 (then the Small Claims Tribunals Act 1973).

31. When the SCA was introduced, it merely brought the existing contract law in a class of cases restrictively defined as a "small claim" to a Tribunal for resolution. It created no new law - just a mechanism for resolving disputes away from the Courts. It was quickly established that the Tribunal was to apply the whole of the ordinary law applicable to contracts including in appropriate cases the terms and conditions of the specific contract entered into between the parties and any limitations or exceptions in that contract. (R v Small Claims Tribunal; ex parte Barwiner Nominees Pty Ltd [1975] VicRp 82; [1975] V.R. 831 : Walsh (Referee of the Small Claims Tribunal) v Palladium Car Park Pty Ltd [1975] VicRp 91; [1975] V.R. 949)

32. Because the FTA "fair trading dispute" (like the SCA "small claim") is a mechanism for moving the whole of the applicable law applying to the defined disputes into VCAT it is my view that the RTA applies to those matters which fall under it, and any application must only be initiated after the appropriate notices and other requirements of the scheme of the RTA (as part of the applicable law) have been followed. The FTA may then also be used in VCAT to "complete" the claim for any matter or alternative not covered by the applicable law contained in the RTA that could have been taken to a Court prior to the enactment of the FTA (provided there exists a fair trading dispute as defined in, or a contravention of, the FTA).

33. That is so even having regard to the fact that there are different fees for cases brought under different enabling enactments. The Victorian Civil and Administrative Tribunal (Fees) Regulations (Regulations) 2001 provide that fees are set on the basis of the commencement of proceedings under enabling enactments. Thus an application under the RTA attracts a fee of $30 regardless of the type of application - although the monetary claims are limited to $10,000. In the Civil Claims List, FTA claims attract higher fees once they are $10,000 or over. If this claim had been made on a Residential Tenancies Application but "pleaded" a claim in excess of $10,000 under the FTA then the appropriate fee for commencement under the FTA may have to be paid (depending on a particular interpretation of the words "commencement of proceedings under the enabling enactments" in the Regulations).

34. I would observe notwithstanding the findings made as to the coverage of the FTA, that for convenience of the parties in the speed of listing and location of hearing of cases it would be preferable that applications relating to matters wholly or in part covered by the RTA should still be initiated in the Residential Tenancies List with any claim under the FTA being additionally specified in detail in the RTA application.

35. I was satisfied that the Applicant was entitled to bring a claim under the FTA for matters arising under a relationship that would (apart from the monetary limit) also be amenable to resolution under the provisions of the RTA. I was also satisfied that all procedural requirements of the RTA had been complied with by the Applicant. Further, in the absence of any contrary argument I was satisfied that the claim for $13,678.86 was proved and I ordered the Respondent to pay the Applicant that amount forthwith.