Fanti v Hargraves

Fanti v Hargraves - [2024] NSWCATCD 15 - NSWCATCD 2023 case summary — Zoe

During the hearing the landlord confirmed that her claim was as set out in Tab 6 of her documentary evidence. Noting the landlord has consented to the Tribunal's jurisdictional limit, the amount sought is $32,813.27, comprised of $1300 of rental arrears, $2111.75 for utility charges and $29401.52 for breaches of s 51(3) of the RT Act. It is convenient to summarise the table that appears on those pages in order to be able to refer to each point of claim by number in these reasons: Rental Arrears Claims 1. Rental arrears for week of 22/05/2023 - $650 2. Rental arrears for week of 27/08/2023 - $650 Utility Charges Claims 1. Water bill for Jun/23 - $228.45 2. Water bill for Mar/23 - $221.70 3. Water bill for Dec/22 - $227.68 4. Internet usage charges throughout tenancy - $350 5. Final water bill - $275.55 6. Final electricity bill - $490.03 7. Final gas bill - $248.34 8. Final internet bill - $70 Repair and Cleaning Claims 1. Replacement/installation of 3x bedroom curtains - $330 2. Repair dent on wall of main bedroom - $275 3. Repair dent on floor of main bedroom - $1815 4. Front yard gardening - $2442 5. Repair damage to kitchen floor - $220 6. General end of lease cleaning - $1300 7. Replace dog door flap in laundry - $110 8. Replace tap on washing machine - $77 9. Repair to laundry room door - $165 10. Mould removal - $880 11. Repair interior painting damage - $165 12. Replacement of 3x curtains due to mould - $330 13. New washing machine - $853 14. Replacement of timber floorboards - $7128 15. Rehanging of door in guest bedroom - $165 16. Repair/replacement of kitchen drawers - $264 17. Pest treatment - $825 18. Rubbish removal and gardening - $385 19. Removal of grip tape on deck - $253 20. Replacement light bulb - $5.83 21. Replacement heat lamp bulbs x3 - $31.19 22. Stain and repair of timber decking - $1320 23. Cleaning of 2x reverse cycle air conditioners - $385 24. Repair damage to cupboard in bedroom - $270 25. Repair damage to 3x sections of skirting board - $440 26. Repair laundry door frame - $880 27. Front door replacement - $82.50 28. Repair wall dent in main bedroom - $275 29. Replacement of 10 chairs - $4425 30. Repair structural damage to outdoor deck - $3300

[5]

Jurisdiction and Relevant Law

On the basis of the supplied RTA, the Tribunal has jurisdiction to hear and determine this application.
I note that the RTA entered into between the parties is a template that appears to be a truncated form of the standard agreement used for residential tenancies in Victoria and is unsigned. Nothing turns on this. The law of NSW does not require use of the standard form set out in the regulation, and oral agreements are possible. I am satisfied that the parties reached an agreement, the key terms of which are documented in the RTA and that the agreement to those terms is recorded through an exchange of emails between the parties.
To the extent that any provision in the RTA is inconsistent with the RT Act, this is addressed in s 21(1) which provides: (1) A term of a residential tenancy agreement is void to the extent to which it-- (a) is inconsistent with any term included in the agreement by this Act or the regulations, or (b) is prohibited by this Act or the regulations.
The Tribunal's power to make orders for compensation is set out in section 187(1)(d) of the RT Act. This power is enlivened where the landlord establishes, on the balance of probabilities, that the tenant has breached the RTA. The landlord must show that the breach is a cause of the loss claimed (Fitzgerald v Penn (1954) 91 CLR 268 at 273; Alexander v Cambridge Credit Pty Ltd (1987) 9 NSWLR 310 at 361), that the loss is a reasonably foreseeable consequence of the respondent's breach (Hadley v Baxendale [1854] 9 Ex 341) and must provide evidence to support the total amount being claimed with as much precision as the subject matter reasonably permits (Placer (Granny Smith) Pty Ltd v Thiess Contractors Pty Ltd [2003] HCA 10; (2003) 77 ALJR 768, Hayne J at [37]).
The landlord must take steps to mitigate their losses (BM & JA Holdings Pty Limited v Clarence Street Developments Pty Limited [2012] NSWSC 1236), but the tenant bears the burden of proof in establishing the applicant's failure to mitigate loss (Sacher Investments Pty Ltd v Forma Stereo Consultants Pty Ltd (1976) 1 NSWLR 5 at 9).
Compensation orders are not punitive, they are to put a party in the position they would be in but for the other party's breach of the RTA. In determining a claim for compensation, the Tribunal is to have regard to the principle against double compensation (Roberts v NSW Aboriginal Housing Office [2017] NSWCATAP 9 at [86]).
The onus of proving negligent or intentional damage rests with the landlord: Westpac General Insurance v Cooper [2006] ACTSC 91 at [14]. If a landlord seeks to prove that a tenant has caused or permitted intentional or negligent damage, they must establish a credible hypothesis as to how this damage was caused (Fitzpatrick v Wu unreported, NSWRT, 2001, 01/16425).
At the end of the tenancy the tenant must comply with the requirements of s 51(3) of the RT Act. Briefly, the tenant is to remove their goods return the keys to the landlord and leave the premises as nearly as possible in the same condition, fair wear and tear excepted and in a reasonable state of cleanliness.
"Fair wear and tear" means damage or deterioration that arises from the reasonable use of the house for its intended purpose and the ordinary operation of natural forces. The test is objective and should not be approached from the perspective of a "fastidious and obsessive landlord" (Panico v Crompton & Jennings [2015] NSWCATAP 110 at [24]).
The Tribunal must consider whether the tenant has acted in an intention or negligent manner or whether damages has come about through normal use of the property and should be classified as fair wear and tear. If the Tribunal finds that the tenants are responsible for damage then the Tribunal must determine the quantum of damage. In doing so the Tribunal will consider whether the landlord has mitigated their damage, whether damages claimed are proportionate and what depreciation is to be taken into account (ATO Guidelines).
The Tribunal must determine whether the tenant has acted in a careless or negligent manner or has the damage come through normal use of the property and should be classified as fair wear and tear.
In Hall v Hawkins [2015] NSWCATAP 197, the Appeal Panel found that s 30(1) of the RT Act does not deprive evidence other than a condition report signed by both parties, of cogency or reliability. S 30(1) does not provide a basis for rejecting or ignoring other evidence as to the state of the premises at the relevant time, where the evidence happens not to be contained in a condition report signed by both the landlord and the tenant.
I note that in her written submissions, the landlord raises a number of other provisions in the RT Act, including s 51(1), 51(2), 66, 67, 71 and 72. Some alleged breaches are not material because no compensation has been sought (for example the allegation that the tenant has removed a smoke alarm). Otherwise, I have considered these provisions but most of the allegations are capable of being characterised as a breach of s 51(3).

[7]

Utility Charge Claims - Points of Claim 3 - 10

Adopting the numbering at paragraph [5], in relation to points of claim 3 to 10, the landlord relies on a spreadsheet set out in Tab 10 of her documents to establish that the tenant has failed to pay utilities charges totalling $2,111.75.
The landlord has also supplied screenshots of the following utilities invoices shared with the tenants by email: 1. Electricity usage for the period from 21-Apr-2022 to 19-Jul-2022 - $584.69; 2. Gas usage for the period from 16-Jun-2022 to 15-Sep-2022 - $209.72; and 3. Electricity usage for the period from 20-Jul-2022 to 17-Oct-2022 - $467.76.
In addition, one email on 28-Sep-2023 from the landlord to the tenant attaches numerous utilities bills however no copies of these bills have been supplied to the Tribunal.
The supplied invoices referred to at 31 and the corresponding payments recorded in the landlord's ledger suggest that the tenant has been asked to pay both usage and supply charges. This was certainly the tenant's position during the hearing. This is inconsistent with s 40(1)(c) of the RT Act. To the extent that any provision of the RTA purports to make the tenants liable in a different manner, such provision is void by operation of s 21 of the RT Act. The parties cannot contract out of the obligation for the landlord to pay supply charges.
In the absence of the invoices for the utilities charges that the landlord seeks, I cannot make an order in the landlord's favour. The invoices establish the amounts to be paid and, in the case of all utilities other than internet, are necessary to distinguish between usage and supply charges. The supplied ledger is not sufficient to establish the tenant's liability when better evidence is available.
In addition, any utility charge for which an invoice was or ought to have been issued to the tenant prior to 20-Jun-2023 is out of time by operation of Cl 39(9) of the Residential Tenancies Regulation 2019 (NSW) (RT Regs). This clause of the regulation limits the time for a claim of breach of the RTA to 3 months. This time limit was raised by the tenant during the proceedings and is noted by the landlord in email correspondence with the tenant.
The landlord has not sought, nor been granted, an extension to this time limit. There is nothing before me that suggests that the landlord could not have sought to recover these amounts earlier and, in the absence of sufficient evidence to verify the amounts being claimed (and to distinguish between usage and supply charges) I do not consider that it is appropriate to extend time of my own motion.
Accordingly, points of claim 3 - 5 and part of 6 are dismissed as out of time. The balance of 6 as well as 7 - 10 are dismissed on the basis that there is inadequate evidence to establish the landlord's entitlement to the amounts claimed.

[8]

Repair and Cleaning Claims

It is convenient to divide the Repair and Cleaning Claims into two groups.
For each of points 11 - 21, the landlord asks the Tribunal to refer to the photographic evidence, and the (retrospectively completed) ingoing and outgoing condition reports.
For each of points 22 - 40, the landlord indicates that they identified these issues at a later stage and they are not, at least in some instances, identified in the condition reports.
In addition to their written evidence, each party was given an opportunity during the hearing to make further submissions in relation to each point of claim.
In addition to those submissions, the tenant also raised several more general issues including that: 1. The ingoing and outgoing condition reports were not completed as required; 2. The amounts sought by the landlord are excessive; 3. In relation to a number of points of claim, the landlord has not supplied evidence as to the condition of the premises at commencement of the tenancy; 4. The landlord attended the premises on a number of occasion throughout the tenancy and the issues identified after the tenancy were not raised; 5. The landlord has not provided evidence to support a number of claims including in relation to structural damage and mould; 6. There are significant variations between the amounts the landlord has sought in the proceedings, prior to the proceedings (including in email correspondence) and amounts quoted or invoiced from tradespeople; 7. She arranged a professional cleaner both throughout and at the end of the tenancy; and 8. She offered to have her cleaner and gardener re-attend the premises.
Before making findings in relation to each of the Repair and Cleaning Claims, it is convenient to address a few general issues.
In relation to the condition reports, there is no dispute that these were completed retrospectively. For this reason, they cannot be relied on for the purpose of s 30 of the RT Act. As in Hall, this does not mean the landlord cannot establish a claim on the basis of other evidence.
However, there are significant difficulties with the landlord's photographic and other evidence. It's clear that the landlord has had to review other records she has in an effort to establish the condition of the premises at commencement of the tenancy however, for quite understandable reasons, this material often shows only parts of the premises and appears to have been taken over some space of time. I do not regard the text message exchanges between the parties as either: 1. Acceptance by the tenant that the premises was impeccably clean or undamaged at commencement of the tenancy; or 2. Evidence on their own as to the condition of the premises.
As is set out later in these reasons, this presents challenges in making findings in favour of the landlord. The Tribunal is required to determine the application on the basis of the evidence before it, not on the basis of evidence which may be available if the parties had prepared or ran their case differently.
Additionally, there are some challenges in accepting the quantum of compensation sought by the landlord. On 18-Sep-2023, the landlord wrote to the tenant with an extensive list of concerns including quoted costs to rectify some of those issues.
That correspondence refers to cleaning and other works which in some cases are at a significantly reduced cost relative to the amounts sought by the landlord during the hearing. This is a challenge for the landlord because she has a common law obligation to take reasonable steps to mitigate her losses. In circumstances where she has represented to the tenant that she has obtained a quote for works, it is reasonable for the landlord to provide some explanation as to why she has now sought to resile from those lower quotes in favour of significantly higher costs.
During the hearing, the landlord indicated that she had previously worked with GSA Maintenance and the reason for engaging them for the bulk of the work was, essentially, convenience. While understandable, in my view this is not consistent with the landlord's obligation to take reasonable steps to mitigate her losses, particularly in circumstances where GSA Maintenance: 1. appears to have been based in Tasmania when the cleaning work was performed (having previously traded as Tasmania Renovations, as evidenced in the cleaning invoice issued in that name to the landlord on 22-Sep-2023); 2. has charged but is not registered for GST; 3. has given very limited particulars about the scope of some work performed, including no indication of hours or days worked; and 4. does not appear to have qualifications, skills or experience in relation to some specialist work including mould remediation.

[12]

Point of Claim 14

I am satisfied that the landlord has established a breach of s 51(3) of the RT Act in relation to this point of claim, because the tenant has failed to leave the yard in a state that is consistent with the state it was in at commencement of the tenancy, in particular because the yard is: 1. Is substantially more overgrown than it was at the start of the tenancy; and 2. Requires weeding.
In reaching this finding, I have considered the tenant's offer to have her gardener return. I consider that this offer was made in recognition that the state of the garden was not satisfactory. I have also accepted the landlord's photographic evidence, which I consider shows that the yard was in a worse condition at the end of the tenancy.
During the hearing, the landlord indicated that this work had not yet been performed. In an email to the tenant dated 16-Sep-2023, the landlord also advised that the lowest figure for the groundskeeping work obtained by the landlord was $700. This is significantly lower than the $2442 sought. The landlord has a duty to mitigate her loses. In my view, this extends to either engaging the more cost effective tradesperson, or explaining why the lower cost tradesperson was not engaged. This has not occurred and the landlord has not supplied the Tribunal with the quote that corresponds with the $700 figure. Given the time that has elapsed since the end of the tenancy and the hearing, I am also not satisfied that the supplied quotation is an accurate representation of the costs that the landlord will incur to perform further yard work.
In the absence of adequate evidence to establish the costs to remedy the breach of s 51(3) in relation to yard work, I will allow nominal compensation of $100
There is a general obligation on the Tribunal to attempt to assess damages rather than ordering nominal compensation even if the evidence available to do so is limited or incomplete however, as described in Anforth's Residential Tenancies Law and Practice 8th edition at [2.187.2(c)], this is not the case where the difficulty arises because the applicant has produced evidence of loss which has, as in this case, been rejected by the Tribunal (Ho v Powell (2000) 51 NSWLR 572; Oran Park Motor Sport P/L v Fleissig [2002] NSWCA 371 at [66]).

[14]

Point of Claim 16

I am satisfied that the tenant has failed to leave the premises reasonably clean, in breach of s 51(3) of the RT Act, however I am not satisfied that the landlord has provided adequate evidence to support the quantum of compensation sought.
I have reached conclusion that the tenant has breached s 51(3) of the RT Act on the basis of the email/text message correspondence between the parties, the supplied photographic evidence and the tenant's concession that she is liable for some cleaning costs. Specifically, I am satisfied that work required would include cleaning of: 1. the kitchen, including benchtops and cooking surfaces; 2. the outdoor deck; 3. the laundry; and 4. downstairs bedroom.
The landlord relies on the BSP Maintenance Invoice to support the quantum claimed for this point of claim. This invoice appears to be the first one issued by the business, does not include an ABN and, on a review of the Australian Business Register, there is no company or business name registration for "BSP Maintenance". The Register does appear to contain a registration for a Mr Brock Patterson, who is named on the invoice, but this is as a sole trader without any registration for GST.
The tenant has also supplied the Tribunal with an invoice she appears to have received from the landlord for end of lease cleaning work performed by Tasmania Renovations, being an unregistered business name that appears to be operated by a Leonardo Lima. Mr Lima is the sole trader who also appears to trade (again without registration) as GSA Maintenance.
Both the BSP Maintenance Invoice and the Tasmania Renovations invoice include work for cleaning the deck at the premises. It's not credible that either of Mr Lima or Mr Patterson performed this cleaning work in circumstances where the landlord's husband has, on 27-Sep-2023, sent text messages with accompanying photographs showing himself cleaning the deck and indicated that he has expended significant effort performing this cleaning.
No explanation has been given by the landlord as to why: 1. two invoices have been issued for the same work from different traders; 2. both invoices seek to recover GST for which neither trader is registered; 3. at least some of the work described in those invoices would need to be performed by both the trader and by Mr Vilimaa; or 4. both the BSP Maintenance Invoice and the Tasmanian Renovations invoice significantly exceed the cleaning costs that the landlord referred to in her email to the tenant dated 16-Sep-2023 ($600); or 5. the landlord has not supplied the Tribunal with a copy of the quote for cleaning services referred to in her email of 16-Sep-2023.
On the material before me, I am satisfied that the landlord, her husband or their family members have performed some of the cleaning work they now seek to recover costs for at the end of the tenancy. This being the case, I am not satisfied that the BSP Maintenance Invoice reflects the costs actually incurred by the landlord to remedy the tenant's breach of s 51(3) of the RT Act, nor am I satisfied that, if the landlord had a cleaning quote for $600 as she represented to the tenant on 16-Sep-2023, the landlord has taken reasonable steps to mitigate her losses.
In the absence of adequate evidence to establish the cleaning costs the landlord has incurred to remedy the tenant's breach of s 51(3) of the RT Act, I will allow nominal compensation of $100. The principles relevant to this determination are set out in relation to point of claim 14.
I do not accept the tenant's argument that the landlord should be required to have their cleaner re-attend, even if the cleaner was available to do so. There is no legal obligation for the landlord to do this and in circumstances where the landlord was plainly dissatisfied with the tenant's cleaner at first instance it is reasonable that the landlord may wish to engage another tradesperson.
The tenant argues that the cleaning of the kitchen is unnecessary because the landlord intended to proceed with renovations. I do not accept this as there is inadequate evidence to support this allegation. While I accept that she has statutory declarations from other people repeating this representation, the contents of those declarations are not based on communications between the landlord and those third parties. Accordingly, the declarations do not add anything to the tenant's own evidence on this point.

[22]

Point of Claim 24

The landlord's sworn evidence is that the floorboards are scratched and dented in a number of areas, and that they have been damaged by pet urine and faeces. The landlord notes that the cost to replace the floorboards is expensive, but submits that this is because they are Tasmanian Oak.
The landlord has also supplied text message correspondence with a tradesperson, to show that the floors were freshly sanded and stained a relatively short time prior to the tenancy.
In support of the quantum claimed, the landlord relies on the GSA Maintenance Invoice.
In reply, in addition to the general submissions that some marks and stains would amount to fair wear and tear, the tenant has supplied a text message exchange with the tradesperson who I understand to have originally installed the floors, pricing the work for supply and installation at $2200.
In relation to this point of claim, and noting that I have found in the landlord's favour in relation to point of claim 13, which covers a more limited are of the main bedroom floor and for which I consider there is better evidence to establish the alleged damage, I am not satisfied that the landlord has provided sufficient evidence to: 1. show the damage to the floorboards that is described in the relevant line item in the GSA Maintenance Invoice; and 2. establish that the floorboards were damaged by pet urine/faeces, as alleged.
I accept that there are some marks on the floor throughout the premises, however I do not consider that these go beyond fair wear and tear in a home that was used by a family with three young children as well as pets (including the landlord's dog). Wear and tear for floorboards in those circumstances can be significant.
The landlord's present characterisation of the damage is also inconsistent with the communications between the parties shortly after the end of the tenancy. On 18-Sep-2023, the landlord advised the tenant of a range of issues she hoped to have rectified at the end of the tenancy. This issue, which carries a very substantial cost, was not raised at all but other issues to do with the flooring (particular the issue raised at point of claim 13) were.
The floors were also supplied and installed by a trader other than GSA Maintenance originally and, on the basis of the text message exchanges provided by the tenant, appear to have been either supplied and installed or capable of being repaired by the alternative trader at a lower cost.
I raise this because, had I found that the landlord had established a breach by the tenant of s 51(3) on this point of claim, I would not be satisfied that the landlord has provided sufficient evidence to justify the cost claimed. There is no detail about how GSA Maintenance has arrived at the cost, for example the amount of timber used or the spaces that needed to be replaced, the hours worked, refinishing or cleaning required. The landlord has to provide evidence to support the total amount being claimed with as much precision as the subject matter reasonably permits and that has not occurred in relation to this point of claim.

[37]

Point of Claim 39

The landlord has established that the tenant has caused or negligently allowed damage to 6 of the 10 chairs at the premises, in beach of s 51(3) of the RT Act.
In reaching this finding, I have accepted the landlord's sworn evidence that the chairs were a wedding gift, received a few months before the tenancy. I also accept that the photographic evidence shows that the chairs were in very good condition at commencement of the tenancy and were, for some of the chairs, scratched and damaged at the end of the tenancy. It's not necessary to decide how this damage has occurred but it does appear consistent with damage by a pet cat.
I have considered the tenant's submissions that: 1. The landlord advised that they intended to repair the chairs, rather than replace them; and 2. The landlord did not indicate the value of the chairs, and that if this was made known to the tenant she would have left them in storage.
This does not relieve the tenant of her obligations under the RT Act.
I've decided that there's only sufficient evidence to establish the damage to 6 of the chairs because: 1. The ingoing photos supplied by the landlord appear to only show 7 of the chairs and from some distance; 2. The outgoing photos only show 9 of the chairs in any detail (though one photo does show 10 chairs); and 3. The marks on 3 of the chairs are sufficiently minor that I consider they amount to fair wear and tear, having regard to the current ATO guidelines which provide that freestanding furniture will depreciate over 13 1/3 years.
The tenant did not argue that the she did not damage the chairs. Her reply to this point of claim was in the nature of an argument in mitigation, or that the chairs were to be sold by the landlord through a garage sale. I am not satisfied that there is evidence to show that the landlord intended to sell or otherwise dispose of the chairs.
On balance, I am satisfied that: 1. There were 10 chairs in the premises; 2. The chairs were approximately 2 years old at the end of the tenancy; 3. The tenant has, on the basis of the supplied photographs, caused or negligently allowed damage to 6 of the chairs; and 4. The replacement chairs the landlord wishes to purchase appear to be of a similar style and quality to the original chairs.
I do not consider that the landlord's evidence is sufficient to establish the damage to the remaining chairs.
I will allow compensation of $2256.65, being 60% of the amount claimed by the landlord less 2 years of depreciation.

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