Meaning of Residential Tenancies Act 2010, section 190(1)
Source
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Catchwords
Meaning of Residential Tenancies Act 2010, section 190(1)
Judgment (2 paragraphs)
[1]
Reasons for decision
This is an appeal from a decision of a Tribunal Member given on 5 May 2016 in the Consumer and Commercial Division. The appellant was the applicant in those proceedings and her application was dismissed.
The proceedings arose from a residential tenancy agreement between the applicant as landlord and the tenant is respondent. That tenancy came to an end and it is not in dispute that possession of the premises was handed back by the respondent to the appellant on 1 September 2015. The appellant's application at first instance was filed on 26 August 2016 and orders for termination of the tenancy, payment of arrears of rent and release of the bond were sought. "Other orders" were sought in the following terms:
"Orders to vacate the property by 21/8/15. Tenant to remove all items from the premises. Clean and Tidy house and grounds. Pay all back rent."
The matter first came before the Consumer and Commercial Division on 9 September 2015. By then the respondent had handed over possession of the premises to the appellant as landlord. The consent orders involved payment of arrears of rent and release of the bond. Directions were made to ready the hearing of "… the other matters that remain in dispute" and the parties were notified that a notice with a hearing date would be sent by the Registrar.
The Registrar duly issued a notice specifying the date for hearing as 6 October 2015. The appellant sought an extension of time for filing evidence which was granted. The hearing date of 6 October 2015 was vacated as a consequence. A further notice of hearing was sent by the registrar notifying a hearing date of 26 October 2015. On that date, the matter was not ready to proceed. The presiding member adjourned the matter saying:
"The matter could not be completed in the allocated time. The respondent did not provide her evidence in compliance with Tribunal directions and the evidence she sought to tender today has not been accepted.
However, both parties in oral submissions made frequent reference to matters which were not the subject of these proceedings before me, or referred to claims which had not been documented or supported by evidence of cost."
The matter was allocated a fresh hearing date by the Registrar of 30 November 2015. On that date, the respondent failed to attend. The appellant was represented by her agent, Mr Brown. In his reasons for his decision, the member noted that the matter had previously been adjourned "partly because the matter could not be completed in the time available and partly because the applicant had not provided her evidence in accordance with Tribunal directions". He noted that the evidence had now been served and that "the interests of justice require the hearing to proceed in the absence of the respondent". He noted that the applicant sought an amount in excess of $30,000, that the Tribunal's jurisdiction was limited to $15,000 and ordered that the respondent pay to the appellant the sum of $15,000.
On 24 December 2015, the respondent applied to set aside the order made in her absence on the basis that she did not receive notice of the hearing date of 30 November 2015. On 31 December 2015, the order for the payment of $15,000 was stayed.
On 23 January 2016, the stay order was lifted and the application to set aside the orders of 30 November 2015 was dismissed.
On 25 February 2016 the respondent made a further application to set aside the order of 30 November 2015. On 21 March 2016 a Senior Member ordered that the order of 30 November 2015 for the payment of $15,000 be set aside.
The matter came on for hearing on 5 May 2016. Both parties attended. The matter was heard. The appellant's application failed. The member's order was that the application was dismissed.
In his reasons, the member noted that, "At the outset of the hearing, it was confirmed by the agent that what was being sought was compensation for damages to the premises". He referred to subsection 51(3) of the Residential Tenancies Act 2010 and noted a breach of that provision was one basis for such a claim. However, he noted that the obligation on the tenant arose "on giving vacant possession". In this instance, the application was filed on 26 August 2015, five days before giving vacant possession. He concluded therefore that the subsection 51(3) obligation had not arisen when the proceedings had commenced on 26 August 2015 and a breach of that subsection could not be relied upon as a basis for a claim for compensation.
The member observed that the appellant's claim could only be dealt with on the basis of the condition of the premises on 26 August 2015 relying on subsections 51(1)(d) or 51(2)(a).
Once again, however, the member concluded that the applicant's case foundered. He observed that, "At the hearing, no evidence as to the condition of the Premises on 26 August 2016 (sic) was led". He briefly reviewed the evidence noting that all of the evidence related to its condition after 1 September 2015 he then said:
"Even if the Tribunal were to draw and (sic) inference that little would have changed as to the condition of the premises between 26 August 2016 (sic) and 1 September 2016 (sic) [1] , the basis of the application under section 190 is that it cannot be made until after a party becomes aware of the breach. Here neither the Application nor the Applicant's evidence presented today set out the damage or lack of cleanliness known to the Respondent to be the basis of an alleged breach on 26 August 2016(sic). That he is, while the facts giving rise to the cause of action may have existed, they were not proved to have been known to the Applicant".
The appellant filed her Notice of Appeal on 13 May 2016. The grounds of appeal were not helpfully expressed. They were:
"That the claim for damages to the property in the amount of $15,000,00 be reinstated as awarded to the applicant on 30/11/15 and then following an appeal by the respondent reconfirmed by the Tribunal earlier this year".
Under the heading "Orders the NCAT appeal panel should make the appellant wrote:
"Set aside the orders of the Tribunal of 5/6/16 and arrange our new hearing as the respondent did not conform with protocol by not providing her evidence in response until the date of the hearing (5/5/16)."
At the hearing of the appeal, we attempted to identify the application on which the appellant had relied at first instance as the application dated 25 August 2015 did not appear to seek an order for compensation and so far as we could determine had not been amended. Mr Brown, the appellant's agent, informed us that he had a recollection that another application had been filed. The appellant's focus appeared to be on seeking to have the order of 30 November 2015 for the payment of $15,000 reinstated on the basis that the respondent should not have been permitted to have the order set aside and then had not complied with the Tribunal's directions in anticipation of the subsequent hearing at first instance but had filed evidence on the date of the hearing and that had caused a fairness to the appellant.
The time allowed for the disposition of the matter did not permit the appeal to be concluded and it was adjourned before us part heard.
An extensive and time-consuming search of the Tribunal's records was undertaken in an attempt to locate the additional application which Mr Brown thought had been filed. No application was located, no reference to any additional application was located and no filing fee appeared to have been paid.
We conclude that Mr Brown was in error in his recollection. However it is apparent that the proceedings at first instance did proceed on the basis that there was on foot a contested application for compensation for damage to the premises. That appears to have been understood by both parties and by the Tribunal at first instance. There appears to be no actual unfairness to either party caused by this irregularity.
The guiding principle for proceedings before the Tribunal is set out in section 36 of the Civil and Administrative Tribunal Act 2013. The Tribunal is to facilitate the "just, quick and cheap resolution of the real issues in the proceedings". Furthermore, subsection 38(4) provides that the Tribunal is to proceed with as little formality as is possible "without regard to technicalities or legal forms."
We conclude, therefore, that it is appropriate that we proceed as if the application for compensation was regularly before the Tribunal at first instance.
At the subsequent hearings of the appeal on 1 September 2016 and 4 November 2016 we sought to elucidate what the appellant's grounds of appeal were and without intending any disrespect we were not greatly assisted in that task. We drew attention to sections 51 and 190 of the Residential Tenancies Act 2010 and invited the parties to make submissions on the member's decision below where he referred to them.
We conclude that the passage from the member's reasons for decision set out above at paragraph 12 proceeds on the basis of an error of law. We consider that the member's interpretation of section 190 to mean that it prohibits the bringing of an application for compensation for damage to the property unless the applicant establishes that she knew of the facts of the damage prior to the date of the application is erroneous.
Subsection 190(1) provides as follows:
"A landlord or 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."
Regulation 22(9) provides:
"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."
Our researches have not disclosed any authority dealing with the interpretation of these provisions
However, it is now well established that in interpreting legislation, a purposive approach is to be employed. Indeed, the Interpretation Act 1987, section 33 requires it.
In our opinion, the purpose of both provisions is to establish a time limit for the bringing of an application. The limit is three months to be calculated from the point at which the relevant party (in this instance the landlord) becomes aware of the breach.
The purpose of the provision is not to make a statement about when the applicant's cause of action accrues. It does follow as a matter of logic that ordinarily an application would not be made in relation to a breach of a tenancy agreement before the innocent party becomes aware of the breach. However, as the facts of the present case suggest, it is quite conceivable that a landlord might apply for termination of a lease and possession and then add a claim for compensation. At the time of filing the application, the landlord may not have been aware of the breach giving rise to an entitlement to compensation.
In any event, on the facts of this case, it would appear that no written application for compensation was made in the application filed on 25 August 2015 but that aspect of the appellant's application was added later, it seems orally, and that would have happened when the matter was before the Tribunal after 25 August 2015.
The Tribunal Member's interpretation was central to his reasoning in dismissing the application. Absent that interpretation, he may or may not have concluded that he should draw the inference that "little would have changed as to the condition of the Premises between 26 August 2016 and 1 September 2016". Had he made that inference it would have been necessary for him to determine on the evidence whether the amount claimed or some small amount taking into account such evidence is the respondent adduced, should be ordered. But failing to consider those matters by reason of what we respectfully consider was an erroneous interpretation of subsection 190(1) amounted to an error of law stop in our opinion, the appeal must be allowed.
Also central to his reasoning was the assumed fact that the application that the member was deciding had been commenced on 25 august 2016. As our analysis of the history of the matter demonstrates, that assumption was not supported by any evidence or material in the Tribunal's records at all. On the contrary, it seems inescapable to us that the application for compensation was made orally on one of the occasions that the matter was before the Tribunal. On that basis, the application was commenced in time even on the interpretation adopted by the member below. We consider that the member proceeded on a basis for which there was no evidence at all, albeit an understandable one given the very unusual history of the matter.
On either basis, an error of law is disclosed.
Neither error of law was propounded by the appellant. However, we are conscious of our obligations in matters where the parties are unrepresented. We refer in particular to Cominos v Di Rico [2016] NSWCATAP 5 at [13] where the Appeal Panel said:
"It may be difficult for self-represented appellant's to clearly express their grounds of appeal. In such circumstances and having regard to the guiding principle, it is appropriate for the Appeal Panel to review the appellant's stated grounds of appeal, the material provided, and the decision of the Tribunal at first instance to examine whether it is possible to discern grounds that may either raise a question of law or a basis for leave to appeal. The Appeal Panel has taken such an approach in a number of cases, for instance, Khan v Kang [2014] NSWCATAP 48 and Prendergast v Western Murray Irrigation Ltd [2014] NSWCATAP 69. However, this must be balanced against the obligation to act fairly and impartially.... Relevantly, s.38(2) provides that the Tribunal 'may enquire into and inform itself on any matter in such manner as it thinks fit, subject to the rules of natural justice."
We consider that the matter should be remitted to the Tribunal member who heard the matter for further determination by him according to law and we will so order.
The next issue to arise is whether we should give directions as to whether the parties should be permitted to file further evidence. Ordinarily we would be inclined to think that that is a matter which the Tribunal Member hearing the matter should deal with. However we note that the appellant does complain on the appeal that she was deprived of an opportunity to answer the evidence filed by the respondent at the hearing on 5 May 2016. As the matter was raised before us we do consider that it is appropriate to direct that the appellant be given leave to file evidence upon which she proposes to rely in response to the evidence filed by the respondent at the hearing on 5 May 2016. By doing so we do not wish to fetter the Tribunal Member hearing the matter in the directions which he considers to be appropriate.
[2]
Endnote
In each instance that the member referred to 2016 in this quote, the reference should be to 2015. Nothing turns on that typographical error.
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
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Decision last updated: 29 June 2017