Kaur v INT Property Group Ltd

Reply to Appeal

1. The appeal is opposed by the Landlord, who says that the Tribunal made a just and fair decision.

Nature of an appeal

1. Section 80 of the Civil and Administrative Tribunal Act 2013 (NCAT Act) sets out the basis upon which appeals from decisions of the Tribunal may be brought. That section states that an appeal may be made as of right on any question of law or with the leave of the Appeal Panel on any other grounds (s 80(2)(b)).
2. This appeal raises a question, or error, of law. In Prendergast v Western Murray Irrigation Ltd [2014] NSWCATAP 69, without listing exhaustively possible questions of law, the Appeal Panel considered the requirements for establishing an error of law giving rise to an appeal as of right. The Appeal Panel found at [13] that errors of law included:

• whether there has been a failure to provide proper reasons;
• whether the Tribunal identified the wrong issue or asked the wrong question;
• whether a wrong principle of law had been applied;
• whether there was a failure to afford procedural fairness:
• whether the Tribunal failed to take into account mandatory considerations;
• whether the Tribunal took into account irrelevant considerations;
• whether there was no evidence to support a finding of fact;
• whether the decision was so unreasonable that no reasonable decision-maker would make it.

1. In Prendergast the Appeal Panel also stated at [12] that, in circumstances where an appellant is not legally represented, it is appropriate for the Tribunal to approach the issue by looking at the grounds of appeal generally, and to determine whether a question of law has in fact been raised, subject to any considerations of procedural fairness to the respondent that might arise.

The Decision

1. It is appropriate to set out a summary of the Decision.
2. After setting out various preliminary matters, the Tribunal refers to the evidence filed by the parties. The Tribunal then notes that "[t]here was no oral evidence".
3. That on its face appeared to be a surprising statement. Mr Root, the agent for the Landlord, who represented the Landlord at the Tribunal hearing, told us that the Tenant and he were both sworn by the Tribunal and did give oral evidence. We accept that that is the case as that is the usual course of events. However, the Appeal Panel does not know what that evidence was as neither party provided either the sound recording of the Tribunal hearing or a transcript as directed (if the party wished to rely on what happened before the Tribunal in the appeal). All we have on the face of the Decision is a statement that there was no oral evidence.
4. The Tribunal then sets out the items claimed by the Landlord being: Cleaning costs ($385), lawn repairs ($1,540), damaged garage door ($865.00), Foxtel rectification ($550), stained kitchen cupboard replacement ($1930.50) and repairs to ceilings (caused by stars struck to some of the ceilings), spot repairs to walls in some internal doors ($2,475.00).
5. The Tribunal notes that: Ms Kaur accepts some responsibility for half the costs of the quotation for cleaning costs and half the damage to the garage door at the premises.
6. The Tribunal then notes that: The Landlord indicated that it would abandon its claim for the Foxtel rectification ($550.00) and also stipulated that it would accept $2,000 (inclusive of GST) instead of $2,475 for repairs ceilings (caused by stars stuck to some of the ceilings), spot repairs to walls and some internal doors.
7. The Tribunal then concludes: Having regard to the submission made and the evidence, particularly, the ingoing/outgoing condition report, the photographs in evidence, and the quotes and invoices tendered, I find that the landlord has established that it is entitled to claim $6,720.00 against the tenant for breach of the residential tenancy agreement

Consideration

1. We noted above that in Prendergast the Appeal Panel stated that in circumstances where an appellant is not legally represented, it is appropriate for the Tribunal to determine whether a question of law has in fact been raised.
2. We have undertaken that task and we can identify at least two errors of law.
3. The first is that the reasons failed to adequately expose the Tribunal's reasoning for decision. The second is that the Tribunal failed to apply a correct principle of law.

Inadequate reasons

1. The Appeal Panel has recently set out the relevant principles in Volkswagen Group Australia Pty Ltd v Saad [2022] NSWCATAP 133 at [58] as follows: The NSW Court of Appeal in New South Wales Land and Housing Corporation v Orr [2019] NSWCA 231 (per Bell P) helpfully set out the principles relevant to adequacy of reasons at [66] - [77]. They are summarised as follows: (1) The function of the appeal court is to determine not the optimal level of detail required in reasons for a decision but rather the minimum acceptable standard. (2) The quantity (or detail) of reasons, necessary for those reasons to be adequate may vary both with the nature of the decision maker, i.e. whether or not it is a court or tribunal, and, if the latter, possibly the type of tribunal, and the nature of the question being decided. (3) As to the quality of reasons, it is generally accepted that the sheer volume of work undertaken by tribunals is such that a perhaps more relaxed standard of review of reasons is appropriate than may be the case when an appellate court is hearing an appeal from another court. (4) Even in the less formal setting of a tribunal there are certain minimum characteristics that a Tribunal's reasons must possess. These are supplied, in relation to the Tribunal, by s 62(3) of the NCAT Act which, requires there to be set out in reasons (when requested by a party): (a) the findings on material questions of fact, referring to the evidence or other material on which those findings were based, (b) the Tribunal's understanding of the applicable law, and (c) the reasoning processes that lead the Tribunal to the conclusions it made. (5) At least a basic explanation of the fundamental reasons which led the Tribunal to its conclusion is necessary. (6) It is not necessary for a judge to detail each factor which he or she has found to be relevant or irrelevant. Nor is a judge required to make an explicit finding on each disputed piece of evidence. It will be sufficient if the inference as to what is found is appropriately clear. (7) Reasons need not be elaborate. (8) Expression of conclusions in a certain sequence does not indicate a failure to consider the evidence as a whole. (9) The court should not read passages from the reasons for decision in isolation from others to which they may be related. (10) The reasons must be read fairly and as a whole. (11) The reasons recorded ought not to be inspected with a fine tooth-comb attuned to identifying error. (12) There should be a degree of tolerance for looseness in the language of the Tribunal, unhappy phrasing of the tribunal's thoughts or verbal slips.
2. Applying these principles, we are satisfied that the Tribunal failed to give adequate reasons. The Tribunal's relevant reasons are set out above at [18]. By rolling up its conclusions in that way, in relation to six separate items, it is impossible to know why the Tribunal found it was appropriate to allow, by way of example, replacement of the kitchen cupboards because of staining in the amount of $1,930.50, or indeed why any of the other amounts were awarded at all.
3. The usual starting point for the Tribunal in "bond claims" is to compare the ingoing and outgoing condition reports, compare ingoing and outgoing photographs and videos if any, hear brief sworn oral evidence, consider invoices and quotations, hear submissions, make an allowance for the age of the item and any fair wear and tear, and then determine an award of compensation having made relevant findings of fact.
4. There was evidence before the Tribunal. Taking the kitchen cupboards as an example, the evidence included the following.
5. First, the ingoing condition report, which states that at the commencement of the tenancy the kitchen cupboards were clean, undamaged and working, and in "Great order".
6. Here we note that there is no notation on the ingoing condition report that the Tenant agreed with this statement. And we do not know if there was any oral evidence about who prepared the ingoing condition report.
7. Secondly, the outgoing report, which states that "cupboards above range hood dirty and stained".
8. Thirdly, there were outgoing photographs of the cupboards. But the evidence of the staining is quite unpersuasive.
9. Fourthly, there was undated correspondence from a Cameron Gough, not addressed to anyone in particular, which states "fronts of the kitchen cupboards above cooktop are dirty and internals/stained".
10. Fifthly, the cleaning invoice in the amount of $385 includes the "cleaning of the kitchen cabinets inside and out and stains around hinges". The quotation for the "replacement of stained doors etc to Kitchen", which the Tribunal allowed in full was in the total amount of $1,930.50. It appears that the Tribunal may have awarded compensation for the cleaning of kitchen cupboards for which it also allowed a full replacement.
11. However, none of this evidence was referred to by the Tribunal with any particularity. The only general reference is set out above at [18].
12. We regret to say that we are unable to accept that the Tribunal's reasons conformed with the expectation to provide reasons that possessed the minimum acceptable standard.
13. That of itself is sufficient to dispose of the appeal which must be allowed.
14. But we will briefly mention the other error of law we observed and to which we have already alluded.

Failure to apply a correct principle of law

1. The Tribunal did not take into account the principle that where the cost of restoring or replacing property may be disproportionate to the extent of the damage, the measure of damages is the actual loss in value. In some cases, there can be a significant difference between the cost of restoring damaged property and the loss of capital value associated with that loss. In such cases, the Tribunal will assess the loss by reference to the lesser of the cost of restoration and the loss in capital value. Often the latter will be substantially less than the former and will need to take into account depreciation values.
2. If we test that proposition by reference to the kitchen cupboards, the Decision did not take into account the age of the cupboards, or state why replacement was appropriate in circumstances where repairs such as sanding and repainting may have been sufficient. Mr Root told us that the cupboards were "about" 6 years old.
3. The Tribunal made no allowance for their age.

Conclusion

1. As we have found that the reasons for decision were inadequate, the appeal must be allowed. It is not necessary to consider the Tenant's submission that the Decision was against the weight of the evidence.
2. The preferred position would be that the Appeal Panel reconsider the matter itself pursuant to s 81 of the NCAT Act. However, as oral evidence needs to be given, the matter should be remitted to the Tribunal for redetermination.

Other

1. During the course of the hearing the Tenant made an open offer to the Landlord's agent to return the whole of the bond to the Landlord. That is an amount of $2,240. We encourage the parties to have further discussions about resolving the matter without the need for a further Tribunal hearing.

Orders

1. The Appeal Panel orders: 1. The appeal is allowed. 2. The order of 1 March 2022 in matter RT 22/01581 is set aside. 3. The stay of 1 April 2022 is dissolved. 4. The matter is remitted to the Consumer and Commercial Division of the Tribunal for redetermination.

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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: 30 May 2022