Kotsakis v Hidajat

Internal appeals - legal principles

1. Internal appeals may be made as of right on a question of law, and otherwise with leave (that is, the permission) of the Appeal Panel: s 80(2), NCAT Act.
2. In Prendergast v Western Murray Irrigation Ltd [2014] NSWCATAP 69 the Appeal Panel set out at [13] a non-exclusive list of questions of law including that there was a failure to afford procedural fairness, or that there was a failure to take into account relevant (i.e. mandatory) considerations.
3. The circumstances in which the Appeal Panel may grant leave to appeal from decisions made in the Consumer and Commercial Division are limited to those set out in cl 12(1) of Schedule 4 of the NCAT Act. In such cases, the Appeal Panel must be satisfied that the appellant may have suffered a substantial miscarriage of justice on the basis that: 1. the decision of the Tribunal under appeal was not fair and equitable; or 2. the decision of the Tribunal under appeal was against the weight of evidence; or 3. significant new evidence has arisen (being evidence that was not reasonably available at the time the proceedings under appeal were being dealt with).
4. Having regard to the principles applicable to the granting of leave as set out in Collins v Urban [2014] NSWCATAP 17 at [65] - [84] (Collins v Urban), obtaining leave to appeal is a two-stage process. At the first stage the Tenant must persuade us that he may have suffered a substantial miscarriage of justice under cl 12 (1) of Schedule 4, because of one or more of the matters referred to in his grounds of appeal. In Collins v Urban, the Appeal Panel stated at [76] that a substantial miscarriage of justice for the purposes of cl 12(1) of Schedule 4 may have been suffered where: … there was a "significant possibility" or a "chance which was fairly open" that a different and more favourable result would have been achieved for the appellant had the relevant circumstance in para (a) or (b) not occurred or if the fresh evidence under para (c) had been before the Tribunal at first instance.
5. Should the Tenant persuade us that he may have suffered a substantial miscarriage of justice then at the second stage, he must persuade us that we should exercise our discretion and grant leave to appeal.
6. Ordinarily, as the Appeal Panel stated in Collins v Urban at [84], it is appropriate to grant leave to appeal only in matters that involve: (a) issues of principle; (b) questions of public importance or matters of administration or policy which might have general application; or (c) an injustice which is reasonably clear, in the sense of going beyond merely what is arguable, or an error that is plain and readily apparent which is central to the Tribunal's decision and not merely peripheral, so that it would be unjust to allow the finding to stand; (d) a factual error that was unreasonably arrived at and clearly mistaken; or (e) the Tribunal having gone about the fact finding process in such an unorthodox manner or in such a way that it was likely to produce an unfair result so that it would be in the interests of justice for it to be reviewed.

Submissions and evidence

1. In deciding the appeal, we have had regard to the following:

• The Notice of Appeal lodged on 25 August 2021 with Annexure to Notice of Appeal containing the Appellant's Grounds of Appeal and Exhibit A - Phone Record;
• The Appellant's Written Submissions dated 3 September 2021 and 9 September 2021, respectively, which were lodged by the Appellant's legal representative, Mr O'Keefe, with the Appellant's Application for stay of original decision pending appeal;
• The Reply to Appeal, including Annexure to Reply to Appeal (responding to each of the Appellant's Grounds of Appeal) which was lodged by the Landlord's agent on behalf of the Respondent on 16 September 2021;
• The Respondent's bundle of documents (12 pages) lodged on 29 October 2021;
• A copy of all directions made in this appeal, including the orders made by the Appeal Panel on 9 September 2021 when the Appellant's application for a Stay of the Original Decision was dismissed and the orders made by the Appeal Panel on 13 October 2021 extending the time for compliance with the orders made on 9 September 2021 requiring the parties to exchange their documents (including written submissions) in advance of the appeal hearing;
• A copy of the Orders and Reasons made on 12 August 2021 in the Landlord's application to the Tribunal at first instance;
• A copy of the Landlord's application to the Tribunal lodged on 29 August 2021;
• The oral submissions made by Mr O'Keefe on the Appellant's behalf and by Ms Zhang on the Respondents' behalf at the appeal hearing.

Notice of Appeal

1. The Notice of Appeal was lodged on 25 August 2021, which is within the 14 day time period specified in cl 25(3) of the Civil and Administrative Tribunal Rules 2014 NSW.

Grounds of Appeal

1. The grounds of appeal specified in the Annexure to the Notice of Appeal are:
2. The Tribunal denied procedural fairness (Ground 1);
3. The Tribunal failed to take into account a relevant consideration (Ground 2);
4. No jurisdiction (Ground 3);
5. The decision was not fair and equitable (Ground 4).
6. In oral submissions made during the appeal hearing, Mr O'Keefe on behalf of the Appellant confirmed that because the Tenant had vacated the Premises on 20 October 2021 the Appellant no longer sought to appeal the orders for termination and possession; i.e. Orders 1 - 4 made on 12 August 2021. In consequence, Mr O'Keefe said Ground 4 of the Grounds of Appeal; i.e. that it was not fair and equitable for the Tenant to be "evicted" from the Premises "during a lockdown, at the peak of the delta [COVID 19] outbreak in NSW", was not pressed at the appeal hearing.

The Appellant's Adjournment Request

1. On the morning of the appeal hearing, the Appellant's solicitors sent an email to the Appeals Registry, which stated, relevantly: We confirm that we have not filed [the Appellant's] submissions, as we did not receive a copy of the sound recording until 21 October 2021, despite applying for it on 14 September 2021. It is our submission that we need some time to go over the transcript to prepare our submissions, and then give the respondent an opportunity to respond to those submissions. In the circumstances, we propose to adjourn the Appeal Panel hearing today. We have sought consent from the respondent, which was not obtained.
2. We considered this adjournment request when the appeal hearing commenced at 2:15 pm. The Landlord's agent confirmed at that time that the Respondent opposed an adjournment of the appeal hearing.
3. In circumstances where a copy of the sound recording had been available to the Appellant's solicitor since at least 21 October 2021 (i.e. 12 days prior to the day specially fixed for the appeal hearing), the Appellant's solicitor was unable to provide a satisfactory explanation as to why he had not prepared the Appellant's submissions. Nor could he explain to us why he had not taken steps to file and serve a formal application for an adjournment of the appeal hearing and for a further extension of time to file and serve written submissions, all supported by an affidavit.
4. Despite these shortcomings, the Appellant's solicitor asked us for additional time to file and serve written submissions for the Appellant and he further suggested that the Appeal Panel could make an order pursuant to s 50(2) of the NCAT Act dispensing with an appeal hearing and proceeding to have the appeal determined on the basis of the parties' submissions including the Appellant's additional written submissions and any submissions in reply of the Respondent.
5. We were not persuaded that an adjournment to another day, with or without an order dispensing with a hearing, was warranted in the circumstances. We were also mindful of the Tribunal's guiding principle which is the just, quick and cheap resolution of the real issues in the proceedings, and of the duty of parties to Tribunal proceedings and their legal representatives. The Appellant's solicitor had a legislative obligation to co-operate with the Appeal Panel to give effect to the Tribunal's guiding principle and, for that purpose, to participate in the processes of the Tribunal and to comply with orders and directions of the Appeal Panel: s 36(3), NCAT Act.
6. We considered that the Appellant's solicitor could be afforded a reasonable opportunity to present the Appellant's case on the day of the appeal hearing and that this could be done by allowing him a short time of adjournment (in fact, as occurred, a time of up to 45 minutes), so that he could read the transcript of the Tribunal hearing on 12 August 2021, which, according to the Appellant's submission related to a hearing time of 13 minutes, and prepare oral submissions for the appeal hearing.
7. With the short adjournment, the appeal hearing resumed at 3:23 pm.

Consideration of the Appeal Grounds

1. The Appellant contended that each of the Appeal Grounds which were pressed at the appeal hearing (i.e. Grounds 1, 2 and 3), raised questions of law, in respect of which leave was not required. This contention was uncontroversial in respect of Grounds 1 and 3.
2. Ground 2 was that the Tribunal at first instance had not taken into account evidence of an understanding of the parties that the rental payments of the Tenant from 23 March 2020 (i.e. with the lockdown restrictions which came into effect at the outset of the COVID-19 pandemic) up until 14 October 2020 (i.e. when the Landlord changed their agents) were all made on the basis that "the parties would re-visit the situation in the future", such that the orders of the Tribunal of 12 August 2021 for payment of money on account of rent arrears, in particular Orders 7 and 8, had been made, according to the Appellant's submission, on a "wrong factual premise".
3. To the extent it is said in the Appellant's case that the Member at first instance did not expressly refer in the Written Reasons dated 12 August 2021 to the evidence of an alleged understanding of the parties, or that the Member erred because such evidence of an alleged understanding was a relevant (i.e. mandatory) consideration which he did not take into account, we have to determine whether that Ground 2, in fact, raises a question of law, in which case leave to appeal on that ground is not required.
4. Otherwise, Ground 2 may be put alternatively on the basis that the Member at first instance erred in the fact finding process which led to the Decision and Orders made on 12 August 2021. Ground 2 put on the alternative basis is a ground which does require leave to appeal.
5. In respect of Ground 3 (No jurisdiction), which is a question of law, the Appellant submitted that the effect of Orders 7 and 8 made on 12 August 2021 was that the Appellant as Tenant is now required to pay an aggregate amount of $18,680; that with such effect the Orders made were beyond the Tribunal's jurisdictional limit of $15,000; and further that in circumstances where the Rental Bond Board had, as directed in Order 8, already paid out to the Landlord the rental bond amount of $3,680, Order 7 irrespective of the Appeal Panel's decision in respect of Grounds 1 and 2, must be varied by substituting an amount of $11,320 for $15,000.
6. It is convenient for us to consider Ground 3 before we consider Grounds 1 and 2.

Ground 3 (No jurisdiction)

1. Section 187(4)(a) of the RT Act provides that the Tribunal must not make an order for an amount that exceeds the amount (if any) prescribed by the RT Regulation for the purposes of that section.
2. Clause 40 of the RT Regulation says: For the purposes of s 187(4)(a) of the Act, the amount prescribed is - (a) if the order is with respect to a rental bond - $30,000; (b) otherwise - $15,000.
3. The RT Regulation as to the Tribunal's monetary limit is enlivened for claims exceeding $15,000.00 when there is a claim "with respect to a rental bond". In the circumstances, we are satisfied that the Tribunal's Orders 7 and 8 were made within the terms of Clause 40 of the RT Regulation.
4. On 21 July 2021, the Tribunal granted leave to the Landlord to amend their application to include a claim for rental arrears. Thereafter, it was available to the Landlord to seek, as they did on 12 August 2021, an order for payment of an amount of money (RT Act, s 187(1)(c)) in respect of the breach by the Tenant of the residential tenancy agreement; specifically, the obligation to pay rent (RT Act, s 190(1)), as well as to seek an order with respect to payment of the rental bond amount of $3,680: see RT Act, s 175(1). An order with respect to a rental bond arises within Clause 40(a) of the RT Regulation in the circumstances of this case. As the RT Act in s 166(1)(b) makes clear, a landlord is entitled to claim from the rental bond for a residential tenancy agreement any rent owing and payable under a residential tenancy agreement.
5. To support the Appellant's Ground 3 of the appeal; i.e. that the Tribunal had no jurisdiction to make orders for an aggregate amount which exceeded $15,000 in the context of a claim for rental arrears, including a direction to the Rental Bond Board with respect to a rental bond, the Appellant's solicitor relied on Thomas v Goodbolt [2021] NSWCATAP 318 (Thomas v Goodbolt).
6. In Thomas v Goodbolt, the Appeal Panel at [71] - [73] referred to an earlier decision Bridgford v Brien [2017] NSWCATAP 111 (Bridgford v Brien). The member at first instance in Thomas v Goodbolt had cited Bridgford v Brien as authority for the proposition that the limit on the Tribunal's jurisdiction in residential tenancy matters applies distributively to each order made in respect of each cause of action and not globally to all orders sought in a particular application. The Appeal Panel in Thomas v Goodbolt then cast doubt on that proposition but without having to address any issue of jurisdiction.
7. The (obiter) observations of the Appeal Panel in Thomas v Goodbolt at [71] - [73] are therefore not pertinent to the circumstances before us, and in any case, they do not assist the Appellant in making out Ground 3 of this appeal. The applicant at first instance in Thomas v Goodbolt (a tenant) had two principal claims, in addition to claim on the rental bond. The orders made on the rental bond claim were not disturbed on appeal. However, the orders to pay money on the two principal claims totalling $20,938, which were disturbed on appeal, related, firstly, to a claim of $15,000 brought under s 187(1)(c) of the RT Act for reimbursement of the cost of a report and a rent reduction, and secondly, a claim brought under s 187(1)(d) of the RT Act in respect of damage to the tenant's property. In allowing both of the tenant's principal claims, the member at first instance in Thomas v Goodbolt had accepted the tenant's submission that the monetary limit of $15,000 applied "distributively" to each order made under subsections 187(1)(c) and 187(1)(d) respectively of the RT Act, rather than to the sum of the orders collectively. The landlord appellant on the appeal was successful in having the orders varied to an aggregate total below $15,000, so that it was then not necessary for the Appeal Panel in Thomas v Goodbolt to decide any jurisdiction issue.
8. This case, unlike Thomas v Goodbolt, involves a claim by the Landlord for rental arrears to an amount of $39,560, but in circumstances where the Landlord was prepared to waive that part of their claim as exceeded the Tribunal's jurisdictional limit. The Landlord accordingly sought an order with respect to the rental bond, which covered part payment of the arrears, as well as an order for payment of money to cover the balance of the rent arrears up to a limit of $15,000. For the reasons we have given, this is permitted under clause 40 of the RT Regulation. In this way, no jurisdictional issue now arises which requires us, as the Appellant submitted, to vary Order 7 made on 12 August 2021 by substituting $11,320 for $15,000.
9. Accordingly, Ground 3 of the appeal fails.

Ground 1 (Denial of procedural fairness)

1. The Appellant submitted that because the first instance hearing was for a period of 13 minutes the Tribunal did not consider properly, or at all, the Tenant's case that all rent payments made from 23 March 2020 were on the basis that the parties would re-visit the situation in the future, such that the orders for payment of money had an incorrect factual premise.
2. The issue in Ground 1 is whether the Appellant was deprived of the opportunity to reasonably present his case to the Tribunal but particularly with reference to his evidence about the rent payments from 23 March 2020 to 14 October 2020. We are satisfied that this issue raises a question of law for which leave to appeal is not required.
3. The Tribunal must observe the rules of natural justice: s 38(2) of the NCAT Act. That subsection expressly states that the Tribunal "is not bound by the rules of evidence and may inquire into and inform itself on any matter in such manner as it thinks fit, subject to the rules of natural justice."
4. The general law principles of procedural fairness which encompass the natural justice hearing rule are set out in s 38(5) of the NCAT Act, which relevantly provides: "The Tribunal is to take such measures as are reasonably practicable: … (c) to ensure that the parties have a reasonable opportunity to be heard or otherwise have their submissions considered in the proceedings."
5. However, the hearing rule, as s 38(5)(c) indicates, is not absolute. The Tribunal is only required to take "reasonably practicable" measures to ensure that a party has a "reasonable opportunity" to be heard. As Gleeson CJ in Re Minister for Immigration and Multicultural Affairs; Ex parte Lam [2003] HCA 6; 214 CLR 1 said at [37] in respect of procedural fairness: "...Fairness is not an abstract concept. It is essentially practical. Whether one talks in terms of procedural fairness or natural justice, the concern of the law is to avoid practical injustice."
6. Accordingly, what constitutes a "reasonable opportunity" to be heard will depend on the circumstances of each case. Giles JA put it succinctly in Brennan v New South Wales Land and Housing Corporation [2011] NSWCA 298; (2011) 83 NSWLR 23 at [63]: "...in principle, the requirements of procedural fairness are identified as a matter of law depending upon the institutional setting in which decision-making is to operate, the relevant statutory scheme, the subject matter of the decision and, as part of that analysis, the seriousness of the potential consequences of an adverse decision."
7. In our view, in respect of the Landlord's application to the Tribunal for orders under the RT Act, 13 minutes duration for the hearing of evidence and submissions is not unusual, or in and of itself, indicative of practical injustice. Apart from the actual hearing time, the Appellant as the respondent Tenant at first instance was given, by the orders and directions made on 21 July 2021, a reasonable opportunity to provide written submissions and other evidence, which he did. Those submissions and other evidence including supporting documents were taken into account by the Member: see Written Reasons dated 12 August 2021 at [2] and [3]. The Appellant was also afforded an opportunity to ask questions of the other party.
8. We do not consider that the Appellant was denied a reasonable opportunity to present his case to the Member at the hearing on 12 August 2021.
9. Ground 1 of the appeal is therefore not made out.

Ground 2 (Failure to take into account a relevant consideration)

1. In respect of Ground 2, as it is stated by the Appellant in the annexure to Notice of Appeal containing the four (4) grounds of appeal, the submission is that: "the purported outstanding rent was a central aspect of the [Member's] reasoning … the Tribunal failed to take into account the fact that all payments from 23 March 2020 were made on the basis that the parties would re-visit the situation in the future. As a result, the decision was made on a wrong factual premise".
2. In our view, this is a submission that the Tribunal erred in its fact finding to make Orders 7 and 8 on 12 August 2021. We are not persuaded that the matters stated by the Appellant as his submission in support of Ground 2 pertain to an error of law whether in the sense of a failure to take into account a relevant (i.e. mandatory) consideration, or in any other sense.
3. Accordingly, we have considered Ground 2 as a ground in respect of which the Appellant requires leave to appeal. The Appellant's case as regards Ground 2 points to a fundamental proposition which it is said that the Tribunal at first instance did not consider; i.e. that all rent payments made by the Appellant from 23 March 2020 were on the basis that the parties would re-visit the situation in the future. In the period from 23 March 2020 up to when the current managing agent for the Landlord took over (i.e. on 15 October 2020), according to the Appellant, there was an understanding between the Appellant and the previous managing agent that the situation (from which we infer is meant the situation with respect to rent arrears) would be re-visited at a future time.
4. In our opinion, it does not follow whether as a matter of fact or as a matter of law, that an "understanding" with the prior managing agent then became an "arrangement reneged on", such that the rent payments said to have been due and payable by the Tenant to the Landlord were incorrect and could not form the evidentiary basis for the Tribunal in making Orders 7 and 8 on 12 August 2021. To make out that proposition in the Appellant's case there would have to be evidence of a mutual intention for an abatement of the rent due and payable under the residential tenancy agreement. There was no such evidence. The Landlord's case for orders in respect of rental arrears clearly relied upon the rent ledger prepared by the Landlord's agents and which was included in the Landlord's bundle of documents for the hearing on 12 August 2021.
5. Put at its highest, we find that the so-called understanding to re-visit the situation was no more than an indication of the Landlord's willingness, consistent with the COVID-19 provisions of the RT Act and the RT Regulation, to negotiate with the Tenant. Absent evidence of a mutual intention for rent abatement, any understanding to re-visit the situation did not, and could not, amount to a release of the Tenant's indebtedness for rent arrears under the parties' residential tenancy agreement. The rent arrears had always continued to accrue since 14 October 2020; indeed, the Tenant had stopped paying any rent at all from 19 January 2021. At the time of the hearing, rent was paid to 14 October 2020 only.
6. The evidence before the Tribunal was that the parties had negotiated about rent during 2021 and that a rent reduction was offered but no agreement was reached. In our view, the Member's fact finding process leading to Orders 7 and 8 made on 12 August 2021 was not flawed. The findings made by the Member that the COVID-19 provisions of the RT Act and the RT Regulation did not affect the Landlord's application, were all correct. Because the Tenant had not paid rent since 19 January 2021, it was indisputably the case that the Tenant had not, as required by the RT Regulation, continued to pay at least 25% of the rent payable for the Premises since the second moratorium period had commenced.
7. In all of the circumstances, we are unable to find that the Appellant has suffered a substantial miscarriage of justice. We are satisfied that the findings of the Tribunal were not against the weight of the evidence, nor were they not fair and equitable, and there is no significant new evidence which was not reasonably available at the time of the hearing on 12 August 2021. We find that the Appellant has not been deprived of a significant possibility or of a chance which was fairly open: Collins v Urban at [76] - [79].
8. Further, even if the considerations in cl 12 of Schedule 4 of the NCAT Act had been satisfied, we would not have been inclined to grant leave pursuant to s 80(2)(b) of the NCAT Act because in our view, there is no issue of principle involved, no question of public importance, no reasonably clear injustice and there is no clear mistake nor error in the fact finding process: Collins v Urban at [84].

Conclusion and Orders

1. For the foregoing reasons, leave to appeal is refused and the appeal must be dismissed.
2. We make the following orders: 1. Leave to appeal refused. 2. Appeal 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 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: 11 November 2021