appellant. 1. Grant leave to appeal. 2. Allow the appeal. 3. Set aside the orders of Adamson J made on 11 December 2018.
Key principles
Where a statute confers a discretion on the Tribunal to terminate a social housing tenancy agreement under s 91 of the Residential Tenancies Act 2010 (NSW) after a finding that...
The Tribunal's reasons, when read as a whole and fairly, sufficiently disclosed that hardship had been taken into account in the s 91 discretion by express reference to 'all the...
Fault is not relevant to the assessment of 'undue hardship' under s 154D(3)(b) but is a relevant consideration in the separate exercise of discretion under s 91.
The obligation to give reasons under s 62(3) of the Civil and Administrative Tribunal Act 2013 (NSW) requires the Tribunal to set out findings on material questions of fact, its...
Issues before the court
Whether the Tribunal failed to take into account the mandatory relevant consideration of hardship to the tenant when exercising its discretion to...
Whether the Tribunal's reasons were inadequate to disclose that hardship had been taken into account in the s 91 discretion and how it had been...
Plain English Summary
A social housing tenant grew cannabis at her Kingscliff home twice. After the second time the Tribunal terminated her lease. It first decided she would not suffer 'undue hardship' (using a test that wrongly included how much she was at fault). Then, assuming she would suffer that hardship, it still decided to end the tenancy after looking at all the circumstances, including her health problems, the repeated offending, the effect on social housing policy and the chance she would do it again. The tenant appealed, saying the Tribunal had not properly considered her hardship when making the final decision and had not explained its thinking clearly enough. The Supreme Court agreed and sent the case back. The Court of Appeal disagreed. It said that when you read the Tribunal's whole decision you can see it had thought about the medical reports, accepted there could be serious health effects, called the case 'finely balanced', and gave her extra time to move because of those reports. That was enough to show hardship had been taken into account and weighed against the seriousness of what she had done. The Tribunal did not have to write a long essay repeating every detail. The landlord's appeal was allowed and the eviction order stands.
AI-generated legal information, not legal advice. Zoe can make mistakes. Check the cited source, and for advice about your situation consult a qualified Australian lawyer.
Susan Orr was the tenant of a social housing property at Kingscliff under a residential tenancy agreement with the New South Wales Land and Housing Corporation. In 2016 police found 31 cannabis plants at the property. Ms Orr was convicted and placed on a good behaviour bond. The Corporation applied to the Tribunal under s 91 of the Residential Tenancies Act 2010 (NSW) for a termination order. The Tribunal dismissed that first application. It accepted that Ms Orr suffered from a disability (post-traumatic stress disorder and the sequelae of a 2013 cerebral aneurysm) within the meaning of the Anti-Discrimination Act 1977 (NSW). It found that termination would be likely to result in undue hardship to her, principally because of the stress that would be caused, the possible unavailability of her local treatment network, and the risk that stress could trigger further aneurysm complications. The Tribunal therefore was not required by s 154D(1) to make a termination order and exercised its discretion against termination.
While an appeal from that first decision was still pending, police searched the property again in March 2017 and found ten cannabis plants (some two metres tall), leaf and seeds. Ms Orr pleaded guilty to a second cultivation offence and was sentenced to community service. The Corporation brought a second termination application. This time the Tribunal found that Ms Orr would not suffer undue hardship. In reaching that view the Tribunal applied the test taken from Liberian Shipping v King [1967] QB 86 that “undue” means excessive or out of proportion to the tenant’s fault. It regarded Ms Orr’s fault as substantial because she had been cultivating while the first proceedings were on foot and after the Tribunal had warned that further cultivation would likely lead to termination. The Tribunal nevertheless went on, in the alternative, to consider what it would do if (contrary to its primary finding) undue hardship was established. It expressly stated that it would consider the matter “in all the circumstances including taking into account the matters set out in Section 154E”. It referred to the absence of direct evidence of adverse effects on neighbours, the history of the tenancy, the fact that the breach of the law had occurred while termination proceedings were pending, the medical and social-work reports tendered on Ms Orr’s behalf, and its view that the likelihood of re-offending was no longer low. On that alternative basis it decided the tenancy should be terminated but, “given the length of time the tenant has resided at the premises and the material in the reports submitted on behalf of the tenant”, it allowed three months for her to find alternative accommodation.
Ms Orr appealed to the NCAT Appeal Panel. The Panel held that the Tribunal had used the wrong test for “undue hardship”. Fault is irrelevant to that threshold question; s 154D(3)(b) is designed to protect vulnerable classes of occupant from the otherwise mandatory operation of s 154D(1) regardless of the degree of fault. Nevertheless the Panel found no error in the Tribunal’s alternative exercise of the s 91 discretion and dismissed the appeal.
Ms Orr obtained leave to appeal to the Supreme Court. Adamson J held that it was not apparent from the Tribunal’s reasons that it had taken the mandatory consideration of hardship into account in the s 91 discretion, nor how it had done so. Her Honour considered that the error in the “undue hardship” test may have infected the alternative reasoning. She also held that the reasons did not comply with s 62(3) of the Civil and Administrative Tribunal Act 2013 (NSW) because they did not set out the reasoning process that led to the conclusion on the alternative basis. The Supreme Court set aside the decisions of both the Tribunal and the Appeal Panel and remitted the matter.
The Corporation sought and was granted leave to appeal to the Court of Appeal. Bell P (Ward JA agreeing) held that, read fairly and as a whole, the Tribunal’s reasons sufficiently disclosed that hardship had been taken into account in the s 91 discretion and that the evidence of hardship had been outweighed by other discretionary factors, particularly the tenant’s repeated and deliberate breach while termination proceedings were pending. The Court of Appeal granted leave, allowed the appeal and set aside Adamson J’s orders. McCallum JA dissented, essentially agreeing with the primary judge that the reasons were inadequate to permit a conclusion that the mandatory consideration had been addressed on the correct factual premise.
Why the court decided this way
Bell P began by accepting that hardship to a tenant who falls within s 154D(3)(b) is a mandatory relevant consideration in the exercise of the s 91 discretion once that gateway is opened. The President nevertheless concluded that the Tribunal had taken that consideration into account. The reasons at [4], [7] and [8] set out the medical certificate from Dr Kearney, the reports from the social worker Ms Reichert and the detailed psychosocial assessment by Kate Seers. The Tribunal expressly accepted that “the evidence suggests that the termination of her tenancy may cause the tenant hardship because her treatment is being provided locally”, that “stable accommodation will assist the management of her stress and that termination may have serious effects on her health”, and that the case was “finely balanced”. Those findings were made in the section dealing with undue hardship, yet they survived as findings of fact once the Appeal Panel corrected the legal test.
When the Tribunal turned in [9] to the alternative exercise of discretion “assuming undue hardship”, it used language that, on a fair reading, incorporated those earlier findings. It said it would decide “in all the circumstances including taking into account the matters set out in Section 154E”. The word “including” signalled that the s 154E factors were not exhaustive. The phrase “all the circumstances” necessarily embraced the position of the tenant that had occupied the bulk of the preceding paragraphs. The Tribunal then said “despite the reports in support of the tenant” it could no longer find that the likelihood of re-offending was low. The preposition “despite” is decisive: it shows the reports (whose whole thrust was the tenant’s health vulnerability and need for stable accommodation) were weighed but did not prevail. Finally, the decision to allow three months (rather than the usual 28 days permitted by s 154G) was expressly tied to “the length of time the tenant has resided at the premises and the material in the reports”. That extension could only be explained as a measure to mitigate the very hardship the reports described.
The President emphasised that reasons are not to be read in isolation or with a fine-tooth comb. The Tribunal was not required to re-state in [9] every factual finding it had already made in [4], [7] and [8]. It was sufficient that the pathway of reasoning was discernible when the document was read as a whole. The error in the “undue hardship” test did not infect the s 91 discretion because fault, while irrelevant to the former, is relevant to the latter (Cain v New South Wales Land and Housing Corporation (2014) 86 NSWLR 1 at [39]). The Tribunal was therefore entitled to treat the tenant’s deliberate re-offending while proceedings were on foot as a powerful discretionary factor.
The Court also rejected the proposition that the reasons had to demonstrate that the discretion was “unaffected by the error” in the undue-hardship test. Once it is accepted that fault is a permissible consideration at the s 91 stage, the fact that the Tribunal had earlier (erroneously) used fault to decide that hardship was not “undue” does not mean its later weighing of fault against hardship was legally flawed. The reasons, though terse, met the minimum standard required by s 62(3) of the CAT Act and by the authorities that insist only that the essential grounds of the decision be apparent so that appeal rights are not nullified (Housing Commission of New South Wales v Tatmar Pastoral Co Pty Ltd [1983] 3 NSWLR 378 at 381).
McCallum JA dissented because, in her Honour’s view, the Tribunal had essentially rejected the hardship case at the first stage as unsubstantiated assertion or evasion. To then say, at the second stage, that the tenancy should be terminated “despite the reports” without any fresh evaluation of the accepted hardship findings on the correct premise (that the hardship was undue) left the appellate court unable to know whether the mandatory consideration had been genuinely addressed. The incantation “all the circumstances” was, for the dissentient, formulaic and insufficient.
The majority view prevailed because the Court considered that the textual links between [9] and the preceding paragraphs were strong enough to satisfy the legal test for adequate reasons in a high-volume tribunal.
Before and after state of the law
Before Orr the law on “undue hardship” in the social-housing context was unsettled. Some Tribunal decisions had imported the Liberian Shipping formulation that undue hardship exists where the consequences are out of proportion to the tenant’s fault. The Appeal Panel in Orr itself corrected that approach, holding that fault is irrelevant to the s 154D(3)(b) gateway because the mandatory termination rule in s 154D(1) applies regardless of the seriousness of the breach. The Court of Appeal endorsed that correction. After Orr it is clear that the threshold question is simply whether termination is likely to result in excessive hardship to a child, an AVO-protected person or a person with a relevant disability. The tenant’s moral culpability is not part of that assessment.
The decision also clarified the relationship between the two stages. Hardship that meets the “undue” threshold remains a mandatory relevant consideration at the s 91 discretion stage, but it is only one factor. The Tribunal may still terminate if other considerations, including the protective purpose of social housing, the history of the tenancy, the likelihood of re-offending and the tenant’s fault, outweigh it.
On the adequacy-of-reasons question, Orr applied and reinforced the principles in Tatmar, Wingfoot, Wu Shan Liang and Resource Pacific Pty Ltd v Wilkinson [2013] NSWCA 33. The Court emphasised that the standard is the minimum acceptable level, not perfection. Reasons must disclose the reasoning process but, particularly in a busy tribunal, need not recite every piece of evidence or engage in an “extended intellectual dissertation”. Appellate courts must read the reasons as a whole, tolerate linguistic infelicities, and avoid combing them for error. After Orr a Tribunal can be confident that a global reference to “all the circumstances” combined with earlier detailed discussion of the relevant evidence and an outcome that is rationally consistent with that evidence will ordinarily suffice.
The decision also confirmed that the three-month extension power under s 154G can itself be used as a textual indicator that hardship has been taken into account and partially accommodated.
Key passages with plain-English translation
Paragraph [8] of the Tribunal’s reasons (quoted by Bell P at [22] of the Court of Appeal judgment): “The evidence suggests that the termination of her tenancy may cause the tenant hardship because her treatment is being provided in the vicinity of the Property … the medical evidence suggests that stable accommodation will assist the management of the respondent’s stress and that termination may have serious effects on her health … The case is finely balanced however having considered the whole of the evidence the Tribunal does not accept that there is undue hardship in the circumstances of the case.”
Plain-English translation: The Tribunal accepted that evicting her could hurt her health and her treatment, and that the case was close. But it decided the health risk was not “undue” because she was substantially at fault. That test was later held to be wrong, but the factual finding that there could be serious health effects survived.
Paragraph [9] (extracted at [25] of the Court of Appeal reasons): “In this case despite the reports in support of the tenant the Tribunal cannot find as it did on the last occasion that there is only a small likelihood the respondent will reoffend … Having regard to the whole of the circumstance the Tribunal is of the view that the tenancy should be terminated. However given the length of time the tenant has resided at the premises and the material in the reports submitted on behalf of the tenant the Tribunal will allow a period of 3 months for the tenant to find alternate accommodation …”
Plain-English translation: Even though the medical reports say eviction will harm her, the Tribunal now thinks she is likely to keep breaking the law. Looking at everything, the lease should end. But because she has lived there a long time and the reports show she is vulnerable, she can stay three months instead of the usual four weeks. The words “despite the reports” and the extra time show the Tribunal weighed her hardship but decided other factors were stronger.
Bell P at [89]: “the reference to ‘in all the circumstances’ … necessarily included the position of the respondent and the hardship that it was claimed would be occasioned to her in the event that the tenancy were terminated. This had been the principal focus of [4], [7] and [8] … Those circumstances must have, in my opinion, included the very matters that were the subject of the two findings of likely hardship in [8].”
Plain-English translation: When the Tribunal said it was looking at “all the circumstances”, it was obviously including everything it had just written about her health risks. You do not have to repeat it all again in the next paragraph.
Bell P at [99]: “The reasons of the Tribunal in the instant case cannot be said to be inadequate for failing to disclose reasoning that would have persuaded the primary judge that the discretion was not infected by the error … As was said in Tatmar … there is no duty to expound reasons so as to facilitate appeals.”
Plain-English translation: The Tribunal did not have to write its reasons in a way that would convince a judge who was looking for error. It only had to show the real reasons it decided the way it did. It did that.
What fact patterns trigger this precedent
Orr will be relevant whenever a social housing landlord seeks termination under s 91 for prohibited-drug activity and the tenant asserts that he or she (or a child or AVO-protected occupant) suffers from a disability within the Anti-Discrimination Act 1977 (NSW). The case is especially pertinent where:
the Tribunal has made positive findings about the tenant’s health vulnerabilities and the likely serious effects of eviction at the s 154D(3)(b) stage;
the Tribunal proceeds to the alternative s 91 discretion on the assumption that undue hardship exists;
the Tribunal uses global phrases such as “all the circumstances”, “despite the reports”, or grants an extension beyond 28 days under s 154G; and
an appellate court is asked to decide whether those reasons sufficiently show that the mandatory consideration of hardship was weighed.
The precedent also applies to any Tribunal decision that must be read as a whole, where the decision-maker is operating under s 62 of the CAT Act, and where the volume and speed of decision-making justify a practical rather than pedantic standard of appellate review. It is not limited to residential tenancies; the principles on adequacy of reasons are of general application to NCAT.
How later courts have treated it
The judgment itself applies Housing Commission of New South Wales v Tatmar Pastoral Co Pty Ltd [1983] 3 NSWLR 378 at [29] and [99] for the proposition that there is no duty to expound reasons so as to facilitate appeals, only to give reasons sufficient to reveal the basis of the decision. It follows Wingfoot Australia Partners Pty Ltd v Kocak (2013) 252 CLR 480 at [55] and Minister for Immigration & Ethnic Affairs v Wu Shan Liang (1996) 185 CLR 259 for the requirement to read reasons as a whole and with tolerance for looseness. It cites Cain v New South Wales Land and Housing Corporation (2014) 86 NSWLR 1 at [39] for the relevance of fault to the s 91 discretion even though fault is irrelevant to “undue hardship”. It applies House v The King (1936) 55 CLR 499 in assessing whether the discretion miscarried. No subsequent appellate treatment is discussed in the judgment because it is the present decision.
Still-open questions
The Court expressly left open whether, absent a request under s 62(2) of the CAT Act, the Tribunal is under any duty (statutory or at common law) to give reasons at all. Ward JA noted that the point had not been explored in argument and that s 62(2) might be read as implying that reasons are not required unless requested. The majority proceeded on the assumption that the reasons given had to meet the s 62(3) standard, but the underlying question remains unanswered.
It is also unclear how much detail is required when the Tribunal rejects rather than accepts evidence of hardship. In Orr the Tribunal had made positive findings of possible serious health effects; the question of what constitutes adequate reasons where the Tribunal dismisses the entirety of the hardship case as “evasive and unconvincing” was not before the Court.
The precise weight to be given to the protective purpose of social housing legislation when balanced against hardship to a disabled tenant remains an evaluative matter for the Tribunal in each case. Orr confirms that the discretion is “at large” once the mandatory considerations in s 154E are addressed, but does not prescribe a hierarchy.
Finally, the interaction between the three-month extension power in s 154G and the obligation to give reasons for that extension as an indicator of hardship consideration may require further elucidation in a case where no extension is granted.
Most people don’t realise that a seemingly cursory phrase such as “despite the reports in support of the tenant” can, when read against the detailed medical evidence set out only two paragraphs earlier, satisfy an appellate court that a mandatory relevant consideration has been weighed. The case is a powerful reminder that NCAT reasons are not to be parsed like a statute; the practical forensic context and the tribunal’s heavy caseload supply the lens through which adequacy is judged.
Judgment (17 paragraphs)
[1]
Pollard v RRR Corporation Pty Ltd [2009] NSWCA 110
Public Service Association and Professional Officers' Association Amalgamated Union of New South Wales v Secretary of the Treasury [2014] NSWCA 112
Public Service Board (NSW) v Osmond (1986) 159 CLR 656; [1986] HCA 7
R v Hunt; ex parte Sean Investments Pty Ltd (1979) 180 CLR 322
R v Kay; Ex parte Attorney-General (Qld) [2017] 2 Qd R 522; [2016] QCA 269
Re Maria Politis v Commissioner of Taxation [1988] FCA 739; 20 ATR 108
Re Minister for Immigration and Multicultural Affairs, Re; Ex parte Applicant S20/2002; Appellant S106/2002 v Minister for Immigration and Multicultural Affairs [2003] HCA 30; 77 ALJR 1165
Resource Pacific Pty Ltd v Wilkinson [2013] NSWCA 33
Soulemezis v Dudley (Holdings) Pty Ltd (1987) 10 NSWLR 247
Strbak v Newton (Court of Appeal (NSW), Samuels JA, 18 July 1989, unrep)
Sydney Supermarkets Pty Ltd v Xu (RLD) [2009] NSWADTAP 28
Wade v Burns (1966) 115 CLR 537; [1966] HCA 35
Wainohu v New South Wales (2011) 243 CLR 181; [2011] HCA 24
Weal v Bathurst City Council [2000] NSWCA 88; (2000) 111 LGERA 181
Wingfoot Australia Partners Pty Ltd v Kocak (2013) 252 CLR 480; [2013] HCA 43
Xuereb v Viola (1988) 18 NSWLR 453
Yonan v NSW Land and Housing Corporation [2017] NSWCATAP 37
Zhang v Canterbury City Council (2001) 51 NSWLR 589; [2001] NSWCA 167
Texts Cited: M Gleeson, 'Judicial Accountability' (1995) The Judicial Review 117
R Sackville, 'The Evolution of the duty of decision-makers to give reasons' (2016) 23 Australian Journal of Administrative Law 128
T F Bathurst, 'Writing Better Judgments', speech delivered to the COAT Annual Conference, 7 September 2018
New South Wales Civil and Administrative Tribunal, Annual Report 2017-2018
Category: Principal judgment
Parties: New South Wales Land and Housing Corporation (Applicant)
Susan Orr (Respondent)
Representation: Counsel:
J O'Connor, N Simpson (Applicant)
P Batley (Respondent)
[2]
Solicitors:
Legal Services Branch, Department of Family and Community Services - Housing NSW (Applicant)
Legal Aid NSW (Respondent)
File Number(s): 2019/85485
Decision under appeal Court or tribunal: Supreme Court of New South Wales
Jurisdiction: Civil
Citation: [2018] NSWSC 1909
Date of Decision: 11 December 2018
Before: Adamson J
File Number(s): 2018/349900
[3]
[Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.]
[4]
[This headnote is not to be read as part of the judgment]
The applicant landlord and respondent tenant were parties to a social housing tenancy agreement within the meaning of the Residential Tenancies Act 2010 (NSW). The tenant was charged with and convicted of cultivating cannabis at the property she tenanted. The landlord applied to the New South Wales Civil and Administrative Tribunal (the Tribunal) to have the tenancy terminated on that basis. The Tribunal found that s 154D(3)(b) of the Residential Tenancies Act was engaged because the tenant suffered a disability for the purposes of the section and a termination order would likely result in her suffering undue hardship. The effect of this was that s 154D(1) which mandates a termination order was not engaged and the Tribunal had a discretion to terminate under s 91 of the Act. The Tribunal did not exercise its discretion to terminate the tenancy.
The tenant was later again charged with and convicted of cultivating cannabis at the property. The landlord applied again to the Tribunal to have the tenancy terminated. The Tribunal on this occasion found that s 154D(3)(b) was not engaged because the respondent would not suffer undue hardship by reason of termination. The Tribunal proceeded on the basis, however, that, contrary to its conclusion, s 154D(3)(b) was in fact engaged. The Tribunal then considered whether, on that basis, the s 91 discretion to terminate should be exercised. The Tribunal determined that it should and the tenancy was terminated.
The tenant appealed to the New South Wales Civil and Administrative Tribunal Appeal Panel (the Appeal Panel). The Appeal Panel found that, while the Tribunal had erred in its interpretation of "undue hardship" for the purposes of s 154D(3)(b), the Tribunal had not erred in its exercise of its discretion under s 91. The tenant appealed to the Supreme Court. The primary judge held that it was neither apparent from the Tribunal's reasons that it took hardship (a mandatory relevant consideration) into account nor how it took hardship into account, in exercising the s 91 discretion. In particular, the primary judge held that it was questionable whether the Tribunal could have exercised its s 91 discretion unaffected by the error in the meaning it gave to "undue hardship" for the purposes of s 154D(3)(b). On these bases the primary judge allowed the appeal. The landlord sought leave to appeal to the Court of Appeal.
The issues on appeal were:
1. Whether the Tribunal had not considered a mandatory relevant consideration (namely, hardship) such that the discretion miscarried;
2. Whether the Tribunal failed to indicate that the process of evaluation for the purposes of s 91 had been properly carried out such that the discretion miscarried;
3. Whether the Tribunal's reasons were inadequate for failing to indicate whether the errors in (1) and (2) occurred.
The Court granted leave to appeal and held (Bell P, Ward JA agreeing, McCallum JA dissenting), allowing the appeal:
Per Bell P (Ward JA agreeing)
1. The Tribunal did take hardship to the tenant into account in reaching its decision. The Tribunal considered the evidence of hardship and found that the tenant may suffer hardship if the tenancy were terminated. The Tribunal had remarked that the case was finely balanced; the two matters in the balance were hardship, on the one hand, and what the Tribunal member considered to be the degree of the tenant's fault, on the other. The Tribunal stated its consideration of whether "in all the circumstances" it should exercise its discretion. The Tribunal had given weight to reports in support of the tenant relating to hardship. Further, the Tribunal had afforded to the tenant a two-month extension prior to termination in recognition of the hardship a termination order would occasion: [79]-[93] (Bell P); [109] (Ward JA).
2. The Tribunal's reasons did disclose to the requisite standard how the consideration of hardship was taken into account. While the consideration of fault in assessing "undue hardship" was found to be erroneous, fault is a relevant, if not mandatory, consideration in the exercise of the s 91 discretion. Aspects of the tenant's case on hardship were not supported by evidence. The evidence of hardship was outweighed by other discretionary considerations: [79], [94]-[98] (Bell P); [109] (Ward JA).
3. The Tribunal's reasons did not fail to disclose reasoning that would have persuaded the primary judge that the discretion was not infected by the error that it was accepted had been made as to the test of "undue hardship": [99] (Bell P); [109] (Ward JA).
Housing Commission of New South Wales v Tatmar Pastoral Co Pty Ltd [1983] 3 NSWLR 378, applied.
Per McCallum JA (dissenting)
1. The Tribunal's reasons were inadequate to permit a conclusion that the Tribunal gave consideration to the mandatory consideration of hardship in its exercise of the s 91 discretion: [120]-[136] (McCallum JA).
[5]
Judgment
BELL P: This is an application for leave to appeal from a decision of the Supreme Court (Adamson J) to set aside the decision of the Appeal Panel of the New South Wales Civil and Administrative Tribunal (the Tribunal) and to remit the matter to the Tribunal for rehearing: Orr v New South Wales Land and Housing Corporation (No 2) [2018] NSWSC 1909 (Orr (No 2)).
The subject of the proceedings is a social housing tenancy agreement (the Agreement) between the applicant landlord, New South Wales Land and Housing Corporation (the Corporation), and the respondent tenant, Ms Susan Orr (the respondent), dated 17 April 2009. The tenancy agreement provided to the respondent a leasehold interest in a property at Kingscliff, NSW (the Property).
It was common ground that the Agreement was a "social housing tenancy agreement" within the meaning of the Residential Tenancies Act 2010 (NSW) (the Act).
The litigation flows from the decision by the Tribunal to terminate the Agreement on the application of the Corporation following the respondent's second conviction for cultivation of cannabis at the Property, a subsequent unsuccessful challenge to that decision before the New South Wales Civil and Administrative Tribunal (NCAT) Appeal Panel (the Appeal Panel) and a subsequent successful challenge to that decision, with leave, in the Supreme Court. As shall be seen, an earlier application by the Corporation to terminate the Agreement following the respondent's initial conviction for cultivation of cannabis had been unsuccessful.
Leave to appeal was resisted but not strenuously so. This was understandable given that the respondent had herself called in aid questions of principle as to the proper interpretation of the Act and the context of social housing tenancies when seeking and obtaining leave, as she was required to do, before Adamson J: see Orr (No 2) at [36]. The question as to what constitutes adequacy of reasons of a tribunal such as NCAT which, according to its Annual Report, for 2017-2018, received and finalised over 66,000 applications that year alone is also of general importance.
In my opinion, a grant of leave to appeal is appropriate.
[6]
Legislative context
Section 91 of the Act provides:
"(1) The Tribunal may, on application by a landlord, make a termination order if it is satisfied that the tenant, or any person who although not a tenant is occupying or jointly occupying the residential premises, has intentionally or recklessly caused or permitted:
(a) the use of the residential premises or any property adjoining or adjacent to the premises (including any property that is available for use by the tenant in common with others) for the purposes of the manufacture, sale, cultivation or supply of any prohibited drug within the meaning of the Drug Misuse and Trafficking Act 1985 [(NSW)], or
(b) the use of the residential premises for any other unlawful purpose and that the use is sufficient to justify the termination.
(2) In considering whether to make a termination order on the ground specified in subsection (1) (b), the Tribunal may consider (but is not limited to considering) the following:
(a) the nature of the unlawful use,
(b) any previous unlawful uses,
(c) the previous history of the tenancy.
(3) The termination order may specify that the order for possession takes effect immediately.
(4) A landlord may make an application under this section without giving the tenant a termination notice.
(5) The Tribunal may make a termination order under this section that takes effect before the end of the fixed term if the residential tenancy agreement is a fixed term agreement."
Section 154D of the Act relevantly provides:
"(1) Subject to subsection (3), the Tribunal must make a termination order on the application of a landlord under a social housing tenancy agreement if:
…
(b) an application for the order is made under section 91 and the Tribunal is satisfied of the matters set out in section 91(1)(a), or
…
(3) However:
…
(b) subsections (1) and (2) do not apply if the Tribunal is satisfied that the termination order would be likely to result in undue hardship being suffered by a child, a person in whose favour an apprehended violence order could be made or a person suffering from a disability within the meaning of the Anti-Discrimination Act 1977 [(NSW)] who is occupying or jointly occupying the social housing premises, and
…
(4) For the purposes of the application of section 91(1)(b) to social housing premises under this section:
(a) the reference to residential premises in section 91(1)(b) is to be taken to be a reference to the social housing premises or any property adjoining or adjacent to the premises (including any property that is available for use by the tenant in common with others), and
…
(5) If the Tribunal does not make a termination order as a consequence of subsection (3), the Tribunal must provide written reasons for the decision."
[7]
Factual background
In 2016, NSW police searched the Property and discovered 31 cannabis plants. The respondent was subsequently charged with and convicted of the cultivation of cannabis plants and placed on a good behaviour bond.
[8]
The first termination application
In late 2016, the Corporation filed an application in the Tribunal seeking an order that the Agreement be terminated pursuant to s 91 of the Act (the first termination application).
In relation to the first termination application, the Tribunal dealt with the application of s 91 of the Act to the case as follows:
"The first issue is whether cannabis is a prohibited drug within the meaning of section 91 (a) of the Act, as section 3 of the Drug Misuse and Trafficking Act 1985 [(NSW)] excludes prohibited plants specified in Schedule 1, in which cannabis is listed. In my view, section 91 must include the cultivation of cannabis, as it would be an absurd result if it were not. … the matters the [Corporation] is required to make out in section 91(1)(a) have been proved to the Tribunal's satisfaction."
The Tribunal then determined that s 154D(3)(b) of the Act was engaged, it being found that the respondent suffered a disability (namely, post-traumatic stress disorder) within the meaning of the Anti-Discrimination Act 1977 (NSW) and that a termination order would likely result in undue hardship to the respondent for the purposes of s 154D(3)(b) of the Act. In particular, the Tribunal determined that terminating the Agreement may cause the respondent undue stress and that the effect of stress on the respondent may be extreme. The Tribunal found that there was a possibility that the therapy in which the respondent was engaged may not be available to her were the Agreement terminated. This was identified as a risk both to the respondent and to the community. The Tribunal also found that "[t]he risk of the respondent again using cannabis [was] low, and the risk of her cultivating cannabis at the premises [was] even lower". The Tribunal dismissed the first termination application on 15 February 2017.
The Corporation lodged an appeal from this decision but, on 9 March 2017, at a time when the appeal was pending, the NSW Police again searched the Property and discovered a quantity of cannabis leaf and seeds on the premises together with ten cannabis plants, seven of which were 2 metres tall. The respondent ultimately pleaded guilty to cultivating cannabis on 17 May 2017 and was given a community service order.
The appeal from the first decision was withdrawn and formally dismissed on 28 July 2017 but, in light of the second conviction, the Corporation made a second application to the Tribunal for a termination of the Agreement pursuant to s 91 of the Act (the second termination application).
[9]
The second termination application
At this hearing, it was not disputed that s 91(1)(a) of the Act was satisfied and it was common ground or accepted that the respondent suffered a disability within the meaning of the Anti-Discrimination Act and the meaning of s 154D(3) of the Act. The relevance of this was that it meant that the Tribunal was not bound to make a termination order pursuant to s 154D(1) of the Act if it was satisfied that the termination order, if made, would be likely to result in undue hardship being suffered by the respondent.
The Tribunal on this occasion determined that the respondent was not likely to suffer undue hardship as a result of a termination order for the purposes of s 154D(3) of the Act. In reaching this conclusion, the Tribunal stated (at [6]) that:
"Undue hardship is not defined in the [Residential Tenancies Act]. In Liberian Shipping v King [1967] QB 86, Lord Denning MR held "Undue' .. simply means excessive. It means greater hardship than the circumstances warrant. Even though a claimant has been at fault himself, it is an undue hardship on him if the consequences are out of proportion to his fault.""
In its reasons, the Tribunal recorded (at [4]) that:
"It was claimed that the stress of being terminated and the difficulty of finding private rental accommodation could cause a reoccurrence of a cerebral aneurism that she had suffered in 2013. It was also claimed that the tenant would have difficulty obtaining alternative accommodation because of her 3 dogs and 2 cats. There was no evidence given of any attempts by the tenant to obtain alternate accommodation either privately or with another social housing provider. There was no evidence of the cost of alternate accommodation or the availability of alternate accommodation with or without pets. A number of assertions were made from the hearing room table by Mr Wykeham but that is not evidence. The tenant had been residing in the premises for 7 years and in other social housing premises for the 10 years before that. The [t]enant was in receipt of a pension of $800 a fortnight. There was no evidence of any alleged breach of the residential tenancy agreement apart from the 2 episodes of cultivation. Whilst there were 3 previous convictions for cultivation there was no evidence that those previous convictions involved cultivation at the subject premises. The Tribunal found the tenant[']s evidence evasive and unconvincing particularly in relation to the period of time she had been cultivating the plants the subject of these proceedings."
[10]
The Appeal Panel
The respondent then appealed the Tribunal's decision to the Appeal Panel, pursuant to s 80 of the Civil and Administrative Tribunal Act 2013 (NSW) (the CAT Act).
The terms of s 80 should be noted at this point because they have some relevance to the content of reasons required of a Tribunal member: see, for example, Housing Commission of New South Wales v Tatmar Pastoral Co Pty Ltd [1983] 3 NSWLR 378 at 381 (Tatmar) where Hutley JA (with whom Samuels JA agreed), said that a "court must not nullify rights of appeal by giving no or nominal reasons, but there is no duty to expound reasons so as to facilitate appeals." See also Pettitt v Dunkley [1971] 1 NSWLR 376; Campbelltown City Council v Vegan (2006) 67 NSWLR 372; [2006] NSWCA 284 at [24], [105]; Wingfoot Australia Partners Pty Ltd v Kocak (2013) 252 CLR 480; [2013] HCA 43 at [55] (Wingfoot).
Section 80 of the CAT Act provides that:
"(1) An appeal against an internally appealable decision may be made to an Appeal Panel by a party to the proceedings in which the decision is made.
(2) Any internal appeal may be made:
(a) in the case of an interlocutory decision of the Tribunal at first instance - with the leave of the Appeal Panel, and
(b) in the case of any other kind of decision (including an ancillary decision) of the Tribunal at first instance - as of right on any question of law, or with the leave of the Appeal Panel, on any other grounds.
(3) The Appeal Panel may:
(a) decide to deal with the internal appeal by way of a new hearing if it considers that the grounds for the appeal warrant a new hearing, and
(b) permit such fresh evidence, or evidence in addition to or in substitution for the evidence received by the Tribunal at first instance, to be given in the new hearing as it considers appropriate in the circumstances."
The respondent raised four grounds of appeal:
1. The Tribunal erred in its interpretation and application of s 154D(3)(b) of the Act;
2. The Tribunal erred in law in its interpretation and application of the s 91 discretion and/or the mandatory considerations in s 154E of the Act;
3. The Tribunal erred in law by making findings of fact for which there was no probative evidence (namely, as to neighbouring residents suffering serious adverse effects in the future were the tenancy not terminated); and
4. The Tribunal failed to give adequate reasons.
The respondent also sought leave to appeal on the basis that the Tribunal's finding that termination would not cause undue hardship was against the weight of evidence (pursuant to Sch 4, cl 12(1)(b) of the CAT Act).
[11]
Proceedings in the Supreme Court
By summons filed 14 November 2018, the respondent sought leave to appeal the Appeal Panel's decision in the Supreme Court on the following bases:
1. The Appeal Panel erred in law in its finding that the Tribunal was aware that it had a general discretion under s 91 of the Act and was not limited to considering the factors listed in s 154E(1) of the Act when considering whether to terminate the tenancy;
2. The Appeal Panel erred in law in its finding that the Tribunal had not drawn the inference that neighbouring residents will suffer serious adverse effects in future if the tenancy was not terminated; and
3. The Appeal Panel erred in law in finding that the Tribunal's reasons were not inadequate.
The matter came before Adamson J sitting in the Common Law Division in December 2018. Her Honour, for the reasons set out below, granted the respondent leave to appeal, set aside the Appeal Panel's decision and orders, set aside the Tribunal's decision and orders from the second termination application and ordered that the matter be remitted to the Tribunal for rehearing.
As to the respondent's first ground of appeal, Adamson J was not persuaded that there was any error in the Appeal Panel's analysis of the statutory framework. Her Honour held (at [44]) that "[t]he Appeal Panel plainly appreciated that, in circumstances where s 154D(3) [of the Act] did not apply so as to mandate termination, there was a discretion to terminate the tenancy under s 91 [of the Act], to which s 154E [of the Act] applied." Her Honour observed that, to the extent they were relevant, the Tribunal appeared to have considered each of the s 154E of the Act matters.
These findings were sufficient to dispose of the first ground of appeal to the Supreme Court. Her Honour explained (at [47]), however, that she did not consider it clear that the Tribunal took hardship to the respondent into account as a factor relevant to the exercise of its discretion under s 91 of the Act (contrary to the Appeal Panel's finding). Her Honour then identified the relevant question as whether the hardship that would be occasioned by termination was a mandatory relevant consideration, such that the Tribunal's discretion miscarried, citing Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1986) 162 CLR 24 at 39-40; [1986] HCA 40 for the principle that mandatory considerations, where not expressly stated, must be implied from the subject matter, scope and purpose of the relevant legislation. Her Honour concluded at [49] of her judgment that hardship to a tenant occasioned by termination is a mandatory relevant consideration when the Tribunal is considering whether to terminate a social housing tenancy in circumstances where the tenant is in occupation of the premises, falls within the descriptors of s 154D(3)(b) of the Act and likely would experience undue hardship were a termination order made. So much may be accepted and indeed was accepted by the parties in this Court.
[12]
The present appeal
The Corporation pressed four grounds of appeal from the decision of Adamson J. It was put that the primary judge erred in finding that:
1. The Tribunal had not considered a mandatory relevant consideration (namely, hardship) such that the discretion miscarried;
2. The Tribunal failed to indicate the process of evaluation for the purposes of s 91 of the Act had been properly carried out such that the discretion miscarried;
3. The Tribunal's reasons were inadequate for failing to indicate whether hardship was taken into account in exercising the s 91 discretion;
4. The reasons issued by the Tribunal were inadequate for failing to indicate that the process of evaluation for the purposes of s 91 of the Act had been properly carried out.
Distilled to their essence, these four grounds really amount to a challenge to the conclusions of Adamson J summarised in those portions of the judgment that have been extracted at [50] and [51] above.
[13]
Submissions
The Corporation submitted, first, that there is no common law obligation on an administrative tribunal to give reasons: Public Service Board (NSW) v Osmond (1986) 159 CLR 656 at 662; [1986] HCA 7; Wingfoot at 497-8 but accepted that, in the ordinary course, it is a requirement that a judicial officer give reasons for his or her decisions. The Corporation acknowledged that the Tribunal exercised both administrative power and judicial power, and accepted that the Tribunal in the present case exercised judicial power, citing Attorney General for New South Wales v Gatsby [2018] NSWCA 254; 361 ALR 570 at [126]-[137] (Gatsby).
The Corporation also accepted that where an administrative tribunal exercises judicial power and there is a right of appeal from the tribunal but no statutory obligation to provide reasons, there is implied a statutory obligation to provide reasons sufficient to enable the case to be properly put before the appellate court, citing Campbelltown City Council v Vegan (2006) 67 NSWLR 372; [2006] NSWCA 284 at [98]-[130].
The Corporation then submitted that:
"When the Reasons are read as a whole, the reasons given by the Tribunal for exercising the discretion under s91 met the mandatory requirements of s62 for the giving of reasons, reached a minimum acceptable level to constitute a proper exercise of judicial power and articulated the essential ground or grounds upon which the Tribunal exercised the discretion." (Footnote omitted)
In particular it was contended that the Tribunal considered the respondent's submission that she would suffer undue hardship if a termination order were made in determining whether to exercise its discretion under s 91 of the Act. The Corporation noted that the Tribunal referred to medical and social worker reports upon which the respondent relied in support of her submission that she would suffer undue hardship. The Corporation also drew attention to the Tribunal's express noting of matters for which there was no evidence that may otherwise have borne upon whether or not the respondent was likely to suffer hardship. The Corporation pointed out that the Tribunal found that a termination order would likely have adverse effects on the respondent's health.
It was then put that the Tribunal captured each of those considerations by its reference in [9] of its reasons to "all the circumstances" in considering whether to exercise the s 91 discretion. In support of that submission, the Corporation referred to the well-established proposition that reasons must be read as a whole and considered fairly and not narrowly: Minister for Immigration & Ethnic Affairs v Wu Shan Liang (1996) 185 CLR 259; [1996] HCA 6 (Wu Shan Liang) and submitted that "[i]t was not necessary for the Tribunal when exercising the discretion pursuant to s91 to again refer in detail to that evidence, especially in circumstances where it is clear the evidence had been considered by the Tribunal", citing Pollard v RRR Corporation Pty Ltd [2009] NSWCA 110 at [62] (Pollard).
[14]
Relevant principles
One may begin with the observation that the quality of a court or tribunal's reasons can vary immensely, of course, depending upon a range of considerations including the experience and skill of a judicial officer or tribunal member, the complexity of the subject matter, the quality of the submissions made before the court or tribunal, the availability of transcript, the urgency of the matter and the time the judicial officer or tribunal member has to compose his or her reasons. Further, good judgment writing is an art not a science (see TF Bathurst, "Writing Better Judgments", speech delivered to the COAT NSW Annual Conference "Efficient, Informal and Fair: Tribunals Delivering Under Pressure").
In the context of appellate review of the adequacy of reasons, the function of an appellate court is to determine not the optimal level of detail required in reasons for a decision but rather the minimum acceptable standard: Resource Pacific Pty Ltd v Wilkinson [2013] NSWCA 33 at [48] (Resource Pacific). The standard is not one of perfection: Bisley Investment Corporation v Australian Broadcasting Tribunal (1982) 40 ALR 233 at 255 (Bisley).
Whilst all decision makers, be they judges or tribunal members, should aspire to high quality decision making, an integral part of which is the formulation of clear reasons for decision (as Gleeson CJ explained extra-judicially in "Judicial Accountability" (1995) The Judicial Review 117 at 122), as Basten JA said in Resource Pacific at [48], "[t]ransparency in decision-making is an important value, but it is not cost free, and may involve separate parameters of quantity and quality." His Honour's identification of separate parameters of quantity and quality is, with respect, a useful one.
In terms of the former parameter, 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 of tribunal, and, if the latter, possibly the type of tribunal, and the nature of the question being decided: Wainohu v New South Wales (2011) 243 CLR 181; [2011] HCA 24 at [56] per French CJ and Kiefel J (Wainohu). Thus even superior courts are not required to give reasons for every interlocutory decision: Wainohu at [56], [98], Hogan v Hinch (2011) 243 CLR 506; [2011] HCA 4 at [42]; Lodhi v Attorney General (NSW) [2013] NSWCA 433; 241 A Crim R 477 at [29]; R v Kay; Ex parte Attorney-General (Qld) [2017] 2 Qd R 522; [2016] QCA 269 at [27]) and other aspects of decision making such as findings on pure credibility or matters that necessarily call for estimation or impression may require less or only allow for limited reasoning to be exposed: Soulemezis v Dudley (Holdings) Pty Ltd (1987) 10 NSWLR 247 at 280 but cf. Camden v McKenzie [2008] 1 Qd R 39; [2007] QCA 136 at [34], Pollard at [65] and see the discussion in Resource Pacific at [48]−[58].
[15]
Analysis
It is with the foregoing principles in mind that I turn to consider whether or not Adamson J erred in her conclusion that the Tribunal did not take hardship into account in reaching its discretionary decision to terminate the Agreement and therefore did not explain how hardship was taken into account.
With great respect to her Honour who produced a detailed written judgment within a day of the hearing of the matter, in my opinion, the Tribunal did take hardship to the respondent into account in reaching its decision. It is also my opinion that, having regard to the principles I have referred to above and in particular those stated in [73]−[77], the Tribunal's reasons did disclose to the requisite standard how that consideration was taken into account.
The starting point is that "undue hardship" within the meaning of s 154D(3)(b) of the Act is what needs to be established to open a gateway to a discretionary consideration of a termination application under s 91 of the Act; if "undue hardship" is not established, the termination of the tenancy is mandatory under s 154D(1) of the Act.
No doubt the hardship which, ex hypothesi, will have been established to the requisite degree to open this gateway will remain relevant in the exercise of any discretion pursuant to s 91 of the Act and, although not mentioned in terms as a mandatory consideration to be taken into account in s 154E of the Act, may be mandatory in a case such as the present where the gateway has been opened, a matter which was accepted by the Corporation in the present case and held to be the case by Adamson J: see [41] above.
But hardship can only be one factor which falls for consideration in the exercise of the relevant discretion under s 91 of the Act. Were it otherwise, the existence of the discretion would be compromised. The degree of its significance in any given case will be a function not of any legal characterisation for the purposes of s 154D(3)(b) of the Act as to whether the hardship was "undue", but by reference to the quality or extent of the hardship in fact demonstrated in the evidence before the Tribunal on the termination application as one of a number of mandatory and other permitted relevant considerations that fall for consideration in the exercise of the Tribunal's discretion.
The Tribunal considered the evidence of hardship to the respondent of the Agreement being terminated in [4], [7] and [8] of its decision which have been extracted at [19]−[22]. In particular, reference may be made to the following three matters:
1. the fact that the respondent suffered post-traumatic stress disorder: see [4] of the reasons;
2. the conclusion that the "evidence suggests that the termination of her tenancy may cause the tenant hardship because her treatment is being provided locally to where she currently resides": see [8] of the reasons; and
3. the conclusion that the "medical evidence suggests that stable accommodation will assist the management of her stress and that termination may have serious adverse effects on her health": also see [8] of the reasons.
[16]
Conclusion and orders
For the foregoing reasons, I would make the following orders:
1. Grant leave to appeal.
2. Allow the appeal.
3. Set aside the orders of Adamson J made on 11 December 2018.
I note that, in the draft Notice of Appeal, no orders in respect of costs were sought either in relation to the application for leave, the appeal or the proceedings below.
WARD JA: I agree with Bell P that, for the reasons his Honour gives, leave to appeal should be granted and the appeal should be allowed. I also agree with the orders his Honour proposes. I would simply add the following observations.
As his Honour has noted, the question before this Court was as to what constitutes adequacy of reasons of a tribunal such as the New South Wales Civil and Administrative Tribunal (NCAT). What was not explored in this Court (and appears not to have been explored in argument before the primary judge) was as to whether there was any duty (statutory or otherwise) on the part of the Tribunal (including when constituted as an Appeal Panel) to give reasons in the circumstances of the present case; and, if not, what flowed from that in terms of the adequacy of the reasons that were given but that, on that hypothesis, there was no duty to give. The issue is by no means a simple one but it was simply not explored, and hence it is inappropriate to reach any concluded view on it, in the present case.
The issue arises because the statutory obligation on the part of the Tribunal to provide written reasons arises pursuant to s 62 of the Civil and Administrative Tribunal Act 2013 (NSW) (NCAT Act) only when a party requests the provision of a written statement of reasons for the Tribunal's decision. Section 62(2) of the NCAT Act does not in terms contemplate that reasons will necessarily be given in the absence of such a request (and in the present case it is not possible on the material before this Court to determine whether any such request was made).
In Collins v Urban [2014] NSWCATAP 17, the Appeal Panel held (at [47]) that s 62 of the NCAT Act establishes a regime under which the Tribunal is not under an express statutory obligation to provide reasons for a decision unless a party makes a request for reasons under s 62(2) but noted that in many cases the Tribunal does prepare and give reasons for decision without a request so to do from the parties. The Appeal Panel went on to observe that a provision such as s 62 of the NCAT Act does not define exhaustively when there is a duty to give reasons or the extent of that duty. The Appeal Panel concluded that one reason why reasons are generally required is because the right of appeal would be rendered nugatory if the appellate body did not have a written statement of reasons, the Appeal Panel referring to decisions such as that of the Appeal Panel in Sydney Supermarkets Pty Ltd v Xu (RLD) [2009] NSWADTAP 28. In Sydney Supermarkets Pty Ltd v Xu, it was held that if the Tribunal gives reasons it must comply with the statutory requirements (the Appeal Panel there considering s 89 of the Administrative Decisions Tribunal Act 1997 (NSW), which has now been repealed) but the Appeal Panel was not called upon to explore the source of the obligation to give reasons. (As to what the statement of claim must now contain - see s 62(3) of the NCAT Act.)
[17]
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: 19 September 2019
1. Grant leave to appeal. 2. Allow the appeal. 3. Set aside the orders of Adamson J made on 11 December 2018.
It was common ground that, in the event that the Tribunal reached the conclusion that a termination order would be likely to result in undue hardship for a tenant falling within one of the classes of persons identified in s 154D(3) of the Act, that did not mean that a termination order pursuant to s 91 of the Act could not be made in the exercise of the Tribunal's discretion. It simply meant that the Tribunal was not bound to terminate the tenancy pursuant to s 154D(1) of the Act.
Section 154E of the Act provides:
"(1) In considering whether to make a termination order for a social housing tenancy agreement, the Tribunal must have regard to the following:
(a) the effect the tenancy has had on neighbouring residents or other persons,
(b) the likelihood that neighbouring residents or other persons will suffer serious adverse effects in the future if the tenancy is not terminated,
(c) the landlord's responsibility to its other tenants,
(d) the history of the current tenancy and any prior tenancy arising under a social housing tenancy agreement with the same or a different landlord,
(e) whether the tenant, wilfully or otherwise, is or has been in breach of an order of the Tribunal.
(2) This section does not limit any other matter that may be considered by the Tribunal under this Act."
Having set out the relevant legislative provisions, the Tribunal noted (at [7]) that:
"The tenant's case was supported by a number of reports. A medical certificate from Dr Kearney dated 27 Mar[ch] 2017 describes how tenant self-managing her stress with the use of pot and refers to a life threatening ruptured cerebral haemorrhage in 06/2013 and asserts that the prospect of losing her house is creating significant stress which is putting her at further risk from her cerebral haemorrhage. A second report of the same day asserts that the prospect of her losing her home would place her under financial stress further aggravating her risks of a major medical catastrophe and that she needs to reside in the area because all her support network is here. A further report of the 10th August asserts that her cerebral aneurysm has caused some cognitive effects + contributed to the trouble that may occur if she grew pot at property again. A further report of 25 September is to the same effect. A report from Ms Reichert a social worker dated 11 April 2017 asserted that the tenant reported in September ceasing all cannabis use following her then most recent arrest and that she had asked for counselling which had been provided focusing on relapse prevention and stress management. A detailed psychosocial assessment by Kate Seers of Client Assessment and Referral NSW Legal Aid Commission outlines in detail the tenant[']s history and concludes by emphasi[s]ing the importance of a safe and predictable environment, the importance of a supportive network and the importance of the tenant[']s pets to her wellbeing."
In [8] of the reasons, the Tribunal said that the evidence suggested that the termination of the Agreement may cause the respondent hardship because her treatment was being provided in the vicinity of the Property but noted that the respondent was unable to say when she last saw her counsellor and that there was no evidence that she would have to leave the area were the Agreement terminated. The Tribunal also noted there was no evidence that the counselling and other medical treatment the respondent needed could not be provided elsewhere. The Tribunal also noted that there was no evidence of any attempts by the respondent to find alternative accommodation.
On the other hand, the Tribunal accepted that the medical evidence suggested that stable accommodation would assist the management of the respondent's stress and that termination may have serious effects on her health. The Tribunal then continued:
"Given the height of the plants found of 9th March the Tribunal finds that it is more probable than not that the tenant was cultivating the plants at the time of the Tribunal hearing on the 23rd January 2017. And certainly was at the time the Tribunal gave judgment on the 15th February 2017 stating that any further cultivation would likely lead to termination. The tenant told the police that the plants were her daughters which suggest she had a consciousness of the seriousness of her situation on the 9th March when the plants were found. At that time the Tribunal had handed down its decision in the earlier proceedings stating 'given the likelihood that such reoffending would result in termination of the tenancy.' The Tribunal does not accept the tenant's assertions that she did not understand the seriousness of her positon if she continued to cultivate cannabis. In determining undue hardship the Tribunal must have regard to whether the consequences are out of proportion to the tenant[']s fault. The tenant[']s fault is substantial she was cultivating cannabis on the premises for a second time whilst proceedings were on foot to terminate her tenancy for that very thing. The case is finally [sic; scil. finely] balanced however having considered the whole of the evidence the Tribunal does not accept that there is undue hardship in the circumstances of the case."
It is plain that the Tribunal applied a definition or understanding of "undue hardship" derived from the passage in Liberian Shipping v King set out in [18] above for the purposes of its assessment as to whether or not "undue hardship" would be likely to be suffered by the respondent in the event a termination order was made. The Tribunal's conclusion that there would not be "undue hardship" had the result, in the circumstances of the case, that the termination of the Agreement was mandatory pursuant to s 154D(1) of the Act.
Notwithstanding the Tribunal's conclusion as to the absence of "undue hardship", because it accepted that the matter was "finely balanced" and that "others may be of a different opinion" as to the existence or otherwise of "undue hardship", it proceeded to consider whether or not, on the assumption (contrary to its conclusion) that undue hardship had been established, the Agreement should still be terminated as a matter of discretion "in all the circumstances" of the case "including taking into account the matters set out in Section 154E" of the Act. The Tribunal's reference to "all the circumstances" and the word "including" were significant, for reasons that I explain in [89] below.
In [9] of its reasons, which was ultimately of critical importance in the decision of Adamson J and which dealt with how the Tribunal would have exercised its discretion in the event that the respondent had established "undue hardship", the Tribunal held that:
"There is no direct evidence of the effect on neighbouring residents or adverse effects on the landlord['s] other tenants. However as was pointed out by the Appeal Panel in NSW [L]and & Housing v Raglione [2015] NSWCATAP 75 (5 May 2015) at 51 the serious penalties the Parliament has proscribed under the Drugs Misuse and Trafficking Act 1985 (in that case supply of Methamphetamine but the same reasoning must apply to the cultivation of cannabis) means Parliament has treated breach of that Act as a serious threat to our society. Society of course includes neighbouring residents and the landlord[']s other tenants. There is evidence of the history of the tenancy. On one side of the ledger the previous cultivation at the premises and on the other side the fact that there is no evidence of any other alleged breach over a significant period of time. The tenant has not been in breach of an order of the Tribunal but has been in breach of the law in a significant respect in cultivating cannabis at the premises whilst proceedings were on foot to have her evicted for that very thing. In this case despite the reports in support of the tenant the Tribunal cannot find as it did on the last occasion that there is only a small likelihood the respondent will reoffend by way of again consuming cannabis and an even lower likelihood she will reoffend by way again of cultivating cannabis at the premises. Having [regard] to the whole of the circumstance the Tribunal is of the view that the tenancy should be terminated. However given the length of time the tenant has resided at the premises and the material in the reports submitted on behalf of the tenant the Tribunal will allow a period of 3 months for the tenant to find alternate accommodation and orders will be made accordingly."
The reference in the final sentence of this paragraph to allowing three months for the tenant to find alternative accommodation is to be understood in the context of s 154G of the Act which provides that:
"(1) If an order is made for termination of a social housing tenancy agreement, the order for possession must not specify a day that the order for possession is to take effect that is later than 28 days after the day on which the termination order is made unless the Tribunal is satisfied that there are exceptional circumstances justifying a later day.
(2) The order for possession cannot be suspended for a period that would result in it taking effect later than 28 days after the day on which the termination order was made unless the Tribunal is satisfied that there are exceptional circumstances justifying a longer period of suspension."
For reasons that will be explained, this last sentence of the Tribunal's decision also assumes importance in considering the judgment of Adamson J.
The Appeal Panel found that the Tribunal's interpretation of undue hardship failed to capture the specific regard to the impact of termination of social tenancy on a person with a disability mandated by s 154D(3) of the Act: [2018] NSWCATAP 237. It is worth noting the analysis of the Appeal Panel not only because it has some residual relevance to the matters on appeal to this Court but also because I consider that it is correct. After noting at [49] that:
"In this appeal there was no dispute that 'undue hardship' for the purposes of s 154D(3)(b) means 'hardship that is excessive in the circumstances'. We agree that such an interpretation is consistent with the ordinary meaning of the phrase. However, the fact that the phrase 'undue hardship' in other legislation has been interpreted to mean 'hardship out of proportion to fault' does not mean that this is the correct interpretation of the phrase for the purposes of s 154D(3) of the [Act]".
The Panel continued at [52]−[54] as follows:
"There is no requirement that the use of the premises by a social housing tenant for the manufacture, sale, cultivation or supply of any prohibited drug be of any particular level of seriousness before termination of the agreement is mandatory in accordance with s 154D(1). Nor is a charge or a conviction required for s 91(1)(a) to be established. Therefore, whether a social housing tenant cultivates one cannabis plant for personal use and faces no charges or manufactures a large quantity of methamphetamines for the purpose of supply and is convicted and sentenced to a term of imprisonment, termination of the tenancy agreement is mandatory unless s 154D(3) is engaged.
The purpose of 154D(3) is to mitigate the harsh consequences of s 154D(1) for defined categories of people who occupy social housing premises in circumstances where an order for termination would otherwise be mandatory regardless of the degree of fault of the social housing tenant. For s 154D(3) to be engaged, the Tribunal must be satisfied that termination of the agreement is likely to cause undue hardship to a person who falls into one of the specified categories and who is occupying the premises. That person may or may not be the tenant. Each of these categories involves a person who may be regarded as less capable than others of dealing with the hardships that may ordinarily arise from the termination of a social housing tenancy. Section 154D(3) therefore requires specific consideration of the impact of termination of the social housing tenancy agreement on a child, a victim of domestic violence or a person with a disability.
Given that termination of a social housing tenancy agreement under s 91(1)(a) would otherwise be mandatory regardless of the tenant's degree of fault, an interpretation of 'undue hardship' that involves 'consequences out of proportion to the tenant's fault' is, in our view, inconsistent with the purpose of s 154D(3)(b). The Liberian Shipping [v King] line of authority concerning the meaning of undue hardship can be distinguished from the use of the phrase in s 154D(3), as the conduct of the party seeking the extension of time is clearly relevant to the reasons for a delay in commencing proceedings and accordingly to the issue of whether an extension of time should be granted."
Interpolating here, whilst the effect of the Appeal Panel's analysis was to remove considerations of fault from an assessment of "undue hardship" in the context of s 154D(3)(b) of the Act, as shall be seen later in these reasons, that does not mean that fault may not be a relevant consideration in the discretionary decision to terminate a tenancy pursuant to s 91 of the Act. Cain v New South Wales Land and Housing Corporation (2014) 86 NSWLR 1; [2014] NSWCA 28 at [39] (Cain) is authority for that proposition, as well as for the more general proposition that an application for termination under s 91 of the Act involves the exercise of a discretion.
To return to the Appeal Panel's decision, whilst accepting that the Tribunal erred in the meaning it gave to "undue hardship" for the purposes of s 154D(3)(b) of the Act, the Appeal Panel found that the Tribunal had not erred in its exercise of discretion under s 91 of the Act on the alternative footing that undue hardship had been found to be established. The Appeal Panel noted that the discretion to terminate under s 91 of the Act, once engaged, is at large and that the s 154E matters, although mandatory, are not exhaustive.
The Appeal Panel found that the Tribunal had properly considered the s 154E matters and had indicated, by its reasons, that it appreciated that its general discretion under s 91 of the Act was not limited to considering the factors set out in s 154E(1) of the Act. The Appeal Panel further found that the Tribunal had in fact considered factors not mentioned in s 154E of the Act. The Appeal Panel rejected the complaint made by the respondent that the Tribunal failed to consider specifically each matter in s 154E of the Act, noting that the Tribunal was only required to consider those matters which had "weight, significance or relevance" citing Yonan v NSW Land and Housing Corporation [2017] NSWCATAP 37 at [48]. The Appeal Panel found no error in the House v The King (1936) 55 CLR 499; [1936] HCA 40 sense in relation to the Tribunal's exercise of discretion.
The Appeal Panel rejected the respondent's third ground of appeal in a manner that assumed no significance for the subsequent Supreme Court proceedings and so that may be passed over.
Relevantly for present purposes, however, in relation to the fourth ground of appeal, the Appeal Panel also determined that the Tribunal's reasons were not inadequate. It was held that the Tribunal's findings as to the basis on which it found that the respondent would not suffer undue hardship, and by reference to which it exercised its discretion in any event, were made clear by and in the Tribunal's reasons. In the result, the Appeal Panel dismissed the respondent's appeal to it.
Her Honour then made reference to the decision in Wade v Burns (1966) 115 CLR 537; [1966] HCA 35 (Wade). In that case, a mining warden who considered that he was required to refuse an application remarked that even had he had the power to grant the application he would have refused it. The warden was found to be in error in considering that he was required to refuse the application. The question was as to the effect of his articulation of how he would have exercised his discretion (had he had it). It was found that his statement as to what he would have done if he considered that he had the requisite power carried no weight because the warden considered that he did not have the power (see at 555 per Barwick CJ; 563 per Menzies J (with whom Taylor J agreed); 568 per Owen J).
Her Honour noted (at [52]) that the present case could be distinguished from Wade on the basis that:
"…in the present case the existence of the discretion was dependent on a factual finding (that the Tribunal was not satisfied of undue hardship), whereas in Wade v Burns, the mining warden's power arose as a matter of law. The similarity is that, in both cases, the decision-makers (the Tribunal in the present case or the mining warden in Wade v Burns) concluded incorrectly that they did not have a discretion or power but made alternative findings on the basis that they had the requisite discretion or power and said that they would not have exercised the power in favour of the individual."
Her Honour then cited the decision of Canham v Australian Guarantee Corporation Ltd (1993) 31 NSWLR 246 (Canham), in which Wade was considered, for the principle that "stated intentions to deal with a matter on a given basis which is not accepted by the decision-maker sometimes need to be disregarded as purely theoretical and not a proper exercise of the decision-maker's jurisdiction". Her Honour explained that it was important to address whether, if the premise for the principal finding were set aside (on her Honour's analysis, that s 154D(1) of the Act was engaged because the respondent was not likely to suffer undue hardship), the alternative finding (as to the exercise of the s 91 discretion) should stand.
Interpolating here, an important difference between the decision in Wade and the circumstances described in Canham, on the one hand, and the present case, on the other, is that in the present case the Tribunal did not merely conjecture as to how it would have decided the matter had s 154D(1) of the Act not been engaged. Rather, the Tribunal made its decision pursuant to s 91 of the Act, assuming in the respondent's favour that s 154D(1) of the Act was not engaged. That the Tribunal did not decide the matter on the basis of s 154D(1) of the Act is borne out by the terms of its order: "The Residential Tenancy Agreement is terminated in accordance with section 91 of the Residential Tenancies Act 2010" (emphasis added).
Adamson J noted that the powers conferred on the Appeal Panel by ss 80 and 81 of the CAT Act were wide, and permitted the Panel to identify the error made by the Tribunal (namely, its test of what constituted "undue hardship"), to assess the effect of the error (that is, whether there was in this case undue hardship) and to consider the balance of the Tribunal's decision in light of a different assumption (supposing there was undue hardship). Her Honour also observed that it was open to the Appeal Panel to substitute its own decision for that of the Tribunal, to remit the matter to the Tribunal for redetermination or to confirm, affirm or vary the decision of the Tribunal.
In light of the fact that the Appeal Panel's finding that the Tribunal was in error in determining what constituted undue hardship was not subject to challenge before her Honour, Adamson J stated that "[i]n th[ose] circumstances, it [was] questionable whether the Tribunal could have exercised its discretion under s 91 of the Act on the alternative basis unaffected by this error" (at [60]). As, according to her Honour, the Tribunal had not articulated what (if any) hardship it had taken into account, it was not possible to conclude that it had taken that factor into account, nor that the discretion which it purported to exercise in the alternative was not infected by the error that had led it erroneously to determine that this was not a case of undue hardship (at [61]). On that basis, her Honour held that the Appeal Panel erred in failing to find that the Tribunal's discretion miscarried in the House v The King (1936) 55 CLR 499; [1936] HCA 40 sense.
As to the respondent's second ground of appeal, her Honour stated that she was not persuaded that the Tribunal did draw the inferences of which the respondent complained. Her Honour held that the Appeal Panel was entitled to read the Tribunal's reasons as it did in that respect. That issue has no continuing significance.
In relation to the respondent's third ground of appeal, her Honour determined that the Tribunal's reasons were insufficient to indicate that hardship to the respondent had been taken into account in the exercise of the s 91 discretion, or whether the error that infected its determination under s 154D of the Act carried in the exercise of the discretion (at [67]). Her Honour determined that the failure to indicate in its reasons whether and, if so, how the mandatory consideration of hardship was taken into account by the Tribunal in exercising the discretion amounted to a material error. As a result, the primary judge found that the Appeal Panel erred in finding the Tribunal's reasons were not inadequate.
The gist of her Honour's criticism of the Appeal Panel's decision is contained in the final three sentences of [67] of the judgment which were that the Tribunal's reasons were:
"insufficient to indicate that hardship to the tenant was taken into account on the alternative basis in the exercise of the discretion under s 91. Given that the potential hardship to the tenant was, as was common ground, a mandatory relevant consideration in the decision whether to terminate the tenancy, the Tribunal was obliged, when setting out the pathway of its reasoning, to indicate that it was taken into account and how it was taken into account. It failed to do so." (emphasis in original).
In short, her Honour held that there was a failure to address hardship in [9] of the Tribunal's reasons and that this was a material error which had not been corrected by the Appeal Panel, her Honour concluding at [68] that:
"The Tribunal's reasons did not comply with s 62(3) of the [CAT] Act in that it failed to set out the reasoning process that led it to its conclusion. The Appeal Panel was in error in finding that the Tribunal's reasons were adequate."
It is convenient at this point to note the terms of s 62 of the CAT Act which are as follows:
"(1) The Tribunal (including when constituted as an Appeal Panel) is to ensure that each party to proceedings is given notice of any decision that it makes in the proceedings.
(2) Any party may, within 28 days of being given notice of a decision of the Tribunal, request the Tribunal to provide a written statement of reasons for its decision if a written statement of reasons has not already been provided to the party. The statement must be provided within 28 days after the request is made.
(3) A written statement of reasons for the purposes of this section must set out the following:
(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,
(c) the reasoning processes that lead the Tribunal to the conclusions it made.
(4) Nothing in this section prevents the Tribunal from giving oral reasons or a written statement of reasons for a decision it makes even if it has not been requested to do so by a party."
In the present case, the record did not make it clear whether or not the Tribunal's reasons were produced as a result of a request for reasons pursuant to s 62(2) of the CAT Act or whether the "decision" of the Tribunal was in fact contained in and communicated by the reasons delivered by the Tribunal on 16 January 2018.
Section 62(2) of the CAT Act might be thought to imply, on its proper construction, that, absent a request for reasons, reasons are not required for a decision of the Tribunal but this point, as Ward JA has pointed out in her concurring judgment, was not explored in argument.
Section 62(3) of the CAT Act only applies, in terms, to "a written statement of reasons for the purposes of this section." Arguably, that confines its operation to reasons supplied pursuant to a request by a party for reasons after having been notified of a decision by the Tribunal. It is not unreasonable, however, to suppose that s 62(3) supplies important guidance as to what should be set out by the Tribunal in reasons which it chooses to give even without a request for reasons pursuant to s 62(2). The balance of these reasons proceeds on that basis.
Against this, the respondent submitted that the Tribunal did not make any reference to hardship in its exercise of the discretion under s 91 of the Act. She contended that the Tribunal's reference to "all the circumstances" does not reveal that regard was properly had to the mandatory consideration in the context of s 91 of the Act. As such, the respondent contended that Adamson J was right to conclude that the reasons given by the Tribunal were inadequate in this respect. The respondent also relied upon the decision in Pollard at [56] and submitted that the Tribunal's reasons fell short of the requirement that "an appellate court should not be left to speculate from collateral observations as to the basis of a particular finding".
Before turning to consider these submissions, it is necessary to set out the principles relevant to the requirement for reasons of the Tribunal when exercising a discretionary power of the kind contained in s 91 of the Act.
An important question which is raised by the present case concerns the detail of reasons required of NCAT for a discretionary decision, particularly bearing in mind that there is no right of appeal from the Tribunal's decision other than on a question of law (although a broader appeal may be permitted with leave of the Appeal Panel): see [30] above.
As to the latter parameter identified by Basten JA in Resource Pacific, namely 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 with corresponding compensation for linguistic infelicities is appropriate than may be the case when an appellate court is hearing an appeal from another court.
That having been said, even in the less formal setting of a tribunal which has significant powers the exercise of which is capable of affecting the lives of citizens in profound ways, there are certain minimum characteristics that a Tribunal's reasons must possess. These are really supplied, in relation to the Tribunal, by s 62(3) of the CAT Act which, as noted at [52] above, 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.
Whilst s 62(3) provides a useful starting point, it still leaves for consideration the question as to the quality and detail of the reasoning process that must be exposed.
In this context, in Cypressvale Pty Ltd v Retail Shop Leases Tribunal [1996] 2 Qd R 462 at 477; [1995] QCA 187, Fitzgerald P said of the Queensland Retail Shop Leases Tribunal, adapting the language of Samuels JA in the unreported decision of this Court in Strbak v Newton (Court of Appeal (NSW), Samuels JA, 18 July 1989, unrep) (Strbak), cited in Xuereb v Viola (1988) 18 NSWLR 453 at 469, that, while such a tribunal:
"might not be required to 'submit the material before [it] to the most meticulous analysis and carry into [the reasons for its decisions] a detailed exposition of every aspect of the evidence and the arguments ...' or '... incorporate an extended intellectual dissertation upon the chain of reasoning ...', at least 'a basic explanation of the fundamental reasons which led the [Tribunal] to [its] conclusion ...' is necessary".
It should be noted that Samuels JA in Strbak had been describing the duty of a District Court judge to give reasons as opposed to that of a tribunal member.
In Tatmar at 386, Mahoney JA (as he then was) observed in the context of the obligation to give reasons for a discretionary judgment that it was not necessary for a judge:
"who is exercising a discretionary judgment to detail each factor which he has found to be relevant or irrelevant, or to itemi[s]e, for example, in the assessment of damages for tort, each of the factual matters to which he has had regard: see O'Hara v Evans (Court of Appeal, 23rd September, 1976, unreported; Colacicco v Colacicco (Court of Appeal, 15th March, 1977, unreported). ... 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: see Selvanayagam v University of the West Indies [1983] 1 WLR 585, at 587, 588; [1983] 1 All ER 824 at 826.
But, subject to matters such as these, the basis of the decision of a trial judge or of an intermediate court of appeal should be made apparent. This does not mean that the reasons given need to elaborate: an elaborate argument may not require an elaborate answer. Reasons need be given only so far as is necessary to indicate to the parties why the decision was made and to allow them to exercise such rights as may be available to them in respect of it."
To like effect, in Public Service Association and Professional Officers' Association Amalgamated Union of New South Wales v Secretary of the Treasury [2014] NSWCA 112 at [46], Basten JA said:
"Generally, the concept of 'reasons' requires an explanation connecting any findings of fact with the ultimate decision. Where the legal test to be applied involves an evaluative judgment, it may well not be practicable to provide a detailed articulation as to how specified (and conflicting) factors have been weighed in the balance; the scope of the obligation must recognise that constraint. (A different question arises if mandatory considerations have not been identified.)" (emphasis added)
What constitutes adequate reasoning on the part of a tribunal is also informed, in my opinion, by statements from well-known administrative law decisions relating to the limits of judicial review and the need for practical as well as principled restraint in that context: Pozzolanic at 287.
These principles include the following:
1. "Decision-makers commonly express their reasons sequentially; but that does not mean that they decide each factual issue in isolation from the others. Ordinarily they review the whole of the evidence, and consider all issues of fact, before they write anything. Expression of conclusions in a certain sequence does not indicate a failure to consider the evidence as a whole": Re Minister for Immigration and Multicultural Affairs, Re; Ex parte Applicant S20/2002; Appellant S106/2002 v Minister for Immigration and Multicultural Affairs [2003] HCA 30; 77 ALJR 1165 per Gleeson CJ at [14] (Ex parte Applicant);
2. the court should not read passages from the reasons for decision in isolation from others to which they may be related: Re Maria Politis v Commissioner of Taxation [1988] FCA 739 at [14]; 20 ATR 108 at 111;
3. the reasons must be read fairly and as a whole: Ex parte Applicant at [147] per Kirby J; Wu Shan Liang at 291; Bisley at 251;
4. the reasons recorded ought not to be inspected with a fine tooth-comb attuned to identifying error: Collector of Customs v Pozzolanic Enterprises Pty Ltd (1993) 43 FCR 280 at 287; [1993] FCA 456 (Pozzolanic) at 287; Wu Shan Liang at 272, 291;
5. 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: Pozzolanic at 287, Wu Shu Liang at 272 and 291.
Whilst it is correct that these last two findings were made in that section of the Tribunal's decision which considered whether or not "undue hardship" was made out, the important point to be made at this stage of the analysis is that the Tribunal found that the respondent may suffer hardship were the Agreement to be terminated. That this was so is also illustrated by the Tribunal's statement at the conclusion of [8] that the case was "finally [sic; scil. finely] balanced". The two matters in the balance were the hardship that would be suffered by the respondent if the Agreement were terminated, on the one hand, and what the Tribunal member considered to be the degree of the respondent's fault, on the other hand.
As has already been noted, the Tribunal concluded on balance that there would not be "undue hardship" within the meaning of s 154D(3)(b) of the Act but this conclusion was predicated on what the Appeal Panel held to be the Tribunal's erroneous understanding of the meaning of that phrase and, in particular, the mistaken view that fault formed part of the assessment as to whether or not "undue hardship" was established. In other words, the Appeal Panel had held that fault was not a relevant consideration at the "undue hardship" stage of the analysis.
Significantly, however, as has been noted at [33] above, fault is a relevant, if not mandatory, consideration in the exercise of the s 91 discretion: see Cain at [39] where it was said, in the context of s 91 of the Act, that "there [was] no basis for reading the statute as excluding either the personal history of the respondent, the nature of the offending, the sentencing in the District Court for the offence, the possibility of repetition in the future or the likely effect of the termination order on the tenant's health and medical treatment".
It follows that both fault and hardship were relevant considerations in the exercise of the s 91 discretion. Both had as a matter of fact been considered in the Tribunal's analysis of the undue hardship question in [8] of its reasons. It is for this reason that I respectfully disagree with Adamson J's statement at [60] of her reasons that it was "questionable whether the Tribunal could have exercised its discretion under s 91 [of the Act] on the alternative basis unaffected by [the] error" in relation to the meaning of "undue hardship".
When one turns to [9] of the Tribunal's reasons, which involved the exercise of the s 91 discretion on the assumption that undue hardship was in fact made out, it is apparent, in my opinion, that the Tribunal did take hardship into account. That this is so may be seen as a result of the following four textual references in [9]:
1. "… the Tribunal will go on to consider assuming undue hardship whether in all the circumstances including taking into account the matters set out in s 154E [of the Act] a termination order should be made" (emphasis added);
2. "In this case despite the reports in support of the tenant the Tribunal cannot find as it did on the last occasion that …" (emphasis added);
3. "Having regarded [sic] to the whole of the circumstance the Tribunal is of the view that the tenancy should be terminated" (emphasis added);
4. "… given the length of time the tenant has resided at the premises and the material in the reports submitted on behalf of the tenant, the Tribunal will allow a period of 3 months for the tenant to find alternate accommodation …" (emphasis added).
As to (i), the reference to "including" the mandatory considerations set out in s 154E of the Act made it plain that the Tribunal was taking additional matters other than those into account. This introduces textually the possibility that hardship was taken into account. That it undoubtedly was, in my opinion, was made plain by the reference to "in all the circumstances". In the context of this particular decision and what had been before the Tribunal, the circumstances necessarily included the position of the respondent and the hardship that it was claimed would be occasioned to her in the event that the tenancy were terminated. This had been the principal focus of [4], [7] and [8] of the Tribunal's reasons which had immediately preceded the reference in [9] to "in all the circumstances". Those circumstances must have, in my opinion, included the very matters that were the subject of the two findings of likely hardship in [8] and which I have extracted at [83] above.
As to (ii), the reference to the "the reports in support of the tenant" was a reference to the reports that had been extensively referred to in [7] of the Tribunal's reasons: see [20] above. The whole thrust of this suite of reports related to the hardship and adverse consequences that it was said that the respondent would or may sustain if the tenancy were terminated. The word "despite" necessarily implies that the contents of the reports were taken into account. As I point out below, it also indicates, perhaps somewhat elliptically, how they were taken into account.
As to (iii), the analysis is the same as in [89] above: the reference to the "whole of the circumstance[s]" must have included the undisputed fact that the respondent suffered post-traumatic stress disorder and that the termination may have serious adverse effects on the respondent's health.
As to (iv), the reference to the reports and the two-month extension prior to the termination taking effect constituted an acknowledgement by the Tribunal as to the hardship that termination would or may create for the respondent, and the extension of time was a recognition of, and partial attempt to accommodate, that hardship. It is highly unlikely, in my opinion, that that matter only formed part of the Tribunal's reasoning process after it had decided to terminate the Agreement.
My conclusion that hardship was taken into account is squarely rooted in the text of the Tribunal's decision. It is not dependent upon "speculat[ion]" "from collateral observations": cf Pollard and see [63] above.
As to Adamson J's statement that the Tribunal did not explain how it took hardship into account (see [50] above), again it seems to me, with respect and having regard to the principles stated in [73]−[77] above, that the manner in which hardship was taken into account was sufficiently, if on one view somewhat tersely, explained. The following matters in my opinion emerge from the Tribunal's decision, read as a whole:
1. hardship was one of many factors which fell for consideration: see [9] of the reasons, extracted at [25] above;
2. aspects of the respondent's case on hardship were not supported by evidence: see [4] of the reasons, extracted at [19] above;
3. to the extent (which is not wholly apparent) that the respondent gave evidence of hardship in her testimony before the Tribunal, the Tribunal found such evidence evasive: see [4] of the reasons, extracted at [19] above; and
4. the evidence of hardship was outweighed by other discretionary considerations, in particular, the Tribunal's consideration of the issue of fault and likelihood of further misconduct of the kind that led to the notice of termination.
This last point, on a fair reading of the Tribunal's reasons, is what is conveyed by its use of the word "despite" in the sentence extracted at [88(ii)] above, connoting as it does that the body of evidence set out in the various expert reports which had been tendered and which were referred to in [7] of the reasons and which went, inter alia, to the hardship that the respondent would or might sustain, whilst of some force, was not of sufficient force to overcome the considerations which pointed to an exercise of discretion to terminate the Agreement.
The above analysis as to how hardship was taken into account, namely as one of a number of relevant factors which was outweighed by competing considerations, is also reinforced by the Tribunal's use of the phrase "having regarded [sic] to the whole of the circumstance[s]" in the penultimate sentence of [9] of the Tribunal's reasons: see [25] above.
Further, her Honour's statement at [61] of her reasons, namely that because the Tribunal did not articulate, in her Honour's view, what if any hardship to the tenant it took into account, it was not possible to conclude that it took hardship into account and "if so, that its discretion was not infected by the error which had led to its erroneous finding under s 154D", appears to proceed on the basis that fault would not be a relevant matter that could permissibly be taken into account in the exercise of the discretion arising in circumstances where there is a finding of undue hardship (and hence that to take that factor into consideration would have "infected" the exercise of discretion).
It was (correctly) accepted by the respondent that fault is a matter that could permissibly be taken into account in the exercise of the relevant discretion (even though not properly part of the test when considering whether termination would be likely to cause "undue hardship"). Insofar as her Honour appears to have tested the adequacy of the reasons by reference to whether the reasoning disclosed whether the discretion had been infected by the error that had led the Tribunal erroneously to determine that this was not a case of undue hardship, this, with respect, misstates what is required to satisfy the requirement as to adequacy of reasons.
The reasons of the Tribunal in the instant case cannot be said to be inadequate for failing to disclose reasoning that would have persuaded the primary judge that the discretion was not infected by the error that it was accepted had been made as to the test of "undue hardship". It is, in my opinion, sufficiently clear from the Tribunal's reasons that both hardship to the tenant and fault were taken into account in the exercise of the Tribunal's discretion, and that how this was done was also adequately conveyed by the Tribunal's reasons. As was said in Tatmar, cited in [29] above, whilst a "court must not nullify rights of appeal by giving no or nominal reasons, … there is no duty to expound reasons so as to facilitate appeals".
Since preparing these reasons, I have had the benefit of reviewing the dissenting reasons of McCallum JA in this case.
In relation to the passage from the primary judge's judgment set out in McCallum JA's judgment at [122], I have already expressed my opinion that the Tribunal did adequately indicate that potential hardship was taken into account and how it was taken into account.
McCallum JA then goes on, at [124], to say that there is "ample authority" as to the content of the requirement to have regard to a mandatory relevant consideration. The "ample authority" her Honour refers to includes this Court's decisions in Weal v Bathurst City Council [2000] NSWCA 88; (2000) 111 LGERA 181 (Weal), Zhang v Canterbury City Council (2001) 51 NSWLR 589; [2001] NSWCA 167 (Zhang); and Azriel v NSW Land & Housing Corporation [2006] NSWCA 372 (Azriel). Those decisions do not deal with adequacy of reasons but, rather, with administrative decision making and the uncontroversial and long established proposition that an administrative decision maker must, when required to take a matter into account, give proper, genuine and realistic consideration to that matter.
In Weal, the issue to which the observations of both Giles JA and Mason P which McCallum JA has quoted in her decision were directed was the Council's failure adequately to consider the issue of noise impact in reaching a decision whether or not to grant development consent for the use of certain land as a rail freight terminal. The case involved an analysis of various reports which were before the Council, one of which recommended the leaving of the issue of noise impact to the Environment Protection Authority's approval. As Giles JA recorded at [90], the Council accepted this invitation and, as his Honour said at [91], "it should be inferred that the Council did not come to a view as to the noise impact of the development or means that might be employed to mitigate the noise of impact". I do not therefore see that this Court's decision in Weal says anything as to content of reasons required to be given by the Tribunal in a case such as that presently before the Court.
As to Zhang, this was an appeal from a decision of Talbot J in the Land and Environment Court, in turn allowing an appeal from a decision of a Commissioner of that Court in relation to a decision by Canterbury City Council to grant a development application for the use of certain premises in Campsie as a brothel. The essence of the decision is reflected in [76] of the Chief Justice's reasons, namely that the Commissioner did not "take into consideration" the standard contained in cl 4 of DCP 23 but, rather, substituted for the statutory requirement a different approach. The Chief Justice's statement at [64] relied upon by McCallum JA to the effect that mere advertence to a matter required to be taken into consideration is not sufficient was, as in Weal, a reference to administrative decision making and not to the content of reasons for decision. This is made plain, in my opinion, by the Chief Justice's citation of Parramatta City Council v Hale (1982) 47 LGERA 319 at 339. That case, as with Weal and Zhang, was not concerned with the content of reasons but the actions of a Council in considering development proposals.
The decision in Azriel, insofar as it cites Weal, does not, in my opinion, advance matters, and the passages cited were cited, unsurprisingly, in the context of Basten JA's observations about judicial review and what a decision maker must do, on the one hand, and not about the obligation upon a Tribunal to give reasons, and the law relating to the content of such reasons, on the other hand.
In any event, for the reasons I have given in [83]-[96] above, I do not consider that the Tribunal's decision amounted to "mere [and inadequate] advertence" to the subject of hardship, especially in a context where the Tribunal was engaged in an exercise of discretion. As I have sought to demonstrate, rather more than the "incantation" of the phrase "all of the circumstances" was involved in the Tribunal's decision, as a review of its reasons, in my opinion, satisfactorily discloses.
In Public Service Board of New South Wales v Osmond (1985-1986) 159 CLR 656 at 662; [1986] HCA 7, Gibbs CJ observed that there is no general rule of the common law, principle or natural justice that requires reasons to be given for administrative decisions (see also the observations of this Court in Absolon v NSW TAFE [1999] NSWCA 311 at [66] in the context of administrative tribunals which, by the statutes creating them, are required to give reasons for their decisions). See also the statement of the High Court in Wingfoot Australia Partners Pty Ltd v Kocak (2013) 252 CLR 480; [2013] HCA 43 (Wingfoot) at [43] that "there is in Australia no free-standing common law duty to give reasons for making a statutory decision". (Wingfoot involved a decision of a Medical Panel established under the relevant Act, where there was an express statutory duty to give reasons.)
In the present case, the source of any obligation on the part of the Tribunal, including on the part of the Appeal Panel, to provide written reasons in this matter was not examined. This is not unimportant. It should not be assumed that, in the absence of a request for the provision of reasons, there is an implied statutory obligation (let alone an obligation at common law) on the part of the Tribunal to do so. Nor should it be assumed that the content of reasons required to be provided under any such implied statutory obligation, or common law obligation, were such an obligation to be found, would mirror that required of a court. Writing extra-judicially in "The Evolution of the duty of decision-makers to give reasons" ((2016) 23 AJ Admin L 128), Sackville AJA has noted that the content of the judicial duty to give reasons varies depending on the jurisdiction being exercised by the court and the subject matter of the decision (see at 129, referring to the High Court's decision in Wainohu v New South Wales (2001) 243 CLR 181; [2011] HCA 24 at [56]). Sackville AJA there also pointed to the tension for decision-makers, judicial or otherwise, who are confronted with a high volume caseload and limited resources. At least anecdotally, that tension must be particularly apt for the Tribunal, which has a high volume of cases and is established under an Act the objects of which include "to enable the Tribunal to resolve the real issues in proceedings justly, quickly, cheaply and with as little formality as possible" (see s 3(d) of the NCAT Act).
McCALLUM JA: I agree that leave to appeal should be granted, for the reasons stated by Bell P. However, I respectfully disagree with his Honour's conclusion as to the determination of the appeal.
The Residential Tenancies Act treats social housing tenancy agreements as a discrete class of residential tenancy agreement. The provisions governing the Tribunal's authority to terminate such agreements (contained in division 5 of part 7 of the Act) serve the competing public interests of ensuring that the use of social housing is confined to lawful purposes and of providing secure accommodation for certain classes of vulnerable people. Thus in the case of social housing tenancies there is no discretion not to terminate the tenancy where the premises have been used for the cultivation of prohibited drugs, save in the case of undue hardship to a person falling within s 154D(3)(b), in which case the discretion not to make a termination order is enlivened.
The classes of person identified in s 154D(3)(b) are: "a child, a person in whose favour an apprehended violence order could be made or a person suffering from a disability within the meaning of the Anti-Discrimination Act 1977 who is occupying or jointly occupying the social housing premises". It may be noted that each of those classes of person enjoys specific protection under other State legislation. Protecting such persons against the potential harshness of a mandatory termination order on the ground of illegality, whilst also conferring a discretion to make a termination order on that ground, thus also serves the interest of achieving coherence in the law.
A landlord's application to have a social housing tenancy agreement terminated on the ground of illegal use of the premises must accordingly be considered in two stages. First, the Tribunal must determine whether the termination of the agreement is likely to result in undue hardship to a relevant person. As Bell P has explained, fault is irrelevant at that stage. Secondly, if undue hardship is established, the Tribunal is taken back to the provisions of part 5 which govern the exercise of the discretion to make a termination order in any case.
I agree with the President that, as held by the primary judge, the circumstances establishing "undue hardship" for the purpose of the first stage remain relevant at the second stage and that it is mandatory to give consideration to those matters at that second stage.
The primary judge held at [47], [61] and [67] that it was not possible to conclude that the Tribunal took hardship into account at that second stage because the reasons were inadequate to permit such a conclusion. I respectfully agree. Accordingly, I would dismiss the appeal. My reasons for reaching that conclusion substantially accord with those given by the primary judge but it is appropriate to state them in my own words.
As Bell P has noted at [9], the manner in which s 91 operates in cases governed by s 154D was common ground. The appeal was argued on the premise that s 91(1)(a) confers authority on the Tribunal to terminate a social housing tenancy agreement even where it is satisfied that the order would be likely to result in hardship that is "undue" (by some unstated measure). In that context, the recognition of hardship as a mandatory relevant consideration at the second stage may be regarded as uncontroversial, especially where that is the finding that enlivens the discretion not to make a termination order.
The primary judge said at [67] that, as the potential hardship was a mandatory relevant consideration in the decision whether to terminate the tenancy, "the Tribunal was obliged, when setting out the pathway of its reasoning, to indicate that it was taken into account and how it was taken into account" [emphasis in original].
In my respectful opinion, that was a correct approach. The grounds considered by the primary judge included a substantive ground (asserting legal error in the Appeal Panel's analysis of the Tribunal's approach to the discretion under s 91) and a "reasons" ground. As to the substantive ground (ground 1), the primary judge noted that the discretion under s 91 is at large (citing Cain at [12]-[26]) and upheld the Appeal Panel's conclusion that the Tribunal did not misapprehend the nature of the discretion. However, her Honour considered that the Appeal Panel was wrong to find that the Tribunal's reasons were adequate because, in her Honour's view, the reasons were insufficient to indicate that a mandatory consideration had been taken into account. It was in that context that the primary judge said: "the Tribunal was obliged, when setting out the pathway of its reasoning, to indicate that [the mandatory consideration] was taken into account and how it was taken into account".
There is ample authority as to the content of the requirement to have regard to a mandatory relevant consideration.
In R v Hunt; ex parte Sean Investments Pty Ltd (1979) 180 CLR 322 at 326, a decision concerned with a statutory mandatory consideration in the exercise of a discretionary power by a Minister, Mason J said at 329.2:
"When sub-s (7) directs the Permanent Head to "have regard to" the costs, it requires him to take those costs into account and to give weight to them as a fundamental element in making his determination."
In Weal v Bathurst City Council [2000] NSWCA 88; (2000) 111 LGERA 181, in a discussion of a consideration that was mandatory in the determination of a development application, Giles JA said at [80] (Priestley JA agreeing at [33]):
"Taking relevant matters into consideration called for more than simply adverting to them. There had to be an understanding of the matters and the significance of the decision to be made about them, and a process of evaluation, sufficient to warrant the description of the matters being taken into consideration" (citations omitted).
His Honour qualified that remark by noting at [81] that, in obedience to a provision of the Environmental Planning and Assessment Act 1979 (NSW) which, as here (in s 154E), provided a list of mandatory considerations, "the Council could not confine its consideration to the impact of the development on the environment, but had to take into consideration all other relevant matters. The Council had to balance possibly competing interests, in circumstances such as those in the present case including the public and private interests in preventing harm to the environment and the public and private interests in permitting gainful use of the land".
There is an analogy here. The Tribunal could not confine its consideration to the circumstances relied upon to establish hardship. But it had to have regard to those circumstances (on the assumption, contrary to its earlier finding, that they established excessive or disproportionate hardship) together with the factors listed in s 154E(1) to the extent that they were relevant in the present case.
In the same case, Mason P, with whose analysis of the relevant principles Priestley JA also agreed (while disagreeing as to the result), said at [9]:
"There is little point in searching for a definitive statement of what is involved in taking something into consideration. I am however, attracted to Gummow J's formulation of "proper, genuine and realistic consideration upon the merits".
His Honour noted that Gummow J's formulation was stated in the context of s 5(2)(f) of the Administrative Decisions (Judicial Review) Act 1977 (Cth) in Khan v Minister for Immigration and Ethnic Affairs [1987] FCA 713; (1987) 14 ALD 291 at 292) but that it had since received broader acceptance. I acknowledge that the jurisprudence that emerged from Khan has evolved since then.
In Zhang v Canterbury City Council (2001) 51 NSWLR 589; [2001] NSWCA 167, this Court said at [64] that mere advertence to a matter required to be taken into consideration is not sufficient: per Spigelman CJ, Meagher and Beazley JJA agreeing at [99] and [100].
In Azriel v NSW Land & Housing Corporation [2006] NSWCA 372, the two passages from Weal set out above were cited by Basten JA at [49] to support the proposition that "the requirement of consideration is not satisfied by formalistic reference". His Honour further noted at [50]:
"Just as a statutory mandate must be construed and applied bearing in mind its purpose - Interpretation Act 1987 (NSW), s 33 - so the decision-maker must address a legally mandatory consideration bearing in mind the purpose of the requirement."
In the present case, it may be inferred that the purpose of the requirement to consider the mandatory relevant considerations is to regulate the use and availability of social tenancy housing in a manner that fairly balances the competing (and often coincident) interests of prohibiting the use of such premises for unlawful purposes and protecting vulnerable persons in need of social housing.
That is by no means a comprehensive survey of authority on this point. While the statement of a definitive test remains elusive if not impossible, there can at least be discerned a minimum requirement, in the case of a mandatory relevant consideration, actually to consider the matter in question. I would understand that to be the case whether the decision-maker is exercising administrative power or, as here, judicial power (as held in Gatsby). If the reasons do not indicate how any mandatory consideration was taken into account, it may not be possible to conclude it was taken into account at all. That is what I understand the primary judge to have meant in the remarks set out above. I do not understand her Honour to have gone so far as to determine that the mandatory consideration was not taken into account but only that the reasons were inadequate to permit the conclusion that it was. Either way, legal error within the scope of the grounds of appeal before her Honour was established. Such overlap is not uncommon.
The task of taking the mandatory consideration of undue hardship into account at the second stage was complicated in the present case by the fact that the Tribunal appears to have rejected most of the hardship case at the first stage as unsubstantiated assertion. The Tribunal's reasons at [4]-[8] referred to a number of matters that had been "claimed", "asserted" or "suggested" by the reports in evidence. In considering those matters, the Tribunal rejected various aspects of the respondent's evidence (finding her to have been "evasive and unconvincing" in relation to one issue) and, in a way that was erroneous at that first stage, weighed those matters by reference to the Tribunal's assessment of the proportion of the respondent's fault. The burden of the reasoning was to reject the hardship case altogether.
While it was possible in theory to proceed to the second stage and exercise the discretion contingently against the risk of error in that first conclusion, it made no sense to do so without articulating and evaluating the matters accepted on that hypothesis. That had not been done at the first stage (of deciding whether undue hardship was established), at least to the extent that the factual basis for the hardship claim was rejected, which mostly it was.
As has been noted, the Tribunal's reasons in respect of the hypothetical exercise of the discretion set out at [9] of the decision followed the sequence of the list of mandatory considerations set out in s 154E of the Act. It appears from the terms of that paragraph that the Tribunal confined its attention in that second stage to the matters identified in ss 154E(1)(a), (d) and (e) respectively. Subject to one qualification, it also appears that the consideration of the "reports in support of the tenant" in that paragraph was confined to the matter raised by s 154E(1)(e), "whether the tenant, wilfully or otherwise, is or has been in breach of an order of the Tribunal". The relevant passage is as follows:
"The tenant has not been in breach of an order of the Tribunal but has been in breach of the law in a significant respect in cultivating cannabis at the premises whilst proceedings were on foot to have her evicted for that very thing. In this case despite the reports in support of the tenant the Tribunal cannot find as it did on the last occasion that there is only a small likelihood that the respondent will reoffend by way of again consuming cannabis at the premises. Having regard to the whole of the circumstances the Tribunal is of the view that the tenancy should be terminated."
On my reading of that passage of the reasons, taken in the context of the whole document, the "reports in support of the tenant" were referred to only in the context of the discussion of the respondent's unlawful conduct, which the Tribunal perceived as being relevant to the matter identified in s 154E(1)(e). There was no separate evaluation of the matters relied upon by way of hardship by reference to the interests of the respondent, let alone any weighing of those interests bearing in mind the statute's purpose of protecting vulnerable people such as the respondent.
The qualification is that, in the following sentence, the Tribunal referred to the reports again in the context of what might be termed the third stage of the task, namely, the determination to extend the usual period of notice, as follows:
"However given the length of time the tenant has resided at the premises and the material in the reports submitted on behalf of the tenant the Tribunal will allow a period of 3 months for the tenant to find alternative accommodation and orders will be made accordingly."
However, there was no analysis or engagement with the content of the reports at that stage. Further, in my view, the fact that the reports were referred to for that purpose but were not the subject of any analysis at the second stage tends to confirm that the Tribunal did not have regard to hardship as a relevant consideration at the second stage. Certainly, it is not possible to conclude that it did.
In my respectful opinion, the incantation of "all the circumstances" that had been referred to in the discussion of the first stage was insufficient to expose the Tribunal's reasons for determining the second stage adversely to the respondent. It was formulaic and did not engage with the merits of the mandatory consideration of hardship.
Finally, I respectfully disagree with the President's remarks at [97]-[99] concerning the primary judge's conclusion at [61] that, if the Tribunal did take hardship into account, it was not possible to conclude "that its discretion was not infected by the error which had led to the erroneous finding under s 154D". I do not think her Honour was proceeding on the incorrect premise that fault would not be a relevant matter in the exercise of the discretion under s 91. The point I understand her Honour to have been making is that, the Tribunal having concluded (by a wrong path) that any hardship was not "undue", in the absence of any exposition of its evaluation of that issue on the alternative premise, one could not be satisfied that the mandatory consideration was taken into account on the appropriate premise (that hardship was not only established but was excessive or disproportionate).
I have read in draft the separate judgment of Ward JA addressing the issue whether there was "any duty (statutory or otherwise)" to give reasons in circumstances where a statutory entitlement to request written reasons had evidently not been exercised; and, if not, whether that informed the adequacy of the reasons "that were given but that, on that hypothesis, there was no duty to give". As acknowledged by Ward JA, that issue was not explored before the Appeal Panel or in this Court and accordingly it is not appropriate to reach any concluded view. However, the issue having been raised by Ward JA, it is appropriate to observe that, as I read the decision in Collins v Urban at [48]-[56], the Appeal Panel accepted the existence of a common law obligation to give reasons but qualified the content of that obligation by reference to a series of propositions set out at in the judgment at [57].
In any event, for the reasons stated above, in my view the primary judge was plainly right and the appeal should be dismissed.