O'Brien v Twyman

NCAT Appeal Panel|2015-06-02

AP 14 Zahed v IGA Limited t/as NRMA Insurance [2016] NSWCA 55 Texts Cited: J W Carter and D J Harland in "Contract Law in Australia" (4th Edition Butterworths 2002) Category: Principal judgment Parties: Nicole O'Brien (appellant) Sue Twyman (respondent) Representation: Applicant in person Respondent in person File Number(s): AP 15/10551 Decision under appeal Court or tribunal: Civil and Administrative Tribunal Jurisdiction: Consumer and Commercial Division Date of Decision: 30 January 2015 Before: K Holwell, Tribunal Member File Number(s): RT 14/57076 RT 14/50030

Introduction

The appellant, Nicole O'Brien, is a former tenant of residential premises (the premises) owned by the respondent landlord, Sue Twyman. In June 2014, the respondent's agent served the appellant with a "no grounds" termination notice of the residential tenancy agreement in regard to the premises. The notice required the appellant to vacate the premises on 23 September 2014. The appellant vacated the premises on 24 September 2014.

The appellant's Notice of Appeal

As noted above, the orders of the Tribunal challenged by the appellant are those made in regard to the respondent's application before the Tribunal (i.e. file number RT 14/57076). In her oral submissions before the Appeal Panel the appellant did not press her appeal in regard to the Tribunal's findings concerning the outstanding rent (i.e. the $342.86). However, she did press her appeal in regard to the Tribunal's findings concerning the respondent's claim for repairs and damages.
In light of the orders sought by the appellant in her Notice of Appeal, it is apparent that she also seeks to challenge the order made by the Tribunal in regard to her application for the bond to be paid to her and we have dealt with it accordingly.
The appellant identified her grounds of appeal as follows: "1. I provided stronger evidence than the landlord but the member did not seem to want to consider my doc's, photos + statements. 2. There was no consideration for fair wear, age of house & fittings rules of mitigation, depreciated value. 3. There was no reasonable standard of proof that I had caused damage that was wilful or negligent - when damage was due to poor quality of things, the age of things and lack of repair of the landlord, despite my asking. 4.The member did not swear us to give evidence. 5. The decision was therefore unfair, inequitable and granted the landlord new for old and was against the weight of evidence allowing the landlord to be better off and me to be unfairly worse off."
The appellant elaborated on these further in her Notice of Appeal and she also addresses the reasons why her appeal was lodged out of time.

Reply to Appeal

In her Reply to Appeal the respondent said she agreed with the orders made by the Tribunal below. The respondent also noted the appellant's Notice of Appeal had been lodged out of time.

Material before the Appeal Panel

Attached to the appellant's Notice of Appeal were a number of documents she had relied on before the Tribunal below, together with some fresh evidence and written submissions. No grounds were advanced to support an application to consider fresh evidence, and accordingly we have disregarded the fresh evidence.
The material relied on by the appellant before the Tribunal below included the following:

a statutory declaration and statement made by the appellant and dated 13 November 2014;
written submissions dated 1 December 2014;
a statement by Michelle Spiliotis, a contract cleaner, dated 10 November 2014;
a copy of the residential tenancy agreement, dated 13 November 2014 and a copy of a Schedule 2 - Residential Tenancy Premises Condition Report relating to the premises and signed by the respondent's leasing agent and the appellant on the same day (13 November 2013) ;
a copy of photographs taken by the applicant on 10 October 2014;
a copy of photographs taken by the respondent's leasing agent with commentary by the appellant added to each photo;
a reference from Margaret Vaughan, a former landlord of the appellant;
a "Rental History Check" and "Tenant Ledger" sent, by facsimile on 9 September 2014, to the appellant from the respondent's leasing agent. In the "Rental History Check" the agent said the property had been kept "very clean & tidy" and there was no reason the bond "may not be refunded". As a tenant the agent rated the appellant at 9 on a scale of 1 to 10 and made the following handwritten comment at the bottom of the page: "Maintenance: Property has had a series of water leaks from the unit next door, bathroom & now roof leaks. She has been given rent free weeks & …"
On the "Tenant Ledger" the agent noted the appellant was paid "up to date & in advance." The Ledger also noted the appellant had been given 2 weeks rent free, in May 2014, while the bathroom was being repaired and was not being "required to pay outgoings while other water leaks have been reported."
a reference/statement from Tony O'Rourke, a ceramic tiler, dated 1 December 2014 concerning the leaking shower;
a reference/statement from Kirk Handley, a supplier of Laminex doors and kitchen bench tops, sent to the appellant, by email on 19 December 2014, concerning his visit to the premises. In his email Mr Handley said the 'pantry cupboards had no doors" and the 'bedroom cupboards were suffering from what appeared to be dry rot and hinges were coming away from doors."

The respondent also filed and served a number of documents and written submissions for the purpose of this appeal. Again to the extent the documents included fresh evidence we have disregarded this evidence. However, we note the documents included the following which were before the Tribunal below:

a summary of expenses, with relevant receipts and invoices attached;
a statement by the respondent dated 11 and 13 November 2014;
a handwritten note of the respondent to her leasing agent, dated 4 November 2014, with receipts and invoices attached;
an unsigned and undated statement from Mr Paul William Umstad, the respondent's handyman;
a unsigned and undated statement from Mark Holloway;
a bundle of photographs of doors and other items within the premises that are stated to have been taken on 25 September 2014;
a copy of the residential tenancy agreement between the parties, dated 16 October 2013;
a copy of the Schedule 2 - Residential Tenancy Premises Condition Report relating to the premises and signed by the respondent's leasing agent and the appellant on 13 November 2013 together with a copy of a number of photographs of the premises;
a copy of an email the respondent's agent sent to the appellant on 8 October 2014 setting out a list of items that needed to be fixed and cleaned, the rent that was outstanding and the amount of rental bond that was held. The email made reference to photographs being attached and advised that any items not attended the cost of such would be taken from the bond;

The Appeal Panel has also had access to the Tribunal's file in regard to the applications before it.

The hearing before the Tribunal below

The hearing before the Tribunal below took about an hour. At the commencement of the hearing, the Tribunal Member noted that there were two matters listed for hearing together. After referring to the file number of each matter, the parties and the nature of each matter, the Tribunal Member said he would start with the "landlord's case" (i.e. the respondent in these proceedings). The Member noted the hearing of the matters was being recorded and said that any evidence given had to be given by oath or affirmation. He then said "the battle ground seems to be these repairs" and proceeded with the first item on the respondent's summary of expenses. That summary was in the following terms: Item Company Cost Repair Phone connection Trigg Electrical $88.00 New Toilet Seat Bunning Receipt $15.90 Timber for damaged Doors Greenmount Timber $185.99 Hinges & Screws for the Bunning Receipt $30.26 Damaged Doors Paint for Laundry Ceiling Fairdinkum Handyman $50.00 Repairs to Premises Fairdinkum Handyman $1,778.21 Curtain Repairs Noys Nic Nax … $90.09 Additional Cleaning SOS Support Services $150.00 Rent Due To Vacate Due to 24/09/2014 $342.86
There was some discussion between the Tribunal Member and the parties in regard to the first item listed in the summary, the phone connection, which the applicant said she did not use. The Tribunal then proceeded to deal with each items on the respondent's list, including the claim for unpaid rent. The Tribunal asked questions in respect to each item on the summary, to which the respondent and the appellant responded.
At the conclusion of the hearing the Tribunal Member gave his decision and his oral reasons for decision. In his oral reasons for decision the Tribunal Member noted and said the following: 1. there was a tenancy between October 2013 and September 2014 - in June 2014, the tenant was given a no grounds notice of termination and she vacated the premises on 24 September 2014; 2. the condition report at the commencement of the tenancy was signed by the tenant. The Tribunal Member said the following in regard to the condition report: "Generally speaking the tenant has agreed in most situations that the landlord's description of the property regarding cleanliness, damage etc. and the operation of things is generally accepted by the tenant"; 1. the terms of the provisions in sections 51(1)(d), 51(2) and 51(3) of the Residential Tenancies Act were recited verbatim by the Tribunal Member; 2. the Tribunal Member went on to say: "The main part of this claim is the landlord's claim for damage and the Tribunal has to determine whether this is a genuine claim for damage by the landlord or a refurbishment of the unit claimed to be at the tenant's expense. The test is on the balance of probabilities - that is, is it more likely than not the Tribunal accepts the case of the landlord or the case of the tenant. There is a claim for damage to the kitchen phone connection and the main claim for damage is to the doors, which involved repair and replacement of some of the doors and then the painting and staining of the doors - there is a small claim for painting the laundry ceiling, curtain repairs - a claim for additional cleaning and a claim for rent to the vacate date. It is clear from the ledger that rent was paid to the 16th of September and it is clear that rent to 24 September is payable … I am not satisfied about the cleaning … but, on balance I find that this is not wear and tear in the property and not repairs to which the landlord had to perform I am satisfied that there was, maybe not intentional but certainly negligent damage to the premises during the tenancy and I am satisfied that the rest of it is payable by the tenant."

Extension of Time Application

Rule 25(4)(b) of the Civil and Administrative Tribunal Rules 2014 provides that unless the Tribunal grants an extension of time, an internal appeal against a decision made in residential proceedings is to be made within 14 days from the day on which the appellant was notified of the decision or given reasons for the decision (whichever is the later).
Section 41 of the Civil and Administrative Tribunal Act 2013 makes provision for the Tribunal to extend time. That section is in the following terms: "41 Extensions of time (1) The Tribunal may, of its own motion or on application by any person, extend the period of time for the doing of anything under any legislation in respect of which the Tribunal has jurisdiction despite anything to the contrary under that legislation. (2) Such an application may be made even though the relevant period of time has expired."
In her Notice of Appeal the appellant stated she was notified of the Tribunal's decision on 30 January 2015. Hence, she was required to lodge her Notice of Appeal on, or before 13 February 2015.
The appellant did not lodge her Notice of Appeal with Service NSW until 27 February 2012 and it did not reach the Tribunal's Tamworth Registry until 9 March. Hence her Notice of Appeal was lodged with the Tribunal 23 days late.
The appellant's explanation for the delay was that she had sought advice from "Fair Trading" as to how she could appeal the decision of the Tribunal. She said she was advised to make a "set aside vary application." Clause 9 of the Civil and Administrative Tribunal Regulation 2013 makes provision for such applications. The appellant's set aside application was lodged within time, on 6 February 2015: see Civil and Administrative Tribunal Regulations, clause 9(3).
The Tribunal, differently constituted, determined the appellant's set aside application, on 12 February 2015. The appellant and the respondent were notified of the Tribunal's determination in a letter dated that day.
The letter noted that the Tribunal had dismissed the appellant's set aside application because the decision made by the Tribunal on 30 January 2015 was not made in the absence of the appellant: see Civil and Administrative Tribunal Regulations, clause 9(b). This is one of the two grounds on which the Tribunal in the Consumer and Commercial Division is given power to set aside or vary a decision made by the Tribunal in that Division. The other ground is where the parties to proceedings consent to the making of the order to set aside or vary the decision; see clause 9(1)(a).
The letter went on to say: "Further Reasons: The applicant (for set aside) was present at the hearing on 30/1/15. If she is asserting that the Member's decision was against the weight of evidence or that she was denied procedural fairness, then her remedy lies elsewhere (i.e. by way of appeal to the Tribunal's Appeal Panel)."
It was as a result of this letter that the appellant lodged her Notice of Appeal. However, she did not lodge her appeal for some days (i.e. about 10-13 days later). The appellant explained that her delay was because she wanted to obtain further evidence about the condition of the premises. We understand this to be the fresh evidence she filed in this appeal. It is otherwise not clear why there was a further delay in the appellant's Notice of Appeal being forwarded by Service NSW to the Tamworth Registry of the Tribunal.
In Jackson v NSW Land and Housing Corporation [2014] NSWCATAP 22 at [18], the Appeal Panel said that while the discretion to grant an extension of time in section 41 of the Civil and Administrative Tribunal Act is unfettered, it must be exercised judicially having regard to the guiding principle set out in subs 36(1) of the Act.
At [21], the Appeal Panel said time limits should generally be strictly enforced and the express power in section 41 to grant an extension of time allows the Tribunal to prevent the rigid enforcement of time limits becoming an instrument of injustice. That is, "in order for the power to extend time to be exercised in an appellant's favour there must be material upon which the Appeal Panel can be satisfied that to refuse the application for an extension of time would work an injustice."
At [22], the Appeal Panel set out the considerations that will generally be relevant when considering an application for an extension of time. These included: 1. the length of the delay; 2. the reason for the delay 3. the appellant's prospect for success - does the appellant have an arguable case; and 4. the extent of any prejudice suffered by the respondent to the appeal.
As we have noted, the length of the delay was 23 days, which is a considerable delay given the 14 day time limit within which the lodge an appeal. However, we are satisfied that the appellant, who has at all times been unrepresented has given a satisfactory explanation for the delay in that she would have lodged her appeal earlier had she not been advised incorrectly to make a set aside application.
In regard to prejudice to the respondent if time is extended, at the hearing the respondent did not point to any prejudice and she did not otherwise object to time being extended.
For the reasons set out below we have also found that there is merit to the appellant's appeal. Hence, we have determined it is appropriate to extend time within which the appellant is to lodge her appeal to 9 March 2015.

Legal principles

The appellant is unrepresented and while she has expressly sought leave to appeal under cl 12 of Schedule 4 of the Civil and Administrative Tribunal Act, in our view, her grounds of appeal and submissions also raise questions of law. These are, a denial of procedural fairness, and a failure to provide proper reasons: see John Prendergast & Vanessa Prendergast v Western Murray Irrigation Ltd [2014] NSWCATAP 69 at [13(1) and (4)]. The former relates to the manner in which the Tribunal heard the matter and the latter relates to the adequacy of the Tribunal's oral reasons for decision.

Cl 12 of Schedule 4

In Collins v Urban [2014] NSWCATAP 17, at [68], the Appeal Panel noted that cl 12 does not require the Appeal Panel to find that the appellant in fact "suffered a substantial miscarriage of justice." It was only required to find that the appellant "may" have suffered such a miscarriage. However, the Appeal Panel went on to say that there must be a sound basis for granting leave to appeal, namely a "significant possibility" or a "chance which was fairly open" that a different and more favourable result would have been achieved for the appellant" had the relevant circumstances in cl 12(1)(a) or (b) not occurred or if the fresh evidence in para (c) had been available: see at [76].
In Collins (supra) at [77], the Appeal Panel gave an example of what might fall within cl 12(1)(a) and (b) of Sch 4 of the Civil and Administrative Tribunal Act. The Appeal Panel said: "if there has been a denial of procedural fairness the decision under appeal can be said to have been "not fair and equitable."
In her submissions the appellant expressly contended she was denied procedural fairness in the context of her first ground of appeal (the Tribunal ignored her evidence and not sworn to give evidence or cross-examination).

Denial of procedural fairness

As was noted in Williams v NSW Land and Housing Corporation [2012] NSWSC 1022 at [38] and Gallo v Duflou [2014] NSWCATAP 115 at [28] the starting point for considering the requirements of procedural fairness is the applicable statutory scheme. For the purpose of this appeal, the applicable statutory scheme is that contained in the Civil and Administrative Tribunal Act.
Subsection 38(2) of that Act provides the Tribunal "is not bound by the rules of evidence and may inquire into and inform itself on any matter in such manner as it thinks fit, subject to the rules of natural justice." The common law rules of natural justice are commonly referred to as the rules of procedural fairness (i.e. the hearing rule and the bias rule).
Many aspects of the hearing rule are found in s 38 of the Civil and Administrative Tribunal Act. That section relevantly provides as follows: 38 Procedure of Tribunal generally (1) The Tribunal may determine its own procedure in relation to any matter for which this Act or the procedural rules do not otherwise make provision. … (4) The Tribunal is to act with as little formality as the circumstances of the case permit and according to equity, good conscience and the substantial merits of the case without regard to technicalities or legal forms. (5) The Tribunal is to take such measures as are reasonably practicable: (a) to ensure that the parties to the proceedings before it understand the nature of the proceedings, and (b) if requested to do so - to explain to the parties any aspect of the procedure of the Tribunal, or any decision or ruling made by the Tribunal, that relates to the proceedings, and (c) to ensure that the parties have a reasonable opportunity to be heard or otherwise have their submissions considered in the proceedings. (6) The Tribunal: (a) is to ensure that all relevant material is disclosed to the Tribunal so as to enable it to determine all of the relevant facts in issue in any proceedings, and (b) may require evidence or argument to be presented orally or in writing, and (c) in the case of a hearing - may require the presentation of the respective cases of the parties before it to be limited to the periods of time that it determines are reasonably necessary for the fair and adequate presentation of the cases."
However, the hearing rule generally and as set out above and other procedural rules in the Civil and Administrative Tribunal Act and the Procedural Rules made pursuant to that Act, are subject to the guiding principle in subs 36(1) of the Act: see Gallo v Duflou [2014] NSWCATAP 115 at [28]ff and Amad El Ahmad t/as Cars for Everyone v Imelda Reyes [2015] NSWCATAP 50 at [16]ff. Subs 36(1) provides as follows: 36 Guiding principle to be applied to practice and procedure (1) The "guiding principle" for this Act and the procedural rules, in their application to proceedings in the Tribunal, is to facilitate the just, quick and cheap resolution of the real issues in the proceedings. (2) … "

Adequacy of reasons

Section 62 of the Civil and Administrative Tribunal Act provides the Tribunal is to give notice of a decision it makes and to provide written reasons on request. That section is in the following terms: "62 Tribunal to give notice of decision and provide written reasons on request (1) The Tribunal (including when constituted as an Appeal Pane) 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."
While subs 62(3) expressly applies to circumstances where a party is given written notice of a decision and that party makes a request for written reasons, it has been accepted that it equally applies to oral reasons for decision and written reasons for decision more generally: see Collins v Urban (supra), at [56].
However, as noted by the Appeal Panel in Commissioner of Police, NSW Police Force v Barrett [2015] NSWCATAP 68, at [97], it is well accepted that reasons for decision need not be highly detailed and they should not be examined with an overly critical eye. The Appeal Panel went on to cite the following remarks of Gleeson JA in Keith v Gal [2013] NSWCA 339, at [117]: "117 Thus, it is essential to expose the reasoning on a point critical to the contest between the parties. This proposition reflects one of the three fundamental elements to a statement of reasons identified by Meagher JA in Beale v GIO [Beale v Government Insurance Office of NSW (1997) 48 NSWLR 430] at 443-444: "Thirdly, a judge should provide reasons for making the relevant findings of fact (and conclusions) and reasons in applying the law to the facts found. Those reasons or the process of reasoning should be understandable and preferably logical as well.'"
In the recent decision of Zahed v IGA Limited t/as NRMA Insurance [2016] NSWCA 55, at [4], Lemming JA held the obligation imposed on an assessor under the Motor Compensation Act 1999 (NSW) as to what is to be contained in reasons for decision is less than that imposed on courts. The Motor Compensation Act contains provisions similar to those in subs 62(3) and at [6], His Honour said: "… [The] question is whether the reasoning process can be discerned, reading the reasons as a whole and applying a "beneficial construction" to which the High Court referred in Minister for Immigration and Ethnic Affairs v Wu Shan Liang (1996) 185 CLR 259 at 271-272. At least where a gap may be filled as a matter of necessary inference on a fair reading of the reasons, I would consider that the obligation to set out the reasons has been discharged."

Consideration

In summary, the appellant's contention is that she has suffered a substantial miscarriage of justice because: 1. the Tribunal Member did not consider and ignored the documentary evidence she had submitted within the time ordered. This included evidence of fair wear and tear and evidence of her requesting the respondent to undertake repairs well before the Termination Notice was issued, 2. she did not get sworn to give evidence and she was not given an opportunity to cross-examine the respondent on her evidence, 3. she did not get the respondent's evidence in regard to damages until shortly before the hearing and was not given an opportunity to respond to it; 4. the Tribunal Member did not consider "depreciated value despite the evidence from the landlord being that she owned the unit for about 30 years and had not renovated for at least 13 years"; 5. the Tribunal Member did not consider the "rules of mitigation" or the fact the respondent had not taken any steps to prepare an agreed record of the state of the premises prior to the applicant doing her final cleaning; and 6. the respondent did not submit any evidence that she had kicked the cupboard doors or had in fact caused the alleged damage.
The matters listed above are also encapsulated in the appellant's grounds of appeal. Before we deal with these matters, it is necessary to briefly set out the provisions of the Residential Tenancies Act relevant to the Tribunal's determination of the applications that were before it.

Residential Tenancies Act

The respondent's claim for repairs was based on the appellant having breached the residential tenancy agreement between them. The terms of the agreement included those contained in s 51 of the Residential Tenancies Act (see subs 51(4)) and are contained in cl 15, 16 and 17 of the tenancy agreement the parties signed. Section 51 relevantly provides: 51 Use of premises by tenant (1) A tenant must not do any of the following: (a) … … (d) intentionally or negligently cause or permit any damage to the residential premises, … (2) A tenant must do the following: (a) …, (b) notify the landlord of any damage to the residential premises as soon as practicable after becoming aware of the damage. (3) On giving vacant possession of the residential premises, the tenant must do the following: (a) … (b) leave the residential premises as nearly as possible in the same condition, fair wear and tear excepted, and, if there is a condition report, as set out in the condition report applicable to the premises when the agreement was entered into, (c) ..."
As can be seen s 51 contains a number of obligations that are imposed on a tenant in his/her use of the premises the subject of the residential tenancy agreement.
An alleged breach of the obligation in subs 51(1)(d) requires proof not only of the alleged damage, but also proof of the damage having been caused by, or permitted by intentional or negligent acts and omissions of the tenant.
In regard to the obligation in subs 51(3)(b), s 29 of the Residential Tenancies Act makes provision for a "condition report" relating to the condition of residential premises at the time a tenancy agreement is entered and also at a time the tenancy is terminated. That section is in the flowing terms: "29 Condition reports (1) A condition report relating to the condition of residential premises on a day specified in the report must be completed by or on behalf of a landlord before or when the residential tenancy agreement is given to the tenant for signing. (2) Two copies of the condition report must be given by the landlord or landlord's agent to the tenant before or when the tenant signs the residential tenancy agreement. (3) The tenant must complete and give one copy of the condition report to the landlord or landlord's agent not later than 7 days after receiving it and both the landlord and the tenant must retain a copy of the report. (4) At, or as soon as reasonably practicable after, the termination of a residential tenancy agreement, the landlord or landlord's agent and the tenant must complete the copy of the condition report retained by the landlord or the tenant under this section, in the presence of the other party. (5) It is not a breach of subsection (4) for the condition report to be completed in the absence of the other party if the party completing the report has given the other party a reasonable opportunity to be present when it is completed. (6) A condition report is to be in the form prescribed by the regulations and may be included in a prescribed standard form of residential tenancy agreement."
Section 30 provides, where a condition report is signed by both parties to the tenancy agreement, the report is presumed to be correct as to the state of repair of the premises as at the date the report, unless there is evidence to the contrary. That section is in the following terms: "30 Condition report evidence of condition of premises (1) A condition report that is signed by both the landlord and the tenant is presumed to be a correct statement, in the absence of evidence to the contrary, of the state of repair or general condition of the residential premises on the day specified in the report. (2) This section does not apply: (a) to any matter that could not have reasonably been discovered on a reasonable inspection of the premises, or (b) to any statement in the report about which the tenant makes a written dissenting comment on the copy of the report completed by the tenant and retained by the landlord."
In this case a pro-forma condition report was prepared and signed by both parties at the commencement of the tenancy. However, no condition report was prepared at the conclusion of the tenancy.

Ground (a) and (b) - The Tribunal ignored the appellant's evidence and the appellant did not give sworn evidence and was not given an opportunity to cross-examine the respondent

As we have noted above, in proceedings before it, the Tribunal is to ensure that the parties before it have a "reasonable'" opportunity to be heard: subs 38(4) and 38(5)(c) of the Civil and Administrative Tribunal Act.
It is accepted that a trial judge has a duty to ensure that all parties have a fair trial and in doing so the trial judge must "exercise his discretion in and about the examination and cross-examination of witnesses that a fair trial is assured" (see GPI Leisure Corp Ltd v Herdsman Investments Pty Ltd (No 3) (1990) 20 NSWLR 15, per Young J at 22).
The courts have also accepted that denial of the right to cross-examine during the course of a civil trial may on its own constitute a denial of procedural fairness because the right to cross-examine is an important one: see Wakim v Mathiew Pty Ltd t/as Dove Migration Services [2002] NSWSC 405 at [30] and Williams v NSW Land and Housing Corporation [2012] NSWSC 1022 at [45].
The Appeal Panel has said, subject to the "guiding principle" in subs 36(1) of the Civil and Administrative Tribunal Act, the abovementioned right to examine and cross-examine a witness equally applies to proceedings before the Tribunal: see Gallo v Duflou (supra) at [28]ff and Amad El Ahmad (supra) at [16]ff.
In this case, at the commencement of the hearing, the Tribunal Member made a general statement that evidence would be given on oath and on affirmation. While the Tribunal is to act with as little formality as the circumstances permit, we have some difficulty in understanding what the Tribunal Member meant or intended when making this statement, as at no time during the hearing was the appellant, the respondent, or the respondent's leasing agent sworn to give evidence. Nor was there any cross-examination.
The hearing then proceeded with the Tribunal dealing with the respondent's claim. In our view, this was an appropriate course to adopt, as the appellant's claim was essentially a defence to that claim. In the course of dealing with the respondent's claim, the Tribunal asked question of the respondent and her leasing agent and also of the appellant in regard to each item on the respondent's summary list of damage claimed. The appellant responded to the questions asked of her and she also commented on what the respondent and her leasing agent had said. It was during these responses and comments that the appellant made reference to the "evidence" she had provided. We note the Tribunal also specifically referred to some of the material the appellant had filed (e.g. the statement made by the appellant's cleaner and the "Rental History Check" the respondent's leasing agent had sent to her on 9 September 2014).
Prior to giving his decision, the Tribunal Member also asked the appellant if there was anything further she wanted to say. She said there was nothing further that she wanted to say.
In our view, having listened to the sound recording of the hearing below, it cannot be said the appellant was denied the opportunity to be heard and to present her case/defence.
While the parties responses to questions asked of them included evidence in addition to that contained in their respective statements and documents provided prior to the hearing, in our view, there was no need for the Tribunal to have individually sworn them to give this evidence. As noted above, the Tribunal is not bound by the rules of evidence and can inquire itself on any matter in such manner as it thinks fit, subject to the rules of procedural fairness. Ultimately, it was a question as to what weight should be given to the additional evidence that was given during the course of the hearing - especially where that evidence should have been included in the material that had been provided prior to the hearing and that evidence could not be tested by the other party.
This does not mean the appellant had no right to cross-examine the respondent and her leasing agent in regard to their oral evidence and written evidence provided prior to the hearing. However, at no stage during the hearing did she request to do so. Nor has the appellant submitted in these proceedings that she was unaware of her right to cross-examine them and had she been aware of this right she would have sought to do so.
Accordingly, we are not satisfied that the appellant has established this ground of appeal.
In regard to the appellant's contention that the Tribunal ignored her evidence we have dealt with this further, under the heading (f) below, in the context of the adequacy of the Tribunal's reasons for decision.

Ground (c) - The appellant did not get the respondent's evidence in regard to the damages until shortly before the hearing and was not given an opportunity to respond

The appellant submitted a copy of 11 pages she contended the respondent had relied on at the hearing and which were only provided to her five minutes before "the first hearing in Tweed Heads." The first page was a copy of the respondent's summary of expenses and the remaining pages were copies of invoices and receipts relating to those expenses. The invoices and receipts were those from Trigg Electrical, Greenmount, Fairdinkum Handyman Services and Bunnings Warehouse
We have assumed these pages were provided to the appellant just prior to the 30 January 2015 hearing.
The appellant contends she was not given an opportunity to respond to these. At the beginning of the hearing, the appellant made a reference to having only been provided with a copy of these pages shortly before the hearing, but did not object to them being relied upon.
While the appellant may not have received these exact pages, the Tribunal's files indicate she had been provided with this information. For example, on 2 December 2014, the appellant sent to the Tribunal her handwritten submissions/evidence in response to the evidence the respondent had provided at that time. In her submissions/evidence the appellant made specific reference to a number of items on the respondent's summary of expenses and the abovementioned invoices and receipts. The appellant had also been informed about the items for which a claim would be made in an email sent by the respondent's leasing agent on 8 October 2014.
The appellant's handwritten submission/evidence was provided three days after the respondent had filed her application with the Tribunal. In her application the respondent sought an amount of $2,388.45 for repairs. The same amount is contained in the respondent's summary of expenses for repairs.
Accordingly, we find the appellant has not established this ground of appeal as she had been provided with the material relevant to the respondent's claim for damages well before this.

Ground (d) and (e) - the Tribunal did not consider "depreciated value" or the "rules of mitigation"

We do not understand how the concept of "depreciated value" was of any relevance to the respondent's claim for damages.
As noted by the Court of Appeal in Marcourt v Clark [2012] NSWCA 367 at [98] and [99], an award for damages for a proven breach of contract is compensatory and designed to put the injured party, as far as money can do it, into the position he/she would have been had the contract been performed. That is, the injured party is not entitled to recover the costs of repairs that would place the party into a better position than they were in if there had been no breach (i.e. the injured party is not entitled to recover the costs of any betterment).
As pointed out by the Court of Appeal in Marcourt, the above principle is subject to the qualification of a duty to mitigate. That is, where a person establishes/proves a breach of contract by the other party to that contact, that person (the injured party) should be placed, as far as money can do it in the same position he/she would have been had the contact not been breached. However, the injured party cannot be compensated for loss, which could have been prevented by reasonable mitigating action by the injured party.
The duty to mitigate equally applies to a breach of a residential tenancy agreement that causes the non-breaching party to suffer loss and damage.
The concept of mitigation is described as follows by J W Carter and D J Harland in "Contract Law in Australia" (4th Edition Butterworths 2002 at [2133]): "(1) steps which the plaintiff has taken which do, in fact, operate to minimise loss; and (2) steps which the plaintiff ought - acting reasonably - to have taken so as to minimise loss or at least not to increase it."
An important point of principle in relation to mitigation is that the plaintiff (the injured party) does not need to show he/she has fulfilled his/her duty, as the onus (evidential) is on the defendant (the breaching party) to show that he/she has not and to show the extent to which he/she has not done so: see TCN Channel 9 v Hayden Enterprises Pty Ltd (1989) 16 NSWLR 130 at 158 and TC Industrial Plant Pty Ltd v Robert's Queensland Pty Ltd (1963) 180 CLR 130 at 138.
That is, where a party (the injured party) to a residential tenancy agreement makes a claim for damages arising from a breach of the agreement, it is the breaching party who bears an evidential onus that the injured party did not mitigate his/her loss. Once raised, the onus remains on the injured party that he/she did mitigate his/her loss.
Hence, in this case the onus was on the appellant to provide evidence of the respondent having failed to mitigate her loss and evidence of the steps she should have taken. In this regard, the evidence of the appellant was that prior to being served with the 20 June 2014 Notice of Termination she had advised the respondent's leasing agent of ongoing water damage and damage to the doors and requested that they be repaired, which the respondent refused to repair. However, the appellant did not go on to say, or provide evidence that had the requested repairs been undertaken the cost of such repairs would have been far less than what was claimed by the respondent at the time of the hearing. Instead, her evidence was that the doors were old and rotten even at the time she entered the tenancy agreement.
The issue of the requested repairs was raised during the course of the hearing below. However, it was not raised as an issue going to mitigation of loss. We note the respondent and her leasing agent denied receiving any request for repairs by the appellant and when the Tribunal asked the appellant whether her request was made in writing, she said "no". Yet the respondent's evidence does contain material, which supports that of the appellant. For example, the "Rental History Check" and the "Tenant Ledger" the leasing agent had sent to the appellant on 9 September 2014. That there had been a water leak in the bathroom was not denied. The respondent had arranged for the repair of the leak in late May and early June 2014 and the respondent's leasing agent also made reference to ongoing leaks in the roof up until the appellant vacated the premises. The respondent in her note to the leasing agent also made reference to the appellant having reported ongoing leaks and the doors needing repair. This evidence, in our view was relevant to the issue as to whether the appellant had caused the alleged damage and not relevant to the issue of mitigation.
Accordingly, we are not satisfied the appellant has established this ground of appeal.

Ground (f) - the respondent did not submit any evidence that the appellant kicked the cupboard doors or had in fact caused the alleged damage

Even if the appellant's contention that the respondent did not submit any evidence that she had kicked the doors is accepted, the Tribunal did not make any finding that she had done so. Accordingly, this ground of appeal must fail.
The appellant's contention that the respondent did not submit any evidence that she had caused the alleged damage cannot be accepted. In this regard the respondent submitted considerable evidence and material in support of her claim, including the Residential Premises Condition Report (the Condition report), signed by the appellant at the commencement of the tenancy, and the photographs taken by her leasing agent at the commencement of the tenancy and after the appellant had vacated the premises. Whether that evidence was sufficient to prove, on the balance of probabilities, the appellant had caused the alleged damage as depicted on the photographs taken after the tenancy ended was for the Tribunal to determine having regard to the applicable law and the material before it, including that provided by the appellant.
As we have noted, in giving its oral reasons for decision at the conclusion of the hearing the Tribunal found for the respondent in respect of each item of damage claimed, other than the cleaning. However, in our view, these oral reasons for decision fail to adequately meet the requirements of subs 62(3) of the Civil and Administrative Tribunal Act and it is this failure which more appropriately relates to the appellant's contention that the Tribunal ignored her evidence in reaching the conclusion that: "… [on] balance I find that this [the alleged damage] is not wear and tear in the property and not repairs to which the landlord had to perform. I am satisfied that there was, maybe not intentional but certainly negligent damage to the premises during the tenancy and I am satisfied that the rest of it is payable by the tenant."
As noted above, what was in dispute before the Tribunal was respondent's claim for repairs. To succeed in her claim the respondent was at all times required to prove, on the balance of probabilities, that: 1. the appellant, through her acts or omission, breached one or more specific obligations imposed on her under tenancy agreement (i.e. proof of a breach); 2. as a result of the appellant's breach of the agreement, the respondent suffered loss and damage (i.e. proof that the alleged damage arose from the proven breach); and 3. the amounts claimed by the respondent are the costs incurred to repair or replace the items damaged by the appellant as a result of her breach (i.e. proof the repair costs related to the proven damage arising from the proven breach).
That is, the Tribunal was required to make findings of fact in regard to each of the abovementioned matters in order to make the orders sought by the respondent in her claim.
The appellant's claim was a defensive claim to that of the respondent. In defending the respondent's claim the appellant bore an evidential onus to provide sufficient evidence to counter the evidence of the respondent. Whether that evidence was accepted, as proof of the contrary to that alleged by the respondent in her evidence, was a matter for the Tribunal to determine as part of its fact finding role. The appellant also bore an evidential onus in regard to the issue of mitigation, whether the alleged damage was fair wear and tear and rebutting the presumption in s 30 regarding the Condition Report she had counter signed at the commencement of the tenancy.
The Tribunal in its oral reasons for decision identified the obligations contained in subs 51(1)(d) (negligently cause or permit damage to the premises), 51(2) (failure to notify the respondent of the damage) and 51(3)(b) (leave premises in same condition the premises were in at the commencement) of the Residential Tenancies Act. We do not understand the relevance of the subs 51(2) obligation, as the respondent had not in her allegations included an alleged breach of this kind. Nor did the Tribunal explain, in its reasons for decision, why it considered this obligation to be of relevance to the circumstances before it.
Accordingly, the relevant alleged breaches were those contained in subs 51(1)(d) and 51(3) of the Residential Tenancies Act - namely (a) an allegation of intentional or negligently causing or permitting the alleged damage and (b) an allegation of failing to leave the premises as nearly as possible in the same condition as set out in the condition report applicable to the premises at the commencement of the tenancy.
The appellant disputed she had caused any damage to the premises as alleged. She asserted the respondent had refurbished the premises after she left and that she was seeking to recover the costs of this from her. In regard to the specific items claimed by the respondent her evidence was: 1. at no time did she have a telephone connected to the phone connection in the premises - the connection was in the same condition as it was in when she commenced her tenancy and there was no evidence before the Tribunal as to the condition of the connection at the commencement of the tenancy; 2. the toilet seat was not broken when she left and there was no evidence before the Tribunal to show that it was broken when she vacated the premises; 3. the curtains were old and torn at the commencement of the tenancy as noted by her in the Condition Report at the commencement of the tenancy; 4. the doors were old and rotten - they made of "chipboard" and had deteriorated further during the tenancy because of the water leaking from the bathroom and the ceiling. As a consequence, "one by one just after simply opening these very old deteriorated kitchen and bedroom doors made of chipboard the doors rotted away at the hinges and very easily came undone just by opening them." She requested that they be repaired and but no action was taken. Instead she was given a no cause Notice of Termination shortly after having requested that they be repaired (i.e. on 20 June 2015); 5. the damage to the ceiling in the bathroom arose from the leaks that were repaired by the respondent in May/June 2014 and not from anything she had done; 6. the painting and other work as set out in the invoice of Fairdinkum Handyman Services were not repairs due to a breach of the lease, but were refurbishments to, or betterment of the premises undertaken by the respondent after the appellant vacated the premises; and 7. there was no Condition Report at the conclusion of the tenancy.
As we have noted, in her evidence the respondent acknowledged there had been leaks within the premises and they were ongoing. There was also evidence that the premises were 30 years old and the doors had not been replaced in that time. The respondent also acknowledged that some of the tasks set out in the invoice of Fairdinkum Handyman Services was for work that she had requested to be done and which did not arise from any alleged damage by the respondent. That invoice we note consisted of a list of services provided. At the bottom of the invoice the total amount for material supplied, the total amount for labour and the total amount owing was added. The amount for material supplied was $358.21 and the amount for labour was $2040.
It would appear that subsequent to the invoice being issued someone has hand written against each item on the list of services the cost for that item and what proportion was being claimed against the appellant. Who wrote these is not explained in the evidence, nor did the Tribunal deal with this issue even though the appellant had contended the respondent was seeking to recover from her the cost of refurbishment and noted that there were no individual receipts attached to the invoice which supported the amounts charged for the materials supplied. If they were included in the invoices and receipts attached to the respondent's summary of expenses, there would have been double counting.
In our view, while the Tribunal Member was not required to deal with the evidence in any great detail when giving his reasons for decision, the Member was required to deal with those matters material to the allegations contained in the respondent's claim and which were disputed. This required making findings on material fact, based on the evidence, and the Tribunal Member explaining his reasoning process in reaching those findings. In our view, the Tribunal Member failed to do so in his oral reasons for decision. He made no mention of the evidence of the appellant or the respondent, or his findings on material facts relevant to the respondent's claim based on that evidence and the relevant provisions of subs 51(1)(d) and (3)(b) that would enable one to discern how he reached his conclusions that: (a) the alleged damage, other than the cleaning, was not wear and tear, (b) the damage was not repairs the respondent was responsible for and (c) the appellant had negligently caused the damage.
Accordingly, we find the Tribunal failed to give adequate reasons for decision in regard to both application because they did not comply with the requirements of subs 62(3).

Conclusions

For the reasons stated above, we find that the Tribunal has erred in law in that its oral reasons for decision failed to comply with the requirements of subs 62(3) of the Civil and Administrative Tribunal Act. As we have noted, this is an error of law which gives rise to a right of appeal. We accept it is also relevant to a finding that the decision was not just and equitable and are satisfied that had the Tribunal not so erred there is a "significant possibility" or a "chance which was fairly open" that a different and more favourable result would have been achieved for the appellant. Accordingly, we are satisfied that the appellant may have suffered a substantial miscarriage of justice.
In light of our findings it is appropriate to grant leave to appeal and allow the appeal in so far as it relates to: 1. the appellant's claim for an order for the payment of the rental bond; and 2. the respondent's claim for repairs, other than that relating to cleaning. The respondent has not cross claimed in regard to this aspect of its claim so the finding of the Tribunal should stand in this regard.
In light of the appellant's concession, the Tribunal's order in so far as it relates to the outstanding rent should remain.
The appellant's claim for an order for the payment of the remainder of the rental bond and the respondent's claim for repairs, other than the cleaning, and an order for the payment of the remainder of rental bond should be remitted to the Tribunal for reconsideration pursuant to subs 81(1)(e) of the Civil and Administrative Tribunal Act. The matter should also be remitted without further evidence and in accordance with these reasons for decision.
The question is whether the matters should be remitted to the Tribunal differently constituted. In this regard we note the observations of Adamson J, in BCS v NSW Civil and Administrative Tribunal [2015] NSWSC 126 at [54], that the power to remit to the Tribunal differently constituted should be exercised with caution and should only be made in the interests of justice: see Yong v Antworks Pty Ltd [2016] NSWCATAP 14 at [137], and Chi Building Pty Ltd (supra) at [60]. In BCS, Adamson J found that it was in the interests of justice to remit the matter to the Tribunal differently constituted because the Tribunal Member who determined the matter at first instance had failed to undertake the statutory task required of him. Adamson J also accepted the arguments of the parties of possible risks of an application of apprehended bias being made by the appellant if the matter was remitted to the same Tribunal Member.
In this appeal neither party has submitted that in the event the appeal is allowed it should be remitted to the Tribunal differently constituted. However, on the basis of the submissions made in this appeal and our finding that the Tribunal Member had failed to undertake the statutory task required of him we also find, in the interests of justice, it is appropriate to make an order that the matters relating to the respondent's claim for repairs and be remitted to the Tribunal differently constituted.
For the reasons set out above, we order: 1. The appellant is granted leave to appeal the decision from the Tribunal in regard to: 1. her claim for the payment of the rental bond (file no RT 14/50030) (RT 14/50030); and 2. the respondent's claim in so far as it relates to repairs (other than the claim for cleaning) and payment of the rental bond (file no RT 14/57076) (RT 14/57076). 1. The appeal from the Tribunal's decision in RT 14/50030 is allowed in part. 2. The appeal from the Tribunal's decision in RT 14/57076 is allowed in part. 3. The decision of the Tribunal in RT 14/50030 is set aside. 4. The decision of the Tribunal in RT 14/57076 is set aside in so far as it relates to the respondent's claim for repairs (other than the claim for cleaning). 5. The decision of the Tribunal in RT 14/57076 is otherwise varied as follows: "1. The tenant is to pay the landlord the sum of $342.86 in respect of rent arrears." 1. The appellant's claim for the payment of the rental bond the subject of this appeal (RT 14/50030) and the respondent's claim for repairs (other than the claim for cleaning) and for the payment of the rental bond the subject of this appeal (RT 14/57076) are remitted for reconsideration to the Tribunal differently constituted. The matter is to be determined without further evidence and in accordance with these reasons for decision.

I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales. Registrar DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 09 June 2016

Motor Compensation Act 1999(NSW)

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