Roberts v NSW Aboriginal Housing Office

NCAT Appeal Panel|2016-12-12

ing Corporation [2011] NSWSC 820 Finn v Finato (Tenancy) [2004] NSWCTTT 179 Flight Centre v Louw [2011] NSWSC House v The King (1936) 55 CLR 499 Insight Vacations Pty Ltd v Young [2010] NSWCA 137 Jackson v NSW Land and Housing Corporation [2014] NSWCATAP 22 Larking v Great Western (Nepean) Gravel Ltd (in Liq) [1940] HCA 37; (1940) 64 CLR 221 Minister for Immigration and Border Protection v Singh and Anr [2014] FCAFC 1 Minister for Immigration and Citizenship v Li [2013] HCA 18 Tralee Technologies Holdings Pty Ltd v Yun Chen [2015] NSWSC 1259 Worrall v Commissioner for Housing of ACT [2002] FCAFC 127 Category: Principal judgment Parties: Zianna Yvette Roberts (Appellant) NSW Aboriginal Housing Office (Respondent) Representation: Counsel: K Young (Appellant) K Madgwick (Respondent)

Solicitors: Legal Aid of New South Wales (Appellant) FACS Legal (Respondent) File Number(s): AP 16/43102 Decision under appeal Court or tribunal: Civil and Administrative Tribunal of New South Wales Jurisdiction: Consumer and Commercial Division Citation: Not applicable Date of Decision: 26 August 2016 Before: K Holwell, General Member File Number(s): SH 16/07826

reasons for decision

The appellant was a tenant in residential premises located in Alstonville, New South Wales, pursuant to a residential tenancy agreement dated 11 January 2002.
The landlord was the NSW Aboriginal Housing Office.
The appellant commenced proceedings in the Tribunal against the landlord by application dated 8 February 2016. In that application, the appellant sought orders for urgent repairs, an order for rent reduction and an order for compensation. The application was heard by the Tribunal on 21 June 2016. The application was dismissed by order made 26 August 2016, the Tribunal providing written reasons for its decision.
The appellant appeals this decision.

Parties to the appeal and time to appeal

The Notice of Appeal was filed on 27 September 2016. The Notice of Appeal listed the respondent as NSW Land and Housing Corporation. NSW Land and Housing Corporation was also named as the respondent in the proceedings at first instance.
During the hearing of the appeal, the parties agreed that the correct respondent was the landlord, NSW Aboriginal Housing Office. The parties consented to the Appeal Panel making orders to amend the name of the respondent in the original proceedings and on appeal.
These reasons will refer to NSW Aboriginal Housing Office as the respondent.
In addition, the appellant sought leave to appeal out of time, the Notice of Appeal being an appeal in respect of residential proceedings for which the time to appeal is 14 days from the date of the decision: see rule 25 (4)(b) of the Civil and Administrative Tribunal Rules, 2014 (Rules). The respondent consented to an extension of time.
Accordingly the Appeal Panel made the following order: 1. In application SH 16/07826, the name of the respondent is amended to NSW Aboriginal Housing Office. 2. In appeal AP 16/43102 the name of the respondent is amended to NSW Aboriginal Housing Office 3. By consent, the time to lodge the appeal is extended to 27 September 2016.

Grounds of Appeal and submissions

The appellant relied on an amended Notice of Appeal filed 14 October 2016. In the notice, the appellant appealed the whole of the decision. The respondent did not object to the filing of the amended Notice of Appeal. Further, the respondent did not object to the Notice of Appeal being further amended to seek leave to appeal on a question of fact.
In short, the appellant sought orders that the decision of the Tribunal be set aside, that the matter be remitted to a differently constituted Tribunal for determination in accordance with law and that fresh evidence be permitted in any rehearing by the Tribunal.
During the hearing of the appeal, the Appeal Panel noted that if it allowed the appeal in whole or in part, it may finally determine the appeal as permitted by s81 of the Civil and Administrative Tribunal Act, 2013 (NCAT Act), rather than remitting the proceedings for further hearing by the Tribunal.
The appellant raise seven grounds of appeal. These grounds were: 1. The Tribunal erred in law in determining the appellant was out of time to make an application for repair and compensation in applying the wrong test in determining the relevant date. 2. The Tribunal erred in law in exercising its discretion in respect to the extension of time under s41 of the NCAT Act, in that it failed to take account of mandatory considerations relevant to that exercise. 3. The Tribunal erred in law in exercising its discretion in respect to the extension of time under s41 of the NCAT act by taking into account irrelevant considerations. 4. The Tribunal erred in law in finding that the respondent landlord had not breached its duty to carry out repairs because such finding was contrary to and not available on the evidence before the Tribunal. 5. The Tribunal erred in law at paragraph [14] of the decision as to whether to make a repair order for the carpet. The Tribunal took into account irrelevant considerations in determining whether to make a repair order; 6. the Tribunal erred in law in that it considered an irrelevant consideration in determining the question of whether the tenant was entitled to a rent reduction or, alternatively, misconstrued the operation of section 44 of the Residential Tenancies Act, 2010 (RT Act). 7. The Tribunal erred in law at paragraph [16] of the decision in applying the Civil Liability Act, 2002 (CL Act) to the appellant's claim for stress, sickness, grief and embarrassment/inconvenience.
At the hearing of the appeal, ground 5 (which related to an order to repair the carpet) was not pressed.
The remaining grounds were the subject of written and oral submissions by both parties.
It is convenient to deal with the submissions of both parties in respect of each of the grounds raised.

Ground 1- Out of time to make application for repairs and compensation

The appellant submitted that the application was not out of time because the obligation upon the respondent to carry out repairs was ongoing, that is a landlord must maintain the residential premises in a reasonable state of repair. The appellant relied on s63 of the RT Act.
The appellant said that despite a number of attempts by the respondent to remedy the problem, "the mould remained an issue even at the date of the hearing and still".
The appellant submitted that while cl22 of the Residential Tenancies Regulation, 2010 (RT Regulation) provides that the time to bring an application runs from when the appellant becomes aware of a breach, the appellant's awareness of the breach is not static in that works were done and issues persisted despite those works. In this regard the appellant referred to a chronology of events set out in the submissions and documents provided on appeal and said that repairs carried out by the respondent were ineffective. In her written submissions, the appellant referred to various decisions of the Tribunal and its earlier manifestations, including the Consumer Trader and Tenancy Tribunal, and said that while the respondent must be aware of the need for repairs before a breach can occur, the mere fact that an attempt is made to repair is no defence to a landlord liability to repair and maintain where such attempts are unsuccessful. Rather, repairs must be effected within a reasonable time.
In relation to s65(3) of the RT Act which limits the circumstances in which the Tribunal can make an order for repairs, the appellant submitted that there was no basis to conclude the mould issue had been fixed with "reasonable diligence".
Further, as the breach was ongoing, the Tribunal was in error at [11] in concluding that the appellant's awareness of the breaches was well before 9 November 2015, which is more than 3 months prior to the date the application was filed on 9 February 2016.
Consequently, the appellant said the three months period prescribed by cl 22 of the RT Regulation did not operate to prevent the appellant applying for orders for repairs and compensation in the present circumstances.
In reply, the respondent said that there were different defects which the residential premises suffered over time which were the cause of mould. The respondent said these defects were rectified as is evidenced by the respondent's work orders and as found by the Tribunal in its decision at [8] - [9]. Reference was also made to evidence from the appellant at transcript T23 line 41-46 that roof tiles had been repaired which had stopped that leak.
Further, the respondent said that it carried out repairs when notified of defects and that the Tribunal found at [10] that it did so with reasonable diligence. Otherwise, the evidence did not show a continuing breach but rather there were discrete defects and if there was an ongoing problem this would have been drawn to the attention of the respondent by the appellant.
Consequently, the respondent submitted that the appellant was out of time to claim compensation for earlier defects and/or to seek orders for repair in respect of those matters of which the appellant was aware more than three months prior to the filing of the original application.

Grounds 2 and 3- exercise of discretion not to extend time under s41

The appellant says that the Tribunal failed to take account of mandatory considerations and also took account of irrelevant considerations. In her amended Notice of Appeal, the appellant identified the mandatory considerations as: 1. the appellant's prospects of success or merits; 2. the continuing pattern of breach by the respondent of its obligation to carry out repairs, rather than an isolated incident; 3. the fact the appellant kept the respondent fully informed of the continuing mild issue; 4. the fact that there was no evidence to suggest the appellant "rested on her rights so as to leave the respondent landlord to believe the matter had been finally concluded"; 5. the refusal of an extension of time would deny the appellant a right to have her claim for repairs and compensation considered by the Tribunal.
In relation to irrelevant considerations, the appellant identified the following: 1. the Tribunal incorrectly considered the prejudice to the respondent arising from an extension of time which might expose the respondent to a claim for repairs or compensation arising from works carried out in 2014 and 2015; 2. the prejudice identified in (1) is not "prejudice as understood properly at law"; 3. no prejudice could arise where there was an ongoing repair issue which the respondent failed to address.
The appellant submitted that the proper exercise of a discretion to extend time under s 41 of the NCAT required the Tribunal at first instance to have regard to the six factors set out by French J in BHP Billiton Direct Reduced Iron Pty Ltd v Duffus, Deputy Commissioner of Taxation [2007] FCA 1528 at [109]-[113] and that the exercise of a discretion to extend time in first instance proceedings differs markedly from that considered by the Appeal Panel in Jackson V NSW Land and Housing Corporation [2014] NSWCATAP 22 in connection with extending the time to appeal.
The appellant said the Tribunal only considered two of the six relevant factors, that are whether there was a reasonable explanation for delay and whether there was any prejudice to the respondent.
As to the prejudice to the respondent, the appellant reiterated that the fact a claim might be made against it was not of itself relevant prejudice. It is not sufficient that the respondent might be exposed to a claim earlier in time, rather the prejudice must arise out of the inability or difficulty which the respondent might suffer in producing evidence and conducting a defence of a claim brought late. That is, there must be a prejudice of a forensic type and, so the appellant submitted, there was no such prejudice in this case.
Otherwise, the appellant submitted that she had not rested on her rights and she should not be prevented from having her claim determine on its merits.
Consequently, there was an error of law of the type set out in House v The King (1936) 55 CLR 499 at 505-506 and the exercise of the discretion miscarried.
In reply, the respondent submitted that no adequate explanation for delay in bringing proceedings had been provided by the appellant. Rather, all the appellant had asserted was that there had been a continuing breach by the respondent in failing to effect repairs.
Insofar as the appellant sought orders for the carrying out of repairs, it would in any event be futile to now extend time and/or remit the matter for rehearing because the appellant had left the residential premises.
The respondent said the appellant sought orders for compensation, the breaches relating to mould and an alleged electrical fault which caused the appellant to incur increased electricity charges.
In relation to the increased electricity charges, the respondent submitted it was open, on the facts, for the Tribunal to conclude any breach had occurred prior to 9 December 2015 and it could not be said in any relevant sense that such a breach was a continuing one in the circumstances.
In relation to the claim for compensation for "stress and sickness" arising from the mould, the respondent submitted that the Tribunal found at [8] and [9] of the decision that there were distinct and separate mould problems rather than an ongoing problem with mould. Consequently, the factual basis relied upon by the appellant as justifying an extension of time, namely a continuous and ongoing problem, has not been established and no explanation has otherwise been provided about the delay in commencing proceedings for breach is said to have occurred in 2013 and/or 2014.
As to the prospects of success, the respondent says the Tribunal clearly evaluated the substantial merits of the appellant claim as demonstrated in the decision at [5], [8]-[10], [15] and [16]. Consequently, the decision not to extend time, when read as a whole, should not be considered erroneous.
In reply, in respect of the claim for compensation in connection with additional electricity charges, the appellant accepted that the electricity accounts of themselves were not sufficient to prove a breach by the landlord of an obligation to repair nor that the charges incurred arose from such a breach. In this regard the appellant did not suggest to the Appeal Panel that she had been denied an opportunity to present relevant evidence to prove her case at the original hearing.
In relation to the history of repairs carried out by the respondent, the appellant said it was necessary for the Appeal Panel to have regard to the work orders of the respondent and requests made by the appellant. However the appellant said no inference should be drawn against her based on the respondent's document p43 (entry Repair Number 10179321) found wants a new home.

Ground 4- Landlord not in breach of obligation to repair

The appellant submitted that the finding by the Tribunal that the landlord was not in breach of its obligation to repair was contrary to and not available on the evidence. The appellant said the decision was so unreasonable that it is not a decision which a reasonable decision maker could make. In this regard the appellant relied on the decision of the High Court in Minister for Immigration and Citizenship v Li [2013] HCA 18 and Minister for Immigration and Border Protection v Singh and Anr [2014] FCAFC 1. Those cases, the appellant submitted, identified two different contexts in which an error of law might be made. First, where the error amounts to a jurisdictional error in the decision-making process, and secondly, where a decision is made that "is arbitrary, capricious or without "common sense".
The appellant says that the evidence discloses the respondent: 1. took 14 months to undertake an urgent repair (roof leak), 2. took 27 months to repair extensive mould issues within the premises; and 3. the respondent was "on notice that the mould was aggravating the appellant's medical issues for some 24 months before it took steps to rectify the mould issue".
Having regard to the above facts, the appellant says the decision of the Tribunal that the respondent had not breached its duty to carry out repairs "does not fall within a range of possible, acceptable outcomes which are defensible in respect of the facts and law" and the decision "lacks common sense or an intelligible basis.
In reply, the respondent said there was evidence before the Tribunal to demonstrate that the respondent carried out repairs to the roof at the end of 2014 and that those repairs resolved the roof problems at that time. Also, the respondent says it was open to the Tribunal to find there was no mould from the end of 2014 until September 2015. Finally, the respondent said that there was material before the Tribunal which indicated substantial repair work had been done to the ceilings of the premises in December 2015 and that it was therefore open to the Tribunal to conclude there had been no failure of the respondent to act with reasonable diligence to repair the mould problem.
Consequently, no relevant error was made by the Tribunal in rejecting the appellant's claim.
Further, in oral submissions the respondent said that, in any event, the claim for compensation was not clear and the manner in which the appeal is being run is different to the manner in which the claim for compensation was presented to the Tribunal.

Ground 6- Misconstruction of s44 of the RT Act and taking account of irrelevant considerations

The appellant said that the Tribunal rejected the appellant's claim for an order to reduce the rent because the Tribunal found there had been no withdrawal of goods, services or amenities. In making this decision, the appellant said the Tribunal failed to consider whether there had been a reduction (rather than withdrawal) of goods, services and amenities.
The appellant submitted that the construction placed upon s44 by the Tribunal was too narrow. The appellant said that the fact that there was no evidence that particular rooms or the whole of the house could not be used did not mean there had been no relevant withdrawal or reduction of goods, services and amenities. Rather, the appellant said that the ongoing failure of the landlord to keep the premises in repair and the continuing presence of mould were circumstances sufficient to support a conclusion that there had been a reduction or withdrawal of facilities within the meaning of s44 of the RT Act. In this regard the appellant relied on various decisions of the Tribunal including Anthony v Mao [2014] NSWCATAP at [25].
Consequently, the appellant said an order to reduce the rent should have been made.
As to the amount of the reduction, the respondent submitted that three bedrooms, a bathroom and the carpet were affected by mould. The appellant sought a rent reduction of $100 per month, the rent payable under the residential tenancy agreement being $320.00 per week.
In reply, the respondent said in written submissions at [32]: There was no substantive evidence of a withdrawal or reduction of goods, services or facilities provided with the residential premises and no submissions made in this regard. The amount of the rent reduction was accepted to be "arbitrary" and no attempt was made to identify or quantify the loss of "facilities" as the appellant puts it on appeal.
The respondent then referred to the decision of the Appeal Panel in Anthony at [46] and said that a claim for an order for rent reduction cannot succeed unless there is evidence to demonstrate that a landlord's conduct in failing to attend to repairs amounted to a reduction or withdrawal of goods, services or facilities.
In oral submissions, the Appeal Panel raised with the respondent the question of whether "withdrawal" meant that particular goods, services or facilities could not be used and whether "reduction" meant that such facilities could still be used, but only partly. The respondent accepted that if a wide definition was given to the meaning of "reduction or withdrawal" in s44 then the Tribunal's conclusion that there was "no evidence" would be wrong.

Ground of 7- Application of the CL Act to the claim for stress, sickness grief and embarrassment

The appellant submitted that the claim made to the Tribunal for stress, anxiety, sickness and embarrassment was not a claim for personal injury and was not a claim for "non-economic loss" within the meaning of the CL Act. Consequently, s16 of the CL Act did not prevent the Tribunal from making an award in the present circumstances.
The appellant said there was "competing lines of authority" concerning whether or not the present claim was prevented by reason of the CL Act. The appellant referred to the decision of the Court of Appeal of the New South Wales Supreme Court in Insight Vacations Pty Ltd v Young [2010] NSWCA 137 and submitted: In Insight, the Court of Appeal dealt with a case in which a physical injury had occurred which produced a measure of grief and inconvenience. It held that where an injury had occurred it was not possible to dissect out the grief and inconvenience caused by the injury itself such that the CL Act applies both to the injury and its emotional sequelae.
The appellant also referred to the subsequent decision of Barr AJ in Flight Centre v Louw [2011] NSWSC 132, (2010) 78 NSWLR 656 where His Honour concluded that a breach of contract claim for damages for inconvenience, distress and disappointment suffered in consequence of construction work being carried out next to holiday resort accommodation was a claim for non-economic loss within the meaning of the CL Act.
The appellant then submitted that the decision of Harrison AsJ in Fawzi El-Saeidy v NSW Land and Housing Corporation [2011] NSWSC 820 correctly distinguish between claims which were personal injury claims and those which were not. In this regard the appellant relied upon Her Honour's reasons at [95] where she said: The plaintiff has not claim damages for physical injury. He has claimed damages for discomfort and loss of enjoyment. It is my view that these types of damages do not fall within the definition of personal injury contained in the Civil Liability Act. Therefore Act (sic) does not apply.
The appellant said this view is supported by the decision of Bellew J in Tralee Technologies Holdings Pty Ltd v Yun Chen [2015] NSWSC 1259 at [61] - [62].
In her written submissions at [74], the appellant then said: Similarly in this case, the claim for damages made by the appellant was for damages for "stress, anxiety, sickness and embarrassment." Such a claim arose from loss of enjoyment of the property not from a "personal injury". The appellant never claimed she suffered a physical or mental injury as a consequence of the failure of the respondent to comply with the RT Act or the residential tenancy agreement. As such the appellant's claim did not fall within the ambit of the CL. The Member erred in law in determining that it did.
As to the issue of sickness, the appellant said this claim was made in 2013.
In reply, the respondent relies on the decision of Bellew J in Tralee and says that no claim was made in the present case for loss of enjoyment. Rather, the present claim is for "stress and sickness", a category of non-economic loss within the meaning of the CL Act.
Further, the respondent submitted that in any event the nature of the claims made in the present case were not of a type found in Tralee (loss of enjoyment of a prestigious quality premises intended to be used to entertain prospective clients and investors) or in El-Saeidy (loss of enjoyment arising from physical inconvenience).
Consequently, the respondent submitted that the appellant's claim for damages could not be maintained and was properly dismissed.

Consideration

This is an appeal brought in relation to residential proceedings. There is a right of appeal on a question of law and otherwise with leave of the Appeal Panel: s80(2)(b) of the NCAT Act. Leave may only be granted if the appellant may have suffered a substantial miscarriage of justice: Sch4 Cl 12 NCAT Act.
The appellant originally raised seven grounds of appeal, however ground five was not pursued.
A resolution of the appeal requires a consideration of what orders were originally sought by the appellant in her application to the Tribunal.
A copy of the application dated 8 February 2016 is found that tab 4.1 of the appellant's bundle. In section 12 of that application the appellant sought the following orders: s64 Order for urgent repairs s45 Order for rent reduction s187 Order for compensation
In section 13 of the application the appellant said: 1 Have asked for repairs to the ceiling in 3 bedrooms, bathroom and laundry within last 12 months. No repairs had been done yet. However my landlord wanted to cover over the top of the existing ceiling to cover the existing bad mould caused by leaks in the roof. My landlord sent a plasterer to cover over the top of the existing mould affected ceiling. However, he was reluctant to do this as he felt the ceiling needed to be actually replaced. I have photos of the ceiling and the damage it has caused to my possessions. Now I seek repairs to the ceiling and carpet and compensation in above orders as follows: Rent Reduction $100 pw for the last 12 months. 2 Compensation of $12,400 due to damaged (sic) cause to my possessions by my landlord's failure to promptly do repairs, stress and sickness. 3 Repair is also needed to the electrical wiring inside the premises.
The appellant also provided to the Tribunal a further document setting out the basis of her claim in the following terms (appellant's bundle Tab 4.1): I refer to the above application in which is listed to be heard in the near future. I have applied for orders for repairs, rent reduction and compensation. I have been complaining to my landlord about repairs needed to the roof, electricity problems and that the bad mould situation. Replacement carpet is also needed given mould is exists (sic) in the carpet. I and my family have been suffering from stress, anxiety, sickness and embarrassment due to my landlord failing to do repairs. All the repairs have since been done except the carpet that requires replacing. My electricity costs were increased due to the failure of my landlord to repair the electrical faults, now since the electrical problem has been fixed my costs have reduced the normal amount of usage costs. The ceiling was a been placed and it was evident that is best existed in the previous ceiling. I believe that my family's illnesses were caused by the asbestos and mould problems due to the failure of my landlord to repair.
As is evident from the application and the above document setting out her claim, the appellant sought the following orders: 1. An order that repairs be carried out the premises, including to remove mould and replace the carpet. 2. An order to reduce the rent. 3. Compensation for damages to possessions caused by mould. 4. Compensation for "stress, anxiety, sickness and embarrassment" caused by asbestos and mould. 5. Compensation for additional electricity usage charges caused by the "failure of the (respondent) to repair electrical faults".
All these claims were dismissed by the Tribunal. In doing so the Tribunal made the following findings: 1. A mould issue was reported in September 2013 in connection with the bedrooms and bathrooms the residential premises. A medical report at that time stated the appellant was affected by mould in the house. An inspection was carried out by the respondent on 24 November 2014 and roof repairs completed on 26 November 2014: decision [8]; 2. In September 2015 the applicant reported there was a roof leak and claim mould issues had reappeared in the bedrooms and bathroom. The respondent raised work orders to complete the works inside the dwelling in October 2015. After a further inspection by the appellant's advocate in November 2015, the respondent carried out further roof repairs and replaced the ceilings in the bedrooms and bathroom in December 2015. The works were completed on 18 December 2015: decision [9]. 3. During the carrying out of the repairs in December 2015, the respondent paid for alternative accommodation for the applicant and her son: decision [9]. 4. In carrying out repairs in 2014 and 2015 the respondent acted with reasonable diligence, including in carrying out repairs to the roof, ceilings and electrical wiring: decision [10]. 5. The claims for repairs and compensation are out of time because the appellant was aware of the alleged breaches more than 3 months prior to the date the application was filed on 9 February 2016. Therefore the claims for orders for repairs and compensation were out of time: decision [11]. 6. Time to bring the claims for repairs and compensation should not be extended under s41 of the NCAT Act because no reasonable explanation was provided for the delay in bringing an application to the Tribunal and the respondent would be prejudiced in respect of any claim for repairs or claim for compensation arising out of works carried out in 2014 and 2015: decision [11]. 7. In respect of the rent reduction claim, this was in time. However because the premises were fully occupied and there was no evidence that the rooms could not be used, there was no withdrawal of services. Further, in December 2015 the appellant was provided with alternative accommodation during the period she and her son were required to vacate the premises: decision [12]. 8. An order for repairs should not in any event now be made and/or such an order would be pointless. The water leaks have been repaired, the ceilings have been replaced and repairs otherwise completed except for the carpet. In respect of the carpet, a work order should not be made because the appellant was vacating the premises and the respondent was otherwise refurbishing the premises prior to any new tenant taking possession. Further, some carpet damage appeared to have been caused by a water leak from the bathroom into the bedroom, a matter not reported by the appellant to the respondent: decision [14]. 9. In respect of the claim for compensation in respect of goods damaged by mould, there was no evidence to prove these claims, no inventory of items claimed nor any evidence of the date the items were purchased or the cost: decision [15]. 10. In relation to the claim for excess electricity charges, again no evidence was provided: 1. from an electrician to support the existence of a fault causing the problem; or 2. to substantiate the amount claimed and how it has been calculated. decision [15] 1. The claim for stress, anxiety sickness and embarrassment is a claim for non-economic loss in regard to personal injury and cannot be maintained because of the CL Act: decision [16].
In relation to these findings, the following matters were not in dispute in the appeal: 1. The appellant did not challenge the findings that there was no evidence of damage to possessions or the cost of rectifying such damage; 2. The appellant accepted, during the hearing of the appeal, that the evidence provided by way of electricity accounts was not sufficient to prove this claim and did not assert she had been denied an opportunity to present relevant evidence at the original hearing;
It follows that in respect of these claims for compensation that the appeal should be dismissed.
Further, because the appellant has now vacated the residential premises, it would be pointless to make an order remitting the proceedings to re-determine any issue concerning the making of an order that the respondent carry out repairs to the residential premises under s 65 of the RT Act. In this regard the Appeal Panel notes the original application sought orders for urgent repairs under s 64 of the RT Act. However s64 in enables a tenant to affect urgent repairs to a value not exceeding $1000 and to obtain reimbursement from a landlord if certain conditions are met. Accordingly this part of the appeal should also be dismissed.
Consequently, the only issues requiring determination on the appeal relate to: 1. the claim for compensation for stress, anxiety, sickness and embarrassment; 2. the claim for reduction in rent.
It is convenient to deal with the grounds of appeal by reference to each claim.

Claim for compensation for stress, anxiety, sickness and embarrassment

The claim for compensation brought by the appellant totals $12,400. As indicated in the application before the Tribunal, this amount included compensation for damage to possessions as well as compensation for stress, anxiety, sickness and embarrassment. In respect of the claim for stress, anxiety sickness and embarrassment, no claim was made for direct economic loss.
Grounds 1, 2, 3, 4 and 7 of the appeal relate to the claim for compensation for stress, anxiety, sickness and embarrassment. However, a resolution of this aspect of the appeal only requires a determination of ground 7. This is because if the claim is properly categorised as a claim for non-economic loss within the meaning of the CL Act, it cannot be maintained because of the limitation in s16 the CL Act.
Non-economic loss is defined in s3 of the CL as follows: non-economic loss means any one or more of the following: (a) pain and suffering, (b) loss of amenities of life, (c) loss of expectation of life, (d) disfigurement.
Section 16(1) of the CL Act provides that "no damages may be awarded for non-economic loss unless the severity of the non-economic loss is at least 15% of a most extreme case". The limit of damages for the most extreme case is $350,000 and there is no evidence to suggest and amount greater than $52,500 (15% of $350,000) might be awarded in respect of the appellant's claim. Further, and in any event, the Tribunal's jurisdiction is limited to $15,000.00 in respect of a claim for compensation: see cl 23(b) of the RT Regulation.
As identified by the parties in their submissions on appeal, what is non-economic loss arising from personal injury has been considered by the New South Wales Supreme Court and the Court of Appeal in various decisions. In Tralee, Bellew J said at [54]-[62]: 54 Spigelman CJ re-visited the issue in Insight Vacations Pty Limited v Young [2010] NSWCA 137 (at [78]-[79]) and concluded that grief, anxiety, distress and disappointment were elements of pain and suffering within the definition of "non-economic loss" contained in s. 3 of the CLA. In the same case, Basten JA (with whose reasoning Spigelman CJ agreed) said (at [125]): "It is undoubtedly true, as the Chief Justice noted in Ibbett at [21], that injury to reputation, deprivation of liberty and outrage, humiliation, indignity and insult are not commonly referred to as forms of personal injury; rather they usually derive from torts other than negligence, often intentional torts. Matters such as grief, anxiety, distress and disappointment, may fall into a different category. They can be elements of pain and suffering which are the subject of awards for non-economic loss. Similarly, as reflected in the definition of non-economic loss in the Civil Liability Act, an award may be made for "loss of amenities", to cover the non-economic loss resulting from "the deprivation of the ability to participate in normal activities and thus to enjoy life to the full and to take full advantage of the opportunities that otherwise it might offer": Teubner v Humble [1963] HCA 11; 108 CLR 491 at 506 (Windeyer J). … These, however, are heads of damage which fall within the general law understanding of non-economic loss and the statutory definition of that term. Accordingly, they are subject to the constraints imposed by s 16." 55 In State of NSW v Williamson [2011] NSWCA 183 Campbell JA (at [67]) considered that the extension of the ordinary meaning of "injury" to impairment of a person's mental condition effected by s. 11 of the CLA "could arguably" have the effect that damages for anxiety and distress could be personal injury damages within the meaning of s. 11. However, his Honour made it clear that it was unnecessary to decide the question whether this was in fact so. Clearly, his Honour's comments were obiter. 56 Counsel for the plaintiff in the present case placed significant reliance upon the decision of Harrison AsJ in Fawzi El-Saiedy v NSW Land and Housing Corporation [2011] NSWSC 820. In that case, the plaintiff was a party to a Residential Tenancy Agreement with the defendant and alleged that his enjoyment of the premises, and that of his family, had been curtailed due (inter alia) to the fact that the premises had been found to contain asbestos. Her Honour concluded (at [95]): "The plaintiff has not claimed damages for physical injury. He has claimed damages for discomfort and loss of enjoyment. It is my view that these types of damages do not fall within the definition of personal injury contained in the Civil Liability Act. Therefore Act does not apply." 57 In Flight Centre Limited v Louw [2011] NSWSC 132; (2011) 78 NSWLR 656 the plaintiff, in the conduct of its business as a travel agent, arranged bookings of holiday accommodation and travel. The first and second defendants booked a holiday at a resort recommended by the plaintiff. It transpired (inter alia) that the defendants' stay at the resort was interrupted by construction work which was being carried out at the time. The defendants also complained that they had not been notified of other matters by the plaintiff, including the fact that such construction work restricted their access to an adjoining beach. The defendants sued the plaintiff for breach of contract. The particulars of damage were pleaded in terms of the defendants having suffered "loss, inconvenience, distress and disappointment" arising from the matters referred to above. At first instance, an assessor in the Local Court awarded the defendants damages together with interest and costs. The plaintiff brought an appeal to this Court and argued that the damages sought by the defendants were personal injury damages to which s. 16 of the CLA applied. 58 Barr AJ, having reviewed the authorities, found in favour of the plaintiff, concluding (at [31]): "In my opinion the inconvenience, distress and disappointment experienced by the first and second defendants constituted non-economic loss for the purposes of s 3, being pain and suffering. In my opinion they constituted impairment of the mental condition of each of the first and second defendants and so amounted to personal injury. It follows that the assessor was obliged to ask himself, in accordance with s 16, whether the severity of the non-economic loss was at least 15% of a most extreme case. He did not do so. The plaintiff has established that there was an error of law and has made good its case on the first ground." 59 In considering the application of these various authorities to the present case, it is important to bear in mind the basis upon which the plaintiff brought its claim for damages for non-economic loss. Mr Bradley asserted (at paragraph [31] of his affidavit) that he was "embarrassed" to use the outside of the house for entertaining guests and business visitors". He expanded upon this in his evidence (at commencing at T26 L10): "So the requirement for us was to have a prestigious property, which is one of the reasons that we hired it at the time. The property was, frankly, an embarrassment and it was not a property where you would entertain your friends in the rain, for example, and it was certainly not a property where you would bring prospective investors to, to have meeting (sic), because the, the potential - if it wasn't raining, the potential for rats to scamper up and down the wall would have been an embarrassment". 60 When asked whether other defects affected his aspiration to host people at the property, Mr Bradley replied (commencing at T26 L27): "…. You could not use the outside. …. If it rained it was just unusable because the water would just bounce off the guttering and flow inside". 61 The weight of authority supports the view that a claim for damages for distress, anxiety, or disappointment is a claim for damages to which the CLA will apply. However in my view that was not the claim brought by the plaintiff in the present case. Although Mr Bradley made reference to the property being an "embarrassment" that was not, in my view, an expression of distress, anxiety, disappointment or any similar emotion. It is apparent from those extracts of his evidence above that the claim for damages for non-economic loss arose from a loss of enjoyment of the property. That was not a claim for personal injury damages. 62 In my view, the Magistrate erred in reaching a contrary conclusion. Her Honour found that there was a "conflict" between the decisions in El-Saiedy and Louw. In my view, the differing conclusions reached in those cases is explained by the fact that the respective claims for damages were brought on different bases. The claim brought in El-Saiedy was one for discomfort and loss of enjoyment of the property. That brought in Louw was one for inconvenience, distress and disappointment. The differing bases upon which the respective claims were brought explain why different conclusions were reached. They also explain why Harrison AsJ in El-Saiedy did not consider (and was apparently not taken to) the various decisions of the Court of Appeal which support the proposition that claims for damages based upon anxiety and distress are claims which attract the provisions of the CLA.
As recorded in the decision of the Tribunal, the appellant tendered a medical certificate in support of the contention that the state of the premises had made the appellant's son sick. That is, the nature of the claim being pressed by way of compensation (other than the claim in respect of damage to possessions) included a claim for compensation for ill health in consequence of the breach of contract. In our view, such a claim can only be categorised as a claim for personal injury caused by the alleged breach. Further, the appellant's claim for stress and anxiety are also properly categorised as claims for personal injury: see Insight per Spigelman CJ at [78] and Basten JA at [125]-[127], Flight Centre at [31] and Tralee (supra). In these circumstances the compensation sought was properly categorised as a claim for non-economic loss within the meaning of the CL Act. Therefore s16(1) operates to prevent an award being made in favour of the appellant for the amount claimed.
While a claim for damages may be made on the basis of breach of the appellant's right to quiet enjoyment, such a claim was not made in the present case. This was in circumstances where the appellant was represented and was afforded an opportunity to formulate a case in such manner as she wished.
Rather, in relation to the breach of the obligation to repair the premises a claim was only made for compensation for damage to possessions and for "stress, anxiety, sickness and embarrassment". While the Tribunal is not bound by the formality of pleadings, it was required to determine the claims actually made, not some different claim that could have been made. In this regard there was nothing in the documents or in the transcript of the original hearing that would suggest a claim for loss of enjoyment was being brought by the appellant.
This view is supported by the fact that a separate claim was made by the appellant for a reduction of rent arising from the state of repairs of the premises and the withdrawal or reduction of services, the assessment of which required a consideration of the state of the premises and whether there had been a reduction or withdrawal of services.
That is not to suggest that a claim for damages for loss of quiet enjoyment and an order for the reduction of rent are mutually exclusive forms of relief. Depending on the claims made, there may be facts common to both types of claim which would need to be taken into account in order to avoid double compensation. For example if the premises (or part thereof) cannot be used in the manner intended or its use is in some way impaired by reason of a landlord's breach, it may be inappropriate to both reduce the rent and make an award of damages for loss of use.
Absent such an alternative claim, it would have been inappropriate to extend time in any event because the claim made was one to which the CL Act applies.
While unnecessary in light of our findings above, we should briefly deal with the appellant's submission that the claim for compensation was brought in time.
The appellant submitted the claim was in time because of continuing breach. In this regard the appellant relied on s63(1) of the RT Act which provides: A landlord must provide and maintain the residential premises in a reasonable state of repair, having regard to the age of, rent payable for and prospective life of the premises.
The appellant said that the obligation to maintain gave rise to an ongoing breach and the appellant's "'awareness' of the respondent's failure to do the repairs within a reasonable time varied according to the statements and actions of the respondent and the agent and the changing severity of the mould". Therefore, the appellant said that the provisions of cl22(9), namely that an application must be made "within 3 months after the applicant becomes aware of the breach", did not operate to prevent the appellant from bringing the original application and that "(i)t was only when the problem worsened in late 2015 that the appellant relevantly became aware of the breach and applied to NCAT". Further, the appellant said that "(i)t was only when the appellant took back possession on 21 December 2015 (that is after the repairs in December 2015 were complete) that she became aware that the respondent had failed to address the entirety of the mould issue.
It can be accepted that an obligation to maintain can give rise to an ongoing obligation rather than a single obligation that is breached once and for all. As Dixon J (as he then was) said in Larking v Great Western (Nepean) Gravel Ltd (in Liq) [1940] HCA 37; (1940) 64 CLR 221 at 236: If a covenantor undertakes that he will do a definite act and omits to do it within the time allowed for that purpose, he has broken his covenant finally and his continued failure to do the act is nothing but a failure to remedy is passed breach and not the commission of any further breach of his covenant. His duty is not considered as persisting and, so to speak, being for ever renewed until he actually does that which he promised. On the other hand, if his covenant is to maintain a state or condition of affairs, as, for instance, maintaining a building in repair, keeping the insurance of a life on foot, or affording a particular kind of lateral or vertical support to a tenement, then a further breach arises in every successive moment of time during which the state or condition is not as promised, during which, to pursue the examples, the building is out of repair, the life an insured, or the particular support an provided.
However, the problem with the appellant's submissions is that the claim for compensation (if otherwise maintainable) relates to a series of breaches. While the failure to repair under s63 of the RT Act may give rise to continuing breaches which may entitle the Tribunal to make an order for repair if the provisions of section 65 of the RT Act are satisfied, compensation for each day of breach is, on this analysis, separately claimable and the provisions of cl22(9) would apply to each and every breach. This position is similar to an ongoing failure to pay rent where a money order was sought in respect of a series of breaches. That is not to say that time cannot be extended and/or should not be extended in appropriate cases, however awareness of a particular breach necessarily occurs at a fixed point in time for each such breach.
There is a further problem with the appellant's submissions. That is, the findings of the Tribunal to which we have referred at [71] of these reasons suggest that the issue of mould was not continuing. Rather, mould was a consequence of different defects which were rectified from time to time. While the mould reappeared, the problem arose from different causes and the need to carry out different repairs. Further, the mould in the carpet appears in part to have been caused by a water leak in the bathroom which the Tribunal found had not been reported to the respondent by the appellant. Consequently, there would be separate claims for each and every breach and separate time limits would apply.
These matters would count against the appellant's submission that she first became aware of relevant breaches entitling her to bring a claim in December 2015.
Finally, if the breach is said to arise from a breach of the residential tenancy agreement because there was, whatever the cause, an existing mould problem in the residential premises that was never rectified which has affected the appellant's quiet enjoyment of the premises, then the right to claim compensation arises on first becoming aware of the mould problem.
Accordingly, the appeal in respect of compensation for stress, anxiety, sickness and embarrassment should be dismissed.

Claim for reduction in rent.

The second matter to deal with is the rent reduction claim.
As set out in her original application and in the further documents detailing her claim, it is clear that the appellant sought an order for rent reduction because the premises had a "bad mould situation".
Section 44(1)(b) of the RT Act provides: 44 Tenant's remedies for excessive rent (1) Excessive rent orders The Tribunal may, on the application of a tenant, make any of the following orders: …. (b) an order that rent payable under an existing or proposed residential tenancy agreement is excessive, having regard to the reduction or withdrawal by the landlord of any goods, services or facilities provided with the residential premises and that, from a specified day, the rent for residential premises must not exceed a specified amount.
As is evident from the subsection, the Tribunal may make an order to reduce the rent where there has been a reduction or withdrawal of goods, services or facilities.
Further, in determining whether rent is excessive, as specified in s44(5) of the RT Act the Tribunal may have regard to the following factors: (d) the state of repair of the residential premises, (e) the accommodation and amenities provided in the residential premises, … (h) any other matter it considers relevant (other than the income of the tenant or the tenant's ability to afford the rent increase or rent).
In its reasons, the Tribunal said: However the Tribunal finds there has been no withdrawal of services. The premises have fully (sic) occupied. There is no evidence that rooms could not be used. As previously stated when the December 2015 repairs had to be carried out the applicant and her son were provided with alternative accommodation paid for by the respondent.
That is, the Tribunal rejected the appellant's claim because there had been no withdrawal and because there was no evidence that the rooms in question could not be used. Further, the Tribunal concluded that when the premises were repaired in December 2015, the appellant and her son were provided with alternative accommodation. Consequently, the Tribunal dismissed the application for an order to reduce the rent.
In reaching this conclusion, it does not appear that the Tribunal gave consideration to whether or not there had been a reduction in goods, services or facilities as opposed to a complete withdrawal of the said goods, services or facilities. Further, the Tribunal appears to have dealt with the claim on the basis that the respondent effected repairs to the residential premises in December 2015, during which time the appellant and her son were provided with alternative accommodation.
In our view, in making this decision the Tribunal failed to determine whether or not there had been a reduction of goods, services or facilities and incorrectly concluded that it was necessary for the premises or part of the premises to be unusable before an order could be made under s44 of the RT Act. This is an error of law. Further, the Tribunal failed to evaluate the whole of the evidence in deciding whether the goods, services and facilities provided had been reduced by the landlord. Whether this error is classified as an error of law or otherwise, for the reasons that appear below it is an error which should be corrected having regard to the totality of the evidence and to the extent necessary leave to appeal should be granted: see Collins v Urban [2014] NSWCATAP 17 at [66]-[77].
It appears to be common ground between the parties at the original hearing that mould had manifested itself in the premises at various times, at least from November 2014 onwards: see submissions of the respondent advocate (Mr Ford) Ts13 line1-8 and the submission of the appellant's advocate (Mr Webb) Ts p13 line 43-47. The difference between the parties appears to be that, when notified of particular defects arising from water ingress and a leaking roof, the respondent said that repairs had been carried out as and when notified.
It also appears to be common ground that when repairs were carried out in December 2015, including to the roof and the replacement of the ceilings, there was no ongoing mould problem after this time other than perhaps in respect of the carpet: Ts 15 line 43- Ts 16 line 1.
The view that there was, at least, a recurring issue of mould is supported by the documents provided behind tab 8 of the respondent's bundle (which was evidence at the original hearing and in the appeal). These documents appear to be a report in relation to complaints made by the appellant and a Work Order Report recording repairs carried out to the residential premises over time. Indeed, the evidence it is that a mould problem existed as early as September or October 2013. Examples include the following entries: 1. "Tnt has a mould issue in bedrooms and bathrooms, she has watched the walls and has the rooms are ventilated. Her son has muscular dystrophy and she is concerned really his health, pls call her after 23/9/13 to arrange inspection": respondent bundle 83, entry 9282882/11 dated 11 September 2013; 2. "Tnt reporting mould throughout, Bed 1, 2, 3 & bathroom…" Respondent's bundle 82, entry 9897193/11 dated 3 November 2014. 3. "Tnt wanting an inspection re bad mould issues in all bedrooms and bathroom. Roof report raised 9897193/1 & roof repairs 992877/1-the Issue has become much worse. Tnt has child with special needs. Affecting his health": respondent bundle 80, entry 10370472/11 dated 3 September 2015. 4. "Tenant advises that when roof repaired for water leak, no one returned to clean the excessive mould. Please inspect and arrange cleaning if a result of water leak": respondent's bundle 80, entry 10476563/11 dated 23 November 2015.
The extent of the mould was significant, at least in November 2015, as demonstrated by the photographs found in the respondent's bundle at pages 166-181 and 239- 244.
Until the repairs were effected in December 2015, a review of the work order reports suggest that the repair work carried out did not include replacing or repainting of internal surfaces. For example in the repairs carried out in November 2014, there is reference to "Refix roof tiles to whole of roof up to and including 20 tiles - single store" (respondent's bundle page 111) and to "cleanout guttering & valleys stop leaks and straighten guttering" (respondent's bundle page 112) but otherwise no indication that any internal mould problems were addressed at this time. This view is at least corroborated by: 1. the communication from the appellant to the respondent on 23 November 2015 set out above which records the appellant informing the respondent that "no one returned to clean the excessive mould"; and 2. the ceilings were subsequently replaced as part of the work in December 2015.
As referred to above, there was also evidence that the existence of the mould was having an adverse effect on the health of the occupants, at least the appellant's son, and was necessitating the carrying out of additional cleaning work by the appellant due to the recurring nature of the mould.
The question is whether these facts, when considered as a whole, properly amounted to a reduction of services.
There is no doubt a landlord is under an obligation to carry out all repairs necessary to maintain the premises in a reasonable state of repair: see s63 of the RT Act. The obligation to repair includes an obligation to make good and maintain internal surfaces affected by mould which is caused by defects in the exterior of the premises. An order for repairs can be made by the Tribunal under s63(2) of the RT Act in circumstances where the landlord has notice or ought reasonably be aware of the need for repairs but fails to act with reasonable diligence to have the repair carried out: see s65(3) of the RT Act
Where this does not occur, an act or omission by the landlord giving rise to the state of disrepair can amount to a reduction or withdrawal of goods, services or facilities.
Whether there has been a breach of the obligation to repair and what is the nature of the breach depends upon the circumstances giving rise to the complaint and the actions of the landlord in rectifying the defect.
In Finn v Finato (Tenancy) [2004] NSWCTTT 179 the Consumer Trader and Tenancy Tribunal (CTTT) considered the obligations of a landlord to provide and maintain the premises in a reasonable state of repair and the meaning of the expression "fit for habitation", an expression also used in the Residential Tenancies Act, 1987. At [18]-[19], the CTTT said: 16 Section 25(1)(a) of the Residential Tenancies Act 1987 requires the landlord to provide a property in a reasonable state fit for human habitation. Section 25(1)(b) imposes a duty of the landlord to provide and maintain the property in a reasonable state of repair having regard to the age of the premises and the amount of the rent payable during the prospective life of the premises (Roberts and Bell - 00/40837). In a previous case the Tribunal held that the requirement for habitability was a minimum condition beyond which the state of disrepair could not fall. The premises were also badly affected by rising damp and mould causing the tenant to complain about the problem (Edwards and Savires RT01/38788). 17 I refer to "Residential Tenancies Law and Practice New South Wales' (2001 edition 4th) at page 73 where the learned authors state that the objective test is one of contemporary standards in assessing habitability as determined by the tribunal in previous decisions (Lam and Lu RTT90/008960). 18 The leading decision which guides the Tribunal in relation to this standard of habitability is Summers v Salford Corporation [1943] AC 283 in which Lord Atkin said: "If the state of the repair of the house is such that by ordinary user damage may naturally be caused to the occupier either in respect of personal injury to life or limb or injury to health, then the house is not in all respect fit for habitation..... it is clear that premises may be unfit for human habitation even though it is physically possible for a tenant to reside in the premises." 19 In McLeish v FT Eastment & Sons Pty. Ltd (1970) 91 WN (NSW) 268 CA the Court in reliance upon Proudfoot v Hart (1890) 25 QBD 42 considered the words " fit for habitation" and "tenantable repair " and whether there was a difference . This is relevant to a consideration of section 25(1) of the Act, which imports both concepts. The Court stated: "must both import such a state as to repair that the premises might be used and dwelt in, not only for safety , but for reasonable comfort, by the class of persons by whom and for the sort of purpose for which, they were to be occupied.....The conclusion I draw... is that the landlord is obliged to hand the premise over to the tenant, at the commencement of the lease, in a reasonable state of repair having regard to its age, rent payable and the prospective life of the premises, and the state of the repair must at least meet the minimum standard inherent in the contemporary understanding of the term " fit for habitation".
That is, the CTTT concluded that the obligation to maintain includes ensuring the premises do not fall below a particular state of repair. That minimum level is that the premises are fit for habitation, namely that the residential premises can be used and dwelt in not only safely but also with reasonable comfort, being the state of the premises which a landlord is required to provide at the commencement of a residential tenancy agreement.
In the case of mould, its continuing existence within the premises, particularly for an extended time, can result in the premises not being fit for habitation. In such circumstances there is a breach of the obligation to maintain and the fact that the mould is caused by a number of other defects does not relieve a landlord from liability arising from the mould.
That is not to suggest that the mere existence of the mould at any point in time gives rise to a liability in the landlord. Rather, it is the nature and extent of the defect that must be considered in evaluating whether or not the failure to maintain the premises in a reasonable state of repair has been breached because the premises are not fit for habitation.
Further, if the nature of the defect is such that the quiet enjoyment of the premises is affected, again there may be a breach of the residential tenancy agreement, even if the repairs were otherwise effected with reasonable diligence. Such a breach can itself amount to a reduction of goods, services or facilities by the landlord.
In Worrall v Commissioner for Housing of ACT [2002] FCAFC 127, the Full Court of the Federal Court of Australia considered the equivalent provision for quiet enjoyment under the Residential Tenancies Act, 1997 (ACT). Having referred to the provision similar to s63 of the RT Act and the landlord's obligation to repair arising from term 55 of the residential tenancy agreement, the Court dealt with a submission that a breach of the covenant for quiet enjoyment can only occur if a landlord acts unreasonably. The Court said at [68] and following: 68 In none of the terms is it suggested that, to enliven the lessee's rights under terms 86 or 87, it should be determined that the lessor had acted unreasonably or failed to comply with term 55 so as to be in breach of the lease. It is also true that, under the general law, there may be a breach of the covenant for quiet enjoyment by acts performed by or under the control of the lessor which are otherwise lawful. Indeed, the offending acts may have been such that to have refrained from doing or permitting them would have breached other lawful obligations of the lessor. 69 An illustration of such a situation, somewhat analogous to the present, is Owen v Gadd [1956] 2 QB 99. The lessors had let a ground floor shop to the lessee. To effect repairs to the upper floor, they caused scaffolding to be erected. They did what they could to minimise inconvenience to the lessee. They completed the repairs within a fortnight. The scaffolding hindered, but did not prevent, access to the lessee's premises. It obscured his display of wares to some extent. 70 Lord Evershed MR noted that the repairs were both necessary and urgent. The scaffolding, though necessary, as His Lordship concluded at [107], to enable the repairs to be carried out, nevertheless amounted to an interference properly able to constitute a breach of the covenant for quiet enjoyment: "It was said by Mr. Chapman ... that there could be no breach of the covenant for quiet enjoyment unless there was what he called an actual physical interruption into or upon the premises demised on the part of the landlords or some persons authorized by them by their actually entering upon or invading the premises, or by, e.g. the interruption thereon of water emitted from the landlords' premises elsewhere. In my judgment, that submission is not justified by the authorities. I do not think that there is any sufficient warrant for such a limitation [upon the statements of Fry LJ in Sanderson v Mayor of Berwick-on-Tweed (1884) 13 QBD 547]. Concluding, therefore, as I do, that in this case the judge was entitled to find as a fact that the interference was substantial and that there was no principle of law which disqualified him from concluding as he did, I think that this appeal must fail ..." 71 Romer LJ agreed, adding however at 108: "Then comes the question whether the degree of interruption be such as to constitute a ground for legal complaint or whether it should be merely dismissed on the ground of its being of a temporary character or on the ground of de minimis. That appears to me to be essentially a question of fact to be determined by the judge who tries the action . . . I cannot see that the judge's finding should be displaced by the considerations on which Mr Chapman relied, which may be summarized in this way: that the work of external repair which the lessors put in hand was reasonably necessary, that it was efficiently done and was done with all reasonable speed. I do not think that those considerations are really relevant to the question of whether there has been a breach of the tenant's contractual rights under the covenant for quiet enjoyment ..." 72 Birkett LJ also agreed. 73 To similar effect was the more recent decision of this Court in Hawkesbury Nominees Pty Ltd v Battik Pty Ltd [2000] FCA 185. It had, in that case, been contended that failure to repair or maintain the premises' exhaust system was, if anything, a breach of the covenant to repair, not of the covenant to give quiet enjoyment. Further, though not relevant for present purposes, it was contended that the relocation of the fan powering the system had taken place before the lessee became the tenant. The principle adopted, per Hill J at [37], was that: "... there will be a breach of the covenant for quiet enjoyment where the ordinary and lawful enjoyment of the demised premises is substantially interfered with by the acts of the lessor or those lawfully claiming under him, whether or not the title to the land or the possession of the land is otherwise affected. Whether what is complained of amounts to a substantial interference will be a question of fact. A breach may result either from acts of commission or omission by the landlord." 74 There are two conclusions which follow from the cases cited, not only by Hill J, but also by Higgins J at first instance in the Hawkesbury Nominees case. The first is that acts committed or authorised by or on behalf of the lessor may derogate from the grant even if the acts or omissions affect the quiet enjoyment of the premises only indirectly (see also Telex (Australia) Pty Ltd v Thomas Cook & Son (Australasia) Pty Ltd [1970] 2 NSWR 257; Haig v Chesney [1925] SASR 82; Aldin v Latimer Clarke, Muirhead & Co [1894] 2 Ch 437; Lend Lease Development Pty Ltd v Zemlicka (1985) 3 NSWLR 207; Aussie Traveller Pty Ltd v Marklea Pty Ltd [1998] 1 Qd R 1). 75 The second is that, whilst interference with the normal use of premises arising from failure to repair will breach the covenant of quiet enjoyment (see Martins Camera Corner Pty Ltd v Hotel Mayfair Ltd [1976] 2 NSWLR 15), it is no answer to a complaint of breach of the covenant that it was a result of work required by statutory or other lawful authority (see Reid House Pty Ltd v Beneke (1986) 5 ACLC 451). Nevertheless, to be a breach of the covenant there must be a substantial inference with the tenant's quiet enjoyment. That is no different, in substance, from the "significant" diminution referred to in s 71 of the Act. 76 It was open to the Tribunal to have concluded that the conduct of the respondent's contractors, though both lawful and in pursuance of its obligation to repair and necessary to prevent what otherwise would have been a breach of its obligations to maintain the appellant's quiet enjoyment of his premises, could amount to a breach of that covenant. It follows that, insofar as the Tribunal and Crispin J would seem to deny or qualify that proposition, they were in error. It is not an error that affects their ultimate conclusion. It was not relied upon as a reason for concluding that the interference with the use and enjoyment by the appellant of the demised premises was not "significant" or "substantial".
Consequently, each of these circumstances can, if they amount to a reduction or withdrawal of goods, services or facilities by the landlord, entitle the Tribunal to make an order to reduce the rent.
In Eliezer v Residential Tribunal and Ors [2001] NSWSC 1092 McClellan J considered what constituted goods, services and facilities in respect of a similar provision in the Residential Tenancies Act, 1987. His Honour said at [37]: With respect to s 47, I agree with the construction of the Residential Tribunal of the words "goods, services or facilities provided". In my opinion, s 47(1) is confined to the physical and other facilities, goods or services, provided within, or as part of, the tenanted property, and only if the landlord reduces or withdraws those facilities does an obligation arise. In circumstances where there has been a reduction in the quality of the amenity to be enjoyed in the tenanted premises by the actions of a third party, a complete stranger to the tenanted property, no breach of s 47(1) can occur.
As to what constitutes a reduction, in our view this means the goods, services or facilities are of a qualitative or quantitative standard which is less than what a landlord is required to provide under a residential tenancy agreement. On the other hand, a withdrawal suggests there must be a removal or inability to use the particular goods, services or facilities. That is, the goods services or facilities or part of them are no longer available to a tenant.
In the present case, there was evidence that the mould had occurred from the latest November 2014 until rectification work was completed in December 2015. The unchallenged evidence records all three bedrooms and the bathroom of the residential premises were affected by mould. There was evidence that the extent of the mould was significant and that it was having an effect on at least one occupant of the premises, namely it caused the appellant's son to suffer ill-health. There was evidence that the appellant's ordinary use and enjoyment of the premises was adversely affected in that there were smells within the premises, a need to carry out repeated and additional cleaning work to the walls and other areas within the premises and that the rooms were unsightly.
The fact that none of the bedrooms needed to be vacated and/or could still be used for their intended purpose does not mean there has been no relevant reduction. Rather, what must be evaluated is whether the mould (itself a defect) was repaired, what, if any, effect there has been on the ordinary use of the premises and whether by its conduct the appellant has substantially interfered with the appellant's quiet enjoyment.
In our opinion the effects in the present case are obvious. Additional work was required beyond ordinary cleaning to maintain the walls in a reasonable state. It seems when the appellant did this work the mould was temporarily removed. However the evidence makes clear that it returned. Similarly, the environment of the house was adversely affected, particularly in the area with the mould was located. It had a physical and visual impact on the premises and the occupants. Finally, there was no suggestion that the appellant or occupants of the premises were responsible for the mould, at least up until any flooding of the premises which the respondent asserted occurred at the end of 2015.
In these circumstances, we are satisfied there was from at least November 2014 until December 2015 (when internal repair work commenced) a reduction of goods, services or facilities in the residential premises by the respondent. In this regard the evidence shows the appellant was provided with alternative accommodation from 14 December 2015 until 18 December 2015: see respondent's email dated 22 December 2015, appellant's bundle tab 4.2 page 185.
Section 81 gives power to the Appeal Panel to make orders to resolve the dispute, including the power to exercise all the functions conferred or imposed upon the Tribunal at first instance: see s81(2) of the NCAT Act. Having regard to our findings above and having regard to the guiding principle in s36 of the NCAT Act, it is appropriate for the Appeal Panel to deal with all issues on the rent reduction claim rather than remit the proceedings.
While the appellant sought orders that the proceedings be remitted, the Appeal Panel raised with the parties that if the appeal was successful in whole or in part it might make final orders and the parties were invited to make submissions on what orders should be made.
The Tribunal has power to reduce the rent, but such order is limited to a period of 12 months: s44(6)(a) of the RT Act. The evidence shows that in December 2015, substantial repairs were carried out, the mould issue was addressed (except perhaps for the carpet) and that the appellant and her son were provided with alternative accommodation while this occurred. Accordingly, any order should be limited to a period of 12 months prior to this time, that is from 14 December 2014 until 13 December 2015.
The appellant claimed an amount of $100 per week in circumstances where the rent otherwise payable by her was $320.00 per week. No suggestion was made that the rent payable was not market rent (see eg Ts 4 lines 21-22). Neither party suggested that the weekly rent payable did not otherwise reflect the market rent for premises in reasonable condition and complying with the requirements of the RT Act and the residential tenancy agreement.
The appellant was unable to provide justification for the particular amount of $100 per week which had been claimed. Obviously, there is a difficulty in estimating an appropriate amount by which the rent should be reduced in the present case. However, a process of estimation must be undertaken.
In our view, the appropriate amount to allow for reduction of rent is $40 per week for a period of 12 months, namely a total of $2080. We make this assessment having regard to the following facts: 1. The agreed rental, for the property unaffected by mould is $320.00 per week or $16,640 per year; 2. The rented premises consisted of three bedrooms and one bathroom, all of which were affected by mould, as was the carpet; 3. No one room was unusable or had to be vacated; 4. There was evidence that the mould necessitated the appellant expending additional time in cleaning the premises, which she did herself. No doubt this was to avoid the cost of external cleaners and/or because she could not afford to do so. This would have reduced the time available to the appellant to otherwise occupy the house for purposes other than those associated with cleaning; 5. Similarly, the effect on her son and the time taken in looking after him meant that the benefits to be enjoyed from otherwise living in the residential premises was diminished. 6. On any view, the affected rooms were unsightly.
Finally, we note that the residential tenancy agreement has now come to an end and it has not been suggested that there has been any failure of the tenant to pay all rent due. Consequently, in addition to making an order to reduce the rent by a total of $2080, it is also appropriate for the Appeal Panel to make an order that the respondent pay this sum to the appellant.

Costs

During the hearing an issue arose as to late provision of the transcript by the respondent and the appellant's contention that costs were thrown away.
We note that it was always open to the appellant to provide as part of its evidence and submissions in chief a full transcript if it was thought necessary. Accordingly, it is difficult to see how any conduct of the respondent in responding to the appellant's evidence and submissions could have caused extra cost to the appellant. This is particularly so where the appellant had a copy of the sound recording to which the transcript related which it submitted as part of its submission in chief. Further, in these types of proceedings, an award of costs usually requires the cost applicant to show there were special circumstances justifying an award: see s60 of the NCAT Act.
Despite these observations, the issue of costs was reserved. Consequently, orders should be made to allow any application for costs to be made if that is still thought appropriate.

Orders

The Appeal Panel makes the following orders: 1. To the extent necessary, leave to appeal is granted and the appeal is allowed in part; 2. The order of the Tribunal made in application SH 16/07826 dismissing the claim for an order to reduce the rent under section 44 of the Residential Tenancies Act, 2010 is set aside and in lieu thereof the following orders are made: 1 The rent shall not exceed $280.00 per week as from 14 December 2014 until 13 December 2015. 2 The respondent is to pay the appellant the sum of $2080.00 by way of refund of rent, such amount to be paid immediately. 1. The appeal is otherwise dismissed. 2. Subject to order 5 below, each party is to pay their own costs of the appeal and of the proceedings at first instance. 3. Should either party seek a different order or orders as to costs than that set out in paragraph 4 above, any application for that order shall be made in accordance with the following directions. 1. Any application for costs is to be made by the filing and service of written submissions and any evidence within 7 days from the date these orders are published; 2. Any submissions and evidence in reply by the respondent to an application for costs are to be filed and served within 14 days from the date these orders are published; 3. Any submissions in reply by the applicant for costs in relation to the application for costs are to be filed and served within 21 days from the date these orders are published; 4. If the parties do not consent to an order that the Appeal Panel dispense with a hearing of any application for costs made under paragraph 5(1) above, the parties submissions are to include submissions on whether or not an order should be made dispensing with a hearing.

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: 16 January 2017

At a glance

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Judgment (16 paragraphs)

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Cases Cited (20)

Cited By (50)