Robinson v Fretin & Anor [2006] NSWSC 598 | Case summary

JUDGMENT 1 His Honour: At all relevant times, the Plaintiff and the First Defendant were parties to a Residential Tenancy Agreement. The First Defendant was the tenant. The Plaintiff was the Landlord. 2 During the term of the tenancy, the First Defendant made complaint concerning the hot water system (a complaint of leaking water). In December 2004, the Plaintiff employed a licensed plumber to attend to the problem (a new hot water system was installed). 3 On 15 March 2005, the new hot water service was found to be hanging partly off the wall on which it had been mounted and there had been flooding to the premises. This flooding brought about damage to the First Defendant. 4 Subsequently, the problem was rectified by another plumber. In an invoice from Parramatta Hot Water Service contained the following:- "Serviceman re installed Rheem 191/05007 LTR Electric Hot Water Service $280.00 that had fallen off the wall with new wall brackets looks like it was installed previously with only bottom bracket in place and with flex hoses with a strap around the front of the heater with wall plugs and screws DOM; 2004" 5 The First Defendant came to bring an application before the Consumer, Trader and Tenancy Tribunal (the "Tribunal") claiming compensation. The compensation sought included both economic and non-economic loss. The claim was founded on breaches of ss 22 and 25 of the Residential Tenancies Act 1987 (the "Act"). 6 The relevant provisions are as follows:- "22 Tenant's right to quiet enjoyment

7 The power to award compensation in such a case is conferred by s 16 of the Act it empowers the Tribunal to inter alia make an order as to compensation for any breach of the Residential Tenancy Agreement. 8 The application was heard by Tribunal Member Mr Carpentieri. The Tribunal Member came to the conclusion that the Plaintiff was in breach of both sections and made an order for compensation (in the sum of $6,057.95). 9 The written reasons for the decision contain the following:- "In the present case, there is no dispute and no evidence to the contrary that the hot water service as installed by the landlord's plumber failed, by reason of poor or inadequate installation and support, which consequently led to the damages to the premises and to the tenants' goods. There was no evidence or suggestion that the incident occurred otherwise. On the facts, I find that the damage occurred as a result of the support mechanism for the hot water service which was inadequate or failed as a result of poor installation or maintenance resulting in water leakage and flooding of the premises. I also find in this case that the landlord is responsible, either directly to the tenants or vicariously through the actions of the plumber, for breach of section 25(1) (b) for failure to maintain the residential premises in a reasonable state of repair. That breach led to the subsequent damages. As such, the tenant's are entitled to recover such damages that flowed from that breach which the tenants are capable of proving on the balance of probability to the satisfaction of the Tribunal. In relation to the alleged breach of section 22 of the Act, the tenants claim stress/loss of enjoyment ($2,000.00), aggravated illness ($1,000.00) and inconvenience ($2,000.00). Evidence was given that as a result of the flooding, the tenants were placed under considerable stress, inconvenience and difficulties. The tenants claim that this was as a result of breach of section 22. The Tribunal has held with some consistency that a breach of a section of the Act may give rise to an award of damages for the breach. In addition, damages of a less tangible nature which may flow from that breach may also be awarded. The secondary damages are usually awarded as a breach of section 16 of the Act, but not always, and usually for non-economic loss. In the present case, the tenant's claim a breach of quite enjoyment. The Tribunal agrees that a breach of section 25 by the landlord of her responsibilities has led to a breach of section 22. Again a breach of section 22 may give rise to an action for compensation under section 16. In either case, the tenants are entitled to an award of damages in respect of these 3 heads of damage of a less tangible nature which have been claimed. These are generally referred to as non-economic losses. 10 The Plaintiff has brought an appeal pursuant to s 67 of the Consumer, Trader and Tenancy Tribunal Act 2001 (the "Consumer Act"). An appeal lies under that provision where the Tribunal decides a question with respect to a matter of law. It is a narrow avenue of appeal. He bears the onus of satisfying the Court of an entitlement to relief. 11 The Plaintiff proceeded on an Amended Summons. This process propounds a number of grounds of appeal. Some relate to questions of liability. Others relate to questions of damage. 12 The hearing took place on 15 June 2006. The grounds of appeal relating to questions of damage were not formally abandoned but were not the subject of any submission. Counsel for the First Defendant made submissions on these matters. Those submissions did not excite any reply. 13 It was common ground that the appeal brought by the Plaintiff fell within the narrow ambit provided by s 67. 14 Broadly speaking, the submissions made by the parties focused on the proper construction of ss 22 and 25 of the Act. Counsel made submissions both in writing and orally. In the course of those submissions the Court was referred to a number of authorities. 15 Both the sections import a term into every Residential Tenancy Agreement. A claim for compensation made pursuant to either of them is founded on breach of contract. The compensation that is recoverable is restricted to that which flows from a breach of contract. 16 In the reasons for decision, the Tribunal did erroneously refer to the compensation being recoverable by reason of breach of the sections. This error is the subject of one of the grounds of appeal. There is no dispute that such error was made. However, there seems to be no dispute that the error is of no consequence in this case. 17 Another ground related to a finding that the Plaintiff had a vicarious liability through the actions of the plumber. Authority supports the view that the Plaintiff would not have had vicarious liability in the circumstances of this case. The evidence supports the view that the licensed plumber was an independent contractor. This did not seem to be in dispute. However, again, the error is of no consequence in this case. 18 There is authority in relation to covenants of quiet enjoyment which is relevant to the present case (Martin's Camera Corner Pty Limited v Hotel Mayfair Ltd (1976) 2 NSWLR 15). It supports the view that such a covenant operates not merely to secure possession for the tenant but also the enjoyment of the premises for all usual purposes and where the ordinary and lawful enjoyment of the demised premises is substantially interfered with by the acts or omissions of the Landlord. For there to be liability under the covenant, there must be present all the ingredients of a cause of action in tort for negligence. 19 The expression of reasoning process by the Tribunal Member that let him to come to the conclusion that there had been a breach of s 22 is unhelpful. It was somewhat unclear as to what was meant by the observation "The Tribunal agrees that a breach of s 25 by the Landlord of her responsibilities has led to a breach of s 22". If it was intended that a breach of s 25 was a prerequisite to the finding of a breach of s 22, the observation is erroneous. 20 A finding of negligence was not made against the Plaintiff. On the material that was before the Tribunal Member such a result could not have been reached. In the circumstances, the finding of breach of that section in the circumstances of this case would seem to be erroneous. 21 Counsel for the First Defendant made little effort to support this finding. Again, there seems to be a consensus that this error was of no consequence. It seemed to be common ground that the compensation that was the subject of the order could have been the subject of an order made pursuant to s 25. 22 I now proceed to consider the remaining liability question (which concerns breaches of s 25). Section 25 creates a contractual obligation. It is one that requires the Landlord to inter alia 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). 23 There is a consistent line of authority addressing the question of the proper construction of this provision. It includes a decision of a Judge of the District Court of South Australia and decisions by Tribunal Members. It supports the finding of breach made in this case. 24 Counsel for the Plaintiff has referred the Court to inter alia of Ridis v Strata Plan 10308 [2005] NSWCA 246 and Sakoua & Anor v Williams [2005] NSWCA 405. In my view, these cases are distinguishable from what has to be considered in this case. In Ridis, the Court of Appeal was dealing with the statutory duty of an Owner's Corporation in relation to common property. The imposed duty had differences in terminology. In Sakoua, the Court was dealing with the duty of an occupier to an entrant. 25 The contractual duty is not the same as the duty owed in tort for negligence. The language of the section does not introduce any qualification upon what is required to effect performance of the duty (it does not say that the Landlord should take reasonable steps or the like to maintain the premises). The provision is expressed in mandatory terms (shall maintain the premises in the requisite state of repair). 26 I am not satisfied that the Magistrate erred in deciding a quest with respect to a matter of law that justifies the disturbing of his decision. 27 It may be added that in the circumstances of this case, I consider also that it was reasonably open to the Tribunal Member to make a finding of breach. There were leakage problems. The installation of the new heating system in December 2004 did not rectify them. They were not rectified until March 2005. 28 There remains a consideration of the grounds relevant to the questions of damage. The stance taken by the Plaintiff leaves these grounds unsupported. There is authority for the proposition that compensation for non and economic loss can be awarded for pain and suffering, physical inconvenience, distress, anxiety and embarrassment (Port Shipping v Dillon (1992) 176 CLR 344). In the circumstances, these grounds must also fail.

Robinson v Fretin & Anor

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