Aid Co P, Sean Investments P, Meneling Station P, Property Developments P, Puco P
Catchwords
Randy River Health and Beauty Aid Co P/L t/as Middlerock Village Park v CTTT [2007] NSWSC 1142
Rathbone v Abel R v The Vestry of St Pancras R v The Vestry of St George's, Southwark (1887) 56 LJ QB 552
Perry v Wright (1908)1 KB 441 Minister for Immigration and Ethnic Affairs v Baker 45 ALD 136
Secretary Department of Defence v Fox (1997) 24 AAR 171
Source
Original judgment source is linked above.
Catchwords
Randy River Health and Beauty Aid Co P/L t/as Middlerock Village Park v CTTT [2007] NSWSC 1142Rathbone v Abel R v The Vestry of St Pancras R v The Vestry of St George's, Southwark (1887) 56 LJ QB 552Perry v Wright (1908)1 KB 441 Minister for Immigration and Ethnic Affairs v Baker 45 ALD 136Secretary Department of Defence v Fox (1997) 24 AAR 171Manns v Kennedy [2007] NSWCA 217Re Fogarty and Comcare [2007] AATA 2002Distilled Spirits Industry Case [2003] FCA 1139Pelka v Secretary of FACSIA [2008] FCAFC 92David v Minister for Immigration [2004] FCA 686R v HuntExparte Sean Investments P/L (1979) 180 CLR 322R v TooheyEx parte Meneling Station P/L (1982) 158 CLR 327 Strahan v RJ Sunseeker Property Developments P/L (1995)
Judgment (10 paragraphs)
[1]
REQUEST FOR WRITTEN REASONS
These formal written reasons are provided following a written request by the respondent tenant pursuant to the Civil and Administrative Tribunal Act 2013 (CATA) s 62 (Tribunal to give notice of decision and provide written reasons on request) which provides:
(1) The Tribunal (including when constituted as an Appeal Panel) is to ensure that each party to proceedings is given notice of any decision that it makes in the proceedings.
(2) Any party may, within 28 days of being given notice of a decision of the Tribunal, request the Tribunal to provide a written statement of reasons for its decision if a written statement of reasons has not already been provided to the party. The statement must be provided within 28 days after the request is made.
(3) A written statement of reasons for the purposes of this section must set out the following:
(a) the findings on material questions of fact, referring to the evidence or other material on which those findings were based,
(b) the Tribunal's understanding of the applicable law,
(c) the reasoning processes that lead the Tribunal to the conclusions it made.
(4) Nothing in this section prevents the Tribunal from giving oral reasons or a written statement of reasons for a decision it makes even if it has not been requested to do so by a party.
and see previously Consumer and Trader and Tenancy Tribunal Act (repealed) s 49 (Notice of decisions and reasons).
These written reasons are provided in addition to the brief oral reasons provided at the hearing: Kendell v BMW Finance Australia Pty Ltd: [1]
The meaning of a Tribunal 'decision' is widely defined, and is to be distinguished from reasons, which set out the reasoning process to explain the decision.
The decision was given on 24 November 2014 and is recorded in the written Notice of Order which took effect at that time. [2]
A party is entitled to know the decision and the reasons for the decision. Reasons are commonly given orally to the parties at the conclusion of the hearing, and no written reasons are usually provided, unless the parties request written reasons.
A statement of reasons can be brief, but must set out the decision and the reasons for the decision or any other material on which findings of fact are based.
Reasons should be adequate and comprehensive explaining the reasoning [3] being more than a statement of bare conclusions, [4] concise, [5] structured and logical but without being required to be survive a review "…construed minutely and finely with an eye keenly attuned to the perception of error", [6] and "…not to be scrutinised upon over-zealous judicial review by seeking to discern whether some inadequacy may be gleaned from the way in which the reasons are expressed". [7]
Written reasons need not be identical to the oral reasons, allowing for correction of grammar and punctuation, but they should not include any additional reasons which were not given orally, though they might be expressed differently without altering the substance. [8]
[2]
Application
This is an application by Mr Roland Rosenbach, a tenant, filed 30 October 2014 under the Residential Tenancies Act 2010 (RTA) seeking an order pursuant to s 44(1)(a) that a rent increase under an existing tenancy agreement is excessive and that from 1 January 2015 the rent for the residential premises must not exceed the current rent of $700.00 per week.
[3]
Appearances
Both parties appeared and the application was contested.
[4]
Jurisdiction
This Tribunal has jurisdiction under CATA ss 28, 29 and Schedule 4 (CONSUMER AND COMMERCIAL DIVISION ), Part 3 (Functions of Division), cl 3 (Functions allocated to Division); which by cl 3(1) includes the Residential Tenancies Act 2010, and by cl 3(2) provides:
(2) Subclause (1) extends to:
(a) any functions conferred or imposed on the Tribunal by statutory rules made under legislation referred to in that subclause, and
(b) any functions conferred or imposed on the Tribunal by or under this Act or enabling legislation in connection with the conduct or resolution of proceedings for the exercise of functions allocated by that subclause (including the making of ancillary and interlocutory decisions of the Tribunal).
The Tribunal has power to make orders under the RTA.
[5]
Facts
The material or relevant facts are set out in the exhibits as follows:
1. The tenancy agreement commenced 2 June 2012 at a rent of $700.00 per week payable in advance;
2. The premises are located at Potts Point and were built in 2001. The unit is unfurnished with one bedroom and a car space, being about 69 m2. The unit is located on the seventh floor in a high rise building with a pool, gym and concierge. The unchallenged evidence of Mr Rosenbach was that the unit appears to have its original fixtures and fittings and has not been refurbished since being built about 13 years previously. Mr Rosenbach gave unchallenged evidence that the carpet is worn with some water damage caused in July 2012 when the dishwasher failed and leaked; there are signs of peeling paint and cracks in plaster walls; worn blinds; a crack to the toilet bowl and wear and tear marks to cupboards and other fittings;
3. The premises are fitted with a dishwasher which broke down and was replaced by the landlord in 2012, albeit Mr Rosenbach says it was not of a comparable quality;
4. On 30 September 2014 the landlord respondent gave Mr Rosenbach written notice of a rent increase of $30.00 per week to $730.00 per week commencing on 1 January 2015, which is about 4%. This is the first rent increase since Mr Rosenbach occupied the premises, being some 30 months;
5. The Consumer Price Index (CPI) published on the Reserve Bank of Australia website (not in the party evidence) shows the CPI for June 2012 at 1.2%, June 2013 at 2.4%, and June 2014 at 3%;
6. Mr Rosenbach's evidence (exhibit A) of a current rental range for a similar size unit and car space was $705.00 to $795.00 per week, with those at the higher range renovated. Mr Rosenbach also provided evidence of lower rent in December 2012 of about $650.00 per week, which is not representative of the current rents, although it provided a comparison with the rent of $700.00 for Mr Rosenbach's unit which he was prepared to pay in December 2012.
In identifying the relevant facts for the decision and reasons I have been guided by the following principles:
1. Relevant or material facts are the facts essential to making the determination and which are the facts which the tribunal based its decision; [9]
2. Applied the test of "materiality": [10]
3. Considered the material or relevant facts on which the decision is made: [11]
4. The process involves identification of the factual elements in the relevant section of the statute which the applicant must prove to obtain a determination. This includes facts which are not controversial as they are not in dispute, and other facts which are in dispute. The Tribunal has to determine the disputed facts on the balance of probabilities, and the process involves weighing the evidence, and drawing conclusions or inferences; [12]
5. Include references in the reasons to the sources of the relevant evidence; [13]
6. Avoid errors of law or jurisdiction in giving reasons: [14]
7. It is not necessary to deal with or dispose of every fact that was not material to the determination. [15]
[6]
Contentions
Mr Rosenbach contends that the increase is excessive for the following reasons (in summary):
1. Current rental market is either overpriced (or at best fairly priced);
2. There is an apartment supply glut with numerous warnings of falling yields;
3. Landlords are having trouble maintaining (let alone increasing) rents;
4. There is no provision in the Agreement for an automatic rent increase;
5. Inflation is at its lowest level in decades;
6. The state of repair and general condition of the premises with its original fixtures and fittings showing significant signs of wear and tear.
The landlord contends that the increase is reasonable.
[7]
Law
A claim under RTA s 44(1)(a) must be brought within time, which in this matter is 30 days after notice of the increase is given: RTA s 44(2) and RTR clause 22(1). The Notice was received on 1 October 2014. This requirement is satisfied.
The relevant law concerning this matter appears in RTA s 44(1)(a) which relevantly provides:
(1) Excessive rent orders
The Tribunal may, on the application of a tenant, make any of the following orders:
(a) an order that a rent increase under an existing or proposed residential tenancy agreement is excessive and that, from a specified day, the rent for residential premises must not exceed a specified amount,
(b) …
(2) Time limit for excessive rent increase applications
An application for an order that a rent increase is excessive must be made within the period prescribed by the regulations after notice of the increase is given.
(3) ...
(4) Determination of excessive rent
For the purposes of making an order under this section, the Tribunal may declare that amounts payable under a contract, agreement or arrangement under which goods, services or facilities are provided to the tenant are rent.
(5) The Tribunal may have regard to the following in determining whether a rent increase or rent is excessive:
(a) the general market level of rents for comparable premises in the locality or a similar locality,
(b) the landlord's outgoings under the residential tenancy agreement or proposed agreement,
(c) any fittings, appliances or other goods, services or facilities provided with the residential premises,
(d) the state of repair of the residential premises,
(e) the accommodation and amenities provided in the residential premises,
(f) any work done to the residential premises by or on behalf of the tenant,
(g) when the last increase occurred,
(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).
(6) Effect of excessive rent order
An order by the Tribunal specifying a maximum amount of rent:
(a) has effect for the period (of not more than 12 months) specified by the Tribunal, and
(b) binds only the landlord and tenant under the residential tenancy agreement or proposed residential tenancy agreement under which the rent is payable.
The discretionary matters which the Tribunal is 'to have regard to' are set out in RTA s 44(5). Not all these factors are required to be considered: Davey v Murfin [1956] 73 WN NSW 222; Randy River Health and Beauty Aid Co P/L t/as Middlerock Village Park v CTTT [2007] NSWSC 1142; and the weight to be attached to each is a matter for the Tribunal in the circumstances of each case: see Rathbone v Abel 38 ALJR 293 per Barwick CJ at 295 referring to a wide discretion to be exercised judicially but without a requirement to adopt any particular method of determining the fair rent. The RTA does no more than provide a list of matters for consideration, and leaves it to the Tribunal to determine whether any or any particular weight should be given: R v The Vestry of St Pancras (1890) 4 QBD 371, at 376, overruling R v The Vestry of St George's, Southwark (1887) 56 LJ QB 552; Perry v Wright (1908)1 KB 441 at p 458. In more recent times Australian Courts have adopted the same approach: see Minister for Immigration and Ethnic Affairs v Baker 45 ALD 136; Secretary Department of Defence v Fox (1997) 24 AAR 171; Manns v Kennedy [2007] NSWCA 217; Re Fogarty and Comcare [2007] AATA 2002; Distilled Spirits Industry Case [2003] FCA 1139; Pelka v Secretary of FACSIA [2008] FCAFC 92; David v Minister for Immigration [2004] FCA 686); R v Hunt; Exparte Sean Investments P/L (1979) 180 CLR 322; R v Toohey; Exparte Meneling Station P/L (1982) 158 CLR 327.
I have considered a number of the matters:
1. the general market level of rents for comparable premises in the building, locality or a similar locality. The evidence is of a current rental range for a similar size and car space of $705.00 to $795.00 per week, some renovated;
2. there was no evidence of the landlord's outgoings;
3. the fittings, appliances and the services and facilities provided with the premises are extensive including a concierge, gym and pool;
4. the state of repair of the residential premises, which although showing wear and tear do not prove that the premises are in such a bad state to justify what is in effect an application for a rent freeze. Mr Rosenbach's evidence of some fixtures and fittings requiring repair is a matter to which RTA s 63 applies, and I infer in the absence of evidence of an application for work to be done by the landlord, that Mr Rosenbach does not have any real complaint about the state of the premises;
5. the accommodation is acceptable and there are extensive amenities provided including a car park, concierge, gym and pool;
6. there was no evidence of any work done to the residential premises by or on behalf of the tenant;
7. relevantly, the rent has not increased since commencement of the tenancy, although CPI has increased each year.
Other factors the Tribunal considers relevant RTA s 44(5) include the size, age, amenities and location of the premises: Strahan v RJ Sunseeker Property Developments P/L (1995); and
1. the length of the tenancy agreement, which has continued for some 30 months;
2. adherence to the terms of the agreement by both parties. There is no evidence of any breach by the landlord of his obligations;
3. the landlord's approach to repairs. There is no evidence that Mr Rosenbach has requested repairs which the landlord has refused to carry out, and to the contrary, the dishwasher was replaced.
[8]
Onus of proof
The tenant has the onus of proving under RTA s 44 that the rent is above the 'general level of rents for comparable properties': see Swinburne v Puco P/L (1995) NSWRT 86, similar to the matters in s 44(4) and although I am satisfied that the proposed rent increase is more than can be justified, I am not persuaded that Mr Rosenbach has proved that there should be no rent increase at all.
Taking all the evidence and matters into account I am satisfied there should be a rent increase of $20.00 per week to $720.00 per week, but that the rent is not to be increased for 12 months.
[9]
Conclusion
In all the circumstances and on the balance of probabilities it is just and appropriate to make the order.
J Levingston
General Member
Civil and Administrative Tribunal of New South Wales
9 December 2014
[10]
Endnotes
Kendell v BMW Finance Australia Pty Ltd (Unreported NSWDC 1114099/2010 Balla DCJ 25/11/10).
CATA s62(1) (Tribunal to give notice of decision and provide written reasons on request).
Wingfoot Australia Partners Pty Ltd v Kocak [2013] HCA 43 at [55].
Commonwealth v Pharmacy Guild of Australia (1989) 19 ALD 510 at 514 per Sheppard J.
Ansett Transport Industries (Operations) Pty Ltd v Wraith (1983) 48 ALR 500.
Minister for Immigration and Ethnic Affiars v Wu Shan Liang [1996] HCA 6; (1996) 185 CLR 259 at 272-273 at [30]; approving McAuliffe v Secretary, Department of Social Security [1993] FCA 456; (1993) 43 FCR 280 at 287, (1992) 28 ALD 609 at 616.
Minister for Immigration and Ethnic Affiars v Wu Shan Liang [1996] HCA 6; (1996) 185 CLR 259 at 272-273 at [31]; approving McAuliffe v Secretary, Department of Social Security[1993] FCA 456; (1993) 43 FCR 280 at 287 (1992) 28 ALD 609 at 616.
Spencer v Bamber [2012] NSWCA 274 per Campbell JA at [137] to [153]; Kendell v BMW Finance Australia Pty Ltd (Unreported NSWDC 1114099/2010 Balla DCJ 25/11/10).
Minister for Immigration and Multicultural Affairs v Yusuf [2001] HCA 30 at [136]; (2001) 206 CLR 323 at 346.
Singh [2000] FCA 845; (2000) 98 FCR 469 at 482 [56]- [57]; approved in Minister for Immigration and Multicultural Affairs v Yusuf [2001] HCA 30 at [137]; (2001) 206 CLR 323 at 346.
McEvoy v McEvoy [2012] NSWSC 1494 at [41] per Pembroke J; see also Minister for Immigration v Pochi (1980) 4 ALD 139 at 159-160.
Ansett Transport Industries (Operations) Pty Ltd v Taylor (1987) 18 FCR 498.
Minister for Immigration and Multicultural Affairs v Yusuf (2001) 206 CLR 323.
Craig v South Australia [1995] HCA 58; (1995) 184 CLR 163 at 179.
Re The Minister for Immigration and Multicultural Affairs; Ex parte Durairajasingham [2000] HCA 1; (2000) 168 ALR 407; (2000) 74 ALJR 405 at 417-418 per McHugh J.
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: 12 February 2015