This is an internal appeal from two decisions of the Consumer and Commercial Division of this Tribunal. There were two proceedings heard by the Tribunal. The first was RT 15/68344 in which the (three) tenants of a residential property in suburban Newcastle in NSW sought the return of their rental bond ("the Tenants' claim"). The second was RT 16/21348, in which the landlord of the same premises brought a claim for damages against the tenants for repair to the premises said to result from the occupation by the tenants ("the Landlord's claim") and unpaid rent.
The two matters were heard at the same time in Newcastle on 17 June 2016 and the decisions were also delivered that day (the Decisions).
This appeal is in respect of both proceedings. The landlord is Mr Russo and the tenants are the Respondents to the appeal. For clarity of expression, we will refer to the Appellant as "Mr Russo" and the Respondents as "the Tenants".
Mr Russo seeks to set aside the orders made by the Tribunal.
There is only a single ground argued in the appeal. Mr Russo alleges an error of law in that he was denied natural justice at the time of the Tribunal hearing.
[2]
The reasons below
The Tribunal below dismissed Mr Russo's claim because "The landlord left the hearing room without presenting his case. The landlord wishes to commence proceedings in the District Court of New South Wales". The Tribunal also delivered oral reasons, to similar effect.
In the Tenants' claim, the Tribunal held that the tenant was entitled to a refund of the rental bond of $1,670.00. The reasons of the Tribunal are set out below in full:
"The landlord, John Russo, attended the Tribunal at the commencement of hearing. He left the hearing room soon after the commencement of the hearing, without giving evidence in support of his claims on the rental bond.
The landlord indicated that he wished to pursue the matter in the District Court of New South Wales.
Prior to leaving the hearing room, the landlord was advised by the Tribunal member that if he left the hearing room without presenting his case, the tenant would be entitled to an order that the rental bond be returned to her.
The landlord chose not to give evidence to the Tribunal and walked out of the hearing.
The tenant, Kelly Brack, gave sworn evidence to the Tribunal in respect of the tenants claim for return of the rental bond.
The landlord has not established any breach of the residential tenancy agreement by the tenant on the balance of probabilities. The landlord has not established an entitlement to keep all or part of the rental bond.
The tenant is entitled to a refund of the rental bond."
No issue is taken with the fact that the reasons refer to "the tenant" while in fact there were three tenants of the property.
[3]
The Appeal hearing
Mr Davelaar, solicitor appeared for Mr Russo.
There was no appearance for the Tenants at the appeal hearing.
The Tribunal was satisfied that the Tenants had notice of the appeal hearing because there had been communication between the Tribunal and the Tenants just prior to the hearing, as follows:
1. On 5 October 2016 the Tenants applied (by email) to attend the Tribunal hearing by telephone. This application was refused and this was communicated to them (by email) on 6 October.
2. On the following day, Friday 7 October, the Tenants sought an adjournment. The Registry advised them that it was too late to consider the adjournment application and any such application should be made to the Appeal Panel on Monday 10 October 2016, when the matter was listed for hearing.
The Appeal Panel proceeded with the appeal in the absence of the Tenants because they had been given adequate notice of the hearing.
[4]
Application for an extension of time
Mr Russo said that the notice of appeal should have been filed by 15 July 2016. However, the date of the Decisions was 17 June and the Civil and Administrative Tribunal Rules 2014 (the Rules) provide that in the case of an internal appeal against a decision made in a residential proceeding, unless an extension of time is granted under s. 41 of the Civil and Administrative Tribunal Act, 2013 (the Act), the appeal must be filed within 14 days: r. 25(4)(b). The appeal was actually filed on 12 August 2016. Therefore, the appeal was filed approximately six weeks out of time.
Mr Russo provided an explanation for the delay in a document signed by him, dated 9 September 2016 and filed on 12 September 2016. At the appeal hearing, Mr Russo submitted the explanation in this document as his reasons for the delay.
Mr Russo says in that document, in summary, that after he received the reasons of the Tribunal below, he forwarded a letter of complaint to the registrar.
Mr Davelaar submitted that in writing his letter of complaint, Mr Russo believed he was taking the appropriate step to overturn the decision.
Mr Russo received a response to that letter from Mr Westgarth, a Deputy President of the Tribunal, in a letter dated 4 August 2016.
Mr Davelaar sought to tender Mr Westgarth's letter in evidence on the question of an extension of time. The Appeal Panel decided to admit this letter into evidence because it was referred to in the statement of Mr Russo dated 9 September 2016 and was significant on the question of an extension of time.
Mr Russo said that after receiving the letter from the Deputy President, Mr Russo then sought legal advice and the appeal was commenced promptly (within eight days) thereafter.
The Tenants did not attend the Appeal Panel hearing to advise the Tribunal whether they objected to an extension of time or had suffered any prejudice due to the delay, nor had they filed any submissions about it.
Given the lack of objection by the Respondents, the relatively short delay in filing the notice of appeal and the explanation provided by Mr Russo, the Appeal Panel decided to consider whether Mr Russo had reasonable prospects of success, before deciding the question of an extension of time under s. 41 of the Act.
[5]
The Grounds of Appeal
Mr Russo said that the decision below should be overturned because he was denied natural justice. Mr Russo's argument was that
1. the Tribunal member had neglected or refused to read material which he had filed, before deciding the matter, or
2. alternately characterised the error by the Tribunal below as a failure to tell Mr Russo that his material would be read and taken into account in due course.
Mr Davelaar submitted that Mr Russo walking out of the Tribunal hearing below came about in the following manner
1. Mr Russo had filed a substantial amount (almost 100 pages) of material including photographs, quotes, statements and references.
2. Ms Moss was the Tribunal Member assigned to hear the matter. When she came on the bench, she told Mr Russo that she had not read the material because she was assigned to hear the matter only a matter of minutes before commencement of the Tribunal hearing.
3. Mr Russo took exception to this, believing that the material should have been read in advance. Mr Russo became emotional and accused the Tribunal of "blackmail" and "bias". He left the hearing a short time later.
The Appeal Panel listened to the recording of the Tribunal hearing below. Unfortunately, a portion of it was not clear due to a technical error. There was no transcript of it available to the Appeal Panel.
However, from the recording the Appeal Panel determined that Mr Davelaar's description of events is reasonably accurate. But by way of addition to that description the Appeal Panel determined that the following occurred at the hearing below:
1. Mr Russo had no difficulty expressing himself in the English language.
2. A lively exchange occurred between Mr Russo and Ms Moss.
3. Ms Moss repeatedly said that Mr Russo's written material would be read (thus eliminating the second characterisation of error above namely a failure to tell Mr Russo that his material would be read and taken into account in due course).
4. Mr Russo accused the Tribunal of bias and said he might withdraw his application to pursue it "in the District Court"
5. Mr Russo asked Ms Moss to remove herself from the bench. The Appeal Panel understood this to be an application to recuse herself for bias.
6. Ms Moss refused to recuse herself and stated that she proposed to go ahead with the hearing. That was after giving Mr Russo three options, to seek an adjournment to obtain legal advice, to withdraw his application to pursue it in the District Court or to have the matter heard and determined that day.
7. After Ms Moss said she proposed to go ahead with the hearing, Mr Russo was heard to say "I'm going to walk out" and the recording notes that he does so a short time later.
The Appeal Panel's understanding of the recording is supported by the letter from Mr Westgarth who said at page 2.5:
"…the recording shows Ms Moss offered you the options of proceeding to hearing with you giving your evidence, adjourning the matters for you to seek legal advice, or withdrawing your application to pursue your claim at the NSW District Court. Ms Moss noted the result of a withdrawal would be that the tenants would be entitled to a refund of the bond in the interim period. When you left the hearing room Ms Moss proceeded to hear the tenant's claim and make an order."
The inference the Appeal Panel draws from that part of the letter is that Mr Westgarth must have listened to the recording and interpreted events in the same way as the Appeal Panel.
There was no dispute by Mr Russo about the accuracy of what was recorded in that part of the letter.
In the brief written reasons given by the Member in the Landlord's claim, detailed above, the Member did not state the basis on which the Landlord's claim was disposed of. It is reasonable to infer that the Tribunal dismissed the proceedings because Mr Russo withdrew his application, pursuant to s. 55(1)(a) of the Act. This seems the most likely basis as the brief reasons stated above refer to him wishing to pursue his claim in the District Court.
The other sub-paragraphs of s. 55(1) would not apply in the circumstances. Section 55(1)(b) (frivolous or vexatious) or s.55(1)(c) (failed to appear) would be inappropriate while s.55(1)(d) (want of prosecution) was not stated as a basis.
The Appeal Panel characterises the issue as whether the Tribunal failed to provide procedural fairness to Mr Russo in accepting that he had withdrawn his claim by leaving the hearing room after the exchanges recorded above.
It is accepted that the Member did not read his evidence or consider his written submissions when determining his claim in that way.
Mr Davelaar submitted that Mr Russo believed he had put matters before the Tribunal in the 100 pages of material filed and that the Tribunal should have taken it into account. He was seeking a re-hearing so he could rely on that material in defending the claim by the tenants and to pursue his claims against them.
The Appeal Panel was told that Mr Russo believed he had been denied procedural fairness because his filed material was not read.
Mr Russo did not dispute the matters recorded in the written reasons of the Member below nor did Mr Russo did seek to raise the issue of "bias" or "blackmail" as a part of the appeal.
[6]
The applicable law
In Allesch v Maunz (2000) 203 CLR 172 Kirby J [35] said:
"It is a principle of justice that a decision-maker, at least one exercising public power, must ordinarily afford a person whose interests may be adversely affected by a decision an opportunity to present material information and submissions relevant to such a decision before it is made. The principle lies deep in the common law….
These principles apply to the Tribunal. In Raslan v Pan [2015] NSWCATAP 12 at [26] the Appeal Panel said:
"[26] The Tribunal is required to ensure that the parties have an opportunity to be heard, and to apply the rules of natural justice or procedural fairness, pursuant to s 38(2) and 38(5)(c) of the NCAT Act."
The relevant parts of s 38 of the Act are:
2) The Tribunal is not bound by the rules of evidence and may inquire into and inform itself on any matter in such manner as it thinks fit, subject to the rules of natural justice.
..
(5) The Tribunal is to take such measures as are reasonably practicable:
(a) ..
(b) ..
(c) to ensure that the parties have a reasonable opportunity to be heard or otherwise have their submissions considered in the proceedings.
In this matter, s 38 (6)(b) of the Act is also relevant
(6) The Tribunal:
(a) ..
(b) may require evidence or argument to be presented orally or in writing, and
(c) ..
It is accepted that the Tribunal below did not take into account the evidence filed by Mr Russo in reaching its decision. The question in the present matter is whether, in failing to do so, the Tribunal afforded Mr Russo an opportunity to present his case.
The Appeal Panel accepts that the member below did not read the material filed by the landlord before the hearing commenced. However, this is not unusual and does not constitute a breach of natural justice. Natural justice or procedural fairness does not require the Tribunal to read any particular material before the commencement of the hearing.
Further, the member was entitled pursuant to s. 38(6)(b) to require Mr Russo to present his case orally.
After listening carefully to the recording of proceedings below, the Appeal Panel is of the opinion that the Learned Member was entitled to accept, that by leaving the hearing room after the above exchanges, Mr Russo had withdrawn or abandoned his claim.
The Appeal Panel determines that the fact that the Mr Russo left the hearing room does not constitute a denial of procedural fairness or breach of natural justice in this case because, as Kirby J said in Allesch, supra, at [39]
"Decision-makers, including the courts, cannot generally force people to protect their own rights, to adduce evidence or other materials, to present submissions or to act rationally in their own best interests."
The Tribunal afforded Mr Russo an opportunity to present his case. It may not have been in the manner that Mr Russo preferred, but he was given the opportunity to do so; and that is all the Tribunal was required to do to satisfy the demands of procedural fairness or natural justice. This is not a case where the opportunity offered was not able to be availed of, for instance where the party is, through no fault of their own, unable to attend the hearing, such as where they are unwell: cf Waters v Waghorn [2016] NSWCATAP 247 where there was persuasive evidence that the appellant had been unfit and unwell at the date of the hearing. Here, Mr Russo made a decision to withdraw his claim.
The Tribunal must have control over proceedings before it, if it is to satisfy the guiding principle in s 36(1) of the Act to facilitate the just, quick and cheap resolution of the real issues.
So far as the appeal relates to the Landlord's claim there is no error demonstrated. The Tribunal did not err in treating Mr Russo's application (the Landlord's claim) as withdrawn.
Ms Moss went on to consider the Tenants' claim in the absence of Mr Russo. In accordance with Tribunal procedures, the Tenants' claim for the return of the bond had been the subject of its own application. Section s 157 of the Residential Tenancies Act, 2010 defines a "rental bond" to be a "security" and it follows that unless a legitimate claim is otherwise established, it remains the property of the tenant who provided the security. A landlord may bring a claim under s. 166 of the Residential Tenancies Act, under which the landlord carries the burden to prove his entitlement. A myriad of decisions in this Tribunal (and its precursor, the Consumer, Trader & Tenancy Tribunal) have followed this course: see for instance Kenny v Beevers (Tenancy) [2011] NSWCTTT 133 at [5]; Nicholas v Miernik (Tenancy) [2011] NSWCTTT 293 at p3; Volfneuk v McCardle (Tenancy) [2002] NSWCTTT 460 at p 4; Bhikkhu v Colvin Family Superannuation Fund [2016] NSWCATCD 29 at [13], to name a few. The Appeal Panel in Pearson v Clark [2016] NSWCATAP 134 at [85], described a landlord's claim for rent unpaid as follows:
"While in one sense this claim may be seen as a "defence" to the bond proceedings, properly seen it is a separate cause of action for which the appellants were entitled to bring separate proceedings."
Mr Russo's material was not relevant to the Tenants' claim: his claim on the bond having been withdrawn when he withdrew his application. The Tenants' claim was restricted to the issue of the return of the bond and the Tribunal did not err in determining it without having regard to the material filed in support of the Landlord's withdrawn claim.
In conclusion, the Tribunal is not satisfied that Mr Russo was denied a reasonable opportunity to present his case.
The Appeal Panel finds that Mr Russo does not have reasonable prospects of success in the appeal. Accordingly, an extension of time to commence proceedings, is refused.
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
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Decision last updated: 01 December 2016