Shepley v Robinson

The Appeal

1. In his appeal the landlord listed a number of grounds of appeal. The first was that the Member acted unfairly, allowed the tenant to interrupt him and allowed the tenant to introduce new evidence at the hearing but he was refused the same opportunity. The other grounds were that the Member erred in finding: 1. that the tenant was not responsible for the payment of water and electricity charges for the period 13 October 2018 to 10 June 2019 as the Member was not satisfied that the premises were separately metered; 2. that the premises were left reasonably clean by the tenant having regard to the condition of the premises at the beginning of the tenancy and the landlord was therefore not entitled to costs of cleaning; 3. that damage to the timber floor at the entrance to the premises was fair wear and tear; 4. that the oven was at the end of its serviceable life and the cost of replacing and installing a new oven was not the responsibility of the tenant; 5. that, as the landlord did the work himself, he could not claim the cost of repositioning and recalibrating a sensor light moved by the tenant; 6. that the tenant was not responsible for damage to the kitchen floor; and 7. that the tenant had vacated the premises at the end of the fixed term and was not responsible for lost rent.
2. At the hearing before the Tribunal Member the landlord also claimed a sum of $180 for drying out and reorganising documents provided to him by the tenant in accordance with the Tribunal's directions as the tenant left them on the front lawn where they got wet from rain. That claim was rejected by the Member and the landlord also includes that as a ground of appeal.
3. In relation to all grounds of appeal the landlord states that he seeks leave to appeal as he has suffered a substantial miscarriage of justice.
4. The landlord also seeks his costs of the appeal.
5. The tenant did not reply to the notice of appeal and did not attend the appeal hearing, despite being served with a notice.

Applicable legal principles - internal appeals

1. Section 80(2)(b) of the Civil and Administrative Tribunal Act 2013 (the NCAT Act) states: Any internal appeal may be made: (a) in the case of an interlocutory decision of the Tribunal at first instance - with the leave of the Appeal Panel, and (b) in the case of any other kind of decision (including an ancillary decision) of the Tribunal at first instance - as of right on any question of law, or with the leave of the Appeal Panel, on any other grounds.
2. Clause 12 of Schedule 4 to the NCAT Act states with respect to decisions made in the Consumer and Commercial Division that: An Appeal Panel may grant leave under section 80 (2) (b) of this Act for an internal appeal against a Division decision only if the Appeal Panel is satisfied the appellant may have suffered a substantial miscarriage of justice because: (a) the decision of the Tribunal under appeal was not fair and equitable, or (b) the decision of the Tribunal under appeal was against the weight of evidence, or (c) significant new evidence has arisen (being evidence that was not reasonably available at the time the proceedings under appeal were being dealt with).
3. In the present appeal the landlord is not legally represented and it is appropriate for the Tribunal to determine, looking at the grounds of appeal generally, whether a question of law has in fact been raised, subject to any procedural fairness considerations in favour of the respondent: Prendergast v Western Murray Irrigation Ltd [2014] NSWCATAP 69 at [12]; Cominos v Di Rico [2016] NSWCATAP 5 [13].
4. In Prendergast at [13], the Appeal Panel said that the following are errors of law: 1. whether the Tribunal provided adequate reasons, which explain the Tribunal's findings of fact and how the Tribunal's ultimate conclusion is based on those findings of fact and relevant legal principle; 2. whether the Tribunal identified the wrong issue or asked the wrong question; 3. whether it applied a wrong principle of law; 4. whether there was a failure to afford procedural fairness; 5. whether the Tribunal failed to take into account a relevant (that is, a mandatory) consideration; 6. whether it took into account an irrelevant consideration; 7. whether there was no evidence to support a finding of fact; and 8. whether the decision was legally unreasonable.
5. In his first ground of appeal the landlord states that he was denied the same opportunity as the tenant to put his case before the Tribunal. In effect, the landlord is claiming that he was denied procedural fairness, which, if substantiated, may amount to an error of law.
6. In relation to the other grounds of appeal the landlord seeks leave to appeal on the grounds the Tribunal's decision was not fair or equitable and was against the weight of the evidence. He also states that significant new evidence is available that was not reasonably available at the time of the hearing. These grounds accurately reflect the terms of cl 12(1) of Schedule 4 of the NCAT Act pursuant to which leave to appeal on grounds not raising a question of law may be sought.
7. Obtaining leave to appeal is a two-stage process. At the first stage the landlord must persuade us that he may have suffered a substantial miscarriage of justice under clause 2 of Schedule 4, because of one or more of the matters referred to in his grounds (a) to (g). Should he persuade us that he may have suffered a substantial miscarriage of justice he must then, at the second stage, persuade us that we should exercise our discretion to grant leave to appeal on one or more of those grounds. The principles applicable to the granting of leave were set out in Collins v Urban [2014] NSWCATAP 17 at [65] - [84].
8. For the reasons which appear below we are not satisfied that the landlord was denied procedural fairness, nor are we persuaded that the landlord has satisfied either stage one or stage two of the relevant test in relation to grounds (a) - (d) and (f)) or the additional ground set out in paragraph 9 above.
9. In relation to ground (g), although not characterised before us as such, we have found that the Tribunal failed to identify and apply the correct principle of law and therefore fell into legal error. We have also found that the Member erred in not allowing an amount for repair of the sensor (item (e) above). We are therefore satisfied that the landlord may have suffered a substantial miscarriage of justice because the decision of the Tribunal was against the weight of the evidence. In those circumstances we grant leave to appeal and we allow the appeal in relation to that item.
10. It is convenient to deal with the new evidence and procedural fairness grounds first and then to turn to the other grounds of appeal.

New evidence

1. In the appeal the landlord sought to rely upon various pieces of additional evidence. The first of these concerned evidence which had not been admitted at the Tribunal hearing. The landlord, in accordance with directions made by the Tribunal had filed a bundle of documents with the Tribunal on 2 August 2019. The tenant had filed and served his documents on 29 August 2019. At the hearing the landlord sought to rely upon additional material which had not been filed with the Tribunal or served on the tenant. The evidence comprised things such as emails and bank statements. The Tribunal Member refused to allow the evidence to be adduced at the hearing on the basis that it should have been supplied in accordance with the previous directions of the Tribunal. The landlord then sought to rely on this evidence at the appeal hearing.
2. This additional evidence sought to be relied upon at the appeal hearing was therefore not in fact new evidence but had been evidence that the landlord had failed to file and sought to rely upon during the Tribunal hearing but had not been admitted by the Member. Leave will not be granted to admit this additional evidence on the appeal as it was reasonably available to the landlord at the time of the initial hearing and should have been filed in accordance with the Tribunal's directions.
3. The landlord also raises the refusal by the Member to admit this additional evidence at the Tribunal hearing as an instance in which he was denied procedural fairness. This is dealt with below.
4. At the hearing of the appeal the landlord also sought to rely on two new reports from builders about the damage to the floating floor in the kitchen of the premises. These reports were obtained after the Tribunal made its decision. These reports were therefore not before the Tribunal Member and indeed the landlord had not provided any expert reports in relation to the flooring prior to the Tribunal hearing. The landlord told us that he obtained the reports to rebut the members findings on this issue. He said he had not previously obtained the reports because he did not think that he had to.
5. The landlord provided extensive evidence to the Tribunal. In general, a party is bound by the manner in which it conducted its own case and there is nothing before us to suggest that the new evidence now sought to be relied upon could not have been obtained at an earlier point in time. We are not persuaded that the reports were unavailable because "no person could have reasonably obtained the evidence": A Daouk v Mr Pine Pty Ltd t/as Furnco Bankstown [2015] NSWCATAP 111 at [23]. We therefore find that the new evidence was reasonably available at the time of the hearing and decline to admit it in the appeal.

Denial of procedural fairness

1. The landlord states that he was treated unfairly as the tenant was repeatedly permitted to interrupt him and the Member gave the tenant opportunities to provide new evidence during the hearing but he was denied the same.
2. The transcript of the hearing provided by the landlord demonstrates an acrimonious relationship between the landlord and tenant. The tenant repeatedly interjected while the landlord was speaking. The Member made many attempts to control the conduct of the hearing to the best of his ability. The landlord, who bore the onus of proof in relation to the items claimed, was given every opportunity to put forward his case, including making a final statement at the conclusion of the hearing and was asked relevant questions by the Member. We are not satisfied that the landlord was placed at a disadvantage or was denied an opportunity to speak or present his case.
3. The landlord's reference to being treated differently by the Member in relation to adducing new evidence at the hearing appears to concern two instances. In these instances the landlord states that the tenant was able to put forward evidence that had not previously been filed but in similar circumstances he was denied that opportunity.
4. The first instance concerned the tenant's disagreement that any rent arrears were owed to the landlord. The landlord provided a spreadsheet of rent payments made up to the time the tenant left the premises. The Member provided the tenant with an opportunity during the course of the hearing to go through the spreadsheet and to substantiate his claim that the rent had been paid. A reading of the transcript shows that the Member himself raised concerns about the accuracy of the landlord's rent ledger prior to allowing a short adjournment for the tenant to respond. Ultimately the Member accepted the evidence of the landlord and ordered the tenant to pay the arrears in rent. Again, in the circumstances, we are not satisfied that the Tribunal was procedurally unfair or that the conduct complained of resulted in an outcome adverse to the landlord.
5. The second instance relates to the landlord's claim that the tenant was liable for damage to a section of the floating floor in the kitchen. The landlord claimed an amount of $1075 to repair damage to the floor which he alleged was caused by water leaking from the tenant's refrigerator. The tenant disputed the claim and at the hearing produced a photograph of a new refrigerator which he said that he purchased at the start of the tenancy. He told the Tribunal Member that the refrigerator did not leak water and that the marks on the floor in the refrigerator cavity were fair wear and tear. The Member refers to the photograph and the statements of the tenant in his reasons for decision. The landlord states that he was treated unfairly as the Member accepted the evidence of the tenant at the hearing.
6. The reasons for decision and statements made by the Member at the hearing demonstrate that the decision was not based on the evidence of the tenant given at the hearing, including the photograph of the refrigerator. As was pointed out to the landlord by the Member at the hearing, he had not provided any independent evidence to show the cause of the damage to the floor. In those circumstances, he found the landlord had not proven that the damage was caused by the tenant. As the landlord bore the onus of proof to establish that the damage was caused by the tenant, we can find no unfairness in the actions of the Member and note that both parties were permitted to give oral evidence at the hearing.

Utilities

1. At the time the residential tenancy agreement was entered into the premises occupied by the tenant were not separately metered for water and electricity. The landlord states that metres were later installed and from 13 October 2018 the tenant was responsible for the payment of water and electricity charges. The Tribunal Member was not satisfied that the premises were separately metered, that the tenant received proper notice or had any responsibility for the payment of these charges. He therefore dismissed the claim.
2. The landlord submits, in effect, that the Member's decision was against the weight of the evidence. The expression "against the weight of evidence" in the Tribunal means that the evidence in its totality preponderates so strongly against the conclusion favoured by the Tribunal that it can be said that the conclusion was not one that a reasonable Tribunal member could reach: Calin v Greater Union Organisation Pty Ltd (1991) 173 CLR 33; [1991] HCA 23 at [153], followed in Collins v Urban at [77].
3. A tenant is required to pay all charges for the supply of electricity to the tenant at the residential premises if the premises are separately metered (s 38 Residential Tenancies Act 2010). A tenant must also pay water usage charges but only in certain circumstances (s 39). These include that the premises are separately metered, that they contain water efficiency measures, the charges do not exceed the amount payable by the landlord for water used by the tenant and the tenant is given a copy of the water supply authority's bill setting out the charges or other evidence of the cost of the water used by the tenant.
4. It appears from the evidence submitted by the landlord to the Tribunal that the meters that were installed were sub-meters attached to the original meter. The landlord would read the sub-meter and apply the supply company's standard rate to calculate the charges payable by the tenant for either water or electricity. The tenant was not given a copy of bills from the electricity or water suppliers. There was no evidence before the Member of the amounts actually charged to the landlord by the suppliers in relation to each bill, including the actual rates and whether any discounts were applied. There was also no evidence of water-saving devices being installed in the rented premises.
5. The Member determined, in light of the evidence before him, that the tenant was not responsible for the payment of electricity and water charges. There was no error of law in his so finding and nor can it be said that the finding was not just or equitable or was against the weight of the evidence.

Cleaning and claims of damage

1. At the end of the residential tenancy, tenants must leave the residential premises as nearly as possible in the same condition, fair wear and tear excepted, and, if there is a condition report, as set out in the condition report applicable to the premises, when the agreement was entered into (s 51(3)(b) of the Residential Tenancies Act). The Tribunal must assess the state of repair and general condition of the premises at the commencement and conclusion of the tenancy. Any condition report at the commencement and end of the residential tenancy will be relevant to this task. If the tenant has intentionally or negligently caused damage or the wear and tear is not "fair", the tenant is liable to compensate the landlord for the cost of repairs.
2. Similarly, a tenant must leave the residential premises in a reasonable state of cleanliness, having regard to the condition of the premises at the commencement of the tenancy (s 51(3)(c) of the Residential Tenancies Act).
3. At the hearing before the Member the landlord sought to rely upon ingoing and outgoing condition reports. Condition reports are dealt with in sections 29 and 30 of the Residential Tenancies Act. The Member noted that the ingoing condition report provided by the landlord, which he stated had been prepared by the managing agent he had at the time, was unsigned. The tenant stated at the hearing that he had no recollection of receiving the report or being requested to make any comment upon it. The outgoing condition report was prepared by the landlord in the absence of the tenant and there is no evidence that he was given an opportunity to be present as required by s 29(5) of the Residential Tenancies Act.
4. In general, the Member placed little reliance on the condition reports and, in the circumstances, was entitled to do so.

Cleaning

1. The evidence given by the landlord at the hearing was that on 25 May 2019, prior to the departure of the tenant from the premises, he obtained a quote from Jim's Cleaning to clean the premises. According to the landlord, Jim's Cleaning had cleaned the premises at the end of the previous tenancy and he sent them photographs of the premises to obtain a quote to clean them again. Jim's Cleaning provided a quote of $440 for " vacate cleaning". Jim's Cleaning did not inspect the premises after the tenant vacated and the landlord subsequently paid $440 to some of his relatives who cleaned the premises. No invoice for that amount was provided.
2. Both parties provided photographs of the premises taken when the tenant vacated them. On the evidence before him the Member was satisfied that the premises were left reasonably clean by the tenant.
3. The amount claimed by the landlord for cleaning the premises was an amount paid to his relatives based on a quote provided by a contractor who did not see the premises after the tenant vacated. The quote was not referable to the point in time, that is, the end of the tenancy, at which an assessment could be made as to whether the premises were left reasonably clean by the tenant, having regard to the condition of the premises at the commencement of the tenancy. The Member was correct in not allowing the landlord to rely upon the quote as evidence of the condition of the premises as it was no more than a general quote for cleaning premises at the end of a tenancy.
4. The Member's decision in relation to the cleanliness of the premises was based upon the other evidence before him, including photographs provided by both the landlord and the tenant. The members finding that the premises were left reasonably clean by the tenant was reasonably open based on the evidence and after a contested hearing. The fact that the landlord does not agree with this finding is not a sufficient basis to conclude that the finding was not just or equitable or was against the weight of the evidence.

Entrance timber decking, oven, kitchen floor

1. The landlord claimed an amount of $275 to sand and re-stain timber decking at the entrance to the premises. Photographs provided by the landlord show marks to one section of the decking which the landlord claims were burn marks. The tenant denied responsibility for the damage. The Member found that the change in the condition in the timber decking was fair wear and tear which had arisen from normal everyday use. The landlord sought to reargue the issue before the Appeal Panel.
2. As has been previously stated the onus was on the landlord to prove on the balance of probabilities that the tenant had breached his obligations regarding the condition of the property at the end of the tenancy and, if so, the loss that flowed from the breach. The task of the Tribunal was to assess all of the evidence and form its own view including, relevantly, whether any damage was fair wear and tear: Elhassan v Ayoub [2018] NSWCATAP 34 at [6] and [13].
3. We are not satisfied that any error has been established in the manner in which the Member considered the evidence. The mere fact that the landlord disagrees with the outcome is not sufficient to establish any error. In our view the findings made by the Member were reasonably available on the evidence put forward by both parties at the hearing.
4. Similar considerations arise in relation to the landlord's claim for the cost of replacing and installing a new oven. Both the landlord and the tenant presented evidence about the condition of the oven. There was no dispute that the oven was more than 10 years old and that the premises had been rented since about 2010. There was also no dispute that the tenant had complained to the managing agent a few months after the commencement of the tenancy that the oven needed repair. The landlord himself carried out the repair in about August 2018 by replacing a hinge on the oven door. The tenant again complained to the agent about the oven in December 2018 as the oven glass had broken.
5. The Member found that the oven was not in particularly good condition, was at the end of its serviceable life and was probably due for replacement in any event and therefore disallowed the claim.
6. Again, the landlord disputes the outcome. In our view, however, given the age of the oven and the evidence presented, it was reasonably open to the member to conclude that the oven was at the end of its serviceable life. We can see no error in the member's conclusions.
7. In relation to the timber flooring in the kitchen in the refrigerator cavity, as noted above, the Member found that in the absence of any independent evidence as to how or why there was damage to the floor, the landlord had not proven this claim. As also noted above, at the appeal hearing the landlord sought to provide new evidence in response to the findings of the Member. As we have stated previously, the evidence now sought to be provided is not new evidence within the meaning of the Act and does not provide a basis upon which we may grant leave to appeal.

Sensor light

1. The tenant did not dispute that he moved the sensor which controls the security light. The landlord provided a quote for $84.70 from a licensed electrician to move and recalibrate the sensor. The Member's finding was that, as the landlord, who is a licensed electrician, carried out the repair himself, there was no basis upon which he could claim the estimated cost of repair and he disallowed this claim.
2. In circumstances where the tenant admitted to moving the sensor, the landlord is entitled to the reasonable cost of restoring it to its original position so it can operate as intended. The landlord obtained a quote to carry out the necessary work and the fact that he, as a licenced electrician, carried out the work himself, does not mean is not entitled to recover the cost. In our view the Member erred in finding otherwise and the decision was against the weight of the evidence.

Lost rent

1. The landlord sought compensation (lost rent) from the tenant for failing to give proper notice to end the tenancy plus loss of rent whilst tradespersons were carrying out repairs. The Member dismissed the landlord's claim on the basis that there was no evidence before the Tribunal as to the time the tradespersons took to undertake the repairs or that there were any prospective tenants who were ready to move into the premises. The Tribunal also noted that the tenant vacated the premises at the end of the fixed term.
2. The Member accepted that the tenant vacated the premises on 6 June 2019. There was no dispute that he did not hand the keys to the landlord on that day but left them in the letterbox. The landlord's evidence was that he became aware that the tenant had left the premises when he found the keys in the letterbox on 10 June 2020. That evidence was accepted by the Member and he allowed the landlord rent up to 10 June 2020 when dealing with the item on rent arrears.
3. Any entitlement of the landlord to compensation at the end of the tenancy is dependent on how the tenancy is terminated. The Residential Tenancies Act provides for the way in which a tenancy ends. In relation to termination at the end of the fixed term, either the tenant or the landlord can give notice of termination of the fixed term agreement to take effect on or after the end of the fixed term. The fixed term ended on 5 June 2020 and there was no evidence before the Member that either party gave notice to end the agreement on that or a later date. The Member referred to three termination notices which the landlord had served on the tenant. Those termination notices were not notices to vacate at the end of the fixed term (the last requiring vacant possession on 9 April 2019) and were irrelevant to the Member's consideration of the issue.
4. On the basis of the evidence before the Member it is apparent that the tenant did not vacate at the end of the fixed term either by way of a correct notice or in fact. The Member's conclusion that the tenant vacated at the end of the fixed term was not supported by the evidence before him. Somewhat confusingly the Member in his reasons for decision also referred to the principles relevant to a consideration of the landlord's remedies on abandonment, even though he also intimated that the tenant vacated at the end of the fixed term.
5. In our view the Member failed to apply the relevant provisions of the Residential Tenancies Act to make an essential finding as to how the tenancy terminated. Such a finding was a prerequisite to any consideration of whether the landlord was entitled to any compensation as a result of the way in which the tenancy was terminated. A failure to apply the correct legal principles is an error of law.

Claim for drying documents

1. The landlord also claimed a sum of $180 for drying out and reorganising documents provided to him by the tenant which had gotten wet. The Member rejected this claim and, in our view, was right to do so. The claim was by way of a claim for costs and no special circumstances existed to justify the award of costs (s 60 NCAT Act).

Disposition of the appeal

1. On most grounds the landlord has failed in his appeal. We have, however, found that the Member erred in his consideration of the claims for repair of the sensor and compensation for loss at the end of the tenancy. Rather than remitting the determination of the landlord's claim to the Tribunal, we have decided to determine that claim (s 80(3) NCAT Act).
2. The fixed term tenancy ended on 5 June 2019. There is no dispute that the tenant did not vacate on that date or give notice of his intention to end the tenancy. He could have done so under s 84 which provides for notice to given before the end of the fixed term of a fixed term agreement, which is to take effect on or after the end of the fixed term A fixed term agreement that continues after the end of the fixed term becomes a periodic tenancy (s 18 Residential Tenancies Act). From 6 June 2019 therefore, the tenancy continued as a periodic tenancy on the same terms as the fixed term agreement. In our view, the tenant abandoned the premises when he left on 6 June 2019 (s 106 Residential Tenancies Act) and the landlord became aware of the abandonment on 10 June 2019 when he found the keys in the letterbox. The landlord is therefore entitled to compensation for any loss resulting from the abandonment, but has a duty to mitigate (s 107 Residential Tenancies Act).
3. The issue is whether the landlord was entitled to any compensation for loss of rent beyond 10 June 2020 (the Member having awarded rent arrears to that date). It was accepted by the Member that the landlord carried out certain repairs to the property. The Member noted in his decision that there was no evidence as to when repairs were carried out and there was no evidence that there were any tenants who were ready to move into the premises.
4. At the hearing of the appeal, the landlord conceded that he had not provided evidence of the time taken for repairs. A new tenancy commenced on 5 July 2019.
5. The landlord does not appear to have acted unreasonably in the time taken to organise repairs and obtain a new tenant for the premises (see Karacominakis v Big Country Developments Pty Ltd [2000] NSWCA 313 at [187]). At the appeal hearing the landlord stated he was seeking three weeks lost rent. We allow that amount.
6. In relation to the repair of the sensor we allow an amount of $84.70 as reflected in the quote from the licensed electrician.
7. The tenant is to pay the landlord the sum of $1,344.70 within 14 days.

Costs of the appeal

1. The landlord sought his costs of the appeal. Rule 38A of the Civil and Administrative Tribunal Rules 2014 provides that on an internal appeal the Appeal Panel is to apply the first instance costs provisions when deciding whether to award costs in relation to the internal appeal. The proceedings were heard in the Consumer and Commercial Division of the Tribunal and the amount claimed was less than $30,000. The general rule in relation to costs in the Tribunal is that unless special circumstances are established, the parties pay their own costs: s 60(1) of the NCAT Act.
2. The landlord has not identified any special circumstances which would entitle him to costs. The application for costs is dismissed.

Orders

1. We make the following orders: 1. Leave to appeal granted. 2. Appeal allowed. 3. The tenant is to pay the landlord the sum of $1,344.70 within 14 days. 4. Orders 1 and 2 made in RT 19/30915 and RT 29276 on 9 September 2019 are otherwise affirmed. 5. The landlord's application for costs is dismissed.

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: 30 June 2020