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The rent increase application 4. The respondents were tenants at the applicant’s premises at Giles Street Kingston. The lease was from 26 June 2024 to 23 June 2025. Following the expiry of this term, the lease because a periodic tenancy. The lease finished on 12 February 2026 when the respondents moved out. The application is therefore for a backdated rent increase from 16 September 2025 to 12 February 2026, 21 weeks and two days, totalling to $532.14.

5. On 22 July 2025, Ms Tenika Stewart of Civium wrote to the respondents by email. That email stated: ‘We are writing to inform you, based on instructions from the lessor, that your rent for … Giles St Kingston ACT 2604 will be subject to a rent increase of $25 per week, effective from 14 September 2025.’ The email went on to note that his increase exceeded the prescribed amount allowed under the Act

1 Application dated 11 November 2025 and that the prescribed amount was $3.89. There was no dispute between the parties that this was the prescribed amount.

6. Ms Teoh responded on 22 July 2025 (the same day), declining to agree to the increase and raising a number of matters, including that the notice provided was ‘less than the required 8 weeks.’ Indeed, the proposed commencement of the rent increase was seven weeks and five days from the date of the notice.

7. There was a chain of emails exchanged about the rent increase, in which some offers of compromise were made on each side. This exchange culminated in an email from Ms Teoh on 13 August 2025. She raises a number of concerns ‘about the management of our property’, the first of which was: nd Firstly, as noted on the 22 of July when we were first asked to accept the rent increase, the proper notice of 8 weeks as outlined by the Renting Book was not provided. Can you please confirm that any rent increase would take th effect after the 16 of September 2025?

8. Ms Teoh raises some other matters concerning comparable properties in the area, and declines to agree to the proposed rent increase.

9. This is what appears in the email chain printed and submitted by the applicant, and was not disputed by the respondents. The applicant’s agents did not at any point in that email exchange respond to the issue of the period of notice given. The applicant’s next step in relation to the rent was to make the application now before me.

10. It is convenient and useful to review the provisions of the Act relevant to rent increases and the associated clauses of the standard terms of the lease prescribed under the Act. The lease between the applicant and the respondents contained the rent increase clauses from the standard terms.

11. Section 64B of the Act is as follows: 64B Limitation on rent increases—amount (1) A rental rate increase for premises must not be more than the amount prescribed by regulation unless— (a) for a fixed term agreement to which section 64A applies—the agreement allows the lessor to increase the rental rate by the higher amount; or (b) after the lessor gives notice under subsection (2), the tenant agrees, in writing, to the increase; or (c) the lessor obtains the ACAT’s prior approval. (2) For subsection (1) (b), the lessor must give the tenant a written notice stating— (a) the day the proposed increase takes effect (being a day at least 8 weeks after the day the notice is given); and (b) the amount of the proposed increase; and (c) whether the amount of the proposed increase is more than the amount prescribed under subsection (1); and (d) if the proposed increase is more than the amount prescribed under subsection (1)—that if the tenant does not agree to the increase, the lessor may only make the proposed increase with the prior approval of the ACAT.

12. I pause to note here that section 64A applies to leases that commenced before the commencement of the Housing and Consumer Affairs Legislation Amendment Act 2024, section 76. That provision commenced on 9 January 2025. Accordingly, the lease in this matter is a lease to which section 64A applies.

13. Section 64A(2) provides: The rental rate under the agreement must not be increased during the fixed term unless the amount of the increase, or a method for working it out, is set out in the agreement.

14. The effect of sections 64A and 64B is that there are three ways for a lessor to increase rent by more than the prescribed amount: first, by operation of the lease; secondly by providing a notice that complies with section 64B(2) and obtaining the consent of the tenant; and thirdly by obtaining ACAT’s prior approval.

15. In this matter the lessor did not obtain the consent of the tenants, and is (perhaps obviously) not seeking prior approval from ACAT, as the period for which the rent increase is sought is in the past. So the only way for the lessor to obtain the rent increase he seeks is the operation of the lease.

16. The relevant clauses of the lease are clauses 38 to 41, which I set out in full: Review of excessive rent increases (38) The Lessor must give the Tenant 8 weeks written notice of intention to increase the rent and include in the notice the amount of the increase, and the date when it is proposed to increase the rent. 39 (1) The Tenant may apply in writing to the tribunal for review of an excessive increase in rent (time limits for applying and the meaning of excessive is set out in the Act). (2) On such application being made, no increase in rent is payable until so ordered by the tribunal. 40 If the tenant remains in occupation of the Premises without applying to the tribunal for review, the increase in rent takes effect from the date specified in the notice. 41 If the tenant wishes to vacate the premises before the increase takes effect, the tenant must give 3 weeks’ notice to the lessor.

17. A lessor can give a tenant eight weeks notice of a rent increase that exceeds the prescribed amount per clause 38, and, under clause 40, the rent increase takes effect from the date specified in the notice unless the tenant applies to ACAT for review of the rent increase.

18. The tenants in this matter have not made an application for review of the rent increase proposed by the notice issued to them on 22 July 2025. However, consistent with their emails to Civium on 22 July and 13 August 2025, the tenants maintain that they were not given eight weeks notice as required by the Act and by clause 38, and so the rent increase has not come into effect. The applicant submitted at the hearing that the specification of 14 September 2025 was ‘a mistake’ and the rent increase should be allowed from the eight week mark, that is, 16 September 2025. This is reflected in the application, which seeks a rent increase from that later date.

19. The question of what to do when the lessor has given a notice of rent increase that does not meet the requirements of the Act was considered by the Tribunal in Hamilton v Zhang [2024] ACAT 3 (Hamilton). That matter required consideration of a range of matters but among them was the effect of a notice issued to the tenants purporting to increase the rent. The relevant notice was issued on 20 September 2020, so the Tribunal was considering a slightly different version of Part 5 of the Act. However, section 64B was not materially different. In that case, the notice was missing the required features of informing the tenant that the increase was in excess of the prescribed amount and that they could seek review at ACAT.

20. Presidential Member Robinson concluded her consideration of that aspect of the matter as follows: 106. The requirements imposed on a lessor by section 64B of the [Act] are in mandatory terms: a lessor may increase the rent by more than the amount set in regulation “only if” one of the listed set of circumstances applies. If the lessor seeks the tenant’s permission, the lessor “must” give a written notice with the necessary content. It follows that if the prescribed process is not followed, the proposed rent increase is unlawful. 107. Where a rental increase above that allowed by regulation is proposed, challenged by a tenant, and then comes before this tribunal, the [Act] provides guidance on how the difference of view is to be resolved. The tribunal is provided with powers to resolve such a dispute, for example by allowing or disallowing some or all of the proposed increase. But these powers are only enlivened if the process in the [Act] is followed, that is, if the tenant applies for review, having been informed of the increase and its excess over the amount allowed by regulation. If the process has not been followed, these powers are not available, and the inevitable outcome is that the proposed excessive rent increase is disallowed.

21. The applicant in this matter filed and the respondent contested information about comparable rents. The respondents also contended that the state of repair of the premises meant that I should not allow the increase proposed by the applicant. This was all intended to be information that went to the test in section 68 of the Act, which lists the considerations to be taken into account in determining an application for review of a rent increase or an application for prior approval of a rent increase. However, that provision only applies in the event that there is an application under section 64B(1)(c) (a landlord’s application for prior approval) or an application under section 64C(1) (a tenant’s application for review of a rent increase). The application before me is neither of those things, so that evidence is not relevant to the decision before me.

22. Instead, I am considering whether the notice given by the applicant on 22 July 2025 was valid despite the incorrect notice period.

23. This turns on interpretation of the notice requirement in clause 38 of the lease. The terms of the lease are prescribed by the Act, but it is nevertheless a contract between the parties. Accordingly, it is relevant to consider the common law rules about the effect of defects in complying with notice requirements in contracts. This was considered by the Victorian Court of Appeal in JPA Finance Pty Ltd v Gordon Nominees Pty Ltd [2019] VSCA 159 (JPA Finance).

24. That matter was an appeal from a first instance decision where the trial judge had found a notice issued under the terms of a deed to be invalid as the notice did not include the name of the addressee of the notice in the ‘To’ section of the notice, but only the name of the lawyer. The deed required that the notice be addressed to the relevant party care of the lawyer to whom the notice had in fact been given. The original decision was overturned on appeal, where the Court of Appeal found, after summarising the relevant case law, that the question of whether the requirements must be strictly complied with is a matter of construction of the contract. In that particular case, the Court found that there was no commercial purpose served by insisting that the name of the addressee appear in the ‘To’ section of the notice, when it was readily apparent from the body of the document to whom the notice was addressed and what it was intending to do.

25. The defect in the notice in this matter is not very much like the defect in JPA Finance in that it is more than an oversight in who the notice was addressed to. However, the issue is not as serious as the problems with the notice in Hamilton, which had left out the parts about the prescribed amount and the right of the tenant to seek review.

26. So the question is: how I should construct the contract between these parties when considering if two days less notice than what is required invalidates the notice?

27. The correspondence between the parties on the subject is relevant here. As mentioned above, the tenants drew to the attention of the lessor that he had not given the required eight weeks notice. Significantly, this happened on the very day the notice was given, and then again on 13 August 2025, some three weeks later. The lessor had ample opportunity to correct the error, if not on the day, then in subsequent days by issuing a new notice with the correct notice amount. This latter course would have reset the clock, but would have had the substantial virtue of putting the validity of the notice beyond doubt.

28. The tenants submitted that they did not make an application for review of the rent increase because of the short notice. It was not put to me in these terms by the tenants, but this is an argument that the tenants raised the notice issue in good faith, and in further demonstration of good faith, attempted to negotiate what they considered to be a fairer sum, so it is not fair to them to allow the notice to be valid but have a different date of effect.

29. The plain effect of clause 38 is that eight weeks notice must be given. On that plain reading, a notice not giving eight weeks notice is not a notice under clause 38. To move away from this plain reading, there would need to be some consideration or circumstance that means that it is reasonable in the context of the contractual relationship between the parties to allow a notice defect to be retrospectively corrected.

30. This clause is part of the standard terms, which are prescribed by the Act. This is essential context for consideration of the clause. It is therefore relevant to consider the purpose of the Act. The objects of the Act are set out in section 4A and relevantly include objects to: (a) define the rights and obligations of tenants and lessors under residential tenancy agreements; and … (e) protect parties to residential tenancy agreements and occupancy agreements from unfair practices …

31. These objects do not suggest that a lessor should be allowed to proceed with a rent increase when they have not given the correct amount of notice. This is further strengthened by the facts of this matter where the tenants drew the issue to the lessor’s attention as soon as the notice was given.

32. I therefore find that the notice given by the lessor on 22 July 2025 was not a valid notice under clause 38 of the lease, and therefore do not find that the rent increase sought by the lessor has effect under section 64B(1)(a) of the Act.

33. Section 64B prevents a rental increase more than the prescribed amount. It is therefore open to me to allow an increase of the prescribed amount. The tenants (the respondents) made this concession in the response to the applicant’s claim, so I will allow that. The prescribed amount is $3.89 per week for 21 weeks and 2 days, coming to $82.80. Before making orders in relation to the rent increase, I need to consider the respondents’ counterclaim. Counterclaim for rent reduction and interference with quiet enjoyment

34. In their counterclaim, the respondents seek a 15% rent reduction on the basis of delays in attending to repairs of a mould issue and roof leak in one of the bathrooms of the property. They state that these issues persisted for over 15 months after being reported, so claim 12 months rent reduction for failure to maintain the premises is a reasonable state of repair. They also claim $250.00 for interference with peace, comfort and privacy from inspection breaches.

35. The latter claim can be shortly dealt with. Ms Teoh gave evidence about this aspect of the matter and mentioned three occasions that she relied on for this part of the matter. In August 2025, while attempting to deal with the mould problem, an agent showed up without notice to inspect the painting issue that the tenants had complained of. The tenants consented to the agent entering for that purpose. The second incident was on 15 August 2025 when the agents scheduled an inspection of the property without giving the required one week notice. The agents rescheduled, but only to 19 August 2025, causing stress to the tenants over the weekend. The third incident the tenants rely on is that the agents did not advise the tenants about an open house for the property scheduled for 3 February 2026. The tenants found out about it on 2 February 2026 after noticing the advertisement for it. However, they consented to the inspection going ahead.

36. These matters were doubtlessly disconcerting and inconvenient to the tenants in some ways, but I do not find that they amounted to interference with quiet enjoyment that would warrant compensation. I therefore dismiss that part of the respondents’ counterclaim.

37. In relation to rent reduction claim, the tenants gave evidence that they reported a mould issue in one of the bathrooms on 3 April 2024 and that issue was not ultimately resolved until 28 July 2025 when an exhaust fan was installed and the mould was painted over.

38. Ms Sloan gave evidence about this aspect of the matter, as it was her bathroom in the apartment. In April 2024, they notified the agents about lack of ventilation causing peeling paint and mould issues. No substantive response was received for five months, despite the tenants raising health concerns about the mould. After this five month period, the agents arranged a series of tradespeople to attend, but no action was taken to address the issue until 14 July 2025 when an extraction fan was installed in the bathroom. On 4 August 2025 a painter attended, but after their work was finished, mould remained visible, which was not remediated until 13 August 2025.

39. The tenants did not submit photos of the extent of the mould, nor did they give an account of action they took themselves to deal with the mould, so I am unsure of the exact extent and seriousness of the mould problem. I accept the tenants’ evidence that they were concerned about the possible health effects. Ms Sloan gave evidence that the bathroom was still usable, but she minimised the amount of time she spent in there and was concerned about the possible health impact during the 16 months it took to address the problem.

40. The applicant did not file any material responding to the counterclaim. Mr Pennay explained that there had been no directions requiring them to respond so they did not. I pointed out to Mr Pennay that the directions explicitly refer to the intention of the tenants to file a counterclaim, and he conceded that Civium, and the applicant, were aware that the counterclaim had been made. I am satisfied that the applicant had ample opportunity to file a response and evidence in support of his side of the matter, and there is no lack of procedural fairness here.

41. Despite the applicant having filed no material, I allowed the agents to give a verbal explanation of their side of the matter, on the basis that I may not give significant weight to their statements if I became concerned that the respondents had not received procedural fairness.

42. They did not dispute the timeline or the fact that there was a mould issue that took 16 months to remediate. They explained that they had initially received advice that an extraction fan could not be installed, but after a series of visits from several different contractors, a fan was ultimately installed and they arranged the painting. No explanation was offered for why the painting could not have been carried out immediately, even as a stop gap measure to reduce the health impact of the mould. The agents also did not give evidence that the mould would have been able to be dealt with by the tenants. It was not disputed that there was no mould issue at the commencement of the tenancy.

43. The lessor’s obligation to effect repairs is set out in clauses 55 to 57 of the lease. The relevant parts of clause 55 are as follows: 55 (1) The lessor must maintain the Premises in a reasonable state of repair having regard to their condition at the commencement of this Tenancy Agreement. (2) The Tenant must notify the Lessor of any need for repairs.

44. Clause 57 requires the lessor to effect non-urgent repairs within four weeks of being notified: 57 Subject to clause 55, the Lessor must make repairs, other than urgent repairs, within 4 weeks of being notified of the need for the repairs (unless otherwise agreed).

45. The lessor’s obligation to carry out repairs under clauses 55 and 57 has been considered many times by this Tribunal. Senior Member Hyman summarised the relevant cases succinctly in Hembling v Xu [2024] ACAT 33 (Hembling). At [41] he says: It is also established in the case law that the requirement for repairs to be undertaken during the tenancy, under standard term 57, is also mandatory; a lessor is obliged to complete repair within four weeks of being notified of the need under standard term 55(2). It is not a defence that the lessor did their best if they failed to meet that timeline. (See Peters v ACT Housing [2006] ACTRTT 6 at [41] (the paragraph numbering has become corrupted – the relevant paragraph [41] is close to the end of the case); Salem & Gizgeez v Abeygunasekara & Jeevanthan [2011] ACAT 1 at [44]; But v Baldwin [2016] ACAT 9 at [31]).

46. Accordingly, even giving full weight to the evidence of the agents, I find that the lessor is in breach of his obligation to maintain the premises in a reasonable state of repair, as the issue reported by the tenants was not addressed for over 15 months, well over the one month allowed by the lease.

47. The provision of the Act about rent reduction is section 71: 71 Reduction of existing rent (1) On application by a tenant, the ACAT must order a reduction in the rental rate payable under a residential tenancy agreement if it considers that the tenant’s use or enjoyment of the premises has diminished significantly as a result of any of the following: (a) the loss or diminished utility of an appliance, furniture, a facility or a service supplied by the lessor with the premises as a result of— (i) the withdrawal of the appliance, furniture, facility or service by the lessor; or (ii) the failure by the lessor to maintain the premises and any appliance, furniture or facility supplied with the premises in a reasonable state of repair, having regard to their condition at the commencement of the residential tenancy agreement; or (iii) the failure by the lessor to provide and maintain the locks or other security devices necessary to ensure that the premises are reasonably secure; (b) the loss of the use of all or part of the premises; (c) interference with the tenant’s quiet enjoyment of the premises or the tenant’s ability to use the premises in reasonable peace, comfort and privacy by the lessor or anyone claiming through the lessor or having an interest in, or title to, the premises. (2) To remove any doubt and for subsection (1), a tenant’s quiet enjoyment of premises is interfered with if there is substantial interference with, or a significant lessening of freedom in exercising, the tenant’s rights. (3) A reduction in the rental rate ordered under subsection (1)— (a) takes effect from the day the tenant’s use or enjoyment of the premises diminished, or the later date that the ACAT specifies; and (b) remains in force for the period, not longer than 12 months, specified by the ACAT. (4) The ACAT may order a lessor to pay to the tenant the difference between the rent paid and the rent payable as a result of an order for a rental rate reduction. (5) Any purported increase in the rental rate in relation to premises for which a reduction order is in force is void and any amount paid above and beyond the reduced rental rate in accordance with a purported increase is a debt owing by the lessor to the tenant.

48. The tenants are therefore entitled to a rent reduction if they have established that their quiet enjoyment of the promises was diminished significantly as a result of the lessor’s failure to carry out repairs within the one month allowed by clause 57 of the lease.

49. As mentioned above, Ms Sloan’s evidence was the bathroom was useable, but she and Ms Teoh had concerns about the effect on their health during the time it took to be remediated. They submitted that the loss of enjoyment arises not only from the failure to repair the mould issue, but also that the great length of time it was left unrepaired was itself an interference with their quiet enjoyment of the premises, in a similar manner to that found in the Hembling case to which I have already referred.

50. The tenants also mentioned that there was an intermittent leak in the bathroom which took a long time to be repaired. It turned out that it was a leak caused by an overflow in the premises upstairs, which only happened if someone took a long enough shower. While I accept the evidence that there was a delay in effecting repairs, I do not consider that this adds substantially to the loss of amenity caused by the mould issue and the delay in responding to that.

51. In Hembling, the Tribunal gave a rent reduction of $50.00 per week in circumstances where the lessor was completely unresponsive to emails about heating over a period of 13 weeks. That compares to the 4 months it took for the agents to respond in this matter and the further 12 months it took for the repairs to be effected.

52. The tenants submitted that there should be a rent reduction of 15% for 12 months arising from this breach. They submitted that this was the reduction as ruled by the Tribunal in a similar case, but, somewhat unhelpfully, were not able to refer me to the relevant case.

53. A 15% rent reduction was allowed in Arthur v Geromboux [2021] ACAT 20 (Arthur). In that case, a bedroom was rendered unusable as a result of a mould issue which the Tribunal found was the responsibility of the lessor, which is a significantly larger impact than the situation facing the tenants in this matter.

54. While I do not consider this matter to be very similar to Arthur, I nevertheless find that the mould issue in the bathroom did affect the tenants’ quiet enjoyment of the premises, and also that the long delay in remediating the issue contributed some further loss of amenity. The assessment of loss in cases like this is not an exact science. As observed by the Tribunal in Hembling, assessments of compensation are the kind of matter on which minds are likely to differ (at [83]). In that matter, the $50.00 rent reduction amounted to a 6.25% reduction in rent, in circumstances where the tenant reasonably believed the heating in the premises was unusable (though the Tribunal did not explain it in terms of a percentage reduction). This matter does not involve any part of the premises being unusable.

55. Overall, taking the two parts of the matter together (the failure to repair itself and the loss of amenity from the delay) I consider that a 7.5% rent reduction is a fair assessment of the loss of amenity. 7.5% of $590.00 per week for 52 weeks comes to $2301.00. I find that under section 71(4) of the Act the lessor is liable to the tenants in that amount and accordingly allow the tenants’ counterclaim.

Conclusion

56. Having allowed the applicant’s application for a rent increase, but only for $82.80, and finding for the tenants in their application for a rent reduction in the sum of $2301.00, I find that the applicants are to pay the respondents the sum of $2218.20.

……………………………….. Member P Coleman

Date of hearing: 14 April 2026 Applicant: Authorised representative, Jay Pennay, Civium Property Group Respondents: In person