Wallbank v Angelos

The Decision

1. The Tribunal's reasoning is set out in the following paragraphs of the Decision: "19. What is disputed between the parties is whether the discounted sum of $235 per week was to be deferred or waived. The landlord contends that the agreement was to reduce the rent until the tenant's financial position improved, with payment of the balance of $235.00 per week to be deferred until the tenancy ended. 20. The tenant argues that there was never any discussion of whether the $235.00 per week was being waived or deferred; the tenant's (sic) assumed that the rent was reduced to $400.00 per week with no balance to be owed in the future. That is, the tenant's position is that, as there was no express discussion of whether that balance would be waived or deferred, it should be waived. 21. As discussed with the parties, the Tribunal must determine the matter based on the evidence before it. That evidence includes a written residential tenancy agreement which identifies rent payable of $635.00, together with conflicting arguments advanced by each party regarding whether the balance remaining after rent was reduced to $400.00 per week was to waived or deferred. While the Tribunal accepts that the parties agreed to a reduced rental payment of $400.00 from 5 April 2020, on the tenant's own oral evidence, there was never any express discussion of whether the difference of $235.00 was to be waived or deferred. The Tribunal cannot assume, or be sufficiently satisfied on the evidence, that the initial written agreement that rent of $635.00 per week was payable, was varied in a way which waived the requirement to pay the balance of $235.00 per week. 22. On the evidence before me, I am sufficiently satisfied that the applicant's claim for rental arrears, calculated at 23 weeks x $235.00, is established to the civil standard, and order that the tenants pay the landlord the sum of $5405.00."

Principles relevant to the determination of the appeal

1. To succeed in this appeal, it is necessary for the tenants to demonstrate that the Tribunal has made an error of law, or that it is appropriate to grant leave to review the Tribunal's decision on other grounds: s 80(2) of the NCAT Act.
2. As the appeal is from a decision of the Consumer and Commercial Division of the Tribunal, the circumstances in which the Appeal Panel may grant leave to are limited to those set out in cl 12(1) of Sch 4 of the NCAT Act.
3. The question of when it is appropriate to grant leave to appeal from a decision of the Consumer and Commercial Division was addressed in some detail in the oft-cited decision of an Appeal Panel in Collins v Urban [2014] NSWCATAP 17 at [65] - [84]. The following principles, extracted from that decision, are relevant.
4. First, the Appeal Panel's discretion to grant leave is only enlivened if the Panel is satisfied that the tenants may have suffered a substantial miscarriage of justice because, per cl 12 of Schedule 4: (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).
5. Secondly, cl 12 does not require that the Appeal Panel must be satisfied that the tenants have actually suffered a substantial miscarriage of justice. All that is required is that the tenants 'may' have suffered such a miscarriage.
6. Thirdly, the concept of a substantial miscarriage of justice refers to a failure in the way a matter was conducted or decided which deprived the tenants of a chance that was fairly open of achieving a better outcome than occurred.
7. Fourthly, it should be accepted that a substantial miscarriage of justice may have been suffered because of any of the circumstances referred to in cl 12(1)(a), (b) or (c) where there was a "significant possibility" or a "chance which was fairly open" that a different and more favourable result would have been achieved for the tenants had the relevant circumstance in para (a) or (b) not occurred or if the fresh evidence under para (c) had been before the Tribunal at first instance.
8. Fifthly, in order to show that a party has been deprived of a "significant possibility" or a "chance which was fairly open" of achieving a different and more favourable result because of one of the circumstances referred to in cl 12(1)(a), (b) or (c), it will generally be necessary for the party to explain what its case would have been and show that it was fairly arguable. If the party fails to do this, even if there has been a denial of procedural fairness, the Appeal Panel may conclude that it is not satisfied that any substantial miscarriage of justice may have occurred.
9. Sixthly, if the Appeal Panel is satisfied that the tenants may have suffered a substantial miscarriage of justice on one of the grounds identified in cl 12(1)(a), (b) or (c), then the Appeal Panel 'may' grant leave under s 80(2)(b) of the Act. In other words, the Appeal Panel retains a discretion.
10. Seventhly, the principles which govern the granting of leave to appeal by the Appeal Panel under s 80(2)(b) should generally be consistent with those which are applied by Courts when considering the question of leave to appeal. The general principles can be summarised as follows: 1. in order to be granted leave to appeal, the applicant must demonstrate something more than that the primary decision maker was arguably wrong in the conclusion arrived at or that there was a bona fide challenge to an issue of fact; 2. ordinarily it is appropriate to grant leave to appeal only in matters that involve: 1. issues of principle; 2. questions of public importance or matters of administration or policy which might have general application; or 3. an injustice which is reasonably clear, in the sense of going beyond merely what is arguable, or an error that is plain and readily apparent which is central to the Tribunal's decision and not merely peripheral, so that it would be unjust to allow the finding to stand; 4. a factual error that was unreasonably arrived at and clearly mistaken; or 5. the Tribunal having gone about the fact finding process in such an unorthodox manner or in such a way that it was likely to produce an unfair result so that it would be in the interests of justice for it to be reviewed.
11. Where, as in the present case, the tenants are not legally represented it is appropriate for the Appeal Panel to review the stated grounds of appeal, the material provided, and the Decision to examine whether it is possible to discern grounds that may either raise a question of law or a basis for leave to appeal: Cominos v Di Rico [2016] NSWCATAP 5 at [13].

Consideration

1. We have considered the Decision, the evidence that was before the Tribunal and the sound recording of the hearing of the landlord's application. Having done so, we are satisfied that the tenants may have suffered a substantial miscarriage of justice.
2. The possibility of a substantial miscarriage of justice arises from: 1. the absence before the Tribunal of a sufficiently clear and cogent account or accounts of the facts relevant to the determination of what was said during the 5 April 2020 Conversation; 2. the Tribunal's Decision turning upon a finding as to what was not said during the 5 April 2020 Conversation, which finding was contrary to the evidence.
3. The sound recording of the hearing reveals the following salient features of the conduct of the hearing in so far as it concerned the claim for rental arrears: 1. each of Mr Wallbank (who appeared on behalf of the tenants) and the landlord took an affirmation to tell the truth; 2. it became apparent relatively early in the hearing that the central issue was what was said in the 5 April 2020 Conversation; 3. the Tribunal asked each of Mr Wallbank and the landlord to identify any documents they relied upon which were relevant to that issue. The documents identified by the parties included: 1. the tenants' document titled 'Tribunal Statement' which included: "Following my message, on 5 April, I have (sic) a phone call with Dione to discuss our circumstances and a resolution. After a brief discussion the agreed outcome was a rent reduction to $400 p/w to allow Dione to continue making weekly mortgage repayments and prevent us from paying rent back in arrears." and "We made it clear from the onset a reduction or moving out were the only two options available to us as tenants." 1. the landlord's Timeline and Statement of Events dated 28 October 2020 which included: "I offered for the respondents to pay $400 per week instead of $635 per week as a deferred amount, with the balance of the $235 per week to be paid back at the end of the tenancy. This represented a significant decrease of 37% in the rent that I would receive and I was prepared to make that sacrifice to assist them, with the promise that they would make good and pay back the deferred amount at the end of the tenancy, since I took this into account when making this offer to the respondents that the other funds payable would come so that I could cover ongoing costs incl strata levies, mortgage and rates, this arrangement allowed the respondents to remain in accommodation, which otherwise being unemployed would have made it near impossible to get other accommodation at this level. We agreed that I would offer this for an initial 3 months and then see how we go. The respondent Myles confirmed this arrangement and that he was happy with this to be a deferred amount to be paid back later on as he believed that both respondents would have the financial capacity to be able to pay this back. In the instance that I would have provided a "discount" it would have been significantly less and a very small amount, not enough for them to be able to meet the rental payment, hence why the above offer of a larger deferred amount of rent was made to assist them. Giving a 37% discount on the rent, was in no way financially viable for me as it would not have been sufficient to cover my ongoing financial obligations for the property, hence why there was never a conversation about a discount of this amount, it was always a deferred rent amount to be paid back later. Myles confirmed that he was happy with this arrangement and that he understood that the rent was to be paid back towards the end of the lease." 1. there was no document contemporaneous with the 5 April 2020 Conversation which was a record of what was said; 2. the Tribunal did not invite either Mr Wallbank or the landlord to state their recollection of what had been said in that conversation; 3. the Tribunal did not invite either Mr Wallbank or the landlord to cross- examine the other; 4. after the Tribunal indicated that it was about to move from the rental arrears claim to the repairs claim, the following exchange occurred: "Tribunal: Mr Wallbank, can I ask you did you ever ask whether the difference would be deferred or waived? Mr Wallbank: Well, yes it was in the original conversation. I remember we had a conversation on the Sunday the 5th about our current situation after I tried to contact multiple times through texts to no avail. The conversation was brief and it was simply the fact came down to we had two options as tenants whether we could either get a reduction or we would be forced to move out on our own terms and the discussion was that we were all aware of the situation around us and that we were being encouraged to come to a decision and Ms Angelos stressed that she wanted to avoid having to put her mortgage on hold and that we came to an amount payable which was $400 per week that suited everybody because that allowed her to keep paying her mortgage repayments and also allowed us to stay in the property and it was as simple as that. There was never a discussion of deferring or paying rent back. We simply wouldn't be able to afford to live there if the money was being deferred. I mean we would essentially still be paying the full amount. Tribunal: So it was never expressly discussed at that point a deferral or waiver was never expressly discussed. Is that what you're saying? Mr Wallbank: Absolutely." The landlord: During that conversation, I categorically deny that I discussed my personal financial position with my tenant and asked him for financial advice. The amount that was deferred was a sufficient amount to assist them with their current cash flow to be able to wear through that period and come to a sort of a better position in time and some sort of an agreement to pay back as a lump sum if they could or I was actually prepared to engage them in a payment plan to amortise that deferred amount.
4. The absence of a sufficiently clear and cogent account or accounts of the facts relevant to the determination of what was said during the 5 April 2020 Conversation is the product of the following: 1. the evidence contained in the statements relied upon by the parties was conclusionary and of little assistance to the determination of what had been said. We note that the Tribunal did not refer to this evidence in its Decision; 2. the Tribunal did not invite either Mr Wallbank or the landlord to state their recollection of what was said; 3. the Tribunal did not invite either Mr Wallbank or the landlord to cross- examine the other; and 4. the evidence given at the end of the part of the hearing which dealt with the rental arrears claim, and which is reproduced above, also contains no direct evidence as to what was said in the 5 April 2020 Conversation.
5. Further, and perhaps as a result of the absence of sufficiently clear and cogent account of what had been said during the 5 April 2020 Conversation, the Tribunal did not address in its Decision the evidence of what had been said. Instead, the Tribunal made findings as to what had not been said, and in particular findings that: 1. "The tenant argues that there was never any discussion of whether the $235.00 per week was being waived or deferred" (Decision [20]); 2. "…on the tenant's own oral evidence, there was never any express discussion of whether the difference of $235.00 was to be waived or deferred" (Decision [21]).
6. As to (1), the sound recording of the hearing does not record that the tenants made such an argument.
7. As to (2), the only evidence which touches upon this matter is the following passage: "Tribunal: Mr Wallbank, can I ask you did you ever ask whether the difference would be deferred or waived? Mr Wallbank: Well, yes it was in the original conversation. I remember we had a conversation on the Sunday the 5th about our current situation after I tried to contact multiple times through texts to no avail. The conversation was brief and it was simply the fact came down to we had two options as tenants whether we could either get a reduction or we would be forced to move out on our own terms and the discussion was that we were all aware of the situation around us and that we were being encouraged to come to a decision and Ms Angelos stressed that she wanted to avoid having to put her mortgage on hold and that we came to an amount payable which was $400 per week that suited everybody because that allowed her to keep paying her mortgage repayments and also allowed us to stay in the property and it was as simple as that. There was never a discussion of deferring or paying rent back. We simply wouldn't be able to afford to live there if the money was being deferred. I mean we would essentially still be paying the full amount. Tribunal: So it was never expressly discussed at that point a deferral or waiver was never expressly discussed. Is that what you're saying? Mr Wallbank: Absolutely."
8. In our view, this passage of evidence does not provide a basis for a finding that the tenants gave evidence that there was no discussion of whether the balance was to be waived or deferred, as: 1. Mr Wallbank's immediate response to the Tribunal's question "did you ever ask whether the difference would be deferred or waived?" was: "Well, yes it was in the original conversation", which answer is in direct contradiction to the finding made. 2. Later in that answer, Mr Wallbank said: "There was never a discussion of deferring or paying rent back". This statement related only to deferral. In other words, he did not say that there was no discussion of waiver. 3. The Tribunal responded with the question: "So it was never expressly discussed at that point a deferral or waiver was never expressly discussed. Is that what you're saying?" which question mischaracterised what Mr Wallbank had said, by suggesting that he had said that waiver had not been discussed. 4. Mr Wallbank's answer "Absolutely" is ambiguous - it is neither yes nor no and could be taken to be an emphatic statement that he agreed with what had been put to him or an emphatic statement that deferral or waiver had been discussed.
9. For all of the above reasons, in our view the evidence before the Tribunal concerning the 5 April 2020 Conversation did not provide a sufficiently clear and cogent account of the facts relevant to the determination of what was said in that conversation. Where findings of fact are made in such circumstances and such findings are central to the decision, the decision may be set aside on appeal on the basis that hearing has miscarried and be remitted to the primary decision-making body for re-hearing: see Pahlow-Silady v Siladi [1997] NSWCA 241, per Gleeson CJ; and per Powell JA; Costa v The Public Trustee of NSW [2008] NSWCA 223 at [112].
10. Further, the finding that the tenants' evidence was that there was no discussion of whether the balance was to be waived or deferred was a finding made contrary to the evidence for the reasons set out at [30] above.
11. Hence, we are satisfied that the discretion to grant leave has been enlivened because the requirements of cl 12 of Sch 4 of the NCAT Act have been met. In particular, it is our view that the tenants may have suffered a substantial miscarriage of justice because the Decision of the Tribunal was (a) not fair and equitable and (b) was contrary to the evidence.
12. We are also satisfied that it is appropriate to exercise the discretion to grant leave to appeal. The matters discussed above demonstrate errors which are central to the Decision as well as an unorthodox fact finding process likely to have produced an unfair result.
13. For the same reasons, we allow the appeal.

Orders

1. The orders of the Appeal Panel are: 1. The appellants have leave to appeal. 2. Appeal allowed. 3. The proceedings be remitted to the Consumer and Commercial Division of the Tribunal for re-hearing.

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: 10 May 2021