Residential Tenancies Act 1997 (ACT)

ACT Civil and Administrative Tribunal Act 2008 (ACT)

CIVIL AND ADMINISTRATIVE TRIBUNAL ) No: RT 83 of 2009

1. The Respondent/lessor is to pay the Applicant/tenant the sum of $3812 within 28 days.

2. The Office of Rental Bonds is to return the whole of the bond to the tenants.

CIVIL AND ADMINISTRATIVE TRIBUNAL ) No: RT 83 of 2009

1. The residential tenancy agreement in this matter was entered on 24 April 2008. The premises are in O'Connor in the ACT. The tenancy was for a fixed term of 12 months at a rent was $650.00 per week and with a bond of $2600.00. The residential tenancy agreement was in the standard form of the prescribed terms of the Schedule to the Residential Tenancies Act 1997 (ACT) (the Act). The residential tenancy agreement contained some clauses endorsed under section 10 of the Act, the only relevant one being the gardening clause:

The tenants acknowledge that they are responsible for the maintenance of the lawns, also weeding of the gardens at the property. The tenant also understands that even with water restrictions there are suitable and allocated times to water and keep the gardens looking as healthy as possible according to such restrictions - this garden requires sufficient water to continue its current condition.

There is an automatic watering system that has been pre-set to water the gardens. If the watering system fails please notify the office and the gardener will reset the system

A gardener is provided on a quarterly basis as part of the tenancy to maintain the shrubs and trees

1. The case concerns the tenants' complaints that:
   • (a) the premises were at the upper end of the rental market and the tenants expected a commensurate level of facilities and services which they assert they were not accorded.
   • (b) the premises suffered a serious roof leak on 28 May 2008 that was not repaired by the landlord until 27 January 2009. The tenants' case is that the roof leak caused the loss of use of the dining room for 34 weeks with consequential inconvenience.
   • (c) from the start of the tenancy the dishwasher leaked onto the floor and was not fixed for 2 weeks
   • (d) from the start of the tenancy six down lights in the living room/kitchen did not work and 4 lights in the master bedroom did not work. These lights were not fixed until 6 August 2008.
   • (e) from the beginning of the tenancy the lock on the rear security door was defective
   • (f) the residential tenancy agreement provided for a gardener to attend to pruning of the trees and shrubs on a quarterly basis but he came only once. The gardens were generally overgrown and in a poor state at the commencement of the tenancy.

2. The tenants were seeking an early termination of the fixed term of the lease, compensation for the loss of facilities and compensation for the loss of quiet enjoyment associated with the above complaints. The Tribunal made the order for the early termination of the tenancy with consent of the landlord on 17 March 2009 effective 20 March 2009, leaving only the compensation issues outstanding.

3. The landlord's case is that the tenants have overstated the inconvenience suffered and have generally failed to mitigate their losses by taking more insistent action to with the landlords agent to have the repairs undertaken.

The history of the proceedings in the Tribunal:

1. On 12 February 2009 the tenant filed an application in the Tribunal with the following Statement of Particulars:

That the offer from the Lessor of one (1) week rent free as a gesture of goodwill for the tenants' loss of quiet enjoyment and functional use of the residence is unacceptable to the tenants who have suggested a percentage refund on rent paid of $7,880.00

(a) That the tribunal make an order for the refund of $6,630 in rent in respect of the loss of use and quiet enjoyment of the dining room for 34 weeks and consequential loss of entertainment capacity of important business clients and associates, family and friends.

(b) That the tribunal make an order for the refund of $750 in rent in respect of the loss of quiet enjoyment of the garden as a consequence of the non attendance by the gardener and as part recompense for the tenants' attendance to a range of work as a consequence of the non attendance by the gardener. For the period 24 April 2008 to 10 February 2009.

(c) That the tribunal make an order for the refund of $500 in rent in respect of the loss of quiet enjoyment of the residence in attending to the existing faults to the dishwasher, lighting and security that had to be remedied at the request of the tenants after the commencement of the tenancy.

(d) Release from the fixed term Lease without penalty.

That the property from 28 May 2008 had a serious water inundation problem in the dining room that prevented use of the room for 34 weeks. The matter was drawn to the attention of the Managing Agents over a period of eight months before repairs were effected in mid January 2009. At the completion of the repairs the Lessee offered a one week rent free period as compensation for the tenants' loss of use, inconvenience and disruption resulting from the ceiling leak.

That the property from the commencement of the Lease had a number of existing faults to the dishwasher, lighting and security that had to be remedied at the request of the tenants and detracted from their quiet enjoyment of the property.

That the property from the commencement of the lease had a garden in an untidy and overgrown state that had to be remedied at the request of the tenants and that no further work has been attended to by an appointed gardener since that time. The Lease, by way of the inclusion of an endorsement (Page 16) provided for a gardener to attend to pruning shrubs and trees on a quarterly basis. The tenants have made frequent requests to have this work attended to and have resorted to completing necessary garden maintenance themselves.

The tenants own and operate a commercial retail art gallery and represent prominent artists from across Australia. In 2008, three of the gallery artists were finalists in Australia's premier art prize the Archibald Prize, This level of success by artists from one gallery is rare feat amongst Australian commercial galleries.

The tenants, the only occupants, chose the property (1.2) for the particular aspects of, 'spacious separate formal lounge and dining rooms' and significant wall space to hang artworks. The prime consideration for the tenants in choosing the property as a residence was so that they could entertain their visiting business partner artists and important art buying clients and showcase artworks in an informal manner, integral to the occasion.

The claim of $6,630 is for a 30% refund of rent paid over the period of 34 weeks in which the dining room was not serviceable and takes account of the consequential loss of entertainment capacity of important business clients and associates, family and friends.

The claim is calculated by taking account of the difference in the rent paid i.e: $515.00 at their previous residence (1.3) and that paid in the residence relating to this claim ($650.00 -1.2) and an amount in consideration of the disruption, inconvenience and loss of quiet enjoyment of the property.

That the property from the commencement of the Lease had a number of existing faults to the dishwasher, lighting and security that had to be remedied by the initiation of the tenants and detracted from their quiet enjoyment of the property.

These faults required a succession of maintenance requests to the managing agents and subsequent accommodation of tradespeople to prepare quotations and attend to the repairs.

On the first occasion the dishwasher was used, the water flooded on to the timber floor, through the bottom of the closed dishwasher door. The repair required replacing the door seal which had a significant section missing. The tradesman effecting the repair commented that it had been in that state for some time.

The rear sliding door was extremely difficult to slide, close and secure. The internal door latch failed to secure the door in a locked position and the door had to be secured by locking with a key from outside the house.

On commencement of the lease six down lights in the Living/Kitchen area failed to work. In the Master Bedroom ensuite, four vanity lights failed to work. These were noted on the initial property inspection report. The tenant attempted to purchase replacement globes from three separate specialist lighting retailers, however it was determined that the fittings were either obsolete or the globes were no longer in production.

The amount claimed, $500.00 is in consideration of the disruption, inconvenience and loss of quiet enjoyment of the property.

At the commencement of the Lease the garden was in an untidy and overgrown state with a number of dead and dying shrubs and grass. The agents undertook to have the garden reinstated to an appropriate condition for the commencement of the Lease. This still had not been attended to at the time of the first rental inspection on May 17. The pre-set watering system had been turned off during the 3-4 months that the property had been vacant.

(1.1) The Lease, by way of the inclusion of an endorsement (Page 16) provided for a gardener to attend to pruning shrubs and trees on a quarterly basis. The tenants have made frequent requests to have this work attended to and have resorted to completing most maintenance themselves.

In particular the property has a narrow battle-axe driveway with substantial shrubbery on both sides that when overgrown commences to scrape along the vehicle sides damaging the vehicle paintwork. Many of the shrubs and trees in the garden are overgrown and in a poor state of maintenance. Following rain the branches become laden with the weight of the water and make foot access around the property difficult.

The amount claimed, $750.00 represents $250.00 for each of the three quarterly maintenance schedules missed (5 man hours @$40.00) and in consideration of the disruption, inconvenience and loss of quiet enjoyment of the property.

The tenants request that the Tribunal release them from the fixed term Lease so that they can relocate to a

1.1 The tenant is a tenant of the lessor under a tenancy agreement dated 24 April 2008 in respect of the premises at 2/43 Boobialla Street O'CONNOR and a copy of this document is attached.

1.2 The property with a weekly rent of $650.00 was presented as a three bedroom "executive style home" which included "spacious separate formal lounge and dining rooms" with "'stunning polished timber floors

1.3 The weekly rent at $650 was a 26.2% increase for the tenants who had been paying $515.00 per week at their previous residence (Blackshaw 21.2.07-88B Boldrewood Street, O'Connor) for a property that did not have a separate formal dining area or spacious lounge.

1.4 May 2 2008. Email to Strictly Rentals and attached maintenance request for repairs to dishwasher.

1.5 May 16. Strictly Rentals - Routine Inspection Report. Noted request for attention to the rear sliding door and request follow up attention to reinstate the garden.

1.6 May 28 (Diary Note) Following steady rain on May 26/27 water commenced dripping through the ceiling in the dining room on to the floor and the tenants dining setting. There were already existing stains in two locations on the ceiling as noted in the Property Inspection Report. The tenants concluded that these must have been from a previous inundation and the next day phoned the managing agents to inform them of the problem. As the tenants were leaving to attend an art fair in Brisbane they removed their furniture from the room and left buckets and basins in place in case of further rain in their absence.

1.7 July 23 email to Strictly Rentals. Following further rain the tenants emailed the managing agents and included digital images of the ceiling water inundation and other maintenance matters requiring attention.

1.8 September 24 (Diary Note - Strictly Rentals, Melissa) Again following more rain the tenants called the managing agents to enquire as to what progress there was regarding the ceiling leak.

1.9 October 16 Strictly Rentals - Routine Inspection Report. The Managing Agents carried out a routine property inspection and the maintenance inaction was drawn to their attention yet again. It is noted on the inspection report: 'waiting on maintenance for water leak to ceiling' and 'will check re: gardiner (sic) for you'

2.0 December 22 Letter to Strictly Rentals. Following further heavy rain, the tenants formally wrote to the managing agents detailing the worsening condition and asking for consideration of rent relief as they had been unable to use the dining room or entertain in the manner intended.

2.1 January 5 2009 Letter and phone call from Kouvelis Real Estate advising the tenants that they had been appointed Managing Agents of the property.

2.2 January 5 Email To Kouvelis RE. At the request of the new property managers copies of previous correspondence to Strictly Rentals and an outline of other maintenance matters were emailed to the new agents.

2.3 January 7 Email from Kouvelis RE (Cathy Ryan) conveying apologies from the Lessor and an offer to 'make good and rectify' and suggesting that a rent free period in compensation would be offered.

2.4 January 21 Email from Kouvelis RE advising that repairs were now complete. 'It was major work and we are confident there won't be any more leaks.'

2.5 January 21 Email from tenants offering their ideas regarding the proposed garden maintenance.

2.6 January 23 Email from tenants advising Kouvelis RE that there was a continuing leak through the powder room skylight or exhaust fan.

2.7 January 27 Email to Kouvelis RE. As the major repair works were now completed the tenants wrote to the Managing Agents summarising the past problems and asking for the Lessor to determine the rent free period he would offer.

2.8 February 3 Email from Kouvelis RE. Responded with the Lessor's offer of one (1) week rent free period and release from the current fixed term lease.

2.9 February 3 Email to Kouvelis RE. The tenants rejected the Lessor's offer and detailed a response suggesting a 30% claim for the 34 week period in which the dining room had not been serviceable and detailing other shortcomings in the presentation and maintenance of the property.

3.0 February 4. Email from Kouvelis Re advising that the Lessor wished to have the matter resolved by the Residential Tenancy Tribunal.

3.1 February 4. Email from Kouvelis RE advising that they were not in possession of a property file and that they would not be entering into any correspondence relating to the proposed Residential Tenancy Tribunal claim by the tenants.

1. Annexed to the application were a copy of the tenancy agreement of 24 April 2008 between the parties and a copy of each of pieces of correspondence and diary entries referred to in the tenants Statement of Particulars.

2. The matter was listed before the Tribunal on 2 March 2009 and notices were send to the parties on 11 February 2009.

3. On 23 February 2009 the landlord wrote to the Tribunal seeking an adjournment and asking that he appear by telephone. The landlord said that he was not opposed to the early termination of the lease:

I note that the applicants are seeking, as part of their claim, to have the current tenancy agreement terminated. Early termination of the agreement has already been offered to the tenants by me and this offer was rejected. Should the tenants wish to accept the offer of early release from their fixed term tenancy, this offer still stands and I trust that this fact may be taken into account when considering this application for an adjournment.

1. In response to the landlord's request the matter was relisted before the Tribunal for 17 March 2009

2. Prior to the hearing date the landlord filed his submissions which read:

STATEMENT CONTESTING/DEFENDING APPLICATION RT 83 OF 2009

1. The tenants have sought both compensation and early termination of the lease without penalty. I note that the latter was offered to the tenant and declined by them, prior to this application to the Tribunal being made. The offer has subsequently now been taken up by the tenants, who have given notice of their intention to vacate the property. This response, therefore, addresses only the tenants' claim for compensation.

2. In summary, I consider the tenants' claims to be not only ambit in quantum, but opportunistic in nature. The claim seeks to portray the lessor as consistently negligent, whereas, with one exception, the issues raised constituted routine maintenance, which were dealt with promptly and without demur by the lessor. The exception was a roof leak, which the tenants claim imposed significant disruption on their lives. Yet I consider the nature of the action taken by the tenants to resolve this problem was not commensurate with the degree of disruption they claim to have sustained, and this supposed degree of disruption was only made clear to the lessor after a considerable period had passed - and shortly before a compensation claim was made. For each of the claims cited, the tenants have demonstrably failed hi their duty under Section 38 of the Residential Tenancies Act 1997 to mitigate their own claimed loss.

3. The tenants have also cited the effect on their business as a significant basis for the compensation sought. I highlight that the lease in question is a residential lease and no agreement was provided by the lessor for the property to be used for commercial purposes. In fact, 1 consider the types of activities conducted by the tenants, as noted in their application (notably the commercial display of artworks), to be in breach of their undertaking to use the premises solely for residential purposes (as per Clause 69 of the lease agreement). The nature of the tenants' business and the "prime" reason they claim to have selected the property should therefore not be considered relevant to the claim being made and, indeed, represent cause for the lessor to consider the rent charged over the period of the tenancy to have been insufficient.

4. Though I consider the routine maintenance issues raised to be just that, it is necessary to address each of these claims in turn. These maintenance issues were all dealt with promptly when raised by the tenants and there should thus be no cause for the award of compensation.

5. A request to repair the dishwasher was made on 2 May 2008. It was repaired, without demur, on 8 May 2008 at a cost of $196.95. (Att-1). As the previous occupant of the property, the lessor can attest to the fact that the dishwasher was perfectly functional when the property was vacated. On one occasion in the past, the lessor had experienced a leak from the dishwasher, which was caused by incorrect loading of the machine causing the door to not close fully. Nonetheless, when the tenants requested servicing, this was agreed to and carried out promptly.

6. A request to repair lighting was made on 23 July 2008. These repairs were conducted, again without demur, on 6 August 2008 at a cost of $510 (Att.2). If the lighting was causing "disruption, inconvenience and loss of quiet enjoyment," it is difficult to understand why there was no earlier attempt to have it rectified.

7. Difficulty with the sliding door was reported as part of a routine inspection on 16 May 2008. No earlier reference to it is evident The lessor, as the previous occupant, can attest that the door required a little "wiggling" to lock, but it was certainly fully serviceable. Again, however, this request from the tenant was attended to promptly. The exact dale of repair is not recorded, however it was some time prior to the invoice date of 11 June 2008 (Att. 3).

8. Part of the tenants' claim for compensation arises from dissatisfaction with the state of the garden at the commencement of the lease. The tenants had an opportunity to inspect the property prior to the tenancy and could have opted not to select the property if it did not meet the standards they required. No undertaking was made by the lessor to have the garden "reinstated". Indeed, considerable work was carried out on the garden prior to it being advertised, in order to reduce the maintenance requirements and to improve its presentation for prospective tenants. This fact can be attested to by neighbours.

9. It is difficult to understand how the tenants can identify that the automatic watering system was not functioning during a period when they were not in the property. The watering system was set to provide maximum coverage within the strict limitations of current water restrictions., and its operation confirmed prior to the property being placed on the rental market. The water usage rates (records for which are available but could not be compiled in time for this submission) also attest to significant water usage on the property for that period (whilst the house was vacant). As evidence of the lessor's commitment to keep the garden healthy, it is also noted that the lessor has paid all water usage rates for the property during the period of the tenancy, without seeking recourse to affix a meter and charge the tenant, despite water usage being very significantly higher during the current tenancy than in comparable previous periods. The lessor has been prepared to pay for all water so that there would be no disincentive for the tenants to keep the garden healthy.

10. The tenants claim that there was no maintenance carried out on the garden during the tenancy. Att. 4 evidences a gardening visit on 16 June 2008. There had been no specific complaint about the garden made by the tenants until January 2009, other than two apparent, general requests to ensure that planned maintenance took place. The only mention of the garden prior to January 2009 are general notes from the agent's inspection reports. The tenants' claim of "frequent requests" for gardening is not borne out by their application and at no time were any specifics mentioned by them.

11. Similarly, at no time was the supposed difficulty in accessing the property raised with the lessor. The tenants' claim that their access to the property was hindered by the hedges in the driveway, and that they suffered vehicle damage, should be dismissed on two grounds. First, there has been no evidence submitted by the tenants of any damage to their vehicles. Second, at no point during the tenancy did the tenants complain of access to the property. If they indeed did suffer damage to their vehicle, they made no effort to mitigate their loss by bringing this to the attention of the lessor.

12. I too would have liked the gardening maintenance to have been carried out more regularly and sought to make this happen. However, the "gardening" to be provided by the lessor under the provisions of the lease (as spelt out in the endorsement entitled "Gardening Clause") was demonstrably limited in nature - representing basic pruning of trees and shrubs in order to ensure the longevity of the garden for the owner. The lease clearly notes the shared responsibility for garden maintenance, with the tenants responsible for ensuring it remained viable and free from weeds.

13. A period of approximately six months elapsed between the visit of a gardener on 16 June and the tenants' claim. The assertion that the "trees and shrubs are in a poor state of maintenance" after such a short period of time, through winter, would seem to be exaggerated at best. It is also noted that during the 16 June visit, the gardener was required to spend considerable time attending to weeds and other presentational issues - for which the tenant was responsible under the provisions of the lease (see Att.4). If the maintenance of trees and shrubs did indeed suffer during the period, this can at least partly be attributed to the gardener's requirement to attend to items for which the tenants themselves had agreed to be responsible.

14. For the above reasons, I do not believe that a claim for compensation for garden maintenance has merit. Whilst the visits of a gardener could have been more regular, the lessor has covered the cost of all water used at the property and allowed the gardener to spend time attending to items which were the tenants' responsibility. No serious effort was made by the tenant to previously raise the issues which have been submitted in their application and, in six months through winter, it is difficult to imagine any garden deteriorating to the extent claimed by the tenants.

15. Without hi any way acknowledging the validity of the compensation claim, I submit that the quantum of any claim should, in any case, be based on a proportion of the cost of the one quarterly maintenance visit ($160) missed in the period 16 June 2008 to December 2008, and that such a figure should be offset by the requirement for the gardener to attend to items which were the tenants' responsibility.

16. On the issue of the roof, the tenants' assertion is that they were unable to use the dining room in the property at all. There is, however, no evidence that this was the case and at no stage did the tenants advise the lessor that their ability to use the property was being limited. Indeed, the tenants allowed two months to elapse between communications with the lessor's agent, which would suggest little urgency to the problem and therefore limited, if any, impact on the tenants' "quiet enjoyment" of the property. The extent of the tenants' supposed disruption was only raised shortly before the repairs were made and a compensation claim lodged.

17. I therefore assert that the tenants did not make any sincere efforts in their Section 38 obligation to mitigate their loss. Judgement in the case of Watson vs. Douglas and Xavier (1999), paragraph 64 highlights tenants "ought not...simply (endure) those conditions indefinitely". It is "open to the tenants to apply for orders compelling the lessors to comply with the tenancy agreement and to remedy that very alleged default which is the subject of this application". Moreover, not only were no formal proceedings commenced, (as one would expect if disruption on a scale being claimed by the tenants was being endured) but there was only sporadic mention of the problem to the lessor's agent, only one written request to attend to the problem in 6 months (on 23 July, which did not convey any sense of urgency or ongoing restriction of use), and no mention for 6 months of the extent of the inconvenience supposedly being suffered.

18. With respect to the roof problem itself, I note that efforts were made to rectify it and also that unusually heavy rain in Canberra complicated diagnosis of the problem. The claims by the tenants themselves, together with their history of reporting the problem, suggest that the entry of water into the property was not regular, but only after unusually heavy downpours - a problem experienced by many Canberra homes on two occasions in 2008.

19. As the tenants note, there was evidence of a previous minor leak to the dining room before they moved in. The inference from the tenants' application seems to be that a pre-existing problem had therefore been ignored. In fact, this mark on the dining room ceiling had been present for several years and existed when the lessor purchased the property in 2006, with no occurrence in the intervening time of any leakage. Nonetheless, the lessor undertook roofing maintenance on 15 April 2008, shortly after the tenants occupied the premises, to ensure that, had a problem existed, it did not recur during the tenancy. (Att. 5 refers).

20. The unusually heavy rain experienced in Canberra in May 2008 affected many properties, whose drainage was not able to cope with the quantity of rain. Nonetheless, as the tenants themselves note, further inspections of the roof were carried out after their report of water entering the dining room during this deluge. The lessor was not advised of any problem with the roof as a result of these inspections and there was also no further contact from the tenant until 23 July, when Canberra experienced a second major downpour.

21. Again two months passed before the tenants raised this issue again. There was still no indication of ongoing major disruption to the tenants' use of the property, only a diary note of a phone call to the agent.

22. On December 22 2008, the tenants provided to the lessor the first articulation of the apparent extent of their inconvenience. This provided the first indication of the level of disruption which the tenants felt was being endured. One could have reasonably expected such apparent disruption to life and income to have prompted such an articulation in writing well before this point. The situation was remedied as quickly as possible after this advice from the tenant and considering the availability of contractors over the summer holiday period.

23. The lessor acknowledges that the roof repairs could have been carried out more quickly. Nonetheless, action was clearly taken to address the issue, including previous repair work and subsequent inspections of the property in order to identify the source of the problem. At no time before 22 December 2008 could the lessor have reasonably expected the tenants to be experiencing the level of disruption finally claimed by them on that date. Before this point the lessor could only have been aware that a limited amount of water had entered the property on three occasions over a period of some six months, in a year where unusually heavy downpours had been experienced.

24. The tenants' own language when first reporting the problem in writing on 23 July, and in the only written request prior to December 22, referred to water "dripping on the floor", hi the tenants' Tribunal application this has become a "serious water inundation problem". This would suggest that the tenants either failed to communicate the extent of the problem, or exaggerated their terminology for the purposes of this Tribunal claim. A report from the roofing contractor who undertook the repairs (Att.6) notes that "the extent of the water damage did not appear to be what we would consider 'extensive' (we would have had to replace substantial sections of ceiling plaster if this was the case)".

25. The tenants' claim that the dining room was "not serviceable" would therefore not seem to be supported by sufficient evidence, nor was it a situation that was reported to the lessor. We further understand from the roofing contractor that, in fact, furniture and other effects were present in the room when the repairs were effected. These had to be covered whilst the work was undertaken, (refer Att.6). The tenants have nonetheless claimed that they had been unable to place furniture in this room.

26. I contend that the request for compensation should be dismissed on the basis that the lessor has in all cases responded in good faith to requests for maintenance from the tenants; that the nature of the problem has been under-reported but overstated (there is no evidence that the dining room was "inundated" nor that the leak rendered the room " not serviceable"); and that the tenants themselves failed to adequately express their urgency or the impact on their ability to use the property, prior to 22 December 2008.

27. On the basis of the tenants' written communication of 22 December 2008,1 was initially prepared to offer one weeks' tenancy rent free, based on the fact that I was not privy to the full details of my agent's dealings with the tenant over the development of the roof problem, and wished to display my goodwill to the tenants and my intention to provide them with a quality property on an ongoing basis. With the benefit of the fall history, as documented in the tenants' application, however, I now view the tenants' claim as opportunistic and cannot understand why, despite such apparent disruption to their residency and business, months passed without any written requests for action, no real urgency was conveyed, nor the extent of the claimed disruption to the tenants' lives mentioned until December 2008. The actions of the tenant are not commensurate with the disruption they claim to have experienced and thus I feel they did not make a sincere effort to mitigate their own loss.

28. The basis for the tenants' calculation of the compensation claimed would also seem unreasonable. I contend that the rent paid by the tenants in a previous property is not relevant to any claim on the current property. To suggest that a difference in rent of 30% between two properties is due only to the existence of a separate dining room is simplistic in the extreme.

29. The evidence presented by the tenants suggests that water entered the room on three occasions over a period of 6 months and there is no evidence of "inundation" as claimed by the tenants, nor of any damage to the tenants' property. The minor disruption from heavy rain deluges did not warrant unilateral action to permanently remove furniture which, in any case, the tenants did without communicating the need for this.

30. Finally, should it be deemed that any of the issues raised are compensable despite the foregoing, I assert that any quantum of loss experienced by the tenants should be negated by losses experienced by the lessor due to the tenants' use of the property for commercial purposes. The tenants' submission states that their decision to select the property was based primarily on their intention to use it for exhibitions to "major art buyers". Whether informal or not, I contend that this constitutes commercial use, for which higher rent would otherwise be payable on a commercial lease, in recognition of wear and tear on the property extending beyond residential use.

The landlord's statement was accompanied by copies of the annexures referred to in the statement.

On 17 March 2009 Mr Watson appeared in person and there was no appearance of the landlord despite attempts to ring him on the number provided by him in the Australian Embassy in Tokyo. The Tribunal made an order exparte terminating the tenancy on 20 March 2009 with the balance of the claim to be adjourned. The Tribunal made this exparte order on the basis of the landlord's consent conveyed in his letter of 23 February 2009 and in his submissions filed in the proceedings.

The Tribunal made procedural orders for the parties to file and serve the evidence relied upon in respect of the balance of the claim.

The matter was then listed again before the Tribunal on 15 April 2009.

On 17 March 2009 the landlord applied to set aside the exparte order on the basis that the Tribunal did not contact him on the phone number provided. This application was also listed for hearing on 15 April 2009.

On 31 March 2009 the tenants filed and serve the following further submission:

Tenants phoned Agents (Strictly Rentals) advising leaks in ceiling of dining room, Strictly Rentals undertook to have a repair contractor inspect the problem.

Tenants emailed Strictly Rentals advising 'further water entering the ceiling' and attached digital images of 'cricket ball size water bubble' in ceiling paint

Tenants' further communication with Strictly Rentals regarding attendance by contractor. Duncan's Plumbing subsequently inspected the property.

Tenants' phone call to Strictly Rentals enquiring of progress and outcome of inspection by Duncan's Plumbing.

Routine property inspection by Strictly Rentals. The leaking ceiling issue was again raised and the deteriorating floor (lifting floor finish) condition from water splashing out of buckets etc pointed out to the agents.

Tenants' further communication with Strictly Rentals and Duncan's Plumbing who again inspected the property to give another opinion.

Tenants' letter to Strictly Rentals advising of worsening condition of the ceiling leak.

Tenants telephone conversation with newly appointed agents (Kouvelis Real Estate) advising them of the long term ceiling leak. Full copies of correspondence were emailed to Kouvelis Real Estate.

Email from Kouvelis Real Estate, stating that the Lessee was 'quite shocked' and not aware that the problem remained unresolved.

Email from Kouvelis Real Estate, advising that repairs were now complete.

May 26-27 Following the first experience of rain leaking through the dining room ceiling we removed our 8 seat dining table and chairs to the adjacent hallway to remove any risk of damage if there was further rain water entry. The tenants were due to participate as exhibitors at a Brisbane Art Fair the following day and were to be absent from the property for 8 days.

On returning from Brisbane (June 6) we moved the dining suite to the downstairs garage as a precaution and to await the arrival of the proposed inspection.

This loss of use of the dining room and the need to have rainwater catching receptacles (buckets, basins and splash towels) on hand for any further rain caused considerable stress, inconvenience and was unsightly.

In particular, the loss of the use of the dining room removed any possibility for the formal entertainment of business associates, friends and family. Mrs Watson has extensive culinary skills and a library of over 50 cookbooks collected over a period of 40 years, attesting to her interest and enjoyment in cooking and entertaining. The loss of the ability to use the dining room for entertaining, in particular, removed much of the potential pleasure, enjoyment and functionality in the use of the property by the tenants.

As detailed in the Claim, the Watsons own and operate an art gallery in commercial premises in Braddon. During the period of the claim, eight exhibition openings took place at the gallery and in normal circumstances the featured artists, special clients and friends would have been entertained at their home premises with a formal dining evening. In these circumstances, the alternative entertainment/dining option was to attend a restaurant at an expense of $400-$600 on each occasion.

Can you please advise the obligation on the tenants to pay rent on the property for the period of the required three weeks notice (ending 23 March) or until the date of the termination order (March 20) the day the property was actually vacated in accordance with a Court Order.

We wish to add to our claim the cost of the RTT Application Fee of $112.00. the claim was made at the request of the Lessee to determine the level of compensation to be paid.

1. On 15 April 2009 the tenants appeared in person and the landlord appeared by phone. It transpired that the landlord had not received the tenants' submission of 31 March 2009. After discussion with the parties it was agreed that the landlord would have the opportunity to respond to the tenants' submissions of 31 March 2009 and the tenants would have the opportunity to reply after which the matter would be determined by the Tribunal on the papers. Procedural orders were made to this effect.

2. On 1 May 2009 the landlord filed his submissions which read:

RESPONSE TO ADDITIONAL INFORMATION PROVIDED BY CLAIMANTS, DATED 31 MAR 09

1. The history of the ceiling leak as outlined in this second document is not substantially different to the original submission, although the attendance by plumbers to investigate the problem is now acknowledged by the tenants.

2. The claim of damage to the floor is new. This has not been reported previously and there is no evidence of such damage. Nor is there clear evidence presented that the tenants' assessment of the gravity of the problem, or the disruption to their use of the room, was clearly communicated to the lessor's agent. There is no reason to believe that, had the tenant's communicated the apparent gravity of the problem to the agent, that the agent would not have relayed this to the lessor. Yet there was no indication from the agent to the lessor that the problem was as grave as was subsequently described by the tenants.

3. The first clear articulation of the extent of the apparent inconvenience being suffered by the tenants remains their letter of December 22. as noted in my original submission, the problem was rectified via the engagement of a new contractor as soon as could be arranged thereafter. The lessor was indeed "quite shocked", as communicated in January, as prior to this there had been no such description of the tenant's claimed inconvenience.

4. The nature and extent of the inconvenience claimed by the tenants, as described in their submission, could have been avoided had they made this inconvenience known to the lessor prior to December 22.

5. with regard to the lease termination date, the tenants advised in writing of their intention to vacate the property on 23 March and rent was calculated in accordance with this request. The tenants' subsequent decision to vacate the property 3 days prior to this date was their own. Rent should therefore be payable in accordance with their original undertaking, to which the lessor had agreed. The written advice from the tenant advising their intention to vacate on 23 March is attached.

6. Regarding the claim for "refund" of the claimant's tribunal application fee, for the reasons outlined in my original response, I do not believe that compensation is warranted and, in any case, the lessees' claim is ambit in nature. The lessee should therefore remain liable for the cost of the proceedings.

1. On 8 May 2009 the tenants filed their reply which read:

Response to Lessors comments to Claimants' summary of Ceiling Leaks and Nature and Extent of Inconvenience.

The Lessor's property agents who attended property inspections and later, maintenance contractors who attended the property were aware of the presence of buckets and basins to collect leaking water and that the dining furniture was not in the room.

The tenants had no knowledge of what information was conveyed to the Lessor by the property agents and none of this communication and correspondence has been provided to the Tribunal by the Lessor that supports the Lessor's contention that the Lessor was not aware of the ongoing problems.

The Lessor has not provided any inspection reports and or recommendations or accounts for attendance by the maintenance contractors following their attendance at the property that supports the Lessor's contention that there was no cause for alarm or concern.

The Tenants have never had any direct communication with the Lessor and had no knowledge of the Lessor's whereabouts, postal address or phone numbers. All communication by the Tenants was with the Lessor's agents.

1. The relevant legislation by reference to which this matter is to be determined is set out in the annexure to these reasons for decision.

The tenants suggested that by virtue of what appeared to be a old wet patch on the ceiling of the dinning room when the tenancy commenced that the leaking roof was an existing problem of which the landlord must have been aware at the time. The landlord's evidence was to the effect that the patch had been on the ceiling for years and that there had never been any leak that they were aware of.

Prescribed term 54 requires the landlord to provide the premises in a reasonable state of repair at the commencement of the tenancy. The existence of an historical patch on the ceiling of a the living room is not of it's a breach of prescribed term 54.

Prescribed term 55(1) requires the landlord to maintain the premises in a reasonable state of repair during the tenancy. Prescribed term 55(2) requires the tenants to notify the landlord of the need for any repairs. The traditional approach taken to prescribed term 55 and its equivalent provisions in other jurisdiction is that the landlord's duty to maintain the premises during the lease (as opposed to the duty to provide the premises in a reasonable state of repair at the commencement of the tenancy) is dependant on the landlord being put on notice of the need for the repair (Residential Tenancies Law and Practice in NSW 4th ed Anforth and Christensen at [2.25.2]-[2.25.3]).

The tenants' evidence is that the leak occurred on 28 May 2008 and was reported to the landlord's agent on that day. The tenants then contacted the landlords agent about the problem on each of the dates set out in paragraph 13 above. The repairs were not effected until 21 January 2009.

The tenants maintained that they lost the use of the dinning room and lost the opportunity to entertain guests for dinner. The tenants did not say that they had no use of the dinning room and nor do they maintain that regular rain was a problem throughout this period of drought in Canberra. The landlord reported that the tradesmen sent to carry out the repair reported that there was furniture and other property of the tenants in the dinning room.

A period of some 34 months is an excessive time to carry out the repairs, especially as prescribed term 57 allows only 4 weeks for non-urgent repairs of notification. The landlord admits so much when he wrote "the lessor acknowledges that the roof repairs could have been carried out more quickly". The landlord is thus in breach of his contractual duty under prescribed terms 55 and 57.

The landlord contends that the tenants failed to mitigate their losses as required by section 38 of the Act and by the common law, in that the tenants did not sufficiently harass the landlords agent and did not commence proceedings in the Tribunal until February 2009. The tenants brought the matter to the attention of the landlord's agent on 8 occasions before the repairs were carried out. This is sufficient harassment, the fault lay entirely with the landlord and/or the landlord's agent.

The landlord contends that the tenants have overstated the extent of the inconvenience suffered. To the extent that the tenants maintain that they have lost the whole of the use of the dinning room, the Tribunal is satisfied that the tenants have overstated their case.

Rain was not a common phenomenon in the period in question and it was not common for rain to come suddenly and unexpectedly upon the Canberra community. There would not seem to be any reason that the tenants could not have put their dinning table in the dinning room and entertained on all but a small number of days.

The tenants speak of "inundation" of the dinning room. The evidence of the landlord's tradesmen is that it was more like a trickle when there was rain. If there had been inundation then it would be expected that the carpets and floors would have suffered in the dinning room and possibly in the adjacent rooms.

The Tribunal has formed the impression that the tenants grievance, although real, was driven by a sense of emotional irritation rather than by any substantial physical inconvenience suffered. Nevertheless the quiet enjoyment of the premises is what the tenants contracted for and so the emotional factors are relevant to this extent in assessing the level compensation payable (Residential Tenancies Law and Practice in NSW 4th ed Anforth and Christensen at [2.16.1]).

1. The dishwasher was defective at the commencement of the tenancy and the landlord is taken to have had notice of any such defects as he could have discovered by a non-expert inspection of the premises at the commencement of the tenancy i.e. turn the dishwasher on and see if it works (Residential Tenancies Law and Practice in NSW 4th ed Anforth and Christensen at [2.25.2]). The landlord is thus in breach of prescribed term 54.

2. The dishwasher was not repaired until 8 May 2008.

1. The lights and the back door lock were defective at the commencement of the tenancy and the landlord is taken to have had notice of any such defects as he could have discovered by a non-expert inspection of the premises at the commencement of the tenancy, eg by turning on the lights to see if they work and testing the lock (Residential Tenancies Law and Practice in NSW 4th ed Anforth and Christensen at [2.25.2]). The landlord is thus in breach of prescribed term 54.

2. The lights was not repaired until 6 August 2008 and the lock was not repaired until 11 June 2008.

1. The tenants complained that the gardens were in a dishevelled state at the commencement of the tenancy. Unfortunately there is no requirement at law that the gardens be delivered in any state other than that required by prescribed term 54(1)(b) i.e. reasonable clean. Beyond this garden maintenance is a tenant's responsibility. Therefore to the extent that the tenants complain that the garden was in a poor state at the commencement of the tenancy, there is no breach. The tenants could see the state of the garden when they inspected the premises and had the choice of accepting the premise or not at that time.

2. The tenants complain that the endorsed term of the tenancy agreement provided for a gardener to come once a quarter "to maintain the shrubs and trees". The endorsed term did not require the gardener to carry out general gardening or maintenance work, he was only required to maintain the shrubs and trees.

3. The tenants' evidence is that the gardener came only once during the period of the tenancy and that the shrubs were a problem down the battle axe driveway. To this extent the landlord is in breach of the endorsed term.

Section 71 provides the Tribunal with power to order a retrospective rent reduction where the tenants' quiet enjoyment of the premises has been "diminished significantly" by reason of the landlord's failure to carry out repairs with the resultant loss of facilities or services in the premises.

The Tribunal also has power to order compensation in the form a lump sum of money for breach of a term of the residential tenancy agreement (section 104(1)(d)). Whereas section 71 requires that there have been a "significant" loss of quiet enjoyment, section 104(1)(d) contains no similar qualification.

As a general rule the Tribunal tends to utilise section 71 and award compensation by way of rent reduction whilst the tenancy is still in existence, and to use section 104(1)(d) to provide for lump sum compensation where the tenancy has terminated. In the present case the Tribunal proposes to proceed via section 104(1)(d).

The assessment of the appropriate compensation is one for judgement by the Tribunal upon which reasonable minds may differ. In general the Tribunal is guided by reference to decision in comparative cases although is not bound by such cases and must have regard to the particular circumstances of the case in hand. A list of comparative judgment can be found at [2.16.2] Residential Tenancies Law and Practice in NSW 4th ed Anforth and Christensen.

The matters to be compensated are: * (a) a modest partial loss of use of the dinning from for 34 weeks * (b) a loss of the dishwasher for 2 weeks * (c) a loss of the lighting for about 19 weeks * (d) a loss of the back door lock for about 7 weeks * (e) a loss of the gardener for 3 of the 4 quarterly visits during the tenancy.

In coming to the assessment of compensation the Tribunal re-iterates its finding of fact that whilst the inconvenience to the tenants was significant, the tenants have overstated the extent of their inconvenience. The Tribunal allows compensation in the sum of $3700.00 by reference to paragraph 43 as follows: * (a) $3000.00 * (b) $100.00 * (c) $200.00 * (d) $100.00 * (e) $300.00

The Tribunal also allows the $112.00 application fee (section 48(2)(a) ACT Civil and Administrative Tribunal Act 2008 (ACT)).

It appears that a dispute has also arisen between the parties over the effect of the order made for the termination of the tenancy to occur on 20 March 2009. The tenants in fact vacated on this date in accordance with the order of the Tribunal and the tenancy agreement thereby came to an end on that date together any obligation to pay rent. Consequently no rent is payable beyond this date.

The Tribunal has not been appraised of any dispute concerning the state of the premises when possession was returned to the landlord on 20 March 2009 and thus is unaware of any rental bond dispute. In these circumstances the Tribunal orders the Office of Rental Bond to return the whole of the bond to the tenants.

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Residential Tenancies Act 1997:

30(1) If section 29 (1) and (3) have been complied with, a statement in a report mentioned in section 29 about the state of repair or general condition of the premises, and of any goods leased with the premises, (other than a statement in relation to which the tenant, by endorsement, has indicated disagreement) is evidence of that state of repair or general condition on the day the tenant was given the report.

38. A person who, apart from this section, would be entitled to compensation under this Act is not entitled to the compensation, or part of it, if the loss, or part of the loss, to be compensated could have been reasonably avoided.

71(1) On application by a tenant, the tribunal 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 tribunal specifies; and

(b) remains in force for the period, not longer than 12 months, specified by the tribunal.

(4) The tribunal 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.

104. The tribunal may, in addition to any other order it is empowered to make, make the following orders in relation to an application about a tenancy dispute or occupancy dispute:

(b) an order requiring performance of a residential tenancy agreement or occupancy agreement;

(c) an order requiring the payment of money to the Territory or a person;

(d) an order requiring the payment of compensation for loss of rent or any other loss caused by the breach of a residential tenancy agreement or occupancy agreement;

(i) an order terminating a residential tenancy agreement or occupancy agreement and granting vacant possession of the relevant premises to the applicant for the order;

(l) any other order the tribunal considers appropriate.

115(1) The tribunal has exclusive jurisdiction to hear and decide any matter that may be the subject of an application to the tribunal under -

Note A reference to an Act includes a reference to the statutory instruments made or in force under the Act, including any regulation (see Legislation Act, s 104).

(2) However, the tribunal does not have jurisdiction to make an order for -

(a) the payment of an amount greater than $25 000; or

120(1) If this Act does not prescribe a procedure for a matter in a hearing or a step in a proceeding, the tribunal may decide its own procedure for the matter or step.

121(1) In the exercise of a function, the tribunal must have regard to the rules of natural justice.

(a) must proceed with as little formality and technicality and with as much expedition as the requirements of this or any other Act and a proper consideration of the matter allow; and

(b) is not bound by rules of evidence but may inform itself of any matter in any way it considers appropriate.

Prescribed terms of the Schedule to the Act forming the terms of the residential tenancies agreement:

3. A party to this tenancy agreement cannot contract out of it or out of the provisions of the Residential Tenancies Act, except as provided in that Act.

52 The lessor must not cause or permit any interference with the reasonable peace, comfort or privacy of the tenant in the use by the tenant of the premises.

53. Unless otherwise agreed in writing, the tenant has exclusive possession of the premises, as described in the agreement, from the date of commencement of the tenancy agreement provided for in the agreement.

54(1) At the start of the tenancy, the lessor must ensure that the premises, including furniture, fittings and appliances (unless excluded from the tenancy agreement), are -

55(1) The lessor must maintain the premises in a reasonable state of repair having regard to their condition at the commencement of the tenancy agreement.

(2) The tenant must notify the lessor of any need for repairs.

(3) This section does not require the tenant to notify the lessor about anything that an ordinary tenant would reasonably be expected to do, for example, changing a light globe or a fuse.

56 The lessor is not obliged to repair damage caused by the negligence or wilful act of the tenant.

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).

59. The tenant must notify the lessor (or the lessor's nominee) of the need for urgent repairs as soon as practicable, and the lessor must, subject to clause 82, carry out those repairs as soon as necessary, having regard to the nature of the problem.

1. The following are urgent repairs in relation to the premises, or services or fixtures supplied by the lessor:

(j) a failure or breakdown of any service on the premises essential for hot water, cooking, heating or laundering;

61 If the lessor (or the lessor's nominee) cannot be contacted, or fails to effect the urgent repairs within a reasonable time, the tenant may arrange for urgent repairs to be effected to a maximum value of up to 5% of the rent of the property over a year.

62 The following procedures apply to urgent repairs arranged by the tenant:

(a) the repairs arranged by the tenant must be made by the qualified tradesperson nominated by the lessor in the tenancy agreement;

(b) if the lessor has not nominated a tradesperson, or the nominated tradesperson cannot be contacted or is otherwise unavailable - the repairs must be performed by a qualified tradesperson of the tenant's choosing;

(c) if the repairs are arranged by the tenant in accordance with these procedures - the lessor is liable for the cost of repairs and the tradesperson may bill the lessor direct;

(d) if the tenant does not act in strict compliance with this clause - the tenant is personally liable for the cost of any urgent repairs arranged by the tenant.

(a) not intentionally or negligently damage the premises or permit such damage; and

(b) notify the lessor of any damage as soon as possible; and

(c) take reasonable care of the premises and their contents, and keep them reasonably clean, having regard to their condition at the time of the commencement of the tenancy and the normal incidents of living.

DATE/S OF HEARING: 15 APRIL 2009 PLACE: CANBERRA

DATE/S OF DECISION: 12 JUNE 2009 PLACE: CANBERRA

FULL REPORT ( ) CASE NOTE ( ) UNREPORTED DECISION ( )