Watson v Powers

(1) The landlord is to pay the tenants $11,400.00 as a rent abatement due to mould.

(2) The Tribunal found that the reasonable rent was $430 per week and in effect ordered a rent reduction for a 12 month period as above.

1. The landlord filed a Notice of Appeal on 1 October 2024.
2. Rule 25 of the Civil and Administrative Tribunal Rules 2014 (NSW) (NCAT Rules) provides that in the case of an appeal made in residential proceedings it must be lodged within 14 days from the day on which the appellant was notified of the decision (which in this case was 12 October 2023).
3. The appeal was therefore lodged more than 11 months late.
4. Accordingly, the first issue for determination is whether or not the Appeal Panel should extend time for filing the appeal under s 41 of the NCAT Act.
5. The Appeal Panel will address this issue in more detail shortly.
6. In the Notice of Appeal, the landlord seeks leave to appeal the decision on the grounds that the decision was not fair and equitable and as such he may have suffered a substantial miscarriage of justice.

1. At a call over hearing on 16 October 2024 directions were made to prepare the appeal for the filing and service of documents and submissions.
2. In addition to the Notice of Appeal the landlord has filed submissions on the following dates:

(1) 11 October 2024;

(2) 18 November 2024;

(3) 13 December 2022 (a routine inspection report).

1. The tenants have filed the following documents and submissions:

(1) Reply to Notice of Appeal on 15 October 2024;

(2) Submissions on 14 October 2024 and 3 December 2024;

(3) A sound recording of the hearing on USB;

(4) A further submission on 6 December 2024.

1. An appeal to the Appeal Panel is not an opportunity for an unsuccessful party in the Tribunal below to be given another opportunity to run their case again: Ryan v BKB Motor Vehicle Repairs Pty Ltd [2017] NSWCATAP 39 at [10].
2. There is a right of appeal on a question of law and otherwise with the leave of the Appeal Panel: s 80(2)(b) of NCAT Act.
3. The landlord has not identified a ground of appeal that would constitute an error on a question of law but relies on the ground that the decision was not fair and equitable.
4. The circumstances in which the Appeal Panel may grant leave to appeal from decisions made in the Consumer and Commercial Division are set out in Clause 12(1) of Schedule 4 of the NCAT Act.
5. The basis that the Decision was not fair and equitable is set out in Clause 12(1)(b) of Schedule 4 and leave is required.
6. The principles surrounding leave to appeal are set out in Collins v Urban [2014] NSWCATAP 17.

1. Section 41 of the NCAT allows the Appeal Panel to extend time for the filing of an application.
2. The relevant principles for considering an extension of time application are set out in Jackson v NSW Land and Housing Corporation [2014] NSWCATAP 22 at [22].
3. The relevant factors which have been addressed at the hearing are the length of the delay, the reasons for the delay, whether the appellant has a fairly arguable case and the extent of any prejudice suffered by the respondent.
4. We have had regard to a number of cases such as the High Court's decision in Gallo v Dawson [1990] HCA 30; (1990) 64 ALJR 458 at 459 F-G (col 1), in which McHugh J stated:

When the application is for an extension of time in which to file an appeal, it is always necessary to consider the prospect of the applicant succeeding in the appeal.

1. It may be appropriate to go further into the merits of an appeal if the explanation for the delay is less than satisfactory or if the opponent has a substantial case of prejudice and, in such a case, it may be relevant whether the appellant seeking an extension of time can show that his or her case has more substantial merit than merely being fairly arguable (Tomko v Palasty (No 2) [2007] NSWCA 369; (2007) 71 NSWLR 61 at [14] (per Hodgson JA, Ipp JA agreeing at [17]).
2. In Gallo v Dawson McHugh J stated at 459E:

A case would need to be exceptional before a Court would enlarge by many months the time for lodging an appeal simply because the applicant had refrained from appealing until he or she had researched the issues involved.

1. The discretion to extend time can only be exercised in favour of an applicant upon proof that strict compliance with the rules would work an injustice upon the appellant (Gallo v Dawson [1990] HCA 30, 93 ALR 479 at [2]; Nanschild v Pratt [2011] NSWCA 85 at [38]).

Landlord's submissions regarding extension of time

1. The landlord made the following submissions in relation to the extension of time application.

1. In oral submissions Ms Poulson stated that the landlord was 'shocked' to receive the Member's order for payment of $11,440.00 due to a rent abatement.
2. In mid November 2023 the landlord had received a certified money order and in January 2024 the tenants filed proceedings in the Local Court to enforce the money order.
3. By way of explanation for the delay the agent stated that the landlord and agent were not aware of the appeal process and had no experience of appeals in the Tribunal and that:

'we chose to apply the arrears to the money order'.

1. It was not until September 2024 that the Sheriff's office told the landlord to lodge an appeal and accordingly the Notice of Appeal was lodged quickly thereafter.

1. The length of the delay is significant, and the landlord made no specific submissions regarding the extent of the delay but did not contest that the delay was lengthy.

1. The landlord submitted that the decision was not fair and equitable because the Member failed to offset the rent arrears against the rent reduction and rent refund order.
2. In its written submissions the landlord also claimed:

(1) There was no 'tangible' evidence that certain areas of the house were unusable because of mould;

(2) The tenant did not raise the issue of mould until about the beginning of July 2023;

(3) If mould existed the tenants failed to provide evidence that it was directly attributable to the landlord;

(4) If mould was present it was due to the tenants' failure to take reasonable precautions to treat the mould;

(5) The tenants did not vacate until 21 November 2023;

(6) At the time of the Tribunal hearing on 10 October 2023 the tenants owed rent arrears of $7,614.29;

(7) At the date of providing vacant possession the tenants 'would have' owed $11,514.29;

(8) The landlord applied the $11,440.00 awarded to the tenants by the Tribunal as a credit to the unpaid rent;

(9) The Member mistakenly believed there was an agreement that the tenants were not to pay rent from 14 July 2023; in fact there was no rent free period offered by the landlord;

(10) The Member did not take into account the rent arrears when making the money order in favour of the tenants;

(11) The Member erred in assuming that the failure of the tenants to vacate immediately or in reasonable time was compensable by the landlord.

1. The landlord did not make submissions in this regard.

Tenants' submissions regarding extension of time

1. The tenants made the following submissions in reply to the extension of time application:

1. The appeal was vexatious and a method to avoid paying the compensation order made by the Tribunal.
2. The legal proceedings have caused the tenants and their families significant financial, physical and mental health issues.
3. The tenants have not received the benefit of the money order due to the lengthy enforcement procedures in the Local Court.

1. The tenants did not accept the landlord's explanation for the delay.
2. They submitted that, like the landlord and agents, they have no legal training but were able to navigate the legal process.
3. Further, the tenants pointed to an email from the tenants to the landlord dated 21 December 2023 inviting the landlord to claim any money owed through the Tribunal.
4. Nevertheless, the appeal was not filed for a further 10 months.

1. The transcript confirms that the parties agreed that no rent was payable nor owing.
2. The transcript shows that Member understood that no rent was payable unless a new tenancy agreement was entered into, which it was not.
3. The Hearing Notes completed by the agent and submitted to the Tribunal at the hearing note that $0 in arrears were claimed.
4. Correspondence from the agent in July and August 2023, prior to the hearing, confirmed that the tenants were not required to pay rent.
5. The consent orders in related matter RT 23/36529 state that the order for possession was suspended until 24 October 2023 and provided the landlord with a 60 day relisting, should he seek to claim arrears, which was not done.

1. The Appeal Panel is satisfied of the following:

(1) The 11 month delay in lodging the appeal was very significant and there was no reasonable explanation for the landlord's delay.

(2) The landlord was on notice since at least mid November 2023 that the tenants intended to enforce the money order.

(3) Even a cursory glance of the Tribunal's website would have informed the landlord or his agent of the appeal process and time limits.

(4) The prejudice of the delay to the tenants is substantial. After the Tribunal orders of 12 October 2023, they had a reasonable expectation that the dispute was finalised, an expectation they maintained for nearly a year. While the landlord delayed in bringing the appeal, the tenants have incurred expenses and time in enforcement proceedings against the landlord in the Local Court.

1. We now turn to the merits of the appeal as one of the factors to be considered in determining whether time should be extended for filing the appeal.
2. We consider that the merits of the appeal are poor, and the landlord does not have a fairly arguable case that the Decision was not fair and equitable.
3. The Tribunal has made a money order of $11,440.00 which both parties agree was calculated as a reduced amount of rent by $220.00 per week for 52 weeks.
4. It is only this money order that is the subject of this appeal, not the tenants' compensation claims which appear to have been dismissed, nor the termination orders which were made in related proceedings.
5. We are satisfied that the rent reduction was determined by the Member for the period from on or about 15 July 2022 to 14 July 2023. This is supported by the following:

(1) Page 41 of the transcript at 2:17-2:45 notes that the tenants said in effect that they were seeking reduced rent from $650.00 to be applied from July 2022;

(2) An email from the property agent (who was present at the hearing before the Tribunal) to the tenant dated 12 December 2023 says: 'Tribunal offered a rent abatement of $11,400.00, being a reduction of $220.00 per week from $650 to $430 applied over 52 weeks from 14 July 2023.'

(3) At the appeal hearing the agent said that the reference to 14 July 2023 was a typographical error and should have been 14 July 2022, being 12 months to the date of vacant possession set out in the termination notice dated 13 July 2023;

(4) The tenants said at the appeal hearing that the period of time for the rent reduction was 14 July 2022 to 14 July 2023.

1. Although the Tribunal Member did not make an express order for a rent reduction under s 44(1)(b) of the RT Act, in his reasons he finds that the reasonable rent to be charged is $430 per week which he applied over a 12 month period.
2. The Tribunal Member then made a money order of $11,440.00 which in effect is a refund of rent for the 12 month period of $220.00 per week, being the difference between $650 and $430.
3. The landlord contends that order is not fair and equitable because the Member failed to take into account the rent arrears which were owing as at the date of the hearing, being 10 October 2023. The landlord also contends that an occupation fee was owed until vacant possession on 21 November 2023.
4. The landlord's agent said at the appeal hearing that as at 14 July 2023, the tenants were in advance of their rent obligations by several days. In other words, there were no rental arrears as at 14 July 2023 for the money order to take into account.
5. The issue of rent arrears between 15 July 2023 and 10 October 2023 and thereafter the occupation fee to the date of vacant possession on 21 November 2023 is not relevant to this appeal as the Tribunal's determination was for the rent arrears owing in the period 14 July 2022 to 14 July 2023.
6. The agent confirmed that the landlord has not, to date, filed any application for rent arrears or the occupation fee for the period from 15 July 2023. We note also that the transcript indicates that the landlord's agent did not assert a claim for rent arrears at the hearing.
7. It follows from the above that the landlord does not have a fairly arguable case that the decision was not fair and equitable such that he may have suffered a substantial miscarriage of justice.
8. In conclusion, taking into account the very lengthy delay in lodging the appeal, the less than satisfactory explanation for the delay, the significant prejudice to the tenants, and the lack of merit of the appeal, we are not satisfied there are grounds for extending the time for filing of the Notice of Appeal by the many months required in this case.
9. Further, we are not satisfied that strict compliance with the rules in the circumstances of this case would work an injustice upon the landlord.

(1) Leave to extend time for filing of the appeal is refused.

(2) The appeal is dismissed.

I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales.