Yates & Anor v Littlee Properties Pty Ltd [2020] QCAT 508

Cain v Daudet [2020] QCATA 78

Kenny v Preen [1962] EWCA Civ 2; [1963] 1 QB 499

Stone v Grundy [2018] QCATA 68

Underwood v Queensland Department of Communities (State of Queensland) [2012] QCA 158

• [1] The applicants are the tenants of a part of a rural property situated in the Moreton Bay Regional Council area under the terms of a General Tenancy Agreement that commenced 1 April 2019 and is due to expire 31 March 2021.
• [2] The property described as [redacted] was, at all material times, situated on one title, and comprised 23 acres or 86,560m2 or thereabouts.[1]
• [3] A dispute has arisen over what the area of the tenancy within the 23-acre property actually comprised:

(a) The applicants say the tenancy was for the two-acre lot containing the house they occupy and a shed, the latter of which they agree they had shared use of with the original lessor.

(b) The respondent says the tenancy was for the house and the "15m-20m" surrounding it, and for shared access to the shed, which is less than the two acres the applicants claim.

• [4] The relevance of this, is that by 19 May 2020 the respondent had cleared trees, gardens and fences from the two-acre lot; the applicants say this intruded upon the area subject to the tenancy, disrupted their quiet enjoyment and interfered with the amenity of the property they lease. The respondent says the works were undertaken on land that did not form part of the tenancy.
• [5] The applicants seek orders for:

(a) The respondent to reinstate all fences to the side and rear of the property to the state that they were in as at 19 May 2020 (the respondent consents to this);

(b) The respondent to "make good" the fenced area behind the house on the property, by filling in all holes created by the removal of trees and fence posts, and levelling the round with a roller or similar (the respondent consents to this);

(c) The respondent to remove all soil and building materials deposited within the boundaries of the area covered by the Residential Tenancy Agreement dated 29 March 2019 (the respondent consents to this); and

(d) The rent to be reduced by $250 per week or such other sum as the Tribunal may consider appropriate, such reduction to take effect from 19 May 2020 or such other date as ordered by the Tribunal (this is disputed by the respondent).

• [6] The "List of Claims" in the application seeks "$25,000" as the total amount of the claim. As, mathematically, the rent reduction sought amounted, at best, to just over $10,000, the applicants clarified that they were seeking an amount over and above the rent reduction as compensation for the anxiety and stress the respondent's actions have caused the tenants, up to the Tribunal's monetary jurisdiction. They later added claims for legal costs and other expenses.
• [7] The respondent disputes the rent reduction claimed and says that a sum of $50 per week for the period during which fences were removed and construction works were being undertaken is sufficient compensation to the applicants for any loss of amenity as a result.

• [8] The original property owners (and original lessor under the tenancy) were Mr and Mrs Phillips.
• [9] Mr and Mrs Phillips intended to develop their land by subdivision and had filed and progressed their development application with the local authority years prior to their involvement with the applicants.
• [10] That application sought to create twenty-three separate lots (and a reserve for a drainage basin) on the property. Twenty-two of the proposed twenty-three lots were 3,000m2 lots and the final lot, proposed lot 6, was to be 7,531m2 (roughly two acres), on which their home and shed were situated.
• [11] In 2019 Mr and Mrs Phillips engaged real estate agents to advertise and lease the house block with shared use of the shed. Lisa Perro acted as the leasing and managing agent at the time.
• [12] The applicants were the successful applicants to lease the property and they entered into a General Tenancy Agreement with Mr and Mrs Phillips that commenced 1 April 2019 and is due to expire 31 March 2021.
• [13] The Agreement, signed by the tenants and Ms Perro as lessor's agent on 29 March 2020, included the following relevant terms (emphasis added):

(a) In Part 1, Item 5.1 that the address of the rental premises is [redacted];

(b) In Item 5.2 that the inclusions provided were "as per entry condition report and photos";

(i) A reference to "the premises" includes a reference to any inclusions for the premises stated in this agreement for item 5.2;[2]

(ii) A duty or entitlement under the Act (being the RTRAA) overrides a standard term or special term if the term is inconsistent with the duty or entitlement;[3]

(iii) A standard term overrides a special term if they are inconsistent;[4]

(iv) Under Section 94, the rent may decrease in certain situations;[5]

(v) That the lessor must ensure the tenant has vacant possession of the premises (other than a part of the premises that the tenant does not have a right to occupy exclusively) on the day the tenant is entitled to occupy the premises under this agreement. [Parts of the premises where the tenant does not have a right to occupy exclusively may be identified in a special term];

(vi) The lessor must take reasonable steps to ensure the tenant has quiet enjoyment of the premises;

(vii) The lessor or the lessor's agent must not interfere with the reasonable peace, comfort or privacy of the tenant in using the premises;

(d) In Special Term 5 that "Tenants are aware that all lawn & garden maintenance is included in the rent";

(e) In Special Term 6 that "Tenants are aware that they have use of 1 bay in the shed"; and

(f) In Special Term 7 that "Tenants are aware that they have the use of the immediate surrounds of the house only".

• [14] It not disputed that the intention of both parties was to lease the house, an area around it and part of the shed, not the entire 23-acre property, and that there might be some disruption to the tenants whilst Mr and Mrs Phillips developed the remaining land around the tenancy.
• [15] Ultimately, Mr and Mrs Phillips declined to proceed with the development themselves and instead sold the project/property to the respondent in or about May 2020. The property was sold encumbered by the applicants' tenancy.
• [16] The respondent promptly proceeded with the development of the property by commencing clearing and earthworks on 8 May 2020.
• [17] The applicants sought dispute resolution assistance from the RTA on 11 May 2020 and received a Notice of Unresolved Dispute (conciliation not conducted) dated 17 July 2020.
• [18] The application was filed on 23 July 2020 and amended 11 August 2020.

• [19] The applicants said at the hearing that:

(a) They responded to an advertisement for the property and inspected and negotiated the terms of the tenancy with Trevor Phillips and with his then leasing agent, Lisa Perro;

(b) They understood at all times that they were only leasing two acres and that the other 21 acres around them would, or may, be developed during the tenancy;

(c) The two acres was clearly fenced to identity the leased area and that 600 entry photographs were taken, of which they rely upon 45 or so, including extensive photographs of the yard indicating the boundary of the leased property;

(d) The gardens, trees, fences and lawn have been removed and their privacy and security impacted by trespassers; and

(e) The impact on their mental health and wellbeing has been substantial.

• [20] The applicants produced a letter written by Lisa Perro, property manager at the time the tenancy agreement was entered into, dated 23 July 2020 wherein she states:

The tenants were aware that the property was being subdivided and that they had the house from the fence directly to the front of the house to the fence line behind the shed which was roughly 2 acres. They rented the property for $650 per week which included lawn and garden maintenance.

They also shared the shed with the owner at the time Trevor Phillips_._

• [21] The applicants also produced an email from Vicki Mackay, Woodford Property dated 14 July 2020 directed to the tenants wherein Ms Mackay says:

I have looked all through your file and there is nothing saying it was on 2 acres. Only that the house came with the surrounding land Going by the plan of the development, the house is on 2 acres. So therefore I assume the developer is realigning the fences to suit... Going on rentals in Woodford $650 per week in my opinion would include acreage.

• [22] The applicants say the respondent has gone well beyond what is reasonable to undertake the development works that were contemplated at the commencement of the tenancy. They produced photographs evidencing the destroying by way of bulldozing/earth moving to remove trees, fences and gardens within the immediate vicinity of the house and certainly well within the two-acre lot they believed formed the area of their tenancy. They are seeking compensation for that intrusion.

• [23] The respondent produced a letter from Trevor Phillips dated 19 July 2020[6] wherein Mr Phillips, inter alia, says:

Thank you for asking me to define what our intentions were when we originally leased the house at [redacted] to Rick and Beryl Yates (the tenants). We specifically rented 'the immediate surrounds of the house only' to the tenants, as is stipulated in the Special Condition 7 of the signed tenancy agreement.

For clarity, we defined 'the house and its immediate surrounds' to be the actual house and the established landscaped gardens surrounding it, including the 120 square metres of fully fenced front lawn that is directly adjacent to the front door of the house.

...

Due to the overall size of the property and our ongoing property maintenance activities we agreed to maintain and be responsible for 'all lawn and garden maintenance' (Special Condition 5) as it represented only a small percentage of the overall maintenance activities required.

• [24] The respondent produced a further statement by Mr Phillips dated 5 August 2020 in which Mr Phillips, inter alia, says (emphasis added):

(a) That when the tenancy was entered into in April 2019 "our development application had been approved...and as such the tenancy agreement... had clauses in it to allow a development of the property during the term of the tenancy";[7]

(b) That "the development contemplated that the existing house on the property would remain as would the shed and the property would be developed in such a way that one of the approved lots in the subdivision would be a lot which contained the house and shed";[8]

(c) That the applicants were informed prior to their entry into the tenancy agreement that "there was a Council approved development which contemplated the house and shed being retained and being included within an approved lot in the subdivision"[9] and "the development would have to occur around the tenants during the term of the tenancy and this would involve a new access point being provided to the house and shed and the moving of fences";[10]

(d) That the tenancy agreement had clauses in it allow for these matters, including:

(i) "that the tenants were aware that the lawn and garden maintenance cost was to be met by the landlord because we wished to maintain ongoing access to the shed from where we carry on our transport business and it was unfair to impose these costs on the tenant due to the overall size of the property";[11]

(ii) "the tenants were aware that they had the use of the immediate surrounds of the house only. They were not leasing the whole of the property, just the house and immediate surrounds";[12]

(e) That the immediate surrounds of the house "was to be the landscaped gardens immediately surrounding the house including the area of approximately 120m2 in front of the lawn that is directly adjacent to the front door of the house. The tenants did not have exclusive occupancy of any other part of the property due to the proposed development and the works that would be carried on outside of these immediate surrounds";[13] and

(f) That "the applicants were aware that a new driveway was to be installed and that fences would be relocated around it".[14]

• [25] In my view the statements by Mr Phillips support the tenants' submission by confirming that the house and shed as presented to the tenants for lease were situated and described as existing on a two-acre lot within the property. That it would be unfair to impose lawn and garden maintenance upon tenants for two acres is understandable in the context that the overall property was 23 acres and the Phillipses were maintaining that anyway, and sharing use of the shed on the two acres. It makes less sense to suggest that the tenants only leased 120m2 or thereabouts around the home because maintaining such a small space would not, surely, be a burden or unfair to tenants.
• [26] The respondent produced a statement dated 12 August 2020 by Greg Jacobi, a land sales representative working on the respondent's behalf. That statement adds little value to the dispute in question, other than to confirm that on 8 May 2020 when Mr Yates noticed the removal of fences and trees on the property, he immediately reported his anger and concern about the loss of a privacy screen. Mr Yates has not disputed his distress over the works undertaken and in fact seeks compensation for it.
• [27] The respondent tendered entry notices dated 28 July 2020 and 31 July 2020 for "carrying out routine repairs or maintenance" for "Truncating the driveway through the garden and lawn area as per attached plan" and breach notices directed to the tenants for "displaying aggressive behaviour and preventing the property owner from entering the premises to construct a new driveway providing tenants with access to the new road" and for preventing the erection of "safety barricading separating the construction/works from the house as per instructions... by Workplace Health and Safety".

• [28] Section 11 of the Queensland Civil and Administrative Tribunal Act 2009 (Qld) ("the QCAT Act 2009") gives the Tribunal jurisdiction over minor civil disputes. Schedule 3 of the Act includes a "tenancy matter" as a minor civil dispute, a tenancy matter being defined in Schedule 3 as a matter under which a person may apply under the Residential Tenancies and Rooming Accommodation Act 2008 (Qld) ("the RTRAA").
• [29] QCAT's jurisdiction in residential tenancy matters is limited to $25,000.[15]
• [30] The RTRAA in section 11 defines a "residential tenancy" as the right to occupy residential premises under a residential tenancy agreement and section 12 defines a "residential tenancy agreement" as an agreement under which a person gives to someone else a right to occupy residential premises as a residence.
• [31] A tenant cannot apply to the Tribunal about an issue unless they have first sought RTA conciliation and either the conciliation process has ended without agreement reached, or a compromise was reached but this has not been adhered to.[16]
• [32] An application to the Tribunal about a breach of a tenancy agreement must be made within six months of the breach coming to the attention of the applicant.[17]
• [33] The applicants' claims are:

(a) Under section 94 for rent reductions for loss of amenity/facilities; and

(b) Under sections 419 and 420 for compensation for breach.

• [34] Section 429(1) gives the tribunal jurisdiction to hear a dispute "about an agreement". and to decide the terms and parties to the agreement and to construe the agreement.[18]

• [35] Whether to order a reduction in rent is discretionary, and the Tribunal may refrain from making an order reducing the rent if it would be unjust to make such an order.[19]
• [36] The basis of calculating an appropriate decrease in rent will depend very much on the facts of the case. Water ingress from the roof resulting in ceiling damage to a bedroom in a four-bedroom home may force the tenants to occupy the home as a three-bedroom property. The difference in rent in a three-bedroom as opposed to four-bedroom dwelling of similar style and condition in the same locale might form the basis of a reduction in rent. An alternative approach is to take a percentage reduction based on the proportion of the house which is affected as a starting point.
• [37] It may be right in some cases when assessing a reduction in rent to take account of the tenant's particular sensitivities, or those of the tenant's family which have increased the discomfort and inconvenience suffered - particularly if these were made known to the lessor over the period of the problem.

• [38] By clause 19(2) and 19(3) of the standard terms, reflected in Section 183 of the RTRAA, the lessor must take reasonable steps to ensure the tenant has quiet enjoyment of the premises, and neither the lessor nor the lessor's agent may interfere with the reasonable peace, comfort or privacy of the tenant in using the premises.
• [39] Whether or not there is a breach of the term as to quiet enjoyment in a particular case is a question of fact.
• [40] In Kenny v Preen[20] threats by letter and shouting and banging on the door breached the lease because the behaviour tended to deprive the tenant of the full benefit of the right to possession and because the landlord sought to bring an end to the lease by intimidation.

• [41] I find that the area of the leased tenancy referred to in Special Term 7 as the "house and immediate surrounds" is the two-acre (or thereabouts) parcel of land identified as Proposed Lot 6 in the Building Envelope Plan, subject only to a marginal increase in the size of that lot following survey and a slight boundary shift, which, on the evidence of the respondent is up to 15% larger than the 7,531m2 originally contemplated.
• [42] In doing so I note that:

(a) The standard terms override the special terms and the standard terms describe the tenancy as [redacted] without reduction.

(b) The "premises" leased includes the "inclusions" that the items schedule included the extensive gardens, trees and fences photographed upon entry.

(c) The evidence of the original leasing agent, the tenants and the current rental market values (indicating the rent of $650 would be for acreage) support the applicants' position that the tenancy was for two acres. The plan shown to them identified Lot 6 as the land on which the house and shed were situated.

(d) I find that the evidence of the original lessor also in fact supports the applicants' position: it makes no sense that the lessor would offer to undertaken gardening because of the large size of the tenancy if the tenancy was only of a house and 120m of yard. It wouldn't be unfair or a burden to a tenant to maintain such a small parcel of land.

• [43] I find that the breach notices issued in the context of the dispute over the boundary of the tenancy followed invasive and disruptive actions of the respondent, the dispute resolution request to the Residential Tenancies Authority and the filing of the application to the Tribunal by the tenants.
• [44] The application to the Tribunal was filed on 23 July 2020 and the entry and breach notices followed. I therefore find that the breach notices were part of the intimidatory conduct by the respondent, were not grounded, and I set them aside accordingly.

• [45] I find that the respondent has further unreasonably and substantially interfered with the reasonable peace, comfort and privacy of the tenants in using the premises with a view to intimidating them into terminating, or agreeing to terminate the tenancy early.
• [46] Whilst the tenants accepted that fences might be temporarily displaced during the tenancy to enable the driveway works to be undertaken they did not contemplate, nor could they reasonably have contemplated, the extent to which their tenancy has been substantially and unnecessarily invaded by the actions of the respondent.

• [47] Under the circumstances, I find that the application is grounded, that the respondent has breached its obligation to provide quiet enjoyment of the property, that the respondent has failed to remedy that breach and further that even if the reinstatement of the fence and trees occurs, Mr and Mrs Yates have suffered an unacceptable and substantial intrusion by the respondent into the area of their tenancy and that they have suffered a loss of amenity as a result.
• [48] I calculate the loss of amenity for the major works to be 20% of the rent payable by the tenants, namely $132.50 per week.
• [49] I calculate the ongoing loss of the gardens immediately surrounding the house at 5% or $32.50 per week.
• [50] As the tenancy is ongoing, the orders will reflect a partial lump sum payment to the tenants and otherwise will apply a credit to the tenancy ledger.
• [51] I make no orders for the additional compensation sought for trauma, stress, suffering and the like. These claims are in the nature of a personal injury claim and are outside of the Tribunal's minor civil disputes jurisdiction.

• [52] I find it appropriate to exercise discretion under section 102 of the QCAT Act 2009 to order costs to the applicants in the form of reimbursement of their filing fee of $345.80.
• [53] Their application has been successful, albeit not to the full extent of their claim. This was a relatively complex dispute that the RTA declined to conciliate. The fee had to be paid to get them to this point.
• [54] I make no additional orders as to costs for legal fees and the like. They are not within the Tribunal's discretion to order.

1. The respondent to reinstate all fences to the side and rear of the property to the state that they were in as at 19 May 2020.
2. The respondent to "make good" the fenced area behind the house on the property, by filling in all holes created by the removal of trees and fence posts, and levelling the round with a roller or similar.
3. The respondent to remove all soil and building materials deposited within the boundaries of the area covered by the Residential Tenancy Agreement dated 29 March 2019.

1. That the area of the leased tenancy under the General Tenancy Agreement dated 29 March 2019 and referred to in Special Term 7 as the "house and immediate surrounds" is the two-acre (or thereabouts) parcel of land identified as Lot 6 upon which the house and shed are situated.
2. That there be a credit on the rent account to reflect a reduction in rent of $132.50 per week ending on the earlier of the date of completion of all of the respondent's works in Orders 1 to 3, and the date the tenancy ends.
3. That over and above that credit, the rent be reduced by $32.50 per week for the permanent loss of the garden amenities that cannot be reinstated to their original condition before the lease commenced from 19 May 2020 to the date the tenancy ends.
4. That the credit in Orders 5 and 6 be partially discharged by a lump sum payment by the respondent to the applicants of $2,145.00 for the 13-week period commencing 19 May 2020 to be made by the respondent to the applicants within 14 days of the date of this Order.
5. That the breach notices issued by the respondent to the applicants for aggressive behaviour and obstruction of works are set aside.
6. That the respondent pay the applicants the additional sum of $345.80 in costs within 14 days of the date of this Order.
7. A copy of this decision together with formal orders will be mailed out to the parties by the Registry.

[1] Agreed by all parties, see also "Moreton Bay PD Online" extract dated 22 July 2020 confirming the same.

[2] Part 2, Division 1, Standard Term 1(a).

[6] Appendix 2 of the respondent's submissions.

[7] Paragraph 6 of Mr Phillips' statement.

[8] Paragraph 7 of Mr Phillips' statement.

[9] Paragraph 8c of Mr Phillips' statement.

[10] Paragraph 8d of Mr Phillips' statement.

[11] Paragraph 9a of Mr Phillips' statement.

[12] Paragraph 9c of Mr Phillips' statement.

[13] Paragraph 10 of Mr Phillips' statement.

[14] Paragraph 11 of Mr Phillips' statement.

[18] Stone v Grundy [2018] QCATA 68, [46].

[19] Cain v Daudet [2020] QCATA 78, [22], citing Underwood v Queensland Department of Communities (State of Queensland) [2012] QCA 158, [28], [30].

[20] [1962] EWCA Civ 2; [1963] 1 QB 499.