Zverara v Jarpen Holdings Pty Ltd

Background to the Complaint

1. The background to the Complaint is largely agreed.
2. The Owners own a three bedroom property in Sydney's eastern suburbs, which is managed by Raine & Horne (the Property). On or about 20 October 2015, the Property was advertised with a weekly rent of $770. Ms Zverara inspected the Property on 21 October and 24 October 2015. According to Ms Zverara, she was the only person to inspect the Property on 24 October and during that inspection she gained the impression from the managing agent (the Agent) that the Owners were "desperate to receive applications". According to Ms Zverara, she raised with the agent whether the Owners would consider installing air-conditioning in the upstairs bedrooms and was told to put the request in the application. In addition, she claims that the agent suggested that she offer a lower rent.
3. On 26 October 2015, Ms Zverara submitted a written application to Raine and Horne disclosing she was single, had a three month old baby, was on maternity leave and owned a property in a nearby suburb which she planned to rent out during the tenancy.
4. In a covering letter attaching the application, Ms Zverara wrote that "if possible" she would like air conditioning installed in the upstairs bedrooms. She wrote she would be prepared to pay 20 per cent of the installation and purchase costs. As an alternative, she proposed the rent be reduced to $730 per week for the first 12 months of the tenancy.
5. On the day Ms Zverara submitted her tenancy application, she received an email from the agent asking how long she planned to be on maternity leave. Ms Zverara replied "another 12 or 18 months" and wrote that she did not need to work, had quite a bit of savings, receives parental leave and would be renting out her apartment. She provided documents in support of those claims.
6. On or about 31 October, not having received a reply, Ms Zverara contacted the agent and was told that she was the only applicant for the Property and she was waiting to hear back from the Owners. Two days later Ms Zverara received an email from the agent "we are no longer proceeding with your application" Ms Zverara requested but was not given reasons for that decision.
7. On 5 November 2015, Ms Zverara submitted a further application. By this time the advertised rent had dropped from $770 to $750. Ms Zverara agreed to pay weekly rent of $750 and offered to provide any further information on request. The following day, the agent advised Ms Zverara that her application had been refused. Ms Zverara replied: If this is not matter of rent, then what? Why aren't you telling me the reason? Is the reason that I have a child? You haven't given any other reason, even though I asked again and again.
8. The agent replied: The owner makes the decision and they have not decided to proceed with your application. That is all we have received from the owner.
9. Later that day Ms Zverara emailed the Agent: Ok, so I confirm that, notwithstanding that I offered the rent asked for and provided all necessary documents (you have not asked for anything in addition), my application is not considered, even though the property has been for vacant is available and has been and currently continues to be advertised for rent. If the above is not correct, please let me know, otherwise we will assume that the above is factually correct.
10. The agent replied: Your application was looked into and my senior manager was in contact with the owner (who was travelling at the time overseas) in regards to your application and the owner's decision is that we are no longer proceeding with your application.
11. On 25 January 2016, Ms Zverara lodged a complaint with the Board against both Raine and Horne and the Owners. The Board forwarded a copy of the complaint to the principal of Raine and Horne and the Owners.
12. In a reply to the Board dated 23 February 2016, the principal of the Agency:

• asserted that he and his employees were aware of their responsibilities under the anti-discrimination law
• stated that he was appalled by the allegation of "discriminatory behaviour"
• claimed that the Agency neither received nor pressed the Owners for reasons for their decision not to proceed with Ms Zverara's application
• pointed to "a very relevant fact" namely that the successful applicant was "uncannily similar" to Ms Zverara being of the same descent and also a single mother
• asserted that none of these facts would impact on selecting the right tenant , the Owner and agency is "first and foremost" interested in ensuring that the successful applicant will pay the rent punctually and treat the property as their own.

1. In a reply to the Board dated 1 April 2016, the Owners:

• denied discriminating against Ms Zverara on the ground of age, gender and/or marital status
• claimed they were overseas between 23 October 2015 and 6 November 2015
• stated the reason for their decision to reject Ms Zverara's application was "certain questions and requests" she had made to the agent, namely (i) whether the property had "working free-to-air television connection", which she characterised as "a deal breaker", and (ii) whether air conditioning could be installed. With respect to the first of these questions, the Owners claimed that when they received the request they did not know the answer to the question and being overseas had no way to check whether there was a working free-to-air connection. With respect to the latter they stated that being overseas they were unable to make relevant enquires and obtain quotes to have air-conditioning installed. In addition, they claim they had not been advised of Ms Zverara's counter offer to pay $730 per week
• Claimed that Ms Zverara's age, gender and living arrangements "did not in any way influence our decision". Indeed, they claimed they were "perfectly content" with Ms Zverara's employment status and were satisfied she would be a reliable tenant.
• Stated that the primary reason they did not give reasons for their decision to reject Ms Zverara's applications was because they were overseas, had a busy schedule and limited email access. They wrote that in hindsight they appreciated how their silence could have been misinterpreted.

Statutory framework: unlawful discrimination

1. The Act makes it unlawful for a person whether as principal or agent, to discriminate against another person on the grounds of sex, age and domestic and marital status. With respect to discrimination on the grounds of domestic and marital status in the area of accommodation, the Act states: 48 Accommodation (1) It is unlawful for a person, whether as principal or agent, to discriminate against another person on the ground of marital or domestic status: (a) by refusing the person's application for accommodation, …
2. The provisions relating to discrimination in the area of accommodation on the grounds of sex and age are in similar terms: see ss 34 and 49YO.
3. The Act defines unlawful discrimination on the grounds of marital or domestic status to mean: 39 What constitutes discrimination on the ground of marital or domestic status (1) A person ("the perpetrator") discriminates against another person ("the aggrieved person") on the ground of marital or domestic status if the perpetrator: (a) on the ground of the aggrieved person's marital or domestic status or the marital or domestic status of a relative or associate of the aggrieved person, treats the aggrieved person less favourably than in the same circumstances, or in circumstances which are not materially different, the perpetrator treats or would treat a person of a different marital or domestic status or who does not have such a relative or associate of that marital or domestic status, or (b) requires the aggrieved person to comply with a requirement or condition with which a substantially higher proportion of persons of a different marital or domestic status, or who do not have a relative or associate of that marital or domestic status, comply or are able to comply, being a requirement which is not reasonable having regard to the circumstances of the case and with which the aggrieved person does not or is not able to comply. (1A) For the purposes of subsection (1) (a), something is done on the ground of a person's marital or domestic status if it is done on the ground of the person's marital or domestic status, a characteristic that appertains generally to persons of that marital or domestic status or a characteristic that is generally imputed to persons of that marital or domestic status. …
4. Discrimination on the ground of sex is defined in s 24 of the Act.
5. The Act also provides: 4A Act done because of unlawful discrimination and for other reasons If: (a) an act is done for 2 or more reasons, and (b) one of the reasons consists of unlawful discrimination under this Act against a person (whether or not it is the dominant or a substantial reason for doing the act), then, for the purposes of this Act, the act is taken to be done for that reason.
6. In the course of the leave hearing, Ms Zverara advised that she had decided to abandon her claim of discrimination on the ground of age.

What Ms Zverara must establish: direct discrimination

1. It is agreed that the conduct about which Ms Zverara complains, namely the refusal of her application for accommodation on the grounds of sex and marital or domestic status, falls within substantive provisions of the Act, namely ss 34(1)(a) and 48(1)(a).
2. To succeed as a complaint of "direct discrimination" on the ground of marital or domestic status and/or age, Ms Zverara must establish:◦ 1. That by refusing her application(s) for accommodation, the Owners treated her less favourably, in the same or similar circumstances, than they treated, or would have treated a man and/or a person of a different marital or domestic status (less favourable treatment); 2. That one of the reasons for that less favourable treatment was because her marital or domestic status and or sex, a characteristic that generally appertains to, or is generally imputed to women or persons of her marital or domestic status (causation).

Identification of the characteristic

1. Ms Zverara asserts that the real reason the Owners rejected her two applications was because they had misgivings about her capacity to pay rent on account of being a young single woman with a baby on maternity leave. In support, she points to the fact that almost immediately after receiving the first tenancy application, the agent contacted her and asked the length of time she intended to be on maternity leave. She contends that coupled with the fact that it took four weeks to finally lease the premises and then at a lower rent than the rent she had offered to pay, in circumstances where the Owners were "desperate", permits the inference to be drawn that the real reason her applications were refused was because the Owners had misgivings about her financial capacity to pay rent.
2. In the course of the hearing, I raised with the parties my view that Ms Zverara appeared to be seeking to rely on the so-called "characteristics extension" provisions of the Act. These provisions operate to extend the proscribed grounds of discrimination, in this case domestic and marital status and sex, to include:

• a characteristic that appertains generally to persons with the complainant's proscribed ground, in this case sex and marital and domestic status, and
• a characteristic that is generally imputed to persons of the complainant's proscribed ground.

1. In relation to discrimination on the ground of sex, the characteristic extension is contained in s 24(1A) of the Act. Section 39(1A) contains the equivalent provision in relation to discrimination on the ground of martial and domestic status.
2. At the conclusion of the hearing I invited Ms Zverara to make written submissions setting out in relation to each claimed ground, the characteristic on which she seeks rely. The respondents were invited to reply to those submissions.
3. In submissions received after the hearing, Ms Zverara identified the relevant characteristic in the following terms: (i) Marital or domestic status
4. Ms Zverara submits that a characteristic generally imputed to "single mothers" is being a "risky and unreliable tenant". In support she pointed to a number of academic studies, including Short, Patricia, Seelig, Tim, Warren, Clive, Susilawati, Connie, & Thompson, Alice (2007) Risk-assessment practices in the private rental sector: implications for low-income renters.
5. "Marital or domestic status" is defined at s 4 of the Act to mean the status or condition of being: (a) single, or (b) married, or (c) married but living separately and apart from one's spouse, or (d) divorced, or (e) widowed, or (f) in a de facto relationship.
6. As is apparent, the definition of marital or domestic status makes no reference to parental responsibilities. To rely on this ground, Ms Zverara must establish that being a "risky and unreliable tenant" is a characteristic that is generally imputed to persons of her marital or domestic status, single people. The flaw in Ms Zverara's argument is the assumption that the Act permits the conflation of proscribed grounds. The claimed characteristic must generally appertain or be imputed to persons of the proscribed ground - not a combination of proscribed grounds. This is plain from the language and structure of s 39(1A): [S]omething is done on the ground of a person's marital or domestic status if it is done on the ground of the person's marital or domestic status, a characteristic that appertains generally to persons of that marital or domestic status or a characteristic that is generally imputed to persons of that marital or domestic status.
7. On Ms Zverara's case, being a "risky and unreliable tenant" is not a characteristic generally imputed to single people but rather a characteristic generally imputed to single people who are also parents. It follows that the purported characteristic could not be said to be one generally imputed to single people.
8. Part 4B of the Act proscribes discrimination on the ground of a person's responsibilities as a carer in certain areas but not accommodation. In contrast, the Act makes it unlawful to discriminate on the ground of sex and marital and domestic status in the area of accommodation.

(ii) Sex

1. Ms Zverara contends that being out of the workforce for a period of time for the purpose of child-bearing and child-rearing, is a characteristic that "appertains generally" to women, citing in support Kemp v Minister for Education & Anor (1991) EOC 92-340 at 78,372. Ms Kemp, a teacher who had taken time out of her career to raise children, was demoted on the basis of guidelines which used length of service and seniority as the criteria for promotion. Mrs Kemp's complaint was determined on the basis of a claim of indirect discrimination.
2. Ms Zverara points to CCH, Australian and NZ Equal Opportunity Law and Practice 4-680, in which its authors comment that had Mrs Kemp's complaint been argued on the basis of direct discrimination it may have been successful given the Tribunal considered being out of the work force for a period of time to be a characteristic that appertains to women.
3. The difficulty with this argument is that Ms Zverara contends that the real reason she was discriminated against was because of her assumed incapacity to pay rent. In my view, the proposition that being unable to pay rent, or being a risky tenant is a characteristic that generally appertains to women is untenable. While being unable to pay rent is arguably a consequence of being out of the workforce for a period of time for the purpose of child-bearing and child-rearing, nonetheless it does not follow that the former is a characteristic that generally appertains to women.

Conclusion

1. Cast as a complaint of direct discrimination, the Complaint made by Ms Zervera lacks substance. Therefore, I decline to grant leave for the complaint to proceed on this basis.

What Ms Zverara must establish: indirect discrimination

1. In written submissions, Ms Zverara argued that leave should be granted for the Complaint to proceed cast as a claim of "indirect discrimination" on the ground of sex and marital and domestic status.
2. To succeed as a complaint of indirect discrimination, Ms Zverara must establish: 1. The Owners imposed a requirement or condition; and 2. She was unable to comply with that requirement or condition; and 3. A substantially higher proportion of men or persons who are not of her marital or domestic status comply or are able to comply with that requirement or condition; and 4. The requirement or condition was not reasonable having regard to the circumstances of the case.

The requirement or condition

1. The phrase "requirement or condition" is not defined by the Act. The alleged "requirement or condition" must be identified with some degree of precision (Australian Iron and Steel Pty Limited v Banovic [1989] HCA 56; (1989) 168 CLR 165 ("Banovic") at 185; Waters v Public Transport Corporation [1991] HCA 49; (1991) 173 CLR 349 ("Waters") at 393, 406-7; Catholic Education Office v Clarke [2004] FCAFC 197; (2004) 138 FCR 121 at 143). However, '"considerable latitude is afforded to applicants in formulating the requirements or conditions about which they complain" (Walker v State of Victoria [2011] FCA 258 at [194]).
2. The authorities have consistently stated that the words "requirement or condition" should not be given a narrow or technical construction (State of New South Wales v Amery [2006] HCA 14; (2006) 230 CLR 174 ("Amery") at 195). Rather, the words are to be interpreted liberally so as to further the objects of the Act (Banovic at 185, 195-7, 393-4, 406-7; Amery at [64]). Set out in the long title to the Act, the objects of the Act are "to render unlawful racial, sex and other types of discrimination in certain circumstances and to promote equality of opportunity between all persons".
3. The offending requirement or condition need not be explicit (Banovic at 185; Waters at 360, 407). It may implicitly arise as a practical reality in the circumstances of the case.
4. Ms Zverara formulates the offending requirement in these terms: to be in current paid employment. In support she points to the tenancy application form, which requires the applicant to provide the name of their current employer and supporting pay slips. In addition, she points to the enquiry made by the agent about how long she intended to be on maternity leave, alleged to have been made almost immediately after she lodged her first application,

Should leave be granted?

1. I understand the Owners to contend that Ms Zverara's employment status played no part in their decision to refuse to accept Ms Zverara's tenancy application. As noted, they claim their decision largely turned on the request made by Ms Zverara for air conditioning to be installed.
2. Whether, as Ms Zverara alleges, the Owners and/or Raine & Horne imposed the alleged condition on prospective tenants - to be in current paid employment - is a question of fact. There is some evidence, which if accepted may permit the Tribunal to draw the inference that the alleged condition was imposed. Equally, there is some evidence, which if accepted would support a finding that neither the Owners nor Raine & Horne imposed the alleged condition.
3. Even if it is accepted that the Owners had imposed the impugned condition, Ms Zverara must establish the balance of elements listed at [44] above. She has provided some evidence which could support a finding that she is unable to comply with the alleged condition. In addition, she has provided some evidence and argument in support of the proposition that the alleged condition is not reasonable. However, she has neither provided material about nor addressed a critical element, namely whether a substantially higher proportion of persons who are not of her marital or domestic status/sex comply, or are able to comply, with the alleged condition. (see Bonella & Ors v Wollongong City Council [2001] NSWADT 194 at [77].)
4. After careful consideration, I have decided it is not appropriate at a leave hearing to determine a critical factual issue in dispute, namely whether the Owners or Raine and Horne imposed the alleged condition. In reaching that conclusion I have taken into account that none of the parties were legally represented and the facts on which each relied were largely in the form of unsupported and untested assertions.
5. In addition, I decided despite the absence of evidence about whether a substantially higher proportion of married people/men do or can comply with the alleged condition, that it would be fair and just to allow the Complaint to proceed. In reaching that decision I have taken into account that a complaint of indirect discrimination often raises complex questions of fact and law and the formulation of the impugned condition or requirement is notoriously difficult.
6. The interests of justice require that Ms Zverara be given an opportunity to refine her claim, address each of the elements, obtain relevant evidence and to test the respondents' evidence. Equally, they require that respondents be given the opportunity to respond to Ms Zverara's claims and bring further evidence.
7. My decision should not be taken to indicate that I have formed the view that the Complaint has strong prospects of success. Rather, I have decided that the Complaint could not be characterised as being hopeless, based on an untenable proposition of fact or law or lacking in substance. I have concluded it is fair and just to grant leave for the Complaint to proceed and to be determined on its merits. I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales. Registrar DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 02 December 2016