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North South Real Estate v Kavvadas[2017] QCAT 306

North South Real Estate v Kavvadas[2017] QCAT 306

CITATION:

North South Real Estate & Anor v Kavvadas [2017] QCAT 306

PARTIES:

North South Real Estate

Tracey Crampton

(Applicants)

v

Sharon Kavvadas

(Respondent)

APPLICATION NUMBER:

MCDT995/17

MATTER TYPE:

Residential tenancy matters

HEARING DATE:

7 August 2017

HEARD AT:

Brisbane

DECISION OF:

Adjudicator Stanton

DELIVERED ON:

8 September 2017

DELIVERED AT:

Brisbane

ORDERS MADE:

  1. The respondent, Sharon Kavvadas shall pay to the applicant, Tracey Crampton the sum of $25,000.
  2. In part satisfaction of this order, the Residential Tenancy Authority shall pay to the lessor, Tracey Crampton, the bond amount in the sum of $10,000.
  3. The respondent, Sharon Kavvadas shall pay to the applicant, Tracey Crampton, the balance of $15,000 within 14 days of the date of this order.

CATCHWORDS:

LANDLORD AND TENANT – RESIDENTIAL TENANCIES LEGISLATION – OBLIGATIONS, PROHIBITED MATTERS AND PROTECTION FOR LESSEES – RENT – where claim for rent decrease because of loss of use of swimming pool and air conditioning – where tenancy previously terminated by order of Tribunal

LANDLORD AND TENANT – RESIDENTIAL TENANCIES LEGISLATION – OBLIGATIONS, PROHIBITED MATTERS AND PROTECTION FOR LESSEES – RATES AND CHARGES – where claim for compensation for a period after the date of termination – where claim for water consumption charges – where premises found to be not water efficient – where evidence of water leak – where claim made for reimbursement of charges incurred more than six months previous – whether adjustment of expenditure claim should be made on account of betterment – where claim made for trimming of a large feature tree – where reduction to claim made on carpet replacement cost on account of age of carpet – where applicant abandoned that part of claim in excess of monetary jurisdiction of tribunal

Queensland Civil and Administrative Tribunal Act 2009 (Qld), s 12(3), s 13, Schedule 3

Residential Tenancies and Rooming Accommodation Act 2008 (Qld), s 94, s 166, s 169(4), s 185, s 188, s 217, s 362, s 419, s 516

Gration v Gillian Investments Pty Ltd [2005] QCA 184

Masinello v Parker & Anor (No.2) [2013] QCATA 325

Proudfoot v Hart [1890] 25 QBD 42

Robinson v Harman (1848) 1 Ex 850

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

APPEARANCES:

APPLICANT:

No appearance of representative of North South Real Estate

Tracey Crampton in person

RESPONDENT:

Bill Kavvadas, husband of Sharon Kavvadas

REASONS FOR DECISION

The facts

  1. [1]
    Ms Crampton has been the owner of a riverfront residential property at 16 Wendell Street, Norman Park since 22 February 2016. On 17 March 2016, she appointed North South Real Estate to manage this property. Subsequently, on 6 April 2016, a written tenancy agreement was entered into by which Ms Kavvadas rented the property from 8 April 2016 to 7 February 2017, at a monthly rent of $8,255.95. A rental bond of $10,000 was paid and that amount is still held by the Residential Tenancy Authority. On the day of the commencement of the tenancy, Ms Kavvadas paid not only the bond amount, but also a lump sum payment for rent of $66,047.60, which paid the rent in advance to 7 December 2016. No further payments have since been made.
  2. [2]
    The tenancy agreement as entered into, provided that the tenant was to pay for water supplied to the premises and also electricity, gas and phone charges. The agreement also allowed for the tenant to keep a dog at the premises.
  3. [3]
    Subsequently, a further written tenancy agreement was entered into by the parties for the period from 8 February 2017 to 7 February 2018. The rent remained unchanged for this further tenancy.
  4. [4]
    On 3 March 2017, this Tribunal made an order terminating the tenancy agreement as from midnight on 6 March 2017, on the grounds of failure to leave. A warrant of possession was subsequently executed by the Police and Ms Kavvadas was evicted from the premises on 8 March 2017.
  5. [5]
    A dispute later arose between the parties and despite the process of conciliation having taken place, no agreement was reached. The Residential Tenancies Authority issued a Notice of Unresolved Dispute on 7 April 2017.
  6. [6]
    By application filed with this tribunal on 19 April 2017, the agent sought an order for payment of claim in the sum of $25,000. It then listed its various claims as rent arrears $25,582.14, utilities $23,114.04 and exiting invoices of $4,908. It made no claim for costs.
  7. [7]
    By sworn statement filed with the tribunal on 3 August 2017, Ms Crampton said that North South Real Estate no longer acted on her behalf. At the hearing, she sought an order to be joined as an Applicant. In her statement, she provided updated and detailed information as to the various claims she was making against Ms Kavvadas. She also said in her statement that she had received an insurance payment of $24,767.85 for rent and replacement of locks. By paragraph 23 of her statement, she sought orders for payment of the bond of $10,000 to her and also that Ms Kavvadas pay to her the sum of $25,000.
  8. [8]
    By counter-application filed on 4 August 2017, Ms Kavvadas sought an order for a rent reduction of $25,000 on account of air-conditioning failure and pool not working.
  9. [9]
    The hearing of this dispute came before the Tribunal on 7 August 2017, at which time Ms Crampton and Mr Kavvadas, the husband of the respondent, both appeared and gave evidence. By consent, it was ordered that Ms Crampton be joined as an applicant in the proceedings.  Ms Crampton also acknowledged that she abandoned that part of her claim that was in excess of the jurisdiction of this Tribunal. 

The Law

  1. [10]
    In these proceedings, it is the role of the Tribunal to consider all of the evidence and submissions made by the parties and to then make orders that are considered fair and equitable to the parties. In matters of this kind, the parties represent themselves and the Tribunal is not bound by the rules of evidence and must act with as little formality and technicality as the Tribunal permits. The Tribunal is required to deal with matters in a way that is accessible, fair, just, economical, informal and quick.
  2. [11]
    I do not intend to re-state all of the evidence given by the parties to the claim as that is all contained in the recording of the proceedings. Nor do I intend to comment on all such verbal evidence and the documentary evidence as filed with the Tribunal.
  3. [12]
    I have had the opportunity to fully consider all the evidence given at the hearing and all the documents on the Tribunal file, including those produced at the hearing. I have also considered the submissions made by the parties. I have had the benefit and advantage of listening to both Ms Crampton and Mr Kavvadas give their evidence and observing them whilst they gave such evidence.
  4. [13]
    In matters of this kind, the Tribunal applies the civil standard of proof, which is proof on the balance of probabilities. The onus of establishing that proof on the balance of probabilities, lies with the applicant in respect of her claim and with the respondent in respect of her counter-application.
  5. [14]
    The application before the Tribunal is a residential tenancy dispute so falls within the definition of ‘minor civil dispute’. Accordingly, it falls within the jurisdiction of this Tribunal which has monetary jurisdiction up to $25,000 for minor civil disputes.
  6. [15]
    The dispute between the parties arose out of a tenancy agreement, which is subject to the provisions of the Residential Tenancies and Rooming Accommodation Act 2008 (Qld) (the Act).  
  7. [16]
    This matter is classed as a non-urgent matter so was subject to those provisions which required that before making the application to the Tribunal, a dispute resolution request, in respect of each issue, must first have been made and the conciliation process have ended. That process was completed and a Notice of Unresolved Dispute was duly lodged with the tribunal.
  8. [17]
    It was a further mandatory requirement under s 419 of the Act, that the dispute resolution request have been made or an application have been filed with the Tribunal within six months after the lessor or tenant became aware of the breach.

Tenant’s obligations

  1. [18]
    Apart from the obligation to pay rent and other sums as set forth in the tenancy agreement, the tenant’s obligations generally are set out in the provisions of s 188 of the Act and are reproduced in the ‘Standard Terms’ which form part of the General Tenancy Agreement. They are:
    1. The tenant must keep the premises and inclusions clean, having regard to their condition at the start of the tenancy;
    2. The tenant must not maliciously damage, or allow someone else to maliciously damage, the premises or inclusion;
    3. At the end of the tenancy, the tenant must leave the premises and inclusions, as far as possible, in the same condition they were in at the start of the tenancy, fair wear and tear excepted.
  2. [19]
    The question of what constitutes ‘fair wear and tear’ often arises in residential tenancy disputes. Generally, it means damage or disrepair of the premises or their fixtures or fittings, caused or resulting from normal use or changes that happen with ageing. The legal meaning attributable to the word ‘wear’ is the deterioration due to use. The word ‘tear’ means the deterioration due to forces of nature.[1] Whilst a tenant will be responsible for negligent, irresponsible or intentional actions that cause damage, the tenant will not be responsible for deterioration caused by ordinary, everyday use or deterioration that occurs as a result of normal exposure to the elements or which naturally occurs over a period of time.
  3. [20]
    The rule of the common law as to damages for breach of contract, is that where a party sustains loss by reason of a breach of contract, he is, so far as money can do it, to be placed in the same situation, with respect to damages, as if the contract had been performed.[2] This is however, subject to the usual rules as to betterment, remoteness, reasonableness, the duty to mitigate and causation.
  4. [21]
    The principal relating to betterment requires that the damages award must not place a party in a better position than if the breach had not occurred in the first place. The legal concept of betterment involves unearned or excess increase in value[3] for which it is necessary that an adjustment be made that is fair and reasonable in all the circumstances.
  5. [22]
    The question as to whether damages for rectification of work will be awarded depends on whether the rectification work is considered to be ‘necessary’ and ‘reasonable’. If the work is not necessary and reasonable, damages on the basis of diminution in value will be given.
  6. [23]
    S 362 of the Act requires an applicant to take all reasonable steps to mitigate the loss or expense and will not be entitled to receive compensation for any loss or expense that could have been avoided by taking those steps. However, the obligation is only to take reasonable steps. Whether an applicant has acted reasonably or unreasonably is a question of fact that will depend on the individual circumstances of the case. Applicants are only required to take steps that are reasonable - they do not have to resort to steps that are costly or extravagant.
  7. [24]
    On the matter of causation, only the loss caused by the breach is recoverable. In most instances, causation will be established, if but for the breach, the loss would not have occurred.

Lessor’s obligations

  1. [25]
    The lessor’s obligations generally are set out in the provisions of s 185 of the Act and are reproduced in the Standard Terms, which form part of the General Tenancy Agreement.
  2. [26]
    At the start of the tenancy, the lessor must ensure:
    1. the premises and inclusions are clean;
    2. the premises are fit for the tenant to live in;
    3. the premises and inclusions are in good repair; and
    4. the lessor is not in breach of a law dealing with issues about the health or safety of persons using or entering the premises.[4]
  3. [27]
    While the tenancy continues, the lessor:
    1. must maintain the premises in a way that the premises remain fit for the tenant to live in;
    2. must maintain the premises and inclusions in good repair;
    3. must ensure any law dealing with issues about the health or safety of persons using or entering the premises is complied with; and
    4. … [5]
  4. [28]
    By these provisions, the lessor has a clear obligation at the start of the tenancy to ensure that the premises are clean, fit for the tenant to live in, in good repair and there is no breach of a law about health or safety.
  5. [29]
    The word ‘ensure’ has been the subject of prior judicial consideration when it was held to mean only that at the beginning of the tenancy, the lessor must take reasonable steps to ascertain the existence of any defects in the premises and, if any defects are then discovered, to take reasonable steps to remove them or make the premises safe.[6]
  6. [30]
    The duty to maintain the premises in good repair has been said at common law to be a duty to keep the premises “in such repair as having regard to the age, character and locality of the premises, would make them reasonably fit for the occupation of a reasonably minded tenant of the class who would be likely to take them”.[7] However, the repair obligations do not arise until the lessor has notice of the need for repair. By s 217 of the Act, the tenant has a clear obligation to notify the lessor as soon as practicable of any damage to the premises or the inclusions, and to give notice of any routine repairs required.
  7. [31]
    Pursuant to the Act and the Regulations to the Act,[8] the lessor is allowed to pass on the full water consumption charges (including bulk water charges) to the tenant providing the following criteria is met:
    1. the premises are individually metered;
    2. the premises are water efficient; and
    3. the tenancy agreement states the tenant must pay for water consumption.
  8. [32]
    Whilst a tenant can be charged for both the state bulk water charge and the actual water charge, the tenant cannot be charged for sewerage usage charges or a fixed access charge.
  9. [33]
    By s 166 of the Act, if water efficient devices are not in place, the lessor must pay for a reasonable amount of water for the period that the premises are not water efficient. The tenant must pay for consumption above what is reasonable.  The prescribed water efficiency requirements are set forth in Regulation 22 of the Regulations to the Act.
  10. [34]
    By s 169(4) of the Act, in deciding an amount payable by the tenant for the water service charge, regard must be had to the following:
    1. relevant available information about water usage and charges for premises in the local government area in which the premises are situated;
    2. the area of the relevant land;
    3. the terms of the agreement affecting the amount of water used;
    4. the presence or absence of water saving devices in the premises;
    5. the number of persons occupying the premises;
    6. the quantity of water for which the lessor should reasonably be liable; and
    7. anything else the tribunal considers relevant.
  11. [35]
    In considering what is a reasonable quantity of water, these matters all provide assistance to the tribunal, although there is no precise mathematical calculation or formula that can be applied.
  12. [36]
    With respect to the tenancy agreement for the period from 8 April 2016 to 7 February 2017, it is noted that Addendum A provided as follows:

… The full cost of water consumption may be passed onto the tenant as per the Residential Tenancies Act 1994, if the property is made compliant with the water efficiency level set out in the regulation. The lessor/agent is required to pay all fixed costs for the supply of water to the premises. Tenant is required to pay for excess water, within the council water restriction guidelines (i.e. if the standard amount is 45KL per quarter by council guidelines, the tenant pays for water in excess of this amount.) …

Conclusions

  1. [37]
    With respect to the claim for unpaid rent, it is not in dispute that the rent was paid to 7 December 2016 and that Ms Kavvadas was evicted from the premises on 8 March 2017. Thus, rent for a period of three months and one day remained unpaid. At the agreed rent of $8,255.95 per month, the rent outstanding is calculated in the sum of $25,039.28.
  2. [38]
    The unchallenged evidence of Ms Crampton is that a new tenant did not commence a lease over the premises until 29 July 2017. Ms Crampton has sought compensation for the period to this date.  It is to be recalled that the tenancy between the parties was not due to end until 7 February 2018.  There has been no challenge as to those steps that were or were not taken by or on behalf of Ms Crampton, with a view to having a new tenancy agreement entered into, after Ms Kavvadas had been evicted. Issues relating to the duty to mitigate were not raised at the hearing. The subject property was described in some detail in an advertising document filed with the Tribunal. It described the property as a prestige riverfront home at a rental of $1,900 per week. Whilst the vacancy period from 9 March 2017 to 28 July 2017 is quite lengthy, it is perhaps not surprising that a longer period of time may pass before a new tenancy is negotiated, when due regard is had to the likely demand for a property of the kind as described, the weekly rent being sought and the prevailing market conditions over the relevant period. In those circumstances, the claim for lost rent over this period, was not unreasonable. The quantum of the rental loss has been established and was not disputed. That period represents four months and 20 days and when calculated, at the prior agreed monthly rent, it equates to an amount of $38,452.37.
  3. [39]
    With respect to the claim for water charges, it is clear that both tenancy agreements provided that the tenant was to pay for water supplied to the premises. It is also clear that the premises were individually metered. However, no evidence was placed before the Tribunal to indicate that the premises were water efficient. Indeed, Ms Crampton conceded that the premises were not ‘certified’ as water efficient. The evidence was that over the course of the tenancy, the property was occupied by three persons only. The property was described as a three level riverfront home, comprising five bedrooms, pool and extensive living areas. Ms Crampton said the land area was 931 square metres. She said she was not aware of the normal water usage. She said that water was not used in a sprinkler system or for landscaping at the property. There was evidence that at some point in time, a water leak in a pipe occurred near the boundary of the property. Ms Crampton said in evidence that the water leak was not apparent and that she assumed the water went into the river, as there were no wet patches or leaks apparent. Ms Crampton also said in evidence that the dwelling was some 22 years old. Mr Kavvadas said he was not aware of the water leak. In the absence of reliable evidence that the premises were water efficient, I conclude that it is more probable than not, that the premises were not water efficient over the relevant periods. It is to be noted that the four quarterly invoices from Queensland Urban Utilities, show that the water consumption for the premises was substantially higher than the local area average and also the Brisbane average. I am satisfied that it is more probable than not, that there was a substantial water leak which has resulted in the excessive water charges having been incurred. There is no evidence to establish that the tenant was responsible for the occurrence of this water leak. Arrangements for the collection of mail to the property were quite unsatisfactory, so it is perhaps not surprising that the magnitude of the water charges did not become apparent for some time. There is no evidence as to the extent of the water loss that may have occurred or the period of such loss. No evidence has been led which might provide any basis for determining what amount, ought properly to be payable by the tenant for water charges in excess of what the lessor is responsible for. Having regard to the existence of the water leak and the lessor’s obligation to pay for a reasonable amount of water, I conclude that it has not been established that the tenant has any obligation in respect of the invoices as issued by Queensland Urban Utilities.
  4. [40]
    With respect to the claim for gas charges, four invoices have been filed with the tribunal. They were issued on 26 May 2016, 22 August 2016, 16 November 2016 and 2 February 2017. The notice of unresolved dispute as issued by the Residential Tenancy Authority is dated 7 April 2016.  The effect of s 417 and s 419 of the Act, is that breach claims, which the lessor becomes aware of and which are in excess of six months prior to submitting a dispute resolution request, are not able to be successfully made. It would reasonably be expected that the invoice dated 26 May 2016 would have been received shortly after that date. A lessor is required to act in a reasonable manner and ought to have forwarded such invoices to the tenant within a reasonable period seeking reimbursement, if such a claim against the tenant was intended to be pursued. I would consider that a reasonable period to have forwarded such invoice to the tenant would be a period of one month. Had the lessor so acted, I conclude that the lessor ought to have been aware of any breach by the tenant in not paying, if after a further period of another one month after the invoice was forwarded to the tenant, payment had not been received from the tenant.  In consequence of the six month limitation period, I conclude that the lessor is not able to recover the amount of the first invoice, although is able to recover the amounts of the later three invoices in the sums of $113.49, $119.62 and $123.97. I would therefore allow the sum of $357.08 for gas charges.
  5. [41]
    With respect to the claim for electricity charges, three invoices from Origin have been filed with the tribunal. An invoice issued on 6 October 2016 for the period from 5 July 2016 to 29 September 2016 refers to the sum of $631.83 as the amount due. A further invoice issued on 18 January 2017, covers charges and adjustments over the period from 24 February 2016 to 9 January 2017. As the tenancy did not begin until 8 April 2016, an adjustment is therefore required. Disregarding the charges and credits relating to the period prior to 8 April, 2016, the balance of monies payable amounts to $6,802.24. The next invoice issued on 10 February 2017 is for the period from 10 January 2017 to 31 January 2017 and is for a sum of $806.51. As the tenancy agreement provides that these charges are payable by the tenant, I conclude the amount payable by Ms Kavvadas is $8,240.58. However, the amount as claimed by Ms Crampton was limited to the sum of $7,327.20. I would allow that lesser amount as claimed.
  6. [42]
    In respect of the swimming pool, Mr Kavvadas maintained that the ‘pool never worked’. His version is supported to some extent by the report of Peter Chalmers of Jim’s Pool Care dated 3 May 2016, in which comment is made that the chlorinator was not producing enough chlorine because the cell was old and the filter multiport was leaking. He recommended that with the age of the filter, strong consideration should be given to replacing it. A number of invoices from JC Pool Services have been filed with the Tribunal. The first invoice dated 20 April 2017 in the sum of $248.65 represents the service call fee of $75, pool chlorine of $140.70 and algaecide of $32.95.  In view of the contents of the earlier report of Jim’s Pool Care, I do not consider these charges to be properly payable by the tenant, as it seems probable that these expenses have been incurred in consequence of the equipment issues as raised in such report.  The invoice dated 28 April 2017 in the sum of $473.60 relates to the repair to the pump. There was no evidence to show any act or neglect on the part of the tenant which may have contributed to the problem with the pump. It seems more probable than not, that such cost would be attributable to fair wear and tear and accordingly, I would not allow that claim. A further invoice dated 22 May 2017, relates to items of pool equipment and other associated costs that were incurred some three months after the tenant was evicted. Again, there is no evidence to establish liability on the part of the tenant for those capital equipment items and associated costs. The same would apply in respect of the chlorinator that was later replaced and which is described in the invoice of 31 May 2017. These claims will be disallowed.
  7. [43]
    A claim is made in the sum of $125.00 for the cost of replacing two remote handsets and battery as supplied by D.K. Doors. Items of that kind are required to be returned to the lessor or agent at the end of the tenancy. That claim will be allowed in full. 
  8. [44]
    Further claims are made for the sum of $572 and $220.20 in respect of re-keying the property. These costs which total $792.20 are recoverable in circumstances where the tenant fails to return the keys to the rental premises after having vacated. Clearly, for reasons of future security of the premises, the taking of the re-keying action was reasonable. Those claims will be allowed.
  9. [45]
    A claim in the sum of $2,210 for bond clean and steam cleaning of the carpet has also been made. Mr Kavvadas maintained the bond clean was for an excessive amount. In giving evidence, he said that the premises were not clean at the start of the tenancy. In the statement of Ms Kavvadas that was produced at the hearing, she also referred to the issue of cleaning. Significantly however, it is noted that the issue of cleaning had not been raised in earlier email correspondence after the tenancy began, by either Mr Kavvadas nor Mrs Kavvadas. The premises are substantial in size and comprise three levels. Moreover, the entry condition report signed by Ms Kavvadas on 8 April 2016 lists all items as clean. In those circumstances, the claim for $2,210 will be allowed.
  10. [46]
    The claim for $300 for removal of rubbish from the property and disposal is a reasonable claim and will be allowed. It is no defence to such a claim that the tenant was evicted and had insufficient time to attend to such matters.
  11. [47]
    The claim from Greenscope Property Services in the sum of $1,826 includes both the lawn and garden clean-up and also the trimming of a large feature tree in front of the building. Whilst the tenant has the responsibility to maintain the lawn and garden, this does not extend to the trimming of branches of a large feature tree. The cost of the lawn and garden clean-up was $980 plus GST. The claim will be allowed in the sum of $1,078.00 only.
  12. [48]
    A further claim has been made in the sum of $1,254 for yard work. It includes yard maintenance type services, although also includes the supply and planting of 12 small plants, fabricating mesh cover for large pond and installation, as well as other items such as the installation of timer on pump plug and removal of small pond, pump etc. The invoice is not broken down for individual amounts for the respective items. As already referred to in these reasons, the legal concept of betterment does not allow for recovery of the full amount, if it would result in the lessor being in a better position than if the breach had not occurred. In those instances, it is an appropriate that a fair and reasonable adjustment should be made. Having regard to the various items included in the total list and their likely respective costs, I would allow one-half of that claim in the sum of $627.00.
  13. [49]
    A claim is made for the supply and installation of new rollers to a sliding door in the sum of $189. There has been no evidence led as to this being required because of any damage or neglect caused by the tenant. It would seem more probable than not, that this item would be classified as fair wear and tear. However, the further cost claimed for re-attaching the plantation roller shutter blinds in the main bedroom will be allowed in the sum of $35.00.
  14. [50]
    A further invoice from Daniel Paul Projects dated 26 May 2017, lists various items for which the total cost was $4,380.00. The only items which would be the tenant’s responsibility would be the cleaning of the glass fence in the sum of $25 and re-attaching the roller blind to the top level rumpus in the sum of $165. There is evidence from Mr Kavvadas, as to water leaks that occurred in the premises during times of rain. No evidence has been led to establish any liability on the part of the tenant for the remainder of the expenses as listed in the invoice. The claim will be allowed in the reduced sum of $190.00.
  15. [51]
    A claim has been made for the cost of carpet replacement in the total sum of $5,258.00. Mrs Crampton attributed the carpet damage to dog urine and not rainwater leaks as alleged by Mr Kavvadas. The tenancy agreement did allow for the tenant to have a dog, although it does not follow that a tenant will not be responsible for damage caused to the carpet by such dog. Ms Crampton said that the carpet was between two and a half to three years old at the end of the tenancy.  In a taxation ruling by the Australian Taxation Office, the effective life of carpet is shown as 10 years.[9] I accept Ms Crampton’s evidence as to the cause of the damage, although would reduce the claim by 30% to allow for the reduction in the value of the carpet.  I would therefore allow the claim in the reduced sum of $3,680.60. 
  16. [52]
    In summary, the claims which will be allowed are as follows:

Rent from 8/12/16 to 8/3/17     $25,039.28

Compensation from 9/3/17 to 28/7/17    $38,452.37

Gas            $357.08

Electricity                     $7,327.20

Handsets and battery         $125.00

Re-keying            $792.20

Bond and carpet clean                       $2,210.00

Rubbish removal          $300.00

Lawn and garden clean-up                 $1,078.00

Yard work           $627.00

Re-attaching shutter blinds         $35.00

Cleaning glass fence and re-attaching blind      $190.00

Replacement of carpet          $3,680.60

TOTAL                $80,213.73

  1. [53]
    By counter application filed by Ms Kavvadas, she sought a rent reduction of $25,000, on account of air-conditioning failure and the pool not working.
  2. [54]
    By s 94 of the Act, provision is made for a rent decrease in certain instances. These provisions apply where the premises are destroyed, or made completely or partly unfit to live in, in a way that does not result from a breach of the agreement. The section also applies if services, facilities or goods to be provided to the tenant under the agreement are no longer available or are withdrawn, other than because the tenant failed to meet the tenant’s obligations, or if the amenity or standard of the premises decreases substantially, other than because of malicious damage caused by the tenant. It is further provided by this provision that the rent payable under the agreement decreases accordingly or, if an order for a decrease in the rent is made by a Tribunal, to the extent stated in the order.
  3. [55]
    It is significant to note that the six month time limitation referred to in s 419 of the Act, does not apply to claims for rent decreases under s 94 of the Act.[10]
  4. [56]
    The provisions of s 94 of the Act have been previously considered by the Queensland Court of Appeal[11] where Muir JA said:[12]

Any such decrease will not be capable of mathematical calculation or  determination by application of a formula. The amount of the reduction will be arrived at by judgments upon questions in respect of which different persons, acting reasonably, will be capable of reaching different conclusions.  These matters suggest that s 94 was not intended to provide for any automatic decrease in rent where the premises were partly unfit to live in or where one or more of the matters in sub-section (2) and (3) applies. Also supporting that conclusion is the fact that, normally, there will be no certainty as to the application of s 94(2)(b) to particular facts until a tribunal has held that there has been a relevant substantial decrease. The question whether premises are ‘completely or partly unfit to live in’ may also give rise to disputed questions of fact.

  1. [57]
    Dealing firstly with the claim for rent reduction on account of the pool not working, it is noted that within one month of Ms Kavvadas taking possession, a written report had been obtained from the franchise owner of Jim’s Pool Care. The report outlined a number of defects in several items of pool equipment and recommended replacement of such equipment.  Ms Kavvadas said in her statement, that the pool was never used as it had electrical issues, amongst other problems. Mr Kavvadas also gave evidence that the pool was never used as ‘it never worked’. This issue was also referred to in email correspondence from Mr Kavvadas to the agent, during the currency of the tenancy.  It is now apparent, as evidenced by the pool invoices filed by Mrs Crampton, that substantial expenditure was not incurred in replacement of pool equipment, until sometime after the tenant had been evicted.  Having due regard to all relevant matters, including the advertised description of the property and the amount of rent payable, I am satisfied that there has been a substantial decrease in the amenity and standard of the premises, because of the pool equipment failures, and that furthermore it is reasonable in the circumstances, that a decrease in rent should be made. It is appropriate that the weekly rent reduction should apply for the period from the start of the tenancy on 8 April 2016 to the date of eviction which is 8 March 2017. This equates to a total of 47.86 weeks.  The rent payable under the tenancy, as calculated on a weekly basis was approximately $1,905 per week. Taking all matters into consideration, I consider that a reasonable amount on account of rent reduction for the pool would be $100 per week, which would equate to a total deduction of $4,786.00.
  2. [58]
    The other claim for a rent reduction relates to the failure of the air-conditioning for varying periods over a number of areas in the premises.  There is considerable correspondence between Mr Kavvadas and the agent about such issue. Ms Kavvadas said in her statement that on moving into the property, she made mention to the agent, that one of the air conditioners didn’t work on the main level and the ducted system did not work in the three bedrooms on the middle level. She also said that the other air-conditioning system on the main level started to break down regularly and finally just stopped. Mr Kavvadas said in an email to the agent on
    14 January 2017, that the air-conditioning company (referring to its representative) came the previous day and said that the units are not repairable.  Surprisingly, the agent said to Mr Kavvadas, in an email of
    16 January 2017:

… Regardless of outstanding maintenance, you need to have the rental arrears paid within 24 hours. The owners will not be looking at spending any money on maintenance until the rental arrears are paid …

  1. [59]
    Clearly, both parties have not acted appropriately. The tenant ought not to have withheld payment of monies owing under the tenancy agreement because of outstanding maintenance issues, and the lessor through her agent, ought not to have deferred fulfilling maintenance obligations because of outstanding rent.
  2. [60]
    In an email from Mr Kavvadas dated 17 January 2017, to the agent, he said:

As I see it, a discount should be applied for a period of the past 3 months as the bedroom aircon has not worked, also the pool has not been able to be used plus the hot water system was not working for a period of 4 weeks and also is not working now. The recent failure of the hot water was yesterday. Please advise what your clients are prepared to offer in way of compensation. The property was in fact rented with full aircon and a pool. I don’t see as a big ask, merely trying to be fair. Also keep in mind only that through the duration of the lease, only one aircon unit has ever worked on the main level …

  1. [61]
    In a further email of 20 January 2017, he said:

… The property was leased to us on the provision it was fully air-conditioned plus a pool. The air-conditioning on the first level only worked to 20% of the ground floor since the beginning of the lease, and since November has stopped working completely

In early November, the complete system failed on the first level which has left us not being able to use this level at all …

  1. [62]
    In her statement of 6 August 2017, Ms Kavvadas said:

… In early November, I would not leave my bedroom as the heat was unbearable to anywhere else in the house. As for cooking, it was not even an option as it was far too hot to be on the main level and cooking would have been ludicrous. I have food delivery dockets to prove this is the case ...

  1. [63]
    Photographs filed with the Tribunal show that the premises had considerable glassed areas that faced onto the courtyard area. It is common knowledge, that such glassed areas do impact on inside room temperatures.
  2. [64]
    In a written statement from a witness, Anne Murdoch dated 6 August 2017, she said:

… I was a regular visitor of 4-5 times a week and would stay overnight at least once a week (at) 16 Wendell Street. Between August 2016 and March 2017, I personally experienced the unbearable heat on the lower ground of the Wendell Street house and was told that the air conditioning unit did not work on the lower ground. As a regular guest, we had to commune in Sharon Kavvadas’ bedroom as the casual living area on the ground was not usable as it was too hot and her bedroom was the only room that was cool enough to sit in. She informed me that this was where she was confined to permanently, as she could not bear the heat in the living area.

  1. [65]
    Mr Kavvadas has said that only three bedrooms were able to be used. He has provided a handwritten breakdown of the various claims he made for rent reduction.
  2. [66]
    It is abundantly clear that the tenant has experienced a substantial loss of air-conditioning to varying parts of the premises for the duration of the tenancy. Again, there is no precise mathematical calculation or determination by application of a formula, that can be applied to determine the monetary value of such loss. In considering the claim for rent reduction for both the pool and air conditioning issues, I have taken into account the relevant matters, including the description of the property as advertised for rent, the weekly amount of $1905 payable by way of rent, the age of the dwelling house, the extent to which the premises were said to have been affected by heat, the construction type and general layout of the premises, the reduced usage of all areas of the premises by the occupants and the likely impact that this would have had on the occupants, particularly over the summer months. I am satisfied that there has been a substantial decrease in both the amenity and standard of the premises that were to be provided under the tenancy agreement.  In respect of the period from
    8 April 2016 to 31 October 2016, representing a period of 29.57 weeks, I consider that the rent reduction on account of the air-conditioning issues should be $150 per week, which equates to the sum of $4,435.50
  3. [67]
    In respect of the further period from 1 November 2016 to the date of eviction on 8 March 2017, which represents a period of 18.286 weeks, I consider that the rent deduction on account of the air-conditioning issues should be   $250 per week, which equates to $4,571.50. Over this period, the failure was considerably more extensive throughout the premises and occurred over the summer months.
  4. [68]
    In summary, the rent reductions allowed are as follows:

Loss of use of pool      $4,786.00

Loss of use for air-conditioning from 8/4/16 to 31/10/16   $4,435.50

Loss of use for air-conditioning from 1/11/16 to 8/03/17   $4,571.50

Total rent reduction allowed as a credit                  $13,793.00

  1. [69]
    The final calculations are as follows:

Amount found to be payable by tenant to lessor   $80,213.73

Less insurance payment received   $24,767.85

Less total of rent reductions             $13,793.00    $38,560.85                   

 Total                               $41,652.88

  1. [70]
    The monetary jurisdiction of the Tribunal in respect of minor civil disputes is limited to $25,000.[13] I consider that this sum applies to tenancy matters notwithstanding the further provisions of s 516 of the Act and s 13 of the QCAT Act[14]. Claims for amounts in excess of the prescribed amount of $25,000, are able to brought in a court with jurisdiction for the amount being sought. The applicant has abandoned that part of the claim which is in excess of the jurisdictional limit of this Tribunal. However, she has sought orders that the Residential Tenancy Authority pay to her the sum of the bond of $10,000 and further that Ms Kavvadas also pay to her the sum of $25,000. In my view, the jurisdictional monetary limit applicable to this claim does not allow for the making of both orders, as that would result in this limit being exceeded.
  2. [71]
    The orders of the Tribunal will be as follows:
  1. The Respondent, Sharon Kavvadas shall pay to the applicant, Tracey Crampton the sum of $25,000.00.
  2. In part satisfaction of this order, the Residential Tenancy Authority shall pay to the lessor, Tracey Crampton, the bond amount in the sum of $10,000.
  3. The Respondent, Sharon Kavvadas shall pay to the applicant, Tracey Crampton, the balance of $15,000 within 14 days of the date of this order.

Footnotes

[1]LexisNexis, “Concise Australian Legal Dictionary”, 5th ed., 663.

[2]Robinson v Harman (1848) 1 Ex 850.

[3]LexisNexis, “Concise Australian Legal Dictionary”, 5th ed., 65.

[4]The Act, s 185(2).

[5]The Act, s 185(3).

[6]Gration v Gillan Investments Pty Ltd [2005] QCA 184.

[7]Proudfoot v Hart [1890] 25 QBD 42.

[8]The Act, s 166; Residential Tenancies and Rooming Accommodation Regulation 2009 (Qld), reg 22.

[9]Taxation Ruling TR 2016/1 (applicable to 30 June 2017).

[10]Masinello v Parker & Anor (No.2) [2013] QCATA 325.

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

[12]Ibid, [25].

[13]Queensland Civil and Administrative Tribunal Act 2009 (Qld), (QCAT Act), s 12(3) and Schedule 3 definition ‘prescribed amount’.

[14]Ibid, s 13.

Close

Editorial Notes

  • Published Case Name:

    North South Real Estate & Anor v Sharon Kavvadas

  • Shortened Case Name:

    North South Real Estate v Kavvadas

  • MNC:

    [2017] QCAT 306

  • Court:

    QCAT

  • Judge(s):

    Adjudicator Stanton

  • Date:

    08 Sep 2017

Appeal Status

Please note, appeal data is presently unavailable for this judgment. This judgment may have been the subject of an appeal.

Cases Cited

Case NameFull CitationFrequency
Gration v C Gillan Investments Pty Ltd[2005] 2 Qd R 267; [2005] QCA 184
2 citations
Jump To
Cite 1 - [2005] QCA 184
Cite 2 - [2005] QCA 184
Masinello v Parker & Anor (No.2) [2013] QCATA 325
2 citations
Jump To
Cite 1 - [2013] QCATA 325
Cite 2 - [2013] QCATA 325
Proudfoot v Hart (1890) 25 QBD 42
2 citations
Jump To
Cite 1 - (1890) 25 QBD 42
Cite 2 - (1890) 25 QBD 42
Robinson v Harman (1848) 1 Ex 850
2 citations
Jump To
Cite 1 - (1848) 1 Ex 850
Cite 2 - (1848) 1 Ex 850
Underwood v Queensland Department of Communities (State of Queensland)[2013] 1 Qd R 252; [2012] QCA 158
3 citations
Jump To
Cite 1 - [2012] QCA 158
Cite 2 - [2012] QCA 158
Cite 3 - [2012] QCA 158

Cases Citing

Case NameFull CitationFrequency
Avery v Pahwa [2018] QCATA 532 citations
Gould v Mazheiko & Gill [2020] QCATA 101 citation
Hicks v Bell Estate Agents [2021] QCAT 3132 citations
Li v Morgan Jade Heading ATF the JE Trust (No 2) [2021] QCATA 1072 citations
Sasip Pty Ltd v Ashe [2021] QCAT 992 citations
1

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