Sasip Pty Ltd v Ashe[2021] QCAT 99

QUEENSLAND CIVIL AND ADMINISTRATIVE TRIBUNAL

REASONS FOR DECISION

Claims

1. [1]
   This is an application by Sasip Pty Ltd as the owner of a property situated at Biggera Waters (“the tenancy”) and a counter application by its former tenants, Mr Ashe and Mr Huth.    At the relevant time of the tenancy, Stewart & Smyth Estate Agents were the managing agents for the tenancy and Mrs Barker was a director of the applicant. 
2. [2]
   On 14 September 2020, the applicants filed an application under various sections of the Residential Tenancies and Rooming Accommodation Act 2008 (Qld) (“RTRAA”) for an order that the respondents pay the applicant the sum of $12,414.55, being: 

Water $123.21; 

Rent arrears $3,112.86; 

Carpet replacement $3,000.00; and 

Vinyl replacement $6,178.48. 

3. [3]
   The claim for water was not disputed by the respondent tenants. 
4. [4]
   The claim for rent arrears was dealt with as an outcome of an earlier application^[1] by the respondents under regulation 12 of the Residential Tenancies and Rooming Accommodation (COVID-19 Emergency Response) Regulation 2020 (Qld) (“COVID19 Emergency Response Regulation”) wherein the parties reached an agreement by consent that the rent arrears would be fully waived.  
5. [5]
   The issues remaining in the applicant’s claim for this hearing were therefore with respect to compensation sought to replace the carpets and vinyl flooring in the tenancy. 
6. [6]
   The respondents had, prior to the hearing, offered the bond held by the Residential Tenancies Authority (“RTA”) in the sum of $2,740.00 in full and final satisfaction of the lessor’s claim but that was not accepted. 
7. [7]
   On 16 November 2020 the respondents made a counter application under sections 419, 420 and 429 of the RTRAA for an order that the applicant pay the respondents the sum of $3,445.11, being:

   1. (a)
      $650.00 for the bond at the new tenancy; 
   2. (b)
      $140.00 for carpet cleaning; 
   3. (c)
      $518.77 for vet expenses; 
   4. (d)
      $104.04 for truck hire; 
   5. (e)
      $179.50 for storage costs; 
   6. (f)
      $737.40 and $990.00 for removalists’ costs; and 
   7. (g)
      $125.40 filing fee.
8. [8]
   At the hearing on 17 December 2020, Ms Stewart, agent, represented the applicant in person and the respondents appeared by telephone, each party having provided written submissions to the Tribunal prior to the hearing. 

History 

9. [9]
   The tenancy commenced on 9 July 2018 at which point the property was in an as new condition, having been recently built by the respondent. 
10. [10]
    Routine inspections were undertaken until March 2020 and after that time entry was refused by the tenants on COVID-19 grounds.  A virtual inspection took place on 22 July 2020. There were no significant issues observed with the property in terms of odour or property damage at any routine inspection.

11. [11]
    The respondents are both disc jockeys, primarily employed at nightclubs and large events, an industry that suffered significantly during the COVID-19 emergency period on account of business closures pursuant to public health directions. 
12. [12]
    In matter MCD/T2064-20, the rent reduction case, the respondents gave evidence of their income prior to COVID-19, and that they had exhausted savings that they had intended to use as a house deposit maintaining their $685.00 per week rent payments after their income effectively ceased when public health directions forced closed the venues and events they were employed in.  
13. [13]
    The applicant had refused all but a $10 per week rent reduction, saying that the directors of the respondent, too, had suffered COVID-19 hardship requiring the sale of their home. 
14. [14]
    The then current term of the tenancy was due to end on 8 July 2020. 
15. [15]
    On 9 June 2020 the respondents were given notice to leave in Form 12 with a handover date of 10 August 2020.  Item 4 of the Form 12 stated as follows:

Without Grounds

Owner is wanting to occupy the property

16. [16]
    On 9 July 2020 Mr and Mrs Barker entered into a contract to sell their home, with a settlement date of 13 August 2020.^[2] 
17. [17]
    On 2 July 2020, the respondents secured another tenancy commencing 6 August 2020 but were later informed that their handover date would be delayed by one week.  They sought an extension to vacate the tenancy on 13 August 2020 and this was refused by the applicant lessor.  
18. [18]
    The respondents therefore vacated on 10 August 2020, going to the expense of a “double move” and it is these expenses they are seeking be reimbursed in their counter application, as well as anxiety mediation and veterinary expenses incurred which they say was a result of trauma to their pets occasioned by the double move.  

Jurisdiction

19. [19]
    Section 11 of the Queensland Civil and Administrative Tribunal Act 2009 (Qld) (“the QCAT Act”) 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 in relation to which a person may apply under the RTRAA.

20. [20]
    A tenant cannot apply to the Tribunal about an issue unless they have first sought Residential Tenancies Authority (RTA) conciliation and either the conciliation process has ended without agreement reached, or a compromise was reached but this has not been adhered to.^[3]
21. [21]
    The Notices of Unresolved Dispute are dated 28 July 2020 and 11 September 2020. 
22. [22]
    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.^[4] 
23. [23]
    Each party’s claim is under sections 419 and 420 for compensation for breach.
24. [24]
    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.^[5]
25. [25]
    I am satisfied that the parties have attempted the RTA conciliation process and that the application was filed within time.  

The applicant’s case

Evidence 

26. [26]
    The property was brand new when the tenancy commenced.  
27. [27]
    Ms Stewart undertook the exit inspection on 11 August 2020 and gave evidence in the hearing that the odour was overwhelming and “so pungent you could not miss it”.   
28. [28]
    Photographs included in the Exit Condition Report evidence extensive moisture staining to the underside of the carpet and the flooring beneath the underlay. These are time-stamped 4.34pm on 11 August 2020.  
29. [29]
    Ms Stewart emailed the applicants on 12 August 2020 stating, among other things, that: 

Summary of the report carried out yesterday.. there was an extremely pungent / foul smell of cat urine throughout the property. 

…

The carpet looks like it will need replacing.   After having the windows and doors open for hours, the smell is still extremely overpowering.   Plus the damage in the cupboard and close to the door to the bedroom. 

30. [30]
    Mr and Mrs Collitti performed the bond clean at the home on 10 August 2020.  They are the applicant’s preferred cleaners and the respondents say they aren’t truly independent for that reason.    
31. [31]
    Mr Collitti’s affidavit sworn 1 December 2020 says, among other things, that: 

In one of the rooms there was a very strong smell of cat piss. 

And under the stairs there was a yellow stain and it smelled like cat piss again.   

32. [32]
    Mrs Collitti states that:

The day we arrived we saw all the glass & windows are open and the fans are on.  Then came Sam and his partner & they let us in the house through the garage which is full of things & rubbish.  It was very messy.  …there is a bad smell it stinks.  Upstairs in the ensuite has that odor too. 

The next day Karen Stewart calls us asking us to go back  to …attend some issues… Went back and cleaned it the smell is still there especially under the stairs, in the skirting boards under the stairs have yellow dried liquid & when I wiped it, it smell of urine.^[6] 

33. [33]
    Quote No. 203465 from Choices Flooring Helensvale dated 11 August 2020 was tendered to support the claim for the replacement of all carpet in the premises.  It states simply that: 

Supply and install carpet over 10mm Form Underlay

Price includes uplift and disposal of old carpet and underlay. 

Price $3,000

*Carpet is like for like replacement. Carpet is damaged and not repairable. 

34. [34]
    The applicant submitted that, although only three years old, the carpet and vinyl colouring could not be matched, hence the entire upstairs (carpet) and downstairs (vinyl) needed to be replaced. 
35. [35]
    The applicant says the pungent odour remains in the property as the vinyl has not yet been replaced. 
36. [36]
    Mrs Barker of the applicant said that when the carpet was taken up, the smell was unbearable in all areas upstairs, that the carpet had been soaked in pet urine and that the timber floor underneath was also stained. 
37. [37]
    A quote from Choices Flooring Helensvale dated 19 August 2020 for vinyl was tendered to support the claim for the replacement of the vinyl flooring in the premises.  It states that: 

Vinyl is damaged beyond repair.  It has been contaminated with pet urine throughout. 

Installer has inspected site and confirmed glue is adhering to concrete.  Glue will need to be grinded off. 

Prior to Choices Flooring starting any work, we request the floor be hygienically cleaned as it’s a health hazard to our installers. 

Reply evidence

38. [38]
    The respondents produced the following in reply evidence: 

    1. (a)
       Report dated 30 July 2020 by Pets That Rent;
    2. (b)
       Routine Inspection Reports;
    3. (c)
       Reference letter dated 17 June 2020 from Stewart & Smyth Real Estate; 
    4. (d)
       Emails from Jason L (Pets That Rent) dated 17 August 2020 and James Brown (Carpet Cleaner) dated 13 August 2020; 

5. (e)
   Carpet cleaning receipt dated 8 August 2020 from James Brown; and 
6. (f)
   Pets That Rent invoice no. 7383-M dated 30 July 2020 for the sum of $225.00. 

39. [39]
    They say that the carpets and flooring were not damaged to the extent claimed by the lessor and that any damage that was caused by their pets was minor, that they were willing to pay for one area of the upstairs carpet due to an accident their dog had, but otherwise they say that any damage or odour was rectified entirely by the cleaning they had undertaken. 
40. [40]
    The reference letter notes that the respondents “have been excellent tenants” and that “the property has been well maintained throughout the tenancy”.   The applicants say that this was given in order to assist the tenants to obtain alternative accommodation, and say further that, at the time the reference was given, they had not undertaken a recent on-site property inspection and the issues of odour had not yet arisen. 
41. [41]
    The routine inspection reports include statements that the “property is clean and there is (sic) no marks or damage”.
42. [42]
    The email from James Brown carpet cleaner includes the following statement: 

I attended [the property] on Saturday the 8^th of August.  First the carpets were given a thorough vacuum throughout.  Done with a tenant (sic) commercial vacuum cleaner. 

…The carpet were (sic) sprayed with carpet detergent and then the carpets were washed and the chemical was extracted.   There were some marks in the carpet, but with the application of the correct chemicals all the stains were removed. 

…I chose to spray a commercial grade carpet deodorant into the carpet undiluted after cleaning, and rake the chemical into the carpet.   When I had finished I felt confidant (sic) that all the problems had been neutralised. 

43. [43]
    The Pets That Rent report dated 30 July 2020 provided, among other things as follows: 

Pets: 2 cats & 1 dog

There is some scratch damage to the carpet in the upstairs living area/landing that may require repair, particularly at the entry to the upstairs laundry cupboard. 

We took swabs from each square meter in the house, from both above and under the carpets, from the top side of the hard flooring, and we used the aspiration method to obtain samples from in between the seems (sic) and under the planks (we pump a sterile solution in between the planks and then immediately pump the liquid back out through a syringe which allows us to analyse any substances that are present in hard to reach areas). 

These confirmed a small amount of dog urine on the upstairs living area/landing carpets – these had obviously been taken care of and cleaned at the time and is something that a professional carpet shampoo should take care of fully as the levels detected were very low.  Most of the stains on the underside of the area’s carpets tested negative for urine or vomit, returning results of mainly cleaning products. 

There were trace amounts of cat urine in the area of hard flooring under the stairs. I believe this is where you kept the cat litter trays.  Only the swab tests displayed any readings of urine – all aspirations from between the planks and under the planks were clear.  The readings in this area were so low that it appears to be incidental surface readings, most likely from the cats (sic) paws as they exit their litter tray.  These should be completely taken care of with a mop and bleach.   All other tests of the hard flooring were clear. 

Upstairs… No odors.

Upstairs living area… Swab tests of this area showed very small amounts of dog urine remaining.  Swab tests from the majority of the underside stains were negative of any soiling and only returned results of cleaning detergent and bicarbonate soda.   

44. [44]
    There were no photographs or test results from the “swabs” taken attached to the report.   By contrast for example, mould or methamphetamine inspection reports that refer to tests, swabs and moisture readings usually attach photographs of the instruments used to take the readings and the test results.    
45. [45]
    The report, cover letter, tax invoice and emails also omitted any telephone number for “Pets That Rent”. 
46. [46]
    The email from “Jason L” from Pets That Rent dated 17 August 2020 was sent in reply to an email from Mr Huth wherein Mr Huth asked for advice on the agent’s accusation that there is extensive damage to the carpet in the upstairs landing area, and that the property “reeks of pee”.  “Jason” replied: 

Hi Sam. No way mate, most of the “damage” in those photos is actually just from the carpet clean and shampoo.  There were a few yellow/bleach stains when we did the report but they were old and had been taken care of. 

…

There was absolutely no odor when we did the report and the levels of urine found were so low that there is no way that house smells the way your real estate agent is saying it does. 

Sounds to me that you have one of those landlords that thinks having had pets in the property is a quick and easy way to make a buck. 

47. [47]
    The applicant queried why the respondents had not produced the Pets That Rent evidence prior to lodging their counter application, despite an earlier hearing between the parties and mediation attempt.
48. [48]
    In terms of quantum, the respondents also relied upon the applicant’s bank statements that evidence only one payment to Choice Flooring on 1 September 2020 in the sum of $1,210.00.  They say that carpet quote is not an invoice or receipt and that the best evidence of what the lessor paid to replace carpets is that payment of $1,210.00.
49. [49]
    However, the reference for that payment is “carpet balance Inv 302430”.   An earlier payment of $1,500.00 is evidenced on 11 August 2020 for Quote 203465. 
50. [50]
    Invoice 302430 was not provided to the Tribunal, however the agent said that the owners received a discount from the $3,000 quote for taking up and disposing of the existing carpet themselves.  The total paid for the carpets was therefore $2,710.00 including GST.  Net of goods and services tax I calculate the loss to the applicant to be in the sum of $2,463.64. 

Tribunal evidence 

51. [51]
    The Tribunal may inform itself in any way it considers appropriate.^[7] 
52. [52]
    The Pets That Rent service was not a service I had previously heard of.  The report and correspondence were, as noted, somewhat unusual given that they were bereft of a contact phone number, photographs and test results, and I had no clarity as to whether the inspectors had a background in cleaning, veterinary care or any like field to qualify them to write the report they did.  
53. [53]
    Out of interest therefore, when reviewing material prior to the hearing, I undertook research from information publicly available online in an attempt to inform myself as to the nature of the service and the qualifications of those undertaking the testing and giving opinions. 
54. [54]
    I was not readily able to find Pets That Rent or any similar service by undertaking a Google search.   In fact, I could not find a webpage for the service until I directly entered the domain name as a web address. 
55. [55]
    The results of my research were tendered in the hearing as follows: 

    1. (a)
       ABN Lookup search^[8] - this established that the ABN displayed on the Pets That Rent tax invoice was in the name of Jason Lansdell, sole trader of “Slushie Heaven” and “Action Entertainment & Promotions”.  There was no business name “Pets That Rent” attributed to the ABN; 
    2. (b)
       “Slushie Heaven” website homepage^[9] - this included a promotion of Jason Lansdell as “DJ J-Zan”; 
    3. (c)
       Pets That Rent website homepage^[10] - a very basic holding page with a “contact us” inquiry form and nothing else; and
    4. (d)
       Whois domain registry search^[11] - recording that the domain “petsthatrent.com” was registered on 19 November 2020. 
56. [56]
    During the hearing when asked how the tenants came to engage Pets That Rent, Mr Ashe explained that: 

    1. (a)
       Pets That Rent was “somebody a friend knew of” so he “looked him up online”; 
    2. (b)
       He and Mr Huth decided to engage an “independent third party”^[12] to give a preexit report specific to pet damage in properties because they were concerned about conduct of the lessor they described as “retaliatory” since they first requested rent reduction during the COVID-19 emergency period; and 
    3. (c)
       He wasn’t sure of the qualifications of Pets That Rent but that “Jason said he did this sort of thing” and was “happy to come out”. 
57. [57]
    When the Tribunal evidence was then put to the respondents, I also explained the implications of section 48 of the QCAT Act.  
58. [58]
    I put it to the respondents that the Pets That Rent evidence appeared to be a deliberate effort to mislead the Tribunal and the applicant.   They conceded that they were connected with Mr Landsell on social media and knew him personally and offered to withdraw the report.  Mr Ashe denied they had attempted deceit and said that they simply “did not know” that Pets That Rent “weren’t qualified” to undertake the inspection.   

Attempt to deceive 

59. [59]
    Section 48 of the QCAT Act empowers the Tribunal to dismiss or strike out proceedings if it considers that the person who brought the proceedings (the applicant) has acted in a way that unnecessarily disadvantages another party to the proceedings, including, among other things, by^[13] (my emphasis added):

    1. (a)
       Not complying with an order or direction of the Tribunal without reasonable excuse;
    2. (b)
       Attempting to deceive another party or the Tribunal; or
    3. (c)
       Vexatiously conducting the proceeding.
60. [60]
    Where it is the respondent who is causing the disadvantage, the Tribunal can make its final decision in the applicant’s favour,^[14] dismiss the counter-application and may also order the party who caused the disadvantage to compensate the other party for any reasonable costs incurred unnecessarily.^[15]
61. [61]
    In making any of these orders, the Tribunal must consider:^[16]

    1. (a)
       whether the party causing disadvantage is familiar with the Tribunal’s practices and procedures;
    2. (b)
       the party’s capacity to understand, and act on, the Tribunal’s orders and directions; and
    3. (c)
       whether the party is deliberately acting to disadvantage other parties.
62. [62]
    In Tracey v Olinderidge Pty Ltd & Wagner [2015] QCAT 7, Member Hughes distinguished mere disadvantage from unnecessary disadvantage in analysing the law and case precedent.
63. [63]
    Tribunal Member Dr JR Forbes in Arowana Pty Ltd (t/a Choice IT Australia) v Scott [2019] QCATA 100 at [19] summarised that the responsibility of litigants in the Tribunal to attend to their own interests is emphasised by a former President of the Tribunal, Justice Wilson, in The Pot Man Pty Ltd v Reaoch [2011] QCATA 318 at [9]-[10]:^[17]

The QCAT statutory regime itself places obligations upon parties to take care in dealing with tribunal matters … The legislation and the demands upon public resources which fund QCAT, necessarily impose an expectation and an obligation upon a party that it acts in its own best interests, or accept the consequences.

64. [64]
    In Laffey & Coastalite Pty Ltd v L & V Project Pools Pty Ltd [2019] QCAT 238^[18] Adjudicator Alan Walsh noted that:

Most parties to proceedings in the minor civil dispute jurisdiction of the Tribunal are unrepresented, legally inexperienced lay people. It follows that the Tribunal will be careful and circumspect before invoking the sanction in section 48(2) where it is perceived that an unrepresented litigant has behaved unacceptably in the course of a Tribunal proceeding.

65. [65]
    I am well satisfied and therefore find that the respondents acted deliberately in fabricating evidence intended to deceive the Tribunal and the applicant, and that they did so in a meticulous and concerted effort to defeat or at least reduce (to the bond amount) the applicant’s claim.   
66. [66]
    The consequence of that finding in this case could have been a ruling that the applicant succeeds in its claim against the respondents, and that the respondents fail in their counter application, applying section 48(2) of the QCAT Act, independently of any consideration of the merits of the claim.   Whilst such an outcome may well be harsh, this case is, in my view, certainly an example of where it might be an appropriate punishment. 
67. [67]
    However, I am mindful that the fabrication occurred very late in proceedings, thus minimising the disadvantage to the applicant and to the Tribunal.  
68. [68]
    Further and more importantly, I note the particular hardships and stresses that the COVID-19 pandemic visited upon these tenants in particular, given both were employed in an industry that was closed down and that in that environment, they also found themselves on the receiving end of an early termination of their tenancy.^[19] 
69. [69]
    To a large extent the respondents were disadvantaged by their lack of understanding of their rights and the remedies available under the RTRAA and COVID-19 Regulations.   For example, 

    1. (a)
       had they preserved their savings and breached their tenancy agreement by failing to pay rent much earlier, their claim under section 12 (rent reduction) would have been far greater.  The Tribunal was, at the time of their hearing, limited to making a decision on the then “unpaid rent”;  
    2. (b)
       had they simply remained in the tenancy after the handover date for an additional week, practically they would have avoided the inconvenience and expense of a double move because the applicant could not have applied to the Tribunal and obtained a warrant for possession in that time; and
    3. (c)
       had they challenged the Notice to Leave at the time it issued, they might have been able to remain in the tenancy.   
70. [70]
    On balance, I am not inclined to apply section 48(2) and instead elect to consider the claim and the counter claim on their respective merits. 

Compensation under the RTRAA

71. [71]
    An application for compensation pursuant to section 419 of the RTRAA must be made within six months of the (in this case) applicants “becoming aware of the breach”.  I am satisfied that this application and the counter application are not time-barred.
72. [72]
    Under section 420 of the RTRAA the Tribunal may make an order for the payment of money or an order for compensation on an application about a breach. 
73. [73]
    To be successful in their claim the applicant must establish a breach by the respondents (and the respondents must establish a breach by the applicant with respect to their counter application).  
74. [74]
    At the end of the tenancy the tenant must leave the premises as far as possible in the same condition they were in at the start of the tenancy, fair wear and tear excepted.^[20] Therefore, the decision of the Tribunal requires consideration of evidence of the condition of the property at the start of the tenancy, evidence of its condition at the end, and if there is a difference (a worsening) then considering whether the deterioration is explained by fair wear and tear or whether it goes beyond that. 
75. [75]
    In Griffin v Gini^[21] Judge Fleur Kingham, Deputy President said:  

In general, the ordinary meaning of the phrase is concerned with the consequences of ordinary, not extraordinary damage (JSM Management Pty Ltd v QBE Insurance (Australia) Ltd [2011] VSC 339, [36]). In the case of “wear”, this might mean, for example, fading paint work on internal and external walls caused by sunlight over time; “tear” refers to disrepair caused by a tenant through unintentional action or through the normal incident of a tenant’s occupation (Taylor v Webb [1937] 2 KB 283, 302). Depending on the specifics of the obligations outlined in a tenancy agreement, this might include the accidental ripping of an aged, worn fly screen. In summary, fair wear and tear, in the context of a residential tenancy, refers to damage or disrepair caused or resulting from ordinary use.   

76. [76]
    In North South Real Estate & Anor v Kavvadas^[22] the Adjudicator said:

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.

77. [77]
    Compensation is intended to put the complainant back, so far as money can do it, into the same position as if the damage had not occurred.^[23]  
78. [78]
    In the case of damage to property, this is usually:  

    1. (a)
       diminution of value in the property (the cost of repair);^[24] and  
    2. (b)
       consequential losses but subject to: 

1. (i)
   betterment/allowance for depreciation;  
2. (ii)
   reasonableness and duty to mitigate; and 
3. (iii)
   remoteness.

79. [79]
    The diminution in value is immediate when the damage occurs, so it is not a condition precedent to the claim that a repair has been done incurring expense.^[25] Where a reasonable substitute is available for a price significantly less than the cost of repair then the replacement cost is the correct measure of the damages.^[26] 
80. [80]
    Betterment is when an award would place a lessor in a better position than if the breach had not occurred in the first place. This might arise for example, where a lessor replaced an old heavily soiled and stained carpet and claimed the whole cost of this from the tenant responsible for a stain. It may be true in such a case that the lessor would not have replaced the carpet if it were not for the new stain, and so on the face of it the cost of the new carpet is the lessor’s loss. But in such a case, it would be fair that the lessor give credit for the betterment.^[27]  
81. [81]
    In Fankhauser v Mission Beach Property Management [2017] QCATA 65 carpet with a replacement cost of $2,500 was damaged by the tenant and had to be replaced. The tribunal awarded the lessor $1,800, reduced to $500, pointing out that since the carpet was eight years old and probably had a lifespan of 10 years, it had a life left of two years. 
82. [82]
    Matching colours and type of carpet are common difficulties. The aim is to reach a figure which provides reasonable compensation. 
83. [83]
    Section 362 of the RTRAA provides that if the lessor suffers loss because of an act or omission of the tenant, the lessor must:^[28] 

    1. (a)
       take all reasonable steps to mitigate the loss or expense; and 
    2. (b)
       is not entitled to receive compensation for any loss or expense that could have been avoided by taking the steps. 
84. [84]
    It is thought that this is simply a restatement of the common law duty to mitigate and the use of the words ‘all reasonable steps’ does not establish a more onerous duty than a requirement that the lessor act reasonably in taking the course decided upon.^[29]
85. [85]
    The size, type and position of carpet stains may justify replacement of the carpet in a well-appointed and luxuriously fitted out room, but specialist cleaning, patching or covering with a mat are alternatives which ought to be considered as part of the duty to mitigate loss. 

Findings 

Carpet 

86. [86]
    Where odour in carpets is the issue, it is usual, in my experience for a lessor to first attempt a thorough clean of the carpets. This was not attempted, nor does it appear to have even been contemplated.  The best evidence of this is that the quote to fully replace the carpets was given on the date of the exit inspection, the exit inspection having taken place at 4.30pm.  
87. [87]
    Further, given the close proximity of the timing of the quote and the exit inspection, no reasonable attempt appears to have been made to colour match replacement carpet (or the vinyl).  Given that the carpet was only three years old, this is quite surprising.  
88. [88]
    Finally, having viewed photographs of the carpet, I am not of the view that it (a) could not be matched and, therefore, (b) that it was necessary to recarpet the entire upper floor (including two rooms that were not affected by staining). 
89. [89]
    Prior to exit, the tenants received complimentary routine inspection reports and no mention is ever made of odour.  This suggests that any urine staining or odour would have been confined to habits of the pets that took place in 2020 only.    Whilst this seems an unlikely change to pet behaviour, it is less unlikely during a year in which pet owner behaviours changed, including by being home more often due to job losses and work from home arrangements.  It is also possible that the pets were always prone to toileting issues but that the tenants prior to their change in financial circumstances, the deterioration of their mental health, and their disputes with the owners throughout 2020 adjusted their attitude/behaviours towards cleaning.    Alternatively, the odour has been brought out of the carpet by the carpet cleaning process.  This is very common in tenancy matters. 
90. [90]
    On balance, I am convinced that the upstairs carpets were extensively stained beyond what was mere fair wear and tear during the tenancy and I find the following evidence compelling in this regard: 

    1. (a)
       The frank words of Mr and Mrs Collitti, the bond cleaners, about the odour that struck them on 10 August 2020;
    2. (b)
       The evidence of Ms Stewart and Mrs Barker with respect to the odour; 
    3. (c)
       The compelling photographs of extensive moisture staining to the carpet, that has soaked through underlay to the floor beneath; and 
    4. (d)
       The implications I draw from the concerted effort made by the respondents to fabricate evidence to contradict the applicant’s evidence. 
91. [91]
    I accept the evidence of the applicant that the cost of the replacement carpet was $2,710.00 but I note the applicant’s entitlement to an input tax credit and reduce the claim to its net loss of $2,463.64. 
92. [92]
    Applying a principle of betterment, I reduce that claim by 20% (given that the carpet was two years old with an expected life of 10 years) to $1,970.00.
93. [93]
    I make a further reduction of one quarter to $1,478.00 because the lessor has not satisfied the Tribunal that it acted reasonably in failing to attempt a re-clean of the carpets and in further making no reasonable effort to match the carpet in the rooms that were not damaged and therefore ought not reasonably to have required replacement.     
94. [94]
    The reduction reflects my reasonable estimate of the value of the carpet of those two unaffected rooms vis-à-vis the remaining area of the upper floor, utilising the sketch plan included in the Pets That Rent Report that both parties agreed was an accurate depiction of the layout of the property. 

Vinyl 

95. [95]
    Unlike the carpet, the vinyl quote was obtained after a site inspection and the photographs are less convincing of extensive wet staining than those produced of the carpets.  
96. [96]
    Again, as mentioned with the carpet, prior to exit, the tenants received complimentary routine inspection reports and no mention is ever made of odour, but it is possible that the habits of both the pets and the tenants may have altered during 2020 when onsite inspections did not take place. 

97. [97]
    On balance, I am convinced that there is an odour in the premises that has remained after the stained carpets were replaced and therefore that the vinyl damage is beyond what was mere fair wear and tear during the tenancy.  I again refer to the following evidence: 

    1. (a)
       The frank words of Mr and Mrs Collitti, the bond cleaners, about the odour that struck them on 10 August 2020;
    2. (b)
       The fact that the flooring quote was obtained after an inspection and refers specifically to a requirement that the owners sanitise the floor to keep the installers safe;
    3. (c)
       The evidence of Ms Stewart and Mrs Barker with respect to the odour; 
    4. (d)
       The photographs of what looks to be urine staining beneath the vinyl; and 
    5. (e)
       The implications I draw from the concerted effort made by the respondents to fabricate evidence to contradict the applicant’s evidence to escape liability. 
98. [98]
    I place the most weight on the attempts by the tenants to fabricate evidence in this regard.   Their actions convince me that they are well aware of the issue in the tenancy upon vacate and they went to great lengths to cover it up. 
99. [99]
    With respect to the vinyl, the cost of the new vinyl is $4,528.48 and to take up the previous vinyl and grind the concrete to remove glue is $1,650.00 for a total of $6,178.48.  
100. [100]
     I note the applicant’s entitlement to an input tax credit and reduce the claim to its net loss of $5,616.80. 
101. [101]
     Applying a principle of betterment, I reduce that claim by 20% (given that the vinyl flooring was two years old with an expected life of 10 years) to $4,493.44.

Water

102. [102]
     By consent I award the applicant the sum of $123.21 for outstanding water charges. 

The counter application 

The Notice to Leave

103. [103]
     The Notice to Leave on the grounds of owner occupation was issued pursuant to regulation 37 of the COVID-19 Emergency Response Regulation that provided, relevantly, that a lessor could give a notice to leave to a tenant “if the lessor… needs to occupy the premises”. 
104. [104]
     The respondents argued that the notice to leave was wrongfully given because the lessor, a company, did not and could not occupy the premises. Rather, they point out, its directors personally took up occupancy.   In those circumstances, the respondents say that they ought not to have been made to leave the tenancy until after the COVID19 emergency period expired on 29 September 2020. 
105. [105]
     There is no evidence that regulation 37 was intended to apply only to individuals as lessors who found themselves suffering COVID-19 hardship. 
106. [106]
     The term “lessor” is defined in section 8(1) of the RTRAA to mean “the person who gives the right to occupy residential premises under a residential tenancy agreement”.   
107. [107]
     Section 32D of the Acts Interpretation Act 1954 (Qld) provides as follows: 

32D References to persons generally

1. (1)
   In an Act, a reference to a person generally includes a reference to a corporation as well as an individual.
2. (2)
   Subsection (1) is not displaced merely because there is an express reference to either an individual or a corporation elsewhere in the Act.

Examples of references to a person generally—

another anyone no-one one party person someone whoever

Examples of express references to a corporation—

body corporate company corporation sole

…

108. [108]
     There is no doubt in my mind therefore that the lessor, Sasip Pty Ltd, was able to give the notice. 
109. [109]
     As to whether or not Sasip Pty Ltd took up occupation of the premises: 

     1. (a)
        I find on balance that the lessor did occupy the premises on the grounds that the parties comprising all of its directors and shareholders took up occupancy of the premises; and 
     2. (b)
        In any event, if regulation 37 was misused by the applicant and if the respondents sought to challenge it on those grounds, they had two courses of action open to them upon receipt of the notice: 

        1. apply to the Tribunal to set the notice aside; and/or 
        2. report the matter to the Residential Tenancies Authority for investigation under regulation 40; and they did neither. 
110. [110]
     Notably, the Notice purported to be given “without grounds” but named grounds as “owner is wanting to occupy the property”.   In any event, had the matter proceeded to a termination hearing grounded upon the notice to leave, section 349 of the RTRAA permits the tribunal to make the termination order, even though the notice to leave contains a defect.  In short, nothing turns in this hearing on the error contained in the notice. 

Moving costs and associated losses

111. [111]
     The respondents themselves gave the evidence in the hearing that their double move was triggered by a delay in the tenancy to which the respondents were moving becoming available.   It was not caused or contributed to by any action of the lessor that breached the RTRAA or the tenancy agreement.  
112. [112]
     Although in my view, it would have been reasonable and appropriate for the applicant to grant the tenants their extension, they were under no legal obligation to do so to accommodate the tenants’ changed circumstances.  
113. [113]
     On that basis there is no breach upon which the respondents’ counter application for compensation can be made and it is dismissed on its merits on that basis.