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McGrath Property Management Bulimba v Christoe & Van Der Woude QCATA 159
McGrath Property Management Bulimba v Christoe & Van Der Woude  QCATA 159
McGrath Property Management Bulimba
Ian Van Der Woude
On the papers
Senior Member Stilgoe OAM
5 November 2015
APPEAL – LEAVE TO APPEAL – MINOR CIVIL DISPUTE – TENANCY DISPUTE – where claim for damage to floorboard – where tenant applied different coating – where tenant then removed coating – where claim for flooring disallowed – where tribunal referred to s 362 of Residential Tenancies and Rooming Accommodation Act 2008 (Qld) – whether grounds for leave to appeal
APPEAL – LEAVE TO APPEAL – MINOR CIVIL DISPUTE – TENANCY DISPUTE – where claims for replacement of missing remote and repair to paintwork dismissed – whether grounds for leave to appeal
APPEAL – LEAVE TO APPEAL – MINOR CIVIL DISPUTE – TENANCY DISPUTE – WATER CHARGES – where tenancy agreement required quarterly invoicing of water charges – where water charges not invoiced quarterly – whether lessor entitled to recover all water charges invoiced – whether grounds for leave to appeal
APPEAL – LEAVE TO APPEAL – MINOR CIVIL DISPUTE – TENANCY DISPUTE – where tenant attached a fixture to tenancy without prior agreement – where breach of tenancy agreement waived – where later claim for compensation – where tribunal dismissed claim for compensation – whether grounds for leave to appeal
Residential Tenancies and Rooming Accommodation Act 2008 (Qld) ss 207, 209, 362
Dearman v Dearman (1908) 7 CLR 549
House v The King (1936) 55 CLR 499
Lovell v Lovell (1950) 81 CLR 513
Fox v Percy (2003) 214 CLR 118
Pickering v McArthur  QCA 294
Chambers v Jobling (1986) 7 NSWLR 1
APPEARANCES and REPRESENTATION (if any):
This matter was heard and determined on the papers pursuant to s 32 of the Queensland Civil and Administrative Tribunal Act 2009 (Qld) (QCAT Act).
REASONS FOR DECISION
- McGrath Property Management Bulimba managed a property in East Brisbane of which Michelle Christoe and Ian Van Der Woude were tenants. At the end of the tenancy, McGrath filed a claim for compensation on five bases: damage to the timber floors; loss of a garage remote control; repairs to paint work; water charges and the cost of removing a fridge tap. The tirbunal rejected all McGrath’s claims except for a nominal amount of water charges.
- McGrath wants to appeal that decision. Because this is an appeal from a decision of the tribunal in its minor civil disputes jurisdiction, leave is necessary. Leave to appeal will usually be granted where there is a reasonable argument that the decision is attended by error, and an appeal is necessary to correct a substantial injustice to the applicant caused by that error.
- As to the claim for damage to the polished floors, McGrath submits the tribunal erred in considering s 362 of the Residential Tenancies and Rooming Accommodation Act 2008 (Qld) (RTRA Act) instead of ss 207 to 209. It says the tribunal wrongly assumed there was no evidence of the existence of the remote control for the garage. It says the tribunal dismissed its claim for the cost of repairing the walls without applying any legal principle or reasoning. It says the tribunal misapplied s 419(3) of the in deciding the claim for water charges. It says the tribunal wrongly applied s 206 of the RTRA Act, not ss 207 to 209, when considering its claim for the addition of the water tap.
The claim for the polished floors
- McGrath submits that the tribunal should have considered ss 207 to 209 when dealing with the claim relating to the polished floor. Section 207 states that a tenant may attach a fixture, or make a structural change to the premises, only with the lessor’s agreement. Section 208 deals with what is required for an agreement about a fixture or structural change. Section 209 deals with changes made without agreement.
- The tenants did not make a structural change to the floor. They applied a different finish to the floor which could be, and was, removed. The tribunal’s failure to refer to ss 207 to 209 is not an error.
- McGrath also submits that the tribunal focussed on the lessor’s duty to mitigate its loss without making any findings about the loss the lessor suffered as a result of the incorrect product.
- The evidence can support the tribunal’s findings. The exit report indicated that the coating damaged the floor. KleaningKing provided a letter to the tribunal stating that, being aware of the exit report, it removed the coating and left the floors in good condition. The lessor’s quotes to re-sand the floor were provided very soon after the date of the exit report. There is no evidence as to whether the contractor saw the floor before, or after, KleaningKing did its work.
- Even if McGrath was correct in submitting that the coating did damage the floor, it has not taken issue with the tribunal’s observations that damage to part of a floor does not necessarily entitle a lessor to claim the costs of a complete refurbishment of the whole floor. Despite the tribunal’s strong language, the principle it applied is correct; the tribunal will not make an order for compensation if the result is substantially better than what existed at the time the tenant entered into occupation.
The claim for the remote
- The tribunal’s reasons do not address the claim for a replacement remote control. That is an error, for which leave to appeal should be granted.
- McGrath submits that the entry condition report was evidence of the existence of the missing remote control. The exit condition report prepared by McGrath notes that one white garage remote was missing.
- The entry condition report simply states “double lock up with remote”. There is a photograph of keys and remotes noting that Ms Christoe collected these on 20 December 2013. The photograph shows three remotes, none of which is white. Mr Van Woude told the tribunal that they never received a white remote.
- Ms Mooney, for McGrath, told the tribunal that she did not have the white remote on the key register. That evidence is consistent with the photographs showing the keys that Ms Christoe collected. It is also consistent with Mr Van Woude’s evidence that they did not receive a white remote.
- McGrath has not established that the tenants received a remote that they did not return. There is no substantial injustice arising from the tribunal’s failure to deal with this point. The appeal is dismissed.
The claim for the cost of repairing the walls
- McGrath claimed $235 for touching up paint in bedrooms 2 and 4 and patching a dent below the stairs into the garage. The entry condition report records hooks and damaged paint in bedroom 4. It also records white and yellow stains throughout the garage and holes in the wall. The tribunal accepted this evidence and found that the cost of repairs covered pre-existing damage.
- The evidence can support the tribunal’s findings and I can find no compelling reasons to come to a contrary view. The invoice for repairs did not differentiate between pre-existing damage and damage caused by the tenant. Even if the tribunal did find the tenants caused some damage, it had no evidence by which it could apportion the cost of repair. The tribunal was not in error.
The claim for water charges
- The tenancy was water compliant and, by special condition 11, the tenants were required to pay for water. Special condition 11 also provided that the agent would forward a quarterly invoice for water, which was payable within 1 month of the tenant receiving the invoice.
- McGrath sent the tenants an invoice on 5 March 2015 for the period July 2014 to February 2015. Behind that invoice was a part copy of Urban Utilities’ bill for the period July 2014 to October 2014. Hand written notations on the invoice suggest that McGrath obtained a final reading and then calculated the amount payable by reference to the rates on the Urban Utilities’ invoice.
- McGrath should have rendered an invoice for water in October. Apparently, it did not. It should have received an invoice from Urban Utilities, and billed it on to the tenants, in January 2015. Apparently, it did not. Instead, McGrath billed nine months’ water charges in one invoice.
- The timing of invoices for water charges, when payment is due and when a breach arises for failure to pay for water is a vexed question for owners, tenants and the tribunal.
- Section 419(3) of the RTRA Act states that an application for compensation for breach of a tenancy agreement must be made within 3 months of the breach. Strictly, there can be no breach until a demand is made. Therefore, applying special condition 11, the tenants could not be in breach of the obligation to pay water charges until one month after McGrath’s invoice of 5 March 2015.
- But McGrath was already in breach of its obligations to invoice water charges quarterly. Section 421(1)(d) states that, in making an order for compensation in favour of a lessor, the tribunal must consider whether the lessor met its duty under s 362 to mitigate its loss or expense. Section 362(3)(b) states that a lessor is not entitled to receive compensation for any loss that could have been avoided by taking reasonable steps.
- Issuing quarterly invoices is not only a reasonable step, it is required by the tenancy. It is, in my view, unreasonable for a lessor to withhold water charges, issue an invoice that covers a significant period and a significant amount, and then be surprised if the tenant cannot, or will not, pay the full amount. A tenant is entitled to be made aware of the cost of water consumption as and when the invoices fall due. The failure to pass the costs on is a breach of the lessor’s duty to take all reasonable steps to mitigate its loss.
- Because it was faced with a breach of both the tenancy agreement and s 362 of the RTRA Act, the tribunal was obliged to exercise its discretion to determine fair compensation. Where there is an appeal against the way the tribunal exercised a discretion, the Appeal Tribunal will not interfere unless it can be shown that the tribunal acted upon a wrong principle, or made mistakes of fact which affected the decision, or was influenced by irrelevant matters. Just because the Appeal Tribunal might have exercised the discretion differently, is not a basis for changing the decision: it must be shown that the decision is plainly unjust or unreasonable, and involved a clear misapplication of the discretion.
- I can find no wrong principle. I can find no mistake of fact which affected the decision. I can find no evidence that the tribunal acted upon irrelevant matters. There is no reason to interfere with the tribunal’s exercise of its discretion.
The claim for the tap
- McGrath rightly submits that the claim for the tenants’ addition of the tap calls for a consideration of ss 207 to 209 of the RTRA Act. The tap is an additional fixture. The evidence suggests that the tenants fitted the tap without approval. Section 209 provides that, if the tap was fitted without agreement, the lessor may waive the breach and treat it as an improvement instead of taking action for breach of the term.
- McGrath emailed the tenants on 4 March 2014, almost a year before they vacated. It stated:
Firstly the installation of the plumbing works to the kitchen for the fridge. He [the lessor] is very upset that this was done without approval … After lengthy discussions they have agreed to let this one slide with a warning…
- This email is clear evidence that the lessors elected to waive the breach and treat the tap as an improvement. The lessor is, therefore, precluded from claiming compensation for its removal.
- Leave to appeal should be granted on the limited ground that the tribunal made no finding about McGrath’s claim for the replacement of a missing remote. However, because the claim was not supported by the evidence, the appeal is dismissed.
 QCAT Act s 142(3)(a)(i).
 Pickering v McArthur  QCA 294 at .
 Transcript page 1-27 lines 23 - 27
 Transcript page 1-27, lines 29 - 40
 Dearman v Dearman (1908) 7 CLR 549 at 561; Fox v Percy (2003) 214 CLR 118 at 125-126.
 Chambers v Jobling (1986) 7 NSWLR 1 at 10.
 Transcript page 1-20.
 Transcript page 1-19, line 45.
 Transcript page 1-29, lines 33 – 37.
 House v The King (1936) 55 CLR 499, at 504.
 Lovell v Lovell (1950) 81 CLR 513.
- Published Case Name:
McGrath Property Management Bulimba v Christoe & Van Der Woude
- Shortened Case Name:
McGrath Property Management Bulimba v Christoe & Van Der Woude
 QCATA 159
Senior Member Stilgoe OAM
05 Nov 2015