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Norris v Elders Real Estate QCATA 182
Norris & Anor v Elders Real Estate  QCATA 182
Elders Real Estate
On the papers
22 November 2016
IT IS THE DECISION OF THE APPEAL TRIBUNAL THAT:
LANDLORD AND TENANT – RESIDENTIAL TENANCIES LEGISLATION – OBLIGATIONS, PROHIBITED MATTERS AND PROTECTION FOR LESSEES – where the tenants sought a return of their rental bond upon termination of their lease – where the landlord counterclaimed – whether the landlord took all reasonable steps to mitigate expense – where the parties did not raise the issue of a rent – free agreement at the tribunal hearing
APPEAL AND NEW TRIAL – APPEAL – GENERAL PRINCIPLES – INTERFERENCE WITH JUDGE’S FINDINGS OF FACT – FUNCTIONS OF APPELLATE COURT – IN GENERAL – where the tribunal found the landlord had not acted unreasonably or not mitigated its loss – whether any basis to interfere with the tribunal’s finding of fact – whether leave to appeal should be granted
Residential Tenancies and Rooming Accommodation Act 2008 (Qld) s 362
Chambers v Jobling (1986) 7 NSWLR 1
Dearman v Dearman (1908) 7 CLR 549
Fox v Percy (2003) 214 CLR 118
APPEARANCES and REPRESENTATION:
This matter was heard and determined on the papers without the attendance of either party in accordance with s 32 of the Queensland Civil and Administrative Tribunal Act 2009 (Qld) (QCAT Act).
REASONS FOR DECISION
- The applicants (tenants) seek leave to appeal a tribunal decision in the minor civil dispute jurisdiction to award the full bond ($1280) to the respondents (agents) for costs incurred by the landlord after the tenants vacated the property.
- The tenants signed a general tenancy agreement for a 12 month fixed-term lease on 9 January 2015.
- On 30 October, the agent wrote to the tenants confirming the landlord’s offer to release them from the remainder of the lease without penalty and pay compensation of two weeks rent free if they vacated by 13 November 2015. The tenants claim the landlords accepted their counter-offer to leave on 16 November 2015 on the same terms as to compensation.
- The tenants actually vacated on 16 November. A final inspection found exit condition items not noted on the entry report, which the agent says is the tenants’ responsibility under the tenancy agreement. The tenants were informed by email on 18 November 2015 that cleaners and a pest controller had been organised to put the premises in order out of the $1280 bond deposit and that because the final inspection was unsatisfactory they would not be receiving any of the bond back. They were also told that they had lost their entitlement to compensation for early leaving due to the state of the property.
The leave grounds
- The tenants seek leave to argue that the tribunal made errors of fact in:
- ruling that the agents mitigated their loss under s 362(3) of the Residential Tenancies and Rooming Accommodation Act 2008 (Qld) (RTRA Act) (ground 1);
- considering the email of 18 November 2015 as evidence that the rent-free offer was retracted when the original agreement was not contingent on the final inspection (ground 2); and
- awarding costs for yard maintenance carried out six days after the owner moved back in (ground 3).
Grounds 1 and 3
- Section 362 RTRA Act relevantly provides:
- This section applies to the lessor if the lessor incurs loss or expense because of—
- the tenant's failure to hand over vacant possession of the premises after a termination order is made by a tribunal; or
- the tenant's abandonment of the premises; or
- another act or omission of the tenant.
- The lessor or tenant—
- must take all reasonable steps to mitigate the loss or expense; and
- is not entitled to receive compensation for any loss or expense that could have been avoided by taking the steps.
- The tenants contend that the tribunal should not have found that the agents’ duty to mitigate expenses was ‘negated’ in circumstances where they were denied the chance of rectifying the exit condition issues themselves more cheaply than external contractors because the owners needed to move in on 18 November 2015 and could not afford to store their property elsewhere while the property was brought up to standard.
- The loss incurred by the landlords for the tenants’ failure to hand over the property in the same condition as they found it was $1509.10; that is, $229.10 on top of the $1280 security bond. The tribunal ordered instead that the rental bond be forfeited in full and final satisfaction and made no other order (e.g. for costs).
- The tribunal’s reasons are scant, but imply a finding that the loss was actually and reasonably incurred and that the duty to mitigate did not extend to giving the tenants another chance to hand over the premises in satisfactory condition.
- Whether the landlord took all reasonable steps to mitigate expense is a question of fact. The appeal tribunal will not disturb evidence-based findings of fact unless they are plainly wrong or contrary to compelling opposite inferences. The reasonableness of the loss incurred, for example, is a matter of degree about which minds can differ without any being demonstrably right or definitely wrong.
- A difference on a contestable matter of opinion is not a basis for appellate interference. There is no vitiating error of fact in making an adverse finding of fact open on the evidence.
- Unsurprisingly, the tribunal did not even address the rent-free agreement, because it was neither claimed nor raised as a set-off nor mentioned by either side in the hearing. The tribunal identified the ‘basis for (the tenants’) claim for the return of the $1280 rental bond is that they could not understand why it hadn’t been given back to them and that the property had been left in a ‘clean, neat and tidy state’.
- The tenants may have a valid claim to the rent-free amount if it was wrongly withheld as a double penalty for the unsatisfactory exit condition, but will have to reinstitute a claim. Their entitlement to rent-free compensation depends on the terms of the agreement and whether they were met; not on the exit condition report. The general terms of the tenancy and any collateral agreement about compensation are distinct issues.
- Leave to appeal is refused.
- Published Case Name:
Norris & Anor v Elders Real Estate
- Shortened Case Name:
Norris v Elders Real Estate
 QCATA 182
22 Nov 2016