Stuart Ross Realty Pty Ltd v Horsey
[2018] QCATA 97
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- Unreported Judgment
- Stuart Ross Realty Pty Ltd v Horsey[2018] QCATA 97
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Stuart Ross Realty Pty Ltd v Horsey[2018] QCATA 97
Stuart Ross Realty Pty Ltd v Horsey[2018] QCATA 97
QUEENSLAND CIVIL AND ADMINISTRATIVE TRIBUNAL
CITATION: | Stuart Ross Realty Pty Ltd v Horsey & Anor [2018] QCATA 97 |
PARTIES: | STUART ROSS REALTY PTY LTD (applicant/appellant) |
v | |
TRACEY LEIGH HORSEY (first respondent) PHILLIP MEPSTEAD (second respondent) | |
APPLICATION NO/S: | APL335-17 |
ORIGINATING APPLICATION NO/S: | MCDT454-17 (Ipswich) |
MATTER TYPE: | Appeals |
DELIVERED ON: | 10 July 2018 |
HEARING DATE: | 29 May 2018 |
HEARD AT: | Brisbane |
DECISION OF: | Member Howe |
ORDERS: |
|
CATCHWORDS: | APPEAL AND NEW TRIAL – APPEAL – GENERAL PRINCIPLES – RIGHT OF APPEAL – WHEN APPEAL LIES – ERROR OF LAW – PARTICULAR CASES INVOLVING ERROR OF LAW – where the lessor claimed the bond from the RTA after the tenants vacated – where the tenants claimed the lessor agreed to allow the first 4 weeks of occupation rent free – whether that claim was out of time – where the lessor claimed the bond from the RTA for the costs of cleaning and repairs – where the bond was paid out to the lessor – where the lessor applied to the Tribunal to recover arrears of rent and additional different items of compensation from the tenants – where the claim for additional items of compensation was abandoned at hearing because the house had burnt down shortly after the tenants vacated – where there was no counter application by the tenants claiming the items of compensation covered by the bond already paid out to the lessor – whether the Justices of the Peace could adjudicate on those items of compensation in those circumstances Queensland Civil and Administrative Tribunal Act 2009 (Qld), s 3(b), s 12, s 142(3)(a)(i) Residential Tenancies and Rooming Accommodation Act 2008 (Qld), s 111, s 419(2), s 419(4)(c), s 429 Lyons v Building Services Authority & Anor [2011] QCATA 240 Pickering v McArthur [2005] QCA 294 |
APPEARANCES & REPRESENTATION: | |
Applicant: | Self-represented, by S Perkins and S Ross |
First Respondent: | Self-represented |
Second respondent: | No appearance |
REASONS FOR DECISION
- [1]The respondents (‘the tenants’) rented a residential property at Merryvale through the appellants who acted as agents for the lessor. The fixed term of the tenancy ended in May 2017. The rent was $460 per week.
- [2]The tenants vacated in April 2017.
- [3]The appellants (‘the agents’) claimed the bond of $1,840 from the Residential Tenancies Authority (‘RTA’) and it was paid out to them because the tenants did not oppose the payment. The agents used most of the bond to pay for bond cleaning and a small part was put towards rent.
- [4]The agents sued in the Tribunal for other things not covered by the bond, namely arrears of rent of $2,804.65, glass repairs of $270 and carpet cleaning and pest control of $240.
- [5]The rental house burnt down within a week after the tenants vacated. Though added to the application the agents did not pursue the claim for glass repairs, carpet cleaning or pest control at hearing. They wanted only the arrears of rent.
- [6]At the hearing before Justices of the Peace the tenants raised an issue about a promise by the agents to allow the first 4 weeks of occupation rent free to compensate for the tenants having to clean the house when first taking up occupation. The Justices of the Peace considered the tenants claim about that, and that the bond had been paid out by the RTA to the agents to cover costs of cleaning at vacate and ordered the agents to pay the first respondent (only) the sum of $875.35 on the basis of the balance monies owing between the parties was money to the tenants.
- [7]There was no counter application in respect of the 4 weeks rent free claim filed by the tenants.
- [8]The agents want to appeal the decision.
- [9]Given this is an appeal from a decision made in the Tribunal’s Minor Civil Dispute jurisdiction, leave to appeal must first be obtained before any appeal proceeds.[1]
- [10]Leave to appeal will usually only be granted where an appeal is necessary to correct a substantial injustice to the appellant and where there is a reasonable argument that there is an error to be corrected.[2]
The Grounds of Appeal
- [11]The agents say they filed an application to recover money from the tenants but at the hearing they were ordered to pay the first respondent money instead.
- [12]They say the only application before the Tribunal for determination was their application claiming arrears of rent and compensation for glass damage and for carpet cleaning and pest treatment.
- [13]The tenants had not opposed the payout by the RTA before the hearing.
The Claim for 4 Weeks’ Rent Concession
- [14]By s 419(2) of the Residential Tenancies and Rooming Accommodation Act 2008 (Qld) (‘the Act’), if either party claims there has been a breach of the terms of a residential tenancy agreement either party may apply to the Tribunal for an order about the breach. By s 419(3) the application must be made within 6 months of the party becoming aware of the breach. The application may be made whether or not there is a rental bond held by the RTA.
- [15]The Tribunal accepted that the tenants owed $2,804.65 arrears of rent when they vacated. From that however the Tribunal subtracted the equivalent of 4 weeks rent representing the amount they found the lessor had agreed to allow the tenants at entry if they cleaned the property.
- [16]But the tenants went into the property on or about 6 May 2016. They vacated in April 2017. The tenant’s evidence (only the first respondent appeared before the Justices of the Peace) was that she pursued the lessor for the credit but it was not forthcoming. She regarded that as a broken promise about the rent the tenants had to pay under the tenancy agreement.
- [17]By s 419(3) the tenants had 6 months after becoming aware of that broken promise to make application to the Tribunal about what the tenants considered was a breach of the tenancy agreement. The tenants did not do that. By the time of the hearing it was 12 months after the credit should have been given and they had not made any application about it to the Tribunal. Accordingly any claim they had to those monies appears to have been well out of time under the Act and not available for consideration by the Tribunal at the hearing.
No Counter Application
- [18]It is quite common in tenancy compensation claims before the Tribunal for, say, a tenant to apply to recover the tenant’s bond, and at hearing the lessor oppose the release of all or part of the bond and claim the bond for himself or herself. A bond is paid to be available for the financial protection of the lessor against the tenant breaching the tenancy agreement.[3]
- [19]In such cases, if the claim by the lessor is for all or part of the bond held by the RTA, the Tribunal considers the parties respective claims and makes an order distributing the bond as deemed appropriate.
- [20]If the claim by the lessor against the tenant exceeds the amount of the bond held by the RTA, the Tribunal requires the lessor to file a counter application and may order both that the bond and the additional money claimed be paid out to the lessor or order a payment in whatever balance is appropriate. Similar rules about filing counter applications apply to tenants.
- [21]Here, the bond had already been paid out to the lessor’s agent. That is done where the tenants do not advise the RTA that that proposed payment should not be made.
- [22]Despite that payment out, it was open to the tenants to file a counterclaim in the within proceedings, subject to the time constraints imposed by s 419(3) of the Act, asking that the lessor’s claim to the bond paid out by the RTA be determined on its merits by the Tribunal. But that was not done here.
- [23]Despite no counter application, the Justices of the Peace proceeded to deal with that matter as an issue to be determined in the proceedings however. That was a mistake.
- [24]The only claim before the Tribunal was the agents claim for arrears of rent.
- [25]The Tribunal’s task is an exceedingly difficult one in minor civil dispute matters. By s 3(b) of the QCAT Act the Tribunal is required to deal with matters in a way that is accessible, fair, just, informal and quick and s 4(c) provides that to achieve that the Tribunal should ensure proceedings are conducted in an informal way that minimises costs to parties and is as quick as is consistent with achieving justice.
- [26]But despite those objects, the Tribunal must apply the law in attaining them. By s 12 of the QCAT Act the Tribunal may exercise its jurisdiction in minor civil disputes about residential tenancy matters if a tenant or lessor or other person under the Act applies to the Tribunal about a tenancy matter.
- [27]By s 419(2) of the Act the lessor or a tenant may apply to the Tribunal about a breach of a term of a residential tenancy agreement. So in the matter at hand where a tenant’s bond is paid out to a lessor based on the lessor’s claim that the property at vacate is not in the same condition at exit as it was handed over on entry, the tenant may apply to the Tribunal.
- [28]Where a bond is held by the RTA and the parties dispute to whom it should be paid, and the RTA is informed that there is a dispute about the bond, it will not be paid out until either party applies to the Tribunal for an order determining who is entitled to the bond.[4]
- [29]But without an application to the Tribunal about such an issue, the Tribunal has no jurisdiction to entertain a dispute simply because it is raised at a hearing as a related factual adjunct to proceedings commenced by application filed by a lessor or tenant seeking resolution of a different discrete issue.
- [30]Where the matter concerns a compensation claim, the provisions of s 419 apply and any issue in dispute about the bond must have gone to conciliation before the RTA before an application to the Tribunal is filed.
- [31]Here there was a copy of the lessor’s application for RTA conciliation filed with the lessor’s initiating Tribunal application and the issue identified for conciliation is ‘cleaning after vacate’ which appears to cover the cleaning matters so s 419 does not appear to have been breached.
- [32]However, there is another significant problem associated with the determination of a matter at hearing without prior notice being given through a counter application being filed and served. It will generally be a denial of procedural fairness if notice of the issues for determination at a hearing is not given all parties, and that will constitute an error of law:
It is a fundamental requirement of procedural fairness that any person entitled to be heard in a matter be given appropriate notice of the case he is to meet. Appropriate prior notice allows a party to prepare and present his case effectively. Inadequate notice both in respect of either time or substance prevents a party from being able to do so, and amounts to a denial of procedural fairness.[5]
- [33]The agents were criticised at the hearing because they came to the hearing without an entry condition report and the lessor’s entitlement to the bond money was rejected because of that lack of evidence.[6] But they did not understand there was an issue about the compensation matters. They abandoned their claim to compensation items (because the house burnt down) and the only issue extant at hearing was arrears of rent, which the Justices of the Peace found were owing.
- [34]The Justices of the Peace should not have considered the issues about cleaning and repairs claimed from the bond without a counter application concerning that matter filed by the tenants.
- [35]The Justices of the Peace fell into an error of law.
Conclusion
- [36]It is appropriate to grant leave to appeal in the circumstances to correct a substantial injustice to the appellant.
- [37]For the reasons set out above, the appeal is allowed on the basis of error of law. The decision made by the Justices of the Peace is set aside and in lieu thereof there should be an order that the respondents pay the arrears of rent otherwise found owing by the Justices of the Peace of $2,804.65.
- [38]If the applicant has paid the sum of $875.35 to the first respondent Ms Horsey pursuant to the order of the Justices of the Peace, she must additionally repay that money to the applicant agents. It is not clear however whether that payment has been made. No application to stay the decision of the Justices of the Peace was filed.
Footnotes
[1]Queensland Civil and Administrative Tribunal Act 2009 (Qld) (‘QCAT Act’), s 142(3)(a)(i).
[2]Pickering v McArthur [2005] QCA 294, [3].
[3]Residential Tenancies and Rooming Accommodation Act 2008 (Qld), s 111.
[4] Ibid s 429.
[5]Lyons v Building Services Authority & Anor [2011] QCATA 240, [13].
[6] Transcript Page 1-35, Line 14.