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Property Indulgence v Allen QCATA 66
QUEENSLAND CIVIL AND ADMINISTRATIVE TRIBUNAL
Property Indulgence v Allen  QCATA 66
ORIGINATING APPLICATION NO/S:
27 April 2020
On the papers
LANDLORD AND TENANT – RESIDENTIAL TENANCIES LEGISLATION – OBLIGATIONS, PROHIBITED MATTERS AND PROTECTION FOR LESSEES – RENT – where tenants claimed compensation for flood event arising from burst pipe – where tenants did not claim within six months of becoming aware of breach – where claim out of time – where alternative claim under rent reduction regime did not apply – where lessor claimed compensation – where tenants entitled to bond, subject to any proven claim for compensation – where lessor required to file separate application or counter-application – where lessor did not – where findings of fact about condition of property at end of tenancy and damages awarded based on evidence adduced at hearing – where Tribunal has mandate to deal with matters fairly, quickly and economically – where party cannot seek to ‘shore up’ claims after the event
APPEAL AND NEW TRIAL – APPEAL – GENERAL PRINCIPLES – ADMISSION OF FURTHER EVIDENCE – IN GENERAL – where applicant applied for leave to appeal – where applicant sought to introduce evidence not adduced at first instance – where applicant did not explain why it did not file its material before original hearing – where Tribunal must observe natural justice – where parties must be allowed to test evidence and present evidence in response – where tenant not given this opportunity – where Tribunal’s mandate to deal with matters fairly, quickly and economically is most acute in its minor civil disputes jurisdiction – where evidence should not be admitted – where Tribunal will not usually disturb findings of fact on appeal – where findings open on the evidence – where ground of appeal dismissed
APPEAL AND NEW TRIAL – APPEAL – GENERAL PRINCIPLES – WHEN APPEAL LIES – ERROR OF LAW – PARTICULAR CASES INVOLVING ERROR OF LAW – other cases – where applicant applied for leave to appeal – where error of law in application of time limit – where Tribunal may set aside decision and substitute its own decision
Queensland Civil and Administrative Tribunal Act 2009 (Qld), s 3, s 4, s 28, s 143, s 146
Residential Tenancies and Rooming Accommodation Act 2008 (Qld), s 94, s 417, s 419
Bradlyn Nominees Pty Ltd v Saikovski  QCATA 39
Cachia v Grech  NSWCA 232
Chambers v Jobling (1986) 7 NSWLR 1
Campbell v Donker  QCATA 6
Clarke v Japan Machines (Australia) Pty Ltd  1 Qd R 404
Dearman v Dearman (1908) 7 CLR 549
Fox v Percy (2003) 214 CLR 118
Gould v Mazheiko & Anor  QCATA 10
Glenwood Properties Pty Ltd v Delmoss Pty Ltd  2 Qd R 388
Masinello v Parker & Anor (No 2)  QCATA 325
McIver Bulk Liquid Haulage Pty Ltd v Fruehauf Australia Pty Ltd  2 Qd R 577
Minister for Immigration and Citizenship v SZMDS & Anor (2010) 240 CLR 611
Piric & Anor v Claudia Tillier Holdings Pty Ltd  QCATA 152
QUYD Pty Ltd v Marvass Pty Ltd  1 Qd R 41
Slater v Wilkes  QCATA 12
Underwood v Queensland Department of Communities (State of Queensland)  QCA 158
This matter was heard and determined on the papers pursuant to s 32 of the Queensland Civil and Administrative Tribunal Act 2009 (Qld).
REASONS FOR DECISION
What is this appeal about?
- Two Justices of the Peace ordered Property Indulgence pay their former tenants, Michael Allen and Dorothy Allen the sum of $2,020.50 as follows:
- (a)$700.00 – compensation for loss of use (2 weeks’ rent at $350.00 per week);
- (b)$1200.00 – part bond refund; and
- (c)$120.50 – filing fee.
- Property Indulgence wants to appeal that decision.
- Because this is an appeal from a minor civil dispute, leave is required.
- In determining whether to grant leave, the Tribunal will consider established principles including:
- (a)whether there is a reasonably arguable case of error in the primary decision;
- (b)whether there is a reasonable prospect that the appellant will obtain substantive relief;
- (c)whether leave is needed to correct a substantial injustice caused by some error; and
- (d)whether there is a question of general importance upon which further argument, and a decision of the Appeal Tribunal, would be to the public advantage.
- I will address the grounds of appeal below.
Can Property Indulgence rely upon new evidence to support its appeal?
- Property Indulgence attached to its application for leave to appeal documents including invoices, condition reports, correspondence and photographs. Many, if not most, were not provided at the original hearing.
- To the extent that the documents are fresh evidence, they are not admitted.
- The Appeal Tribunal will only accept fresh evidence if it was not reasonably available at the time the proceeding was heard and determined. Ordinarily, an applicant for leave to adduce fresh evidence must satisfy three tests:
- (a)Could the parties have obtained the evidence with reasonable diligence for use at the trial?
- (b)If allowed, would the evidence probably have an important impact on the result of the case?
- (c)Is the evidence credible?
- Property Indulgence did not explain why it did not file its material before the original hearing. If Property Indulgence believed it was entitled to compensation, it should have filed its claim and supporting material before the original hearing. This did not escape the learned Justices, who had cause to admonish Property Indulgence for this very reason:
TRIBUNAL JP 1: Well, for a start tell us how you rook [sic] the $1400 and on what basis and what justification. And the second thing, tell us if you’re going to give us a list of stuff that you did take for the bond – why you didn’t put a response in on this claim.
MS BRADLEY: A response on - - -
TRIBUNAL JP 1: Yes, a response to this claim. Why didn’t you put a response in? Because I’m sure you’re going to come up with $1400 worth of expenses because you’ve taken the bond. Surely, you would have put that in beforehand so that we would have looked at and said, “Yes, that looks reasonable”, but instead you’re going to table it now, aren’t you?
MS BRADLEY: Well, I didn’t realise that I had to do a counterclaim for it.
TRIBUNAL JP 1: Right. And our point, having discussed it and reviewed the file, is that you should have put a response in. And you know that because you’re a property manager and you’re a specialist. All right. So you’re going to tell us that you have $1400 – I assume, $1400, probably more, that you want to be offset against this claim that is being made here today. Is that right?
MS BRADLEY: What do we need in total? Was – we only claimed the 1400.
TRIBUNAL JP 1: So you don’t have any other claims other than $1400.
MS BRADLEY: That’s correct.
TRIBUNAL JP 1: Okay.
MS BRADLEY: We claimed the bond, as Michael has said, yes, as a – it’s a step that we take when we do a vacate that doesn’t look like it’s up to scratch.
TRIBUNAL JP 2: Yes okay.
TRIBUNAL JP 1: Well, I would suggest that that might be something you might have a serious think about, because you’re claiming an expectation of expenses which may not occur. Right. You are saying “I’ll take the lot and then we’ll worry about filling in the detail later.” I’m sorry, but that’s – not only is it unacceptable, it’s illegal. You must claim the bond for expenses you’ve incurred. Now, if you lodge that bond claim on the afternoon, as Mr Allen has said, then you incurred no expenses at that time against that bond.
TRIBUNAL JP 2: We have the photos here. You haven’t tabled an invoice with any of this.
MS BRADLEY: Yes, we do have invoices that go with it. There’s a cleaning invoice, a yard maintenance invoice, the rubbish removal invoice and the flea and tick invoice.
TRIBUNAL JP 1: So you’ve got three copies?
MS BRADLEY: Unfortunately, no, I don’t. You can have these if you wish.
TRIBUNAL JP 2: Have you seen these before, Mr Allen?
MR ALLEN: No, your Honour.
TRIBUNAL JP 2: You haven’t received any information to that effect - - -
MR ALLEN: No.
TRIBUNAL JP 2: - - - justifying the $1400?
MR ALLEN: No.
TRIBUNAL JP 1: Have a look at each of them.
TRIBUNAL JP 2: Have a look at each of them for us.
TRIBUNAL JP 1: Ms Bradley, are you the dealer principal for the Property Indulgence?
MS BRADLEY: No, I am not.
TRIBUNAL JP 1: Right. Okay. You might want to have a discussion with your dealer principal when you get back about the issues that are going to be raised here today, because that it unsatisfactory: totally unsatisfactory. You cannot do what you have just done. And I’m about to consider – to adjourn the matter so we can consider what you have done and what we will do about it. Right. You are treating this tribunal very lightly: very lightly. You are not giving this person over here a fair go with what you’re claiming.
- Tenants are entitled to their bond, subject only to any proven claim for compensation by the lessor. The lessor is required to file a separate application or counter-application for compensation. The Tribunal then makes findings and any amounts awarded to the lessor are deducted from the bond, if still held with the Residential Tenancies Authority. If the bond has already been paid, then the parties must adjust their positions accordingly.
- Property Indulgence did not file a separate application or counter-application for compensation. Notwithstanding this, the learned Justices commendably afforded it latitude and treated its belated claims as a counter-application, consistent with the Tribunal’s mandate to deal with matters fairly, quickly and economically. However, the learned Justices’ exercising of their discretion does not mean that Property Indulgence can now seek to ‘shore up’ its claims after the event.
- Although the Tribunal is not bound by the rules of evidence and may inform itself in any way it considers appropriate, the Tribunal must observe natural justice. Parties must be allowed to test the evidence and present evidence in response. The tenants were not given the opportunity to test any of the fresh evidence that Property Indulgence should have filed by the time of the original hearing. An application for leave to appeal is not, and should not be an attempt to reargue a party’s case at the initial hearing.
- The appeal process is not an opportunity for a party to again present their case. It is the means to correct an error by the Tribunal that decided the proceeding. The Tribunal’s mandate to deal with matters fairly, quickly and economically is most acute in its minor civil disputes jurisdiction, where it determines around 30,000 applications each year.
- The fresh evidence should not be admitted and the application for leave to appeal must proceed on the basis of the evidence before the Tribunal.
Was the evidence capable of supporting the Tribunal’s findings?
- Property Indulgence’s submissions then sought to reargue their claims for compensation and disputed the learned Justices’ findings about its claim of $1,373.25 for various expenses and who was responsible. Instead, the learned Justices awarded $200.00. These are findings of fact.
- The Appeal Tribunal will not usually disturb findings of fact on appeal if the evidence is capable of supporting the conclusions. An appellate tribunal may only interfere if the conclusion is ‘contrary to compelling inferences’ in the case. A decision cannot properly be called erroneous, simply because the learned Justices preferred one conclusion to another possible conclusion.
- Although the learned Justices did not expressly refer to all the evidence when delivering their findings, it is implicit that they preferred Mr Allen’s evidence over Ms Bradley’s essentially uncorroborated evidence when making their findings. Having heard the evidence of both Mr Allen and Ms Bradley, the learned Justices were in the best position to assess credibility. It is not an error to prefer one version of facts to another.
- The learned Justices made findings about the condition of the property at the end of the tenancy and awarded damages based on the oral evidence of the parties, as supported by documentary evidence adduced at the hearing.
- Nothing in the material or the transcript persuades the Appeal Tribunal that the findings were not open to the learned Justices. Their findings about cleaning up and rubbish removal were open on the evidence. An appeal is not an opportunity for a party to simply re-argue its case on existing or additional evidence, or to simply conduct a retrial on the merits of the case.
- Having read the transcript and considered the evidence, nothing persuades me to depart from the learned Justices’ findings. The evidence was capable of supporting the Tribunal’s conclusions.
- This ground of appeal is dismissed.
Was the Tribunal able to award $700.00 as compensation for loss of use or as a rent reduction?
- Property Indulgence submitted that the Tribunal erred in awarding two weeks’ rent of $700.00 to compensate for a flooding event from burst pipes in 2016. The Appeal Tribunal accepts Property Indulgence’s submission because Mr and Ms Allen did not make their claim within six months of the Tenants becoming aware of the breach.
- The learned Justices’ finding reads:
With regards to the two weeks rent claimed, we find in favour of the applicant with regards to the two weeks rent claim. We believe that notice was given at the time that there was a major leak and actually a reduction was sought at the time after actually having to vacate the property.
- The time limit applies to the application and runs from when the tenant became aware of the breach. Mr and Mrs Allen became aware that the pipes burst in September 2016. Mr and Mrs Allen did not file their application until 8 March 2019, nor a Dispute Resolution Request with the Residential Tenancies Authority until shortly before then. Accordingly, their claim is well out of time. This means the learned Justices were in error in awarding Mr and Ms Allen compensation.
- For completeness, the Appeal Tribunal also finds that Mr and Ms Allen would not have been entitled to a rent decrease from loss of amenity under section 94 of the Act. The time limit under section 419 does not apply to claims brought under section 94. However, for section 94 to apply, the Tribunal must be satisfied that the premises were completely or partly unfit to live in such that this does not result in a breach of the Agreement, or the amenity of the premises decreases substantially other than because of malicious damage by the tenant.
- This requires a finding of fact that the issues with the burst pipes resulted in the premises being at least partly unfit to live in or the amenity or standard of the premises decreased substantially. The learned Justices made no such finding. In the absence of any such finding, the Tribunal was unable to award a rent reduction under section 94.
- Moreover, the President sitting as the Appeal Tribunal has recently upheld the line of authority that section 94 does not provide for compensation by way of a lump sum and that applications under section 94 must be made during the tenancy. In other words, section 94 only operates prospectively to allow a tenant to apply for a reduction in their rent while the tenancy continues or until the lessor restores the loss of amenity.
- The Appeal Tribunal is therefore not satisfied that section 94 permits a ‘retrospective’ rent reduction, nor would it be just in circumstances where the tenant did not apply for a reduction until years after first becoming aware of issues with the pipes and many months after vacating the property.
- Awarding $700.00 as compensation for a breach of the agreement or as a rent reduction for loss of amenity in these circumstances is an error of law and leave to appeal must be granted on this ground. Because this is an error of law, the Tribunal may set aside the decision and substitute its own decision.
- Having considered the evidence as set out above, the Appeal Tribunal is not satisfied that Mr and Ms Allen are entitled to any compensation or rent reduction.
What are the appropriate Orders?
- Because the Tribunal erred in awarding Mr and Ms Allen $700.00 as compensation or as a rent reduction, leave to appeal is granted and the appeal is allowed. This means that Mr and Ms Allen’s claim for $700.00 is dismissed.
- Property Indulgence’s other ground of appeal is dismissed and its remaining claims are dismissed, meaning it has succeeded in its original claim only to the extent of $200.00 – as found by the learned Justices.
- The Appeal Tribunal also finds no reason to depart from the learned Justices’ awarding of costs of $120.50, given that Mr and Ms Allen were mostly successful in their application.
- The bond held by the Residential Tenancies Authority was $1,400.00.
- Accordingly, the appropriate Orders are:
- Leave to appeal granted.
- The appeal is allowed.
- The Tribunal’s decision of 13 June 2019 is set aside.
- The Tribunal substitutes its own decision as follows:
- (a)The Residential Tenancies Authority pay the bond of $1,400.00 as follows:
- (i)To the Lessor – $279.50.
- (ii)To the Tenants – $1120.50.
- (b)The application is otherwise dismissed.
- (c)The counter-application is otherwise dismissed.
- The Appeal Tribunal notes that in reality, the Residential Tenancies Authority has already paid out the bond of $1,400.00. The parties will therefore need to adjust their respective positions in accordance with these reasons.
 Queensland Civil and Administrative Tribunal Act 2009 (Qld), s 143(3).
 QUYD Pty Ltd v Marvass Pty Ltd  1 Qd R 41.
 Cachia v Grech  NSWCA 232, 2.
 QUYD Pty Ltd v Marvass Pty Ltd  1 Qd R 41.
 Glenwood Properties Pty Ltd v Delmoss Pty Ltd  2 Qd R 388, 389; McIver Bulk Liquid Haulage Pty Ltd v Fruehauf Australia Pty Ltd  2 Qd R 577, 577, 580.
 Clarke v Japan Machines (Australia) Pty Ltd  1 Qd R 404, 408.
 Transcript, page 1-8, lines 24-36; page 1-9, lines 6-46; page 1-10, lines 1-23.
 Queensland Civil and Administrative Tribunal Act 2009 (Qld), s 3, s 4 (‘QCAT Act’).
 Ibid, s 28(3)(b).
 Ibid, s 28(3)(a).
 Bradlyn Nominees Pty Ltd v Saikovski  QCATA 39, .
 QCAT Act, s 3, s 4.
 Dearman v Dearman (1908) 7 CLR 549, 561; Fox v Percy (2003) 214 CLR 118, 125-126.
 Chambers v Jobling (1986) 7 NSWLR 1, 10.
 Slater v Wilkes  QCATA 12, , citing Minister for Immigration and Citizenship v SZMDS & Anor (2010) 240 CLR 611.
 Slater v Wilkes  QCATA 12, .
 Transcript, page 1-20, lines 31-38.
 Piric & Anor v Claudia Tillier Holdings Pty Ltd  QCATA 152,  (Wilson J).
 Residential Tenancies and Rooming Accommodation Act 2008 (Qld), s 419(3).
 Transcript dated 13 June 2019, page 1-20, lines 25-28.
 Residential Tenancies and Rooming Accommodation Act 2008 (Qld), s 419(2) and (3).
 Ibid, s 419(3).
 Ibid, s 417(2) provides that a reference to making an application includes a dispute resolution request to the authority.
 Gould v Mazheiko & Anor  QCATA 10,  (Daubney J).
 Residential Tenancies and Rooming Accommodation Act 2008 (Qld), s 94(1)(a).
 Ibid, s 94(2)(b).
 Campbell v Donker  QCATA 6, .
 Gould v Mazheiko & Anor  QCATA 10,  (Daubney J).
 Underwood v Queensland Department of Communities (State of Queensland)  QCA 158, , .
 Ibid, ; Masinello v Parker & Anor (No 2)  QCATA 325, .
 Queensland Civil and Administrative Tribunal Act 2009 (Qld), s 146.
- Published Case Name:
Property Indulgence v Michael Allen and Dorothy Allen
- Shortened Case Name:
Property Indulgence v Allen
 QCATA 66
27 Apr 2020