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Lobato v Gardian Real Estate Pty Ltd[2021] QCATA 130

Lobato v Gardian Real Estate Pty Ltd[2021] QCATA 130

QUEENSLAND CIVIL AND ADMINISTRATIVE TRIBUNAL

CITATION:

Lobato v Gardian Real Estate Pty Ltd [2021] QCATA 130

PARTIES:

alan max lobato and barbera joy ball

(applicants/appellants)

v

gardian real estate pty ltd

(respondent)

APPLICATION NO/S:

APL287-19

ORIGINATING

APPLICATION NO/S:

MCDT200-19

MATTER TYPE:

Appeals

DELIVERED ON:

3 November 2021

HEARING DATE:

On the papers

HEARD AT:

Brisbane

DECISION OF:

Judicial Member D J McGill SC

ORDERS:

  1. Leave to appeal from the decision of the Tribunal of 9 October 2019 refused. 
  2. Application for miscellaneous matters filed 6 November 2019 dismissed.
  3. No order as to costs. 

CATCHWORDS:

LANDLORD AND TENANT – RESIDENTIAL TENANCIES LEGISLATION – OTHER MATTERS – tenancy for a term – termination of tenancy – excessive hardship – need for timely application to Tribunal – Notice of intention to leave ineffectual.

Residential Tenancy and Rooming Accommodation Act 2009 (Qld) s 277, s 310, s 343

Hiscox v PBG Realty [2019] QCATA 112

Leddicoat v Walker [2010] QCATA 18

APPEARANCES &

REPRESENTATION:

Applicants:

Self-represented

Respondent:

Self-represented

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

  1. [1]
    The appellants were formerly tenants of a residential property at Slade Point, managed for the owner by the respondent agent.  It is convenient to refer to the appellants as the tenants and the respondent as the agent.  On 14 June 2019 the tenants filed in the Tribunal an Application for a minor civil dispute – residential tenancy dispute, which appear to have been seeking orders for the termination of the tenancy under the Residential Tenancy and Rooming Accommodation Act 2009 (Qld) (“the Act”) s 227,[1] and for the disposition of the rental bond held by the Residential Tenancy Authority (RTA) in respect of their tenancy agreement.[2]  On 28 June 2019 the dispute was referred to mediation, but was not resolved.[3] 
  2. [2]
    On 10 July 2019 the agent filed a Counter-application in the name of (I assume) the owners of the property seeking an amount for unpaid rent, including rent after the tenants had vacated, a break lease fee, certain amounts for repairs to paintwork and replacement of a changed shower head and payment of a water invoice, the claims totalling $10,137.37. 
  3. [3]
    The proceeding originally came on for hearing before a Member on 19 September 2019 when the parties appeared and the tenants were given leave to file and serve an amended application, and the hearing was adjourned to 4 October 2019.  The tenants then filed an amended application dated 26 September 2019 seeking termination of the tenancy under the Act s 295[4] and s 310, on the basis that the male tenant was unable to work due to a medical condition, and the return of the rental bond.  On 4 October 2019 the tenants did not appear.  The proceeding was adjourned to 9 October 2019, with the tenants to be warned by email that judgment may be given against them if they did not then appear. 
  4. [4]
    On 9 October 2019 the tenants and the agent appeared, and the proceeding was heard and determined by a Member, who ordered the tenants to pay the agent $8,863, and ordered that the RTA pay the rental bond to the agent in part payment of that amount.  On 18 October 2019 the male tenant filed in the Tribunal an Application for leave to appeal against that decision, essentially on the basis that the amount ordered to be paid was too high.  On 6 November 2019 the male tenant filed an application for miscellaneous matters, seeking to have the application for leave to appeal replaced by one seeking to have the decision set aside completely, and relying on different grounds. 
  5. [5]
    On 9 December 2019 a Member directed that the appeal proceeding be amended to record the tenants as the applicants and the agent as the respondent, and that the application for miscellaneous matters be heard and determined on the papers not before 23 January 2020.  That direction was vacated on 6 March 2020, and so far as I can see the application for miscellaneous matters has never been heard and determined, and is before me pursuant to directions made on 6 May 2020.  Those directions also provided that the application filed 6 November 2019 be treated as an application for leave to amend in accordance with the proposed amended application for leave to appeal dated 2 February 2020.  I cannot identify on the file an amended application for leave to appeal of that date, although there is on the file an amended application for leave to appeal dated 20 December 2019, which may have been filed on that date. 
  6. [6]
    The tenants’ applications for leave to appeal and appeal have referred only to the agent as the respondent.  Directions made on 6 March 2020, 14 April 2020 and 6 May 2020 refer to a Mr R Smith, presumably the owner (or one of the owners) of the property concerned, but it does not appear that he has ever been made a party to the application for leave to appeal. 

Hearing at first instance

  1. [7]
    The matter proceeded at first instance as if there had been no application made by the tenants, and the only question was what relief should be granted on the agent’s cross-application.  The tenants explained their circumstances, which were that the male tenant had lost his job, and had been unable to obtain another one, because of ill health.  As a result he was now unable to work in the construction industry, and was now receiving an age pension, so they could no longer afford to rent premises for $700 per week, and had given Notice of intention to leave.  The problem was that they had signed a tenancy agreement for a term, so that they were committed to paying the rent until the expiration of the term.  After they moved out the agent had attempted to relet the premises, but they were not relet until after the term expired. 
  2. [8]
    There was in fact an application for termination for excessive hardship included in the relief sought by the amended application filed by the tenants on 26 September 2019, but given the inappropriate references to s 227 in the original application, and s 295 in the amended application, it is understandable that the Member apparently did not notice that that was the situation.  Hence the Member did not deal with that application at all. 

Leave to appeal

  1. [9]
    As a general proposition, when leave to appeal to the Appeal Tribunal is required, it will be granted only where there is a reasonable argument that the decision was attended by error, and an appeal is necessary to correct a substantial injustice caused by that error, or where the appeal raises a question of general importance upon which further argument and a decision of the Appeal Tribunal would be to the public advantage.[5] In deciding whether grounds for leave to appeal have been shown, it is relevant to consider that the proceeding was a minor civil dispute, and the obligation on the Tribunal is to make orders it considers to be fair and equitable to the parties to the proceeding in order to resolve the dispute: QCAT Act s 13(1).  The Tribunal is also required to comply with the QCAT Act s 28 and s 29. 

Tenants’ submissions

  1. [10]
    In the amended application for leave to appeal the tenants rely on the decision in Noffke v Oceanside Management Pty Ltd [2017] QCA 156, but that decision was not relevant; it was concerned with a situation where an order had been made by the Tribunal terminating a tenancy on the ground of excessive hardship to the tenant, and whether the lessor could then claim payment of a “break-lease fee”. It is not relevant because there was here no order under s 343 terminating the tenancy.  The tenants also complained that the agent had claimed different amounts as the amount owing at different times, and that the agent had failed to relet it over an extended period, even though it was an attractive property in an area where rentals were said to be in short supply. 

Consideration

  1. [11]
    The Act s 310 permits a tenant to apply to the Tribunal for a termination order if the tenant would suffer excessive hardship if the agreement were not terminated.  Such an application may be made without giving a notice of intention to leave to the lessor – the Act s 335(2)(b) – and the Tribunal may make an order if satisfied that the ground has been made out: the Act s 343.  Ordinarily the failure of the Member to consider the tenants’ application under s 310 would be good grounds to allow an appeal, but the difficulty here is that an application under s 310 was not filed until 26 September 2019, by which time the term of the tenancy had expired. 
  2. [12]
    There has been some disagreement within the Tribunal as to whether an order under s 343 can be made to take effect prior to the date of the order.  In Leddicoat v Walker [2010] QCATA 18 A Wilson J, the then President of the Tribunal, refused an application for leave to appeal from a decision of a Member to terminate an agreement under s 343 which took effect from the day after the application had been filed in the Tribunal, and almost a month before the application was heard and decided.[6]  His Honour held at [19] that the finding of excessive hardship was reasonably open to the Member, and that “relief … [was] available to an applicant who established excessive hardship at the time of the application.” 
  3. [13]
    In Kay v Nye [2014] QCATA 42 this decision was said at [6] to be authority that a termination order under s 343 could be backdated to the date of the application, although it was also said at [7] that there was good reason for the order to take effect on the date of the hearing.  On the other hand, in Bateson v Coronis Real Estate [2013] QCATA 328 it was said at [8] that a termination order could only take effect from the date of the hearing, and that approach was followed in Igrowth Investments Pty Ltd v Brown [2018] QCATA 41 at [21]. 
  4. [14]
    Given the consumer protection focus of the Act, and because the decision in Leddicoat (supra) was that of the then President of the Tribunal, I am inclined to prefer the former view.  In this matter however I do not need to decide the point, because on either view a termination order under s 343 could not assist the tenants, given that the term of the tenancy had already expired before the amended application referring to s 310 was filed in the Tribunal.  It follows that the tenants have not lost anything because the Member did not consider the application under s 310.  
  5. [15]
    The Member allowed $8,100 as unpaid rent to the end of the term, together with $550 for the painting repairs and $213 for the water consumption invoice.  The latter two amounts were not disputed by the tenants at the hearing.  At the hearing was rent was said to have been paid to 19 April 2019, and from then until the end of the term on 8 July 2019 was 81 days, which at $100 per day comes to $8,100, the amount allowed by the Member.  The Member did not allow amounts claimed for a new shower head and for the break-lease fees, the latter presumably on the basis that the lease was not in fact broken. 
  6. [16]
    The problem confronting the tenants in this case arises from the fact that they had entered into a tenancy for a term, and they did not take the steps necessary to bring that lease to a premature end.  As a matter of contract, a tenancy for a term binds both parties to continue the tenancy until the end of the term.  In the Act however the legislature has provided certain mechanisms by which a tenancy for a term can be brought to a premature end.  Relevantly, a tenant can apply to the Tribunal seeking an order that the tenancy end on the ground of excessive hardship, under the Act s 310, and if such an application is made, the Tribunal can make that order: the Act s 343.  It is also possible of course for the parties to bring the tenancy to an end by agreement, but assuming that no agreement is achieved, an application to the Tribunal is necessary. 
  7. [17]
    If one were to look only at Clause 36 of the standard terms of the General Tenancy Agreement in Form 18a, and the Act s 277, one might be tempted to believe that a tenancy for a term could be terminated by giving a notice to leave the premises, and handing over vacant possession of the premises to the lessor; but that is not the true position.  The reason for this was explained by the Tribunal in Hiscox v PBG Realty [2019] QCATA 112.  In short, a notice of intention to leave will not take effect prior to the expiration of the term, unless the tenant can establish one of the specific grounds in the Act s 302 – 307.  Just giving a Notice of intention to leave and vacating will not bring to an end the obligation to pay rent.  In the present case it appears the tenants did give a Notice of intention to leave on 20 April 2019, but there was no application filed until 14 June 2019, and no application raising the ground of excessive hardship until 26 September 2019. 
  8. [18]
    A tenant who is suffering excessive hardship therefore needs to apply promptly to the Tribunal to bring the tenancy to an end.  That is an urgent application under the Act s 415(1)(c), so it is not necessary first to send a dispute resolution request to the RTA: s 416(2).  Whether the tenancy can be terminated as from the date when the application is filed in the Tribunal or only as from the date the order is made, speed is of the essence.  It does not help the tenant to wait until after the term has expired to bring the application. 
  9. [19]
    Of course, it takes time for the Tribunal to deal with matters, even urgent applications.  Because of this, it is unfortunate that the legislature did not confer on the Tribunal expressly a power to backdate an order under s 343, to clarify the situation and to encourage lessors to be reasonable about terminating tenancies by agreement in the case of genuine excessive hardship. 
  10. [20]
    One curious feature of the Act is that a tenancy for a term does not come to an end at the end of the term even if the tenant in fact vacates the premises then and hands back the keys to the lessor.  The tenant must have first given a Notice of intention to leave under the Act s 327 at least fourteen days before the end of the term.  That is because the Act s 70 has the effect that the end of the term simply converts the tenancy into a periodic tenancy unless it is properly terminated in accordance with the Act s 277, in practice by giving a proper Notice of intention to leave.  Even what would amount, under the common law, to a surrender of the tenancy will not have that effect, unless there is an agreement in writing: the Act s 277.  In the present case however the lessor has been content to treat the tenancy as at an end from the end of the term. 
  11. [21]
    One may be cynically suspicious about the failure to relet the premises after they were vacated until just after the term had expired, but that is not enough to assist the tenants.  Their position is unfortunate, particularly since the material does suggest that, if the necessary application had been made promptly, they may well have had grounds for an early termination under s 343.  But given the delay in making the necessary application, there was nothing the Member could have done to assist them.  No error has been shown in the decision of the Member. 
  12. [22]
    In those circumstances, any appeal would be hopeless, and therefore the application for leave to appeal must be refused.  The grounds in the amended application for leave the subject of the application to amend do not assist the tenants, and accordingly the appropriate course is also to dismiss that application.  There will be no order as to costs. 

Footnotes

[1] The Act s 227 refers to an application to the Tribunal in circumstances where a tenant of moveable dwelling premises has failed to comply with a notice to relocate.  It had nothing to do with this tenancy.

[2] The RTA held a rental bond of $2,720 in respect of the tenancy.

[3] The agent says the tenants refused to attend the mediation. 

[4] The Act s 295 is concerned with an application by a lessor for termination.  It was not appropriate for an application by a tenant.

[5] Crime and Corruption Commission v Lee [2019] QCATA 38 at [12], citing appellate authority. See also Campbell v Queensland Building and Construction Commission [2021] QCATA 34 at [17].

[6] The day after the filing of the application was the date on which the tenant said the premises would be vacated in a notice, and the date of the hearing was also the date on which the property was relet, so the order would have been unnecessary unless it was backdated in that way..

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Editorial Notes

  • Published Case Name:

    Lobato v Gardian Real Estate Pty Ltd

  • Shortened Case Name:

    Lobato v Gardian Real Estate Pty Ltd

  • MNC:

    [2021] QCATA 130

  • Court:

    QCATA

  • Judge(s):

    Member D J McGill SC

  • Date:

    03 Nov 2021

Appeal Status

Please note, appeal data is presently unavailable for this judgment. This judgment may have been the subject of an appeal.

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