Jones v Jones[2023] QCATA 30

QUEENSLAND CIVIL AND ADMINISTRATIVE TRIBUNAL

REASONS FOR DECISION

1. [1]
   This is an application for leave to appeal and, if leave is granted, an appeal against the orders of a Magistrate sitting as a Tribunal Member in a Minor Civil Dispute. Those orders were for termination of a residential tenancy agreement for failure to leave pursuant to the Residential Tenancies and Rooming Accommodation Act 2008 (“the RTRAA”) and for the issue of a Warrant of Possession directed to the Queensland Police Service to enter premises and give possession of them to the Respondent to this Application, who was the applicant in the original application. 

FACTUAL BACKGROUND

2. [2]
   The Applicant and the Respondent are brother and sister.  In or around 2007, a property was purchased at Innes Park in Queensland and registered in the sole name of the Respondent. There does not appear to be any dispute that the Applicant contributed the sum of $60,000 that was put towards the purchase price of the property which was said to be $257,000. The Respondent obtained a first home owners’ grant from government and contributed that to the purchase price also. The balance of the purchase price was obtained by borrowing from a financial institution, whose loan was secured by mortgage registered over the property. The loan and mortgage were in the Respondent’s sole name. The Applicant asserts also that she contributed a further $30,000 towards improvements to the property. 
3. [3]
   After the purchase of the property, the Applicant and the Respondent lived together in the property for several years. Each contributed equally, it is said (by the Applicant, at least) to the mortgage repayments and other outgoings such as the local authority rates during that time.
4. [4]
   After around four years, the Applicant’s circumstances changed and she moved to Newcastle in New South Wales. Her case is that she was expecting the property to be sold after she moved out, with the Respondent taking care of that. That did not happen.
5. [5]
   The Respondent continued to live in the property, with others living there too, paying rent, through until around 2018. Around then, the Respondent moved out and permitted other third party tenants to move in and rent the property.
6. [6]
   In or around November 2020, the Applicant sought to move back to Queensland and back into the property. She sought permission from the Respondent. He presented a formal written General Tenancy Agreement to the Applicant. She did not sign that, but moved back into the property in January 2021. She began paying the Respondent an agreed amount each week, that she asserts was being paid towards the mortgage repayments, rates, water, and other outlays. The Respondent presented the Applicant with another copy of the formal written General Tenancy Agreement. It described himself as the lessor and the Applicant as the tenant. Again, the Applicant did not sign it.
7. [7]
   They continued to have disagreements and the Respondent asked the Applicant to leave the property. She would not. He served her with a formal Notice to vacate by a certain date. She did not vacate the property. The Respondent then applied to this Tribunal and obtained the Orders that I have identified above on 7 September 2021.
8. [8]
   Unhappy with that outcome, the Applicant lodged the Application for leave to appeal against the decision and applied for a stay of the first instance orders pending the determination of her application. She obtained the stay.
9. [9]
   I am determining this application on the papers. It has been awaiting decision for many months. Any inconvenience that has caused the parties is regrettable.

The First Instance Decision

10. [10]
    At the hearing of the original application before the Acting Magistrate sitting as the Tribunal in its Minor Civil Jurisdiction, the Applicant appeared for herself, as is usual in this Tribunal. She told his Honour that she was “the rightful owner” of the property and was not living there as a tenant. She told his Honour that although a tenancy agreement had been presented to her, she did not sign it as it would be “ridiculous” to do so, as it was her house. The Applicant began by telling his Honour that she had paid the entire “bond”, but it is clear from the entire transcript that she meant the entire “deposit” to purchase the house.
11. [11]
    The Applicant told his Honour that she and her brother had a verbal agreement when the house was purchased in 2007 centred around helping each other out. The Applicant told his Honour that she had received a large sum of money when her fiancé, who was in the Army, had died. After having to deal with some litigation commenced against her by his family, she had around $100,000 left. She “blew” $10,000 but decided to invest $90,000. She and her brother got together, she said, and bought the property. She said they agreed that she would put up a deposit of $60,000 and he would use his good credit rating and his secure employment to borrow the balance purchase price. He would also be able to obtain the first home owners’ grant and contribute that.
12. [12]
    The title of the property was registered in the Respondent’s sole name, but the Applicant told his Honour that pursuant to their verbal agreement she also put another $30,000 into paying for improvements to the property. She said they agreed, nevertheless, that they would later sell the property and when they did, she was to receive the first $75,000 of the proceeds of sale, presumably after the mortgage was paid out, and that any balance would then be split equally between them.
13. [13]
    The Applicant told his Honour that her brother had not honoured the agreement to sell the property, but that eventually they agreed for her to move back into the property. She conceded that the Respondent had presented her with a Tenancy Agreement that he wanted her to sign, but that she did not sign it, not believing she was a tenant.
14. [14]
    The Acting Magistrate referred to and relied on the material the Respondent had filed in support of his original Application. His Honour noted that the title was registered in the Respondent’s sole name. He noted that the Respondent had presented the Applicant with a draft Tenancy Agreement for her to sign. His Honour said to the Applicant during the hearing “[b]ased on the material before me I have to evict you”.  
15. [15]
    His Honour said he was satisfied that the Respondent had signed and served on the Applicant a proper notice to leave pursuant to s 326 of the RTRAA. His Honour said he was satisfied he had jurisdiction as the application was statutorily an urgent application and could be heard and determined without the parties having to participate in conciliation through the Residential Tenancy Authority.
16. [16]
    Significantly, in my view, his Honour correctly observed that the Applicant’s evidence and submissions before him “seem to relate to a breach of oral contract from many years ago and they seem to relate to issues around a constructive or resulting trust of which the Tribunal has no jurisdiction to make orders” [italics added].  His Honour said in furtherance of this point:-

The [Applicant] is aware of the Tribunal’s limited jurisdictional purview and the Tribunal has attempted to ensure that the [Applicant] is aware that she may have rights to pursue her claims but in courts of appropriate and competent jurisdiction.

17. [17]
    The learned Acting Magistrate went on:-

The [Applicant’s] case is that she is in fact the owner of the property but that is a matter that needs to be determined in a different jurisdiction. There is no evidence before me to support the allegations made by the [Applicant] in that regard. The information that was provided by the [Applicant] is not clear, it is not probative in any manner, and the opportunity I provided to the [Applicant] to expand upon the telephone evidence resulted in a lengthy statement of a combination of facts and intended legal principles that have no bearing on this matter, at least in this jurisdiction. [Emphasis added]

18. [18]
    His Honour found:-

I conclude that, despite the protestations of the [Applicant] the [Respondent] is the owner of the property insofar as the purposes of today’s proceedings is concerned. [Emphasis added]

The Application for Leave to Appeal and the Appeal

19. [19]
    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] Leave to appeal is also required where an appeal is in relation to questions of fact and/or mixed fact and law.^[2] 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.^[3]
20. [20]
    For the Applicant, it is submitted that leave should be granted as the decision to terminate a tenancy and issue a warrant of possession should not have been made because the dispute between the parties is actually not a tenancy dispute and is not one within the Tribunal’s minor civil dispute jurisdiction. It is further submitted for the Applicant that the learned Acting Magistrate did not give adequate reasons for dealing with the matter as a tenancy dispute other than acknowledging that he did not have the jurisdiction to deal with the Applicant’s equitable claim.
21. [21]
    The Respondent submits that the Acting Magistrate did have jurisdiction to hear the dispute because it was a tenancy matter. He submits that the Applicant’s failure to commence action to determine her equitable claim to an interest in the property is fatal to her appeal. He also submitted that the learned Acting Magistrate did give adequate reasons for his decision.

My Determination

22. [22]
    There is no doubt that the learned Acting Magistrate correctly determined that the Tribunal does not have jurisdiction to determine a claim in equity for an interest in real property. His Honour was right in saying he could not determine that. However, just as her Honour, Kingham DCJ, Deputy President, remarked in King v King [2010] QCATA 84 at [22]–[23] in a very similar factual situation:-

… that did not mean that the evidence given about that matter was not relevant to his function as an adjudicator on this claim.

In deciding the only cogent evidence was that there was a residential tenancy in existence, with respect, the learned adjudicator erred.

23. [23]
    In King v King, Kingham DCJ went on to say at [24]:-

In order to succeed in their claim, the King siblings had to establish that [their father’s] right to occupy the premises arose from a residential tenancy agreement. [His] evidence was that the document proffered by [his children – the registered owners of the property] is not the source of his right to occupy. … If [his] claim is established, there is no residential tenancy agreement within the meaning of the RTRA Act and QCAT could not have made an order to evict [him] from the premises.

24. [24]
    I am quite satisfied that this is a very similar type of dispute with a very similar first instance decision having been made by the learned Acting Magistrate. There was evidence before the Tribunal from the Respondent that the Applicant had indeed put $60,000 towards the purchase of the property, though described as a loan to him to purchase the property. The Respondent’s evidence was that the terms of the loan were that when he had sufficient equity in the property he would borrow further money and would repay the Applicant and would also assist her in paying a deposit on “any accommodation that she might find”.  His evidence was that it was alternatively agreed that he would sell the property and give her a share of any profits, but that it was not intended that she would have an interest in the property.
25. [25]
    Clearly, there was no dispute between the parties that the Applicant had put a large amount of money up at the time of the purchase of the property. Rather, the dispute was about the terms upon which the money was put up and whether, by agreement, or the circumstances alone, the Applicant had actually acquired an equitable interest in the property. Whilst the learned Acting Magistrate did say that he preferred the evidence of the Respondent, the way in which he dealt with the evidence, in my judgment, was skewed by his acknowledgment, which he repeated a number of times, that he had no jurisdiction to decide the equitable claim and that such claim would have to be decided elsewhere. Respectfully, the learned Acting Magistrate appears to have ignored the complete lack of detailed particulars given by the Respondent that would support findings that the money put up by the Applicant was a loan and not a purchase of equity in the property, such that would support a declaration of a resulting trust.
26. [26]
    Just as Kingham DCJ remarked of the first instance decision maker in King v King at [28], the learned Acting Magistrate appears to have “considered he had no option but to proceed on the basis of the evidence that a tenancy agreement was in existence. Respectfully, he erred in that conclusion. He was not so constrained and there were other options open to him.” [Italics added]
27. [27]
    Her Honour said at [29]–[32]:-

Before making a final decision in a proceeding, the tribunal has the power to make an interim order it considers appropriate, in the interests of justice, to protect a party’s position for the duration of the proceeding or, to require or permit something to be done to secure the effectiveness of the exercise of the tribunal’s jurisdiction^[4].

The learned adjudicator could have made interim orders which afforded [Mr King] the opportunity to have his claim determined by a court of competent jurisdiction, before the residential tenancy claim was determined. At one point during the hearing, it seems that was what the learned adjudicator had in mind.

In this case, as in so many others, the learned adjudicator was required, in an abbreviated hearing, under time pressure, with inadequate evidence and without the assistance of submissions on the law, to quickly determine a matter of some complexity.

In that context, respectfully, the learned adjudicator erred in concluding the only cogent evidence was that a residential tenancy agreement was in existence. He also erred in concluding that he had no alternative but to proceed with the residential tenancies claim, even though there was a clear dispute about the basis of [Mr King’s] right to occupy the premises. That is sufficient ground to grant leave to appeal.

28. [28]
    I find myself adopting the same reasoning as her Honour in this matter. I am satisfied that the learned Acting Magistrate erred in determining, because he did not have jurisdiction to determine the Applicant’s clear equitable claim, that he must go with the RTRAA claim of the Respondent and terminate a tenancy and issue a Warrant of Possession. The just and equitable disposition of the matter would have been to make some interim orders, adjourn the hearing to give the Applicant a reasonable time to take some formal steps in another jurisdiction to assert her equitable claim and only to bring it back and determine it further on a final basis if she did not do that.
29. [29]
    Having determined that there is an error to be corrected, I consider that a substantial injustice would also be done in this matter if leave to appeal was not granted. So, I grant leave to appeal. From there, I also consider the course adopted by Kingham DCJ in King v King is the appropriate way to deal with this appeal. This is all based on an assumption that the Applicant and the Respondent have not resolved their dispute in the period of time since the Applicant lodged her Application for Leave to Appeal and obtained her stay of the first instance decision and continues to occupy the property. There has been some material filed in the matter since that time that suggested to me on my reading of the papers determining this Application, that the Applicant might have already surrendered possession of the property to her brother. However, I was informed last week that the Applicant had contacted the QCAT Registry inquiring as to when this decision might be expected. I take it from that information that it is likely that the Applicant still occupies the property and is awaiting this decision. Accordingly, I consider there is merit in going on to determine it.
30. [30]
    I will order that the first instance decision continue to be stayed until this appeal is finally determined. I will order that the final determination of this appeal be stayed until 4.00 pm on Friday, 5 May 2023. Between now and then, if the equitable dispute between the Applicant and the Respondent has not been resolved by binding agreement between them or, alternatively, if the Applicant has not commenced proceedings in a Court of competent jurisdiction to pursue her claim of an equitable interest in the subject property, the stay will be lifted by further order by me and the appeal finally determined. If the Tribunal is notified by 4.00 pm on Friday, 5 May 2023 by the Applicant that she has commenced proceedings in a Court of competent jurisdiction to determine her claim to an equitable interest in the property, the stay will be continued until such time as the Tribunal is notified those proceedings have been finalised by binding agreement between the parties or by judicial determination. After that, the Appeal will be finalised one way or another.
31. [31]
    I make the orders that are set out at the commencement of these written reasons.