Horizon Housing Realty Pty Ltd v Taleni
[2024] QCATA 4
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- Horizon Housing Realty Pty Ltd v Taleni[2024] QCATA 4
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Horizon Housing Realty Pty Ltd v Taleni[2024] QCATA 4
Horizon Housing Realty Pty Ltd v Taleni[2024] QCATA 4
QUEENSLAND CIVIL AND ADMINISTRATIVE TRIBUNAL
CITATION: | Horizon Housing Realty Pty Ltd v Taleni [2024] QCATA 4 |
PARTIES: | Horizon housing realty pty ltd (applicant/appellant) v ammon taleni and jasmine taleni (respondents) |
APPLICATION NO/S: | APL052-23 |
ORIGINATING APPLICATION NO/S: | MCDT 820-22 |
MATTER TYPE: | Appeals |
DELIVERED ON: | 29 January 2024 |
HEARING DATE: | On the papers |
HEARD AT: | Brisbane |
DECISION OF: | Judicial Member D J McGill SC, presiding Senior Member Traves |
ORDERS: |
|
CATCHWORDS: | LANDLORD AND TENANT – RESIDENTIAL TENANCIES LEGISLATION – JOINDER OF CAUSES OF ACTION AND OF PARTIES – PARTIES – AGENTS – where the lessors’ agent respondent to proceeding by tenants at first instance – agent applied for leave to appeal an order to pay compensation to the tenants – whether the Residential Tenancies and Rooming Accommodation Act 2008 (Qld) s 206 made the agent personally liable – whether the proceeding at first instance should have been brought against the lessors – where the agent applied to join the lessors as a party to the leave application – whether joinder appropriate Residential Tenancies and Rooming Accommodation Act 2008 (Qld) s 24, s 165, s 206. Corcoran v Simon [2016] QCATA 109 Duncan v Friend [2023] QCATA 63 Kostka v Addison [1986] 1 Qd R 416 MacDonald v Melville [2017] QCATA 142 Noosa Hot Properties.com Pty Ltd v Olopai [2012] QCATA 201 Peter McManus Real Estate v Czuchwicki [2016] QCATA 173 Rental Express Pty Ltd v Christensen [2012] QCATA 225 Wardle v De Villiers [2023] QCATA 45 |
APPEARANCES & REPRESENTATION: | 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 – judicial member mcgill
- [1]This is an application for leave to appeal from the decision of an Adjudicator in a tenancy dispute. On 8 February 2023 the Adjudicator ordered that the rental bond be paid by the Residential Tenancy Authority to the respondents, and that the appellant pay the respondents $5,910 within a period of seven days.[1] The appellant filed an application for leave to appeal on 23 February 2023, along with an application to stay the decision pending the determination of the application, and any appeal. On 27 April 2023 the decision was stayed so far as the payment by the appellant was concerned, but not in respect of the repayment of the rental bond.
- [2]On 19 July 2023 the appellant filed an application to join the owners of the premises, the lessors as described in the Residential Tenancies and Rooming Accommodation Act 2008 (Qld) (“the Act”), as a party to the application for leave to appeal. On 7 August 2023 a Member directed that the question, whether the application for leave to appeal should be dismissed because of the terms of s 206 of the Act, be decided as a preliminary matter. On 18 September 2023 the appellant filed an application to rely on additional evidence, namely the retainer of the appellant by the lessors in Form 6 under the Property Occupations Act 2014 (Qld).
- [3]On 22 September 2023 a Member directed that the application to join the lessors be heard in conjunction with the preliminary matter and the application for leave to appeal, and that they be heard on the papers. On 12 October 2023 a Member gave a further direction, that the application to rely on additional evidence also be heard with the others. The appellant has filed submissions in relation to the applications, and a submission in relation to s 206; no submissions have been filed by the respondent, or by the lessors.
Background
- [4]The respondents were, between March 2020 and August 2022, tenants of a residential property owned by the lessors, and managed in respect of the tenancy by the appellant. At some point a dispute arose about the electricity charges the tenant was being asked to pay, although the Adjudicator found that he paid them, in effect under protest. The electricity was at one point disconnected, according to the appellant at the instance of the lessors. The respondent and his family moved into alternative accommodation for a short time, until the electricity was reconnected. At some later time the tenancy came to an end.
- [5]On 8 November 2022 the tenant commenced a proceeding in the Tribunal claiming the return of the rental bond of $3,000. The application was later amended[2] to claim in addition compensation for the disconnection of the electricity, and repayment of all amounts paid as charges for electricity, $5,740.58. The basis on which the third claim was advanced does not appear from the reasons of the Adjudicator, which are meagre. He said simply that it was agreed by both parties that the electricity was incorrectly billed, but they disagreed on the extent.[3]
- [6]The problem seems to have arisen because the tenancy of the property did not extend to a “granny flat” on the same parcel of land, apparently constructed in a shed. It appears that this was occupied by the lessors’ son at the relevant time. The electricity retailer did not provide a separate connection to the granny flat, and it was not on a separate meter provided by the retailer. There was a meter, I suspect provided by the lessors, on the supply to the granny flat, which was supposed to measure the electricity consumed there. The respondents claimed that the agent was supposed to read this meter in the seven day period when the electricity retailer was going to read its meter, so that the consumption charge could be properly divided, but this had not been done.
- [7]The Adjudicator said that this issue was “difficult for me, difficult for the tenant and the agent has no handle on it whatsoever. I am allowing half - $2,850 … .”[4] I assume that the Adjudicator was intending to allow half of the amount claimed by the respondent, which involves some rounding down. He also allowed, as compensation for the disconnection of the electricity, $346 for alternative accommodation, $200 for loss of food, $750 as compensation for loss of quiet enjoyment of the premises and $1,764 for loss of income.
Grounds of appeal
- [8]The matters raised as grounds in the Application for leave to appeal are confined to the proposition that the proceeding in the Tribunal should have been brought against the lessors, as the appellant was just the lessors’ agent, and not a party to the lease. It was said that the agent cannot be held responsible for actions done by the lessors in respect of the lease, and should not be obliged to pay for breaches of the lease by the lessors. The appellant sought to have the decision set aside, and for the respondents to be required to initiate a new claim against the lessors. No ground was advanced as to the merits of the decision, the procedure followed by the Adjudicator, or the adequacy of the reasons of the Adjudicator.
- [9]In submissions in writing the appellant repeated the grounds of appeal, and added that the appellant had not taken any steps to discontinue the electricity, and indeed had urged the lessors not to take that step. Evidence in support of this was said to have been provided to the Tribunal before the hearing, but was not acknowledged or considered by the Adjudicator. This proposition was raised before the Adjudicator, and it would have been appropriate for him to have covered in his reasons the legal position the appellant faced.
- [10]The appellant also submitted that it was not acting as the agent for the lessors in relation to the electricity at the property, so that s 206 does not apply. But s 206 is not concerned with whether the basis of liability of the lessors is an act or omission of the agent as agent for the lessors, but with the pursuit of a claim against the lessors by a proceeding against the agent. The appellant also submitted that the effect of a particular term in the retainer from the lessors was that the appellant had no control over the connection and maintenance of the electricity supply. Again, that misses the point of s 206.
Relevant law
- [11]The Act deals with the issue raised by the appellant in s 206, which provides relevantly as follows:
- (1)On or before the day the tenant starts occupying the premises, the lessor or lessor’s agent must give a written notice to the tenant stating –
- (a)the lessor’s name and address for service; or
- (b)if the lessor has an agent who is authorised to stand in the lessor’s place in a proceeding prescribed under a regulation (the “prescribed proceeding”) – the agent’s name and address for service.
- (2)If a detail mentioned in the notice changes, the lessor or agent must give written notice of the change to the tenant within 14 days after the change.
- (3)If details of the agent mentioned in subsection (1)(b) are given to the tenant under this section, the agent stands in the lessor’s place for a prescribed proceeding and, for example –
- (a)the proceeding may be taken against the agent as if the agent were the lessor; and
- (b)a tribunal may make an order against the agent as if the agent were the lessor; and
- (c)settlement may be made with the agent as if the agent were the lessor.
- [12]This was a “prescribed proceeding”. Clause 43 of the General Tenancy Agreement which was in evidence provided, in the standard form, that the agent may stand in the lessors’ place in any application to a tribunal, subject to any special term providing otherwise. There was no special term to that effect. It follows that this clause activated s 206 for this agreement,[5] so that the proceeding was properly commenced against the appellant, and the order to pay compensation, and to refund part of the electricity charges, was properly made against the appellant, in accordance with the Act. It is not an answer to say that the fault lay with the lessors, because the section says that an order can be made against the agent as if the agent were the lessors. The order was made against the agent because the lessors were liable to the respondents.
- [13]At the end of the proceeding the Adjudicator, in response to a question from a respondent, said that the appellant was liable to pay the money.[6] Strictly speaking the Adjudicator did not have to decide that question, since the enforcement of an order of the Tribunal for the payment of money is a matter for a Magistrates Court.[7] What he said is however consistent with the wording of s 206, and is supported by authority. If it were necessary for me to decide the point, I would hold that this involved no error of law on his part.
- [14]In Noosa Hot Properties.com Pty Ltd v Olopai [2012] QCATA 201 the agent claimed that the lessor was the proper party to the proceeding, and an order for payment of money should not have been made against it. Leave to appeal was refused by Wilson J, the then President of the Tribunal, on the basis that s 206 applied. This decision was followed in Rental Express Pty Ltd v Christensen [2012] QCATA 225, where it was suggested that estate agents who wished to avoid what was described as “personal liability” or the need for indemnity proceedings, had to insert appropriate special conditions in the tenancy agreement: [7]. In that case, however, the appeal was allowed, because the adjudicator had failed to require the applicant tenant to prove his case when the agent did not appear at the hearing.
- [15]In Peter McManus Real Estate v Czuchwicki [2016] QCATA 173 an agent sought leave to appeal on the ground that it should not have been liable to pay money to the tenant, but leave was refused. Carmody J held that the effect of s 206 was that the proceeding was properly brought against the agent, and noted that no application had been made to the Tribunal to join or substitute the lessor. His Honour said at [14]:
Any claim the applicant has against the lessor for contribution or indemnity will have to be the subject of fresh proceedings in a competent forum. In the meantime, the applicant is legally bound to pay the compensation to the tenants in the amount ordered.
- [16]I acknowledge that it is possible that s 206 could have a different interpretation, and operate in a different way. The clear purpose of s 206 is to enable proceedings in the Tribunal to occur between the tenant and the agent, because that is more convenient for the tenant. The Act does not really explain what “standing in the lessor’s place” means, except to say that the agent can be named as the party rather than the lessor, an order can be made against the agent as if the agent were the lessor, and the agent can settle the proceeding with the tenant. But does the order against the agent take effect as an order against the agent personally, or against the lessor, in whose place the agent stands?
- [17]I am not aware of any further guidance in the authorities about this issue, or any other statutory provisions in similar terms.[8] The common law provides little guidance. If the identity of a principal was known, a third party generally could not sue an agent, and an agent could not sue on a contract made on behalf of a principal in its own name although it could if authorised by the principal pursue a claim in the name of the principal against the third party. In the case of a contract made by an agent on behalf of an undisclosed principal, acting within the scope of the actual authority of the agent, the third party could sue the agent personally, although if the identity of the principal became known, and the principal was also a defendant, the third party was required to elect before judgment between the defendants.[9] The only possible guidance this provides is that, at common law, if an agent could be sued to judgment it became personally liable. Clearly the legislative intention was to produce something different from the common law position.
- [18]There have been other decisions where it has been said that the effect of the Act is that the agent and the lessor are interchangeable. These have arisen in a context where a lessor has sought to appeal against a Tribunal decision although not a party to the proceeding at first instance, which on its face is inconsistent with the QCAT Act s 142. In Corcoran v Simon [2016] QCATA 109 it was said at [9] that the effect of s 206 and s 24 of the Act was to make “the lessor and the lessor’s agent interchangeable for rights and obligations under that Act.” It was held that in these circumstances the lessor could apply for leave to appeal, and the same result followed in Wardle v De Villiers [2023] QCATA 45, where s 206 was described at [6] as “a legal fiction whereby a lessor is effectively a party to the proceeding although bearing the agent’s name.” In Duncan v Friend [2023] QCATA 63 it was said at [17] that, “by the decision, the lessor was ordered to pay” the tenant a particular sum, and that the lessor was taken to be a party to the proceeding because of the QCAT Act s 39(b).
- [19]There are difficulties with this reasoning, in my opinion. With respect, I do not think that the effect of s 24 of the Act is that a reference to one of the lessor or the agent is a reference to the other. The section, which I need not quote, is concerned with the operation of a mandatory provision of the Act, and only where such a provision requires something to be done by “the lessor or lessor’s agent”, being the agent to do the required act. Both are under the obligation to do it, so that both commit an offence if it is not done, but if either does the act, it discharges the obligation for both of them. Unless a provision makes an application to the Tribunal mandatory by one or the other, it would not apply in that context. Even then, I cannot see how it would make them both parties to the proceeding. The whole point of the section is to cope with the fact that the lessor and the agent are separate parties.
- [20]As for s 39(b), I have difficulty in seeing that the Act provides anywhere that the lessor is a party to the proceeding if the agent is a party, unless the effect of s 206 is that the agent stands in the place of the lessor so that the real party to the proceeding is the lessor, and the agent in effect conducts the proceeding for the lessor in its own name.
- [21]A further difficulty with these decisions is that they are inconsistent with the decision of Carmody J in MacDonald v Melville [2017] QCATA 142, where his Honour held that the lessors were not competent to appeal against an order made against the agent unless they successfully applied to be substituted for the agent under the QCAT Act s 42(1): [23]. An application for joinder was refused, along with leave to appeal, and it was said at [27] that the agent was “exposed to enforcement action for not complying with” the order of the Tribunal.
- [22]It may be that this decision was the inspiration for the application by the appellant to join the lessors as parties to the application for leave to appeal. But in my opinion that application is now too late. The appellant does not suggest that the application to join or substitute the lessors was made during the proceeding at first instance; if that had occurred, the agent could have applied for leave to appeal on the ground that the Adjudicator erred in failing to grant that application. Leaving aside any technical objections, which I regard as significant, it has not been shown that it is not more convenient and appropriate for the appellant simply to pursue separately its claim for an indemnity, in the Tribunal or a Magistrates Court if the order has been satisfied, or in the Supreme Court if the appellant seeks an order that its liability to the respondents be discharged by the lessors.[10]
- [23]If the application for joinder is refused, there is no relevance in the proposed additional evidence, and that application is also properly refused. As to costs, there is no reason to allow costs to the appellant, and the other parties have taken no active part in the proceeding, so cannot have any basis for an order for costs. In my opinion, the decision of the Appeal Tribunal should be as follows:
- 1.The application filed 19 July 2023 to join the lessors as parties to the application for leave to appeal, and the application filed on 18 September 2023 to rely on additional evidence, are refused.
- 2.Leave to appeal from the decision of the Tribunal on 8 February 2023 is refused.
- 3.The stay of enforcement of the decision imposed on 27 April 2023 is lifted.
- 4.There be no order as to costs.
Recovery of electricity charges
- [24]Although the issue does not arise in the application for leave to appeal, I propose to say something about the recovery of electricity charges under the Act. The matter is dealt with by s 165, as charges for electricity are service charges for the purposes of the Act. The section draws a distinction between premises which are individually metered and those which are not. In the latter case, subsection (2) provides:
If the premises are not individually metered for the service or facility, the tenant may be required to pay an amount for the outgoings only if the agreement states—
- (a)the service or facility for which the outgoings are payable; and
- (b)how the apportionment of the outgoings to the tenant will be worked out; and
- (c)how the outgoings may be recovered by the lessor from the tenant.
- [25]The tenancy agreement in evidence in this matter provided in Item 13 of the Schedule to the general tenancy agreement that the “apportionment of the cost of the service for which the tenant must pay” was, for electricity, “100% of metre usage”, although there was also a note “see special terms p 8.” Item 14, which dealt with how the services must be paid for, said for electricity “within 28 days from invoice from agent.” Clause 16 of the standard form provided that Item 13 stated how the tenant’s apportionment of the cost of the service is to be worked out, and that Item 14 stated how the tenant must pay for the service.
- [26]Page 8 of the Schedule included a number of special terms, including:
As the electricity to the property is on one account, the owner has the account in their name. Upon receipt of each invoice from the electricity provider, the agent will invoice the tenant for the proportion of the electric usage as per the metre readings at the property. Payment of this invoice is to be made within 4 weeks of invoice date.
- [27]It is immediately apparent that the special term and the figure of 100% in Item 13 are inconsistent. One provides that the tenant pays a proportion of the usage (not the total charges) and the other provides that the tenant pays the lot. As well, is the period allowed the tenant for payment four weeks from the invoice date, or four weeks from when the tenant receives the invoice, which is what Item 14 provides? There was an argument that the tenant was not obliged to pay anything for electricity, on the basis that s 165(2) had not been complied with.
- [28]On the other hand, there is nothing in the agreement about the respondents’ claim that the meter for the granny flat was to be read within a seven day period. As well, the respondents’ argument that they were not obliged to pay more than the amount charged by the electricity supplier for supply to the premises is not supported by s 165(3), because the limitation in s 165(3)(b)(ii) only applies if the premises (that is, the premises subject to the tenancy) are individually metered. If not, it all depends on the terms of the agreement: s 165(3)(a).
- [29]The Act does not make it easy for lessors of premises where the services are not individually metered.
SENIOR MEMBER TRAVES
- [30]I agree with the reasoning and Orders proposed by Judicial Member McGill.
Footnotes
[1] I shall refer to Horizon Housing Realty Pty Ltd as the appellant, and to Ammon and Jasmine Taleni as the respondents.
[2] Perhaps on 5 December 2022. The file as available to the Appeal Tribunal is in disarray.
[3] Transcript 8 February 2023 p 8. The appellant admitted an overcharge of $95.41: p 5.
[4] Ibid at p 9.
[5] Noosa Hot Properties.com Pty Ltd v Olopai [2012] QCATA 201 at [15]; Peter McManus Real Estate v Czuchwicki [2016] QCATA 173 at [11].
[6] Transcript 8 February 2023, p 9.
[7] Queensland Civil and Administrative Tribunal Act 2009 (Qld) (“the QCAT Act”) s 131, s 132.
[8] There does not appear to be an equivalent provision in the Residential Tenancies Act 2010 (NSW); we have not checked other states.
[9] See Turner, Australian Commercial Law (28th Ed, 2011) pp 214 – 217; Traves, Commercial Law, 6th edition, Lexis Nexis, 2024 at 137 - 142.
[10] Kostka v Addison [1986] 1 Qd R 416 at 419, 420. An order to discharge a liability is a form of equitable relief, so requires a court with equitable jurisdiction.