Civil and Administrative Tribunal New South Wales Medium Neutral Citation: McCracken v Carbone [2022] NSWCATCD 107 Hearing dates: 25 March 2022 Date of orders: 27June 2022 Decision date: 27 June 2022 Jurisdiction: Consumer and Commercial Division Before: D Moujalli, Senior Member Decision: 1. The application in RT22/04850 is dismissed. 2. In application RT22/09776, the rent shall not exceed $350 per week from 13 April 2022 to 13 April 2023. Catchwords: LEASES AND TENANCIES – Rent increase – Fair rent – Comparable premises - Retaliatory termination notice Legislation Cited: Residential Tenancies Act 2010 (NSW) Cases Cited: Baltov v Casaceli [2021] NSWCATCD 91 De Bruyne v Ray White Waterford [2020] QCATA 113 Howard v B Miles Womens Foundation Inc [2012] NSWSC 1173 Nulla Nulla Aboriginal Land Council v Lucas [2013] NSWCTTT 219 Texts Cited: Nil Category: Principal judgment Parties: Timothy McCracken (Applicant) Guiseppe Carbone (Respondent) Representation: Applicant (Self-represented) Respondent (Self-represented) File Number(s): RT22/04850 and RT22/09776 Publication restriction: Nil REASONS FOR DECISION Introduction 1. The applicant is the tenant of residential premises owned by the respondent who is the landlord of the premises. 2. The applicant has lodged two applications with the Tribunal against the respondent. 3. The first application was lodged on 4 February 2022 and has been allocated file number RT22/04850. In this application, the applicant seeks an order under s 115 of the Residential Tenancies Act 2010 (NSW) (RTA) that a termination notice issued by the respondent has no effect because it is a retaliatory notice (the Section 115 Application). 4. The second application was lodged on 4 March 2022 and has been allocated file number RT22/09776. In this application, the applicant seeks an order under s 44 of the RTA that a rent increase is excessive (the Section 44 Application). 5. Both Applications were listed for hearing on 25 March 2022 and were heard together on that date. 6. At the hearing on 25 March 2022, both parties appeared without legal representation. 7. The hearing on 25 March 2022 proceeded by telephone. At the hearing each party was given an opportunity to present their evidence, ask questions of the other party and make submissions. 8. The dispute between the applicant and respondent arises from their relationship as the tenant and landlord respectively under a residential tenancy agreement governed by the RTA. The Tribunal therefore has jurisdiction to hear and determine the matter pursuant to the powers granted to it under the RTA in respect of residential tenancy agreements. Evidence 1. In determining the Application, the Tribunal has had regard to the following: 1. The material filed by the applicant on 22 March 2022 in RT22/09766. This was marked Exhibit A1 at the hearing on 25 March 2022. 2. The material filed by the applicant on 23 March 2022 in RT22/04850. This was marked Exhibit A2 at the hearing on 25 March 2022. 3. The material filed by the respondent on 22 March 2022. This was marked Exhibit R1 at the hearing on 25 March 2022. 4. The further material filed by the respondent on 23 March 2022. This was marked Exhibit R2 at the hearing on 25 March 2022 5. The oral evidence and submissions of the parties at the hearing on 25 March 2022. 1. The findings made by the Tribunal on the basis of the above evidence is set out below. Assessment of the Evidence and Findings of Fact 1. It is necessary to make some general comments about the applicant's evidence before setting out the specific findings of fact which can be made on the basis of the evidence before the Tribunal. 2. The applicant's evidence has made it extremely difficult for the Tribunal to ascertain the key facts contended for by the applicant in support of his claims. Much of the applicant's evidence contains highly personal and offensive attacks on the respondent's character. The applicant states that the respondent is "malicious and vexatious". The applicant also asserts that the respondent has provided false evidence to the Tribunal but does not particularise or substantiate this allegation. 3. The applicant relies upon an email which he sent on 1 December 2021 in which he refers to the respondent in the following terms: The landlord is 72 years old, an old ignorant Italian "westie bogan". 1. In the same email the applicant refers to the respondent as an "idiot" and as having an "ignorant way of thinking". The applicant also makes allegations that the respondent has been involved in fraudulent and unlawful conduct. 2. The applicant's allegations that the respondent has engaged in improper, fraudulent or unlawful conduct are unparticularised and unsubstantiated. It is regrettable that they were made. The same applies to the personalised attacks on the respondent's character. It is difficult to see how it is not an abuse of the Tribunal's processes to make such allegations in the manner in which they have been made. The allegations are rejected by the Tribunal. In any event, it is difficult to see how they can assist the Tribunal in determining the legitimate issues which arise on the applications. 3. Having made these general comments about the applicant's evidence, I will now turn to the specific findings of fact which can be made on the basis of the evidence presented to the Tribunal. 4. On 12 May 2021, the applicant and the respondent entered into a residential tenancy agreement (Tenancy Agreement). The Tenancy Agreement specified that it was for a period of 3 months starting on 12 May 2021 and ending on 11 August 2021. It specified a weekly rent of $280. 5. The residential premises are a granny flat which is attached to the main premises on the property. There is a door separating the granny flat from the main property. The main property is occupied by the respondent. The respondent lives in the main property with his 20 year old son. The respondent gave evidence, which I accept, that he provides emotional support and care for his son. I note that the applicant disputed that the respondent's son lives with him. I accept the respondent's evidence that his son lives with him. I consider that the respondent is in a better position than the applicant to indicate to the Tribunal who resides with the respondent in the main part of the premises. 6. The relationship between the applicant and the respondent was initially amicable. The respondent gives evidence that when the applicant first moved into the residential premises, either the respondent or his son would regularly collect mail for the applicant and deliver it to him. I accept the respondent's evidence in this respect. 7. From about late June to early July 2021, the relationship between the applicant and the respondent started to deteriorate. The applicant states that the relationship became "very toxic". The applicant attributes this to the respondent's "abusive and unlawful behaviour". There is no evidence to substantiate the applicant's assertion that the respondent engaged in abusive and unlawful behaviour and I reject the applicant's assertion in this respect. It is relevant, however, for reasons which I will explain later, that the relationship between the applicant and the respondent has been acrimonious from about July 2021. 8. On 12 August 2021, the applicant was notified that the rent was being increased from $280 per week to $300 per week. This rent increase took effect on 9 September 2021. 9. On 16 August 2021, the respondent served a termination notice on the applicant (the First Termination Notice). 10. In an email sent on 1 December 2021 to his solicitor, the applicant states that he and his dog were attacked by the respondent's dog. There are numerous references in the applicant's material to being attacked by the respondent's dog. I find that this did not occur. There is no photographic evidence of any injuries sustained by the applicant or his dog as a result of the alleged attack by the respondent's dogs. There is no evidence of either the applicant or his dog requiring medical or veterinary assistance as a result of any alleged attack. 11. The respondent gives evidence that his dog has never attacked anyone and I accept the respondent's evidence. The respondent's evidence is corroborated by statements from other witnesses who state, for example, that the respondent's dog "never once has...shown any signs of aggression to me or anyone that was with me"; that the respondent's dog "is a very gentle loving pet"; and that he "has always been friendly and playful". I accept the evidence contained in the statements relied upon by the respondent as to the nature and character of his dog. 12. In the email of 1 December 2021, the applicant states that he "hit and kicked" the respondent's dog. 13. In an another email sent on 25 December 2021 to his solicitor, the applicant states that he "grabbed the dog by the throat" and that he threw the dog over a balcony. I do no accept the suggestion in the applicant's email that he had to do this to protect himself and his dog. 14. Needless to say, the applicant's violent conduct towards the respondent's dog is profoundly disturbing. I reject the applicant's evidence that his violent conduct towards the respondent's dog was for the purpose of defending either himself or the applicant' dog. I find that the applicant has engaged in gratuitous acts of violence towards the respondent's dog. 15. On 17 December 2021, the Tribunal determined that the First Termination Notice had not been served properly. 16. On 17 December 2021, following the decision of the Tribunal, the respondent served a further termination notice on the applicant (the Second Termination Notice). The Second Termination Notice indicated that it was being served pursuant to section 85 of the RTA and also nominated 22 March 2022 as the date for the tenant to deliver up vacant possession of the premises. 17. The Second Termination Notice was served on behalf of the respondent by his property manager. 18. Following service of the Second Termination Notice, the applicant sent an email to the respondent's property manager in which he stated the following: Hilarious Are you that stupid??? Retaliatory eviction Your license gone 1. The terms of the above email were grossly discourteous. 2. Included in the applicant's material are copies of emails which he sent in December 2021 to his solicitor. 3. On 3 February 2022, the applicant's solicitor wrote to the respondent's property manager. In that letter, the applicant's solicitor stated that the respondent's dog, a German Shepard, had attacked Mr McCracken and his dog on several occasions. The letter continued to state that the attacks had caused injuries to both Mr McCracken and his dog. There is no evidence to substantiate the assertion that the respondent's dog had attacked the applicant and his dog. As I have already noted, there is no evidence that any injuries were sustained, for example, photographic evidence or any medical or veterinary treatment having been sought or received. I reject any contention by the applicant that he and his dog had been attacked by the respondent's dog. 4. In his statement dated 22 March 2022 (which forms part of Ex R1), the respondent gives evidence that after he received the letter of 3 February 2022, he went to see the applicant to discuss the alleged attack by the respondent's dog. The respondent gives evidence that this was the first time he had been notified of an alleged attack by his dog. The respondent states that when the applicant saw him approaching, the applicant rushed towards him and started hitting him in the chest with the open palm of his hands and yelled at him with words to the effect: "get out, get out, you're trespassing". The respondent states that he attempted to tell the applicant that he had come out of concern to enquire about the applicant's dog. However, the applicant kept screaming at the respondent and hitting him in the chest with his hands. The respondent reported the matter to the police, however, he did not wish charges to be pressed. I accept the respondent's evidence in relation to this incident. 5. On 10 February 2022, the respondent's property manager wrote to the applicant to inform him that the rent was to be increased from $300 to $450 per week. The letter stated that the increase was to take effect on 13 April 2022. 6. The applicant's evidence includes material downloaded from the internet in relation to residential premises in various parts of western Sydney. The advertised rent for these premises is between $260 per week and $350 per week. The applicant has made an assessment as to whether he considers these premises to be either superior or comparable to the residential premises which he is currently occupying. 7. This applicant's evidence of other rental properties is of very limited assistance to the Tribunal. It contains very limited information about the properties. It contains a photograph of the exterior of the premises, their address and an indication of how many rooms are located in the premises. There is no evidence as to the condition, size and layout of the interior of the premises. Further, the applicant does not provide an explanation as to the criteria he has applied to determine whether the properties are superior or comparable to the premises which he is currently occupying. He does not appear to have inspected any of the properties and does not have experience or expertise as a real estate agent to draw upon in making an assessment as to whether the properties are superior or comparable to the one which he is presently occupying. Applicable Law 1. Section 44 of the RTA provides relevantly: 44 Tenant's remedies for excessive rent (1) Excessive rent orders The Tribunal may, on the application of a tenant, make any of the following orders— (a) an order that a rent increase under an existing or proposed residential tenancy agreement is excessive and that, from a specified day, the rent for residential premises must not exceed a specified amount, (b) an order that rent payable under an existing or proposed residential tenancy agreement is excessive, having regard to the reduction or withdrawal by the landlord of any goods, services or facilities provided with the residential premises and that, from a specified day, the rent for residential premises must not exceed a specified amount. (2) Time limit for excessive rent increase applications An application for an order that a rent increase is excessive must be made within the period prescribed by the regulations after notice of the increase is given. (3) Applications on withdrawal of goods or services A tenant may, before the end of a tenancy, make an application that the rent is excessive, having regard to the reduction or withdrawal of any goods, services or facilities provided with the residential premises, even if those goods, services or facilities were provided under a separate or a previous contract, agreement or arrangement. (4) Determination of excessive rent For the purposes of making an order under this section, the Tribunal may declare that amounts payable under a contract, agreement or arrangement under which goods, services or facilities are provided to the tenant are rent. (5) The Tribunal may have regard to the following in determining whether a rent increase or rent is excessive— (a) the general market level of rents for comparable premises in the locality or a similar locality, (b) the landlord's outgoings under the residential tenancy agreement or proposed agreement, (c) any fittings, appliances or other goods, services or facilities provided with the residential premises, (d) the state of repair of the residential premises, (e) the accommodation and amenities provided in the residential premises, (f) any work done to the residential premises by or on behalf of the tenant, (g) when the last increase occurred, (h) any other matter it considers relevant (other than the income of the tenant or the tenant's ability to afford the rent increase or rent). (6) Effect of excessive rent order An order by the Tribunal specifying a maximum amount of rent— (a) has effect for the period (of not more than 12 months) specified by the Tribunal, and (b) binds only the landlord and tenant under the residential tenancy agreement or proposed residential tenancy agreement under which the rent is payable. 1. Section 115 of the RTA provides as follows: 115 Retaliatory evictions (1) The Tribunal may, on application by a tenant or when considering an application for a termination order or in relation to a termination notice— (a) declare that a termination notice has no effect, or (b) refuse to make a termination order, if it is satisfied that a termination notice given or application made by the landlord was a retaliatory notice or a retaliatory application. (2) The Tribunal may find that a termination notice is a retaliatory notice or that an application is a retaliatory application if it is satisfied that the landlord was wholly or partly motivated to give the notice or make the application for any of the following reasons— (a) the tenant had applied or proposed to apply to the Tribunal for an order, (b) the tenant had taken or proposed to take any other action to enforce a right of the tenant under the residential tenancy agreement, this Act or any other law, (c) an order of the Tribunal was in force in relation to the landlord and tenant. (3) A tenant may make an application to the Tribunal for a declaration under this section before the termination date and within the period prescribed by the regulations after the termination notice is given to the tenant. Consideration of the Section 115 Application 1. Relevantly for the present circumstances, section 115(1) of the RTA confers a discretion on the Tribunal to declare that the Second Termination Notice has no effect if its is satisfied that the termination notice given by the landlord was a retaliatory notice. 2. Section 115(2) of the RTA provides that the Tribunal may find that that Second Termination Notice is a retaliatory notice if it is satisfied that the landlord was wholly or partly motivated to give the notice for the reason that: 1. the tenant had applied or proposed to apply to the Tribunal for an order; or 2. the tenant had taken or proposed to take any other action to enforce a right of the tenant under the residential tenancy agreement, the RTA or any other law; or 3. an order of the Tribunal was in force in relation to the landlord and tenant. 1. For the discretion conferred by s 115(1) of the RTA to arise, the Tribunal is to be satisfied that the Second Termination Notice was wholly or partly motivated by one of the factors specified in s 115(2)(a), (b) or (c). The applicant did not present evidence or submissions that would allow the Tribunal to be satisfied of this. 2. The main problem for the applicant in this respect is that the First Termination Notice was issued on 16 August 2021. That indicates that the respondent had formed an intention to issue a termination notice by that date. The fact that the Second Termination Notice was issued shortly after the Tribunal determined that the First Termination Notice was not properly served supports an inference that the motivation for issuing the Second Termination Notice was to regularise the defects in service of the First Termination Notice. 3. The applicant gave evidence that during the proceeding in the Tribunal in December 2021 in relation to the First Termination Notice he indicated that he would be taking legal action against the respondent. He appears to contend that because the Second Termination Notice was issued after the first proceeding in the Tribunal, it was in retaliation to the statements made by the applicant about pursuing certain legal rights. 4. It has been pointed out that a decision maker should be careful to "… avoid the fallacy post hoc ergo propter hoc. In other words, that fact that 'A' precedes 'B' does not necessarily mean that 'A' caused 'B'": see De Bruyne v Ray White Waterford [2020] QCATA 113 at [23]. The mere fact that the Second Termination Notice was issued after the applicant had indicated that he would be taking legal action against the respondent does not necessarily mean that the respondent was wholly or partly motivated to give the termination notice for this reason. As I have already said, the respondent had formed the intention to give a termination notice in August 2021. That pre-dated any statements made by the applicant during the first proceeding in the Tribunal in December 2021. 5. For the above reasons, I am not satisfied that that the Second Termination Notice was a retaliatory notice in the relevant sense for the purposes of sub-ss 115 (1) and 115(2) of the RTA. 6. Even if I were satisfied that the Second Termination Notice was a retaliatory notice in the requisite sense, I would not exercise the discretion conferred by s 115(1) to declare that it has no effect. 7. The discretion granted by s 115 is expressed in general terms: Howard v B Miles Womens Foundation Inc [2012] NSWSC 1173 at [23]. The use of the word "may" in s 115(1) indicates that the section is permissive, not mandatory: Nulla Nulla Aboriginal Land Council v Lucas [2013] NSWCTTT 219 at [51]. 8. As I have already pointed out, the residential tenancy premises are a granny flat which is attached to the main premises on the property in which the respondent resides. That means that the applicant and respondent are living in close proximity to each other. To say that the relationship between the applicant and the respondent is a troubled one is likely to be an under-statement. Each has reported the conduct of the other to the police. The applicant has corresponded with the respondent's property manager in grossly discourteous terms. I have also set out above the findings which I have made of physical assaults by the applicant against the respondent and his dog. 9. The evidence indicates that the on-going relation between the applicant and respondent is placing both parties under emotional stress and is also likely to be having this impact on the respondent's son who lives with him. 10. In the circumstances, if the respondent is otherwise entitled to terminate the residential tenancy agreement, I do not consider that it would be appropriate to exercise the discretion under s 115(1) of the RTA in favour of the applicant even if, contrary to my decision, the discretion was available to be exercised. To do so would have the effect of keeping the parties in a relationship which has been acrimonious and has involved physical assaults by the applicant on the respondent and the respondent's dog. The Section 44 Application 1. The applicant seeks an order that the proposed rent increase from $300 to $450 per week is excessive. 2. Section 44(5) specifies a non-exhaustive list of factors which the Tribunal may have regard to in determining whether a rent increase is excessive. I have considered the factors listed in s 44(5) as follows: 1. As to s 44(5)(a), I have already noted the limitations in the applicant's evidence as to the general levels of rent for comparable premises. I do, however, note that the range of rent for the premises referred to in the applicant's evidence is from $260 per week to $350 per week. I also note that the subject residential premises allow for access to a large outdoor verandah area and outdoor area. That does not appear to be a feature of some of the rental premises included in the applicant's evidence. This feature would warrant placing the subject rental premises at the upper end of the rental range contained in the applicant's evidence. 2. As to s 44(5)(b), under clause 10.3 of the rental tenancy agreement, the respondent is to pay all charges for the supply of electricity to the premises. The respondent gave evidence that the applicant conducts an on-line business form the premises. He says that this has increased the electricity charges because of the applicant's internet and lighting usage. The respondent gave evidence that the electricity charges have increased by $650 per quarter while the applicant has been in occupation of the premises. I generally accept the respondent's evidence in this respect. 3. There was no specific evidence in relation to the factors identified in s 44(5)(c). 4. As to s 44(5)(d), there was no specific evidence in relation to the state of repair of the residential premises. I shall assume that the premises are in a good state of repair as there is no evidence to indicate otherwise. 5. As to s 44(5)(e), the respondent has allowed the applicant to install a dish for Foxtel reception and has also allowed the applicant and the applicant's dog to make use of the outdoor area. 6. As to s 44(5)(f), there is no evidence to indicate that work has been done to the premises by or on behalf of the applicant. 7. As to s 44(5)(g), the last rent increase was in August 2021 when the rent was increased from $280 to $300 per week. 8. As to s 44(5)(h), no other matters appear to have been submitted by the parties as being relevant and I unable to discern any other relevant matters. 1. In Baltov v Casaceli [2021] NSWCATCD 91 at [15], the Tribunal said: The discretionary matters which the Tribunal is 'to have regard to' are set out in RTA s 44(5). Not all these factors are required to be considered and the weight to be attached to each is a matter for the Tribunal in the circumstances of each case; there is a wide discretion to be exercised judicially but without a requirement to adopt any particular method of determining the fair rent. The RTA does no more than provide a list of matters for consideration, and leaves it to the Tribunal to determine whether any or any particular weight should be given. 1. I shall adopt the approach set out by the Tribunal in Baltov v Casaceli. 2. Even if the Tribunal finds that the rent proposed by the landlord is excessive, it may nonetheless order a rent increase in a lower amount if it considers that is justified by the evidence. So much is clear from the power given to the Tribunal under s 44(1)(a) to order that rent "must not exceed a specified amount". 3. There are a number of factors in the present circumstances which justify a rent increase. These are: the excessive electricity usage by the applicant; the good state of repair of the premises; the generally favourable level of amenities provided to the applicant by the premises (eg, the installation of the Foxtel dish, the use of the verandah and the use of the outdoor area); and the fact that the current rent is at the mid-point of the rent range of $260 to $350 per week for comparable premises. 4. However, having regard to the whole of the evidence, I am not satisfied that the rent increase proposed by the respondent is justified. I consider that a rent increase of $50 per week is appropriate taking the rent to $350 per week from 13 April 2022 which is the date on which the landlord proposed the rent increase take effect. Orders 1. For the above reasons the Application in RT22/04850 is dismissed. In Application RT22/09776, there will be an order that the rent shall not exceed $350 per week from 13 April 2022 to 13 April 2023. ********** I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales. Registrar DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 26 August 2022