New South Wales Supreme Court CITATION : Metropolitan Local Aboriginal Land Council v Coe & Anor [2000] NSWSC 786 CURRENT JURISDICTION: Common Law Administrative Law List FILE NUMBER(S) : SC 30010 of 2000 HEARING DATE(S) : 7 August 2000 JUDGMENT DATE : 9 August 2000 Metropolitan Local Aboriginal Land Council (Plaintiff) PARTIES : v June Coe (First Defendant) Residential Tenancies Tribunal (Second Defendant) JUDGMENT OF : Master Malpass LOWER COURT Residential Tenancies Tribunal JURISDICTION : LOWER COURT 00/01467 FILE NUMBER(S) : LOWER COURT Mr R Connolly JUDICIAL OFFICER : Mr D H Murr SC (Plaintiff) COUNSEL : Mr Michael Wright (First Defendant) N/A (Second Defendant) Woolf Associates (Plaintiff) SOLICITORS : Horowitz & Bilinsky (First Defendant) I V Knight - Crown Solicitor - Submitting appearance (Second Defendant) CATCHWORDS : Appeal - on a question in respect of a matter of law - arrears of rent and appropriation of payments. LEGISLATION CITED : Marriage Act 1928 (Vict). Residential Tenancies Act 1987, s 45, s 57, s 62. CASES CITED : Briginshaw v Briginshaw & Anor 60 CLR 336. DECISION : See paragraphs 20-22. THE SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION ADMINISTRATIVE LAW LIST MASTER MALPASS WEDNESDAY 9 AUGUST 2000 30010 OF 2000 METROPOLITAN LOCAL ABORIGINAL LAND COUNCIL v RESIDENTIAL TENANCIES TRIBUNAL JUDGMENT 1 The plaintiff is the owner of premises known as 31 Agar Street, Marrickville. The defendant has occupied those premises as a tenant. 2 There was default under the original Residential Tenancy Agreement. In 1997, she was in arrears of rent in the order of $5,500. The plaintiff brought proceedings in The Residential Tenancies Tribunal. An order was made that the defendant pay the sum of $150 per week (being rent $100 and $50 to discharge arrears) to the plaintiff. 3 As the arrears remained largely outstanding, in November 1998 the matter once more came before the Tribunal. An agreement was reached as to the amount of arrears ($5,000) and by consent orders were made that $150 per week (being rent $100 and $50 to discharge arrears) be paid. The parties also agreed to enter into a new Residential Tenancy Agreement. It was made on 13 November 1998. Provision was made for rent to be paid at the rate of $100 per week, payable every week, two weeks in advance. 4 On 21 July 1999, a Notice of Termination was given. It was given pursuant to s 57 of the Residential Tenancies Act 1987. It was given inter alia on the ground of non-payment of rent under the new agreement. The subject notice is of no effect unless the rent has been unpaid for 14 days or more prior to giving of the notice. 5 A further application was made to the Tribunal. It came before the Tribunal on 27 September 1999. Agreement was reached as to an indebtedness (in the sum of $3,600 up to 17 September 1999) and that it be paid by 8 November 1999. Consent orders, which gave effect to the agreement, were made. 6 As payment was not made, the application was re-listed before the Tribunal. The defendant did not appear. An order was made for possession. 7 The defendant applied for a re-hearing. This took place on 21 January 2000. The notice was found to be invalid (the Tribunal was not satisfied that the breaches alleged therein had been proved). The application was dismissed by the Tribunal. 8 These proceedings were commenced by Summons filed on 18 February 2000. The plaintiff brings an appeal against the decision of the Tribunal. The appeal is restricted to a question in respect to a matter of law (s 62). 9 The appeal was heard on 7 August 2000. The plaintiff relied on two affidavits sworn by Mr Woolf (the solicitor for the plaintiff). The defendant relied on an affidavit sworn by Mr Docker (the solicitor for the defendant). The affidavits contain inter alia competing versions of a discussion had with the Tribunal Member (R Connolly) prior to the hearing. It is common ground that it is not necessary to resolve that conflict. There is also some correspondence subsequent to the determination. It is also common ground that this correspondence is not relevant to the matters in issue in the appeal. 10 Both the plaintiff and the first defendant were represented by counsel. The second defendant filed a submitting appearance and did not appear at the hearing. 11 Counsel have prepared written submissions. These submissions were supplemented by oral argument. The real issue is whether or not the plaintiff was able to demonstrate an error of law on the part of the Tribunal. There was reference to the long line of authority for the view that no amount of perversity or unreasonableness will elevate a decision on a question of fact to one manifesting an error of law. 12 The principal issue agitated before the Tribunal was whether or not the defendant was in arrears of rent for more than 14 days when the notice was given. Largely, the evidence of payment consisted of the tenant's ledger. This showed payments generally in either a sum of $150 or multiples thereof. There were a few payments in multiples of $100. The ledger demonstrated an appropriation of the payments to the earlier debts. It had been served on the defendant. The defendant did not give any evidence. 13 Although the term "appropriation" does not seem to have been used, arguments to that effect were put by the parties. Generally speaking, the plaintiff argued that payments were applied to satisfy both rent and arrears. The defendant argued that they were applied in payment of rent only. 14 The Tribunal has produced written reasons for the determination (pursuant to s 45). 15 For present purposes, the material passages in the reasons appear under the headings "Rent Arrears" and "Findings". There was reference to the two bases upon which the case for arrears had been advanced. Basis 1 was founded on an appropriation to the oldest debts. Basis 2 was founded on the premise that payments made since the new agreement were made in respect of both rent and arrears (an appropriation of $50 per week towards arrears). 16 The written reasons contain inter alia under the heading of "Findings":- "The Tribunal rejected out of hand the first of the bases put by the landlord. It is difficult to contemplate a tenancy agreement that would be more prejudicial to a tenant than one which on the second week of the tenancy ie. 20 November 1998, allocates a 'date paid to' in relation to rent, of 9 December 1997, and a debt of $5,028.57 in unpaid arrears (see Schedule 1). On the basis of that document the tenant would commence the tenancy near enough to 11 months in arrears and open to service a Notice of Termination on the basis of rent arrears on the first day of the tenancy agreement. The Tribunal rejects the second proposition by the landlord because it cannot be satisfied on the evidence before it that the landlord has made its case out on the balance of probabilities." 17 These paragraphs are followed by an erroneous reference to and use of what was said in Briginshaw v Briginshaw & Anor 60 CLR 336 (it is referred to as being " Briggenshaw -v- Briggenshaw "). This is an old authority on the question of the standard of proof on a petition for divorce on the ground of adultery under the Marriage Act 1928 (Vict). Certain observations (inter alia as to the standard of proof varying with the seriousness or importance of the issue and as to the need for reasonable satisfaction) appearing in the judgment in that case were cited. Although the Tribunal employed the words "balance of probabilities" in its reasons, it seems that regard was had to the content of the cited observations. 18 Be that as it may, I return to the matters which were relied on by the plaintiff. 19 In my view, the approach taken in rejecting basis 1 was erroneous. It gives rise to error on a matter of law. There was a clear misdirection. It lead to a rejection out of hand of basis 1. I have some difficulty with the precise reasoning process that led to this finding. However, it seems to have involved a misconceived view as to what was seen as a prejudicial effect of the agreement. There has been misapprehension as to both the agreement itself and relevant principle. Without seeking to be exhaustive, I shall mention certain matters. The agreement imposed an obligation to pay rent for the term of 26 weeks commencing on 13 November 1998 (not arrears). The source for the obligations to pay arrears outstanding at the time of the entering into the agreement lay elsewhere. The failure to pay those arrears did not constitute default under the agreement. 20 In the circumstances, I am satisfied that the plaintiff has demonstrated an entitlement to relief. Accordingly, I do not affirm the decision of the Tribunal. On the contrary, I order that the decision of the Tribunal dismissing the application be set aside. 21 There is dispute between the parties as to what should now be done in these circumstances. In my view, the appropriate course is to remit this decision to the Tribunal and order a re-hearing of the proceedings and I so order. 22 The first defendant is to pay the costs of the proceedings. ********** Last Modified: 09/27/2000 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.