Civil and Administrative Tribunal New South Wales Medium Neutral Citation: Kevin Miller & Michelle Miller v Ken Buck & Leonie Buck [2014] NSWCATCD 159 Hearing dates: 1 April 2014; 11 June 2014 Decision date: 25 August 2014 Jurisdiction: Consumer and Commercial Division Before: J Lennard, General Member Decision: 1 The landlords are to pay the tenants the sum of $7,010.00 as compensation for failure to repair premises and a refund of rent overpaid from one April 2014 to 11 June 2014. 2 The landlords are to undertake the following work in a proper and workmanlike manner: - (a) repair of the dam wall and drainage work in areas surrounding the damp by 25 June 2014. (b) grade for the driveway to enable access to premises by tenants and delivery vehicles by 9 July 2014. (c) repair to roof gutters and downpipes to ensure that there are no leaks into the premises or over the front door and to ensure the rainwater is properly inadequately directed to the rainwater state storage tanks by 9 July 2014. (d) undertake all repairs is necessary to restore the premises to a reasonable state of repair and to ensure that the premises are secure and safe - by 15 August 2014. 3 Having regard to the reduction by the landlord of facilities in relation to water storage accessible driveway the use of the deck and sunroom, the use of the bathroom and kitchen the rent is reduced to $175.00 per week from one April 2014 to 15 August 2014. Catchwords: LANDLORD - failure to repair - compensation - rent reduction - orders to repair Legislation Cited: Civil and Administrative Tribunal Act 2013 (NSW) Residential Tenancies Act 2010 (NSW) Cases Cited: Northern Sandblasting P/L v Harris (1997) 188 CLR 313 Smith v Residential Tenancies Tribunal [2002] NSWSC 518 Texts Cited: Anforth, Christensen and Taylor, Residential Tenancies Law and Practice New South Wales, Federation press 2011. Category: Principal judgment Parties: Kevin Miller and Michelle Miller (applicants) Ken Buck and Leonie Back (respondents File Number(s): RT 14/ 14711 Publication restriction: Unrestricted reasons for decision APPLICATION 1The applicants as tenants entered the respondent as landlords entered into a residential tenancy agreement on 9 February 2012. The term of the agreement was for a fixed term of 12 months ending 10 February 2013; the agreement continues as a periodic tenancy. 2On 28 February 2014 the tenants made an application to the Tribunal pursuant to section 190 of the Residential Tenancies Act 2010 (the Act) for an order in relation to a breach of the residential tenancy agreement by the landlords. The applicant sought the following orders: (1)an order for compensation for the failure to repair pursuant to section 187 (1) (d) of the Act; (2)an order that the rent payable is excessive due to the reduction withdrawal of services and facilities provided with the residential premises, based on a failure to repair pursuant to section 44 (1) (b) of the Act; (3)an order that the landlords carry out repairs pursuant to section 65 (1) (a) of the Act; and (4)an order pursuant to section 187 (1) (a) restraining any action in breach of the residential tenancy agreement. JURISDICTION 3Clause 18.3 of the Residential Tenancy Agreement provides that the landlord agrees to keep the premises in a reasonable state of repair. 4Section 65 of the Act provides that the Tribunal may, on application by the tenant, make an order that the landlord carry out specified repairs. The Tribunal may make such an order only if it determines that the landlord has breached the obligation under this Act to maintain the residential premises in a reasonable state of repair. The Tribunal not must not make such an order unless the Tribunal is satisfied that the landlord has notice of the need for repair or ought reasonably to have known of the need for repair and the landlord failed to act with due diligence to have the repairs carried out. 5Section 44 of the Act provides that the Tribunal may make an order that rent payable under a 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. In making a determination that the rent is excessive the Tribunal may have regard to, inter alia, the state of repair of the premises. 6Section 187 of the Act provides that the Tribunal may on application by a tenant make an order that requires an action in performance of a residential tenancy agreement, an order for the payment of an amount of money and an order as to compensation. ISSUES 7The Tribunal has to determine whether as a matter of fact the landlords failed to provide and maintain the residential premises in a reasonable state of repair, and having regard to the age of, rent payable for and the prospective life of the premises. 8Section 63 of the Act provides that a landlord must provide and maintain the premises in a reasonable state of repair and that the landlord's obligation to maintain the premises in a reasonable state of repair applies even though the tenant had notice of the state of disrepair before entering into occupation of the premises. 9The obligation to repair is broad. The tenant is under an obligation to inform the landlord of the need for repair. The landlord will be in breach of the residential tenancy agreement if they do not, once notified of the need for repair and/or maintenance of the premises, act with reasonable diligence to have the repairs carried out [s 65(3) (a) Residential Tenancy Act]. See also Northern Sandblasting P/L v Harris (1997) 188 CLR 313. 10The landlord's obligation is to maintain the premises in a reasonable state of repair, having regard to the factors set out in section 63. The concept of a reasonable state of repair does not go only to safety but also to whether the premises are in a state of repair commensurate with the parties' tenancy agreement. Thus a failure by the landlord to repair defective services and facilities in the premises is a failure to maintain the premises in a reasonable state of repair. See Smith v Residential Tenancies Tribunal [2002] NSWSC 518 as discussed in Anforth, Christensen and Taylor, Residential Tenancies Law and Practice New South Wales, Federation press 2011. 11The obligation to maintain the premises in a reasonable state of repair is a contractual one and does not depend upon the landlord's circumstances, for example, financial problems. The word reasonable deals with the state of repair having regard to the rent age and life expectancy of the premises. 12The Tribunal has to determine whether the application by the tenant is made within the prescribed period of three months from the date of the breach. 13Section 190 of the Act provides that a landlord or a tenant may apply to the Tribunal for an order in relation to a breach of a residential tenancy agreement within the period prescribed by the regulations after the landlord or tenant becomes aware of the breach or within such other period as may be prescribed by the regulations. Regulation 22 (9) provides that the prescribed period for making an application for an order in relation to a breach of a residential tenancy agreement is within three months after the applicant becomes aware of the breach. SUBMISSIONS 14The applicant tenant provided details written submissions and documentary evidence in relation to the need for repair and maintenance of the premises, the steps taken by the tenant to inform the landlords of the need for the various repairs, the failure by the landlords to complete the repairs, the additional costs incurred by the tenants as a result of the landlords' failure to repair failure to repair and the removal of services and facilities. The tenants application asked for compensation in the amount of $14,895.00. 15The tenant provided copies of a letter dated 25 July 2012 to the landlords. Referred to previous requests for repairs dating from February 2012 and attached a three-page list of 30 items of requested repairs. This list included but was not limited to leaking gutters roof and windows, leaking shower, floor tiles in carpets lifting, ceilings and kitchen cupboard panels falling off, the state of the driveway, the state of the gates, the lack of appropriate drainage in the area of the back yard, behind the garage and overflow and flooding from the dam and leaks and water tanks. 16The Tribunal had before it written correspondence between the tenant representative and Landmark property managers in February 2014 in which 37 items of requested repairs were listed. It is noted that the majority of the repairs requested in July 2012 were also requested in February 2014. 17The tenant provided photographs as follows: (1)the driveway which is in a poor state of repair and with some minor flooding; (2)the leaking roof in the sun room; (3)the panels falling from the kitchen cupboards; (4)the bathroom cupboards and bathroom light in need of repair; (5)the pelmet which had fallen from above the sliding cavity doors; (6)sliding doors which have come out of their tracks; (7)a broken power point in the main bedroom; (8)severe cracking of the walls throughout the residential premises; (9)broken and dilapidated downpipes, eaves and guttering; (10)areas of flooding surrounding the damp; (11)interior of the garage, including electrical power boards and power cords running to the garage through guttering and near taps and across the open ground: (12)the non-operative roller door in the garage; (13)various fences and gates; and (14)the broken and raised decking to the residential premises. 18The photographs are evidence of premises which has not been maintained in a reasonable state of repair. 19The tenant provided evidence by way photographs and a medical certificate showing that the tenant had fallen in the bathroom due to the leaking shower and had received a black eye, that the tenant had scraped her arm on an ill-fitting lock in the bathroom and that the tenants' daughter had had to receive medical treatment for bruising and headaches as a result of the pelmet falling from the door and onto her head. 20The tenants gave uncontested evidence that they had been requesting repairs to the premises from February 2012 with repeated requests including request in writing in July 2012 and request in writing in February 2014. In addition the landlord and the landlord agent had attended the property and on each occasion have been made aware of the need for maintenance. 21The landlord provided evidence that some repair work had been undertaken in relation to the replacement of downpipe from a gutter to a tank in June 2012 providing keys and blocks for doors in within the premises in August 2012 repairs to the leaking shower and blocked toilet in July 2013 and replacing the power point in the bedroom in May 2014. 22The landlords' submissions state that the property is not a new home and attempts of been made to make the home as comfortable as possible for the tenants. The Tribunal accepts that the premises are not new. The landlords have a contractual obligation to maintain the premises in a reasonable state of repair: in this matter the state of the kitchen cupboards, the roof, the eaves, the gutters, the sunroof, the doors (including the lack of doors in some of the bedrooms as a result of removal by the landlord) the deck and the leaks in the showers has resulted in premises which are manifestly unsafe and which cannot be used in their entirety or with any reasonable degree of comfort. The landlord has failed, after being made aware of the need for repair and maintenance to act with reasonable diligence to have the necessary repairs and maintenance carried out. The landlord is in breach of his contractual obligation arising from the residential tenancy agreement to maintain the premises in a reasonable state of repair. 23A party who suffers damage as a result of a breach of contract by another party is entitled to an amount of damages which will, as far as possible, put the injured party in the same position they would have been in had the breach not occurred. That is, damages for breach of contract are compensatory. Robinson v Harman [1848] EngR 135; (1848) 1 Exch 850. The innocent party must establish that the loss complained of was caused by the breach of contract and that the loss was not too remote from the breach. The rule in Hadley v Baxendale (1854) 9 Exch 341 is applied to determine which loss is recoverable. 24The submissions by the tenants referred the Tribunal to the cases and the table of comparative verdicts set out in Anforth, Christensen and Taylor, Residential Tenancies Law and Practice New South Wales, Federation Press 2011. The Tribunal examined each of the breaches by the landlord and based upon the Tribunal's experience and after taking into account table of comparative verdicts, the Tribunal determined that the tenants were entitled to compensation in the amount of $5,260.00. 25The Tribunal then made orders that the landlord remedy the breach by undertaking the following work in a proper and workmanlike manner: (1)to repair the dam wall and drainage work in the area surrounding the damp house and garage to ensure that no water flows from the dam to the backyard under the house into the garage by 25 June 2014; (2)grade grading and filling of the driveway to enable access to the premises by tenants and delivery vehicles by 9 July 2014; (3)repairs to roof, gutters and downpipes to ensure that there are no leaks into the premises or over the front door and to ensure that the rainwater is properly inadequately directed to the water storage tanks by 9 July 2014; new line all repairs as are necessary to restore the premises to a reasonable state of repair and to ensure that the premises are secure and safe by 15 August 2014. The repairs included but were not limited to: (a)kitchen cupboards and kickboard; (b)bathroom including repair of the tested heater/fan; (c)making the sunroom waterproof, and properly fixing the walls and clothing; (d)repairing the deck; (e)replacing and/or repairing the doors to the bedrooms; (f)repairing the garage door and providing adequate date drainage around and in the garage to avoid flooding of the floor. 26After considering the evidence before it the Tribunal determined that as a direct result of the breach of the contractual obligation to maintain the premises in a reasonable state of repair the tenants suffered a severe reduction in relation to the following facilities: (1)Water storage facilities. Rainwater was not being collected into the rainwater tanks as a result of the failure to maintain the roof the gutters and downpipes. (2)The front deck was unable to be used. The deck was damaged by water, was cracked and some of the boards have come loose. (3)The sunroom was not able to be used. The roof was leaking, the cladding was coming off the internal walls and the window surround was severely damaged by water seepage. (4)Full functional use of the bathroom and kitchen in the premises. The bathroom and kitchen cupboards are in a very poor state of repair hinges required refitting kickboards required reading securing. 27The Tribunal noted the three month time limit set out in the regulations for the bringing of an application in relation to a breach of a residential tenancy agreement and determined that it was appropriate to reduce the rent by 50% for the period from 1 April 2014 until the repairs are completed in accordance with the Tribunal's timetable by 15 August 2014. The Tribunal therefore ordered a refund of the amount of $1750 being over rent overpaid from one April 2014 to 11 June 2014. J Lennard General Member Civil and Administrative Tribunal of New South Wales 25 August 2014 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 Amendments 02 December 2014 - corrected paragraph numbering Amended paragraphs: 27 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: 02 December 2014