Civil and Administrative Tribunal New South Wales Medium Neutral Citation: Abdel-Messih v Dai [2017] NSWCATAP 20 Hearing dates: 23 January 2017 Date of orders: 01 February 2017 Decision date: 01 February 2017 Jurisdiction: Appeal Panel Before: S Westgarth, Deputy President D Fairlie, Senior Member Decision: (1) The appeal is adjourned part-heard and will be listed for directions by the Registry after 28 days for the appointment of a further hearing date; (2) Within 14 days from 23 January 2017, the respondent will file with the Tribunal and serve on the appellant his evidence and submissions in support of his argument that the respondent has reached an agreement with the appellant about all aspects of the appeal (other than the claim concerning the submission of the appellant to be able to enter into subtenancies); (3) Within 14 days after the period identified in order 2 above, the appellant is to file and serve his evidence and submissions in reply to those provided by the respondent; and (4) The Appeal Panel reserves its decision concerning the subtenancy issue but has indicated to the parties that the Appeal Panel proposes to find that in respect of those issues the appeal should be dismissed. Catchwords: Subtenancies under the Residential Tenancies Act Legislation Cited: Civil and Administrative Tribunal Act 2013 Residential Tenancies Act, 2010 Category: Principal judgment Parties: Bishoy Abdel-Messih (Appellant) Xiao Dong Dai (Respondent) Representation: Ms Sarah Morris (real estate agent for Respondent) File Number(s): AP 16/47125 Publication restriction: Unrestricted Decision under appeal Court or tribunal: Civil and Administrative Tribunal Jurisdiction: Consumer and Commercial Division Citation: Not applicable Date of Decision: 10 October 2016 Before: D Charles, General Member File Number(s): RT 16/25202 reasons for decision Background 1. This is an appeal from a decision made in the Consumer and Commercial Division of the Tribunal on 10 October 2016. The appellant was the applicant in the first instance proceedings and the respondent was the applicant's landlord. The parties had entered into a residential tenancy agreement. We will refer to the appellant as the tenant and to the respondent as the landlord. 2. As the decision which is the subject of this appeal (the Decision) makes clear, the tenant seeks compensation in an amount of up to $15,000.00 and a specific performance order that the landlord take reasonable steps to ensure the tenant's quiet enjoyment of the premises. The application for a specific performance order is now redundant as the tenancy has come to an end. The tenant seeks compensation by reason of the alleged breach of the tenant's right to quiet enjoyment in that the tenant (who had entered into residential tenancy agreements with subtenants) experienced difficulties in providing access to the building in which the residential premises were located to the subtenants. In particular, the tenant alleged that the manager of the building (or its employees) asserted to subtenants that the tenant did not have authority to enter into subtenancies. 3. In the Decision the Tribunal found that the tenant did not have such a right to enter into the subtenancies. The tenant appeals that decision. 4. The Decision also concerned the claim by the tenant for compensation in respect of the following matters: 1. The allegation by the tenant that the landlord interfered in the tenant's internet access and usage. Compensation is sought in respect of that alleged breach; 2. Compensation is sought by tenant in respect of an allegation that the subject premises were infested by cockroaches and that the tenant was required to spend money on pest treatment; 3. Compensation was sought by the tenant in respect of an alleged breach by the landlord to repair and maintain the premises. The particulars concerning this allegation are that the dryer in the premises did not function properly. There was also an allegation concerning showerheads; and 4. The Decision found that the tenant was entitled to compensation in the sum of $250.00 (made up of $150.00 rent reduction because of the defective dryer and $100.00 for return of a security card fee). Notice of Appeal 1. A Notice of Appeal was filed on 25 October 2016. The tenant stated he had received the Decision on 12 October 2016. Accordingly, the Notice of Appeal was filed within time. The grounds of appeal may be summarised as follows: 1. Decision not fair and equitable. The Notice of Appeal states that the Member does not "act objectively towards me". The tenant stated there were other decisions made by the Member in "flawed judgments". The Notice of Appeal stated that the Member had placed substantial weight on statutory declarations from persons who were not present for cross examination. Some matters were resolved against the tenant on the basis of a verbal denial by the respondent; and 1. The Decision was against the weight of evidence. 1. The tenant's right to appeal lies in the provisions of the Civil and Administrative Tribunal Act 2013 (NCAT Act): see s 80 and Sch 4 Cl 12. The Hearing 1. At the hearing, there was an application made by the landlord's agent, Ms Morris for an adjournment of the hearing. The basis for the application was that her company, Belle Property had only recently been appointed the managing agents of the subject premises. That occurred on 24 December 2016 and, as a consequence, they have been unable to prepare for this hearing or to file submissions on behalf of the landlord. Directions had been made in November last for the parties to file and serve their evidence and submissions. The tenant has complied and the landlord was due to file and serve theirs by 13 January 2017. That has not occurred. 2. We rejected the application for the adjournment and proceeded to hear the appeal. Reasons were given orally. The basis for the rejection was that there was no explanation given by the landlord to explain why the landlord himself had not dealt with his responsibility to prepare, file and serve submissions by 13 January 2017. The landlord's son, Mr Benjamin Dai was present at the hearing and was also present at the directions hearing. There was no explanation as to why the landlord, his son or the former managing agents could not have commenced the preparation of necessary evidence and submissions. Accordingly, we thought it appropriate to continue with the appeal. 3. However, at the conclusion of the tenant's case, Mr Benjamin Dai made the submission that all of the matters the subject of the appeal (other than the matter concerning compensation for interference with subtenancies) had been the subject of an agreement between the parties at separate Tribunal hearings which occurred in December 2016. However Mr Dai did not have any evidence in support of that contention. The tenant' was asked to indicate his view on what Mr Dai had submitted. The tenant's reply was equivocal and unclear but he did indicate that he did not agree with Mr Dai. By this time, there was no time or insufficient time left to hear Mr Dai's submissions in further detail. Accordingly, the hearing was adjourned and directions were made as described below. 4. We indicated to the parties that we did not accept the tenant's submissions concerning the subtenancy issue and therefore there was no need to hear from the landlord's representatives on that issue. 5. In these circumstances we made the following directions: 1. The appeal is adjourned part-heard and will be listed for directions by the Registry after 28 days for the appointment of a further hearing date; 2. Within 14 days from today, the respondent will file with the Tribunal and serve on the appellant his evidence and submissions in support of his argument that the respondent has reached an agreement with the appellant about all aspects of the appeal (other than the claim concerning the submission of the appellant to be able to enter into subtenancies); 3. Within 14 days after the period identified in order 2 above, the appellant is to file and serve his evidence and submissions in reply to those provided by the respondent; and 4. The Appeal Panel reserves its decision concerning the subtenancy issue but has indicated to the parties that the Appeal Panel proposes to find that in respect of those issues the appeal should be dismissed. 1. Having indicated to the parties our views on the subtenancy issue, we thought it appropriate to publish our reasons. Accordingly, this decision concerns only the claim by the tenant for compensation by reason of the alleged difficulties concerning the subtenancies. Tenant's Submissions 1. The tenant's submissions did not include a complete copy of the residential tenancy agreement which was the subject of the Decision. However, at the hearing we located a copy of that agreement which both the tenant and the landlord's representative agreed was an accurate copy of the relevant residential tenancy agreement. It contains the following provisions relevant to the subtenancy issue: 32. The Landlord and tenant agree that: 32.1 the tenant may, with the landlord's written permission, transfer the tenant's tenancy under this agreement or sub-let the residential premises, and 32.2 the landlord may refuse permission (whether or not it is reasonable to do so) to the transfer of the whole of the tenancy or sub-letting the whole of the residential premises, and 32.3 the landlord must not unreasonably refuse permission to a transfer of part of a tenancy or a sub-letting of part of the residential premises, and 32.4 without limiting clause 32.3, the landlord may refuse permission to a transfer of part of the tenancy or to sub-letting part of the residential premises if the number of occupants would be more than is permitted under this agreement or any proposed tenant or sub-tenant is listed on a residential tenancy database or it would result in overcrowding of the residential premises. 1. In addition, ss 74 and 75 of the Residential Tenancies Act, 2010 (RT Act) are relevant. Section 74 provides that the tenant may transfer the tenancy to another person or sublet the premises to another person, if the landlord gives written consent to the transfer or subletting. Section 74(3) provides that this section is a term of every residential tenancy agreement. 2. Section 75 provides that the landlord may withhold consent to a transfer or subletting to the whole tenancy or residential premises whether or not it is reasonable to do so. Section 75(2) provides that the landlord must not unreasonably withhold consent to a transfer of the tenancy or subletting of premises if the transfer results only in one or more tenants in addition to an original tenant under the residential tenancy agreement or the partial subletting of the residential premises occupied by the tenant. Section 75(3) sets out circumstances in which the landlord is entitled to withhold consent. The landlord did not submit that any of the circumstances set out in s 75(3) were relevant to this dispute. 3. In addition to the provisions of the residential tenancy agreement, the tenant submitted that two other provisions were incorporated into the agreement between the parties namely: 1. An undated letter from Conrad Realty (the former agent for the landlord) which stated the following: This letter is given to Mr Bishoy Abdel-Messih, tenant of XX Liverpool Street Sydney, allowing him to sublet the apartment with our permission and provided he adheres to both tenancy and strata regulations 1. Special bylaws 20.5, 20.6 and 20.7 of the bylaws applicable to the strata scheme in which the residential premises were located, which provide that where an owner or existing occupier leases a lot, the owner of a lot must forward to the Owners Corporation information relating to the occupier. The nature of the information is set out in the clause. 1. The tenant's submission was that the Conrad Realty letter (set out above) was provided to him at the time he entered into the residential tenancy agreement and that the effect of that letter is that he was entitled to sublet to subtenants without the need for any further consent to be obtained from the landlord. 2. In the Decision the Tribunal did not accept the tenant's position with respect to the Conrad Realty letter. The Tribunal stated that it was unable to accept that letter as evidence of the landlord's prior consent to subletting. The Tribunal stated that the letter provided no names of individual subtenants. Such information was a necessary requirement of condition 32 (set out above) and of special bylaw 20 (also set out above). Decision 1. We agree with the conclusion of the Tribunal and would also add that we do not think that the Conrad Realty letter constitutes a general approval for the tenant to enter into subtenancies without the need for subsequent referral back to the landlord as contemplated by the provisions of special condition 32 and ss 74 and 75 of the RT Act. The Conrad Realty letter states that the landlord will allow the tenant to sublet "provided he adheres to both tenancy and strata regulations". In our view this proviso recorded the fact that the landlord still required the tenant to comply with the provisions of special condition 32 and the RT Act. In essence, this means that the obligation still rested with the tenant to seek the landlord's approval. One of the submissions raised by the tenant was that an interpretation of this kind would leave the tenant "at mercy of the landlord every time they wished someone to move in". In our view that is an exaggeration as the provisions of the RT Act and special condition 32 impose limits on the landlord's ability to refuse consent. 2. The tenant raised a submission concerning a subtenant, Mr Mountford. The tenant submitted that the landlord had given consent for him to enter into a subtenancy with Mr Mountford but that the landlord's agent had subsequently denied Mr Mountford access. The tenant provided no evidence to us to verify the assertion that the landlord had given consent to Mr Mountford and, in particular, there was no evidence that evidence of that kind was before the Member who delivered the Decision. During the hearing the tenant conceded that the evidence concerning Mr Mountford's tenancy was not before that Member. 3. Accordingly, we are of the opinion that the contentions made by the tenant should be rejected and our consideration of the appeal should be limited to the evidence and submissions which were before the Member at first instance. 4. We note that the landlord contends that the Conrad Realty letter does not form part of the residential tenancy agreement. In view of our interpretation of the effect of that letter, we do not have to decide whether the letter forms part of the residential tenancy agreement. 5. It is our view that the Decision in respect of the subtenancy issue should be affirmed. We will not enter orders at this stage as the proceedings are part heard with the remaining part concerning compensation claims brought by the tenant. Orders will be made at the conclusion of the hearing. 6. Directions have already been made concerning the future conduct of this appeal: see par 11. ********** 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: 01 February 2017