Civil and Administrative Tribunal New South Wales Medium Neutral Citation: Shpak v Sarakiniotis [2018] NSWCATAP 36 Hearing dates: 7 November 2017 Date of orders: 02 February 2018 Decision date: 02 February 2018 Jurisdiction: Appeal Panel Before: M Harrowell, Principal Member J Currie, Senior Member Decision: 1. The appeal is allowed in part. 2. The decision to dismiss the claim for compensation and an order for rent reduction in connection with items of claim 5.1- 5.7 recorded in paragraph 5 of the reasons dated 8 September 2017 is set aside. 3. The proceedings are remitted to the Tribunal to determine, in accordance with law, the appellants' claims for compensation and/ or rent reduction in applications RT 17/29667 and RT 17/34045 in respect of items 5.1- 5.7 only, being those items recorded in paragraph 5 of the reasons dated 8 September 2017. 4. Unless the Deputy President or Principal Member/ List Manager otherwise determine, the remitted proceedings are to be determined by the Tribunal as originally constituted on 8 September 2017. 5. Unless the Tribunal otherwise orders, the hearing of the remitted proceedings is to be determined on the evidence originally filed by the parties and any oral evidence at the hearing on 8 September 2017. 6. Nothing in these orders otherwise prevents the Tribunal from making such directions as it considers appropriate for the just, quick and cheap resolution of the real issues in dispute. 7. Save as provided above, the appeal is dismissed. Catchwords: Residential Tenancies Act- order to carry out work, power to make conditional orders and ancillary orders, access to premises. Adequacy of reasons- compensation and rent reduction claims, no findings of fact. Remedies- discretion to award, entitlement where breach and loss established. Legislation Cited: Civil and Administrative Tribunal Act 2013 (NSW) Civil and Administrative Tribunal Rules 2014 (NSW) Residential Tenancies Act 2010 (NSW) Cases Cited: Beale v Government Insurance Office of New South Wales (1997) 48 NSWLR 430 Collins v Urban [2014] NSWCATAP 17 Corcoran v Far [2018] NSWCATAP 13 Worrall v Commissioner for Housing of ACT [2002] FCAFC 127 Texts Cited: Macquarie Dictionary, Revised Third Edition Words and Phrases Judicially defined, Roland Burrows KC, Butterworths, 1946 Category: Principal judgment Parties: Appellants: Anton Shpak and Hanna Nasyrava Respondents: George Sarakiniotis and Carol Sarakiniotis Representation: Appellant: A Shpak for both appellants Respondent: M Pose (agent) Solicitors: Not applicable File Number(s): AP 17/40688 Publication restriction: Unrestricted Decision under appeal Court or tribunal: Civil and Administrative Tribunal of New South Wales Jurisdiction: Consumer and Commercial Division Citation: Not applicable Date of Decision: 08 September 2017 Before: S McDonald, Senior Member File Number(s): RT 17/29667 and RT 17/34045 reasons for decision Introduction 1. This appeal relates to two applications made by the appellants in connection with a residential tenancy agreement dated 11 May 2017 (agreement) relating to residential premises at Randwick (premises). 2. The appellants (tenants) were the tenants. The respondents (landlords) were the landlords. 3. The first application, RT 17/29667 was filed on 3 July 2017. That application sought the following orders under the Residential Tenancies Act 2010 (NSW) (RT Act): 1. s 65(1)(a): that the landlord carry out repairs. 2. s 44(1)(b): that the rent payable is excessive due to a reduction or withdrawal of goods or services; 3. s 187(1)(d): an order for compensation; 4. s 187(1)(b): a specific performance order; and 5. s 65(5): an order that rent be paid to the Tribunal pending the carrying out of repairs. 1. The second application, RT 17/34045, was filed on 3 August 2017. In that application the tenants sought an order for termination under s103 of the RT Act (which relates to termination for breach by a landlord). This application also sought orders under ss 44(1)(b) and s 187(1)(d). 2. Both applications were heard on 8 September 2017. On that day, the Tribunal made the following orders: 1. Provided that the tenant agree within 7 days to vacate the premises or only such time as is strictly necessary for the landlord and/or his tradesman to assess and repair the issues outlined in paragraphs 5.1-5.4 and 5.6-5.7 below, the landlord shall attend to and finalise those repairs as he considers appropriate within 28 days of today's date. 2. Should the tenant not agree to any times in which they will vacate the premises for this purpose or at all within the 7 day period, then the landlord will be relieved of any obligation to complete the repairs referred to in paragraph 1 above. 2. (sic) Otherwise, the application is dismissed. 1. The work to which the order for repairs in order 1 relate was the following: 5.1 the front door deadlock-it locks from the outside but not from the inside even with the key, and needs replacing; 5.2 the lock on the front screen door-it can be locked from the inside with the small latch, but not from the outside with a key as the key cannot be inserted; 5.3 the toilet does flush but does not flush satisfactorily or sufficiently and evacuate all waste; 5.4 the flick mixer on the kitchen sink has become loose; 5.6 the bathroom door does not close and it needs planing; 5.7 the cold tap on the bathroom basin is difficult to turn off and needs a new washer. 1. The tenants appeal this decision. Notice of Appeal and submissions 1. The tenants filed a notice of appeal on 21 September 2017. 2. The grounds of appeal can be summarised as follows: 1. The Tribunal erred in law by ordering the tenants to vacate the premises while repairs were undertaken, such order being made without power. 2. The Tribunal erred in law by failing to determine whether the landlords had breached their obligation of repair. The Tribunal was required to make findings if there was a breach and make an order for repairs. However, the Tribunal made an order for repair contingent on the tenants vacating the premises. 3. The Tribunal failed to provide adequate reasons. 4. The reasons provided contain "errors in fact and weight as well as other details to be reviewed and corrected". The Appeal Panel notes the list of complaints spanned some 10 pages. It is unnecessary to set out the whole of what was said in detail. 1. In addition, the tenants sought leave to appeal on the basis the decision was not fair and equitable or was against the weight of evidence. 2. In relation to why the decision was not fair and equitable, the tenants said that the way the matter was conducted and decided by the Tribunal denied them a chance to achieve a better outcome. These complaints included: 1. the Tribunal gave undue weight to the oral evidence of the landlords' agent, 2. the Tribunal failed to consider the evidence of inspections carried out by Mr Sarakiniotis who had already assessed matters requiring repair and had refused to undertake such repairs, 3. the Tribunal did not consider a proposal by the tenants to show video evidence. In this regard the Appeal Panel notes that the evidence related to locks, toilet, spa and tap issues which were the subject of the Tribunal's order for repairs. 4. The Tribunal failed to provide any reasons as to why the repair issues raised in 5.1-5.7 did not constitute adequate grounds for termination of the agreement; 5. The Tribunal noted there was a proposal by the landlords to terminate the agreement by consent. The tenants say this proposal was unfair because it did not take account of the fact that the tenants had "suffered physical inconvenience and threats to security" nor was there any "apologies or any compensation proposed" by the landlord. 6. The tenants were not provided an opportunity "to refer to the Chronology of Events and to all evidences in a structured manner." This resulted in the tenants being "deprived a chance to prove the breach of the RTA by landlord or that the repairs required should be performed by licensed persons without any additional "preliminary assessment" and without being ordered to vacate". 1. In relation to why the decision was against the weight of the evidence, the tenants referred to various evidence provided, or sought to be provided, and identified that material which they said should have been given more weight. This material consisted of oral evidence and written documents, many of the written documents being read out by the tenants at the hearing. 2. The landlords filed a Reply to Appeal on 27 September 2017. 3. The landlords said the decision was correct. In short, the landlords said that they had not breached the agreement. Further, the landlords said that when approached by the tenants to carry out repairs, they requested access to do so. In these circumstances, they said there was no reason to make an order to reduce the rent and if the tenants wished to terminate the agreement they could do so with no break fee. 4. The Appeal was listed for directions before the Appeal Panel on 28 September 2017. At that time the Appeal Panel made the usual directions for hearing, including requiring the parties to lodge with the Tribunal and provide to the other parties all evidence from the proceedings below on which they wished to rely, together with the sound recording and a typed copy of those parts of the sound recording on which they relied. 5. Each of the parties provided documents and written submissions. In addition, at the hearing of the appeal on 7 November 2017, the first appellant, Mr Shpak, provided oral submissions on behalf on both tenants as did the landlords' agent Mr Pose. 6. A disc of the sound recording was provided to the Appeal Panel. The parties had been directed to provide a typed copy of all relevant parts of the sound recording on which they wished to rely. However, we were not provided with a complete typed copy of what was said at the hearing. The parties provided some extracts of the sound recording they each said was relevant. 7. The tenants' written submissions were in similar terms to the document attached to the Notice of Appeal. They also included references to the sound recording of the evidence provided to the Tribunal. 8. The extracts of the sound recording referred to the following matters: 1. that the defects identified at 5.1-5.7 existed; 2. that request had been made for repair on multiple occasions; 3. that Mr Shpak told the Tribunal that he was doubtful the landlords would "perform any fixes and do any proper work, that is why we insist we be there"; 4. that the Tribunal had said on several occasions throughout the hearing that it was proposing to make an order for the landlords to carry out repairs within 28 days, but only on conditions that the tenants permit access and are not present while the repairs are carried out 1. Oral submissions were made by Mr Shpak in terms similar to the written submissions. 2. During these submissions, there was discussion with Mr Shpak and the Appeal Panel concerning the power to make conditional orders granted under s 58 of the Civil and Administrative Tribunal Act 2013 (NSW) (NCAT Act). Mr Shpak submitted that the provisions of ss 4 and 50 of the RT Act prevented a conditional order on the terms made by the Tribunal. Otherwise, there is no power in the RT Act to make such an order. 3. In addition, the Appeal Panel asked Mr Shpak whether the tenants vacated the premises as the order required so as to allow the landlords to carry out the repairs. Mr Shpak did not answer this question. Consideration 1. The tenants' Notice of Appeal raises questions of law and questions for which leave is required. In order to get leave, the tenants must demonstrate they may have suffered a substantial miscarriage of justice because the decision was not fair and equitable, against the weight of the evidence or there was significant new evidence which was not reasonably available at the original hearing: see Sch 4 cl 12 of the Civil and Administrative Tribunal Act 2013 (NCAT Act). The principles applicable to the grant of leave were set out by the appeal panel in Collins v Urban [2014] NSWCATAP 17. 2. The applications of the tenants essentially asked for five orders: 1. that the landlords carry out repairs; 2. that the rent be reduced, the rent being excessive due to a reduction or withdrawal of goods and services; 3. an order that rent be paid into the Tribunal pending the carrying out of repairs 4. an order for compensation; 5. termination of the residential tenancy agreement 1. As indicated above, the Tribunal made a conditional order for repairs. Otherwise, the Tribunal dismissed the tenants' application. 2. In its reasons, the Tribunal found: 1. The tenancy was for a term of 6 months commencing on 11 May 2017 and expiring on 10 November 2017; 2. The tenants' first raised concerns regarding items requiring repair on about 15 May 2017, almost immediately the tenancy commenced; 3. There was a meeting between the tenants and one of the landlords, Mr Sarakiniotis, and the landlords' agent on 15 May 2017 about these issues "but that meeting was unsatisfactory and did not result in an agreed way forward": at [4]. "Since then there has been no progress on these matters and the tenants have proceeded to first Fair Trading and now the Tribunal". 4. The tenants said that various matters required repair. Those were recorded as items 5.1-5.7: at [5]. Other matters were not being pressed by the tenants at the hearing because they were aware of them before they entered the agreement for they were problems with the building: at [6]. 5. Except for item 5.5, the spa, the landlords acknowledge these problems, some of which were minor. The landlords were willing to have a tradesman attend after the landlords had assessed the problems and attended to matters that did not require an independent tradesperson to fix. In relation to the spa, the landlords' agent said this was not part of what was offered under the agreement, the advertisement for the premises not offering a working spa: at [7]-[8]. The other repairs had not been carried out because the relationship between the tenants and the respondent "had deteriorated which now precluded this": at [7]. 1. Having referred to discussions which had taken place between the parties concerning an offer by the landlords to allow the tenants to terminate the agreement "early without charges or penalties", an offer which the tenants apparently declined, the Tribunal said at [12]-[13]: 12 The landlord (sic) then offered to attend to the matters in 5.1-5.4 and 5.6-5.7 above-including making a preliminary assessment of whether the landlord could fix the issue himself and if not make arrangements to obtain available trades help-within 28 days provided the (tenants) left the premises when he and his tradesman attended to allow this to occur uninterrupted. The (tenants) declined to do this and said they could not be made to vacate for this purpose either under the (agreement) or at law and that they were concerned for the security of the personal goods. 13 For these reasons, the Tribunal makes the conditional order outlined above, but declines to make any other order including any order for compensation, rent reduction, rent payable to the Tribunal ought to carry out any action by the landlord other than as ordered. 1. In addition to the typed orders which included what were described by the Tribunal as "BRIEF REASONS FOR DECISION", the typed extracts of the sound recording provided by landlords indicate the Tribunal made the following statements during the hearing (at the time marks set out below): Landlords' transcript extracts provided in the appeal 1:49:14 I don't regard these matters as sufficient to require termination. For termination of a lease the breaches of the residential tenancy agreement have to be significant and I don't regard these matters that have been raised as sufficiently significant to terminate the lease for 2 reasons. Firstly, there (sic) not sufficiently major on their own by the description. Secondly from the agent's account and attempt was made to resolve these at some stage inspecting the property but as a result of a falling out between you and the landlord they haven't been able, they haven't been back to the property since the 15th May and they say able to get access to fix them. 1:56:30 The issue for compensation is a matter for the Tribunal to determine that separately. 1:56:51 You won't get that because of the breaches you say exist aren't sufficient to justify a termination of the lease so that means the lease is on foot. 1:56:09 You can't stay in the apartment accusing the landlord of breaches that don't justify termination seeking compensation if you really don't want to be there, you have to make that decision. You seem to be leveraging that decision on what you can gain. I think you should just make your decision. 2:21:00 …. What I'm going to do is this is to make an order that the landlord carries out these repairs to the property within 28 days but only on the proviso that you allow them to do so and not be at the premises at the time I just don't think it's constructive for you to be there and if you don't do that well then the repairs won't be done… I am asking you to go for a walk around the block for an hour for the landlord trades people to ascertain the issue. You can shake your head Mt (sic) Shpak and that is your mindset unfortunately that is coming through in what you are saying. You refuse to allow the landlord free and unfettered access to his property to fix these problems without having to confront you in either a dialogue or some other conduct which may be unpleasant because it was last time, the Tribunal won't facilitate that. . 1. These extracts were provided after the hearing by leave of the Appeal Panel. This leave was granted because neither party had provided a complete transcript of the hearing and both parties sought to raise what had happened at the original hearing, the tenants having only provided the disc containing the sound recording. The tenants did not challenge the accuracy of the document provided by the landlord. 2. A resolution of this appeal requires a consideration of some of the provision of the RT Act to which the appellants refer and the reasons for decision. These are s 52 (health and safety), s 63 and 65 (repairs), s 70 (Locks), 3. Section 52 requires that a landlord must: 1. provide the residential premises in a reasonable state of cleanliness and fit for habitation by the tenant. (s 52(1)); and 2. comply with the landlord's statutory obligations relating to the health or safety: (s 52(3). 1. Section 70 says the "landlord must provide and maintain the locks or other security devices necessary to ensure that the residential premises are reasonably secure". 2. In relation to ss 63 and 65, those sections relevantly provide as follows: 63 Landlord's general obligation (1) A landlord must provide and maintain the residential premises in a reasonable state of repair, having regard to the age of, rent payable for and prospective life of the premises. (2) A landlord's obligation to provide and maintain the residential 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 residential premises. 65 Tenants remedies for repairs (1) Orders for which tenant may apply The Tribunal may, on application by a tenant, make any of the following orders: (a) an order that the landlord carry out specified repairs, (b) an order that the landlord reimburse the tenant an amount for urgent repairs carried out by the tenant. (2) Orders for repairs The Tribunal may make an order that the landlord carry out specified repairs 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, having regard to the age of, rent payable for and prospective life of the premises. (3) The Tribunal must not determine that a landlord has breached the obligation unless it is satisfied that: (a) the landlord had notice of the need for the repair or ought reasonably to have known of the need for the repair, and (b) the landlord failed to act with reasonable diligence to have the repair carried out. 1. Items 5.1 and 5.2 appear to relate to an obligation arising under s 70. Item 5.3 appears to relate to an obligation under s 52(1) or (3). Otherwise, all items appear to relate to an obligation to repair arising under ss 63 and 65. 2. The Tribunal records that the landlords agreed that all of these matters required repairs. However, the reasons do not record any finding that the landlords had: 1. failed to provide and maintain the locks or other security devices necessary to ensure that the residential premises are reasonably secure; 2. failed to provide the residential premises in a reasonable state of cleanliness and fitness for habitation or failed to comply with the landlord's statutory obligations relating to the health or safety; or 3. failed to act with reasonable diligence to have a repair carried out, which is a matter critical to the Tribunal determining that a landlord has failed to carry out repairs and breached the residential tenancy agreement: see s 65(3). 1. Rather, all the reasons record is: 1. That the landlords agreed certain repairs were required, being the items identified by the tenants (except the spa), those items having been notified of that need by the tenants; 2. That the items about which complaint are made (except the spa) are minimal and are not such to justify a termination order: and 3. That the landlord was prepared to rectify these matters and had sought to do so. 4. That these repairs had not been carried out because the relationship between the parties had broken down. 1. Further, its seems clear to the Appeal Panel that the repairs have not been carried out and that the tenants have not complied with order 1 made on 8 September 2017, which required the tenants to give access to the landlords to complete the agreed work and to vacate the premises while this occurred. 2. For convenience, we will deal with the tenants' ground of appeal and submissions under the following headings: 1. Power to make order 1 and impose conditions; and 2. Failure to make findings of breach and inadequacy of reasons; 3. Failure to terminate tenancy. Power to make order 1 and impose conditions 1. The tenants submitted there was no power which permitted the Tribunal to make conditional orders in respect of access when making an order for a landlord to carrying out repairs. 2. This submission is plainly wrong. 3. Section 58 of the NCAT Act allows the Tribunal to impose conditions in respect to an order. It is in clear and unambiguous terms. It states: 58 Power to impose conditions A power of the Tribunal to make an order or other decision includes a power to make the order or other decision subject to such conditions (including exemptions) as the Tribunal specifies when making the order or other decision. 1. There is no inconsistency between this power and the powers given to the Tribunal under the RT Act in respect of access and repairs that would exclude its operation. 2. Section 60, which is part of Division 4 of the RT Act provides: 60 Landlord's remedies relating to access to premises (1) The Tribunal may, on application by a landlord, make any of the following orders: (a) an order authorising the landlord or any other person to enter the residential premises for a purpose permitted under this Division, 1. That is, a landlord may seek an order for access, even when a tenant objects, for the purposed of carrying out its obligations including the obligation to repair found in s 63 of the RT Act. 2. Further, the Tribunal may make ancillary orders under s 188(c) of the RT Act. While the expression ancillary order is not defined in the RT Act, its ordinary English meaning is "subsidiary" or "supplementary or incidental relief sought in addition to the main relief": Macquarie Dictionary, Revised Third Edition. In Words and Phrases Judicially defined, Roland Burrows KC, Butterworths, 1946, ancillary is defined in the following terms: It is an additional remedy, the making more effective a remedy for the one cause of action. 1. The order made in the present case was to aid or supplement the primary order requiring the landlord to carry out agreed work. 2. The fact that one party to residential tenancy agreement may be obliged under the RT Act and/or the agreement to carry out various work does not mean the Tribunal cannot make an order requiring performance of that obligation conditional upon the other party giving access in a specified manner. For example, if the work was dangerous or hazardous, such a condition requiring a tenant to temporarily vacate the premises would be quite appropriate. A condition may also be appropriate where, by their conduct, the other party might interfere with the performance of the work or prevent a landlord from meeting their obligations under the RT Act or residential tenancy agreement. 3. Finally, the right of a tenant to quiet enjoyment found in s 50 of the RT Act and in the agreement, does not prevent such a condition being imposed, although the interruption of a tenant's quiet enjoyment may give rise to a claim for loss arising therefrom: see eg Worrall v Commissioner for Housing of ACT [2002] FCAFC 127 at [68] and following. As made clear in Worrall, even lawful interference (such as scaffolding to carry out necessary external repairs) which affects use of lease premises may amount to relevant interference with the right to quiet enjoyment. On the other hand, a tenant must generally provide access to allow a landlord to comply with their obligations in respect of the residential premises. 4. In the present case, it is clear that the Tribunal imposed the condition on the tenants so as to facilitate the carrying out of the work which the parties agreed need to be performed, namely items 5.1- 5.4 and 5.6 - 5.7. This occurred in circumstances where the Tribunal concluded that the relationship between the parties had broken down and where the tenants had declined to vacate the premises while the repairs were carried out. 5. In part, the decision of the Tribunal to impose this condition arose from the fact the tenants were asserting that the landlords were not entitled to carry out these repairs personally, but rather should engage a handyman or other contract to do so. There is no provision in the RT Act which prevents a landlord from personally carrying out repairs to their own property 6. The decision to impose a condition was also made so as to ensure the agreed repair work was uninterrupted by the tenants. 7. The imposition of this condition involved the Tribunal exercising a discretion. The basis for doing so was set out by the Tribunal in its reasons and no basis has been established for the Appeal Panel to interfere with the exercise of this discretion. 8. Accordingly this ground of appeal fails. Failure to make findings of breach and inadequacy of reasons 1. The second area of challenge was that the Tribunal failed to make any findings about whether or not the landlords breached their obligations under the residential tenancy agreement. 2. We agree with the tenants' submission that the reasons are inadequate. 3. Neither the "Brief Reasons For Decision" nor those extracts from the sound recording identified by the parties in this appeal record any findings concerning the claims by the tenants that the landlords had breached the agreement and/or the RT Act. 4. Rather, all the Tribunal's brief reasons record is as follows. 5. At [7]-[8]: 7. The landlord's agent said that the landlord acknowledged these problems and, although some were minor, was willing to have trades man (sic) attend after the landlord had assessed the problem. All of the items above with the exception of 5.5 the landlord's agent said the landlord was willing to address but needed access and then the opportunity to assess the problem to ascertain whether he could do it himself (5.3, 5.4, 5.6, 5.7) or whether it required a tradesman (5.1, 5.2). The relationship between the landlord and the tenant has deteriorated which now precluded this. 8. The landlord said the unit was purchased with a spa (5.5), that there was no utility in repairing it and that the unit was not advertised with a working spa. In fact, the landlord said the prospective tenants were told at inspection that the spa did not work, but the tenants denied this. 1. Then at [12], as set out above, the Tribunal recorded an offer apparently made at the hearing that the landlord would make "a preliminary assessment of whether the landlord could fix the issue himself and if not make arrangements to obtain available trades help-within 28 days provided the (tenant) left the premises when he and his tradesman attended to allow this to occur uninterrupted". 2. In their applications, the tenants sought orders for compensation and rent reduction arising from identified alleged breaches in connection with items 5.1-5.7. An entitlement to compensation and/or rent reduction only arose if the tenant established that the landlords had breached the residential tenancy agreement in consequence of which the tenant suffered loss and damage. A order to reduce rent requires that the tenants establish there has been a reduction or withdrawal of services 3. In relation to item 5.5, the spa, the tenant was required to prove that the spa was part of the facilities often under the agreement. There was some support for the tenants' claim that it was part of the agreement. In this regard, as is apparent from the documents attached to the applications filed with the Tribunal at first instance: 1. The agreement does not itself suggest the spa is excluded. 2. The incoming condition report records a defect in the spa button but does not otherwise suggest the spa is not part of what is provided under the agreement. It should be noted at this point that the incoming inspection report was apparently signed on 17 May 2017, after the tenancy had commenced. 1. On the other hand, the landlords denied that provision of the spa was part of the agreement. 2. The Tribunal resolved the claims for compensation and rent reduction by declining to make any order. No written reasons were given for doing so. Neither party pointed to any oral reasons or statements made by the Tribunal during the hearing that might explain why. 3. What the Tribunal was required to do was to determine: 1. what were the terms of the residential tenancy agreement; 2. whether the spa formed part of the agreement; 3. whether the landlords had breached the agreement in failing to carry out repairs or otherwise comply with their obligations under the agreement or the RT Act; 4. what, if any, loss and damage had been suffered by the tenants as a result of any breach; 5. whether there had been a withdrawal of goods or services and; 6. whether an order to reduce the rent should be made. 1. In considering these matters, it was also necessary for the Tribunal to have regard to s 65(3). As set out above at [35(3)], under that sub-section the Tribunal must not determine that a landlord has breached the obligation to provide and maintain the residential premises in a reasonable state of repair unless it is satisfied that the landlord: 1. had notice of the need for the repair or ought reasonably to have known of that need; and 2. failed to act with reasonable diligence to have the repairs carried out. 1. The evidence before the Tribunal in relation to items 5.1-5.4 and 5.6-5.7 as recorded in the written reasons suggests that there were items of work which the landlord had agreed to do. However, there were no findings that these items were defective in any relevant sense so as to give rise to a breach of the agreement and/or the RT Act. In this regard there were no findings that: 1. the toilet operation or other matters about which complaints were made meant there had been a failure to provide premises that complied with the landlords' obligations relating to health and safety: s 52(3). 2. the landlords failed to provide or maintain door locking devices "necessary to ensure the residential premises are reasonably secure": s 70. 3. the landlords had breached the agreement because they had "failed to act with reasonable diligence to have the (repairs) carried out: s 65(3). 1. As to item 5.5, there were no findings about why this item of claim was rejected. 2. We are therefore satisfied that there has been a failure to give adequate reasons and that that failure constitutes an error of law: see Collins at [56]-[60] and Beale v Government Insurance Office of New South Wales (1997) 48 NSWLR 430 at 443-4. Consequently, these issues should be remitted to the Tribunal to determine these claims. 3. Finally, in dismissing these claims, we note that the Tribunal said it "declined" to make an order. It is unclear as to whether this was because there was no relevant breach or loss proved or whether the Tribunal thought there was a general discretion to refuse a remedy in any event. 4. In so far as there is an established breach by the landlords, the tenants were entitled to have their claims determined according to law. This included an entitlement to be granted any appropriate remedy for an established breach upon proof of loss. In this regard there is not, generally, a discretion to withhold any remedy where relevant loss or damage or entitlement has been established: see Corcoran v Far [2018] NSWCATAP 13 at [64]-[68]. 5. Rather, the Tribunal is obliged to grant such remedy as is appropriate in the circumstances of the case. Failure to terminate tenancy 1. The last ground of challenge concerns the Tribunal declining to make a termination order. 2. Under s 103 of the RT Act and the general order making powers found in s 187, the Tribunal has a discretion to terminate the agreement. In connection with an application under s 103, the Tribunal must be satisfied that "the breach is, in the circumstances of the case, sufficient to justify termination of the agreement". 3. In respect of this issue, it is clear from the written reasons and the typed copy of parts of the sound recording to which we have been referred that the Tribunal concluded the issues raised by the tenants were not of such a serious nature so as to justify the making of a termination order. Secondly, it is clear that the Tribunal considered that if the tenants granted access to the landlords to carry out the repairs, this could occur with reasonable expedition, namely within 28 days from the date on which the orders were made. 4. While the landlord had offered to terminate the agreement by consent, these discussions were part of an attempt by the Tribunal to resolve the dispute during the hearing but do not otherwise reflect a breach under s 103 that would justify making a termination order. 5. Since the Tribunal declined to make a termination order on 8 September 2017, the tenancy has in fact continued. The agreement was for a fixed term and it appears from what was said at the original hearing that the landlords were intending to terminate the tenancy at the end of the fixed term as permitted by s 84 of the RT Act. No one suggested otherwise at the hearing of the appeal on 7 November 2017. The fixed term was due to expire on 10 November 2017. 6. While we have indicated above that the Tribunal failed to determine whether or not the landlords had breached the agreement, the findings made by the Tribunal about the significance of the identified problems provided a sufficient reason to decline to make a termination order. It follows that, regardless of the outcome of whether or not the matters about which complaint was made constituted breaches of the RT Act or agreement, the Tribunal was correct to dismiss the termination application. 7. Further, even if we took a different view of the breaches, we would not be inclined to exercise a discretion to remit the issue of termination for rehearing, because it is likely that the tenancy has already come to an end due to the expiry of the fixed term. If this has not occurred, the tenants may always commence further proceedings in respect of any continuing breaches by the landlords which might now warrant a termination order being made. However, a termination order is unlikely to be made as the tenants will, in these circumstances, have decided to continue with the tenancy beyond the fixed term period, a matter which would strongly count against their prospects of obtaining any termination order for past breaches. Orders 1. The only orders which should be made in the present case is to remit the proceedings to the Tribunal to determine: 1. Whether the landlords have relevantly breached the agreement or the RT Act in respect in respect of items 5.1-5.7; 2. If yes, what, if any orders should be made for compensation or rent reduction. 1. While the Tribunal made an order requiring the landlord to carry out the work specified in items 5.1-5.4 and 5.6-5.7, this order should not be set aside. This is because even if there has been no relevant breach by the landlords of their obligation to repair, having agreed to carry out work to the premises the Tribunal was entitled to make an order for access to permit appropriate maintenance work to be performed. If the repairs have not been carried out because the tenants failed to comply with an order of the Tribunal, that order not having been stayed by the Appeal Panel, that fact will remain relevant in determining what, if any award should be made for compensation and/or rent reduction. 2. Unless the Tribunal otherwise orders, the proceedings should be determined on the basis of the evidence originally filed as well as any oral evidence given by the parties at the original hearing. Preferably, the matter should be heard by the Tribunal as originally constituted. However, the Deputy President or Principal Member/ List Manager may make such orders as they consider appropriate as to who should hear this case. 3. Accordingly, the Appeal Panel makes the following orders: 1. The appeal is allowed in part. 2. The decision to dismiss the claim for compensation and an order for rent reduction in connection with items of claim 5.1- 5.7 recorded in paragraph 5 of the reasons dated 8 September 2017 is set aside. 3. The proceedings are remitted to the Tribunal to determine, in accordance with law, the appellants' claims for compensation and/ or rent reduction in applications RT 17/29667 and RT 17/34045 in respect of items 5.1- 5.7 only, being those items recorded in paragraph 5 of the reasons dated 8 September 2017. 4. Unless the Deputy President or Principal Member/ List Manager otherwise determine, the remitted proceedings are to be determined by the Tribunal as originally constituted on 8 September 2017. 5. Unless the Tribunal otherwise orders, the hearing of the remitted proceedings is to be determined on the evidence originally filed by the parties and any oral evidence at the hearing on 8 September 2017. 6. Nothing in these orders otherwise prevents the Tribunal from making such directions as it considers appropriate for the just, quick and cheap resolution of the real issues in dispute. 7. Save as provided above, the appeal is dismissed. ********** 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 23 February 2018 - Paragraph 58 - 8. word corrected in second sentence. 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: 23 February 2018