ACT CIVIL & ADMINISTRATIVE TRIBUNAL

ARSHAD v AUSTRAL INTERIORS PTY LTD ACN 125 741 102 (Appeal) [2019] ACAT 5

AA 40/2018 (RT 136/2018)

Catchwords: APPEAL – residential tenancies – new evidence – appeal allowed – damages for breach of clause 64(b) of the standard residential tenancy terms

Legislation cited: ACT Civil and Administrative Tribunal Act 2008 ss 60, 79, 82Residential Tenancy Act 1997 sch 1

SubordinateLegislation cited: ACT Civil and Administrative Tribunal Procedure Rules 2009

(No 2) 2009 s 21

Cases cited: Australian Coal and Shale Employees’ Federation v Commonwealth [1953] HCA 25Chakravarty & Commissioner for ACT Revenue [2013] ACAT 11The Medical Practitioner and The ACT Medical Board [2010] ACAT 63

Tribunal: Presidential Member E Symons

Date of Orders: 10 December 2018Date of Reasons for Decision: 11 January 2019

AUSTRALIAN CAPITAL TERRITORY )CIVIL & ADMINISTRATIVE TRIBUNAL ) AA 40/2018

BETWEEN:

OMER ARSHADAppellant

AND:

AUSTRAL INTERIORS PTY LTD ACN 125 741 102Respondent

APPEAL TRIBUNAL: Presidential Member E Symons

DATE: 10 December 2018

ORDER

The Appeal Tribunal orders that:

1. Pursuant to rule 21(c) of the ACT Civil and Administrative Tribunal Procedure Rules 2009 (No 2) the applicant is granted leave to file further evidence about questions of fact in this appeal.

2. Pursuant to rule 21(d) of the ACT Civil and Administrative Tribunal Procedure Rules 2009 (No 2) the appeal is allowed, the decision of the tribunal dated 22 August 2018 is set aside and the following orders are made.

3. Judgment for the applicant in the sum of $6,120 calculated as follows:

(a) judgment - $7,246

(b) less bond - $2,480

(c) less amount paid by respondent - $85

(d) plus filing fee - $559

(e) plus transcript costs - $880

4. Respondent to pay $6,120 to the applicant’s bank account by close of business 7 January 2019.

The Tribunal notes that:

The applicant provided the respondent with the details of his account at the conclusion of the hearing.

……………Signed……………..Presidential Member E Symons

REASONS FOR DECISION

Background

1. The applicant is the owner of a property at Tubman Place, Nicholls in the

Australian Capital Territory (property). The Independent Property Group

(managing agent) managed the rental of the property for the applicant.

On 20 December 2016 the applicant’s managing agent entered into a lease of

the property for the period 6 January 2017 to 7 July 2017 to the respondent.

2. At the end of the lease and on 18 December 2017 the managing agent, on behalf

of the applicant, filed a claim for compensation of $21,077.99 for the

respondent’s breach of clause 64(b) of the standard residential tenancy terms in

Schedule 1 to the Residential Tenancy Act 1997.1 The claim was for damage to

carpets, blinds, cracked tiles, mould in the kitchen, and for gardening, cleaning

and painting.

3. The Original Tribunal handed down its decision on 22 August 2018 (in

RT 136/2018) after a defended hearing on 31 July 2018 (original hearing). The

applicant had been represented by Kimberley Castle and David Protas from the

Independent Property Group at the original hearing. Mr Serge Golman appeared

for the respondent pursuant to an Authority to Act for a Corporation dated

3 July 2018 and filed with the Tribunal (Authority).

4. The Original Tribunal entered judgment for the applicant lessor in the sum of

$2,565 comprising: $581 compensation for damage to blinds in bedroom 1 and

bedroom 2; $500 compensation for a hairline crack to three floor tiles in the

main bathroom; $946 compensation for damage to carpet in the upstairs

common room; and $538 Tribunal filing fee.

5. The Original Tribunal further ordered that the bond of $2,480, which had been

released to the managing agent by the Office of Rental Bonds, be retained by

the applicant and credited against the judgment and that the respondent pay the

balance of the judgment of $85.00 to the applicant by 12 September 2018. The

balance of $85.00 was paid to the lessor.

1 Clause 64(b) provides that the tenant must leave the premises “in substantially the same condition as the premises were in at the commencement of the tenancy, fair wear and tear excepted”

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The appeal

6. The lessor lodged an appeal against the original decision in RT 136/2018 on

18 September 2018. He stated in the reasons for appeal:

The Applicant is appealing the original decision passed down by the Tribunal member on 22 August 2018 on the basis that the Tribunal member did not take into account all the facts and evidence of the case (error of fact). The Applicant has further evidence to prove that the amount of $21,077.99 was the total cost of repairs to the property. The Order dated 22 August 2018 awarded the Applicant the amount of $2,565.00 which was well below the actual total sought and which the Applicant is entitled to.

Further Evidence will be provided to the Tribunal prior to the hearing.

7. At the directions hearing on 8 October 2018 a timetable was set for the filing of

further material, the appeal was set down for hearing on 10 December 2018 and

direction 5 stated “The Appeal Hearing will proceed as a review of the original

decision unless the Appeal Tribunal otherwise orders.”

8. The appellant filed and served a comprehensive folder (Exhibit A1) which

included the Incoming Inspection Report and photographs, an Interim

Inspection Report dated 17 May 2017 and photographs, the Final Inspection

Report and photographs, and photographs, invoices and quotations for costs he

had incurred for gardening, carpet, painting, damaged grout in the kitchen,

ensuite bathroom tiles repairs, main bathroom repairs and upstairs toilet repairs

at the end of the lease.

9. The respondent did not file any further material.

10. The appeal was heard on 10 December 2018. The appellant appeared in person.

Mr Serge Golman appeared for the respondent pursuant to the Authority.

11. At the conclusion of the evidence and submissions, the Tribunal delivered oral

reasons for its decision, allowed the appellant’s appeal and made the orders set

out in the reasons for decision.

12. On 14 December 2018, the appellant requested a statement of reasons pursuant to

section 60(1) of the ACT Civil and Administrative Tribunal Act 2008 (ACAT

Act).

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13. The transcript of the oral statement of reasons is set out below.2

PRESIDENTIAL MEMBER: Thank you. So what I’d like to do is deal with this matter so that you don’t have to come back.

What I did at the commencement of this hearing was refer to the relevant sections in the ACT Civil and Administrative Tribunal Act, section 82(b), and to rule 21 in the ACT Civil and Administrative Tribunal Procedure Rules 2009 (No 2) which set out what the powers are that a tribunal has when dealing with an appeal. I am not going to repeat them.

So far as the background to this matter is concerned, the applicant has appealed a decision handed down on 22 August 2018 in relation to a claim which was lodged by the managing agents, the Independent Property Group, seeking compensation for damage it alleged had been caused to the applicant’s property in Nicholls, and it was the basis of that claim that the incoming condition report and the outgoing condition report showed that the property at the end of the lease had not been returned to the owners, the applicant, in a substantially similar condition to the condition of the property when the tenancy began, fair wear and tear allowed.

The tenancy agreement that was between the parties was entered into on 20 December 2016. It is a very short tenancy. It is a period of six months. Mr Arshad explained that the reason for that was that he settled his purchase of the property a number of weeks before he gave it to the Independent Property Management Group to rent because he had wanted to get his stamp duty refunded, and could do that if he had rented the property out for a period of six months. He was adamant, and I find that the lease which was dated 20 December 2016 commenced from Friday 6 January 2017, and while the lease provided for a period of six months to 7 July 2017, it actually ended on 30 June 2017.

Item number 6 of the lease agreement says, “Number of persons permitted”, three in words and figures, “adults only”. The property was rented unfurnished and in relation to item 16, smoking, it stated:

“The tenant and the tenant’s visitors agree to observe no smoking within the premises. The tenant will be responsible to ensure that all visitors abide by this clause.”

It is not in dispute that these premises were used for six months by the tenant for the purposes of accommodating some of the workmen who were working for the tenant when it was building the Canberra Hospital for the University of Canberra. At that time I am satisfied and find that the tenant rented multiple properties within the ACT for the purposes of accommodating its employees, and so far as Mr Golman understood, Michael Begic was the supervisor who managed this property, and up to other eight operations which he, according to Mr Golman, inspected regularly.

2 Pursuant to section 60(2) of the ACT Civil and Administrative Tribunal Act 2008

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So far as the individual items that were claimed, the Senior Member in her decision, which she delivered orally on 22 August of this year, noted that she was, notwithstanding that the amount claimed was in the vicinity of $20,000, that she was proposing to make an order which had judgment for the lessor in the sum of $2,565, and that was for damage for the blinds in bedroom 1 and bedroom 2; no compensation for damage to blinds in the other two bedrooms; $500 compensation for hairline cracks to three floor tiles in the main bathroom; $946 compensation for damage to carpet in the upstairs common room, plus the filing fee which was then $538.

The order also provided that the bond of $2,480, which had been released already to the lessor by the Office of Rental Bonds, was to be credited against the sum payable by the tenant, which left a balance of $85 payable by the tenant and I understand from the hearing today that that amount has been paid.

The claim was brought as a claim for compensation for breach of clause 64(b) of the Standard Residential Tenancy Agreement terms which are found in Schedule 1 to the Residential Tenancies Act which clause says:

“The tenant must leave the premises in substantially the same condition as the premises were in at the commencement of the tenancy, fair wear and tear accepted.”

The appeal was lodged by Mr Arshad within time and was listed for a directions hearing. At that directions hearing, a direction was made which required the appellant and the respondent to the appeal to file further material by a specified date. The applicant/appellant was to file the material on which he relied by 12 November 2018. The respondent was required to file the material on which it relied by 3 December 2018.

The appellant did file the material on which he relied by the due date, and emailed copies of the material to the respondent. I have marked the bundle of documents which the appellant filed as Exhibit A1. I made the comment during the hearing that it was a very well prepared statement setting out the list of errors of fact that he alleged had affected the decision of the Senior Member, and it was accompanied by submissions, and as well it included copies of photographs which the appellant sought to rely on as evidence for the appeal hearing.

The respondent did not file any further material and told the tribunal that they were content with the decision made by the Senior Member and asked, in effect, that this Tribunal confirm the orders that the Senior Member has made. The application was listed for hearing today, 10 December 2018. At  the commencement of the hearing I considered the request by the applicant/appellant for the further evidence which was contained in Exhibit 1 to be admitted in the hearing, and I indeed made orders pursuant to rule 21C of the ACT Civil and Administrative Tribunal Procedure Rules 2009 (No 2) granting the appellant leave to provide the further evidence about the questions of fact.

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As an appeal hearing, it has a slightly different format than does the hearing at first instance. The appeal powers of the tribunal are broad and flexible, and this is appropriate given the diversity both of the tribunal’s work and the circumstances of the people appearing before it. It is relevant that I note these matters. In the appeal jurisdiction, an appellant does not have standing to an appeal as of right, and is required by section 79(3) of the ACAT Act to identify a question of fact or law. Therefore a question of fact or law must be identified in the grounds of appeal that enables this tribunal to consider whether the Original Tribunal made an error, or made the error or errors raised in those questions.

The appeal tribunal stated this proposition in an earlier decision on which I sat which was Chakravarty & Commissioner for ACT Revenue,3 and doing so confirmed the earlier decision of The Medical Practitioner and the ACT Medical Board4 where a differently constituted appeal tribunal stated that the role of the appeal tribunal is limited to addressing errors in the original decision. In particular, an appellant cannot merely request the re-exercise of a discretion. The appeal tribunal in Chakravarty described the nature of its jurisdiction in relation to discretionary decisions as follows.

“It is well recognised that an appellate tribunal should not disturb a discretionary decision as there is a presumption that the discretion was exercised correctly and should therefore be affirmed unless clearly wrong. It is not sufficient to set aside a discretionary decision simply because another view could have been taken or a different decision reached.”

The High Court in Australian Coal & Shale Employees’ Federation v Commonwealth stated, and this is Kitto J:

“The true principle limiting the manner in which appellate jurisdiction is exercised in respect of decisions involving discretionary judgment is that there is a strong presumption in favour of the correctness of the decision appealed from, and that that decision should therefore be affirmed unless the court of appeal is satisfied that it is clearly wrong. A degree of satisfaction sufficient to overcome the strength of the presumption may exist where there has been an error which consists in acting upon a wrong principle, or giving weight to extraneous or irrelevant matters, or failing to give weight or sufficient weight to relevant considerations, or making a mistake as to the facts … the nature of the error may not be discoverable, but even so it is sufficient that the result is so unreasonable or plainly unjust that the appellate court [or tribunal] may infer that there has been a failure properly to exercise the discretion which the law reposes in the court [or tribunal] of first instance.”5

3 [2013] ACAT 114 [2010] ACAT 635 [1953] HCA 25 per Kitto J

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I now turn to the individual matters that were raised in the appeal, and I note that they were all questions of fact, and that the applicant’s case is that the Senior Member who heard the original hearing did not accord proper weight to the evidence, or that the decision that she made on the facts was wrong.

I note that, and I deal with the blinds first, the Original Tribunal ordered one half of the amount claimed as the incoming condition report had stated blinds in two bedrooms were damaged, and while there was no evidence as to what part or parts of them were damaged, it was however able to be satisfied from that report that the fact that the other blinds were damaged at the outgoing condition report, that, at the end of the day, they were in a condition that was substantially worse than they were at the beginning of the tenancy.

So the Original Tribunal found that two of the blinds were already damaged, and while they might have continued to be damaged, there was no evidence that there was further damage to two of those blinds during the tenancy, but that there were blinds in two bedrooms that were not damaged and were damaged at the end of the tenancy, and so the Original Tribunal found that the amount of $581 was the correct amount to award in accordance with that finding.

Mr Arshad informed the tribunal that he did not disagree with that aspect of the Original Tribunal’s decision, so in those circumstances this tribunal is satisfied that there was no error of fact on the part of the Original Tribunal in reaching that part of its decision. I now turn to the ensuite.

The Original Tribunal said there was no photographic evidence of the cracked tiles, and that the evidence, such as it was, did not say how many tiles were cracked. The Appeal Tribunal now has that photographic evidence, and is satisfied that three tiles were cracked in the ensuite. In relation to the main bathroom, the Original Tribunal found that the tenant had breached clause 64(b) as at the end of the tenancy there was evidence of a hairline crack across two and a half floor tiles, and the Original Tribunal found that the condition of the main bathroom was not substantially the same at the end of the tenancy as it was at the beginning. The tenant had argued before the Original Tribunal that this damage to the main bathroom tiles was fair wear and tear, and that it could have been the result of subsidence, but produced no independent or credible evidence to support this.

The Original Tribunal found that the invoice that was provided for the repair work to the main bathroom showed extensive work and she was not satisfied that that extensive work was reasonable or necessary to repair the hairline cracks, and that there was no expert evidence as to why such extensive work was necessary.

There was a possibility that the actual work claimed may have been associated with repairing a plumbing leak, but again the Original Tribunal did not have any expert evidence available. The Original

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Tribunal allowed $500 for replacing the three damaged floor tiles. I have worked out that that is $166 per tile or thereabouts.

The Appeal Tribunal has had similar concerns to that raised by the Original Tribunal in that there were alarming similarities in the invoices provided by the real estate agency to the appellant for the work in the main bathroom and in the ensuite. This work was identical down to the 99 cents for work claimed in each of those invoices, and apart from the alteration of a figure of two walls in the shower to three walls, it seemed that the rest of the narrative in those invoices was word for word. The invoices were not at all helpful to the Tribunal. They were what I refer to as global invoices. They gave the Tribunal no idea as to what each item of work which had been carried out cost, and it didn't provide any evidence that would help the tribunal determine on its face whether the hairline crack was the cause of all of the work that had to be carried out.

The upstairs toilet, the outgoing report noted, had cracks to the wall and floor, and the Tribunal notes that the Original Tribunal did not have photographs and found in that case that the claim for $4,350.01 included again very extensive work, and there was insufficient evidence of the necessity for ripping out all of the floor tiles and replacing the toilet pan.

The Appeal Tribunal now has photographic evidence which clearly shows cracks to the floor tiles. Again, the tenant’s representative said that this could be fair wear and tear or subsidence, but again did not produce any evidence to support that point of view.

It falls to the Tribunal to determine whether the Original Tribunal’s approach to the main bathroom, given the evidence that this Tribunal now has available to it, can be applied to the damaged tiles in the other two rooms. The Tribunal is satisfied that the $166 per tile should be included for the four broken floor tiles in the upstairs toilet, that makes a total of $666; that the $500 should be allowed for the three tiles in the main bathroom; and that the three tiles in the ensuite should also be included; and I reiterate that that is because the Tribunal now has the evidence that was not available to the Original Tribunal.

So on my calculations it would seem that, had the evidence been available to the Original Tribunal, following the reasoning for the calculations of the damage to the tiles in the main bathroom, an amount of $500 for the three tiles in the main bathroom, an amount of $500 for the tiles in the ensuite, and an amount of $666 for the tiles in the upstairs toilet would be allowed, and the Tribunal proposes to make such an order. So that makes a total of $1,666.

In coming to this conclusion, the Tribunal has also taken into account the outstanding matters of the kitchen grout, and in dealing with that the Original Tribunal noted both the incoming and outgoing reports and was not satisfied there was a substantial change in grouting at the end of the tenancy. Notwithstanding the extra photograph the applicant provided to the Appeal Tribunal, I cannot be satisfied that the condition between the incoming report and the outgoing report is substantially different. I did

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note that in the invoice it appeared to more usefully and helpfully identify the reason for that work, being the failure of the grouting behind the sink.

I do note that the work included using a newer, and what Mr Golman acknowledged, a better, substance, but that it was silicone that was used and that the previous substance was grouting but in all the circumstances I am not satisfied that the Original Tribunal failed to exercise the discretion properly in disallowing the claim of $150 for the kitchen grouting.

In relation to the painting, that was a more contentious issue. The appellant had provided, as I said, in his quite helpful invoices, under “Painting”, that he was claiming an amount of $2,545, and he says there was some sort of splashes on the main front wall of the property which were not present when it was rented out. The splashes were straight out on the wall that is outside the main big window in the upstairs central sitting area where carpet was burnt out as well. He said, “I’m not sure how it was caused, but mainly because of the reason, how the property was maintained during the period”, and he points out it is very clear from the inspection report – which he provided in Exhibit A1 – of an inspection carried out on 17 May 2017, that the property was not well looked after. The applicant says:

“It was never looked after, “with the whole property being badly dirty with food, smoking and drinking stuff all around inside the house as well. The reason I am appealing the decision is because there was no evidence provided by Independent Property Agents, even though it was passed on to them before the hearing.”

Also as per the invoice, “Only a little patch could not be painted. I had to paint the entire front wall”. There are four large photos that are included as part for the claim of the painting. I asked the appellant if he was aware of what the substance was that was appearing on the outside wall and on to either the roof tiles or slate, and he said that he did not know what it was, but he had visited the property on the day that the cleaner was trying to clean the house and was told that the cleaner had been unable to remove it.

I said that if it had been something that was ejected out of the window – and recognised, as did Mr Golman, that it could have included vomit – had anyone tried to hose it off. Mr Arshad’s evidence was that he did not think it was able to be hosed off, and that he relied on the agents who had engaged the painter to do the painting work and on the advice of the painter … that the whole of that wall needed to be painted, for which the agents were charged $660.

In relation to the second part of the painting, the charge on the invoice was for eaves at the front of the house affected by the same splash marks, $565. There is a charge for plastering in relation to a ceiling which is picture number 4, and it is explained as plastering of a section to ceiling cut out to inspect pipes by owner, and that is a charge for plastering as opposed to painting of $440, and the painting of the entire kitchen and dining ceiling to ensure that it was even and matched.

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Looking at photo 4 which shows a boomerang shaped mark on the ceiling of the entire dining room, or on the part of the dining room ceiling, I note that photograph number 3 in this section shows that there is a kitchen area, a dining area and a living or lounging area or family room area, and I asked Mr Arshad whether it was the case that the dining area occupied about a third of that large area, and he said that it did.

He said that the plaster in the ceiling had been cut out to see if there was a leak from the showers above the dining room that might have caused the mark or the stain in the ceiling, and he stated, “To be honest, I’m not a hundred per cent if any leakage was found from the pipes”. However, this mark was never present there and was definitely something that was done at the time the property was rented out to the tenants.

The amount claimed for the painting of the entire kitchen and dining ceiling was $880. The tribunal was satisfied that the amount of $880 was not a reasonable amount to include for the painting of the whole area. It did appear, and this is an aside, that Mr Arshad may not have understood that in his discussions with the managing agents he was giving them permission to go ahead and engage the tradesmen to do the work. That is unfortunate if that is the case because, again, the painting tax invoice is minimalist. It has almost insufficient information. I do not know what hourly rate this painter is charging. I do not know whether he is charging for paint … there is what I would say is a dearth of information which makes dealing with these matters very difficult.

I would have expected your agents would have known that and that they should have got the extra information, and a statutory declaration from the painting contractor could have addressed that matter. My calculations was one-third of the $880 claimed for the painting of the ceiling is $294. That takes me to the carpet, and in relation to the carpet, this was probably the most controversial amount.

The amount claimed was $5,676. Mr Arshad’s evidence was that there were, in the outgoing report, stain marks shown in the upstairs, and I note that this is a two-storey house – the upstairs contains five rooms, four of these rooms had stains and one was clean. These rooms comprised four bedrooms and a smaller family area at the top of the stairs.

Mr Arshad said there was a brownish stain in the main bedroom upstairs. There was another stain near the wall in bedroom 1. There were, in bedroom 3, a stain and small holes, he believed from smoking. Bedroom 4, stains and a burn mark; bedroom 4 is downstairs. In the central living area there were burn marks, and in the study downstairs, as well as the stain marks, there were burn marks.

In answer to a question by me he said that the carpet throughout the house, that is the downstairs room and the upstairs area, was the same, but he was told by the carpet contractor, and this is indeed confirmed in the invoice, that they could not match the carpet that was there existing.

Mr Arshad, did the same carpet go up the stairs?

MR ARSHAD: Yes.

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PRESIDENTIAL MEMBER: So what happened to the stair carpet? Was that replaced?

MR ARSHAD: Yes.

PRESIDENTIAL MEMBER: So not only did they do the living areas up the top - - -

MR ARSHAD: No, they did the upstairs and the stairs

PRESIDENTIAL MEMBER: And the stairs?

MR ARSHAD: Yes.

PRESIDENTIAL MEMBER: And they took some carpet from upstairs.

MR ARSHAD: And put it in the down room.

PRESIDENTIAL MEMBER: In the down stairs room. All right. Now I understand. Nowhere, unless Mr Arshad, you can take me to where in the stairs, there is reference to dirt or something on a bottom step.

MR ARSHAD: Yes.

PRESIDENTIAL MEMBER: But I couldn't see any other evidence of burn marks or stains on the stairs.

MR ARSHAD: I may not have a picture. I don't know, if it’s not there.

PRESIDENTIAL MEMBER: Once again in a global quote which is almost useless, it’s very difficult to work out how much was actually the cost of doing the work that was done. I am satisfied that $380 was the work for using the carpet from upstairs, cutting it and relaying it downstairs, and it does say, “In order to do that we would need to replace the whole of the upstairs carpet living area, plus the stairs with a similar quality carpet”.

The Senior Member, my recollection is that she said:

“The evidence of the condition of the carpet at the end of the tenancy contained in the outgoing condition report and the photos, I note the photos were taken before the cleaning was done so a lot of that is very hard to differentiate between what is attributable to dirtiness and what is attributable to damage. And in relation to the photos filed there were two, and both were taken, as I say, before the cleaning. One shows a small dark mark and the other shows something very hard to interpret … at the hearing the lessor filed, by leave of the Tribunal, another photo which shows two holes of indeterminate cause. It was hard to tell what the scale was. There is nothing there to indicate what the scale of those holes, the size of those holes was, but the lessor’s agent says they were burn marks to the upstairs common room. I am satisfied that this was the case and that at least in relation to the upstairs common room the carpet was not substantially in the same condition at the end of the tenancy as it was at the beginning, but the lessor has claimed the cost of recarpeting the entire premises on the basis that a carpet from upstairs has moved downstairs, and all sorts of things. So it is very hard to apportion what part of that quote might be attributable to

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just recarpeting the upstairs common room. However, I have allowed one sixth of the amount as there seems to be roughly six areas which were carpeted originally, and I have come up with an amount of $946 to compensate the lessor in relation to the damage to the carpet in the upstairs common room.”6

I have had the benefit of photos to look at in Exhibit A1 in relation to the carpet that was in the upstairs – the remaining three of the upstairs rooms – and I am satisfied that one of the rooms upstairs did not have any damage to its floor.

One of the major concerns for me in this particular tenancy is that there was clearly a no smoking clause, and that seems to have been blatantly breached by the tenant, and I do not know whether it is their visitors, but they were committed to agreeing to observing no smoking within the premises and the tenant says and agrees to be responsible to ensure that all visitors abide by this clause.

The problem is that the inspection report in May of 2017 had photographs annexed to it. It is not a very nice report to read, I have got to say, because under the status of every room is “dirty”, that is the word, except front yard was satisfactory – “Front yard free of weeds. Bushes require some minor trimming. Back yard tidy but some minor weeds in paving” – but it is a very poor report.

The tenant is asked to clean the mould and dirt from all areas in the bathroom, ensuite and downstairs toilet, and upstairs toilet and debris stains from all bedrooms and common areas including tiles and carpet, and then other matters which do not particularly apply or are relevant for this appeal.

That report concludes with:

“Please note the following evidence of cigarettes throughout the property. We advise again that there is no smoking permitted in the property for tenants and their guests as per your tenancy agreement. I noticed a remedy has been issued for this matter. The property will require reinspection. I will contact you to arrange a time to inspect.”

In my very quick look through these photographs, my recollection was that in the ensuite there is a glass container of some description with cigarette butts in it. It looks like it is at the floor outside the shower. There are cigarette butts in a plastic cup on a dining room table. There were cigarette butts in the lounge room. On the windowsill there is at least one container, it looks like a takeaway drink container, with cigarette butts, and in the upstairs common room, which clearly is a breach and I am in no doubt that the burn marks are clearly caused by cigarettes, and had that evidence been available to the Original Tribunal, it would have persuaded the Original Tribunal that there was a lot of damage to the carpet and that it was not in the particular circumstances a

6 Extract of oral reasons delivered by the Original Tribunal on 22 August 2018

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proper exercise of the Original Tribunal’s discretion to only order one-sixth of the amount to be payable by the tenant.

It seems to me that the proper exercise of the discretion to ensure that there is not an unreasonable exercise or a failure to properly exercise the discretion and to address that, that the one-sixth would potentially be the stairs, and I am not satisfied from what I have seen that there is any damage to them, and that the one-sixth should be deducted from the $4,780 which was the amount that was claimed; so that brings that amount for the upstairs down to $3,834, but I note that there was a charge of $380 to recycle the upstairs carpet into the room downstairs which also had burn marks, and so that should be included, which brings it to $4,214 as opposed to the $5,676 claimed.

The other amount that I am satisfied was not in dispute is the gardening, and that the amount for that is $495, so I just want to add these up and I am going to invite each of you to check this arithmetic. So the blinds $581; the tiles or the broken tiles, I will do it that way, $1,666; painting, $290; carpet, $4,214; and the gardening - sorry, that amount again, please?

MR ARSHAD: 495.

PRESIDENTIAL MEMBER: 495.

MR GOLMAN: Do we credit what has already been paid?

PRESIDENTIAL MEMBER: I will come to that. I am just going to total this up and then we’ll come back because we have got to look at the bond as well. I don't know whether, have you added this up, Mr Golman?

MR GOLMAN: I did, yes. I just, I added the extra over because I don't know, I already paid the tiling, blinds and tiles, so my ... (inaudible) ... amount is $5,219 but that's not the way you’re doing it.

PRESIDENTIAL MEMBER: It might come to the same. I got those expenses to total $7,246. Did you get that?

MR GOLMAN: I’ll just check that, so it’s 5219 plus 581. I’ve got 7246, is that what you got?

PRESIDENTIAL MEMBER: Yes. And then you take off 2480, so that comes to 4766, and I think, did you say you paid another 85?

MR GOLMAN: Yes.

PRESIDENTIAL MEMBER: Do you agree with that?

MR ARSHAD: Yes.

PRESIDENTIAL MEMBER: And there's the appeal fee. How much was that, Mr - - -

MR GOLMAN: It says here 531.

PRESIDENTIAL MEMBER: It’s five something.

MR GOLMAN: 538.

PRESIDENTIAL MEMBER: No, this one’s 559 for the appeal.

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MR GOLMAN: So we have to pay that?

PRESIDENTIAL MEMBER: Yes.

MR ARSHAD: So what about the transcript that I got for - - -

PRESIDENTIAL MEMBER: Yes, how much did you pay - you had to pay for that?

MR ARSHAD: $880.

PRESIDENTIAL MEMBER: 880?

MR ARSHAD: Yes.

PRESIDENTIAL MEMBER: It doesn't surprise me. It’s terribly expensive.

MR ARSHAD: It is.

MR GOLMAN: Do we pay that as well, do we?

PRESIDENTIAL MEMBER: Yes, it goes into the - while you can’t charge costs, you can charge disbursements or expenses that are incurred and that’s one of the very few that, you know, so is searches, our other expenses which is a payment out that the applicant has had to make. So let me just keep going. 559 plus 4681 is 5240 plus 880, so it gets us to $6,120. So do you agree with those figures?

MR GOLMAN: More or less, yes.

PRESIDENTIAL MEMBER: Yes.

MR ARSHAD: Can I - sorry.

PRESIDENTIAL MEMBER: So I’ve got something wrong?

MR ARSHAD: No. Yes, sorry.

PRESIDENTIAL MEMBER: Yes, tell me.

MR ARSHAD: And I could be wrong but anyway, the initial fee that was paid, do we need to add that one as well?

PRESIDENTIAL MEMBER: You should have already got that, so that was in the original and I thought what - let me just check, Mr Golman.

MR GOLMAN: Sure.

PRESIDENTIAL MEMBER: You were ordered to pay - sorry, I’ll go back to the order which is - it should have automatically gone into - so the amount that was to be paid was 581, 500 for the tiles, 946, 538, and less the - so it seems what - let me just add those up and see if I can get - I can clarify that, and then I’ll clarify with Mr Golman what’s actually been paid. So that came to $2,565, and then off that the Senior Member took the bond, 2480, and I think that’s what leaves the - it does, that’s what leaves the $85. So you paid the $85 to Independent or - - -

MR GOLMAN: Yes.

PRESIDENTIAL MEMBER: Okay. And so Independent have the bond.

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MR ARSHAD: Yes, they do, and they actually, they paid me that $85, whatever owing of - put them into my account.

MR GOLMAN: Yes.

PRESIDENTIAL MEMBER: Yes, and did Independent pay the filing fee on your behalf or did you pay that?

MR ARSHAD: Yes, they paid it.

PRESIDENTIAL MEMBER: They paid it, so they would have - - -

MR ARSHAD: They would have - they took it out of, I think of the bond or something.

PRESIDENTIAL MEMBER: It’s been included. Let me just, I’ll try my best to be clear.

MR ARSHAD: Sure.

PRESIDENTIAL MEMBER: The previous order made a total of $2,565, and that included the filing fee of $538.

MR ARSHAD: Yes.

PRESIDENTIAL MEMBER: So then the Senior Member said, “Right, the bond’s already been released. We’ll take that off, that leaves $85”.

MR ARSHAD: Yes.

PRESIDENTIAL MEMBER: Mr Golman’s company has paid that $85.

MR ARSHAD: Yes.

PRESIDENTIAL MEMBER: So that the real estate agents have received $2,480, plus $85. Right? So if you then say, okay, so that’s - so they’ve actually received the full amount of the judgment.

MR ARSHAD: Yes.

PRESIDENTIAL MEMBER: Right, so that what they got was $2,565 which included your filing fee as one of the four items of compensation.

MR ARSHAD: Yes.

PRESIDENTIAL MEMBER: Plus Mr Golman’s $85. So that doesn't get repaid to Mr Golman, but it doesn't get paid again. Okay? So if Independent paid that when they filed the application for you, then they would have repaid themselves out of the bond.

MR ARSHAD: Yes, they would have.

PRESIDENTIAL MEMBER: So do you follow that?

MR ARSHAD: Yes, I get it.

PRESIDENTIAL MEMBER: So does that answer your question? You still look a little bit concerned.

MR ARSHAD: Yes, the only thing, and I could be wrong, I just want to - - -

PRESIDENTIAL MEMBER: No, just ask me.

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MR ARSHAD: Yes. If we are going back to, like, so are we - this $7,246, the figure that we have come to, is this the new figure?

PRESIDENTIAL MEMBER: Yes.

MR ARSHAD: Okay. That's fine then. I’m happy with that.

PRESIDENTIAL MEMBER: So that’s the new figure, but it’s not the amount that Mr Golman’s company has to pay.

MR ARSHAD: Yes, yes, I understand.

PRESIDENTIAL MEMBER: So from that you take the deposit, and then you - so that brought it down to $4,766. Then you take off the $85 that he’s paid.

MR ARSHAD: Yes.

PRESIDENTIAL MEMBER: Which brings it to $4,681. Then you add on the filing fee for the appeal, $559, and then you add on the transcript, and on my calculations that brings it up to $6,000 - I’d better double-check that because that may not be right, $4,681 plus 559 is 5240, and then plus 880, $6120.

MR ARSHAD: Yes, that's right.

PRESIDENTIAL MEMBER: So you follow?

MR ARSHAD: Yes, I do.

PRESIDENTIAL MEMBER: That’s what’s most important is that you follow.

MR ARSHAD: Yes, that's right.

PRESIDENTIAL MEMBER: Mr Golman, did you follow?

MR GOLMAN: Yes.

PRESIDENTIAL MEMBER: And I’m going to ask when can that money be paid. Usually it’s 28 days.

MR GOLMAN: That's fine.

MR ARSHAD: Can I just ask a question, another thing, please?

PRESIDENTIAL MEMBER: Sorry, you want to ask another?

MR ARSHAD: Yes.

PRESIDENTIAL MEMBER: Yes, yes.

MR ARSHAD: Yes, question another thing, please. As far as the defendant is concerned, they have closed this account. Now I’m dealing with Simmons & Laings to pay them this amount. So what I’m going to ask you is, can this amount be transferred into my account?

PRESIDENTIAL MEMBER: Yes, that's fair enough because you are now the applicant. Are you prepared to give on a piece of paper out of your pad the - - -

MR ARSHAD: Yes, sure, my account number and details?

PRESIDENTIAL MEMBER: Yes, so that it can be handed to Mr Golman.

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MR ARSHAD: Yes.

MR GOLMAN: And the amount please, I’ll just give it straight to that one.

MR ARSHAD: Yes, yes, 6120.

MR GOLMAN: Which is just a fraction more than what I offered outside.

PRESIDENTIAL MEMBER: Is that right?

MR GOLMAN: Yes.

MR ARSHAD: Not a fraction, but - - -

PRESIDENTIAL MEMBER: Well, look, it’s whichever you - - -

MR ARSHAD: It’s more than what it was. Right, there you go. … [bank account details given]

MR GOLMAN: And that's the name of the account?

MR ARSHAD: Yes, that's the number in there.

PRESIDENTIAL MEMBER: So that’s all very clear.

MR GOLMAN: Yes.

PRESIDENTIAL MEMBER: Please don’t lose that because I don’t keep a record of it. We don’t put it in the orders.

MR GOLMAN: No problem.

PRESIDENTIAL MEMBER: In case they fall into someone else’s hands.

MR GOLMAN: No problem.

PRESIDENTIAL MEMBER: All right? Are there any questions before I let you …?

MR ARSHAD: No, very much done like this.

PRESIDENTIAL MEMBER: All right. Thank you. You’ve got to travel back to Sydney?

MR GOLMAN: I do.

PRESIDENTIAL MEMBER: Is it Sydney?

MR GOLMAN: Yes.

PRESIDENTIAL MEMBER: Yes, safe travelling.

MR GOLMAN: Thank you.7

Other matters

14. During the hearing of the appeal the appellant asked the Tribunal, if it was to

publish a written decision that it include in the decision why some of the

invoices he was relying on were rejected, as he wanted to go back to the

7 Transcript of proceedings 10 December 2018 pages 91-106

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managing agent and question the adequacy of these invoices he was supposed to

pay.8

15. Both the Original Tribunal and the Appeal Tribunal observed that the two invoices

for repairs to the ensuite bathroom and the main bathroom issued by Laing +

Simmons Facility Management, invoice 4493 and invoice 4540, were

practically identical in the job description and identical in the invoiced amount

of $3,349.99. The applicant, and the managing agent in the original hearing,

told the tribunal that the damage was ‘cracked tiles’ in these bathrooms.

However, each Invoice Summary identified the ‘Work Order” as ‘damaged

grout’ and described the work in each invoice as:

Attended site. Remove and refit existing shower screen (No warranty offered on

shower screen) Remove shower floor tiles and bottom row of wall tiles of 29 shower

walls and repair cement bed, where required Waterproof, including flexible bandage (bond breaker) Retile shower floor and bottom row of walls with 200mm x 200mm

white tiles Carry out Megasealed service including all floor joints Seal around tap spindles Fit new metal floor waster grate

Job complete

16. The appellant was not able to explain to the Appeal Tribunal why the work

detailed in each of the invoices was reasonably necessary to repair cracked tiles.

The invoices were not itemised. They did not provide a breakdown of the

amount invoiced into a charge for labour, the rate of such charge, the number of

hours worked and the cost of material provided. It was not readily apparent why

both of these invoices were for the identical amount. The invoices were not

helpful as they raised more questions than they answered.

17. The tribunal may have been assisted by the appellant, or his managing agent at the

original hearing, filing statements from the tradespeople who carried out this

work setting out their qualifications and experience, what they were asked to do,

why the work order states ‘damaged grout’, their assessment of the cracked

8 Transcript of proceedings 10 December 2018 page 58 lines [40]-[45]9 For ensuite invoice 4540. Invoice 4493 for main bathroom had ‘3’

shower walls

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tiles, why the work described in their invoices was considered reasonable to

repair the cracked tiles and how the total cost of each invoice had been

determined.

18. The Original Tribunal found that the tenant (the respondent) was in breach of the

residential tenancy terms in relation to the cracked tiles but also found that the

lessor (the applicant) had not produced any expert evidence from a qualified

tradesperson as to why such extensive work was necessary and had, therefore,

not discharged the onus on him.

19. In response to a question from the Appeal Tribunal, the appellant said he had not

approached Megaseal, who carried out the repairs to the ensuite and bathroom,

and asked them to complete a Statutory Declaration for the appeal hearing. He

said:

No, I did not, and again, as I said this is what Independent got done, and being [a] professional company I would trust them that [what] they’re getting done is right without [me having] any knowledge of building or anything.10

20. The Appeal Tribunal had the additional photographic evidence which was not

provided to the Original Tribunal and, based on that, determined that the

Original Tribunal had made an error of fact in relation to the damage to the tiles

on the floor of the toilet room, the main bathroom and the ensuite. The Appeal

Tribunal decided that the damage to these areas was $1,666. The Appeal

Tribunal acknowledges that this was considerably less than the invoice for the

toilet floor ($4,350.01), main bathroom ($3,349.90) and ensuite ($3,349.99) but

agreed with the Original Tribunal’s reasons set out at paragraph 18 above.

……………………………….Presidential Member E Symons

10 Transcript of proceedings 10 December 2018 page 69 lines [20]-[22]

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HEARING DETAILS

FILE NUMBER: AA 40/2018

PARTIES, APPLICANT: Omer Arshad

PARTIES, RESPONDENT: Austral Interiors Pty Ltd ACN 125 741 102

COUNSEL APPEARING, APPLICANT N/A

COUNSEL APPEARING, RESPONDENT N/A

SOLICITORS FOR APPLICANT N/A

SOLICITORS FOR RESPONDENT N/A

TRIBUNAL MEMBERS: Presidential Member E Symons

DATES OF HEARING: 10 December 2018

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