ACT CIVIL & ADMINISTRATIVE TRIBUNAL

BONKE v VANNER (Residential Tenancies) [2019] ACAT 24

RT 932/2017

Catchwords: RESIDENTIAL TENANCIES – bankruptcy – unapproved alterations – compensation for improvements – rental arrears – rental credit

Legislation cited: Residential Tenancies Act 1997 section 52, standard terms 54, 63, 64, 65, 67, 68

List of Texts/Papers cited: Allan Anforth, Peter Christensen and Christopher Adkins,

Residential Tenancies Law and Practice New South Wales (The Federation Press, 7th edn, 2017)

Tribunal: Senior Member A Anforth

Date of Orders: 14 February 2019Date of Reasons for Decision: 14 February 2019

AUSTRALIAN CAPITAL TERRITORY )CIVIL & ADMINISTRATIVE TRIBUNAL ) RT 932/2017

BETWEEN:

JUANITA BONKEApplicant

AND:

MARK DAVID VANNERRespondent

TRIBUNAL: Senior Member A Anforth

DATE: 14 February 2019

ORDER

The Tribunal orders that:

1. The respondent is to pay the applicant the sum of $8,418.13 on or before

30 June 2019.

………………………………..Senior Member A Anforth

REASONS FOR DECISION

Introduction

1. The applicant is the lessor of a residential premises in the Australian Capital

Territory and the respondent was the tenant. The parties entered a residential

tenancy agreement in the standard form set out in Schedule 1 to the

Residential Tenancies Act 1997 (RTA). This agreement was set to last one year,

commencing 7 June 2013.

2. The tenancy agreement was arranged by a property management service,

Oz Property Services Pty Ltd (Oz Property).

3. The respondent vacated the property in late March 2014, and it was re-let

approximately five weeks later. At the time the respondent vacated, he was in

arrears for rent and had not paid rent since mid-December 2013. Here the

accounts differ, with the applicant claiming the respondent was three months in

arrears1 and the respondent claiming it was only four weeks.2

4. During the tenancy, the respondent made a number of alterations to the

property. These works included the installation of an air-conditioner, clothes

dryer, ADSL2 connection and TV antenna, as well as some concreting and

fencing in the yard. Additionally, on vacating, the respondent left a fridge and

washing machine at the property, along with the items associated with his

alterations.

5. The applicant claimed these alterations were unauthorised. The respondent

claimed he had authorisation to make them from the agent, and that there was a

further agreement that he could leave the fridge and washing machine at the

property.

6. The respondent claimed that the alterations were done with authorisation from

the agent and with the hope that the applicant would allow some rent credit for

the respondent for the work and items left at the premises. The agent denied

having a discussion with the respondent about rental credit, but email records

1 Application for Resolution of a Dispute under the Residential Tenancies Act 1997 8 November 2017 Annexure A, [3]2 Respondent’s Response 2 February 2018 page 1

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show that various rent credits were in fact made by the agent. The applicant

took issue with the lawfulness of these credits and sought recovery.

7. The applicant asserted various acts of dishonesty on the part of the agent

relating to these rent credits which had the effect of reducing the final rent

arrears. Much of the time and energy in these proceedings were devoted to the

discovery of the agent’s records.

8. The parties were told that any dispute between the applicant and the agent is a

separate matter that the applicant needed to take up in different proceedings

(which are now underway). For present purposes the respondent is entitled to

take the agent at face value in terms of any agreement reached within the

ostensible authority of the agent.

9. In the end there was not as much conflict in the evidence as first appeared,

because the respondent under cross-examination admitted that whilst he had the

consent of the agent for the improvements carried out, and to leave the

particular items in the premises on his departure, he did not have any agreement

to be compensated for any of this. The effect of this admission is that the

applicant is not entitled to recover the cost of removing the improvements, but

she is also not obliged to allow any credit for their value.

10. It became apparent during the course of the hearing that the respondent had

become bankrupt at some point. It then emerged that the date of bankruptcy

filing was 8 February 2012, and the date of discharge was 9 February 2015,3

making the respondent an undischarged bankrupt at the time of the tenancy. The

applicant was not informed by either the respondent or the agent of this. Further,

the respondent had dishonestly signed a declaration in his rental application

form that said he was not bankrupt.4

The history of the proceedings in the Tribunal

11. On 8 November 2017 the applicant commenced these proceedings in the

tribunal in the sum of $8,464.42, plus the tribunal filing fee of $150 and interest

of $1,750.97, giving a total claim of $10,365.39. This claim was comprised of:3 Australian Financial Security Authority National Personal

Insolvency Index Report4 Respondent’s Tenancy Application Form 30 May 2013 page 5

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(a) outstanding rent — $7,600;

(b) unpaid water bills — $21.42;

(c) cost for an antenna installed by the respondent at the property without the

applicant’s consent and incorrectly reimbursed to the respondent by the

agent from the applicant’s trust account — $250;

(d) locksmith charges for a lockout in June 2013 in which it is alleged that the

respondent locked himself out and should therefore bear that cost —

$143;

(e) cost of a gardening bill incorrectly paid from applicant’s trust account

instead of by the respondent — $231;

(f) cost of hanging a clothes dryer to the wall at the respondent’s request

incorrectly paid from applicant’s trust account instead of by the

respondent — $99;

(g) cost to repair the wall once the dryer was removed — $120;

(h) the tribunal filing fee — $150; and

(i) pre-judgment interest — $1,750.97.

12. The application annexed a number of documents, the most relevant being:

(a) a copy of the residential tenancy agreement between the applicant and

respondent which showed no non-standard terms;

(b) a Tenant Trust Ledger Report for the respondent’s tenancy;

(c) a signed Refund of Bond Form;

(d) an email from the agent to the applicant about finding a new tenant after

the respondent vacated;

(e) some water bills;

(f) an invoice from ‘Crystal Cleaning’ to Oz Property dated 22 March 2013

for $495 — the invoice has no ABN, no ACN and no individual’s name is

shown;

(g) invoices from Canberra Antennas, Advance Locksmiths, Oz Property,

Matticulous Gardens, and Equinox Property Maintenance Services;

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(h) an ingoing inspection report dated 20 June 2013 which contains the

notations “gardens + lawn not done” and “letterbox – Fallen down – needs

replacing” and refers to a range of other defects in the premises; and

(i) the pre-judgment interest calculation on the amount owed.

13. The matter was listed for a preliminary conference on 4 December 2017. There

was no appearance by the respondent. Orders were made for the parties to file

and serve submissions and evidence relied upon. These orders were amended on

25 January 2018 by consent, at the respondent’s request, to allow the respondent

additional time to file his response and evidence.

14. On 2 February 2018 the respondent filed his response in accordance with the

amended orders of 25 January 2018. The response disputed the applicant’s

claims, and claimed that the respondent had made “substantial improvements”5

to the property — including an air-conditioner, TV antenna, installed clothes

dryer, new fridge, and fencing and concreting — which he valued at $4,500.

He acknowledged rent credit of only $1,500. No counter-claim was filed by the

respondent in respect of the claimed improvements.

15. The respondent noted the amount of time that had elapsed between him vacating

the property and the claim being brought by the applicant. He claimed this had

caused him prejudice in terms of his memory of events and the survival of

relevant records. He said the property was “very run down”6 and in a “poor

state”7 when his tenancy commenced and that the applicant did little to fix

things during the tenancy. The respondent denied each of the applicant’s claims

and gave his reasons.

16. The response annexed:

(a) an invoice from GMT Fencing;

(b) an invoice from Downright Concreting;

(c) an invoice from Canberra Antennas; and

5 Respondent’s Response 2 February 2018 page 16 Respondent’s Response 2 February 2018 page 17 Respondent’s Response 2 February 2018 page 2

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(d) six photographs showing before and after views of the work undertaken

by the respondent at the property.

17. The applicant filed subpoenas to be issued to Oz Property to produce documents

and to Mr Andreas Has, director of Oz Property, to attend the tribunal to give

evidence. These subpoenas were issued on 14 February 2018.

18. On 19 February 2018 the applicant filed a reply to the respondent’s response of

2 February 2018. The applicant asserted that she had never been consulted about

rent credits for the air-conditioner, TV antenna, dryer, fridge, or fencing and

concreting. The applicant denied that she had authorised various maintenance

work, including to the paling fences and trees, or that the premises were in a

poor state of repair. The applicant indicated that the fencing and concreting

were of no use to the future tenants. She explained the delay in commencing

proceedings on the basis that she had been attempting to locate the respondent,

including in Melbourne, since mid-2016.

19. The applicant asserted that the rent arrears, plus lost rent until the new tenant

was found was $8,0008 (with no allowance for any of the credits claimed by the

respondent).

20. This response annexed:

(a) email correspondence between the applicant and the agent;

(b) a letter from the applicant to the respondent dated 9 September 2016;

(c) correspondence and pictures relating to the removal of the air-

conditioning unit;

(d) screenshots of the respondent’s LinkedIn page;

(e) Oz Property invoices; and

(f) an invoice dated 17 December 2014 from ‘Equinox Maintenance’ for

$110 for removing a fridge and washing machine from the rental

premises.

8 Applicant’s Reply to Respondent’s Response 19 February 2018 page 4 (‘Conclusion’)

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21. On 20 February 2018 the applicant attended the return of subpoena hearing for

the subpoena issued to Oz Property. The respondent was not present.

No documents were produced in response to the subpoena and the matter was

adjourned for 24 hours.

22. On 21 February 2018 the applicant again attended the tribunal for the return of

subpoena. The respondent was not present. The material produced included:

(a) a statement from the agent setting out his complaints about having to

respond to subpoenas on multiple occasions;

(b) a copy of the residential tenancy agreement showing a commencement

date of 7 June 2013 for 12 months, with no non-standard terms;

(c) statutory trust account statements from Westpac Banking Corporation

(that included private and confidential material);

(d) Oz Property documentation for the tenancy;

(e) an email of 24 October 2013 from the respondent to the agent asking

when the $3,000 rent credit for the fencing and concreting was going to

occur;

(f) an email of 8 January 2014 from the agent to the respondent saying that

only one week for rent would be allowed as the offset for the fencing and

concreting because the applicant did not expect the cost to be so high;

(g) an undated email from the agent to the applicant saying that a rent credit

of $1,500 had been allowed for the air-conditioner: the email said that the

respondent was in Melbourne, had lost his job and was bankrupt; and

(h) photographs of the property, purportedly from the final inspection.

23. On 21 February 2018 the applicant emailed the then Office of Rental Bonds

(now ACT Rental Bonds) to determine who was in possession of the bond paid

by the respondent. A response on the same day said that it had been released to

the agent and the cheque had been presented to the bank.9

24. On 23 February 2018 the matter came on for hearing before the Tribunal. The

applicant and respondent attended in person and the agent also attended. There 9 Exhibit 1

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was a general discussion in an attempt to define and narrow the issues.

The following relevant points emerged:

(a) The respondent and the agent were acquainted from the respondent’s

previous tenancy through the same agent.

(b) Neither the agent nor the respondent informed the applicant that the

respondent was an undischarged bankrupt when he entered the tenancy

agreement.

(c) The evidence from the agent was equivocal but appeared to admit that he

did not have permission from the applicant to allow the respondent the

various rent credits for the improvements except for the fence.

The applicant knew nothing of them and would not have consented.

(d) The agent said he had verbal approval regarding the fence but the

applicant denied this. The applicant further denied that she consented to

the $1,500 rent credit or knew anything of the email from the agent to the

respondent dealing with this issue.

(e) The applicant said that the lockout fee should be borne by the respondent,

as he had been given keys before he locked himself out.

25. The Tribunal explained to the parties that whether the respondent was entitled to

a rent credit for the cost of the improvements turned upon whether he had

permission from the lessor to do the improvements and agreement to the

reimbursements in the form of rent credits. In the present case, the existence of

that permission and agreement may turn on the actual or ostensible authority of

the agent to bind the applicant by permissions and agreements reached with the

respondent on behalf of the applicant.

26. An issue arose concerning the whereabouts of the remainder of the bond of

$1,000 paid by the previous tenant, and whether the agent had misappropriated

it. The agent insisted that the remainder of the bond was still held by the then

Office of Rental Bonds. The applicant denied this. The Tribunal adjourned the

matter and ordered the tribunal registry to contact the Office of Rental Bonds.

The tribunal registry contacted the Office of Rental Bonds but was advised that

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the Office of Rental Bonds was unable to assist with its enquiries other than to

confirm that a cheque for $1,000 had been sent to the agent.

27. On 6 March 2018, in accordance with the Tribunal’s directions of

28 February 2018, the agent provided redacted copies of the documents

produced under subpoena on 21 February 2018. He explained that the missing

$1,000 from the previous tenant’s bond was received by him and disbursed as

follows: $600 for the previous tenant’s end of lease cleaning; and $400 to the

respondent to reimburse him for the gardening and tidying cost paid by the

respondent to ‘Robb McCulloch Maintenance’ when the respondent moved in.

28. These annexed documents included:

(a) the Tenant Trust Ledger Report for the previous tenant;

(b) an invoice from ‘Crystal Clean’ dated 12 April 2013;

(c) the Trust Account Receipt for the Oz Property suspense account;

(d) evidence of a disbursement to the respondent to refund for ‘Garden Tidy’

costs;

(e) the Tenant Trust Ledger Report for Mark Vanner;

(f) an invoice from ‘Robb McCulloch Maintenance’;

(g) bank statements and records for the Oz Property trust account; and

(h) an invoice from ‘Equinox Property Maintenance Services’ dated

21 June 2013 for hanging a clothes dryer, replacing missing fence palings

and other work.

29. On 8 March 2018 the applicant made enquiries about obtaining access to

documents provided by the agent to the tribunal under a subpoena issued in

another matter involving the applicant. The agent was asked directly if he would

consent to the tribunal providing those documents to the applicant, and he

objected. Ultimately, the materials were made available to the parties by order

of the Tribunal dated 29 June 2018.

30. As noted above in paragraphs 22 and 28, on 21 February 2018 the agent

produced a number of documents in relation to the subpoena to Oz Property,

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with redacted versions of those documents provided on 8 March 2018. On 15

March 2018 the applicant wrote to the tribunal contending that the agent did not

produce all of the documents that he was required to produce under the

subpoena. This became a recurring issue.

31. On 17 April 2018 the applicant attended the return of a subpoena issued to

TICA Default Tenancy Control Pty Ltd at her request on 21 March 2018.

The respondent was not present. The documents produced were a letter

containing responses to the applicant’s requests, and the results of a database

search on the respondent.

32. On 20 April 2018 the Tribunal conducted a directions hearing in the matter.

Both the applicant and respondent attended in person. The Tribunal ordered the

agent to complete his compliance with the previous subpoena, and adjourned

the matter.

33. On 1 June 2018, and again on 20 June 2018, the applicant contacted the tribunal

to advise that the agent had failed to comply with the orders of 20 April 2018

and the subpoena to Oz Property.

34. On 22 June 2018 the applicant contacted the tribunal to request that the file for

another matter in which she was the applicant be made available to the member

for the upcoming hearing. This request was unable to be fulfilled.

35. On 26 June 2018 the respondent filed further submissions that advised, amongst

other things, that the cost of the air-conditioner in present day terms was $999

and that he paid a tradesman $250 to install it. He asked for credit for this cost

and the cost of the fencing he had installed.

36. The hearing resumed on 29 June 2018, with both parties appearing in person

and with the agent present. The applicant tendered the following documents:

(a) An email from the respondent to the agent dated 19 July 2013 attaching

photos of the fencing work he had undertaken at the property.

The respondent sought a rent credit for the cost of $1,650, with the

invoice from GMT Fencing attached.

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(b) An email from the respondent to the agent dated 20 August 2013 advising

he had paid $250 for a TV antenna which he had deducted from his rent

payment. In the same email the respondent advised that “Actsgl”

[ActewAGL] had given him notice to trim trees from power lines.

The respondent advised that he had arranged a gardener to come and do

the work for $120, inclusive of gardening in the front and back yards.

Photographs were attached. An email dated 8 September 2013 shows that

the final cost of the gardener was $231, which the respondent paid.

(c) Notices to Remedy, issued by the agent and dated as follows:

10 August 2013, for rent arrears of $457.12; 26 September 2013, for rent

arrears of $514.26; 15 November 2013, for rent arrears of $628.54;

10 December 2013, for rent arrears of $1,142.80; 3 January 2014, for rent

arrears of $857.10; and 4 February 2014, for rent arrears of $2,857.00.

(d) Termination Notices, issued by the agent and dated as follows:

10 October 2013, for rent arrears of $1,371.36; 22 November 2013, for

rent arrears of $1,771.34; 14 January 2014, for rent arrears of $1,542.78;

and 19 February 2014, for rent arrears of $3,769.98.

(e) An extract of the Tenant Trust Ledger Report for the period 7 June 2013

to 1 April 2014.

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(f) Extracts from Oz Property’s accounts showing, amongst other

transactions:

(i) a cash deposit of $800 by the respondent on 5 July 2013;

(ii) a cheque deposit of $800 on 15 August 2013 annotated “Mark

Vanner … Chq to ACT P/M”;

(iii) a cash deposit of $800 by the respondent on 14 September 2013;

(iv) a cash deposit of $800 by the respondent on 29 October 2013;

(v) a cheque deposit of $2,000 on 17 December 2013 annotated

“Cheque drawn for Mark Vanner to transfer payment…”; and

(vi) a cheque deposit of $1,600 on 1 April 2014 annotated “Bond Mark

Vanner”.

(g) Further extracts from Oz Property’s account showing:

(i) a payment of $143 to Advance Locksmiths on 12 December 2013

for a “[l]ocksmith service call”;

(ii) a payment of $495 to Crystal Cleaning on 1 April 2014 for “Full

Clean” of the rental premises;

(iii) a credit in the amount of $600 on 27 December 2013 for “Bond –

[previous tenant] Full House Clean”; and

(iv) six credits on 1 April 2014, in the total amount of $1,410.15, being:

three credits for water usage from 15 May 2013 to 14 November

2013 for Mark Vanner, in the total amount of $135.15; plus three

credits for “Bond Vanner” for “Full Clean House”, “Full Carpet

Clean” and “Garden Tidy and Furniture Removal”, in the total

amount of $1,275.

(h) An email of 30 May 2013 from the agent to the applicant informing her

that he had found “a good one” for a tenant, referring to the respondent.

(i) Documents relating to the previous tenancy at the same premises,

including a letter from the previous tenant to the tribunal dated

26 November 2013 complaining of delays in the agent processing her

bond claim, and a receipt for carpet cleaning dated 25 March 2013.

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(j) The following invoices and receipts:

(i) an invoice dated 2 November 2013, for $3,240, addressed to

“Bonke” and annotated “Paid Cheque 4/11/2013”, for an air-

conditioning system purchased from the ActewAGL Energy Shop;

(ii) a Sales Order dated 30 October 2013, for $722, addressed to

“Oz Property Real Estate”, for a stove purchased from The Good

Guys Fyshwick Pty Ltd;

(iii) a tax invoice dated 1 September 2013 for $231, addressed to

“Mark Vanner” and annotated “Paid 11/9/13”, for services provided

by Matticulous Gardens;

(iv) a tax invoice dated 16 July 2013, for $1,441, addressed to

“Mark Vanner” from Downright Concreting for “grey concrete”;

(v) an invoice dated 15 July 2013, for $1,650, addressed to

“Mark Vanner” from GMT Fencing for “1.5 high chainwire fence +

single gate”;

(vi) an invoice dated 28 June 2013, for $250, addressed to “Mark –

Narrabundah” from Canberra Antennas for “Supply and Installation

of Antenna”.

(k) ASIC searches for a company or business called ‘Crystal Cleaning’

showing no results for the Canberra region.

37. The agent was questioned about how he identified and contracted with Crystal

Cleaning. He said he could not now recall.

38. The respondent said that he had no questions to put to the applicant by way of

cross-examination of the evidence in her statements. The applicant then

commenced her cross-examination of the respondent.

39. The respondent said he knew nothing of the account for $400 paid out of the

previous tenant’s bond to the gardeners. He denied that he paid the amount to

‘Robb McCulloch Maintenance’ and then sought a reimbursement from the

agent.

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40. The respondent was taken to his Ingoing Condition Report, which is dated

17 June 2013, with his signature. The respondent was asked to note the

handwritten references to having installed the TV antenna and done the fencing

and concreting, and it was put to him that these works were not done until after

27 June 2013 so that either the date is wrong or the document has been later

annotated. The respondent had no answer.

41. The respondent was taken to his application for tenancy in which he nominated

“David Ayton” as his prior landlord. The respondent admitted that this was an

error and that Mr Ayton was in fact his flatmate at his previous tenancy and

moved into the present premises with the respondent for a few months.

The applicant knew nothing of this.

42. The same document contained a false declaration by the respondent that he was

not a bankrupt.

43. The respondent was shown letters in 2016 from the applicant to the respondent

to his parent’s home in Victoria marked “not at this address”. The respondent

said he was living there at the time and that the writing looked like his father’s

but that he — the respondent — never received the letters.

44. The respondent admitted that there was no agreement to him receiving

compensation for any of his improvements but he just hoped that the agent

could secure some.

45. The respondent could not recall how the gardener’s account rose from $120 to

$231 and what actual work was done.

46. The respondent could not recall the circumstances of the lockout that gave rise

to the locksmith charge.

47. It was put to the respondent that he ceased paying rent in December 2013 but

still remained in occupation until March 2014. The respondent agreed that he

left the premises in March 2014.10 He said that he left the fridge in the premises

when he left, although he denied that he had actually sold the fridge to the

agent.10 Transcript of proceedings 29 June 2018 page 20

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48. Mr Haas, the agent, was sworn in and gave evidence. He said that he allowed

the respondent $400 rent credit for the cleaning done by ‘Robb McCulloch

Maintenance’ when the respondent moved in. Mr Haas said that the outgoing

tenant had failed to clean and Oz Property did not have the funds in trust to have

the cleaning done between the two tenancies. He was questioned on the efforts

he had made to identify and contact Mr McCulloch and the absence of any ABN

or ACN on the invoice from ‘Robb McCulloch Maintenance’. He had no answer

for the payment of the invoice. He assumed that the respondent had paid the

account and was seeking reimbursement.

49. The agent was cross-examined on the Ingoing Condition Report and the

inconsistency between the date of the document and the hand-written entries

concerning the TV antenna and fencing that could only have been inserted later

in time. It was put to him that he had amended the document at some later point

in time. The agent denied this.

50. The agent was cross-examined on the dating of the photographs said to show the

state of the premises when the previous tenant vacated. There did not appear to

be any systematic way of recording this data in the agent’s office. A comparison

of the photos said to relate to the end of previous tenant’s tenancy, the

beginning of Mr Vanner’s tenancy and the end of Mr Vanner’s tenancy all

appear to be the same photos.

51. The agent was cross-examined on whether he obtained permission to spend

$120 on the gardener to remove the trees from the overhead wires and, if so,

why he had authorised payment in the amount of $231. He said it seemed a fair

price.

52. The agent said that his firm had personally purchased the fridge from the

respondent and it had remained in situ for the next tenant. The payment was

made to the respondent only after the end of the ensuing tenancy. The fridge is

now at the agent’s office. The same is apparently true of the washing machine.

53. The applicant put to the agent that the cost of the lockout in June 2013 was one

that should have been borne by the respondent. The respondent said that the key

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he had been given did not work the main wooden front door. It was not a

question of having lost the key.

54. In the course of her questioning, the applicant asked questions going to the

credit of the agent. The Tribunal pointed out that the present claim concerns the

state of indebtedness of Mr Vanner to the applicant and does not involve any

claim by the applicant against the agent for any alleged breach of contract with

her. Any such claim would be a separate matter.

55. Orders were made for the tribunal to recover a related file from archives and to

make it available to the parties. Orders were then made for the applicant to file

any further submissions by 20 July 2018 and the respondent by 3 August 2018,

after which the matter would be finalised on the papers without further hearing.

56. On 3 July 2018 the related file11 was retrieved from archives and made available

to the parties for inspection. The applicant arranged to view the file.

57. On 20 July 2018 the applicant provided her final submissions to the Tribunal.

The applicant submitted a summary of her claim of $8,411.13 plus the tribunal

filing fee of $150, with supporting documents. The claim was as follows:

(a) $7,485.71 for rent from 27 December 2013 to 6 May 2014 inclusive, with

a denial that the respondent was entitled to any rent credit or set-off for

the improvements done. The applicant annexed detailed calculations and a

rent ledger which appears to be accurate and is allowed.

(b) $400 reimbursement for the misuse of the previous tenant’s bond to

reimburse the respondent (in the form of a rent credit applied on

9 November 2013) for the cost of cleaning and tidying paid to ‘Rob

McCulloch Maintenance’. The applicant noted that, at the hearing, the

respondent stated that he knew nothing of this account or work done. The

agent asserted that the cleaning was required following the termination of

the previous tenancy and the $400 came from the previous tenant’s bond.

Plainly if the work was never done and the amount never paid to

‘Robb McCulloch Maintenance’, then the respondent should never have

been reimbursed out of money that belonged to the applicant. On the other

11 XD 1020/2013

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hand, if the work was done and Mr McCulloch was paid, then

Mr McCulloch was entitled to the payment. Given the existence of the

invoice and no complaint of non-payment from Mr McCulloch, then

either Mr McCulloch was paid (by someone other than the respondent) or

the invoice is fraudulent. If the amount was paid direct to Mr McCulloch,

then the money should not have been reimbursed to the respondent, given

that the respondent is sure that he did not pay the bill. If it was a

fraudulent invoice, then again the respondent has no right to the amount.

On balance, the money belongs to the applicant and her claim on this

point is allowed.

(c) $400 reimbursement for the rent credit applied on 27 December 2013 for

the fencing and concreting done by the respondent. The applicant denies

that she authorised any rent credit for the fencing and concreting. The

applicant says that the email of 8 January 2014 from the agent to the

respondent informing him of the one week’s rent credit was never

discussed with her and was sent without her authority. The applicant

correctly points out that in evidence the respondent said that he had no

agreement to do any of the improvements except the fences and

concreting, and that he had no agreement or expectation of being

reimbursed for any of the improvements including the fencing and

concreting. This issue is further addressed below but the applicant’s claim

on this point is allowed, noting that this amount is included in the amount

allowed under paragraph (a), above.

(d) $111, being the difference between the original quote and the final invoice

for the gardening work relating to the trees in the power lines. (The full

amount of $231 was applied as a rent credit on 11 September 2013.)

The applicant is prepared to reimburse the original quote of $120 to clear

the power lines. The additional $111 appears to be due to the gardener

doing gardening work that was the respondent’s responsibility, assuming

that the garden was in a reasonable state of repair at the commencement of

the tenancy. The Ingoing Condition Report of 7 June 2013 notes “gardens

+ lawns not done”, while the Inspection Report of 20 June 2013 says

“[g]ardens and lawns need redoing”. However, the final inspection for the

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previous tenant notes “Lawn/Garden Tidy”12 and the order of the Tribunal

on 4 December 2013 concerning the previous tenant’s bond makes no

reference to the need for gardening. It is common ground that the yard

was basic and that the respondent, and prior tenants, had dogs. It may be

that the gardens and lawns needed redoing to bring them to a better

standard but this does not make the state of them ‘unreasonable’. The

respondent takes the gardens and lawns in the state he agreed to and then

takes on the responsibility to maintain them in that state.13 It was not for

the applicant to fund the respondent’s ongoing obligation. The additional

sum should not have been paid to the respondent and is repayable.

(e) $143 reimbursement for the locksmith charge for the lockout. The

applicant asserts that the cost arose because the respondent lost the key he

had been provided. The respondent said he did not recall the event with

any clarity but thought it was the case that the key he had been provided

did not work, rather than that he had lost the key. The applicant’s case is

pure assertion and she has no first hand evidence of the event. If the key

provided did not work then the respondent was entitled to a replacement.

If he needed the locksmith to change the lock then that is the lessor’s

cost.14 This part of the applicant’s claim is not made out.

(f) $219 reimbursement for the costs of hanging and removing the dryer.

The applicant unknowingly paid $99 via her agent for the cost of hanging

the dryer on the wall and the further cost of $120 to later remove it and

patch the wall. The dryer belonged to the respondent who claims credit for

leaving the dryer in the premises. There was no agreement for

compensation and this matter is further addressed below. The agent gave

consent for the dryer to be hung and paid for it. This issue is further

addressed below, but the outcome is that the respondent was entitled to

rely on the agent’s authority to hang the dryer at the applicant’s cost. This

part of the applicant’s claim is dismissed.

12 Tenants Final Check Out Report for previous tenant undated page 1

13 RTA standard terms 63(c) and 6414 RTA standard term 54

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(g) The applicant submitted that washing machine was of no value, soon

broke down and there was no agreement for compensation to the

respondent for leaving it behind when he vacated. This is consistent with

the evidence. No rental credit was applied by the agent for the washing

machine and no rental credit is allowed by the Tribunal.

(h) $400 reimbursement for the week’s rent credit actually given for the

fridge (applied on 19 February 2014.). The applicant submits that there is

no evidence, other than that the respondent abandoned the fridge when he

left it behind. The respondent denied that he sold the fridge to anyone,

including to the agent. He said the fridge was left in lieu of unpaid rent.

The fridge is now in the agent’s office. The applicant denies any

knowledge or agreement to reimburse the respondent in rent credit for

leaving the fridge. The respondent in evidence said that he had no actual

agreement to this effect and just hoped for some credit. This issue is

further addressed below but the applicant is entitled to succeed on this part

of her claim, noting that this amount is included in the amount allowed

under paragraph (a), above.

(i) $21.42 for water usage — the respondent did not contest this issue.

(j) $250 reimbursement for the rent credit actually given for the TV antenna

(which was applied on 30 August 2013). The applicant says that there was

no antenna at the property at the start of the tenancy and agrees that the

respondent installed the antenna at the cost of $250. The applicant submits

that the absence of an antenna does not make the property uninhabitable

or not in a reasonable state of repair. If the respondent wanted an antenna,

then he needed to obtain consent from the applicant and fund it himself.

He did neither. The agent gave evidence that he did give consent to the

respondent to install the antenna but not for the rent credit. The

respondent agreed that there was no agreement for the week’s rent credit

and that he deducted the $250 from his rent payment. These issues are

addressed further below but the applicant is entitled to succeed on this part

of her claim.

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(k) Interest, at the pre-judgment rate, on any amount awarded by the Tribunal.

Interest on any amount of compensation ordered by the tribunal is not

routinely awarded in the residential tenancies jurisdiction of the tribunal.

The rules on claims for interest under the ACT Civil and Administrative

Tribunal Procedural Directions 2010 (No 1) are limited to civil dispute

applications.15 Interest is not awarded in this matter.

58. On 3 August 2018 the respondent provided a two page document of final

submissions to the Tribunal. The response included:

(a) comments on the applicant’s conduct during the proceedings;

(b) information about the respondent’s financial difficulties at the end of the

tenancy;

(c) an assertion that he had spent over $4000 in all making improvements to

the property which he left behind as an expression of his “goodwill”; and

(d) comments expressing frustration about the four year delay in the applicant

bringing her claim.

59. On the same day the applicant advised the tribunal that the respondent’s

submissions contained new material to which she objected.

Consideration of the issues

60. The respondent entered bankruptcy before the commencement of this tenancy

and deliberately refrained from noting this fact on his rental application. In fact,

he ticked the box to declare the contrary. It seems that the agent knew of the

bankruptcy at some point in time, but it is not clear when he obtained that

knowledge. The agent was the agent for the respondent’s former tenancy, during

which time the respondent did enter bankruptcy.

15 ACT Civil and Administrative Tribunal Procedural Directions 2010 (No 1), procedural direction 31

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61. The debts, including rental debts, of the respondent are not enforceable against

him after bankruptcy but the rental debts accruing during the bankruptcy are

enforceable against him.16 In the present case, all the rent debt post-dated the

bankruptcy and so are enforceable against the respondent.

62. This does not dispense with the dishonesty of the respondent in deliberately

lying about his bankruptcy and this deception is a breach of section 52 of the

RTA. Had the applicant known of this fact, she may have instructed her agent to

decline the respondent’s tenancy application. Had the agent known of this fact,

he was duty bound to convey this information to the applicant before accepting

the respondent’s tenancy.17

63. The Tribunal is satisfied on the evidence that the agent gave the respondent

permission to install the air-conditioner, the dryer, the TV antenna, fencing and

concreting. The Tribunal is not satisfied that the agent gave the respondent any

undertaking on the applicant’s behalf or otherwise that the respondent would be

compensated for any of these improvements.

64. It is trite law that a tenant cannot undertake such improvements without the

lessor’s consent and that any fixtures left behind at the end of the tenancy

become the lessor’s property. Standard terms 64, 65, 67 and 68 of Schedule 1 to

the RTA provide as follows:

64 The tenant must leave the premises—

(a) in substantially the same state of cleanliness, removing all the tenant's belongings and any other goods brought onto the premises during the duration of the tenancy agreement; and

(b) in substantially the same condition as the premises were in at the commencement of the tenancy agreement, fair wear and tear excepted.

65 The lessor must not require the tenant to make alterations, improvements or renovations to the premises.

67 The tenant must not make any additions or alterations to the premises without the written consent of the lessor.

16 Allan Anforth, Peter Christensen and Christopher Adkins, Residential Tenancies Law and Practice New South Wales (The Federation Press, 7th

edn, 2017) (Residential Tenancies Law and Practice) [2.88.2]17 Residential Tenancies Law and Practice [2.3.4]

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68 (1) The tenant must not add any fixtures or fittings to the premises without the consent of the lessor.

(2) The lessor's consent must not be unreasonably withheld.

(3) The tenant must make good any damage to the premises on removal of any fixtures and fittings.

(4) Any fixtures or fittings not removed by the tenant before the tenant leaves the premises becomes the property of the lessor.

65. The present case raises the issue of whether the applicant’s consent was given

via her agent. The applicant denied that the agent ever addressed the issues with

her and consequently that she personally gave no such consent. That does not

dispose of the matter. When the owner engages an agent to act on their behalf,

the tenant is entitled to take the agent at face value in relation to those

representations that usually fall within the ambit of an agent’s activities, absent

any notice by the tenant of bad faith on the agent’s part (‘the ostensible

authority’ of the agent).18

66. It is usually part of an agent’s responsibility to give or refuse permission for

tenant improvements. The tenant does not have to go behind the agent’s

appointment and take the matter up directly with the lessor. In the present case,

the respondent had the consent to do the improvement from the agent and had

no notice that the agent had not taken the matter up with the applicant. In fact,

the emails from the agent to the respondent indicated to the contrary.

67. There is no breach in the respondent having carried out these improvements and

so the applicant’s claim for the cost of removing them is disallowed.

68. Any discontent on the applicant’s part concerning the unauthorised consent

given by her agent is a matter between the applicant and the agent and does not

impact on the tenant’s rights.19

69. However, the agent’s consent to the improvements does not automatically carry

with it the promise of compensation during or at the end of the tenancy. This is

a matter that needs to be negotiated between the parties before the

improvements are done. If the actions and conduct of the lessor encourages a

belief in the tenant that compensation will be allowed, then the tenant may have 18 Residential Tenancies Law and Practice [2.3.4]19 Residential Tenancies Law and Practice [2.3.4]

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a restitutionary claim against the lessor for the value of the improvements.20 In

the present case, no such encouragement was forthcoming from the applicant or

the agent and the respondent testified that he had a mere hope that he might be

allowed something by way of rent credit. In these circumstances the claim by

the respondent for a set-off for the improvements must fail.

70. The Tribunal is satisfied that the agent was aware of, and accepted on behalf of

the applicant, the dryer, washing machine and air-conditioner left behind by the

respondent. The Tribunal is not satisfied that the agent gave any undertaking to

the respondent to pay him for these items. The actions of the respondent are

consistent with guilt for the lengthy non-payment of rent and the urgency with

which he departed the premises.

71. The applicant is entitled to succeed on those parts of her claim as outlined at

paragraph 57 above in the sum of $8,418.13.

72. The respondent is not entitled to succeed on any part of his claimed set-offs.

73. The respondent complained of the delay in the applicant bringing the

proceedings. This delay has not given rise to any additional items of claim,

including interest. It has not caused the respondent any prejudice beyond that of

finding receipts and recalling events.

74. The delay was caused by the respondent’s sudden departure with no forwarding

address. The applicant did pursue him during mid-2016 but her correspondence

and phone calls were not returned. In the meantime, the applicant has been

engaged in a protracted dispute with the agent.

75. There may have been some unjustified delay on the applicant’s part but when

this is weighted against the deliberate choice of the respondent:

(a) to deny his bankruptcy status;

(b) not to contact the applicant (or the agent) from the time of his urgent

departure knowing he had left a large rental debt behind;

20 Residential Tenancies Law and Practice [2.68.1]

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(c) his deliberate misrepresentation in his tenancy application of Mr Ayton,

former flatmate, as his former lessor and referee; and

(d) the length period that he remained in the premises without the payment of

any rent;

there is little merit in the respondent’s complaint.

………………………………..Senior Member A Anforth

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HEARING DETAILS

FILE NUMBER: RT 932/2017

PARTIES, APPLICANT: Juanita Bonke

PARTIES, RESPONDENT: Mark David Vanner

COUNSEL APPEARING, APPLICANT N/A

COUNSEL APPEARING, RESPONDENT N/A

SOLICITORS FOR APPLICANT N/A

SOLICITORS FOR RESPONDENT N/A

TRIBUNAL MEMBERS: Senior Member A Anforth

DATES OF HEARING: 29 June 2018

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