Belle v Chief Executive, Department of Justice and Attorney-General – Office of Fair Trading & Ors [2023] QCAT 439

QUEENSLAND CIVIL AND ADMINISTRATIVE TRIBUNAL CITATION: Belle v Chief Executive, Department of Justice and Attorney-General – Office of Fair Trading & Ors [2023] QCAT 439 PARTIES: BELLE (applicant) v CHIEF EXECUTIVE, DEPARTMENT OF JUSTICE AND ATTORNEY-GENERAL – OFFICE OF FAIR TRADING ABSTAR ENTERPRISES PTY LTD CAN 616 256 510 T/AS RAY WHITE KIRWAN NICOLA YVONNE FAULKS AMRITA SINGH COURTNEY AFU (respondents) APPLICATION NO/S: GAR225-22 MATTER TYPE: General administrative review matters DELIVERED ON: 30 October 2023 HEARD AT: On the papers DECISION OF: Member Goodman ORDERS: The decision under review is confirmed. CATCHWORDS: GENERAL ADMINISTRATIVE REVIEW – where landlord applicant alleges misconduct by real estate agent managing a rental property – where provisions of legislation do not allow for a claim Agents Financial Administration Act 2014 (Qld), s 6(2), s 77(b)(ii), s 82(1), s 103 Queensland Civil and Administrative Tribunal Act 2009 (Qld), s 24 Peter &Anor v Tyson [2015] QCATA 9 Zarben Developments Pty Ltd v Martinger Pty Ltd & Ors [2013] QCAT 22 -- 1 of 6 -- 2 APPEARANCES & REPRESENTATION: This matter was heard and determined on the papers pursuant to s 32 of the Queensland Civil and Administrative Tribunal Act 2009 (Qld) REASONS FOR DECISION BACKGROUND [1] These reasons contain a summary of the relevant facts and submissions made by the parties. It is not a restatement of everything provided to the Tribunal. It is quite outside the scope of these reasons to recount in full the contents of all of the documents before the Tribunal. [2] In 2021, the applicant owned a property which was leased to tenants. At the relevant times, Ray White managed the property lease on the applicant’s behalf. [3] In October 2021, the tenants vacated the property and sometime around 19 or 20 October 2021, Ray White inspected the property and prepared an Exit Condition Report at the applicant’s request. [4] On 20 October 2021, the applicant terminated Ray White’s appointment as her property manager. She moved into the property on 25 October 2023. [5] The applicant claims that the Exit Condition Report was not properly completed. [6] On 23 December 2021, the applicant lodged a claim with the Office of Fair Trading seeking a payment of $25,000. She stated in the accompanying letter, dated 22 December 2021, “I am making a claim for financial loss as a result of Ray White Kirwan being incompetent, acted in an unprofessional way and made false misleading statements”. [7] On 27 April 2022, the Chief Executive rejected the claim on the basis that Ray White had not committed a “claimable event” as defined in the Agents Financial Administration Act 2014 (Qld). [8] On 23 May 2022, the applicant lodged an application in this Tribunal seeking review of the decision to reject the claim. She claims that these circumstances fall within s 82(1)(b) of the Act because Ray White “misapplied the Exit Condition Report for the purposes of evidence”, and the main object of the Act is to protect consumers from financial loss in dealings with agents. [9] The Act provides that decisions of the Chief Executive may be reviewed in this Tribunal.1 This is a fresh hearing on the merits, not an appeal, and the Tribunal must determine the correct and preferable decision. Neither party bears an onus of proof. The Tribunal may either confirm, amend or set aside the decision.2 [10] The Act sets up a scheme whereby claims may be made against a fund administered by the Office of Fair Trading. The Object of the Act is to enable persons to claim 1 s 77(b)(ii) and s 103 Agents Financial Administration Act 2014 (Qld). 2 s 24 Queensland Civil and Administrative Tribunal Act 2009 (Qld). -- 2 of 6 -- 3 against the fund in particular circumstances where they have incurred financial loss arising from dealings with agents.3 [11] The legislation (relevantly) states as follows: S 82(1) A person may claim against the fund if the person suffers financial loss because of the happening of any of the following events— (a) … (b) a stealing, misappropriation or misapplication by a relevant person of property entrusted to the person as agent for someone else in the person’s capacity as a relevant person… [12] The applicant contends that s 82(1)(b) applies and she is entitled to claim against the fund. She has not particularised the financial loss she claims to have suffered. SUBMISSIONS BY THE PARTIES [13] The applicant submits that: (a) Ray White provided her with incorrect information about the notices required when giving the previous tenants notice to leave. Further, staff provided their views on a likely outcome if proceedings were brought in this Tribunal relating the recovery of rental arrears and seeking a warrant of possession, and this information was incorrect. (b) Ray White failed to act according to her instructions, provided incorrect evidence to the Court, and acted in a way that was irresponsible, incompetent, unprofessional and they provided detrimental, false and misleading information to her. In acting as they did, Ray White breached legislative provision. (c) She was advised by the Residential Tenancies Authority Queensland that information provided by Ray White to her was incorrect. (d) The Exit Report completed by Ray White at the end of the tenancy was incomplete and inaccurate. Due to multiple errors and omissions in the document “the credibility of the entire document … must be questioned.” The exit report was in the form of a template which autofilled some boxes, making the document inaccurate, and difficult for her to rely on should she have wanted to take proceedings against the tenants. (e) She is making a claim pursuant to s 82(1)(b) as a result of Ray White’s “misapplication of the Exit Condition Report”. (f) The Exit Report is “property” and she is “someone else” as described in s 82(1)(b). The Exit Report is property because it is a document. It is “tangible while also creating a present and future legal and equitable vested interested in property”. It can be submitted in evidence in disputes between parties. An Exit Report “proves the existence of a legal and invested interest in a property by owner or owner’s agents and tenants”. Once the Exit Report is prepared and 3 s 6(2) Agents Financial Administration Act 2014 (Qld). -- 3 of 6 -- 4 paid for, it becomes the property of the party who engaged the services of the third party engaged to undertake and prepare the report. (g) She is “someone else” in the sense that she is a person who entrusted to a person, as an agent, their property, in the person’s capacity as a relevant person. (h) The Tribunal should follow the decision of Peter & Anor v Tyson [2015] QCATA 9: “…the Property Agents and Motor Dealers Act deals with many issues. If an agent breaches the Act, there are penalty provisions. If there is a loss, the Claims Fund may respond to, and pay, that loss to a consumer. The Claim Fund, however, is directed to loss through fraud, stealing or misappropriation or malfeasance. It does not respond to claims for negligence or breach of contract.” (i) Her claim is that Ray White misapplied the Exit Condition Report. She suffered loss because of misapplication and / or wrong doing by Ray White, and “malfeasance is considered payable through the Claim Fund while breaches of an Act may attract penalties”. (j) She has experienced a number of issues when attempting to obtain reports, quotes and /or have work carried out, and so has not been able to provide evidence to quantify her loss. (k) There is no requirement under the legislation for the Tribunal to find that Ray White’s conduct caused damages she sustained in order for her claim to be successful. (l) As a result of the misapplication of the Exit Condition Report, any financial loss due to damage caused by the tenants would be unclaimable as Ray White failed to accurately record the condition of the property at the time the tenants left the property. (m) The Tribunal should consider an order be made requiring the Chief Executive to investigate Ray White. This request is “based on the concerns raised by Belle in relation to evidenced contraventions of various Acts, general operating practices in Ray White’s role of agents and possible practices of misappropriation and misallocation of funds.” (n) Ray White may have altered images in a photograph attached to a report. She has identified pixel colour variation in the photograph. (o) During the discovery process it has become apparent that there are concerning issues in the way Ray White dealt with the collection and disbursement of monies paid by the tenant sometime after 19 October 2021, and “it also appears that Ray White has misappropriated and / or misallocated funds.” (p) She holds concerns about the collection and disbursement of money at the end of the tenancy: (i) She was overquoted and overcharged for the cost of lodging proceedings in QCAT; and (ii) It is unclear how the bond return was calculated, and whether locksmith and other expenses were properly taken into account. The explanation -- 4 of 6 -- 5 provided by Ray White is false and misleading. Alternatively, the financial records of Ray White are inaccurate, false and misleading. [14] The Chief Executive submits that: (a) s 82(1)(b) does not apply because the preparation and issuance of the Exit Report is not “property”; (b) Even if there was “property”, it was not entrusted to a person as agent for someone else in the person’s capacity as a relevant person; (c) Ray White was acting as agent for the applicant, not for someone else; (d) Even if Ray White failed to do its job, provided poor service, breached the terms of its appointment and/or breached a duty of care owed to the applicant that was incomplete or wrong, none of these would trigger the operation of the fund as these are not claimable events listed in s 82(1);4 (e) The Tribunal should follow the decision in Zarben Developments Pty Ltd v Martinger Pty Ltd & Ors [2013] QCAT 22, where the Tribunal found: “An owner is responsible for the maintenance and repair of the tenancy. If the tenant caused the damage, the owner may be able to recover from the tenant. If the damage occurred because the agent was negligent in the way it managed the property, the owner may have a claim against the agent. But the owner has no claim against the fund.” (f) In any event, the applicant has not provided evidence (such as quotes, invoices or reports from tradespeople or qualified building inspectors) that the property sustained substantial damage or that it would cost her clamed amount of $25,000 to repair any such damage. Further, there is no evidence that any such damage was caused by Ray White. DOES SECTION 82(1)(b) APPLY? [15] There is insufficient evidence to make a finding of stealing or misappropriation. [16] The applicant claims that the employees misapplied property. I note that the applicant raised concerns that employees of Ray White failed to properly explain to her how the return of bond payments were calculated. There is insufficient evidence to make a finding that any of the funds were misapplied by the employees. [17] The legislation refers to an “event”. It is not clear what event the applicant is claiming to have occurred that would trigger the application of s 82(1). [18] The applicant claims that the Exit Report was misapplied. This seems to be on the basis that the document is “property” which Ray White held on her behalf as her agent. [19] I have had regard to Peter &Anor v Tyson [2015] QCATA 9, which is referred to by both parties. That case referenced the position under the previous legislation – the Property Agents and Motor Dealers Act 2000 (Qld). The reference to the legislation applying in cases of “fraud, stealing or misappropriation or malfeasance” does not 4 Peter &Anor v Tyson [2015] QCATA 9; Bailey, P & S v Coventry MJ, Cowan PS & Kangacove Pty Ltd (Deregistered) [2007] QCCTPAMD 48, Garwood v Tiralees Pty Ltd and Ors [2012] QCAT 541; Murphy H v Hancock D and Taylor JM t/as Montville, Mapleton &Maleny Real Estate [2004] QCCTPAMD 10. -- 5 of 6 -- 6 reflect the wording of the current Act, which refers to “stealing, misappropriation or misapplication” only. Accordingly, it is not necessary in this case to consider whether there was any malfeasance. The comments of Senior Member Stilgoe, sitting in the appeals jurisdiction of this Tribunal, are, however, useful. She states that the fund “does not respond to claims for negligence or breach of contract”. That remains true under the current legislation. [20] The applicant has lodged extensive submissions and I note that she has taken issue with the first respondent’s previous attempts to summarise her position. Doing the best that I can, it seems that the gist of the applicant’s case is that the Exit Report was incomplete / inaccurate and that staff at Ray White acted in a way that was irresponsible, incompetent, unprofessional and they provided detrimental, false and misleading information to her. [21] Even if I find that the staff acted in the way alleged by the applicant, the provisions of s 82(1)(b) do not apply. The applicant has no claim against the fund in those circumstances because they do not support a finding of stealing, misappropriation or misapplication. [22] Further, a finding that the Exit Report was deficient cannot support a finding of stealing, misappropriation, or misapplication. It may possibly give rise to a claim against the agent, and there may perhaps be a claim against the tenant if they caused damage, but there is no claim against the fund.5 [23] The Tribunal sitting in its review jurisdiction has no power to order the Chief Executive to investigate Ray White. [24] Accordingly, the decision under review is confirmed. 5 Zarben Developments Pty Ltd v Martinger Pty Ltd & Ors [2013] QCAT 22. -- 6 of 6 --