Eising v Westgarth Realty Pty Ltd [2019] QCATA 120

QUEENSLAND CIVIL AND ADMINISTRATIVE TRIBUNAL CITATION: Eising v Westgarth Realty Pty Ltd [2019] QCATA 120 PARTIES: LINDY MAREE EISING (applicant/appellant) v WESTGARTH REALTY PTY LTD (respondent) APPLICATION NO/S: APL301-18 ORIGINATING APPLICATION NO/S: MCDT 15/18 MATTER TYPE: Appeals DELIVERED ON: 2 August 2019 HEARING DATE: 27 March 2019 HEARD AT: Brisbane DECISION OF: Justice Carmody ORDERS: 1. Extension of time to file leave to appeal granted. 2. Leave to appeal granted. 3. Appeal dismissed. CATCHWORDS: APPEAL – LEAVE TO APPEAL – MINOR CIVIL DISPUTE – RESIDENTIAL TENANCY – where tenant agreed to special conditions for professional carpet cleaning and pest control at the end of the term – where she defaulted contending they were against the law – where a bond release order made in lessor’s favour – whether leave to appeal should be granted – whether appeal should be allowed. Queensland Civil and Administrative Tribunal Act 2009 (Qld) s 13 Residential Tenancies and Rooming Accommodation Act 2008 (Qld) ss 53(1), 54, 171, 188, 216 Residential Tenancies Authority v Vespar Pty Ltd t/as Coral Sea Property Management (unreported, Mag Ct Townsville, 00208456/17(2); 00208452/17(7); 00208426/17(6); 00208468/17(1), 22/03/2018). -- 1 of 5 -- 2 APPEARANCES & REPRESENTATION: Applicant: Ms Eising by phone Respondent: Mr GM Westgarth, Westgarth Realty Pty Ltd in person REASONS FOR DECISION [1] The applicant tenant was late filing so needs an extension of time as well as leave to appeal. [2] The proposed ground is, in effect, that an adverse bond release order under the Residential Tenancies and Rooming Accommodation Act 2008 (Qld) (RTRA Act) is not a just and equitable one for resolving a tenancy dispute within s 13 Queensland Civil and Administrative Tribunal Act 2009 (Qld) (QCAT Act) because of interpretative or application error. The context [3] The applicant rented residential premises through the respondent agent. Carpets were professionally cleaned and the dwelling fumigated before entry. During the six (6) months term she kept four (4) inside dogs and a pet budgie. [4] Section 188(4) RTRA Act as well as clause 37 of the general terms of agreement (GTA) obliged the applicant to leave the premises and inclusions (that is, anything left for the tenant’s use), as far as possible, in the same condition they were in at the start, fair wear and tear excepted. [5] Also, under special conditions 1 and 3 she specifically “...acknowledges the carpets are to be professionally cleaned at the end of the tenancy or every 12 months” and “the premises to be fumigated by a professional fumigator”. [6] Using specialist trade products from Bunnings the applicant chemically cleaned the carpets and treated the premises for pests before vacating but refused to comply with the special conditions based on legal advice that outgoing tenants in Queensland cannot be forced to pay for professional services or use a particular supplier. [7] The respondent filed a minor civil dispute application on the lessor’s behalf for breach of end of tenancy terms claiming, among other things, reimbursement of the cost of the agreed services. [8] The tribunal made no specific findings but enforced the special conditions as reasonable and in-line with trade practice. The Residential Tenancies Authority (RTA) was ordered to pay the claimed amount from the security bond and refund the balance. The leave discretion [9] Professional bond cleaning and pest control conditions are common in Queensland but in New South Wales a term having the effect that a leaving tenant must have the carpet professionally cleaned, or pay for the cost of it, cannot be included in the agreement except where pets have been kept on the premises. -- 2 of 5 -- 3 [10] As I understand the situation in Tasmania the exit condition of carpets must be the same as the start so if it was professionally cleaned on the way in it should be professionally cleaned on the way out. In Victoria carpets need not be professionally cleaned unless it is a term of the lease. A professional carpet cleaning clause is only enforceable in the Australian Capital Territory if the carpet was professionally cleaned prior to the commencement of the lease. [11] Goods and services conditions are unenforceable in South Australia but a landlord in Western Australia can legally require a tenant to have their carpet professionally cleaned on vacating as a term of the lease. Whether a tenant in the Northern Territory is required to steam clean the carpets when vacating depends on a comparison of the entry condition report with the exit report, considering fair wear and tear and an objectively reasonable level of cleanliness. [12] According to RTA figures something like 240,000 tenancy bonds are refunded with more than 260,000 new ones lodged in Queensland every year and around 64 per cent of all QCAT disputes are over rental bond releases.1 [13] As there is ongoing uncertainty about the validity of professional carpet and pest conditions in residential tenancy agreements and the stated object of the QCAT Act is to ensure that tenancy laws are applied consistently and that like cases are treated alike it is desirable for the appeal tribunal to make a considered statement on the issue. [14] To facilitate that the procedural time limit for applying for leave to appeal is extended as necessary and leave to appeal granted. Supply of goods and services [15] Section 171(1) RTRA Act forbids lessors and agents from compelling prospective tenants to buy goods and services from either them or someone else as a condition of accepting their tenancy application. The ban is plainly aimed at stopping lessors or agents from directing business to themselves or getting kickbacks from favoured suppliers and protecting vulnerable consumers against predatory trade practices. [16] It potentially operates where agents give application forms containing standard non- negotiable goods and services terms to legally unsophisticated tenants unaware that they become bound immediately on acceptance of the completed application by the lessor. [17] In Residential Tenancies Authority v Vespar Pty Ltd t/as Coral Sea Property Management,2 for example, a property management agency in Townsville was fined $6,000 for routinely inserting a special condition mandating dry-cleaning of carpets, curtains and blinds by a registered professional to the satisfaction of the lessor/agent upon vacating. [18] However, on its preferred reading, s 171(1) RTRA Act is not intended to stifle fair bargains and does not prohibit any goods and services agreements between lessors 1 Residential Tenancies Authority v Vespar Pty Ltd t/as Coral Sea Property Management (unreported, Mag Ct Townsville, 00208456/17(2); 00208452/17(7); 00208426/17(6); 00208468/17(1), 22/03/2018). 2 (unreported, Mag Ct Townsville, 00208456/17(2); 00208452/17(7); 00208426/17(6); 00208468/17(1), 22/03/2018). -- 3 of 5 -- 4 and tenants. That intention would have been signalled by a full stop inserted after “someone else”. Nor is there any assertion in this case that acceptance of the appellant’s tenancy application was contingent on the special conditions being agreed to. For this reason, its possible application on different facts is not considered in any depth. Nominated suppliers [19] Lessors may designate a person to arrange or make emergency repairs of the premises or inclusions under s 216 RTRA Act and can require the tenant to buy goods and services, including professional carpet cleaning and pest control, without committing RTRA Act offences, if (except for utilities) they do not nominate themselves or another person as the supplier contrary to s 171(2) RTRA Act. For this purpose, a firm or company is a person. The maximum penalty is 20 penalty units. [20] Although a breach of s 171(2) RTRA Act does not automatically or explicitly invalidate the special conditions that intention is readily inferred and, in any event, illegality can be a good response to enforcement action at common law where no cause of action is regarded as arising out of a wrong (ex turpi causa non oritur actio). [21] Moreover, RTRA Act compensation is a discretionary remedy and tribunal orders must be fair and equitable under s 13 QCAT Act and will seldom assist a dominant contracting party who relies on breaking a consumer protection law to prove a claim for relief. [22] The special conditions in issue obviously use the adverb “professionally” and adjective “professional” to distinguish carpet cleaning and fumigation services supplied by a paid professional under a commercial transaction, on the one hand, from DIY providers, on the other. [23] Although more than one construction is reasonably open when the text is read purposively and in context it is plain that the rule in s 171(2) RTRA Act is intended to prevent collusive or non-competitive practices for the financial gain of a particular “... person nominated by the lessor” or agent. On this basis, agreed terms referring to an unidentified member of a general class of service supplier such as a professional person are not illegal. [24] Accordingly, unless they are invalid for some reason the appellant is bound by the special conditions. Void conditions [25] Under s 53(1) RTRA Act a tenancy agreement or term is void to the extent it purports to exclude, change or restrict the application or operation of the RTRA Act about what condition tenants must leave the premises in at the end of the tenancy. A special term is also overridden by 54(1) and (2) RTRA Act to the extent it is incompatible with a standard term dealing with the same subject matter. [26] As already noted, the mandatory end of term obligation imported into the GTA by the RTRA Act requires the tenant to leave the premises and inclusions, as far as possible, in the same condition they were in at the start, fair wear and tear excepted. -- 4 of 5 -- 5 [27] The key word “condition” denotes a state rather than a standard. The expression “as far as possible” means closely proximate. Ironically, “near” could be substituted for “far” without changing the sense. The phrase “the same” is a point of comparison so that the benchmark for the state the premises and contents must be left in is their entry condition. [28] Compliance may extend to fixing broken fittings, mending torn curtains or painting damaged walls where necessary as well as detailed cleaning and pest eradication but it does not involve improving the state of the premises or its contents at the tenant’s expense for the landlord’s gain. [29] Thus, exit conditions requiring a departing tenant to pay for steam cleaning curtains that were dirty or worn out to begin with are unenforceable because they conflict with the effect of s 188(4) RTRA Act and clause 37 GTA but not if hiring contractors to shampoo the carpet is needed on exit to remove stubborn stains or eradicate fleas or other bugs that were not there at the beginning. [30] As the premises here were in the state of having been fumigated and included carpets cleaned by professionals at handover the special conditions merely contemplate the original condition of the premises being reinstated as far as possible not bettered. They amplify but do not purport to modify the terms of the RTRA Act and GTA. [31] There was no evidence at the hearing that paying for professional fumigation and carpet cleaning services was impossible in the circumstances or that the appellant met the description of a professional herself. Therefore, regardless of how professional her job was the obligation in s 188(4) RTRA Act was not fully met because the premises that she handed back at the end of the tenancy were not in the same condition as far as possible as they were at the start. [32] The position may be different if the premises and inclusions had not been professionally cleaned or fumigated before she rented them and were left, as far as possible, in the same condition without the help of professionally supplied services because the prediction at the beginning of the tenancy about what the premises would in fact need at the end to meet the s 188(4) RTRA Act or GTA obligation to restore them to their initial condition i.e. professional carpet cleaning and fumigation would be invalid and the special conditions based on it unenforceable. [33] In this case, however, the special conditions are enforceable and the appeal fails. -- 5 of 5 --