Donovan v Inkster [2015] QCATA 147

CITATION: Donovan v Inkster [2015] QCATA 147 PARTIES: David Thomas Donovan (Appellant) v Leonard Stephen Inkster (Respondent) APPLICATION NUMBER: APL032-15 MATTER TYPE: Appeals HEARING DATE: On the papers HEARD AT: Brisbane DECISION OF: Senior Member Endicott DELIVERED ON: 28 September 2015 DELIVERED AT: Brisbane ORDERS MADE: Leave to appeal is refused. CATCHWORDS: APPEAL – RESIDENTIAL TENANCIES – NOTICE TO LEAVE WITHOUT GROUNDS – where fixed term tenancy expiring – where tenant declined to renew tenancy for a further fixed term – where tenant preferred to continue on a periodic term tenancy – where notice to leave without grounds issued to tenant – where tenant claimed notice was retaliatory action – where adjudicator dismissed claim – whether decision attended by error Residential Tenancies and Rooming Accommodation Act 2008 (Qld) ss291(2)(b)(ii) and 291(3) Du Preez v Linda’s Homes Pty Ltd [2010] QCATA 002 Grimshaw v YMCA [2010] QCATA 88 APPEARANCES and REPRESENTATION (if any): This matter was heard and determined on the papers pursuant to s 32 of the Queensland Civil and Administrative Tribunal Act 2009 (Qld) (QCAT Act). REASONS FOR DECISION -- 1 of 6 -- 2 [1] David Thomas Donovan entered into a tenancy of residential premises for a fixed six-month term on 21 March 2014. Before the end of the term, the owner’s agent offered a renewal of the residential tenancy for a further six- month fixed term. The agent informed Mr Donovan in July 2014 that if he did not intend to review for a further six month term, then he should complete a notice of intention to leave form. [2] The evidence reveals that Mr Donovan did not want to enter into a furthe r six month fixed term tenancy but instead he expressed a preference to continue the tenancy but on a periodic basis. Just days before the expiry of the initial tenancy agreement in September 2014, the owner’s agent again raised with Mr Donovan whether he intended to sign a further six- month tenancy. The agent informed Mr Donovan that if he refused to sign a further fixed lease, the agent would issue a notice to leave to Mr Donovan. [3] Mr Donovan’s evidence was that the agent had told him that the owner did not want a periodic tenancy as he did not want the risk that Mr Donovan would vacate over the Christmas period when it was difficult to find a replacement tenant. Mr Donovan and the agent reached an agreement and Mr Donovan signed a residential tenancy agreement for a fixed term for the period 19 September 2014 to 6 January 2015. [4] On 6 November 2014 the agent sent a letter to Mr Donovan reminding him that the tenancy would expire on 6 January 2015, that there would be an increase of rent of $5.00 per week as from 7 January 2015 and enquiring if Mr Donovan wanted to renew the tenancy for a further six month term. The letter stated that if Mr Donovan decided not to renew, then he should give a notice of intention to leave. [5] Mr Donovan did not intend to renew the tenancy for a further six-month term. He informed the agent that he was unsure if he would remain residing in the premises for that further period of time and he did not want to pay the costs associated with breaking a fixed term tenancy. According to Mr Donovan’s evidence, the agent suggested a further three month fixed term tenancy which Mr Donovan indicated he would consider. [6] However, Mr Donovan decided that he would ask for an agreement that the owner would waive any break lease costs if he vacated the premises before the end of a further fixed term tenancy and if such an agreement could not be reached, he would prefer to stay on under a periodic tenancy. He gave a letter in these terms to the agent on 3 December 2014. [7] In his letter, Mr Donovan pointed out that the residential tenancy agreement expressly allowed for the tenancy to become a periodic tenancy once the fixed term expired. It was his practice to revert to a periodic tenancy when a fixed term expired and nothing to the contrary was mentioned when he signed the residential tenancy agreement in March 2014. He stated that he preferred the existing tenancy continue on a periodic basis as allowed for under clause 6 of the residential tenancy agreement. -- 2 of 6 -- 3 [8] On 5 December 2014 Mr Donovan received a notice to leave issued by the agent. The handover date was expressed to be 4 February 2015. [9] Mr Donovan’s evidence was that he then held discussions with the agent and the agent’s wife in an attempt to resolve the matter but to no avail. Mr Donovan gave a letter to the agent in which he stated that the notice to leave was a retaliatory action under the Residential Tenancies and Rooming Accommodation Act 2008 and if not withdrawn, then he would apply to QCAT to overturn the notice. [10] The notice was not withdrawn and on 5 January 2015 Mr Donovan commenced a proceeding in QCAT seeking to restrain the operation of the notice to leave until 6 July 2015. At a hearing held on 20 January 2015 Mr Donovan’s application was dismissed. Mr Donovan had appealed against that decision. A stay of operation of the notice to leave was granted by the Appeal Tribunal of QCAT. [11] Mr Donovan argues that the adjudicator failed to consider his claim of retaliatory eviction but instead was focussed on contract law issues of offer and acceptance. Mr Donovan submitted that the decision should be set aside as the adjudicator did not in fact determine the actual application that he had brought to the tribunal for adjudication. Mr Donovan however conceded that earlier in the hearing, the adjudicator had stated that retaliatory action should be not considered too broadly but he argues that the adjudicator did not include any reference to retaliatory action in his reasons for decision. [12] Because this is an appeal from a decision of the tribunal in its minor civil disputes jurisdiction, it is necessary for Mr Donovan to seek leave to appeal the decision.1 Leave to appeal will usually be granted where there is a reasonable argument that the decision is attended by error, and an appeal is necessary to correct a substantial injustice to the applicant caused by that error.2 [13] The appeal is opposed by Mr Inkster. [14] The reasons for decision by the adjudicator were delivered during the course of the hearing which lasted for about 11 minutes. The reasons were not separately delivered at the end of the hearing. As revealed by the transcript of the hearing, the adjudicator was aware that the application before him was based on a claim that retaliatory action had been taken by the agent of the owner against Mr Donovan as tenant. Right from the beginning of the hearing, the adjudicator made it clear that he did not accept on the evidence of Mr Donovan that retaliatory action had been taken. [15] During the rest of the hearing, the adjudicator set about explaining why he had formed this view. The adjudicator went straight to the issue of why Mr Donovan believed there was retaliatory action. He read out in essence what 1 QCAT Act s 142(3)(a)(i). 2 Pick ering v McArthur [2005] QCA 294 at [3]. -- 3 of 6 -- 4 Mr Donovan had put into his written submissions. The adjudicator stated that it was correct that an agent could require Mr Donovan to sign a further fixed term lease and could serve a notice to leave if Mr Donovan would only consider a periodic tenancy.3 Further on in the hearing, the adjudicator made the following comment about the continuation of a tenancy: “it just comes down to what is agreed between lessor and tenant.”4 [16] The adjudicator referred to Du Preez v Linda’s Homes Pty Ltd, a decision of the Appeals Tribunal which involved retaliatory action.5 The adjudicator explained how the Appeals Tribunal had concluded that retaliatory action is not to be given too broad a construction. Mr Donovan informed the adjudicator that he was aware of that decision and that he agreed it set out the correct way to apply the provisions about retaliatory action.6 [17] The adjudicator then went to section 291 of the Residential Tenancies and Rooming Accommodation Act 2008 which deals with notices to leave issued by a lessor. The adjudicator clearly demonstrated he understood that Mr Donovan was challenging the validity of the notice to leave. [18] Under 291(3), a lessor may not give a notice to leave if giving the notice constitutes taking retaliatory action against the tenant. There are other circumstances which prevent a lessor from giving a notice to leave in addition to disentitlement due to retaliatory action. The adjudicator considered those other circumstances set out in section 291(2)(b)(i) and (ii) and concluded that they did not apply in this case. [19] In particular, the adjudicator found that Mr Donovan as tenant had no rights associated with negotiation about a new fixed term that would call the protections in section 291(2)(b)(ii) into play. While the adjudicator agreed with Mr Donovan that a tenant has the right to discuss and negotiate such terms with a lessor, the adjudicator found that Mr Donovan’s rights to do so were not being breached by the lessor in this case. [20] The adjudicator also expressly considered whether there was retaliatory action in terms of section 291(3). In doing so, he set out by way of explanation a hypothetical example of retaliatory action when a tenant asked for repairs to be carried out, a lessor refuses to conduct repairs and then issues a notice to leave without grounds. By using this example, the adjudicator endeavoured to explain that the current case involving the negotiation of a fresh term did not come within the category of retaliatory action involving a tenant’s rights being breached. [21] It was at this stage that the adjudicator sought assurance from Mr Donovan that he understood why the adjudicator could not accede to the claim made by Mr Donovan to stay the operation of the notice to leave by labelling the 3 Lines 5-7 on page 3 of the transcript. 4 Lines 5-6 on page 4 ibid. 5 [2010] QCATA 002. 6 See lines 43-43-46 on page 4 and lines 1-20 on page 5 ibid. -- 4 of 6 -- 5 issuing of the notice as retaliatory action.7 Mr Donovan stated that he understood, although he also stated that he did not agree. [22] In this application for leave to appeal, Mr Donovan argues that the adjudicator did not properly apply the statutory provisions about retaliatory action. In particular, he argues that the Tribunal in other cases, such as in Grimshaw v YMCA, had set aside a notice to leave when the parties had fallen out over negotiations for a tenancy renewal.8 That particular case is clearly distinguishable as the tenant had issued a notice to remedy breach against the lessor and had taken his dispute to the Residential Tenancies Authority for resolution before the lessor issued a notice to leave. [23] It was at this stage of the hearing that Mr Donovan asked if he could make further submissions based on what his interpretation of the contractual provisions in the residential tenancy agreement. He referred to the standard terms in that agreement that provide that a term could go from fixed to periodic. [24] It was Mr Donovan who raised the fact that the agent had made an offer for another fixed term, that that offer had been withdrawn and that there was some possibility that Mr Donovan’s response was a counter-offer. The adjudicator correctly commented that the evidence did not reveal an offer and acceptance and at best there had been some negotiation that did not get to the point of acceptance. The adjudicator stated that the issuing of the notice to leave would have terminated the negotiations and on that further ground raised by Mr Donovan he could not give the relief Mr Donovan had sought. [25] This examination of the transcript of the hearing fails to reveal that the decision made by the adjudicator was attended by error. The adjudicator made no error in rejecting the submissions by Mr Donovan that issuing the notice to leave was a retaliatory action on the part of the lessor and agent. There had been no relevant action taken by the tenant against which the lessor’s notice could be found to have retaliated. At best there was a dispute between the parties at the relevant time as to whether the tenancy would be renewed for a fixed term or as a periodic tenancy. [26] In addition, Mr Donovan did not establish any right to continue to reside in the premises on a periodic basis. If he had held over after the expiry of the fixed term and if no prior notice to leave had been issued, then and only then would he have had a right to remain in the premises as a tenant on a periodic basis based on clause 6 of the standard residential tenancy agreement. Given the fact that the notice to leave was given prior to the expiry of the fixed term, that right did not arise on the facts of this case. The notice to leave was not a retaliation against Mr Donovan endeavouring to enforce a relevant right against the lessor. 7 See lines 12-28 on page 6 ibid. 8 [2010] QCATA 88. -- 5 of 6 -- 6 [27] The dispute over renewal was in essence two parties insisting on respective outcomes that were mutually exclusive. To label the dispute as involving retaliatory action would be applying the legislation too broadly as was explained in Du Preez v Linda’s Homes Pty Ltd where Justice Wilson commented: “Section 291(3) requires careful consideration of the particular circumstances of each case in which it is raised. If retaliatory is construed too broadly, almost any complaint by a tenant to an agent or landlord, or even a less than amicable exchange between them, might qualify in the sense that if the owner or its agent then gives a notice to leave the notice may be categorised as retaliatory. It is improbable that the legislature intended that effect.”9 [28] The facts do not reveal any relevant action to enforce his rights taken by Mr Donovan that would come within the category of action protected by section 291(2). The lessor had a right to refuse to renew the tenancy on terms that the lessor did not find palatable. If Mr Donovan would not agree to a fixed term, then the lessor had every right to seek out a new tenant who would agree to a fixed term. In the absence of an agreement by Mr Donovan to leave the premises at the end of his tenancy, a notice to leave had to be issued in order for the lessor to be legally able to install a new tenant in the premises. The adjudicator was correct to say that this was just commerce and not a breach of the lessor’s legal obligations to Mr Donovan.10 [29] In the absence of any error in applying the relevant statute law found to have been made by the adjudicator, I find that the conclusion reached by the adjudicator to reject the claim of retaliatory action was correct. Although the adjudicator’s explanation for this decision was brief, it was an adequate explanation for the parties appearing before him. [30] The adjudicator set out why he refused to find that the action of the lessor’s agent was retaliatory and why he refused the relief sought. Mr Donovan confirmed during the hearing that he understood the basis on which his claim was refused. The adjudicator’s reasons were adequate in the circumstances and the allegation that there was some error in the adjudicator failing to provide adequate reasons is not sustained. [31] I cannot ascertain any substantial injustice to Mr Donovan as his claim of retaliatory conduct was duly considered and correctly determined at the hearing on 20 January 2015 in accordance with the law. [32] His application for leave to appeal is refused. 9 Op cit paragraph 16. 10 See line 8 on page 3 of the transcript. -- 6 of 6 --