4Walls Ltd t/as Compass Qld v Kjaer-Olsen [2014] QCATA 278

CITATION: 4Walls Ltd t/as Compass Qld v Kjaer-Olsen [2014] QCATA 278 PARTIES: 4Walls Ltd t/as Compass Qld (Applicant/Appellant) v Karina Kjaer-Olsen (Respondent) APPLICATION NUMBER: APL293-14 MATTER TYPE: Appeals HEARING DATE: On the papers HEARD AT: Brisbane DECISION OF: Senior Member Oliver DELIVERED ON: 25 September 2014 DELIVERED AT: Brisbane ORDERS MADE: 1. Leave to appeal is granted and the appeal is allowed. 2. The decision of the tribunal dated 7 July 2014 is set aside. 3. A termination order is made in respect of premises at 7/28 Paragon Street, Yeronga on the grounds of Failure to Leave as and from 4 June 2014. 4. I direct the issue of a warrant of possession to the Principal Officer of Police at the Moorooka Police Station in the State of Queensland on the following terms: a. This warrant takes effect on 29 September 2014. b. Whereas the Queensland Civil and Administrative Tribunal has made the Termination Order above, you are authorised for the period of 7 days from the above date expiring on the 6th day of October 2014 i. To enter the premises and give possession of the premises to the Applicant herein and ii. To exercise such powers under -- 1 of 5 -- 2 this warrant with necessary and reasonable help and force. iii. Entry under this warrant to be made between the hours of 8.00am and 6.00pm. CATCHWORDS: RESIDENTIAL TENANCY – TERMINATION – where lessor believes the tenant is conducting illegal activity on the premises – where notice to leave given under s 290A of the Residential Tenancy and Rooming Accommodation Act – whether it is necessary to issue a notice to remedy breach before giving a notice to leave – where s 290A provides a specific remedy to the lessor as defined in that section – where notice to leave is not dependant on a breach of the tenancy agreement but rather the conduct of the tenant. Queensland Civil and Administrative Tribunal Act 2009 s 142 Residential Tenancy and Rooming Accommodation Act 2008 ss 280, 290A, 355 Glenwood Properties Pty Ltd v Delmoss Pty Ltd [1986] 2 Qd R 388 McIver Bulk Liquid Haulage Pty Ltd v Fruehauf Australia Pty Ltd [1989] 2 Qd R 577 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 (QCAT Act). REASONS FOR DECISION [1] On 17 June 2014 the applicant filed an application to terminate a tenancy under s 290A of the Residential Tenancy and Rooming Accommodation Act 2008 (“RTRA Act”) in respect of rented premises at Paragon St, Yeronga. That section permits a lessor to give a notice to leave if the lessor reasonably believes the tenant has used the property for an illegal activity whether or not anyone has been convicted or found guilty of an offence in relation to the activity. [2] The activity complained of in the application is not specific but an email between a representative of the applicant and a Ms Thornton who has a police email address, included in the application, there is reference to “chemicals” and “lab”. At the hearing of the application the learned adjudicator was told that the illegal activity was the manufacture of illegal drugs. The tenant did not appear at the hearing and it proceeded on the -- 2 of 5 -- 3 basis that the premises were being used for an illegal activity. Further proof of that activity has been provided in the appeal. [3] On 7 July 2014 the application came on for hearing before a tribunal adjudicator and the application was dismissed because the learned adjudicator held that as no notice to remedy a breach was given to the tenant, as is required by s 280 of the RTRA Act, there was no power to terminate the tenancy, even under s 290A. [4] The applicant has filed an application for leave to appeal or appeal from that decision. It submits that s 290A was intended to be applied in a summary way and if the tribunal is satisfied that the lessor has formed a reasonable belief as to the existence of an illegal activity, it is unnecessary to first deliver a notice to remedy breach before issuing a notice to leave. [5] The appeal therefore is on the proper interpretation of s 290A of the RTRA Act. This involves an important question of law. Although leave to appeal is required under s 142(3) of the Queensland Civil and Administrative Tribunal Act, I am satisfied that the appeal raises a serious question for determination1 therefore leave to appeal is granted. [6] The section relevantly provides: 290A Notice to leave because of serious breach (1) The lessor may give a notice to leave the premises to the tenant if the lessor reasonably believes the tenant, an occupant, a guest of the tenant or a person allowed on the premises by the tenant has- (a) Used the premises or any property adjoining or adjacent to the premises (including any property that is available for use by the tenant in common with others) for an illegal activity; or (b) Intentionally or recklessly- (i) Destroyed or seriously damaged a part of the premises; or (ii) Endangered another person in the premises or a person occupying, or allowed on, premises nearby; or (iii) Interfered significantly with the reasonable peace, comfort or privacy of another tenant or another tenant’s appropriate use of the other tenant’s premises. (2) A notice to leave under this section is called a notice to leave for serious breach. (3) A lessor may form a reasonable belief that premises or property has been used for an illegal activity whether or not anyone has been convicted or found guilty of an offence in relation to the activity. (4) In this section- Lessor means- (a) The chief executive of the department in which the Housing Act 2003 is administered, acting on behalf of the State; or (b) A community housing provider. Note – 1 Glenwood Properties Pty Ltd v Delmoss Pty Ltd [1986] 2 Qd R 388 at 389; McIver Bulk Liquid Haulage Pty Ltd v Fruehauf Australia Pty Ltd [1989] 2 Qd R 577 at 578, 580. -- 3 of 5 -- 4 See section 329(2)(ia) for requirements about the handover day for a notice to leave given because of serious breach. [7] Section 290A was introduced into the RTRA Act through amending legislation in 2013. The purpose of the amendments was addressed in the explanatory notes: Section 290A provides that a lessor can give a tenant a notice to leave for serious breach if the lessor reasonably believes the tenant…..has used the premises for an illegal activity…Section is intended to allow action to be taken to end tenancies quickly where public housing or community housing properties are being used for illegal activity or, where there are other serious breaches. The use of such properties for illegal activities is a serious problem that will no longer be tolerated. For example properties are being used for more frequently as clandestine drug laboratories or for other drug related activities. The section is intended to allow eviction where such activities occur but it is not limited to drug related activities. It has been drafted widely to apply to illegal activities generally……..This intentionally lowers the standard of proof and will allow the lessor to take prompt action to issue a notice to leave for serious breach rather than having to await the outcome of criminal proceedings. [8] This question here for consideration is whether s 290A contemplates the need to first issue a notice to remedy breach under s 280 of the RTRA Act before a notice to leave can be given to a tenant. The section says: 280 Notice to remedy’s tenant’s breach (1) This section applies if the lessor believes on reasonable grounds that- (a) The rent payable under the agreement has remained unpaid in breach of the agreement for at least 7 days; or (b) The tenant has breached another term of the agreement and the breach has not been remedied. (2) The lessor may give a notice to the tenant requiring the tenant to remedy the breach within the allowed remedy period. [9] What is immediately apparent from s 280 is that the notice relates to a specific breach of the tenancy agreement. It is a breach of the tenancy agreement which, if not remedied, will ultimately result in the issuing of notice to leave with a specific handover date as prescribed by s 329. [10] A lessor can give a notice to leave without the need to give a notice to remedy breach if the basis of the notice satisfies the grounds set out in s 335 of the Act. The learned adjudicator referred to this section to assist him in coming to the conclusion that the issuing of a notice to remedy breach was a prerequisite to the issuing of a notice to leave under s 290A. It is understandable why he would have given consideration to this section because the grounds referred to in section 335 do not all relate to the parties obligations under a tenancy agreement, for example: excessive hardship; objectionable behaviour and incompatibility. Others do. [11] However, s 335 has general application to all lessors of premises whereas, the specific definition of “lessor” in s 290A is confined to the Chief Executive of the department in which the Housing Act 2003 is administered, acting on behalf of the State; or a community housing -- 4 of 5 -- 5 provider. Therefore s 290A stands alone as a remedy to a “lessor” as defined in the section. [12] Also, section 290A is not concerned with breaches of the tenancy agreement. As the explanatory memorandum states, its purpose is to provide immediate relief to a lessor to terminate a tenancy in the circumstances described in the section for an activity which may or may not involve a breach of the terms of any tenancy agreement. The only evidentiary burden on the lessor in an application for termination is to produce cogent evidence to satisfy the tribunal that there is a factual basis for the reasonable belief going to the activity complained of. [13] The section is not intended to give a tenant an opportunity to remedy the conduct particularised in the section. For example, how is a tenant going to remedy conduct which results in the intentional or reckless damage to the premises or endangering another person on the premises. The tenant can stop engaging in illegal activity but when illegal drugs are manufactured on the premises, as seems to be the case here, this can result in irreparable damage. The section is clearly directed to the conduct of the tenant in the occupation of the premises rather that the contractual relationship between a tenant and a lessor. [14] The section, in my view, operates independently of s 280 and therefore the issuing of a notice to remedy breach is not a necessary prerequisite to the issuing of a notice to leave under s 290A. The learned adjudicator was in error in his application of the section and therefore the Tribunal’s decision of 7 July 2014 is set aside. [15] As this appeal is on a question of law, under section 146(b) of the QCAT Act the appeal tribunal can substitute its own decision if the primary decision is set aside. The evidence produced by the applicant satisfies me that the premises were being used for an illegal purpose and therefore, rather than remit the matter for further consideration, it is appropriate in the circumstances for me to substitute my own decision. There will be an order terminating the tenancy with usual orders for the issuing of a warrant for possession. -- 5 of 5 --