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Benchmark - Real Estate Cases & Commentary
Tenancy matters
    •  Bonds
        -  Return of bond
            >  NEW Where tenant has not breached agreement
            >  NEW Remains tenant's property until Tribunal orders otherwise
            >  Where consent to early termination given
            >  Where no record of lodgement with Rental Bond Board
            >  Where no Residential Tenancy Agreement in existence



Where tenant has not breached agreement 

The tenant applied to the Tribunal for a refund of $425, which the landlord had claimed from the rental bond. The tenant also claimed a refund for extra charges for excess water and sewerage.

The landlord gave evidence that it had had to pay cleaning fees, and re-turfing fees, because the tenant had parked on the grass beside the driveway at the premises. The lease specifically stated that there was on-street parking only at the premises.

The tenant conceded that the Lease stated he was required to park on the street, and that, on occasion, he had driven his vehicle off the street when there were groceries or other heavy items that needed to be unpacked from the vehicle, but only for a limited time. He stated he did not generally park in the driveway or on the grass.

The Tribunal noted that the rental bond is provided as security for any failure by the tenant to comply with the terms of the Residential Tenancy Agreement. The landlord bears the burden of proving that there has been a failure by the tenant to comply and that the landlord is therefore entitled to compensation.

The Tribunal found that the tenant did not consent to any claim by the landlord on the rental bond.

In this case the Tribunal held that it was not satisfied that the tenant had breached the agreement, and that he had failed to leave the premises in a reasonable state of repair and cleanliness.

The Tribunal therefore ordered that the landlord had not been entitled to be paid $425 from the rental bond. The Tribunal ordered this amount be refunded to the tenant.
 
Harrison v Bastic [2012] NSWCTTT 130



Remains tenant's property until tribunal orders otherwise 

A former tenant applied to the Tribunal for payment of his rental bond. The landlord claimed that he was entitled to the bond.

The tenant appeared before the Tribunal, but the landlord did not.

The tenant gave sworn evidence and provided the Tribunal with a number of emails, including a schedule of rent payments. The schedule stated that the last two payments were outstanding. The tenant did not dispute that he owed money for water usage of around $300.

The tenant said that he had paid two weeks rent in advance at the beginning of the tenancy, and had not been told that he was in arrears in rent until he gave notice to quit the premises. After questioning by the Tribunal, the tenant conceded that he was probably one week in arrears of rent.

The Tribunal noted that a rental bond remains the tenant’s property until the Tribunal orders otherwise. Therefore, where there is a dispute involving a rental bond, the landlord bears the burden of proving that he or she should be entitled to any part of the bond.

The Tribunal stated that, in the absence of evidence from the landlord, it could not be satisfied from the rent schedule alone, or from the emails, that the tenant was two weeks in arrears. However, on the basis of the concession by the tenant that he was one week in arrears, the Tribunal ordered that one week’s rent, plus the water bill, should be paid to the landlord from the bond, and the remainder of the bond should be paid to the tenant.

Dalziell v Clahine [2012] NSWCTTT 196



Where consent to early termination given 

Former tenants applied for an order from the Tribunal that the rental bond money be refunded to them. They also sought orders for the repayment of rent and other payments that they had made.

The tenants had terminated the Residential Tenancy Agreement before the end of the fixed period. The issue was whether the landlord had given consent to this.

The tenants had asked a friend of theirs, who was a law student, to contact the landlord’s agent. This friend gave evidence she had spoken by telephone to an assistant property manager at the agent and had told her that the tenants wanted to terminate the agreement before the end of the fixed term because they had found another property which they wanted to rent.

The friend’s evidence was that she had clearly told the assistant property manager that the tenants would only terminate their current lease if the landlord would refund all their bond money and there would be no penalty for the early termination. The friend’s evidence was that the assistant property manager had told her that, as rent for the current month had already been paid, there would be no further payments or need be made, and that, in fact, some rent money might even be reimbursed to them.

The Tribunal accepted the evidence that the friend had given under oath as to her communications with the assistant property manager.

There was evidence from the agent regarding communications in which the landlord would not consent to early termination without the tenants being liable to pay rent to the end of the fixed term.

The Tribunal held that the statements made to the friend by the assistant property manager had amounted to a consent to early termination by the landlord.

The Tribunal noted that the tenants had vacated the property on the basis of that consent and had taken steps to rent another property in reliance on that consent.

The Tribunal pointed out that consent given by the landlord cannot be subsequently withdrawn, and referred to section 81(4)(e) of the Residential Tenancies Act 2010.

Therefore, the Tribunal ordered that the money retained out of the bond by the landlord on account of rent after the date of termination, including any dishonour fees, had to be refunded to the tenants.

Carter v Haslingden Carr Properties Pty Ltd [2011] NSWCTTT 464



Where no record of lodgement with Rental Bond Board 

The tenant applied to the Tribunal for the return of the bond.

The parties agreed that the tenant was entitled to the bond. However, the Rental Bond Services has no record or had no record of the bond ever having been paid.

The residential tenancy agreement, which commenced in 2001, showed that the tenant had paid a bond of $1,400.00 to the landlord at that time, and included a registration barcode number and a bond lodgement number. The bond had been paid to the agent and the agent had been responsible for lodging it with Rental Bond Services. The ownership of the property, and the managing agents for the property, had both changed several times since the rental tenancy agreement had commenced.

The Tribunal noted that the bond always remains the tenant’s money. However this money is provided as security for any claims that might be made by the landlord. The Tribunal further noted that the tenant is entitled to have the bond returned, provided that there are no claims by the landlord proved against the tenant.

The Tribunal noted that, when a property is sold by a landlord, and the new landlord buys the property subject to the tenancy, the buyer obtains an attornment of the rent, and the buyer should ensure that he or she obtains all the original residential tenancy documents, including the bond lodgment documents.

The Tribunal noted that the management and safe keeping of original tenancy records is the responsibility of the landlord and his or her managing agents. The Tribunal stated that if such documents are lost, it is the landlord’s responsibility, not the tenant’s responsibility.

The Tribunal therefore ordered that the tenant was entitled to a refund of the bond from the current landlord and that the current landlord can then attempt to seek compensation from the previous landlord, who can in turn seek compensation from the landlord previous to him or her, and so on down the line.

The Tribunal ordered the landlord to pay the tenant the sum of $1,400.00 immediately.

Al Adwan v He and Cai [2011] NSWCTTT 155



Where no residential tenancy agreement in existence 

The applicant sought a refund of his rental bond.

The arrangement had been in the nature of a share house, in which the applicant, as well as another person, had lived in premises leased in the name of the respondent.

There had been no standard form Residential Tenancy Agreement. However, the applicant did give evidence of some relatively informal terms under which he had been permitted to live in the premises.

The applicant said that he lived with the respondent in 2007. He said he had moved out and then moved back in in 2009.

The applicant asserted he paid a bond of $760.00, being four weeks rent.

The critical point was whether there had been a “Residential Tenancy Agreement” between the Applicant and the Respondent, within the meaning of the Residential Tenancies Act 1987 (which had been the applicable legislation at the time). The existence of such an agreement was necessary for the Tribunal to have jurisdiction.

The Tribunal noted that the applicant bears the burden of proving his claim, including proving the existence of the Residential Tenancy Agreement.

The Tribunal noted that the terms under which the applicant occupied the premises were at variance to the standard terms of a Residential Tenancy Agreement. Further, the Tribunal held that the parties could just as easily have intended to create some other form of licence to occupy the premises, such as a lodger arrangement, which did not come within the Residential Tenancies Act.

The Tribunal, after considering all the evidence, was not satisfied that there had been a Residential Tenancy Agreement. Therefore, the Tribunal held that it did not have jurisdiction, and the applicant’s claim failed.

Ng v Wee [2011] NSWCTTT 396