NSW - claiming compensation in relation to a tenancy

NSW law referenced below

As per the email from ADLsoftware today (scroll down to review), Members of Real Estate Excellence, please note I will be updating the Property Management Excellence PME manual in the near future which will include the following NEW sub chapter 27.12. For now, include this information as part of the manual Download the chapters here.

NEW PME manual chapter 27.12      Orders that may be made by tribunal

As per section 187 (below), the following orders can be made by Tribunal. MORE information will be provided to members with the upcoming updated version release.

187 Orders that may be made by Tribunal

 (1) The Tribunal may, on application by a landlord or tenant or other person under this Act, or in any proceedings under this Act, make one or more of the following orders:

(a) an order that restrains any action in breach of a residential tenancy agreement,

(b) an order that requires an action in performance of a residential tenancy agreement,

(c) an order for the payment of an amount of money,

(d) an order as to compensation,

(e) an order that a party to a residential tenancy agreement perform such work or take such other steps as the order specifies to remedy a breach of the agreement,

(f) an order that requires payment of part or all of the rent payable under a residential tenancy agreement to the Tribunal until the whole or part of the agreement has been performed or any application for compensation has been determined,

(g) an order that requires rent paid to the Tribunal to be paid towards the cost of remedying a breach of the residential tenancy agreement or towards the amount of any compensation,

(h) an order directing a landlord, landlord’s agent or tenant to comply with a requirement of this Act or the regulations,

(i) a termination order or an order for the possession of premises,

(j) an order directing a landlord or landlord’s agent to give a former tenant or person authorised by a former tenant access to residential premises for the purpose of recovering goods of the former tenant or fixtures that the former tenant is entitled to remove.

(2) Without limiting the Tribunal’s power to make an order as to compensation, the Tribunal may order compensation to be paid for the following:

(a) loss of rent,

(b) any other breach of a residential tenancy agreement,

(c) loss or damage suffered by a person as a result of inaccurate, ambiguous or out-of-date information being listed about the person on a residential tenancy database.

(3) An order under subsection (1) (a) or (b) may be made even though it provides a remedy in the nature of an injunction or order for specific performance in circumstances in which such a remedy would not otherwise be available.

(4) The Tribunal must not make an order for:

(a) the payment of an amount that exceeds the amount (if any) prescribed by the regulations for the

purposes of this section, or

(b) the performance of work or the taking of steps the cost of which is likely to or will exceed the amount (if any) prescribed by the regulations for the purposes of this section.

Note. This Act also confers other order-making powers on the Tribunal, including other specific powers to make termination

orders, to declare that premises have been abandoned, to make orders about holding fees and to make various orders about rental bonds.

188 General order-making power of Tribunal

 The Tribunal may, in any proceedings before it under this Act, make any one or more of the following orders:

(a) an order that the Tribunal may make under this Act,

(b) an order that varies or sets aside, or stays or suspends the operation of, any order made in proceedings or earlier proceedings,

(c) any ancillary order the Tribunal thinks appropriate,

(d) an interim order.

189 Application of provisions relating to Tribunal

 (1) A provision of this Act that enables a landlord or tenant to apply for an order by the Tribunal and the Tribunal to make an order also applies, where appropriate, to a former landlord or a former tenant.

(2) (Repealed)

From the RT regulations – section 22 Times for making applications to Tribunal: ss 44 (2), 83 (2) (a), 98 (4), 115 (3), 125 (3), 134 (3), 141 (2), 175 (3) and 190 (1) of Act

 (1) For the purposes of section 44 (2) of the Act, the prescribed period for making an application for an order that a rent increase is excessive is within 30 days after notice of the increase is given.

(2) For the purposes of section 83 (2) (a) of the Act, the prescribed period for the making of an application by a landlord for a termination order is within 30 days after the termination date specified in the relevant termination notice.

(3) For the purposes of section 98 (4) of the Act, the prescribed period for the making of an application by a landlord for the revocation of a termination notice is within 7 days after being served with the termination notice.

(4) For the purposes of section 115 (3) of the Act, the prescribed period for the making of an application by a tenant for a declaration that a termination notice has no effect on the ground that it is a retaliatory notice is:

(a) within 30 days after being served with the termination notice, if the termination notice was given under section 85 of the Act, or

(b) within 14 days in any other case.

(5) For the purposes of section 125 (3) of the Act, the prescribed period for making an application for a tenancy is within 30 days after the applicant was given notice of proceedings for the recovery of possession of the residential premises.

(6) For the purposes of section 134 (3) of the Act, the prescribed period for making an application for an order:

(a) under section 134 (1) (a) of the Act is within 30 days after the applicant becomes aware that goods have been disposed of otherwise than in accordance with the Act, or

(b) under section 134 (1) (b) of the Act is within 30 days after the applicant becomes aware that goods have been damaged, or

(c) under section 134 (1) (c) of the Act is within 3 months after the applicant becomes aware that the goods are in the possession of the landlord or landlord’s agent, or

(d) under section 134 (1) (d) of the Act is within 6 months after the residential tenancy agreement is

terminated.

(7) For the purposes of section 141 (2) of the Act, the prescribed period for the making of an application by a tenant under a social housing tenancy agreement or proposed agreement that rent is excessive is within 30 days after the cancellation of the rent rebate takes effect.

(8) For the purposes of section 175 (3) of the Act, the prescribed period for making an application for an order as to the payment of the amount of a rental bond is within 6 months after the bond is paid.

(9) For the purposes of section 190 (1) of the Act, the prescribed period for making an application for an order in relation to a breach of a residential tenancy agreement or proposed agreement is within 3 months after the applicant becomes aware of the breach.

 

23 Monetary limit of jurisdiction of Tribunal: s 187 (4) (a) of Act

 The amount prescribed for the purposes of section 187 (4) (a) of the Act is:

(a) if the order is with respect to a rental bond, $30,000, or

(b) in any other case, $15,000.

From ADLsoftware – email update #23895 received 12 10 2017

 

 

When Can You Claim Compensation in Respect of a Tenancy?

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We have had a number of enquiries about what compensation can be claimed for, and how to present such a claim, when a tenant is in breach of their fixed term residential tenancy agreement.

The Residential Tenancies Act 2010 is quite clear that the Tribunal may, on application by a landlord or tenant, make a number of orders including an order for the payment of an amount of money (section 187(1)(c)) and an order as to compensation (section 187(1)(d)) and further, in regards to compensation, states in section 187(2):

Without limiting the Tribunal’s power to make an order as to compensation, the Tribunal may order compensation to be paid for the following:

(a) loss of rent, (b) any other breach of a residential tenancy agreement, (c) loss or damage suffered by a person as a result of inaccurate, ambiguous or out-of-date information being listed about the person on a residential tenancy database.

Thus, the Tribunal has the power to make an order for any appropriate form of compensation (being an amount of money or otherwise), but is also specifically directed to take into account compensation for loss of rent as well as any other breach.

Click here to view section 187 of the Act

When should you be able to claim compensation using the 'Residential Tenancy Agreement with ADL Additional Terms'?

When making an Application to the Tribunal you should be able to make a claim for compensation as follows:

  1. Where you have not crossed out Additional Terms 41 and 42, you will be limited to claiming the break fee as calculated in accordance with Additional Term 41; OR
  2. Where you have crossed out Additional Terms 41 and 42, using the ADLForms 'Clause Cross-out' feature (Simply click on the terms to cross them out within the ADLForms program), ADL's Additional Term 53 will become effective and you should be able to claim for (among other things):
    • Loss of rent; and
    • compensation, including out of pocket and other reasonable expenses, as provided by sections 187(1)(c) and (d) and 187(2) of the Act.

With any claim, the amount of compensation claimed must be fair and reasonable and portrayed as such to the Tribunal. Note: A claim under Additional Term 53 is not limited as it would be if Additional Terms 41 and 42 applied.

Are advertising costs considered to be a fair claim?

Advertising costs should be a fair claim considering that a landlord would have budgets in place (particularly in respect of advertising costs) based on the tenant's legally written commitment to rent the premises for a specific term.

Where a tenancy terminates early, the landlord will be forced to outlay for advertising costs they have not budgeted for. The earlier the termination, the greater the effect on the Landlord's returns. A simple formula for determining a fair amount for such a claim might be:

(Cost of Advertising) X (Months Remaining) / (Term of Tenancy)

You may have your own formula or method of calculation.

Why would the Tribunal refuse to order compensation?

Where the Tribunal is of the opinion a claim is unreasonable the applicant will be unsuccessful.

When making claims for compensation it will be extremely important to present your case well and clearly refer to sections 187(1)(c) and (d) and 187(2) of the Act.

Bear in mind, not only is the Tribunal governed by the Act and Regulations but will be influenced by the individual Tribunal Members' own views and experience and it is the individual that you will have to persuade as to the fairness of your claim.

One difficulty to overcome is the Tribunal's tendency to lean towards the 'Break Fee' provisions (Additional Terms 41 and 42), even where they are crossed out in the Tenancy Agreement. Therefore it is important to draft your claim with care.

Alan Liddle (General Manager - ADL Software)

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