Young and Conway v Chief Executive Officer, Housing [2020] NTSC 59

Between

Enid Young and Robert Conway (Applicants) and Chief Executive Officer, Housing (Respondent)

Judge

Blokland J

Judgment

Justice Blokland of the Supreme Court considered the responsibilities of the CEO of Housing to provide 'habitable' and 'secure' properties under the Residential Tenancy Act 1999 (NT) (RTA). Her Honour also considered the circumstances in which agreements had been made between tenants and the CEO of Housing. 

In this appeal from a decision of the NT Civil and Administrative Tribunal (Tribunal), Blokland J found that the Tribunal's interpretation of 'habitable', under s 48 of the RTA, was too narrow and is not confined to matters of tenants' health and safety, but extends to reasonable comfort assessed against contemporary standards. Her Honour sent two issues back to the Tribunal for fresh consideration: 

• whether the claims fell within the wider meaning of not 'habitable'; and
• whether unconscionable conduct had occurred.

Justice Blokland also considered whether a back door could be a 'security device' under s 49 of the RTA and found that it could. Therefore, this particular issue was not sent to the Tribunal for fresh consideration and the Court awarded compensation for this breach.

Significance

This landmark case established a precedent that tenants must be provided with housing that is safe and 'habitable' under the RTA, and that habitability must be judged according to contemporary standards of 'humaneness, suitability and reasonable comfort' [80]. 

The residents' representative, Dan Kelly, said: 'this litigation is looking like the circuit breaker that could force wholesale change of remote housing in the NT that has been in dire straits for decades' (Grata Fund, 2019). 

This case empowered other communities, such as Laramba, to bring actions regarding their housing conditions. That case further focussed on the issue of unsafe water (Grata Fund, 2019).

Litigation History:

This Supreme Court appeal followed the decision by the Tribunal in Various Applicants from Santa Teresa v Chief Executive Officer (Housing) [2019] NTCAT 7.

Two of the four original applicants, Enid Young and Robert Conway, appealed the Tribunal’s decision to the Supreme Court of the Northern Territory. 

Robert Conway passed away before this appeal was heard.

Details of judgment

The term 'habitable' was too narrowly constructed 

The Court held that the Tribunal’s interpretation of 'habitable' under s 48 of the RTA was too narrow, and that the Tribunal had erred in confining habitability to matters of tenants' health and safety. 

In addition to health and safety, the Court held that the assessment of habitability should have included 'an overall assessment of the humaneness, suitability and reasonable comfort of the premises... judged against contemporary standards' [80]. Her Honour found that this assessment requires taking into account all proven inadequacies in combination. 

The matter was remitted back to the Tribunal to consider the claims under this wider meaning of 'habitable' [81].

Whether the agreements between the tenants and the CEO of Housing were void for unconscionable conduct

The Court found that the Tribunal had failed to consider whether the agreements between the tenants and the CEO of Housing were void for unconscionable conduct in keeping with the principles set out in Commercial Bank v Amadio (1983) 151 CLR 447.

These require:

• that the innocent party has a 'special disadvantage'; and
• the innocent party’s 'special disadvantage' affects their ability to make a judgement in their own interest; and
• the other party knew or ought to have known about this disadvantage; and
• the other party takes unconscientious advantage of the opportunity created by the disadvantage [35].

In applying these principles to the facts of this case, the Court noted the following circumstances: 

• the applicants’ vulnerabilities, including having limited English and some being unable to read; and
• the rushed nature of the lease's signing [34].

The Court found that if the circumstances did amount to unconscionable conduct, the agreements would be void. This would have different legal consequences to the Tribunal's finding that the agreements were invalid. 

When agreements are invalid due to inconsistencies with the RTA, the prescribed tenancy agreement in Schedule 2 of the RTA replaces the invalid agreement. However, where a contract is found to be void, this means that no agreement exists at all, and the applicants could claim for overpaid rent [40].

The Court referred the matter back to the Tribunal, which was asked to consider whether unconscionable conduct had occurred and the potential consequences of this [43].

The meaning of 'security device' was too narrowly constructed

The Court held that the Tribunal erred in holding that a 'security device' in s 49 of the RTA refers only to devices such as locks. 

The Court held instead that a back door could be a 'security device' [87]. As a result, the failure to provide a back door was a breach of this provision. 

The Court awarded $10,200 in compensation for the distress caused by this breach [93].

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References