A caution to agents who seek to represent property owners in Tribunal proceedings

The recent case of Burlington Realty Pty Ltd t/as Burlington Property Agents -v- Farmer & Farmer^[1] demonstrates the risks assumed by real estate agents when seeking to represent property owners’ interests in proceedings before the Queensland Civil and Administrative Tribunal (QCAT).

Facts

In this case, James Farmer and Keely Thurecht (tenants), rented a residential property managed by Burlington Realty (agent).

Following two flood events which occurred in February 2024, and January 2025, mould saturated the home office of the property, causing the tenants to suffer health symptoms and damage to various personal effects stored within the home office. After the owner failed to remedy the problem promptly, the tenants served a Form 11 notice and vacated the property.

The tenants later pursued a claim in the QCAT, seeking damages on account of their loss of amenity of the property, and damage to their personal effects.

At the hearing, the property owner was represented by the agency’s employed property manager.

When the Adjudicator enquired of the tenants how they had arrived at their assessment of the value of their personal effects purportedly damaged by the flood, the tenants tendered a table of comparative replacement values for items similar to those which they claimed had been damaged as result of the flood events. The property manager did not seek to challenge that material being it was received into evidence, nor did she request an adjournment to consider the content of that material.

The Adjudicator ultimately found that the owner had breached its obligations under section 185 of the Residential Tenancies Rooming Accommodation Act 2008 (Qld) (RTRAA), to maintain the property in a habitable state, and made orders requiring the owner to pay to the tenants damages in the sum of $6,720 reflecting a rental rebate of 100% for a period of six weeks equating to $3,720, plus $3,000 on account of damage to the tenants’ personal effects (Initial Decision).

The agency appealed the Initial Decision on behalf of the owner.

Grounds of Appeal

The appeal was premised on grounds that the learned Adjudicator had:

• denied the owner procedural fairness by receiving into evidence the table of comparative personal items on the day of the hearing and, in doing so, had deprived the owner of the opportunity to conduct its own research and present contradictory evidence to the Tribunal;
• failed to adequately explore Mr Farmer’s statement that the damage to the tenants’ personal items occurred during both the first and second flood, given that the claim for damage arising from the first flood had been brought out of time such as to disentitle the tenants to any compensation for losses arising from that event;
• erred when he awarded the tenants 100% of their rent for a period of six weeks because the property was not unliveable, and the amount awarded exceeded the sum claimed by the tenants;
• erred by failing to consider that the tenants did not mitigate their loss by:
  • Allowing their personal items to remain in the home office for an extended period after the second flood; and 
  • Failing to take out insurance for their personal effects.

The Appeal Decision

In addressing the first limb of the Appeal, the agency argued that the Adjudicator should have adjourned the initial hearing of his own motion because it is “rare” for property managers to know that they can object to late evidence or to seek an adjournment to consider the newly introduced evidence prior to determining how to proceed.

The Appeal Tribunal rejected this submission, holding:

• Agents are professionals. Citing Peng v Darley Properties Pty Ltd,^[2] the Tribunal confirmed that real estate agents fall within the modern indicia of a profession, involving “intellectual activity … professional standards of competence, training and ethics … reinforced by some form of official accreditation accompanied by evidence of qualification”^[3];
• While section 206(1)(b) of the RTRAA confers on agents the right to appear in place of a property owner in prescribed Tribunal proceedings, standing in the owner’s place is a grave responsibility. The “professional standard of competence requires an agent standing in the place of a homeowner to possess, at a minimum, an elementary understanding of the processes of the Tribunal, including its general power under s 57 of the QCAT Act to adjourn a proceeding”^[4];
• Procedural fairness must be exercised, not awaited. The Appeal Tribunal reaffirmed that procedural fairness requires a respondent be given the opportunity to see and comment on an applicant’s material.^[5] However, where a professional party fails to object or seek an adjournment, they cannot complain on appeal. Relying on Hawkins v East,^[6] the Appeal Tribunal affirmed that procedural fairness is “a flexible notion … commensurate with the nature and demands of the jurisdiction”, and requiring Adjudicators to proactively protect professional parties from the consequences of their own inaction is “inconsistent with the Tribunal’s mandate to deal with matters in a way that is accessible, fair, just, economical, informal and quick”^[7], and this is particularly so in a “demanding minor civil disputes jurisdiction, where thousands of application are processed and determined each year”.^[8]

The Appeal Tribunal rejected the second ground of appeal, finding that it was evident on the transcript that Mr Farmer had “merely misspoken” and that both tenants had confirmed that the damage had occurred as a result of the second flood. A factual finding will only be disturbed if “glaringly improbable” or “contrary to compelling inferences”.^[9]

As to the argument that the Adjudicator had erred in his assessment of the rent rebate available to the tenants, the Appeal Tribunal made clear that, while a notional rent reduction is one method of calculating compensation under the RTRAA s 420(1)(e), it is not the only method. It affirmed that a global award for discomfort and inconvenience is permissible,^[10] and oral reasons in the minor civil dispute jurisdiction are not held to an “impossible counsel of perfection”.^[11]

Finally, the Appeal Tribunal held that the tenants could not reasonably have predicted the rapid rate at which mould would accumulate, nor could it be concluded that mould would not have developed on items exposed to high moisture levels even if removed from the home office at an earlier time. Separately, it further reaffirmed that the absence of contents insurance does not protect a lessor from liability for breach of the tenancy agreement.^[12]

Accordingly, the Appeal Tribunal held that there was no reasonable argument that there was an error to be corrected and leave to appeal was refused. 

Key Takeaways

This decision establishes that an agency who appears in place of a property owner pursuant to the RTRAA s 206(1)(b) is expected to meet a minimum professional standard of competence in Tribunal proceedings. This includes understanding the right to object to the introduction of late evidence and the power to seek an adjournment. Agents who remain passive, and later seek relief on appeal, are very unlikely to succeed and may, in fact, expose themselves to a subsequent claim by the property owner.

It is strongly recommended that agents who are instructed to represent the interests of a property owner client in a prescribed Tribunal proceeding give careful consideration to whether they are sufficiently informed of their rights and obligations prior to acting upon those instructions.Where complex issues arise, or an agent lacks the requisite knowledge of the legislative provisions under which it is expected to advocate for the property owner, they should encourage their client to seek independent advice from a suitably qualified legal practitioner to ensure that their interests are properly protected. 

Agents who are unsure of their obligations may seek advice via the REIQ Property Management Support Service.   

Read another article on property management: Do you know when the rent is due?