A High Court victory for residents of a remote community who sued the Northern Territory government over the appalling condition of their rental properties has implications for renters with negligent landlords across the country. By Rick Morton.
NT community’s win benefits all renters
Residents of a tiny remote community south-east of Alice Springs have won a significant High Court appeal against their landlord, the Northern Territory government, giving tenants across the country the right to sue for distress and disappointment caused by neglectful property owners.
Wednesday’s decision of the High Court of Australia in the case brought by Ms Young against the chief executive of NT Housing goes well beyond its particular facts – notably that Ms Young spent more than five-and-a-half years without a back door to her house in Ltyentye Apurte, also known as Santa Teresa.
The court unanimously agreed Ms Young was entitled to compensation for the distress and disappointment she experienced as a result of NT Housing’s failure to maintain the property, although the bench was split as to the technical interpretation of the law that allowed them to reach the same conclusion.
Whichever decision is favoured makes no practical difference. Landlords everywhere have been put on notice that they, too, have an obligation to provide residential leases that include the implicit promise of “pleasure, relaxation or freedom from molestation”.
“The decision from the High Court is that compensation for disappointment and distress – so that is for the mental anguish that’s caused by living in a dilapidated house – is compensable,” solicitor Dan Kelly, of the Australian Lawyers for Remote Aboriginal Rights (ALRAR), told The Saturday Paper.
“Previously, the general view had been that that type of compensation was only available for contracts that were directly related to or specifically about enjoyment.”
The classic example, cited as precedent in this matter, is the case of a woman who boarded a cruise ship in 1986, only for it to strike coral and sink five days before it was due to dock. Because it was a cruise – designed to be pleasurable – the court ruled the promise of enjoyment had been breached when the cruise ship sank.
Now Australia’s top court has widened that literal interpretation to include tenancy agreements governing a person’s home.
It was a long and at times dirty fight.
On February 5, 2016, 70 residents from the Aboriginal community of Santa Teresa filed applications against the chief executive of NT Housing in the Northern Territory Civil and Administrative Tribunal arguing the dwellings in which they lived had been left in a state of shocking disrepair and were unsafe for habitation.
Initially, the tribunal examined a sample of four matters with the hope of resolving these and applying the decisions to the others. The cases belonged to Jasmine Cavanagh, Ms Young, Mr Conway and Clayton Smith. In the tribunal, the NT government counterclaimed against both Ms Young and Mr Conway for unpaid rent – a tactic deployed “as a sword”, according to another court – but ultimately failed because record keeping at NT Housing was so poor that it could not prove the assertion.
The government department says it has written off $70 million in rent it alleges was never paid but has failed to produce evidence for the figure.
Further, during the tribunal hearings the government attempted to renegotiate tenancy agreements with Ms Young, Mr Conway and the other claimants without informing the tribunal or their lawyers.
“In my view, the failure to inform an Applicants’ legal representative before contacting the Applicants to execute a ‘replacement’ tenancy agreement falls below the honest and fair handling of litigation expected of a model litigant,” tribunal member Les McCrimmon said in his decision on February 27, 2019.
The evidence before the tribunal was substantial.
Ms Young, who testified through a translator, showed that a shower and drain had been leaking for 2117 days, and that she had no back door for 2090 days and a toilet that flushed poorly and failed to clear waste for 534 days. In a community where animals roamed freely, including wild horses, the perimeter fence was bent all the way to the ground for 2328 days. Ms Young, who was in her late 70s when she brought the case, had no air-conditioner for 2121 days. Mr Conway had a home infested with insects for 1035 days and, on account of leaking water, slept in the kitchen for 1989 nights.
Just a day after the High Court decision in this case was delivered, law firm Slater and Gordon announced it was working with the ALRAR to investigate a “potential class action” on behalf of thousands of tenants living in “substandard” public housing in remote Aboriginal communities in Western Australia. Similar conditions are also found in remote housing in Queensland and South Australia in particular.
“Santa Teresa is not an isolated case,” Kelly said.
“We’ve run similar actions for other communities in the NT and find the same thing everywhere we go.
“You have to start with the decades of neglect that have really run these communities into the ground. And it’s not just housing, it’s the electrical systems, sewerage. All of that stuff.
“So then, [in this case] the Northern Territory government, they start well behind the eight ball on this. They don’t have a lot of money and they don’t have good systems in place. So it all comes together as a rolling disaster that no one seems to be able to fix.”
While these matters were being fought, the Territory government announced plans to overhaul how rent was paid in remote communities, charging a flat rate of $70 per bedroom per week, which would lead to rent hikes of 40 per cent for more than two thirds of remote residents. Ostensibly, the new program – which began early this year – was designed to fund maintenance and repairs in community housing. But little has changed.
Ms Young’s niece, Annie Young, 55, has been a powerful advocate for the housing rights of people in her community.
“We really used to manage our own housing,” she tells The Saturday Paper.
“In this community we used to have our own – we called it the Progress Housing Association – that used to be owned and controlled within the community, by community people working together.
“And now as soon as the [Northern Territory] Intervention came out, that was the one that wiped everything out.”
Following the NT Intervention, led by former prime minister John Howard and extended by his successor Kevin Rudd, the right to manage community housing was taken from residents, with an emergency lease handed to the NT government. Later, the Commonwealth convinced residents to sign over the housing stock on a 40-year lease to the federal government in exchange for maintenance and funding for repairs. They offered no alternative. As soon as the lease was signed, the Commonwealth sublet the entire arrangement to the NT government, which has had responsibility ever since.
“We are neglected in community at the moment,” Annie Young said.
“I call them [NT Housing] up for fixing, but I just call it a bandaid job. That’s why people are living in distress now.
“But it’s not just us struggling in communities, Indigenous peoples also in the cities as well. And many Australians – us all, we all in the same boat.”
It’s this filament of connection across culture and space that gives Annie Young strength. Her voice has made a real change, not just for her community, but for many renters.
Better Renting executive director Joel Dignam told The Saturday Paper the High Court decision was not only positive for the Santa Teresa tenants who lived in “indefensible” conditions but it also represented an important evolution in the understanding of renters’ rights.
“We see a pretty clear pattern in tenancy cases where it is actually really hard for people to get through tribunal,” he said.
“And then even if you do, often the compensation you get is quite paltry. So it might find that, yes, your oven didn’t work for two months, and so you will get back $10 a week. And it’s like, was it even worth it?”
This decision fills in a gap beyond questions of mere function, such as did the door lock, did the oven work, did the toilet flush? It is a warning to agents and landlords that when these things don’t work or aren’t fixed, they have a direct effect on the quality of life of a tenant. And that matters.
“I guess the best outcome from here is that you see agents being more proactive about actually making sure the properties they rent out already meet standards and are responding to requests as they come in,” Dignam said.
“The solution isn’t getting tenants better and better legal arguments. It’s a different culture and it’s a different market where it never goes that far.”
The Santa Teresa case was backed by strategic litigation incubator Grata Fund, based at UNSW Sydney. Its executive director Isabelle Reinecke said this case was the first residential tenancy matter heard by the High Court “in a generation”. She said it would have “consequences for renters nationwide”.
That is because the terms appearing in the Residential Tenancies Act (NT) are substantially the same as, or similar to, those in other states and territories.
Dan Kelly said despite holding the ultimate lease in remote NT communities as a result of the Intervention, the Commonwealth has been missing in action.
“This shouldn’t be an eight-year fight,” he said. “But now we have this decision and, if you have suffered distress and disappointment in a tenancy, you can absolutely cite this case before a tribunal. In fact, you should.”
Just weeks ago, Kelly had another win against the same government landlord operating the same sublet lease from the Commonwealth. The Northern Territory Supreme Court overturned a tribunal decision that found the residents of Laramba, west of Alice Springs, were not owed safe drinking water by their housing provider. Drinking water in the town contains uranium levels three times higher than the maximum for safe consumption.
The obligations of landlords are now even clearer.
In the Young case, at the very least, there is now legal clarity around an initial and apparently absurd contrast in findings of the NT tribunal, summarised in the minority judgement of High Court justices Michelle Gordon and James Edelman.
“Although the Tribunal accepted (in respect of a different applicant) that the failure by the Chief Executive Officer (Housing) to provide a key to a front door lock would be a breach … the Tribunal held that there was no breach of that term by failing to provide an entire door,” they wrote in their decision.
“The obligation of quiet enjoyment is more than an obligation merely to afford possession; it extends also to securing enjoyment of the lease for all usual purposes.”
Mr Conway died in early 2020, while his case was still working its way through the courts. It was taken over by his estate. Ms Young died earlier this year, while the High Court was deliberating on her test case.
“They passed waiting for houses and they passed waiting for answers as well,” Annie Young said.
“But that win was a big start for us. I guess we just gotta keep going. I got lots of energy left.”
This article was first published in the print edition of The Saturday Paper on November 4, 2023 as "Eight-year f ight for a back door".
For almost a decade, The Saturday Paper has published Australia’s leading writers and thinkers. We have pursued stories that are ignored elsewhere, covering them with sensitivity and depth. We have done this on refugee policy, on government integrity, on robo-debt, on aged care, on climate change, on the pandemic.
All our journalism is fiercely independent. It relies on the support of readers. By subscribing to The Saturday Paper, you are ensuring that we can continue to produce essential, issue-defining coverage, to dig out stories that take time, to doggedly hold to account politicians and the political class.
There are very few titles that have the freedom and the space to produce journalism like this. In a country with a concentration of media ownership unlike anything else in the world, it is vitally important. Your subscription helps make it possible.
Select your digital subscription