Update on asbestos testing, compensation scheme

Last week, The Brown Couch published a piece outlining a NSW Fair Trading scheme to identify, purchase, and demolish homes containing toxic loose-fill asbestos. Fair Trading's Loose-Fill Asbestos Implementation Taskforce have since clarified some ambiguities about how tenants of affected dwellings may be impacted.

Above: advertisement for 'Mr Fluffy', responsible for installation of the substance 

Most notable is the question of relocation assistance. The fact sheet addressing compensation under the scheme provides that up to $1000 is available per tenant "named on the residential lease". This proviso seemingly excludes those who are considered tenants under the Residential Tenancies Act, but do not have a written agreement between themselves and a landlord. However, relocation assistance will in fact be provided to tenants with oral and/or implied agreements, as well as sub-tenants with written agreements, if they can provide the Asbestos Taskforce with evidence of their status as tenants. Such applications for relocation assistance will be assessed on a case by case basis. 

Also left open was the question of how an owner that had agreed to Government purchase of affected land would go about terminating a tenancy agreement over the property. This is especially pertinent as a landlord cannot terminate a fixed-term tenancy agreement because the property has been sold unless their intention to sell was disclosed before the tenancy agreement was made. The Taskforce has provided  termination will be affected according to the ordinary means available under the Residential Tenancies Act. 

This leaves open the possibility that affected tenants with fixed-term agreements may negotiate the terms of any agreement to end the tenancy early. However, it will of course remain open to landlords to terminate fixed-term tenancies at the conclusion of the term, and to terminate periodic tenancies without grounds. 

It also appears possible that either tenant or landlord may be able to terminate on the grounds that the agreement has been 'frustrated', because the property is uninhabitable. 

Tenants that suspect their home may be affected should contact their local Tenants' Advice and Advocacy Service for assistance. Contact details for the general services operating in Local Government Areas identified as containing homes with loose-fill asbestos are as follows:

- Illawarra and South Coast Tenants Service: 4274 3475
- Northern Sydney Area Tenants' Service: 8198 8650
- Southern Sydney Tenants Advice and Advocacy Service: 9787 4679
- South Western NSW Tenants Advice and Advocacy Service: 1300 483 786
- Western Sydney Tenants' Service: 8833 0933

Aboriginal tenants may also contact the following services:

- Greater Sydney Aboriginal Tenants Service: 9696 0873
- Southern NSW Aboriginal Tenants Advice and Advocacy Service (Murra Mia): 4472 9363
- Western Aboriginal Tenants Advice and Advocacy Service: 6884 0969

Asbestos testing, compensation for tenants

NSW Fair Trading has established a program to identify, purchase, and demolish homes that contain loose asbestos as ceiling insulation. Its Loose-fill Asbestos Implementation Taskforce has identified 28 Local Government Areas, where a company trading as ‘Mr. Fluffy’ installed the toxic substance in residential properties throughout the 1960s and 70s. The LGAs identified include metropolitan and regional areas throughout NSW.

A roof containing loose-fill asbestos

The NSW Government is offering free testing of potentially affected properties before 1 August 2016. Unfortunately, testing is not available for tenants directly, as it must be organised by the property’s owner. Registration for testing is available online, or by contacting Service NSW.

Compensation may be available for tenants of properties that are purchased and demolished under the scheme.

Relocation assistance up to $1000 will be provided to any tenant “named on the residential lease”. It is unclear whether tenants with an oral and/or implied agreement with the landlord would be eligible. These constitute residential tenancy agreements to the same extent as those whose agreement is recorded in writing, per Section 13 of the Residential Tenancies Act. This requirement would also seem to exclude sub-tenants. We hope to clarify these ambiguities soon. 

Tenants are also eligible for compensation up to $1000 for the replacement of “soft furnishings and or/porous materials like clothes, curtains or linen” that are exposed to loose-fill asbestos. Only household items kept in contaminated areas will need to be replaced.

Fair Trading’s website identifies demolition as “the only way to remove the health risk of loose-fill asbestos insulation from an affected property”.

Tenants who suspect their home may be affected should contact their Local Tenants’ Advice and Advocacy Service for assistance. 

Contact details for the relevant general services are as follows:

- Illawarra and South Coast Tenants Service: 4274 3475
- Northern Sydney Area Tenants' Service: 8198 8650
- Southern Sydney Tenants Advice and Advocacy Service: 9787 4679
- South Western NSW Tenants Advice and Advocacy Service: 1300 483 786
- Western Sydney Tenants' Service: 8833 0933

Aboriginal tenants may also contact the following Aboriginal services:

- Greater Sydney Aboriginal Tenants Service: 9698 0873
- Southern NSW Aboriginal Tenants Advice and Advocacy Service (Murra Mia): 4472 9363
- Western Aboriginal Tenants Advice and Advocacy Service: 6884 0969

Fair Trading NSW is also hosting free information sessions in select locations; check their events register.

Still making sense of sales

Fair Trading NSW has just released its latest edition of The Letterbox - this time it's all about "privacy and access"...

Now, just like in the last issue, the latest Q & A session includes some comments that we're not so comfortable with.

Q: What rights do tenants have when the owner is selling the property and requires frequent access for inspections? Can tenants be asked to leave during inspections?

A: If a landlord wants to sell a rental property, the tenant must be given 14 days written notice before the first property inspection. If the landlord intended to sell the premises but did not inform a new tenant of this fact before the lease was signed, the tenant can terminate the lease with 14 days notice and doesn’t have to compensate the landlord.

Okay. We agree, but we think they've forgotten to include a closing sentence of considerable importance:

"If the landlord had no intention to sell the premises when the tenancy agreement was signed, and only later decided to sell, then once so informed the tenant can terminate the lease with 14 days notice and doesn't have to compensate the landlord."

By way of explanation, we refer to this previous post on The Brown Couch, where we extracted a relevant passage from the CTTT's decision in Kutzner v Kamp (NSWCTTT unreported). We reproduce this passage here again:

The issue for determination is whether in these circumstances the tenants were entitled to give notice of termination under section 100(1)(c) of the Residential Tenancies Act 2010. I am satisfied that it is not a requirement of this provision that the landlord must have an intention to sell the property at the time of entering into the residential tenancy agreement which was not disclosed. It is only necessary for the landlord to have notified the tenant of such an intention during the fixed term without notice prior to commencement of the tenancy. "Disclosure" in the sense used in s100(1)(c) does not mean disclosing what was known to the landlord but rather whether prior notice had in fact been given of the landlord's subsequent decision.

The question arising upon the Tenant being told of the intention to sell, is whether the Tenant had been told at the commencement of the tenancy that this would happen. It is not an answer to say that the landlord did not know then that this would occur.

It is our view that Kutzner v Kamp is based on a correct interpretation of the law.

As has been noted in comments on our earlier posts, and in conversations with tenants' advocates across New South Wales, Fair Trading NSW has sometimes given information to tenants that is not consistent with the decision in Kutzner v Kamp. To that end, it is disappointing, but not surprising, to see the information published today in The Letterbox.

On the other hand, the CTTT's annual report for 2010/2011 includes the following case study on page 35:

Click on the image to enlarge

You can find more information about what to do when the landlord wants to sell here, here and here.

As with all things, if you are not sure about a situation with your tenancy, contact your local Tenants' Advice and Advocacy Service for a chat. You can find their details here.

Maintaining relations and tenants' alterations

By now we expect you will have received and devoured the latest edition of Fair Trading NSW's monthly e-newsletter on all things residential tenancy, The Letterbox. If you haven't already done so, now is as good a time as any to sign up to have it delivered straight to your inbox.



Each month The Letterbox undertakes to answer questions from tenants and landlords about a particular aspect of NSW's renting laws. We were particularly interested in the current issue, because it covers alterations to premises. We were rather hoping that Fair Trading would mention some of the likely implications for tenants and landlords of the coming rollout of the National Broadband Network... Alas, they did not.

But we did get an interesting little snippet that's caused a bit of a stir over here on The Brown Couch. The Q & A session provides:

What responsibility does the landlord have during the tenancy to maintain alterations made by the tenant?

None. Unless the landlord agrees otherwise, the tenant is responsible for the cost of installing and maintaining any fixtures they add to the premises.

On the face of it, we can't be so sure.

The common law of property says that once a tenant affixes an item to real property it forms part of the 'landlord's inheritance', until such times as it is properly removed by the tenant (ie according to a set of developed rules) [Bain v Brand (1876) 1 App Cas 762]. Put simply, a tenant retains a limited right to remove a fixture that they have added, but while ever it remains affixed it is the property of the landlord.

The Residential Tenancies Act 2010 does not include anything that would unambiguously displace this common law principle, and it offers no clear guidance on the maintenance of tenants' fixtures.

The Act does set out some pretty clear rules about how and when a tenant can install or remove a fixture. Included in these rules are provisions that state:

66(4) A fixture installed by or on behalf of the tenant, or any renovation, alteration or addition to the residential premises by or on behalf of the tenant, is to be at the cost of the tenant, unless the landlord otherwise agrees.

67(3) Despite subsection (1), a tenant is not entitled to remove a fixture without the consent of the landlord if the fixture was installed at the landlord’s expense or the landlord provided the tenant with a benefit equivalent to the cost of the fixture.

These provisions could be interpreted to displace the common law - but for this to be so we'd need to accept a broad definition of the word "cost". If it refers to ongoing costs of upkeep, as well as the one-off cost of installation, then Fair Trading's contention about maintenance responsibilities of tenants' alterations could hold true. But this may be a bit of a stretch, because neither of these provisions contemplate the ongoing maintenance of a fixture - they deal only with installation and removal.

The Act also sets out the landlord's repair obligations - in which the definition of residential premises includes:

everything provided with the premises (whether under the residential tenancy agreement or not) for use by the tenant (s62).

Perhaps this definition displaces the common law, by excluding tenants' fixtures from the definition of 'residential premises'. If this is so, then the landlord's repair obligation would not extend to tenants' fixtures, because the obligation is to maintain the residential premises, as defined to exclude anything the landlord has not provided, in a reasonable state of repair. Accepting this exclusion would require a narrow take on the phrase "provided with the premises" - that is, an alteration made by the tenant, with the landlord's consent, would have to be seen as something that was not "provided with the premises". It is not clear that this interpretation could be universally applied to every conceivable set of potentially relevant circumstances.

There is one thing we can be sure of. The Act says:

63(3) A landlord is not in breach of the obligation to provide and maintain the residential premises in a reasonable state of repair if the state of disrepair is caused by the tenant’s breach of this Part.

Clearly, a tenant who alters premises without first obtaining the approval of the landlord cannot expect the landlord to help out with repairs and maintenance of that alteration...

But what of the tenant who does obtain the landlord's approval? Indeed, how will a landlord respond to a request to alter premises if they believe they may be liable for its upkeep?

The key message from all of this, it seems, is to make sure you reach a complete agreement with your landlord before you make any alterations to your premises. In particular, be clear from the outset whether you intend to one day remove the fixture, or to leave it behind at the end of your tenancy. Because if you are to ultimately make a gift to your landlord, it would be wise to factor in and reach agreement as to who will be responsible for the ongoing upkeep of your alteration during the course of your tenancy.

Which really brings us back to The Letterbox Q & A.

Unless the landlord agrees otherwise, the tenant is responsible for the cost of installing and maintaining any fixtures they add to the premises.

This may simply be a case of Fair Trading taking an optimistic view of the law as it stands. Sure, it's easy to explain, but we bet it's even easier to sell to all those landlords who cried foul when the idea of "no unreasonable refusal for minor alterations" was first raised. If it is as simple as all that, we'll be surprised. Then again, perhaps we're just being picky.

Regardless, it's always a good idea to be clear on what you're agreeing to whenever you set out to alter the status quo.