Understanding QCAT Applications for Compensation: Protect Your Rights!

QCAT APPLICATIONS FOR COMPENSATION AND THE LIMITATION PERIOD 

We have visited this area before, however considering the pressures of cost of living, we are seeing more and more that landlords are saying to their property manager ‘I don’t want to waste more money going to QCAT. Just get the tenants to pay their debt’. We understand that. A loss has already been incurred. Why spend more money and increase that loss? 

Well, there are a few reasons. 

At the end of the tenancy, the tenant ledger may show that the tenants are liable for several things, such as arrears of rent, cleaning, repairs, etc. That is certainly a debt. 

However, there is a vast difference between a ‘debt’ and an ‘enforceable debt’. 

A debt on paper cannot be enforced legally. In fact, the Australian Securities and Investment Commission and the Australian Competition and Consumer Commission’s guidelines on debt collection state that if a debtor denies the existence of a debt, then all debt collection processes must cease. 

However, if there is a decision made by QCAT that a tenant must pay a certain sum for compensation, then that becomes an ‘enforceable’ debt – in other words legal proceedings can be taken to have the tenant pay the amount. Once that decision has been made, a tenant cannot deny the existence of a debt and the guidelines referred to above do not apply. 

Strict time limitations to making an application to QCAT for compensation apply. 

Section 419(3) of the Residential Tenancies and Rooming Accommodation Act (2008) (Qld) (RTRA) provides that an application about a breach of an agreement must be made within 6 months after the lessor or tenant becomes aware of the breach. 

Several decisions of QCAT have made it very clear that there is no jurisdiction to extend that 6-month limitation period (e.g. Place West Rentals v Brooks & Anor [2012] QCAT 511). That means that if that 6-month limitation period has expired the lessor loses the right to obtain an order. 

Particular attention must be paid to section 419. It specifically refers to the 6-month period running from the date the lessor becomes aware of the breach. In many cases a lessor will not become aware of a breach until after the tenant has vacated. However, in others, the breach will occur before the tenancy has expired. The limitation period runs from that date, not from the date of vacation. This can often prove tricky in working out what date the limitation period actually expires. 

However, it is not all ‘doom and gloom’. 

In order to lodge an application for compensation to QCAT (which is considered a non-urgent application), a prerequisite is that a conciliation number must first be obtained from the Residential Tenancies Authority (QLD). This is achieved by lodging an RTA From 16. 

We have often heard I stated that here is no point in lodging Form 16 because the bond had already been disbursed by the RTA. That is not correct. As stated above, it is a prerequisite to lodging an application with QCAT that a conciliation number be obtained. Even if the bond has been released, the RTA will, upon receipt of a form 16, issue a notice stating that the matter is not suitable for conciliation and issue a conciliation number. (the consequences of failing to obtain a conciliation number will be discussed in a later post). 

So apart from satisfying the requirements of filing an application in QCAT, why is obtaining the conciliation number so important. 

The simple answer is that upon obtaining that number, then the lessor is deemed to have commenced the QCAT application process and, provided it is done withing that 6-month period, will have safeguarded against the limitation period expiring. 

This is because section 417 of the RTRA provides that making an application to QCAT includes making a dispute resolution request (form 16). 

The upshot of this is that you should make it a standard part of your termination procedure to lodge the Form 16 with the RTA, irrespective of whether the bond has been dealt with, and irrespective of whether the lessor has said that he/she does not want to apply to the Tribunal. 

By taking this simple step, you will at least have preserved your lessor’s rights to make application to QCAT should it become necessary.