Mould problems

Discussion in 'Property Management' started by Tabby, 24th Jan, 2020.

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  1. Tabby

    Tabby Member

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    Hi I’m hoping to get some advice

    I have a one bedroom unit in Sydney which I rent out. 8 weeks ago the tenants complained to the PM that one of the walls became mouldy. The strata manager arranged testing. It wasn’t a straight forward issue so they had to test multiple areas, drilled in the walls, ripped out some skirting boards etc. The testing took 8 weeks, which this time, the strata manager had to communicate with the tenants to gain access for testing. Now that they’ve found out the problem is a leaky pipe, the repair work can begin.

    The tenants said to the PM that they want to break the lease and they want compensation. My PM offered them breaking the lease without penalty. They did not accept the offer and said they will go to tribunal if we don’t compensate. The PM suggested we pay them $1200 for the use of the room over the 8 weeks that they’ve been affected. They are currently paying $595 weekly rent.

    Do you think I should compensate them as suggested by my PM? I heard that the tribunal usually side with tenants...
     
  2. Scott No Mates

    Scott No Mates Well-Known Member

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    What has been determined to be the cause?

    Did the PM act straight away or fob it off?
     
  3. Tabby

    Tabby Member

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    The cause was a leaky pipe. The PM offered them the break the lease without penalty and was confident that they would take the offer. But they declined and wrote a pretty aggressive email demanding compensation otherwise they will take it to tribunal. The PM then said to us she strongly recommends compensating because she believe that going to tribunal will result in further compensation
     
  4. Scott No Mates

    Scott No Mates Well-Known Member

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    Did the agent arrange repair without delay or did the tenant take time in notifying the agent ie mitigate damage?

    If the tenant waited or didn't advise then the offer of break lease could be more than reasonable.
     
  5. Michael Mitchell

    Michael Mitchell Property Manager Business Member

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    No. Let them go to the effort of taking you to xCAT. The tribunal is not to punish - merely aims to make things equitable if a loss has occurred, in that regard, any compensation if payable would be awarded at a reasonable rate, for all you know could be a lot less than what they're asking for - have they even presented reasons for the $ number or did they just pluck it out of thin air? Every tenant these days has been conditioned to think they're a victim and every Landlord is being pressured into thinking they owe the tenants something. Has a loss or reduction of amenity actually occurred - it doesn't sound like it. It just sounds like the tenant is going off on a fishing expedition and bluff patrol and your PM is perhaps not experienced in these matters. Empathize, focus on what you can do and are willing to do, but don't go off the deep end offering them money back - they were still living there and making use of the place. The fact access was required to undertake maintenance even over a protracted period of time does not magically grant them compensation, maintenance is a standard part of maintaining any property and the Act allows this to take place.
     
    Last edited: 24th Jan, 2020
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  6. Ted Varrick

    Ted Varrick Well-Known Member

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    Is this a strata issue or not?

    Also, did the tenant unreasonably delay access, as 8 weeks doesnt look good, from the time of original complaint?

    If so, as they have declined the offer of no break fee, then claim the entire break fee from them.

    And, if they want to go to Tribunal, it will cost you a few bucks (given your indicated weekly rental), but they will take some bark off as well...
     
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  7. Joynz

    Joynz Well-Known Member

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    Which wall was mouldy (I.e. bedroom, living room etc?)
     
  8. Tabby

    Tabby Member

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    Yes it is a strata issue and it took them 8 weeks to figure out what the cause was because it wasn’t straight forward according to the PM. Tenants didn’t deny access, maybe strata was a bit slack. Is it possible to claim loss of rental income against strata management? I have landlord insurance but I’m pretty sure it doesn’t cover loss of rental income due to strata issues. I’m very inclined to take back my offer of no break fee and make them stay until the issue is fixed and go to tribunal. At least the rent period will be covered while this thing is being fixed
     
  9. Tabby

    Tabby Member

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    One wall in the living room is mouldy but they had to drill in a few places in the kitchen and the living room to determine the cause
     
  10. Tabby

    Tabby Member

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    The number is actually suggested by the PM not the tenants. She said it’s the area of the room x 8 weeks (over the period which they’ve been affected). I agree with you, it only costs them application fees to make a claim against us. They have nothing to lose and I think the PM is taking an easy way out since it’s not her money on the line. I’m inclined to go to take back the offer of no break fee and go to Tribunal if necessary. I am worried that it will result in more significant compensation but I’m tired of tenants bullying us into giving them free rent
     
  11. housechopper2

    housechopper2 Well-Known Member

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    Perhaps go back one time with the offer of no break fee, but if they confirm they are taking you to tribunal that offer is rescinded?

    Give them one last chance to leave amicably. You’ll look better if it comes to tribunal showing you left that offer open to them too.
     
  12. Ted Varrick

    Ted Varrick Well-Known Member

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    This is getting a little messy.

    Mould, generally speaking, is normally a ventilation issue within the lot, and is not a strata issue.

    You should be having a discussion with your Landlord Insurance provider, just in case.

    Is the leaky pipe within the lot, or in the slab (which, again generally speaking, is common property in NSW), and has the strata manager or committee provided you something in writing admitting their fault or liability? If not, it's going to get a bit more messy.

    In any case, the Owners Corp are not really on the hook to provide compensation to you for rectifying faults in common property, but they do have an obligation to get the issue fixed, which could also incur significant costs for you, in terms of waterproofing, re-tiling (if not original tiles) and painting. (This might help: NSW: Q&A Lot Owner Repairs Due to Common Property Defects ).

    And from your original post where the PM offered to break the lease without penalty, this is a discussion that you should be having with them, depending on whether or not there is a clause in your PM Agreement in relation to unilaterally acting on your behalf or not. If not, the PM should be contacting the tenant, in writing would be good (copied to you), revoking that offer as it was outside their "...role, due to an..." <eyeroll> "...inadvertent administrative error". You should then be having a discussion with the PM as to what contribution they will be making to the costs of the forthcoming Tribunal dustup.

    FWIW, if the tenant decides to stop paying rent, then this will be a very bad look for them in Tribunal.

    Also, note that going to Tribunal (in NSW) on strata issues is like spinning a chocolate wheel.
     
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  13. TMNT

    TMNT Well-Known Member

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    this may be true but from my personal experiences, and every other persons anecdotal experience, the tribunal is very pro tenant,

    anything 50/50 you will lose,

    so unless its a clear breach or illegal/against regulation, you are pretty much stuffed,

    in one of my cases, TLDR, tenant kept on telling me the less than 2 year old oven was broken, wasnt hot enough, manufacturer replaced it with a new one, next complaint was it got too hot (its a oven FFS)
    this was followed by refusal to pay any rent/half rent (i cant recall),
    they then demanded a qualfiied electrician come and test it, PM told them if the test revealed it wasnt faulty, they would liable, they agreed,
    went to tribunal, electricians report cost not given, no back rent awarded, they then judged that the tenant had 2 weeks to pay full rent or they are out
    2 weeks went by no rent paid,
    back to tribunal,
    their judgement, 1 month to leave, of which they have to pay half rent

    I have no faith in the tribunal system for LLs
     
  14. Michael Mitchell

    Michael Mitchell Property Manager Business Member

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    I've found the tribunals to be very fair and when you get a basic understanding of how the law works and is applied, especially the principal of 'betterment' and how to conclude compensation owing, and evidence required, the system is very fair to the point you can almost predict the outcome...

    upload_2020-1-30_14-27-4.png
     
  15. TMNT

    TMNT Well-Known Member

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    I dont really see any remote fairness in my example above, let alone any legal obligiation to release an arreara tenant out of their obligation, followed by paying half rent, followed by free rent , after they have failed to adhere to a tribunal ruling
     
  16. Michael Mitchell

    Michael Mitchell Property Manager Business Member

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    I actually didn't read your scenario, just replied to your first comment. Having read your scenario there's a few things,

    1. Unless it's malicious/negligence, if a tenant reports a "maintenance issue" and it's at least semi valid, even if it turns out to be a non-issue, it's unlikely this would be awarded against them as they have an obligation in their lease to report maintenance issues (that's why it's always good for the Lessor/Agent to have a basic understanding of maintenance stuff and go check it out first).

    2. Without seeing your submission and supporting documentation, it sounds like you may not have handled your application correctly or with the right strategy. Unless the Adjudicator awards rent abatement, rent is almost always recoverable - maybe not in that hearing if a claim for it wasn't specified in the application, but you can go back in future hearings and/or also use the bond claim process/[DR->xCAT] hearing as another avenue to claim.
     
  17. TMNT

    TMNT Well-Known Member

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    1. The continual complainint and serial complaining was definitely factor. One of the complaints about the other handyman was "he wasnt wearing a uniform and didnt look professional enough"

    2.
    It was all done via the agent, so i thought i would walk away with all the tradie invoices, arrears, and immediate to shortest possible eviction, none of this 2nd or 3 rd chances

    So naturally im super annoyed