Young v Chief Executive Officer (Housing)

High Court of Australia · 2023

Young v Chief Executive Officer (Housing) [2023] HCA 31

For 68 months an elderly tenant's house had no back door. She was not physically hurt. Could she be compensated for feeling unsafe, and does it matter whether contract damages would have allowed it?

What happened?

Ms Young was a tenant of a house in Ltyentye Apurte (Santa Teresa), about 85 kilometres from Alice Springs, and the Chief Executive Officer (Housing) was the landlord. For 68 months the house had no back door in the doorframe ([2], joint reasons). Her written agreement did not comply with s 19(1) of the Residential Tenancies Act 1999 (NT), so the prescribed agreement applied, with its term that "[t]he landlord will take reasonable steps to provide and maintain the locks and other security devices that are necessary to ensure the premises and ancillary property are reasonably secure" ([3]).

She applied to the Civil and Administrative Tribunal under s 122(1) for compensation, including for distress and disappointment due to the insecurity she felt. The Tribunal held that an external door is not a security device and dismissed that claim ([5]). On appeal the landlord conceded that it is, and that it had failed to comply with the term ([6]); Blokland J awarded $10,200 ([7]). The Court of Appeal set the award aside, reading s 122(1) as importing the common law's remoteness limits and holding that those excluded distress arising other than from physical inconvenience ([8]). Gordon and Edelman JJ record that Ms Young had been "an elderly woman who was left vulnerable to proven animal intruders and potentially human intruders" ([41]), and that she died before judgment ([79]).

What did the Court decide?

The appeal was allowed, order 4 of the Court of Appeal's orders of 4 February 2022 was set aside, and the respondent was ordered to pay the appellants' costs of the first and second grounds of the appeal ([31]). The Court did not fix a new amount: Gordon and Edelman JJ say that any compensation order and any substitute amount belong in the pending appeal to the Court of Appeal on quantum ([78]).

Two sets of reasons were given, and they reach the result by different routes: the joint reasons of Kiefel CJ, Gageler and Gleeson JJ ([1]-[31]) and the joint reasons of Gordon and Edelman JJ ([32]-[78]).

Proposition

What is the principle?

Statutory compensation under s 122(1)(a). Kiefel CJ, Gageler and Gleeson JJ held that the Court of Appeal and the landlord "went too far" in treating the measure of compensation under s 122 as "confined by reference to the measure of damages that could be ordered by a court for breach of that term of that tenancy agreement in a common law action for breach of contract" ([23]). Their Honours accepted that "the statutory language requires an applicant to establish a causal connection between a breach of the tenancy agreement and compensable loss or damage, which may require consideration of issues of the kind that would be addressed in the assessment of damages at common law under the rubric of remoteness" ([20]). But statutory compensation is "an alternative, and likely more accessible, remedy to common law damages" ([23]), and the Tribunal's task is "to arrive at a measure of compensation which conforms to the purposes of the Act and to the justice and equity of the case" ([25]). The feeling of insecurity "was the obverse of the security which it was the purpose of that obligation to secure", and so "readily satisfied the causal connection required by the word 'because'" ([29]). Whether or not the distress would have been compensable at common law, it was compensable under s 122(1)(a) ([30]). Because the appeal succeeded on the first ground, the second ground, which attacked the Court of Appeal's application of the common law principles, "does not arise" ([11]).

Gordon and Edelman JJ disagreed on the first issue and agreed on the result. In their view s 122 adopts the general contract law rules: the limits on recovery "are incorporated in the concept of 'compensation', its award 'for loss or damage', and the requirement that the loss or damage arise 'because ... the other party has failed to comply with the agreement'" ([34]). They then decided the second issue: for breach of a particular term, damages for disappointment and distress "can be recovered only if an object of that particular obligation was the provision of enjoyment, relaxation or freedom from molestation" ([73]), and the object of s 49(1) was "protection of the physical and psychological well-being of the tenant" ([76]).

"Common sense" in causation. In the course of the second set of reasons, Gordon and Edelman JJ said that "[a]lthough causation was once described in this Court as a concept of 'common sense', it has since, and repeatedly, been emphasised that the concept of common sense should be eschewed when applying the principles of causation" ([60]). Footnote 53 gives March v E & M H Stramare Pty Ltd (1991) 171 CLR 506 at 515 for the earlier description. The next sentence says that in the law of contract "the principles related to causation begin with a counterfactual, or 'but for', test" ([60]). This is the reasoning of two Justices, in an appeal about a statute, and the joint reasons do not say it.

Why does this case matter?

Most students meet this case through a footnote in a causation note, which is an unusual way into a decision about a tenancy dispute. The risk is a citation that carries more authority than the case has: a marker reading "the High Court said" will want to know which Justices, in what kind of appeal, and what the appeal turned on.

It is also a case to read from the order sheet outwards. An appeal can be allowed by a bench that does not share a route, and a citation to "the judgment" without saying which reasons is imprecise for that reason alone.

Exam and application relevance

Cite the causation passage to Gordon and Edelman JJ in Young at [60], and add that it was said in construing the Northern Territory tenancy statute. Do not present it as a holding about negligence, and do not cite the joint reasons for it.

On a question about compensation under a statute, ask first what the statute says about the measure of loss and whether it picks up the general law, as the two sets of reasons here answered differently for s 122. The joint reasons do not decide what the common law of contract would have allowed for distress, so do not cite them for the common law limit; Gordon and Edelman JJ at [73]-[76] are the source for that, in their own reasons.

Say nothing about other Australian tenancy statutes from this case.

Check your understanding

1. Whose reasons contain the passage about eschewing "common sense", and what was the appeal about? 2. The two sets of reasons both allowed the appeal. On what point did they disagree, and why does the answer to the second ground not appear in the joint reasons? 3. Gordon and Edelman JJ collect earlier decisions in a footnote to [60]. What can you say about those decisions from this judgment alone, and what can you not?