District Court New South Wales

• Medium Neutral Citation: New South Wales Land and Housing Corporation v Cain [2013] NSWDC 68
• Hearing dates: 22, 23 May 2013
• Decision date: 23 May 2013
• Before: Gibson DCJ

Decision

(1) Appeal allowed.

(2) Order of the Consumer Trader and Tenancy Tribunal dated 19 November 2012 set aside.

(3) An order pursuant to s 91(1)(a) and (3) of the Residential Tenancies Act 2010 terminating the residential tenancy agreement between the plaintiff as landlord and the defendant as tenant in respect of the premises at 28/129 Bundock Street, Coogee with immediate effect.

(4) An order in favour of the plaintiff pursuant to s 91(1)(a) and (3) of the Residential Tenancies Act 2010 for possession of the premises at 28/129 Bundock Street, Coogee with immediate effect.

(5) Order (1) - (4) stayed for 28 days.

(6) Exhibits returned.

• Catchwords: LANDLORD AND TENANT - appeal from CTTT - tenant pleads guilty to offences of drug supply under Drug Misuse and Trafficking Act 1985 (NSW) - landlord gives tenant termination notice under s 91(1)(a) Residential Tenancies Act 2010 (NSW) - CTTT refuses to terminate the tenancy as it may hinder the tenant from completing health and rehabilitation programmes which were part of her sentencing - whether s 91(1)(a) mandatory - whether Tribunal Member had a discretion to exercise - whether exercise of discretion erred
• Legislation Cited: Crimes (Sentencing Procedure) Act 1999 (NSW); Drug Misuse and Trafficking Act 1985 (NSW); Interpretation Act 1987 (NSW), s 9(1); Residential Tenancies Act 2010 (NSW), ss 82, 84, 85, 86, 87, 91, 115 and152; Residential Tenancies Bill 2010 (NSW)
• Cases Cited: Deputy Commissioner of Taxation v Lincoln Industrial Cleaners Pty Ltd (1975) 2 NSWLR 499; Finance Facilities Pty Ltd v Federal Commissioner of Taxation (1971) 127 CLR 106; House v The King (1936) 55 CLR 499; Houssein v Under Secretary, Department of Industrial Relations and Technology (NSW) (1982) 148 CLR 88; Howard v B Miles Womens Foundation Inc [2012] NSWSC 1173; Julius v Bishop of Oxford (1880) LR 5 AC 214; Leach v R (2007) 230 CLR 1; Lugg v Wright [1941] SASR 106; Lyford v Commonwealth Bank of Australia (1995) 130 ALR 267; Mitchell v R (1996) 184 CLR 333; Owens v Australian Building Construction Employees' and Builders Labourers' Federation (1978) 46 FLR 16; Ward v Williams (1955) 92 CLR 496
• Texts Cited: DC Pearce & RS Geddes, Statutory Interpretation in Australia (7th ed.); Residential Tenancies Bill 2010 (NSW) (Second Reading Speech, 8 June 2010)
• Category: Principal judgment
• Parties: Plaintiff: New South Wales Land and Housing Corporation; Defendant: Kerry Anne Cain
• Representation: Plaintiff: Mr R Ranken; Defendant: Mr A K Flecknoe-Brown; Plaintiff: Housing NSW; Defendant: Tenants Union of NSW Co-op Ltd
• File Number(s): 2012/390440
• Publication restriction: None

Judgment

1 The plaintiff (by Summons filed on 17 December 2012) appeals from a decision of the Consumer, Trader and Tenancy Tribunal ("CTTT") dated 19 November 2012 declining to make a termination order of the tenancy between the plaintiff and the defendant pursuant to s 91 Residential Tenancies Act 2010 (NSW) ("the Act").

2 The plaintiff submits that the CTTT made an error of law when it refused to make a termination order pursuant to s 91(1) of the Act in respect of the residential tenancy agreement between the Plaintiff (as landlord) and the Defendant (as tenant). This was despite the CTTT being satisfied (in accordance with s 91(1)(a) of the Act) that the tenant had intentionally caused the use of those residential premises for the purposes of the supply of a prohibited drug within the meaning of the Drug Misuse and Trafficking Act 1985 (NSW).

3 A "termination order" is defined in s 80 of the Act as "an order terminating a residential tenancy agreement together with an order for possession of the residential premises." The defendant's fixed term lease had expired in 2007. The plaintiff would have been entitled to give a termination notice to the defendant under s 85 of the Act, but the termination notice would have had to give 90 days notice. The plaintiff could also have given a termination notice under s 87, on the basis that the illegal activities constituted a breach of the lease, but this would require 14 days' notice and a determination that the conduct amounted to breach of the lease.

4 What the plaintiff did instead was to seek orders from the CTTT under s 91, which provides that where the leased premises are used for illegal purposes (specifically, in s 91(1)(a), for offences such as supply of any prohibited drug under the Drug Misuse and Trafficking Act 1985, not only will a termination order be made, but the notice requirements in ss 85 and 87 do not apply, and the termination order may take effect immediately (s 91(3)). It is a "fast track" remedy to enable landlords to take speedy action in such circumstances.

5 As is set out in more detail below, the CTTT decision appealed from accepted that the defendant's conduct was "a very serious breach" of the tenancy agreement, which satisfied the requirement of s 91(a). However, the CTTT member exercised his discretion by taking into account the plaintiff's health and financial problems, and the possibility that the termination "may hinder the respondent" in completing medical and rehabilitation programmes which formed part of the sentencing process. In lieu of a termination order, he made orders that the respondent "comply with the Residential Tenancy Agreement". The issues for consideration on this appeal are essentially whether s 91 confers discretion not to make an order in relation to s 91(1)(a) and, if so, whether the exercise of the discretion was tainted by legal error.

6 The plaintiff argues that the power of the CTTT to make a termination order under s 91(1)(a) in such circumstances is obligatory and not discretionary. If there is a discretion, the plaintiff submits that any discretion relates to the issues for determination under s 91, namely whether the use of the residential premises for purposes within the meaning of the Drug Misuse and Trafficking Act 1985 (NSW) had been proved, and if so, whether an order for possession should take effect immediately. Alternatively, the plaintiff submits that if the CTTT has discretion to refuse to make an order where s 91(1)(a) is satisfied, the exercise of that discretion was infected by legal error because the CTTT had regard to extraneous or irrelevant matters in making that decision (the health and financial circumstances of the defendant), or alternatively made them in conflict with the fact-findings in the case where that finding of fact was so contradicted as to amount to an error of discretion.

7 The defendant submits that s 91(1) of the Act conferred upon it not only a power to make a termination order, but a discretion not to exercise that power. The Tribunal member properly exercised his discretion in that respect, by declining to make a termination order in this case. The Tribunal Member was entitled to have regard to the personal circumstances of the defendant and to the course of action, which was taken by a Judge of this Court in adjourning criminal proceedings against Ms Cain so as to allow her to demonstrate her rehabilitation. Although he used the word "may", the Tribunal member was entitled to draw a reasonable inference that termination of Ms Cain's tenancy might adversely impact upon her prospects of rehabilitation.

The factual background

8 The facts of the offences as found by the CTTT may be briefly stated. On a number of occasions, police observed the defendant driving a rented vehicle to a two-storey industrial warehouse at St Peters, which were under surveillance, which she entered by unlocking the door. Police entered the warehouse and found three custom made rooms where they located approximately 64 cannabis plants, 23 kilograms of decomposing cannabis leaf, 800 grams of dry cannabis leaf and plant growth products (Exhibit A, Facts Sheet). Police then went to the leased premises, where they seized 1.86 kg cannabis leaf bud (street value $15,000) being dried out in a specially fitted-out cabinet in the kitchen. Police also found $950 in the defendant's handbag. Approximately 20.8 kg of cannabis, in two large bags which police had observed the defendant place into the back of a Toyota Kluger 4WD motor vehicle registered in her name, were also seized. Police had observed the defendant exit the warehouse carrying the two large bags just prior to locating the drugs inside the bags. According to the plaintiff's written submissions, police later located a further 12.5 kg of cannabis inside the premises, which was being prepared for delivery elsewhere.

9 The defendant was charged on 3 August 2011. On 16 August 2011 she was granted conditional bail to reside at the leased premises. On 20 September 2011 the plaintiff commenced the proceedings in the Tribunal, invoking s 91 of the Act.

10 On 9 August 2012, the criminal proceedings against the defendant were heard in this Court. An agreed statement of facts was tendered, and the defendant was convicted. Affidavits were also filed for sentencing purposes. His Honour Judge Berman SC, acting under s 11 of the Crimes (Sentencing Procedure) Act 1999 (NSW), adjourned the proceedings until 7 June 2013, for the purpose of allowing the defendant to demonstrate that rehabilitation had taken place.

11 The Tribunal heard and decided the matter on 19 November 2012. The Tribunal member was informed of the decision of Berman DCJ, and further evidence was put before him of Ms Cain's personal circumstances, upon which the Tribunal relied in making its decision not to make a termination order.

The Tribunal Member's findings

12 The Tribunal Member's findings were as follows:

(a) The respondent was intricately involved in the drug cultivation and supply, evidence such as her being the registered owner of a Toyota Kluger and can drive this vehicle is in conflict with her evidence regarding her financial position and incapacity.

(b) This is a very serious breach of the residential tenancy agreement.

(c) The only redeeming feature is there is no evidence of any business of supply by her at or in the vicinity of the residential premises.

(d) There are significant factors in the personal history of the respondent, which are supported by medical evidence supplied, for which she would be granted some consideration.

(e) The respondent has given undertakings to the District Court on rehabilitation and she should be given the opportunity to demonstrate to the court that she can rehabilitate herself and not rely on cannabis for relief of her back pain.

(f) The termination of the tenancy may hinder the respondent tenant in completing the medical treatment and rehabilitation programmes.

13 The Tribunal Member further noted that:

"The Tribunal takes guidance from the District Court and makes orders for specific performance that that respondent comply with the Residential Tenancy Agreement with the provision to re-list the matter if the respondent fails to comply with such orders."

The structure of the Residential Tenancies Act 2010 (NSW)

14 Both parties agreed that at the time of the events in question, the defendant was occupying the premises pursuant to a periodic agreement, the fixed term having expired in 2007. Both parties agreed that the commission of a criminal offence of the kind to which the defendant had pleaded guilty would amount not only to conduct of the kind defined in s 91(1)(a), but also to conduct amounting to a breach of lease under s 87, which would entitle the landlord to give a termination notice under that provision if it had chosen to do so.

15 The New South Wales Land and Housing Corporation lease the premises in question. This is therefore a social housing tenancy agreement, in which case, in relation to termination of social housing tenancy agreements for breach (s 152 of the Act) and acceptable behaviour agreements (ss 153-154) may be applicable in relation to termination for breach under s 87. This appears to have been agreed to be the case before the Tribunal member, as he was addressed on s 152 factors.

16 These provisions are, however, agreed by the parties to be of no relevance here, because the plaintiff invoked s 91; any breach of agreement (s 152(1)(b)) and its seriousness are matters for which no finding need be made. The plaintiff's written submissions submit that one of the reasons for the Tribunal member erroneously exercising his discretion was that both parties addressed these statutory provisions when it was unnecessary to do so.

17 It would be a simple matter for the plaintiff to have served a termination notice under s 85 (where the sole question is the effluxion of time under the notice provisions) or relying upon the circumstances of the defendant's conviction under s 87(4). Is s 91 a procedural provision designed to speed up this process by pre-determining or dispensing with substantive or procedural steps in these provisions, or does it provide a separate procedure for tenancy termination in which matters such as the tenant's ill health or indigence outweigh serious criminal conduct?

18 The first question for determination is whether the novel interpretation of s 91 by the defendant is correct. The defendant submits that s 91 does not merely dispense with the provision of termination notices to tenants where there is evidence of unlawful activities, but creates an entirely new method for the determination of a tenancy. This raises the question whether s 91 of the Act, which dispenses with the provision of termination notice to tenants (a fundamental right to tenants), sets out an alternative method of terminating a tenancy, or whether it merely streamlines the provisions of ss 85 and 87 concerning findings of breach and the giving of notice. This requires an examination of the role s 91 plays in the Act.

The place of s 91 in the statutory framework of the Act

19 This section is one of a series of provisions which removed the requirement for notice to be given to the tenant. They operate in the context of the provisions for termination of leases under the Act. The relevant provisions are ss 82, 85 and 87 provide the following:

"82 Termination notices

(1) A termination notice must set out the following matters:

(a) the residential premises concerned,

(b) the day on which the residential tenancy agreement is terminated and by which vacant possession of the premises is to be given,

(c) if the notice is not given under section 84, 85, 96 or 97, the ground for the notice,

(d) any other matters prescribed by the regulations.

(2) A termination notice must be in writing and be signed by the party giving the notice or the party's agent.

(3) A termination notice for a periodic agreement may specify a day other than the last day of a period for the payment of rent as the termination date.

85 Termination of periodic agreement

(1) A landlord may, at any time, give a termination notice for a periodic agreement.

(2) The termination notice must specify a termination date that is not earlier than 90 days after the day on which the notice is given.

(3) The Tribunal must, on application by a landlord, make a termination order if it is satisfied that a termination notice was given in accordance with this section and the tenant has not vacated the premises as required by the notice.

(4) This section does not apply to a residential tenancy agreement if the tenant has been in continual possession of the same residential premises for a period of 20 years or more.

87 Breach of agreement

(1) A landlord may give a termination notice on the ground that the tenant has breached the residential tenancy agreement.

(2) The termination notice must specify a termination date that is not earlier than 14 days after the day on which the notice is given.

(3) The termination notice may specify a termination date that is before the end of the fixed term of the residential tenancy agreement if it is a fixed term agreement.

(4) The Tribunal may, on application by a landlord, make a termination order if it is satisfied that:

(a) the tenant has breached the residential tenancy agreement, and

(b) the breach is, in the circumstances of the case, sufficient to justify termination of the agreement, and

(c) the termination notice was given in accordance with this section and the tenant has not vacated the premises as required by the notice.

(5) In considering the circumstances of the case, the Tribunal may consider (but is not limited to considering) the following:

(a) the nature of the breach,

(b) any previous breaches,

(c) any steps taken by the tenant to remedy the breach,

(d) any steps taken by the landlord about the breach,

(e) the previous history of the tenancy.

(6) The Tribunal may refuse to make a termination order if it is satisfied that the tenant has remedied the breach.

Note: Section 152 sets out additional matters to be considered if the residential tenancy agreement is a social housing tenancy agreement."

20 It is in the context of these provisions that s 91 dispenses with the notice procedure set out above, in the following specific circumstances:

"91 Use of premises for illegal purposes

(1) The Tribunal may, on application by a landlord, make a termination order if it is satisfied that the tenant, or any person who although not a tenant is occupying or jointly occupying the residential premises, has intentionally or recklessly caused or permitted:

(a) the use of the residential premises or any property adjoining or adjacent to the premises (including any property that is available for use by the tenant in common with others) for the purposes of the manufacture, sale, cultivation or supply of any prohibited drug within the meaning of the Drug Misuse and Trafficking Act 1985 , or

(b) the use of the residential premises for any other unlawful purpose and that the use is sufficient to justify the termination.

(2) In considering whether to make a termination order on the ground specified in subsection (1) (b), the Tribunal may consider (but is not limited to considering) the following:

(a) the nature of the unlawful use,

(b) any previous unlawful uses,

(c) the previous history of the tenancy.

(3) The termination order may specify that the order for possession takes effect immediately.

(4) A landlord may make an application under this section without giving the tenant a termination notice.

(5) The Tribunal may make a termination order under this section that takes effect before the end of the fixed term if the residential tenancy agreement is a fixed term agreement."

21 Section 91 was one of a series of reforms designed to fast track tenancy termination in specific circumstances such as harassment of a landlord, domestic violence and illegal activities by tenants. In her Second Reading Speech to the Residential Tenancies Bill 2010 (NSW), Ms Jodi McKay, the Minister for Tourism, Minister for the Hunter, Minister for Science and Medical Research, and the Minister for Women, described the provisions of s 91(1)(a) in her speech of 8 June 2010 as follows:

"I would also like to touch on the impact this bill will have in my electorate to better address antisocial behaviour and make victimised tenants in social housing safer. In my electorate, there are over 3,000 social housing dwellings, some in large estates, providing accommodation to many people in need. Regrettably, there are those tenants and their acquaintances, however few, who make life for their neighbours unbearable. I have been approached by tenants who are scared in their own homes because of the behaviour of those living around them. This has been particularly so recently in the Hamilton South complex, where thugs have found pleasure in intimidating others, leaving residents living in fear. Many are too frightened to make reports to police and Housing NSW for fear of retribution. In order to remove troublesome tenants, the case must be made to the Consumer, Trader and Tenancy Tribunal. This process can be slow and frustrating when the fear is so acute. This bill will give Housing NSW extended powers to target behaviours both on and off the estates. I am advised that until now Housing NSW has not had the power to address behaviour outside of the actual residence. The experience of the Hamilton South Working Party, which I instigated as the member for Newcastle, has demonstrated the importance of being aware of the landscape beyond the place of residence. The bill will further allow Housing NSW to take action on tenants who abuse staff, engage in illegal drug activity on the estate, or have children who are exhibiting antisocial behaviour. Currently Housing NSW officers rely on police events or successful convictions to demonstrate antisocial behaviour to the Consumer, Trader and Tenancy Tribunal, in order to evict those engaging in such terrifying behaviour." [emphasis added]

22 I agree with the submissions of the defendant (written submissions, 23 May 2013) that the perceived policy underlying the section (or the Act more generally) is deduced from the words of the Act, and that the statements set out above do no more than give background information.

23 I shall briefly outline the submissions of the parties.

The plaintiff's submissions

24 The plaintiff identifies the difference between illegal activity in s 91(1)(a) and 91(1)(b) as follows. In the case of s 91(1)(a), the CTTT need only be satisfied that the tenant has intentionally or recklessly caused or permitted the use of the premises for the purposes of the manufacture, sale, cultivation or supply of any prohibited drug within the meaning of the Drug Misuse and Trafficking Act in order to make the termination order. In the case of s 91(1)(b), however, where the illegal activity is not specified, the CTTT is required to be satisfied that the tenant has intentionally or recklessly caused or permitted the use of the premises for any other unlawful purpose by undertaking the evaluative exercise in s 91(2) to determine whether that use is sufficient to justify the termination.

25 A landlord seeking termination under s 91, for either supply (s 91(1)(a)) or "other unlawful purposes" (s 91(1)(b)) is not required to provide notice of the kind required by ss 85 or 87(1), or to prove a breach of the residential tenancy agreement as required by s 87. The landlord is only required to satisfy the CTTT that the tenant engaged in the conduct specified in either s 91(1)(a) or s 91(1)(b) and, in the case of s 91(1)(b), that the particular unlawful use was such as to justify termination having regard to the matters in s 91(2). In particular, the CTTT is not required to have regard to matters of the kind specified in either s 87(5) or s 152(1) (except in so far as they are specified in s 91(1) in the case of termination on the basis of s 91(1)(b)).

26 The plaintiff acknowledges the word "may" in s 91(1) prima facie indicates that the power may be exercised, or not, at the CTTT's discretion (s 9(1) Interpretation Act 1987 (NSW)). However, the context of words and circumstances may be such as to make the word "may" really mean "must": Finance Facilities Pty Ltd v Federal Commissioner of Taxation (1971) 127 CLR 106 per Windeyer J at 134-5 approved in Mitchell v R (1996) 184 CLR 333 at 345 and in Leach v R (2007) 230 CLR 1 at 17. The plaintiff relies upon decisions where the court has held that once a finding of fact has been made the court has no discretion other than to grant the relevant relief: Lugg v Wright [1941] SASR 106; Owens v Australian Building Construction Employees' and Builders Labourers' Federation (1978) 46 FLR 16; DC Pearce & RS Geddes, Statutory Interpretation in Australia (7th ed.) at [11.11].

27 The specific reference to the making of a finding in relation to the manufacture, sale, cultivation or supply of prohibited drugs may be contrasted, the plaintiff submits, with the provisions in s 91(1)(b). This means that once a finding under s 91(1)(a) is made, there is no further discretion, on the expressio unius principle. While this maxim is generally applied by the courts with extreme caution (Houssein v Under Secretary, Department of Industrial Relations and Technology (NSW) (1982) 148 CLR 88 at 94), the fact that ss 91(1)(a) and 91(1)(b) sit side by side within the same section of the Act, and deal with the same subject matter of use of premises for illegal purposes, indicates the maxim has application: Deputy Commissioner of Taxation v Lincoln Industrial Cleaners Pty Ltd (1975) 2 NSWLR 499 and Lyford v Commonwealth Bank of Australia (1995) 130 ALR 267 at 270.

28 The plaintiff accordingly argues that s 91(1) obliges the CTTT to make a termination order upon the finding of fact (which is not disputed in this case) that the defendant was involved in drug supply in accordance with the Act.

The defendant's submissions

29 Counsel for the defendant draws my attention to the principles of statutory interpretation set out in Ward v Williams (1955) 92 CLR 496, which he summarises as follows:

(1) Where "a power is deposited with a public officer for the purpose of being used for the benefit of persons who are specifically pointed out, and with regard to whom a definition is supplied by the Legislature of the conditions upon which they are entitled to call for its exercise" (92 CLR at 505-506) - such a factor suggests that the officer is bound to exercise the power.

(2) A related consideration is whether the proceeding exists "for the protection or enforcement of private rights", as opposed to, for instance, where the statutory provisions "are designed to safeguard or serve [interests] enjoyed in the locality by the public at large" (92 CLR at 507-508).

(3) If "the power is conferred upon a judicial tribunal and to be invoked by a judicial proceeding", that may indicate that the officer is bound to exercise the power. That is essentially because "[j]urisdiction and powers are conferred on judicial bodies, usually for the enforcement of rights and the protection of interests" (92 CLR at 507).The obvious contrast is to an administrative decision-making body.

(4) If the decision-making officer "is interposed between" the body entitled to complain about particular conduct and the person against whom the complaint is made, that may be because the decision-maker "is interposed for the protection of the latter: the decision of the [complainant] is not to be conclusive upon" the person against whom the complaint is made (92 CLR at 507).

(5) Where the officer's decision "goes not only to the existence of [the cause for complaint]; it goes also to the propriety or reasonableness of requiring the person notified to abate it. Why should not the [decision-maker's] authority cover the whole area of" the dispute of which the complainant complains (92 CLR at 507)?

(6) Where "sets of facts may fall literally within one or other head [i.e. of the causes for complaint prescribed in the statute] although varying infinitely in degree and substantiality", a discretion may be intended, because "to abate or remove a relatively minor, unimportant or trivial defect may be so costly or difficult as to make it harsh or unreasonable to require it" (92 CLR at 507).

30 The defendant submits, and I agree, that the decision in each case turns upon the particular statutory context, and accordingly reference to other decisions considering terms such as "may", and the nature and extent of the discretion statutorily conferred, would be of limited assistance. It is, however, possible to observe, in the authorities to which he has referred the court, examples of how the considerations summarised above should be applied.

31 The defendant submits that the perceived advantages which a landlord might be afforded upon involving "any one or another of the alternative powers under s 84 to 85 (whichsoever may be available in a particular case)" are "matters for the landlord and for Parliament" (written submissions, paragraph 2(a)). It is irrelevant that the landlord would have been better off, if the defendant's construction of s 91(1)(a) is correct, in using the traditional method of service of a notice terminating the lease under s 85, which are mandatory (Howard v B Miles Womens Foundation Inc [2012] NSWSC 1173 at [16] - [18]), and under which the exercise of a discretion relating to the tenant's health and financial difficulties would not have been issues for consideration. The undesirability of the consequences of a court finding that s 91(1)(a) confers a discretion not to terminate is a matter for decision in "some other future case" and for Parliament (written submissions, paragraph 2(c)). I accept this submission; the question is whether the section does in fact confer the discretion.

32 The defendant submits that, properly construed, s 91(1) does confer a discretion, and describes this discretion as being "on its face unconfined" (written submissions, paragraph 49):

"Where a discretion is on its face unconfined, the question of whether an administrative decision-maker is bound to take into account, or is bound not to take into account, any particular considerations is to be answered by inference from the context, scope and purpose of the statute conferring the power: 2HD (1979) 144 CLR 45 at 49; Browning (1947) 74 CLR 492 at 505; Minister for Immigration and Citizenship v Li [2013] HCA 18 at [23] per French CJ."

33 Illegal activities are not simply a matter of private rights but a matter of public interest. Where tribunal proceedings at the same time as, or after, criminal proceedings, s 91 should be interpreted such that the tribunal's authority may be exercised having regard to the interest of the due administration of justice. The course of criminal justice may produce a range of results. In addition, the landlord's interest may not be prejudiced by the use of the residential premises for illegal purposes (written submissions, paragraph 33). Indeed, "in this case, there is no evidence of any detriment to the landlord or any neighbours" (emphasis added by counsel, written submissions, paragraph 33). The landlord has no immediate right to protect, or liability to avoid in a case such as the present. The landlord should have no fear that it may have criminal liability arising from knowledge that their premises had been used for drug related purposes as the landlord knows that the premises "were once used for such purposes, but it only knows that now as a result of a successful exercise in law enforcement." (Emphasis added by counsel for the defendant, written submissions, paragraph 37). These proceedings have been brought on the basis of past, not current, illegal activities.

34 The defendant submits that, as in Ward v Williams, supra, the CTTT's role is to be interposed between the landlord and the tenant for the protection of the latter, which is why s 91 looks much less like ss 84 and 85, which leave it entirely in the landlord's hands as to whether and when to issue a termination notice, in contrast to the Tribunal, which by reason of the word "may" exercise a discretion.

35 Counsel for the defendant drew my attention to a number of matters on 22 May which he supplemented with a list on 23 May. The submission is that the structure of the Act (items (a) - (e) helps demonstrate that the specific language of s 91 demonstrates the discretion available in relation to s 91(1)(a):

(a) The long title of the Act;

(b) The parts into which the Act is divided (Parts 1 to 12), including their headings;

(c) The Divisions of Part 5, including their headings;

(d) The "general" provisions of ss 80, 81, 82, 83 (i.e. Div 1 of Pt 5);

(e) At least in a general way, each of ss 84 - 85;

(f) The words of each of ss 91(2) to 91(5) and their relationship with s 91(1);

(g) In particular, the use of the word "may" in s 91(1);

(h) The fact that there is no requirement for the landlord to issue a termination notice, which means that the issue is one for determination by the Tribunal;

(i) Any order for possession "may" have immediate effect (s 91(3)), and there are additional protections where the tenancy for a fixed term has not yet expired (s 91(5)).

36 While the landlord's interest are served by allowing the landlord to go directly to the Tribunal for expeditious resolution of the problem, s 91's structure makes it clear that the circumstances might, but will not always, warrant immediate ejection of the tenant. That implies there is a discretion. This is in recognition of the variability of the factual issues in cases coming before the Tribunal. If there were no such discretion, then there would only be one possible order, namely a termination order. Both ss 91(3) and 91(5) are directly inconsistent with s 91(1) being mandatory.

37 In answer to the plaintiff's submissions as to the evaluative nature of the criteria in s 91(1)(b) and its association with s 91(2), the defendant submits:

(a) Section 91(1)(b) is carefully drafted in limited terms. It refers to the use in question being sufficient to justify termination. It does not say that all of the circumstances of the case require termination (compare the criterion at issue in Leach v R). All that s 91(1)(b) is saying is that there must be, at a minimum, an illegal use of the premises of a certain degree of gravity. The only relevance of s 91(2) is in giving the Tribunal guidance in the evaluative process of deciding whether the particular use has the requisite degree of gravity.

(b) That such a "use", taken in isolation, is "sufficient" to "justify" termination does not say that termination is necessarily the right response to the circumstances. That view is consistent with a recognition that, prima facie, commission of the drug-related offences referred to in s 91(1)(a) might justify termination, but do not require it. The function of paragraph (b) is thus exactly the same as that of paragraph (a), and there is no occasion for the application of the expressio unius maxim (cf plaintiff's submissions para 23).

38 For these reasons, the defendant submits that the terms, context, subject matter and purposes of s 91(1) do not suffice to rebut the presumption that the power it confers is discretionary. That discretion does not relate merely to notice proceedings, but to whether termination will be granted at all. Each of ss 84, 85, 86 and 87, and each of the subsections in s 91, confer separate and independent powers on the Tribunal. None of these powers is a gloss on any other. The provisions of s 91 are not designed as a fast track alternative to, for example, s 85 or s 87, both of which could have been used by the plaintiff, but a different process for termination of tenancies, and one which confers significant benefits on the tenant, namely the exercise of an "unconfined discretion", notwithstanding the removal of the notice provisions by reason of the use of premises for illegal purposes.

Conclusions concerning the parties' submissions

39 The determination of issues relating to the construction of statutes turn upon the particular statutory context in each case. The real intention of the legislature must be ascertained, rather than embarking on a course of construing of individual provisions in isolation (Ward v Williams, supra, at 505). The question of how to interpret the word "may" is to be solved from the context, from the particular provisions, or from the general scope and objections of the Act which confers the power (Ward v Williams, supra, at 505, citing Julius v Bishop of Oxford (1880) LR 5 AC 214, at p 235).

40 The discretions given to the adjudicator under s 91(1)(b) clearly relate to the very broad range of conduct which could be encompassed by "unlawful conduct". Such conduct could range from conducting a brothel on the premises, to cases where the nature of the unlawful use was relatively minor and there was a previously good tenancy history. In circumstances such as these, the nature and extent of the unlawful activities are clearly relevant as to whether this streamlined procedure, which provides for the waiving of notice requirements, as well as for the making of an order of an immediate nature.

41 However, the serious nature of the offences under the Drug Misuse and Trafficking Act identified in s 91(1) is such that no further inquiry is required. I accept the submission of the plaintiff that a finding that the defendant had in fact committed the unlawful acts referred to in s 91(1)(a) is sufficient to trigger the issuing of a termination order and that in those circumstances, the section is mandatory, in much the same way that s 84 is mandatory (Howard v B Miles Womens Foundation Inc, supra).

42 This does not mean, however, that the termination order must be immediate. The terms of ss 91(3) and 91(5) do give the CTTT a limited discretion, namely as to whether or not the order should be immediate and (in circumstances not relevant here, since this is not a fixed term) what should happen in relation to such orders where fixed term tenancies have not yet expired.

43 I accept the submissions of the plaintiff that the procedure set out in s 91 is not a true alternative to the process for termination of tenancies set out under sections such as ss 85 and 87 of the Act but should be approached in the same way as Schmidt J reconciled ss 85 and 115 in Howard v B Miles Womens Foundation Inc, supra. Section 91(1) provides a procedure for streamlining those provisions to take into account situations of some urgency, where there may be good reason for not requiring the notice period to have expired before the tenant can be ordered to vacate, or where the landlord may seek orders for re-entry immediately. These provisions apply because of the serious nature of the illegal activity which would result in a termination order under s 91, a situation wholly different to the giving of notice by the landlord to a tenant either for reason of breach (in the form of non-payment of rent) or, where the fixed period has expired, for reasons of convenience of the landlord who may wish to bring the tenancy to an end. They do not, however, introduce a concept of discretion unless that discretion is clearly spelled out, as is the case with s 91(2) concerning "any other unlawful purposes" (s 91(1)(b)).

44 On that basis, I would allow the appeal. I should, however, set out my findings in relation to whether the discretion was infected by legal error.

The exercise of discretion in relation to the refusal to make a termination order under s 91(1)(a)

45 Both parties agree that an appeal against the exercise of discretion is governed by the principles set out in House v The King (1936) 55 CLR 499 at 504-505.

46 I first note that it appears from the transcript that the Tribunal was led into error by reason of the parties mistakenly addressing as to the matters specified in s 152(1) (see pp 10-12 and 15-16 of the transcript in Exhibit A). As a result, the CTTT had regard to a number of subjective considerations concerning the defendant and was influenced by what was said as to the approach being taken by the District Court to the defendant's sentencing proceedings. Whether or not the provisions of s 91(1)(a) permit the exercise of any discretion, this was of itself a legal error. However, the legal error goes much further than being a consideration of factors under s 152(1). The list of factors in s 152(1) do not include a consideration of the tenant's financial hardship or the fact that the tenant is on a disability pension. While the list of factors in s 91(2) is broad, those factors nevertheless relate to s 91(1)(b), not s 91(1)(a). Nor does s 87(5).

47 Counsel for the defendant submitted that if the Tribunal member exercised his discretion in accordance with these other provisions, that would make no difference, as the discretion is "unconfined". I do not accept this argument. These findings were made on the mistaken premise that a s 87 breach had to be proved, and that factors in a social housing tenancy agreement needed to be factored into a s 91(1)(a) tenancy termination.

48 In addition, the ability of the defendant to take part in the sentencing exercise by the District Court in its criminal jurisdiction is a matter for that court to tailor its programme to take account of changes in the defendant's place of occupation. The fact that such orders are in place does not bar the Tribunal from exercising its functions in accordance with the Act, or require the Tribunal to make orders of a specific performance nature in order to fit in with that rehabilitation programme.

49 Further, the exercise of the discretion was in error because it was based on inferences that were no more than a surmise. The highest that the Tribunal Member could put the impact of termination upon the defendant was that such an order "may" impact upon her ability to receive medical treatment and attend rehabilitation programmes. Counsel for the defendant submits that the Tribunal Member was entitled to infer that the defendant would be homeless and unable to find other accommodation, but the Tribunal member notes facts to the contrary in his own judgment.

Concluding remarks

50 The CTTT erred in law in refusing to make a termination order pursuant to s 91 in circumstances where it was satisfied as to the matters specified in s 91(1)(a) of the Act. In addition, the factors taken into account in the exercise of discretion were infected by legal error. I had accordingly made the orders sought by the plaintiff.

51 These proceedings were commenced in the CTTT but not heard until 19 November 2012. This was not the result of delay by the CTTT, but because of a belief that the proceedings had to be stayed until a plea of guilty was entered in the criminal proceedings. This would appear to defeat the purpose of s 91, and may be an appropriate matter for legislative consideration.

52 I was not addressed as to the other orders sought in the Summons, but the defendant has foreshadowed an application for a stay in the event that I allow the appeal.

Orders

(1) Appeal allowed.

(2) Order of the Consumer Trader and Tenancy Tribunal dated 19 November 2012 set aside.

(3) An order pursuant to s 91(1)(a) and (3) of the Residential Tenancies Act 2010 terminating the residential tenancy agreement between the plaintiff as landlord and the defendant as tenant in respect of the premises at 28/129 Bundock Street, Coogee with immediate effect.

(4) An order in favour of the plaintiff pursuant to s 91(1)(a) and (3) of the Residential Tenancies Act 2010 for possession of the premises at 28/129 Bundock Street, Coogee with immediate effect.

(5) Order (1) - (4) stayed for 28 days.

(6) Exhibits returned.

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Decision last updated: 24 May 2013