All Topics / Help Needed! / Legal Issue – PM approving repairs without Landlord consent

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  • Profile photo of Joanna - New InvestorJoanna – B
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    @joanna-new-investor
    Join Date: 2011
    Post Count: 11

    Hi All,

    Would be very grateful for your assistance in this legal matter.

    Some time ago our Property Manager approved the installation of the Hot Water System to the fee of $1573 without our approval.

    Section 19 of the NSW RTA states that the agent has the right to act on behalf of the landlord in emergencies for costs up to $1000 without approval when reasonable attempt has to contact the landlord has been made.

    Our Hot Water System, which had recently been repaired, stopped working while I was on leave from work. The Property Manager emailed my work address – to which she would have received an out of office automatic response, and when I didn’t respond – sent another email less than 24 hours later with an invoice stating that she had approved the installation of a new system and additionally approved another $150 of garden maintenance to allow the plumber easier access to the HWS location. 

    I don’t believe reasonable attempt was made to contact me, given that my automatic out of office response stated I was out of the office and provided a phone number I could be reached on, and furthermore the cost of the HWS exceeded $1000 – for which the PM is contractually allowed to approve emergency repairs.

    I have repeatedly requested a copy of the 3 quotes they said they received for the works, and questioned why the company that had previously repaired the HWS wasn’t called to investigate the issue and I have never received a direct response to this query.

    Today (over 12 months later) I have received an email direct from the plumber who installed the Hot Water System, who had been given my email address from the Property Manager (I have since changed agencies – due to their total incompetence). Threatening me with legal action and the removal of the Hot Water System unless I paid in full within 7 days.

    My response to this was:

    • The instruction to install the HWS was from the Property Manager and not me and therefore their threat for legal action should be directed to the agency.
    •  have tried to rectify this issue with the PM/Agency and they have never once responded. Therefore, fair notice of their course of action has not been received.
    • The agency has no legal right to hand out my personal details to their third party suppliers.
    • They require approval to access my property, and if an attempt to remove the HWS without my approval is made, they will be trespassing and stealing.

    Out of Principal I feel quite strongly about sticking to my guns on this, however – I am not a Lawyer and I am unsure if I am barking up the wrong tree. Certainly, I cannot afford the legal fees to fight this in court.

    I would be grateful for your feedback. Hopefully within 7 days prior to them removing the HWS!

     

    Profile photo of FreckleFreckle
    Blocked
    @freckle
    Join Date: 2012
    Post Count: 1,680

    Plumber can't enter a property and reposes without a court order.

    Indicate to the plumber that while you sympathise with their situation you are happy to go to court to get this resolved however the RE is the one who commissioned the work not you. 

    From the plumbers side this is a breach of contract – the contract was not with you.

    This is a small claims situation – see here and here

    What I would do is work with the plumber to get this resolved by taking a joint action in the small claims court against the RE's PM. My guess is that a court would find you owe a portion of the liable amount (because you do benefit from a new HWS) and the RE the rest because they've exceeded their authority.

    Profile photo of Joanna - New InvestorJoanna – B
    Participant
    @joanna-new-investor
    Join Date: 2011
    Post Count: 11

    Thanks Freckle, good feedback. I'll contact the numbers in your link provided and see how to proceed from there.

    Profile photo of Shiny_Suit_ManShiny_Suit_Man
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    @shiny_suit_man
    Join Date: 2012
    Post Count: 54

    Good work Freckle, Joanna good luck with the case, sounds like your agency have a lot to answer for, i hope justice prevails!

    Profile photo of Jacqui MiddletonJacqui Middleton
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    @jacm
    Join Date: 2009
    Post Count: 2,539

    Nice one Freckle, useful stuff!  smiley

    Jacqui Middleton | Middleton Buyers Advocates
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    VIC Buyers' Agents for investors, home buyers & SMSFs.

    Profile photo of mattstamattsta
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    @mattsta
    Join Date: 2011
    Post Count: 604

    Freckle, the great advice. It is exactly what Joanna needs to do. I hope it will turn out good and PM will pay the cost they have to  pay.

    Profile photo of TerrywTerryw
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    @terryw
    Join Date: 2001
    Post Count: 16,213

    the agent is your agent. you have given them permission to act on your behalf. if they have done something exceeding their power then they can be personally liable. but what are you seeking in this? was the hotwater system too expensive and do you want a reduction? legal fees will exceed the cost of the hws.

    the plumber probably has clauses in his contract that he retains ownership of the items until paid. he may also be entitled to go onto the property to take his items.

    i would suggest you be very careful how u proceed.

    Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
    http://structuring.com.au/
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    Profile photo of TerrywTerryw
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    double post

    Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
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    Profile photo of FreckleFreckle
    Blocked
    @freckle
    Join Date: 2012
    Post Count: 1,680

    Interesting..

    This is largely contract law (tort) unless specific legislation covers aspect of this disagreement. In the main during a contract dispute an installer of (whatever) can't simply walk in and reclaim the goods even if it states he can on a contract. He still has to get a court order to clarify the situation and where the dispute is at. This was tried some years ago in Auckland by a joinery company that had installed doors, windows, shutters, cabinetry etc in a luxury house. They rolled up early one morning and began removing all their product. A few days later they were ordered by the court to reinstall everything until such time as the matter was resolved in court.

    The small claims process is by comparison almost costless. Here in WA I simply file online when I have a client withhold payment or not pay for whatever reason. Costs about $120 which is added to my claim and the papers are served via registered post. Two weeks later I'm usually paid. Some try to hold out to the death but they always cough.

    The great thing about small claims court is no legal representation if you don't want it and no awarding of legal cost either way. Judgments are usually final so no appeals rubbish etc.

    In a claim the defendant usually gets a few options prior to committing to a tribunal namely; defend, pay part or pay all of the claim. The time frame is usually 4 weeks to respond so that leaves time for the RE and parties to negotiate a settlement.

    If I was Jo I would encourage the plumber to take the action against the RE and then act in a supporting role (no cost) and then go with whatever happens after that.

    Profile photo of FreckleFreckle
    Blocked
    @freckle
    Join Date: 2012
    Post Count: 1,680

    Where is the old system? Was their a credit for it. It's a copper cylinder and worth a few bob as scrap. I would want to be shown why it was replaced and probably assessed by someone else. Food for thought?

    Profile photo of TerrywTerryw
    Participant
    @terryw
    Join Date: 2001
    Post Count: 16,213
    Freckle wrote:
    Interesting..

    This is largely contract law (tort) unless specific legislation covers aspect of this disagreement. In the main during a contract dispute an installer of (whatever) can't simply walk in and reclaim the goods even if it states he can on a contract. He still has to get a court order to clarify the situation and where the dispute is at. This was tried some years ago in Auckland by a joinery company that had installed doors, windows, shutters, cabinetry etc in a luxury house. They rolled up early one morning and began removing all their product. A few days later they were ordered by the court to reinstall everything until such time as the matter was resolved in court.

    The small claims process is by comparison almost costless. Here in WA I simply file online when I have a client withhold payment or not pay for whatever reason. Costs about $120 which is added to my claim and the papers are served via registered post. Two weeks later I'm usually paid. Some try to hold out to the death but they always cough.

    The great thing about small claims court is no legal representation if you don't want it and no awarding of legal cost either way. Judgments are usually final so no appeals rubbish etc.

    In a claim the defendant usually gets a few options prior to committing to a tribunal namely; defend, pay part or pay all of the claim. The time frame is usually 4 weeks to respond so that leaves time for the RE and parties to negotiate a settlement.

    If I was Jo I would encourage the plumber to take the action against the RE and then act in a supporting role (no cost) and then go with whatever happens after that.

    sorry freckle. i disagree with almost everything you have written above. the poster should think carefuly about this as it could be costly and time consuming.

    torts is a different area of law to contracts. a tort is a civil wrong such as negligence etc. whst we have here is a contract dispute. nz law doesmt apply. the poster entered into an agreement with the plumber via the agent. the plumber can sue the poster. the plumber has done the work and is entitled to the money so he would have a strong case. losing would mean a judgme t on the credit report and this would affect all future finance applications for 5 years. the plumber may be entitled to the items as they belong to him. the agreement entered into could allow him to enter the premises to do so. it would not be stealing and the police are unlikely to want to charge him or to even become involved. trespass is a tort so you could possibly sue him if u hadnt given him permission, but this would be costly and unlikely to get you anywhere.

    i would suggest you just pay the plumber and forgetabout it.

    Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
    http://structuring.com.au/
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    Profile photo of jmsracheljmsrachel
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    @jmsrachel
    Join Date: 2012
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    I agree with Terry. Pay the plumber, change pm’s and move on. It could get too costly and messy.

    Profile photo of FreckleFreckle
    Blocked
    @freckle
    Join Date: 2012
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    Terryw wrote:

    sorry freckle. i disagree with almost everything you have written above. the poster should think carefuly about this as it could be costly and time consuming.

    I've never found small claims tribunals costly or time consuming but that may be a matter of opinion.

    Quote:
    torts is a different area of law to contracts. a tort is a civil wrong such as negligence etc. whst we have here is a contract dispute. nz law doesmt apply.

    My mistake. Contract law and tort law used to be fairly similar 20 odd years ago although they do deal with different aspects of civil disputes. Contract law is increasingly being supported by actual legislation although not completely yet. I see this as both a contract dispute (plumber Vs agent) and a tort (agent acting beyond authority)

    My understanding is that within the British realm legal precedents are transferable between jurisdictions. The Auckland case was a bank (who owned the mortgage) moving to protect the asset assigned to the mortgage. My guess is that it may well set a precedent acceptable in Australian courts.

    Quote:
    the poster entered into an agreement with the plumber via the agent. the plumber can sue the poster. the plumber has done the work and is entitled to the money so he would have a strong case.

    Agree

    Quote:
    losing would mean a judgment on the credit report and this would affect all future finance applications for 5 years.

    Yes definitely a risk to some extent. Judgements can be excised from credit reports with a Consent Order or Notice of Discontinuance. Messy though if it comes to that.

    Quote:
    the plumber may be entitled to the items as they belong to him. the agreement entered into could allow him to enter the premises to do so. it would not be stealing and the police are unlikely to want to charge him or to even become involved.

    Agreed but exercising ones rights in this case could be difficult for the plumber. This kind of thing is unusual and the plumber probably understands he's potentially walking into a minefield if he did follow that course of action.

    Quote:
    trespass is a tort so you could possibly sue him if u hadnt given him permission, but this would be costly and unlikely to get you anywhere.

    Agreed. Escalating the issue over such a small amount would be crazy.

    Quote:
    i would suggest you just pay the plumber and forgetabout it.

    Not me. Personally I'm over turning the other cheek. I would pay the plumber (its the likely outcome of a small claims tribunal anyway as I suggested earlier) and sue the RE in the small claims. It's a few dollars and a bit of time. Well worth the exercise just for the learning opportunity.

    Profile photo of Shiny_Suit_ManShiny_Suit_Man
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    @shiny_suit_man
    Join Date: 2012
    Post Count: 54

    I think your right there Joe, at the end of the day the plumber needs to be paid, even though the PM did the wrong thing.  I would take care of that, then look into what can be done about the PM.  Weighing up the costs/time v.s. what i could gain. Then possibly looking at just moving on to a different agent. A lot of valuable info in this topic thanks to Terry and Freckle.

    Good Luck.

    Profile photo of a1macca1macc
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    @a1macc
    Join Date: 2012
    Post Count: 1

    The honorable thing to do is pay the plumber.  He has presumably done a good job and completed the task as requested.  It is unfair he should wait 12+ months to be paid and be spending his time chasing payment!  

    This dispute is between the property owner and Agent.  Fix it between you without affecting a 3rd party.

    Profile photo of TerrywTerryw
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    @terryw
    Join Date: 2001
    Post Count: 16,213
    Freckle wrote:

    My understanding is that within the British realm legal precedents are transferable between jurisdictions. The Auckland case was a bank (who owned the mortgage) moving to protect the asset assigned to the mortgage. My guess is that it may well set a precedent acceptable in Australian courts.

    Foreign judgments are not binding in australia. Not even british judgments. They can be looked at by australian courts and noted. But they are not australian law unless the high court uses the principles in a judgment and then’makes’ it law.

    Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
    http://structuring.com.au/
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    Lawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://Terryw.com.au/

    Profile photo of TerrywTerryw
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    @terryw
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    It may be possible to take the agent to a small claim court and it may be very cheap to do so without much financial risk. But consider what could happen if there was an appeal to a higher court. Things can escalate.

    When you go to court you generally lose, even if you win

    Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
    http://structuring.com.au/
    Email Me

    Lawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://Terryw.com.au/

    Profile photo of Scott No MatesScott No Mates
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    @scott-no-mates
    Join Date: 2005
    Post Count: 3,856

    If I were the tradie, I would utilise the Security of Payments legislation to recover the payment ie it doesn't apply to your PPOR however you are not protected if it is an IP. They have completed the work at the direction of the agent (your representative) and have a legal right to be paid. 

    If contractors had no right to get paid because an agent exceeded their authority, how many would be be bothered doing repairs/maintenance/installations for real estate agents? The plumber is not aware of any arrangement you may have with regards to limits on the cost of works permitted to be approved by the agent so your only recourse would be against the agent.  

    Profile photo of colinnewlandcolinnewland
    Participant
    @colinnewland
    Join Date: 2006
    Post Count: 128

    I would also lodge a claim with the State RE Board with a claim that the agent exceeded their written authority. You should be able to get back the difference from the amount that you authorised and the amount spent.

    In any new contract, I  would also set out what is defined as an 'emergency'. An item of repair may be urgent (repairing a water heater but it is not imperative that it be attended to immediately (like a roof being torn off in a storm).  

    Also ensure that ant PM has several contacts for you (land line phone, mobile, fax, emails [work and private]).

    Also make sure that the agent records EVERY action as a file note on your property, including date, time, discussion points etc on phone calls, fax sent reports from the fax machine (as a matter of course, attached to every attempt to send a fax).

    Review every file note by ensuring that the RE agent sends PDF copies of EVERY event/action they deal with in regard to your property.

    Get a copy of the previous repair report and the current report that required the change to a new hot water system.

    Trust BUT Check (everything!).

    Profile photo of FreckleFreckle
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    @freckle
    Join Date: 2012
    Post Count: 1,680

    Can only appeal on lack of jurisdiction or denial of procedural fairness not judgments. Appeals are rare.

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