Mere disturbance of the peace not nearly enough for damages claim in VCAT

A bitterly fought VCAT case has concluded, where a lot owner residing in her unit was found to have breached the rules of the owners’ corporation (OC) by engaging in acts of screaming, yelling, wailing and thumping for extended periods of time.

But the case was dismissed as the applicant property manager did not engage in the OC’s dispute resolution process properly.

The applicants were the owners of several units on the third floor of a residential building in Carlton.

The respondent lot owner also lived on the third floor of the building. The lot owners brought a claim for $115,000 in lost rent, stating that the respondent lot owner’s behaviour meant that they could not rent their units as they could not ensure they could provide their tenants with quiet enjoyment of their rented premises.

They said the lot owner engaged in conduct which involved loud and prolonged screaming and yelling, including the use of bad language, and the banging of doors and the throwing of objects.

The hearing took place over four days and both sides were represented by counsel. Several witnesses were called and cross-examined.

A resident living in a different building in Carlton gave evidence that he had been living there since 2022, and described the noise as "wailing; piercing, aggressive, violent and hysterical screaming", and "yelling, foul language, and banging on the window.”

He gave evidence that the disturbance was “incessant” and frequent (around three to four days per week) and, on some days, could go on for “five hours straight.” He stated that he called Victoria Police about 100 times and that the police attended most of the time. However, he stated that when the police would leave, the behaviour would resume.

In evidence, the property manager stated that she had reached out to the lot owner’s father for assistance with resolving the complaints about the yelling and screaming. The lot owner’s father had apparently agreed that his daughter’s behaviour was disruptive at home, and buying the apartment for his daughter was his way of resolving the issue. Although at the hearing the father adopted the view he could not remember that particular conversation with the property manager.

The lot owner ran a defence that despite the above, the lot owners had failed to mitigate their losses against her by not even attempting to advertise the units. They also should have engaged in a grievance committee process with the OC, and if that failed to resolve the issues, then they could have filed in VCAT at an earlier time. She took the position that the lot owners’ failure to follow this process, was a complete abrogation of the duty to mitigate and deprived them of any right to damages.

VCAT agreed, noting that the pattern of disruption started in 2018, and continued in 2019 and 2020. With the COVID border lockdowns in 2020 and 2021, VCAT took the view that the border closures, and the high occupancy rates were also factors in their decision to not advertise the units for rent, and not solely due to her behaviour.

VCAT said, “I consider it more likely than not that, in 2021, the applicants assessed a range of factors when they made the decision not to advertise and not to offer the units for rent, and that those factors included the behaviour of the respondent and the high vacancy rates caused by the border closures.”

“I am also satisfied that both these factors likely played some part in their decision to not advertise the units. Whatever the reasons, I find that the applicants’ conscious and deliberate decision to not advertise and to not offer the units for rent was the cause of the applicants’ loss rather than the respondent’s disruptive behaviour.”

The lesson for owners and OCs in this sorry saga is to always utilise the grievance committee dispute resolution process, even if it will be a foregone conclusion. •