Rabu, 26 Januari 2011

Dispute Resolution 101

Many tenants of Housing NSW will be familiar with the expression "you owe Housing NSW the following amounts...", having received a written demand for payment of a mysterious 'miscellaneous' charge some time in the last couple of months. "You are now in breach of your Tenancy Agreement, which says you must pay your tenancy charges when they are due ..."

Our spies in the Hunter region have just spotted a good one... A tenant - let's call him Bill - received a letter last week asking him to make good an alleged debt of $2.50. Yes, that's right - two whole dollars, and fifty cents, for an unspecified 'miscellaneous' charge.

Let's leave aside the fact that Bill has an intellectual disability, and started to panic before some friends helped him to figure out what the letter was all about... and let's pretend we don't know that Bill always pays a little extra with his rent to avoid running into arrears...

Of course, both of these things should seem important to Housing NSW, who'd do well to avoid upsetting tenants with frivolous and unsubstantiated letters of demand. But no... what's particularly concerning about this kind of letter is that it is the thin end of the wedge for tenants in dispute with Housing NSW.

The letter continues: "We ask that you start making regular payments again and contact your Client Service Officer ... to discuss a repayment plan to reduce the amount you owe. If you do not take the actions above, we may start the process of terminating your tenancy by issuing a Notice of Termination."

This all seems a bit much for a measly $2.50, and it begs the question - what if Bill doesn't pay? A notice of termination... Really? And then what? An application to the Consumer, Trader & Tenancy Tribunal if Bill doesn't leave?

The Minister for Housing is always quick with assurances that HNSW only ever applies to the Tribunal as a last resort. But when we hear of threats - however general - 'to start the process of termination' over a $2.50 debt, we have to wonder.

Adding grist to this mill, it appears that HNSW doesn't keep track of its Tribunal applications. The Housing Minister recently implied that HNSW uses CTTT data for information about its use of the Tribunal; while the CTTT announced that it routinely keeps data on all applications to the Tribunal, but not any record of their outcomes.

So - we can look up the number of times HNSW has applied to the Tribunal to end a tenancy over a debt in the last three months (over 1,000 times), but we can't check up on their actual strike rate. We don't know how many of these applications are vigorously pursued; we can't tell how many are downgraded from termination to 'specific performance' at the time of hearing; and we don't know how many are dismissed.

A spate of automatically generated letters like the one Bill received last week shows just how blasé HNSW can be towards threatening eviction when trying to recover debts. Anecdotally, we know that HNSW makes many applications to the Tribunal to end tenancies, when really all they want is for their tenant to fix up the rent, or pay the water bill, or start chipping away at whatever 'miscellaneous' charge they're chasing at the time. When they get to the Tribunal, HNSW often settles for an agreement that the debt will be paid in installments.

Despite their assurances, it is hard to believe that HNSW sees the Tribunal as an option of last resort. Indeed, it seems to play a leading role in a rigid and cynical approach to debt recovery and dispute resolution... it starts with a threatening letter, then makes its way with remarkable speed and precision towards the Colosseum.

An artists impression of the CTTT

But the hard way does not always yield as sweet a reward as some polite and courteous negotiation.

As for Bill - he was smart... he called his local Tenants' Advice & Advocacy Service for advice about his alleged debt. Fingers crossed that he can keep this one out of the Tribunal.