Background
Vashti Conway and Farshad Amirbeaggi leased a residential property from Quidi Sun and Jianchao He. They alleged defects in the premises and pursued a rent-abatement claim, initially in NCAT and later in the District Court. While that dispute was unresolved, the tenants withheld rent. The landlords obtained NCAT orders terminating the tenancy and requiring vacant possession for rent arrears.
The tenants commenced Supreme Court proceedings to set aside the NCAT orders and obtain relief against forfeiture. In September 2025, Walton J stayed the NCAT orders, restoring the tenants’ possession subject to their paying arrears and continuing to pay rent at the contractual rate. The substantive rent-abatement dispute remained listed for determination in the District Court. After the tenants vacated in June 2026 and paid outstanding rent in September 2026, the Supreme Court proceedings had no practical utility beyond costs.
The Court’s Holding
Harrison AJ dismissed the proceedings and ordered the plaintiffs to pay the defendants’ costs, including the costs of the costs hearing. Although the plaintiffs had succeeded in their jurisdictional challenge to the NCAT termination decision, Walton J’s orders had effectively restored the status quo while requiring payment of all rent arrears and ongoing contractual rent.
The Court held that the proceedings were avoidable: the plaintiffs had withheld rent before any entitlement to abatement had been adjudicated, exposing themselves to termination action. The defendants’ attempt to recover possession was reasonable in those circumstances, and the jurisdictional error in NCAT was not their fault. The pending District Court case was not an appropriate forum to determine the Supreme Court costs issue. Neither side’s later offer of compromise affected the result.
Key Takeaways
- A tenant asserting a rent-abatement claim risks termination proceedings if it withholds rent before that entitlement is determined.
- Restoring possession subject to payment of arrears and ongoing rent was effectively equitable relief for defaulting tenants.
- Where proceedings are dismissed after becoming spent, the usual rule requiring the plaintiff to pay costs may still apply.
Why It Matters
The decision distinguishes between a tenant’s potentially valid underlying claim about defective premises and its immediate obligation to comply with the rent covenant. The merits of the abatement claim remain for the District Court, but they did not justify shifting the costs of this separate Supreme Court proceeding to the landlords.