Tenant’s pool compensation cut from $5,000 to $2,850 on internal review (SACAT, 2026)

What happened

The landlords bought the house on 21 November 2025. They did not live in it and advertised it for rent almost immediately, appointing an agent to manage the tenancy for them. The tenancy began on 23 December 2025 for a fixed term of one year, at rent of $1,250 per week, with a bond of $7,500 paid. Before buying, the landlords had obtained a building inspection report, but that report said swimming pools and spas were not covered by it and strongly recommended that a pool expert be consulted to examine the pool, the pool equipment and the plumbing.

On 24 December 2025, the day after moving in, the tenant emailed the agent to say the pool needed cleaning. He emailed again on 28 December 2025 to say the water was low and cloudy. The landlords engaged Poolwerx, the company the previous owners had used, and it carried out a "gold service" on 12 January 2026. A routine inspection on 9 February 2026 recorded that the pool was still not clean. On 24 February 2026 a Poolwerx employee told the agent that the company had already told the previous owner the pool filter needed replacing. That was the first time the landlords knew the pool equipment might need replacing.

A new filter went in on 3 March 2026. The solar control was replaced on 13 March, the chlorinator on 16 April and a new solar system on 22 April 2026. Poolwerx attended seven times between January and late April. After all the equipment was replaced there were no further problems with the pool.

The tenant applied to SACAT for compensation. On 29 May 2026 the Tribunal found the landlords had breached section 68 of the Residential Tenancies Act 1995 (SA) and ordered them to pay $5,000. That hearing went ahead without the landlords because their agents chose not to take part after being told the matter would not be adjourned. The landlords then applied for internal review, which is a fresh look at the decision by a more senior member of the same tribunal. An earlier application by them to put the original order on hold had been refused.

What each side wanted

The landlords argued they were not in breach at the start of the tenancy because they did not know, and could not reasonably have been expected to know, about any problem with the pool equipment: the previous owner and the pool contractor had told them nothing, the pool had been serviced shortly before the tenancy, their building inspection had not flagged it, and the pool looked immaculate. They said that once they learned of the filter problem on 24 February they acted almost immediately, that it was hard to get a pool contractor over the Christmas period, that the chlorinator did not really need replacing, and that the tenant was partly to blame because he could not manage the routine pool maintenance the tenancy agreement required of him and would not accept verbal instruction. They also said $5,000 was excessive and that the tenant's evidence about his losses had not been properly tested. The tenant relied on his emails from the first days of the tenancy, said the problems only stopped once all the equipment was replaced, and claimed the cost of extra chemicals and salt, the cost of a beach house holiday and a trip to Melbourne taken because the pool could not be used, compensation for losing the use of the pool itself, and compensation for the inconvenience of cancelled social plans, interrupted work to let contractors in, repeated dealings with the agent and time spent chasing the water chemistry.

What the tribunal decided

The Deputy President granted leave for the internal review to proceed and varied the original order. Order 1 of the order made on 29 May 2026 was deleted and replaced with: "The landlords must pay the sum of $2,850.00 to the tenant. This must be done by crediting the rent record forthwith." The Tribunal said that if the parties could not agree on how to put the order into effect, they could ask for a directions hearing.

The $2,850 was made up of $700 for inconvenience, $250 for additional chemicals and salt, and $1,900 for loss of use of the pool. The claim for holiday expenses was refused. The findings that the landlords had breached section 68 both at the start of and during the tenancy were upheld.

Why the tribunal decided it that way

Section 68 of the Residential Tenancies Act 1995 (SA) requires a landlord to have the premises in a reasonable state of repair when the tenancy starts. The test is an objective one: the question is whether a defect ought reasonably to have been apparent on an inspection at that point, whether or not the landlord actually inspected or knew about it. The Tribunal held the landlords could not rely on their building inspection report, because the report expressly excluded the pool and recommended a pool expert be engaged. As the landlords had only just bought the house and had little knowledge of it, they should have obtained expert advice about the pool equipment, and on the balance of probabilities that advice would have told them some of it needed replacing. The Tribunal disagreed with one part of the original decision: Poolwerx was engaged under a simple maintenance contract, not as a general agent, so what Poolwerx knew could not be treated as knowledge of the landlords.

After a tenancy starts, the standard is different. A landlord is liable for a later defect only if they know of it or ought to know of it, and then only if they fail to act with reasonable diligence to fix it. The Tribunal accepted it was hard to get a contractor over the Christmas and new year period, but said it should have been obvious early on that the problems were not resolving despite the "gold standard" clean and repeated attendances, and the landlords failed to investigate the underlying cause. The Tribunal also noted that under section 115 a landlord cannot contract out of their obligations, so the special pool-maintenance conditions in the tenancy agreement could not shift responsibility for repairing defective equipment onto the tenant, and that the landlords' expectations of the tenant were probably unrealistic given the landlord's own evidence that the equipment was the most complex he had encountered.

On compensation, section 110(1)(c) gives the Tribunal a discretion to award compensation for loss or inconvenience, there is no set formula, and section 110(2) excludes personal injury. Because the Act gives little guidance, ordinary contract principles apply, including causation. Applying the "but for" test, the Tribunal was not satisfied the beach house and Melbourne trips would have been avoided but for the pool problems, since the family could have gone to the beach or a public pool, so those costs were refused. Following the High Court's decision in Young v Chief Executive Officer (Housing), the Tribunal held that compensation can cover non-economic loss, that is, loss that is not simply money out of pocket. Part of the rent was attributable to having a pool, the landlords should have known the pool was a benefit of the agreement, and the tenant had paid for a benefit his family did not receive, so loss of use of the pool was compensable. Section 78 requires a tenant to take reasonable steps to reduce their loss, and the Tribunal found the tenant had not done so by declining verbal instruction on the complex equipment, which may have shortened the period the pool was unusable in late March and early April. The Tribunal also gave no weight to the landlord's own evidence about seeing the family use the pool, because he had attended the property under a different name as a maintenance person, which the Tribunal described as deceptive conduct. Because the compensation ordered was substantially excessive, the Tribunal found the exceptional circumstances that section 114A requires before leave for review of a payment order can be granted.

What this means if you are in a similar position

If you are in a similar position as a renter, this decision shows how SACAT separates two questions under section 68. At the start of a tenancy, the landlord is judged on what a reasonable inspection would have revealed, not on what they personally knew, and a building report that expressly leaves something out does not cover them for it. Once the tenancy has started, the test becomes whether they acted with reasonable diligence after they knew or should have known about the problem, and repeated call-outs that do not fix the underlying cause can themselves show a lack of diligence.

The decision also shows how compensation is worked out. It is not limited to receipts: the Tribunal accepted that losing the use of something you were paying rent for, in this case a pool, is a real loss even though no money changed hands for it. But every item still has to be connected to the breach. The holiday costs failed because the Tribunal was not satisfied they would have been avoided if the pool had worked. Compensation can also be reduced where the renter did not take reasonable steps to limit the loss, which is what happened here over the offer of instruction on the equipment. A written record of what was reported and when, as the emails from the first days of this tenancy were, is what the findings tended to rest on.

If you are in a similar position as a landlord, the decision is a reminder that an internal review of a payment order needs leave, and leave is only given in exceptional circumstances. Here that threshold was met because the amount was substantially wrong, but the findings of breach still stood. In disputes of this kind, most people start with a written notice or demand that sets out the problem, the breach and the amount they say they are owed, and only apply to the tribunal if that does not resolve it.

How to apply: our step-by-step guide to a SACAT application. More decisions: SACAT cases and house rentals and bonds.

Source: Simasiku & Anor v Ellis [2026] SACAT 91 (read the full decision). This summary was prepared from the published decision for general information. It is not legal advice, and the tribunal’s own reasons are the authoritative record.