Improving the Quality of Residential Tenancy Databases

The Victorian Law Reform Commission's report on Residential Tenancy Databases (The Age, 6/4/05) concedes that these "blacklists" have an important role to play in reducing risks (and hence prices) in the private rental market. However, they are operated for the short-run benefit of landlords and real estate agents and so tend to accrue "false positives" ie erroneously listing good tenants. This is of concern to the entire community, as these wrongly-excluded tenants will end up taking up space in our public housing system - or face homelessness.

Given the present ineffectiveness of the National Privacy Principle's Data Quality provisions, the VLRC's position is that the Victorian Civil and Administrative Tribunal (VCAT) should take on the role of regulating these lists, approving each addition or modification to the private databases. This is unwieldy, costly and will simply drive underground dodgy practices.

As these private operators are trading in informational goods, a second (unexamined) option is to enforce "merchantable quality" under Section 74D of the Trade Practices Act. While "quality" is subject to judicial interpretation, the law states that if you paid for goods "not fit for purpose", you are entitled to seek redress. Why can't this apply equally to databases?