We've been struggling for just over a year to get the builder (who has engaged over the past year - and is trying to resolve the property defect) to resolve the building defect in a timely manner. There is a water leak from the top floor of our unit to the lounge (ground floor). The tenant is now claiming that they have lost furniture and damaged loose carpet due to the rains and for their inconvenience due to the leak. We've tried our insurance to assist with this claim (lump sum claim) that the tenant is claiming from us as landlords without any luck. They say the tenant should have their contents insurance. They are unfortunately refugees (which the property manager 'sold to us' as a 'guaranteed rental income' as it is paid by Centrelink) and does not have contents insurance. They are now also beyond their initial 12 month contract and wants to stay on, but with reduced rent of $90 /week. They declined our earlier offer we made. In their original contract they signed for the initial 12 months, we've had a clause added to it to advise them that there is a building defect and that the builder is trying to resolve the problem. Questions: Are they in a position to claim the compensation and reduction in rent? Question: Is the best to let them take us to VCAT or us them to VCAT so that the court decide this? Question: Anyone out there experienced similar situation? Question: Help! What are we to do?