A few things come to mind:
1. Whatever the Strata Act says may be interpreted differently by different NCAT Members:
2. How long did the noise go on for? How many days? How many hours in the day?
3. How long did you propose she pay $500pw?
4. The fact that she stopped paying rent but returned to paying rent only after she rcvd the NCAT notice, will on the balance of probabilities be seen by NCAT as her complying with the term of the lease. Did she pay up all her outstanding rent? I had a tenant who refused to pay one month rent and was told by NCAT that so long as he was not in rent arrears by the end of the lease the tenant is in compliance with the terms of the lease.
5. Understand that many tenants (and for that matter landlords and neighbours) are opportunistic. It costs her $49 in NSW to apply to NCAT. In her mind the NCAT process has a good payoff: possibly:
THE UPSIDE
#weeks of noise x $weekly rent (and maybe a small quantum of other costs), versus
THE DOWNSIDE
(capped at) $49
6. How much $ is she seeking from you at NCAT?