Noise Nazi Neighbours

I’ve been reading this forum for a while, but an incident last night has finally brought me to the posting deep-end..!

First, some background: we are four people living in a three bedroom GF apartment (two singles, one couple) in renovated late 70s block on Canberra’s south side. There are three apartments above us, all with balconies, though ours is the biggest. The block isn’t the silentest of places, with not very great soundproofing all around, and the ambient noise is fairly high as it’s across the road from a pub and a football club. Taking all that into account, it’s a nice safe area, and we four mid- to late-20s professionals very much enjoy it. I came here in February.

Back in April, on probably the last evening that it was warm enough to enjoy our balcony for any length of time, we had a birthday BBQ on a Thursday afternoon, with us four joined by two friends. As BBQs do this carried on into the evening. A round of Singstar was aborted at 9pm when the upstairs neighbour (who had moved in after purchasing about two months prior) poked his head over the balcony and asked us to keep it down. Dutifully we turned the game off, and we resumed sitting outside on the balcony, talking, with soft music playing from an indoor iPod dock. At 9:30 he pokes his head out again, asking us to keep it down, as he has to get up at 5am. Well, again, we thought this was fair enough and turned the music off completely; two people went home, so it was just the four residents sitting outside with drinks, talking. Not laughing, or yelling, or screaming, just talking about our respective days at work. Half an hour later, 10pm, he leans over again, screams at us to shut up, and that as he was an owner-occupier he had the right to tell us to be quiet as we were ‘just renters’. While the urge to tell him to PO was high, we obeyed and called it a night. We received an email from the agent the next day regarding a noise complaint, but hadn’t heard from them since.

It being rather chilly in Canberra in winter we haven’t socialised at all outside until last night, where the four of us cracked open a few bottles of red with a friend at about 9:30, after returning from dinner, to celebrate the engagement of the couple; we were mostly inside, but two of them ducked outside to talk while they had a cigarette occasionally. Eventually we drifted to bed (myself included) except for one half of the couple and their friend, who stayed outside to smoke and catch up (meanwhile, normal Thursday-night rowdiness going on at the pub across the road). Sometime between 10:30 and 11pm, Upstairs Neighbour stuck his head over the balcony, swore at them to shut up or he’d call the cops – who turned up not five minutes later, saying they’d received reports of a noisy and VIOLENT party going on at our flat! Obviously not being the case, the cops left.

This morning we found this note left under the door: https://img.ly/lyyg

Suggestions? Commiserations? What even the heck?