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Landlords rely on their agent to advise them of the correct procedures and unfortunately a lot of PM's won't like to say 'no, that's not the right way to do it' to a client, even if it is in their best interest. Regardless of the case, it was the PM who has failed in the duty to you and it is...

I would be making a claim against the previous agent for your loss, make sure you have photos of damage by the previous tenant and receipts for all of your expenses relating to getting the property back up to scratch. Contact Fair trading in your state for some advice on how to take action.