What was Tenancy Tribunal case 4303820 about?

The tribunal order states: The Tribunal orders name suppression to apply in relation to all tenants at

How much money was awarded in case 4303820?

Individual award amounts are in the official MoJ PDF. Claim amounts appear on this page when claims and net totals reconcile.

What type of tenancy dispute was case 4303820?

The primary dispute was Exemplary damages.

Where can I read the official tribunal order for case 4303820?

The official Ministry of Justice published order is available at https://forms.justice.govt.nz/search/Documents/TTV2/PDF/10020524-Tribunal_Order_Redacted.pdf.

What was Tenancy Tribunal case 4303820 about?

The tribunal order states: The Tribunal orders name suppression to apply in relation to all tenants at

How much money was awarded in case 4303820?

Individual award amounts are in the official MoJ PDF. Claim amounts appear on this page when claims and net totals reconcile.

What type of tenancy dispute was case 4303820?

The primary dispute was Exemplary damages.

Where can I read the official tribunal order for case 4303820?

The official Ministry of Justice published order is available at https://forms.justice.govt.nz/search/Documents/TTV2/PDF/10020524-Tribunal_Order_Redacted.pdf.

107 Blockhouse Bay Road, Avondale, Auckland 1026 Tenancy Tribunal Case 4303820 — Exemplary damages

Order

The Tribunal orders name suppression to apply in relation to all tenants at these premises (whether the tenants are applicants in this proceeding or not), and any information that may identify those individuals.
Shirley Anne Sharp to pay the Chief Executive, Ministry of Business, Innovation and Employment the sum of $69,563.10, calculated as follows:
Application 4303654 – [Tenant 1] Refund of bond$190.00 Exemplary damages s 19 (bond)$750.00 Exemplary damages s 66I (landlord obligations)$3,000.00 Exemplary damages s 123A (provision of documents)$750.00 Exemplary damages s 137(2) (prohibited transactions)$500.00 Rent refund (unlawful premises)$2,320.47 TOTAL$7,510.47 2
Application 4303795 – [Tenant 2] Exemplary damages s 66I (landlord obligations)$3,000.00 Exemplary damages s 123A (provision of documents)$750.00 Exemplary damages s 137(2) (prohibited transactions)$500.00 Rent refund (unlawful premises)$15,958.53 TOTAL$20,208.53
Application 4303799 – [Tenant 3] Refund of bond$380.00 Exemplary damages s 19 (bond)$750.00 Exemplary damages s 66I (landlord obligations)$3,000.00 Exemplary damages s 123A (provision of documents)$750.00 Exemplary damages s 137(2) (prohibited transactions)$500.00 Rent refund (unlawful premises)$8,296.70 TOTAL$13,676.70
Application 4303820 – [Tenant 3] Exemplary damages s 66I (landlord obligations)$3,000.00 Exemplary damages s 123A (provision of documents)$750.00 Exemplary damages s 137(2) (prohibited transactions)$500.00 Rent refund (unlawful premises)$23,917.40 TOTAL$28,167.40
The Tribunal restrains the Landlord from committing breaches of the following obligations for a period of 3 years: a. Failure to lodge bonds (s 19(1)(b)). b. Failure to provide premises that are reasonably clean (s 66I(1)(a)). c. Failure to provide premises in a reasonable state of repair (s 66 I(1)(b). 3 d. Failure to provide smoke alarms (s 66I(a)(ba)). e. Failure to insulate premises (s 66I(1)(bb). f. Failure to provide lawful premises (s 66(1)(c)). g. Failure to provide documents to Chief Executive (s 123A(4)).
All other applications are dismissed.

TABLE OF CONTENTS3 SUMMARY4 REASONS5 BACKGROUND6 Previous application and District Court decision7 PROCEDURAL HISTORY11 EVIDENCE GIVEN AT HEARING12 [Tenant 1]’s evidence12 [Tenant 2]’s evidence14 [Compliance investigator]’s evidence17 Mr Schmidt’s evidence18 Ms Sharp’s evidence20 RELEVANT LEGAL CONSIDERATIONS25 ANALYSIS27 FAILURE TO PROVIDE A TEANCY AGREEMENT WITH AN INSULATION STATEMENT – SECTION 13A27 FAILURE TO LODGE BONDS – SECTION 19 AND 66D27 FAILURE TO MEET LANDLORD’S ONGOING OBLIGATIONS – SECTION 66I 31 FAILURE TO ENSURE THAT THE FACILITIES OF THE PREMISES WERE IN A REASONABLE STATE OF CLEANLINESS – SECTION 66I(1)(A)31 FAILURE TO ENSURE THAT THE FACILITIES OF THE PREMISES ARE IN A RESONABLE STATE OF REPAIR – SECTION 66I(1)(B)33 a. No light in the kitchen.38 b. Broken and boarded up windows.38 c. Holes in walls and floors.38

4 d. Rotting weatherboards.40 e. Inoperative bathroom.40 f. Rotten deck.41 g. Missing gutters.43 h. Extensive moisture ingress.44 i. Heater and oven disconnected.44 j. Electrical fittings hanging from wall.45 k. Missing window latches.47 l. Missing toilet / bathroom door.48 m. Laundry appliances not working.48 n. External shower not having working hot water.48 FAILURE TO COMPLY WITH ALL REQUIREMENTS IN RESPECT OF SMOKE ALARMS – SECTION 138A AND SECTION 66I(1)(BA)48 FAILURE TO COMPLY WITH THE LANDLORDS INSULATION OBLIGATIONS50 FAILURE TO COMPLY WITH ALL REQUIREMENTS IN RESPECT TO BUILDINGS, HEALTH AND SAFETY – SECTION 66I(1)(C)51 a. Heating52 c. Property breached section 9(3) of the RMA and Auckland Unitary Plan53 Overall discussion of section 66I breaches54 FAILURE TO PROVIDE DOCUMENTS – SECTION 123A55 UNLAWFUL RESIDENTIAL PREMISES / PROHIBITED TRANSACTION57 RESTRAINING ORDER61

SUMMARY

The Ministry of Business, Innovation and Employment have filed four separate applications against Ms Sharp, the landlord of a boarding house in Auckland. The tenants in these premises are particularly vulnerable. The premise has now been demolished, but while it was operating as a boarding house, at least in recent years, it has become rundown, decrepit and unsafe. The Tribunal has determined that bonds were not lodged with the Bond Centre, and the landlord has breached multiple obligations to these tenants, such as failing to maintain the premises, and in relation to the provision of smoke alarms and insulation. Because of an absence of the necessary consents for the complex, the premises were operating unlawfully. The Tribunal has made significant orders against the landlord, and in the circumstances of this case determined that a restraining order is required, to prohibit future breaches from occurring should the landlord operate another boarding house. 5

Reasons

The Tribunal must consider applications filed by the Chief Executive of the Ministry of Business, Innovation and Employment (MBIE) on behalf of four boarding house tenants. The respondent in this case is the boarding house landlord, Shirley Anne Sharp.
The four particular tenants are: a. [Tenant 1] – tenancy commencing 3 December 2019, ending on 15 September 2020 1 (4303654) b. [Tenant 2] – tenancy commencing 4 April 2011, ending on 9 September 2020 (4303795) c. [Tenant 3] – tenancy commencing 29 November 2017, ending on 12 September 2020 (4303799); and d. [Tenant 4] – tenancy commencing 26 January 2011, ending on 12 September 2020 (4303820)
These applications were filed on 27 May 2021, and have been managed and heard by the Tribunal concurrently, but given the nature of boarding house tenancies, they are all separate tenancies, so strictly are separate claims.
In summary, the Applicant seek exemplary damages under section 109 for unlawful acts for the following breaches (with some variation between the four applications): a. Failure to provide insulation statements (s 13A(1A)). b. Failure to lodge bonds (s 19(1)(b)). c. Failure to provide premises that are reasonably clean (s 66I(1)(a)). d. Failure to provide premises in a reasonable state of repair (s 66 I(1)(b). e. Failure to provide smoke alarms (s 66I(a)(ba)). f. Failure to insulate premises (s 66I(1)(bb). g. Failure to provide lawful premises (s 66(1)(c)). h. Failure to provide documents to Chief Executive (s 123A(4)).
The Applicant also seeks orders for the landlord entering into a prohibited transaction and the premises being unlawful residential premises, including a refund of a portion of rent paid by the tenants. 1 The tenancy commencement and end dates are as stated on the Chief Executives application form commencing these proceedings. 6

BACKGROUND

The premises in question were a boarding house located at 107 Blockhouse Bay Road, Avondale, Auckland. It is not entirely clear when the boarding house operation commenced, but it may well have been in the 1980’s or 90’s.
I understand there are a total of 12 rooms in the boarding house, six inside the main house, and 6 in external ‘cabins’. In the course of the hearing the landlord has accepted that there would be up to 10 boarders in the premises at any time, but she disputes there would be more than that number. The Applicant’s position is that there were 11 tenants.
The house was originally a standard dwelling house that was converted to a boarding house use. The cabins are standalone structures on the wider tenancy site. None of these cabins were built with a building or resource consent. It is also relevant to note the cabins straddle the land owned by Kiwi Rail, which is licensed to the owners, but that licence is only for ‘beautification’ purposes, not the purpose of building dwelling units on. The licence expressly states the “Licensee shall not erect any building or structure on the Land without the written consent of ONTRACK”
Historically the premises were owned and operated by the Respondent’s mother, and later by trustees.
Following the death of the Respondent’s mother, the Respondent (Shirley Anne Sharp) took over operation of the premises. It is also the case that following Mrs Sharp’s death, the property was at some point sold and purchased by Fiona Tugaga, Ms Sharp’s sister in law. But nevertheless following that sale it was Shirley Anne Sharp (who I will now refer to in this decision as Ms Sharp) who continued the day-to-day management of the premises.
On 9 June 2020 a complaint was filed with the Ministry of Business, Innovation and Employment, Tenancy Compliance Investigation Team (TCIT). The complaint was on the basis of the premises being poorly maintained, and having unconsented cabins and a garage used for accommodation purposes. The landlord was said to be Shirley Anne Sharp.
I note at this time that in the RTA the responsibility for undertaking investigations around the compliance with RTA requirements, sits with the Chief Executive of the Ministry of Business, Innovation and Employment. However the officers within the TCIT act on delegated authority of the Chief Executive. For brevity in this decision I will refer to TCIT meaning not only the officers of TCIT, but Chief Executive where appropriate. 7
After obtaining information from the Auckland City Council, the TCIT investigator undertook a site visit on 4 August 2020. The landlord was not advised that this visit was to occur 2 .
A Dangerous and Insanitary Building Notice (DIBN) was issued by the Auckland City Council on 2 September 2020, and that required that all occupants of the boarding house vacate the premises by 12 September 2020. The notice was issued to both Presland & Co Trustee Company Limited (from here referred to as “Presland”) and Fiona Tugaga (the Trustees). The notice records that an investigation concluded that 11 people were boarding in the dwelling, and that “the buildings on site have not been upgraded for this use and that the buildings are leaking”. The notice required that all structures be vacated by 12 September 2020.
That same day the Council issued an abatement notice in relation to unauthorised buildings on the site (the exterior cabins and laundry / shower).
The landlord complied with the DIBN to the extent that the tenancies were terminated, and the tenants moved out. The landlord subsequently shut the boarding house down, and it has since been demolished.
I understand that the owners (Ms Tugaga and Presland) have not challenged the DIBN or abatement notices with the Council.
TCIT filed these applications with the Tribunal on 27 May 2021. Previous application and District Court decision
A relevant dispute in relation to this boarding house has previously been before the Tribunal, and was the subject of an appeal and decision in the District Court. I note that this was not raised by Mr Murray or Ms Sharp, and only came to the Tribunal’s attention co-incidentally via the registrar on one of the later hearing days, when Ms Sharp was concluding her evidence. Mr Gray was unaware of this earlier proceeding.
The District Court decision is Presland and Co. Trustee Company Limited and Fiona Tugaga v [Appellant - redacted] [2022] NZDC 21087. I note that Mr Murray appeared for the Appellants in that case, and Ms Sharp also gave extensive evidence.
The appeal was of a decision issued by the Tenancy Tribunal which ordered the landlord to pay $21,214.36 to [Appellant - redacted] for the following breaches: a. Compensation for a breach of section 66I ($3,000.00) 2 This was raised as a preliminary matter by the applicant. The Tribunal issued a decision confirming that there was no legal obligation on TCIT to notify the landlord of inspections, and the Tribunal accepts there are compelling reasons why TCIT may not wish to notify a landlord of an inspection in advance. 8 b. Exemplary damages for a breach of section 66I ($3,000.00) c. Compensation for unlawful premises ($14,040.00) d. Compensation for early termination of the tenancy ($1,153.92)
In the appeal decision, Judge D J Clark notes that there had been a preliminary issue raised as to who should be the landlord, with the Judge noting: Presland and Co. Trustee Company Limited has retired as a Trustee and therefore it was argued should not have been named as a landlord. Indeed, it was suggested Ms Sharp, who had a managerial role in managing the boarding house for the appellants should be named as landlord (and therefore appellant). The matter was initially pursued on appeal but during the hearing Mr Murray confirmed the matter was no longer being pursued. Accordingly, it is unnecessary for me to make any ruling on this matter and the appellants are as named in the intituing.
The Court therefore proceeded on the basis that the correct landlord of the boarding house was Presland and Co. Trustee Company Limited and Fiona Tugaga. Obviously that is not in concert with Ms Sharp now saying that she is the landlord.
Judge Clark summarised [Appellant - redacted]’s evidence, which I summarise as follows: a. [Appellant - redacted]’s tenancy commenced in 2015. b. The premises were in “a significant state of disrepair”. c. The units were cold and damp, and lacked insulation. d. There was no firewall between the units. e. Weatherboards were rotten and broken, there was no door on the ‘wash house’. f. The kitchen was in “a significant state of disrepair with nothing being cleaned for a significant period. Only one element worked on the oven...” g. He would request Ms Sharp to undertake maintenance, but no work would be forthcoming.
I note that [Appellant - redacted]’s complaints very closely mirror those that are currently before me, and that is relevant given the TCIT were not aware of [Appellant - redacted]’s complaints or claim, so the similarity in complaint lends weight to the accuracy of what these four tenants are complaining about
Judge Clark summarised the Landlords evidence as follows: 9 a. It was accepted the premises were to use the landlords word, “tired”. b. It was disputed the premises were not maintained, and that on the photographs provided to the court, the appellant stated the damage was from vandalism. c. In relation to the door being removed from the ‘washhouse’ that was “ripped off its hinges through the act of vandalism” d. “The appellants also maintain they were responsive to any requests to fix items and disputed the premises were as bad as alleged by [Appellant - redacted]” e. The premises had been sold in 2020 (the decision does not record who to), and that “...they had reached a decision to sell the property. This contributed to some of the maintenance obligations falling off toward the end of their ownership of the property”.
Judge Clark recorded that there were two broad grounds of appeal: a. The premises were not in a state of disrepair as the Tribunal had found to have been the case; and b. The premises were not unlawful residential premises as the Tribunal had also found.
The Judge concluded that the premises were dilapidated and in a total state of disrepair. [63] I agree with the Adjudicator’s assessment the premises were dilapidated and could not be described as anything other than being in a total state of disrepair. The Adjudicator was entitled to rely on photographic evidence to make this assessment. Having the benefit of seeing the photographs myself, I can understand why the Adjudicator reached the conclusions she did. [64] Notwithstanding there was a conflict of evidence between the parties over the state of the premises, it is clear the photographic evidence shows facilities which are unacceptable for any landlord to offer as a residence for tenants. Supporting the photographic evidence is also the independent written comments made by representatives of Tenancy Services, and Council Officers in the Abatement Notices and the DIBN. They also described the premises as dilapidated and unacceptable for residential dwelling purposes. 10 [65] The Adjudicator rejected the condition of the premises was as result of vandalism. I also reject that submission. The premises are dilapidated because they have not been maintained, not became someone has taken to them with an axe. The Adjudicator was right to observe the dilapidated condition occurred over a significant period prior to the notices issuing. [66]I also agree that on the evidence, the Adjudicator was entitled to find no firewall existed between [Appellant - redacted]’s units and the adjoining unit. Ms Sharp's evidence could not recall whether there was one. [Appellant - redacted] confirmed there was not one. Given the state of the premises including rotten weatherboards and planks I agree it was most unlikely a firewall existed. [67] The refusal and / or failure to maintain the premises when the statutory and regulatory obligations required the appellants to do so, was a flagrant and deliberate breach of the appellants obligations. Accordingly the Adjudicator had every right to reach the findings she did under s66I(1)(a) to (c) and I do not disturb those findings. ... [69] Furthermore, I also agree the neglect of the premises and failure to undertake maintenance was deliberate and intentional....
In relation to the question of whether the premises were unlawful residential premises, the Court accepted that there was no breach in relation to a 2008 Resource Consent, because it was not clear if that consent had ever been exercised.
However the Court considered that the boarding house was unlawful, because it required a resource consent for its operation, and because it did not have one, that made it unlawful: [75] Mr Murray maintained that at no stage, based on the evidence, were there more than 10 persons in occupancy. However, that evidence was counted by Tenancy Services who attended the property and who stated there were at least 11 people in occupancy when they visited... [76] I agree it was open for the Adjudicator to hold it was the overall capacity of the premises which dictated whether a resource consent was required, not the number of occupants which might fluctuate from time to time. H.6.4.1(A)(10) and H.6.4.1(A)(11) describe premises which can “accommodate” more or less than 10 persons. I take this to mean if the premises can “accommodate” more than 10 it needed a resource consent. It is common ground these premises could accommodate more than 10 persons and therefore needed a resource consent. Because it did not have a resource consent the premises were unlawful and in breach of section 78A of the RTA. 11 [77] I also agree with the Adjudicator the units which were located over the boundary breached the provisions of the Unitary Plan (H6.6.9) in that the units needed to be at least one metre from the boundary... [79] It follows then that whilst the license may have granted the appellants the right to occupy the KiwRail land, that right does not overcome the obligation to comply with H6.6.9 of the Unitary Plan. The failure to comply meant those units which occupied KiwiRail property (which included [Appellant - redacted]’s) were unlawful premises.
At appeal it was argued that if there was to be any finding that the premises were unlawful residential premises, it would only be after the DIBN and Abatement Notice was issued. The Judge rejected that argument: The DIBN and Abatement Notices were served because of the state of the premises. It was this state which made them unlawful premises because they breached s 66I(1). The notices merely confirmed they were unlawful premises. [Appellant - redacted]’s evidence and the photographic evidence proved the premises were in this condition for a considerable time prior to the notices issuing. Accordingly, I also agree with the Adjudicators finding on this ground.

PROCEDURAL HISTORY

A case conference was first convened on 7 March 2022. In attendance was Ms Watson-Hughes representing the Applicant, and Mr Murray representing Ms Sharp. Mr Murray had raised three particular jurisdictional matters, and therefore a telephone hearing was convened on 11 April 2022 to hear from the parties on those matters.
A decision in relation to those jurisdictional matters was issued dated 12 August 2023, and confirmed: a. The applications for exemplary damages were mostly in time as they related to continuing acts (alleged breaches), but that would not likely be the situation for a failure to provide an insulation statement, which was an act that occurred at the start of the tenancy, and such a claim would therefore be out of time. b. The inspection undertaken by the investigators was not an unlawful inspection, so there would be no basis to exclude the evidence they obtained from that inspection. c. The approach taken by the District Court in Gardiner v Upland Bay Investments Limited applied, and that if there were multiple breaches of a particular provision, there could only be one order of exemplary 12 damages to cover all breaches. But given there are four separate tenancies, an order of exemplary damage can be made for each tenancy. d. Confirmed there was a right of appeal or rehearing in relation to that jurisdictional decision.
There was no rehearing or appeal filed in relation to that decision.
A hearing was then scheduled for 28 and 29 November 2022 in [Event location suppressed]. At those hearings the Tribunal heard from various witnesses. As noted above, on what was to be the last day of that hearing, a District Court decision came to light (the [Appellant - redacted] appeal decision), and from that the issue arose as to whether Ms Sharp was in fact the landlord and correct respondent? Submissions needed to be provided on that matter, following which the Tribunal issued a further a decision on 4 April 2023, confirming that Ms Sharp was the correct respondent. As noted in that decision, Ms Sharp agreed she was the landlord, and grantor of the tenancies. Again that carried a further right of rehearing and appeal that was not exercised.
The final hearing day was on 20 September 2023 where I heard submissions from the representatives. I note the representatives had filed helpful and comprehensives written submissions in advance which I am grateful for.

EVIDENCE GIVEN AT HEARING

[Tenant 1]’s evidence

[Tenant 1], a tenant at the premises, attended the hearing where he gave evidence from a written brief. I summarise that evidence as follows: a. [Tenant 1] moved into the premises most recently on 3 December 2019. [Tenant 1] had lived in the premises prior, and moved back in when he had nowhere else to live. b. No written tenancy agreement was provided. c. A bond was paid but he understands not lodged with the Bond Centre. d. The premises were not in a reasonable state in that: i. The electric oven did not work for “years”, since first moving into the premises in 2016. ii. Only two of the four gas elements worked. iii. There was a broken internal window in the kitchen which was boarded up. [Tenant 1] cannot recall the window in any other state than boarded up. 13 iv. Similar there is an external window in the kitchen that had been boarded up for ‘years’. v. A hand-basin in the bathroom outside the lounge and bathroom had broken taps, but [Tenant 1] confirmed there was a second handbasin in the bathroom close by. vi. There were holes in the lounge and kitchen floors that had other boards nailed over the top of existing flooring. vii.The back deck was rotten and dangerous. viii.The guttering did not work properly. ix. The shower was cold, not freezing but off cold. While coin operated, the coin operated device did not work. x. The washing machine and dryers did not work. xi. There was a toilet in the laundry. It did not have door, and there was a curtain for privacy which was not effective if windy. xii.Outside the kitchen window was a mattress and base having been there for some months. e. [Tenant 1] could not use a heater in his room as advised by Ms Sharp. f. There was no smoke alarm in his room or within 3 metres of the bedroom. g. The landlord would turn up unannounced, but when problems with the room were raised, the landlord did not do anything about those problems. h. [Tenant 1] moved out on 15 September 2021 after the Auckland City Council deemed the premises unsafe.
Following further questions from Ms Watson-Hughes, [Tenant 1] confirmed that his unit was not the converted garage, but it was an “L-Shaped box”.
[Tenant 1] states that a door from the premises had been placed over the holes on the deck.
[Tenant 1] believes there were 12 rooms on the premises, 5 of those rooms being in the main house. [Tenant 1] described some of the rooms as ‘makeshift’, and unmaintained for many years.
Under cross examination [Tenant 1] advised that: a. He moved out and later moved back into the same room, which had been repainted and recarpeted. [Tenant 1] advised the room was freezing, and he does not consider the premises were insulated, but he considered the premises were dry. b. [Tenant 1] maintained that he did not receive a tenancy agreement or insulation statement, advising that any agreement was verbal. c. [Tenant 1] disputes that the bond was only for one week of rent. 14 d. The ‘rotten’ deck would be used in order to gain access to the kitchen and laundry / toilet room. e. [Tenant 1] was not aware that the door had been removed so tenants would not use the toilet facilities in the laundry, and further he was not aware who put up the curtain (which Mr Murray advised was another tenant). f. In relation to the heater in the lounge, [Tenant 1] advised he was told the heater did not work, but he had otherwise not tried to use the heater himself. g. [Tenant 1] disputes that there were smoke alarms in his cabin and states he did not take the smoke alarm down. h. Some of the lights did not work, but [Tenant 1] advised he was not sure why that was so. i. In retrospect, [Tenant 1] advised the first time he stayed in the premises he enjoyed his time there. After he moved out, he subsequently went back to the premises when he had family disputes.
Mr Murray asked questions to the effect that if things were so bad for [Tenant 1] at the premises, why he tolerated it. [Tenant 1] advised he has little in the way of needs, and believes he is more tolerant than a person in average.
I record that I found [Tenant 1] to be a reliable witness. [Tenant 1] readily clarified matters when asked, and if there were matters he was not sure of, he readily said so. [Tenant 2]’s evidence
[Tenant 2] attended the hearing on 28 November 2022 where he gave oral evidence. [Tenant 2] confirmed that the statement provided in advance was his. I summarise [Tenant 2]’s evidence as follows: a. [Tenant 2] lived in room 5 in the house for some 8 years, and then he moved into the ‘shed’ for another 2 years. [Tenant 2] described the shed as a “hole” but comfortable. The shed was mouldy, but he got rid of the mould by cleaning it. The shed was described as cold, meaning [Tenant 2] would need to wear a jersey at night in bed to keep warm. b. [Tenant 2] believes that Ms Sharp was running the premises. A tenancy agreement was entered into at the start of the tenancy. Mr Gray produced a copy of a boarding house tenancy agreement, and asked [Tenant 2] if this was the agreement he received, [Tenant 2] thought it was, but did not seem sure on that point. c. Ms Sharp would visit the premises around weekly. 15 d. [Tenant 2] addressed the photographs on the file, noting: i. The inside handbasin for the toilet had a broken tap that did not work. ii. The light bulb was missing in the kitchen. iii. It was not known if the woodburner in the lounge worked. iv. The holes in the wall were present over the course of the tenancy. v. [Tenant 2] estimated there would be 5 people living in the house, and 6 outside (11 in total). vi. A glass panel in an internal door was broken for a “few years”. vii.A wall heater was on the wall in the lounge, which did not work (a green lounge chair was up against the heater). viii.There was a patch to the floor, presumably over a hole, that had been there “as long as I can remember”. ix. The shower provided hot water. x. In the kitchen the gas elements worked, but not the oven which was taped closed. There was a fridge and hot and cold water. The window in the kitchen was boarded up for some “years”. xi. The outside shower did not have hot water. There was door to the outside toilet, and at some stage a tenant put up sheet up for privacy which at some stage “grew legs”. xii.The deck was in poor condition and had “always been like that”. It is disputed that the landlord had put the outside deck out of bounds, noting that one could not use the laundry and outside toilet and shower without crossing the deck. e. There were no smoke alarms in the house, and [Tenant 2] disputes that he removed any such alarm, noting that he did not smoke so that would not be a reason why he would have removed the alarm. f. [Tenant 2] stopped complaining about the property, because nothing would ever be done. g. [Tenant 2] disputes any evidence from Ms Sharp that between tenants the rooms were recarpeted, repainted and repaired. [Tenant 2] states that whenever anyone moved into the rooms, they would take it on themselves to clean the room. h. [Tenant 2] disputes that the premises were maintained. i. It was disputed that Ms Sharp attended the house around 3 times each week. j. There were some things replaced in the tenancy, but it was “junk” they replaced it with.
Mr Murray cross examined [Tenant 2], and I summarise that as follows: 16 a. In relation to the cabin that [Tenant 2] moved into (from his room in the house), [Tenant 2] confirmed that after the prior tenant ([previous tenant]) moved out, there was new carpet, lino and some kitchen cabinetry installed (a bench with sink and running water). b. [Tenant 2] could not recall asking for security bars to the windows. c. [Tenant 2] confirmed that the investigators did go into his cabin, but he was not sure if photographs were taken. d. In relation to [Tenant 2]’s evidence about no work having been undertaken, [Tenant 2] confirmed that he was referring to when he was inside the house. e. [Tenant 2] confirmed he may have smoked inside his cabin, but he disputes taking any smoke alarms down. [Tenant 2] does not know of any other tenants removing the alarms. f. [Tenant 2] would do all his cooking in his room, using a portable gas cooker he purchased. g. Mr Murray asked if [Tenant 2] was aware that the deck had been taken to by a tenant with an axe? [Tenant 2] advised he was not aware of that, he considered it was simply rotten. h. On further consideration, [Tenant 2] confirmed that he could recall being told not to use the deck. i. [Tenant 2] disputes that the door to the toilet was removed to avoid people using the outside toilet, advising it was removed because it was rotten and had been like it was for some time. j. It was disputed that windows were broken regularly by boarders and guests. [Tenant 2] states he can only recall that one window in the house may have been repaired, but generally when windows are broken they are not repaired. k. [Tenant 2] confirmed that he had not tried to turn the heater in the lounge on, but given no other tenant would use it, he presumed it not to be working. l. [Tenant 2] believes the hole in the lounge wall was there as long has he had been in the premises. m. Mr Murray advised that Ms Sharps evidence is that the sink in the bathroom in the house was disconnected because tenants would leave it running which would then flood the house. [Tenant 2] advised he did not know about any flooding issue. 17 n. There were 1 or 2 boarders that [Tenant 2] did not get on with, which made it difficult to a degree. o. [Tenant 2] disputes that he has been dishonest. p. [Tenant 2]’s bond was not returned.
In re-examination, [Tenant 2] advised that the tenants were told they were not allowed to have heaters in the house. [Tenant 2] confirmed there was a heater in the hallway that would be on in winter, but not the heater in the sitting room. [Compliance investigator]’s evidence
[Compliance investigator] is a Senior Compliance Investigator for the Auckland City Council, and also provided a statement in advance of the hearing, which [Compliance investigator] confirmed is his statement.
[Compliance investigator] confirmed that he undertook a site visit on 4 August 2020. From that assessment, [Compliance investigator] confirmed that he found a number of cabins on the site had been erected without consent.
It was assessed that there was insufficient fire separation based on a visual assessment. [Compliance investigator] gave the example of the plaster board being installed without the gaps between boards being plastered, and the access hatch into the ceiling being unsealed. The switches had not been upgraded.
Based on the Building Act requirements, the premises would require 2 showers, 3 toilets and 3 basins on the basis of there being 12 occupants at the premises. Reference was made to G1 of the Building Code.
The cladding for the building was in poor condition, with some waterproofing missing, which made the building insanitary due to the ingress of moisture.
[Compliance investigator] set out the work that would be needed in order to bring the premises up to an acceptable standard for a boarding house, particularly around fire cells in each room, increasing the number of bathrooms and undertaking work to the exterior of the premises.
When the premises were previously constructed, it was as a dwelling, but there has since been a change of use to a boarding house, which required a change or use consent. But if that was to occur, then it would be the rules that applied at the time of the conversion that applied.
Mr Murray asked if the change of use occurred prior to 1991, if no fire separation was needed at that time, would that be needed on 2020? [Compliance investigator] confirmed that fire separation would not be needed 18 now, because the rules that apply are the rules at the time of the change and application.
[Compliance investigator] confirmed that he was not able to confirm the precise number of people living in the premises.
[Compliance investigator] confirmed that at the time of the inspection some of the tenants were not pleased that the inspection was taking place, and seeing people of authority on the premises, but on the whole the inspection went well. [Compliance investigator] confirmed that none of the residents asked the inspectors to leave.
However, [Compliance investigator] confirmed that on a later date when the insanitary building notices were being posted, the tenants did not take that well, and one tenant assaulted [Compliance investigator] and the police were called. Mr Schmidt’s evidence
Mr Schmidt attended the hearing and also gave evidence. Mr Schmidt was an investigator for the MBIE Tenancy Compliance Investigation Team at the time of the inspection. Mr Schmidt confirmed his written statement provided in advance.
With reference to bonds, Mr Schmidt confirmed that he undertook a search of bonds for the premises using the address. From that only one bond could be located.
Mr Schmidt advised that he made an information request from MSD for bond payments, which confirmed a payment being made to the landlord in relation to [Tenant 1] and [Tenant 3].
On 19 April 2021 Mr Schmidt undertook a further search of bond records under the street number, and only the one 2015 bond could be found.
Mr Schmidt confirmed that Ms Sharp was invited to attend an interview but she declined to attend, and that it was otherwise “impossible” to get Ms Sharp to engage, although there was some communication with her.
On 4 August 2020 Mr Schmidt undertook an inspection of the premises. Mr Schmidt confirmed that he took the photographs provided and commented as follows: a. In the kitchen there was no light or smoke alarm, but mould on the ceiling. b. There was a general lack of maintenance, noting that the tap in the inside bathroom did not work. 19 c. The photograph of the lounge show a hole in the wall. d. Mould was visible on the wall in the living room. e. The door between the living room and hall to the inside bedrooms had a broken pane of glass. f. The heater in the lounge was advised as not working. g. There were two sinks in the bathroom area. One was in the shower room which was working, but if someone was using the shower they could not wash their hands. h. The hanging light in the kitchen was not wired. i. Kitchen windows did not close, the side latches were missing. j. Rubbish was stored outside with reference to what appears to be two double mattresses. k. The exterior toilet did not have a door, so anyone using the toilet would be visible from outside the premises. l. One tenant was living in a garage. m. There was no insulation under the house. Mr Schmidt could not get under the cabins because they were on blocks.
Mr Schmidt states that he was “shocked” at the standard of these premises, noting he has assessed around 60 boarding houses. On a scale of 1-10 (1 being very poor and 10 very good), Mr Schmidt considered these premises would rate a 1.
Mr Schmidt advised he calculated the number of people living in the premises by way of observation, and looking in windows.
The residents asked that no photographs be taken inside their rooms.
No smoke alarms could be seen in the premises, but Mr Schmidt recalls one tenant saying there was one in his room, but again there are no photographs of that.
Mr Schmidt confirmed that a range of documents were requested on 7 August 2020, and followed up on 8 October 2022. The records were not provided. Ms Sharp was then requested to attend a formal interview. Mr Schmidt confirmed that he had not received even copies of the tenancy agreement.
One tenant ([redacted]) advised he had been living in the premises for some 30 years, was around 70 years old and living in a concrete garage. 20
Under cross examination Mr Schmidt advised: a. Mr Schmidt cannot recall Ms Sharp advising that only one week of bond for [Tenant 1] was provided. b. Mr Schmidt confirmed that if only one week of rent was paid, then that did not need to be lodged with the Bond Centre. c. The Inspectors preference is not to advise the landlord of an intended inspection when invited in by tenants, because the notice may then result in pressure coming on from the landlord. The inspector wanted to do the evidence gathering free from the landlord’s intervention. d. Mr Schmidt did not check the ceiling for insulation, only underfloor. e. The term “land banking” was a term used by Ms Sharp.
Under re-examination, Mr Schmidt advised the landlord did not provide copies of receipts for any bonds Ms Sharp’s evidence
Ms Sharp provided a written statement, which she read at the hearing.
In her written statement Ms Sharp advised that the boarding house was originally operated by her mother on behalf of the ‘Kaukau Trust’, until her mother passed away in 2007, after which the estate operated the boarding house until 2013. However Ms Sharp accepted that she had signed a tenancy agreement in 2011, so accepts she must have been doing some work for the boarding house at that time.
The property was subsequently purchased by Fiona Tugaga (Ms Sharp’s sister in law) who purchased the property in 2013.
Ms Sharp states she was not aware that any of the structures on the premises were not consented, however it was acknowledged that there had been an undertaking to remove the cabins as part of the 2008 subdivision. Ms Sharp states that this was not raised during the sale of the property.
Ms Sharp advised there were between 4 to 10 boarders, but not more than 10. Rooms were kept available for emergency housing.
Each room was repainted, recarpeted and repaired after boarders moved out, and reference also made to changing curtains: 21 Each room was repainted, recarpeted and repaired after a boarder moved out. We would also often arrange for a jumbo bin to be delivered so that the boarders could clean out their rooms. This was done at no charge. All concerns and repairs were dealt with as quickly as possible after I was notified by a boarder.
Ms Sharp stated there was a variation to her statement that the premises were a boarding house from 1990, stating it was in fact a boarding house from at least 1983.
Ms Sharp advised that she attended the property daily most weeks, or at least three times a week.
It is disputed that the tenants were refused permission to use heaters in their rooms, and it is submitted the heater in the lounge worked.
The kitchen was not used extensively, because the tenants would generally prepare food in their rooms.
It was accepted that there were some broken windows in the house in August 2020, but Ms Sharp states that she would use [glazier], and pay them for the work they undertook. Ms Sharp states that they had regular electricians, glazier, plumber and locksmith.
The boarders were advised not to use the deck, and states that a notice was put up advising the parties of this. Given the situation with the deck, the landlord elected to remove the door of the outside toilet / shower so that that room would not be used.
In December 2019 the decision was made to remove the deck, but that was delayed because Ms Sharp had medical problems. Further delays arose because of backlog with tradespeople.
Ms Shape states she was not aware of the situation with underfloor insulation.
Ms Sharp states there were smoke alarms in all rooms, and if they were missing, they would have been taken down by the tenants.
As it relates to the documentation requested by the Investigator, Ms Sharp did not consider that providing the documentation needed to take precedence to supporting the tenants.
The records Ms Sharp held were destroyed in a flood, however some records were later found stored in a shed.
Ms Sharp disputes that the building is unsafe or insanitary.
As far as the Railway land is concerned, Ms Sharp understood that the land was properly leased for the purpose of using that for the cabins. 22
No steps were taken to challenge the Council notice, as Ms Sharp states she was not well enough to do it.
Ms Sharp states that all bonds were repaid at the end of the tenancy.
In relation to the photographs, Ms Sharp advised that: a. The damage to the lounge wall had been caused by tenants probably when hiding drugs. b. It is believed that the patch to the floor was the result of tenants hiding something under the floor. c. The door to the external toilet / laundry was removed in 2019.
In response to questions from the Adjudicator, Ms Sharp advised that in 2020 the property was owned by Ms Tugaga and Presland.
I asked Ms Sharp who she considered to be the landlord in this case? Ms Sharp confirmed it was her. I raised with Ms Sharp whether she was accepting that she was personally liable for any orders, and she confirmed that she accepted she was. 3
Ms Sharp stated that she was not paid for any work she did at the premises, it was on a voluntary basis only.
Ms Sharp advised the rooms are kept in very good order because that is where the tenants live, whereas they don’t spend much time in the rest of the house.
Under cross examination Ms Sharp confirmed that the main house was the house she lived in as a child as it was originally their family home.
Ms Sharp confirmed that she is neither a trustee of the trust, and neither is she a beneficiary, the beneficiary is a niece.
Ms Sharp disagreed that the premises were in “squalor”, stating that the tenants would cause considerable damage, but she accepted the tenants would not be responsible for defects with the structure of the premises.
In relation to rent payments, Ms Sharp accepted that the MSD records (an email from 8 January 2021) was most likely correct.
In relation to the tenancy agreement with [Tenant 2], Ms Sharp advised that she was operating on the instructions of [redacted]. 3 Ms Sharp also acknowledged liability at the start of the hearing on 29 November 2022. 23
The reference to cleaning the common facilities in the tenancy agreement, the landlord was meaning that the tenants needed to clean up after themselves, for example after using the kitchen.
Ms Sharp confirmed that she was not aware of the legal impediments that arose with the Railway land, stating that the arrangements had been made earlier by her brother and lawyer.
Mr Gray referred to the licence to occupy the railway land, and in particular clause 8, which only allowed the property to be used for beautification purposes. Ms Sharp again advised that she was not privy to the restrictions that applied to that licence.
Ms Sharp advised while there were restrictions with the COVID 19 lockdowns, she was aware of some problems with the premises prior to the first lockdown commencing.
As it relates to the outside toilet, Ms Sharp advised that the tenants could have accessed the main house to use the inside toilet. Ms Sharp advised that she removed the toilet door to stop the tenants using the outside toilet.
As it relates to the photographs, Ms Sharp stated: a. She agrees the oven was taped shut. However, Ms Sharp states the oven was wired in and working when it was installed. b. Ms Sharp was not aware that the windows did not have latches, and as far as the landlord is concerned the photographs from the inspectors do not show the latches are missing. c. The switch on the wall which is not properly secured was not live, it was the disconnected power supply for the oven. d. The sink in the inside bathroom had been disconnected by the plumber. While the concern was because of overflowing, that did not apply in the kitchen which was more visible. e. I asked the landlord how someone who used the inside toilet could have washed their hands if someone was in the shower. Ms Sharp advised they could have used the basin outside (the outside bathroom / laundry which the landlord states was out of bounds) or kitchen sink. f. Ms Sharp maintained that the heater in the lounge was working. Ms Sharp also noted there was a heater in the hall, and other heaters supplied for the individual rooms. g. As it relates to the broken door glass door inside the premises, Ms Sharp advised that special glass had been ordered (cathedral glass), and there were supply delays. 24 h. After the laundry was made out of bounds, the landlord states the expectation was that the launderette up the road be used. i. It was put to Ms Sharp that she had ‘given up’ maintaining the premises. Ms Sharp denied that was the case. j. It was put to Ms Sharp that by February 2020 the decision had been made to demolish and or sell the property. Ms Sharp advised that when she contacted the land agent at that time, it was only for an opinion on sale, but it was later when the issues with the council and TCIT arose that the decision was cemented for her. k. Reference was made to the record of Ms Sharp stating she was landbanking the property. Ms Sharp states she does not even know what that term means.
Mr Gray put it to Ms Sharp that the email from [redacted] had been altered, given the dates and changes of font. Ms Sharp denied the email was changed.
In relation to the letter from [Flooring company], it was accepted that cabin 8 was not one of the applicant’s cabins in this case. Ms Sharp advised that [flooring company] (in that letter) was asked to address the state of the deck.
Mr Gray referred to the schedule of repairs and maintenance between 2013 and 2020 which were very specific to two decimal places. Ms Sharp advised that she had gone over payments made, but accepted she had not produced the original bank records or accounts. Ms Sharp advised it did not include cash jobs. The totals stated were out of the trust accounts which Ms Tugaga gave Ms Sharp permission to access.
Ms Sharp advised she is the landlord, and some of the repairs had been reimbursed to her others were not.
Mr Gray asked why the documents requested were not provided to the TCIT investigator, given many have now been provided in the proceeding. Ms Sharp did not address this question.
Ms Sharp does not agree that the building is insanitary.
In relation to the bonds, no receipts were provided because the payments were less than one week in rent, and received by electronic banking. No bonds were lodged with the Bond Centre.
As it relates to the photographs presented to the Tribunal on the morning of the hearing on 29 November 2022, the landlord again stated that there were smoke alarms in [Tenant 2]’s room, but accepted these are not shown in the photographs. 25
In re-examination Ms Sharp advised that the bonds have been repaid.
Ms Sharp states the smoke alarm was above the door, and hence that area not shown on the photographs.
The alarm for [Tenant 1] was on the wall above [Tenant 1]’s bed.
I record that I had difficulty accepting some of the evidence provided by Ms Sharp, because it was not consistent with other evidence, particularly photographs, and at times appeared self-serving. I have approached her evidence with caution.
I have been unable to establish what Ms Sharp’s actual engagement with the premises was. Certainly Ms Sharp accepts that she is the landlord, but on her evidence she does this on an entirely voluntary basis. Ms Sharp’s evidence was that she attends the premises almost daily, and undertakes wide ranging duties for the operation of the boarding house, but for no reward. The tenants pay rent to live in the premises, it is not clear where that money then goes as far as Ms Sharp is concerned. There is also the fact that Ms Sharp has readily accepted liability for any orders made by the Tribunal, which would be very unusual in the tenancy context where someone was acting simply as an unpaid volunteer. There is also the fact of Ms Sharp giving evidence around the sale of the premises, or challenging the DIBN and abatement notices. Ms Sharp does not own the premises, neither is she a beneficiary of the Trust. The notices were not issued to Ms Sharp but the owners, so It is not clear on what basis Ms Sharp could challenge those notices.

RELEVANT LEGAL CONSIDERATIONS

Onus of proof

With any claim before the Tenancy Tribunal, the Tribunal applies the usual civil law standards and expectations. That means that it is for the party bringing the application to establish their claims “on the balance of probabilities”. That means that they must establish that what they are claiming is more likely than not. This is referred to as the “burden of proof”. Independent witnesses, corroborating documents and photographs are an important part of discharging this burden.
As noted by the District Court in Kaipo v Clarke & McCarthy (DC) TT233/02, in practical terms this means that: 26 ... [L]ike anyone who brings an application before a Tribunal or Court, it is incumbent upon the applicant to provide the evidence necessary to prove the case. If the applicant fails to do that, then their application will be dismissed whether it has merit or not because it is up to the applicant to provide the necessary evidence. It is not up to the other parties, and it is certainly not up to the Tribunal to extract evidence.
I do not need to be completely certain, but I need to be more certain than uncertain. In deciding any particular claim, I must consider all the evidence presented (including oral evidence during the hearing). I must weigh this evidence to decide what is more likely. Exemplary damages
The Applicant seeks exemplary damages on a number of grounds.
Exemplary damages are designed to punish and to deter. They are like a fine. In Auckland City Council v Blundell [1986] NZLR 732 the Court of Appeal (Cooke P) said: Exemplary and punitive [damages] are different words for the same thing. The damages are exemplary because they are meant to teach an example to the guilty officer and others. They are punitive because they are meant to punish. They are like a fine, though they go to the citizen who has been the victim of conduct.
Exemplary damages are awarded at the Tribunal’s discretion when one party has proved that the other party has committed a defined unlawful act. If that is proven, and before the Tribunal may award exemplary damages, it must take account of the factors set out in section 109 RTA.
Section 109 of the RTA relates to exemplary damages, and confirms that exemplary damages can be awarded if the unlawful act was committed intentionally, and having regard to: a. The intent of the person committing the unlawful act. b. The effect of the unlawful act. c. The interests of the landlord or tenant against whom the unlawful act was committed. d. The public interest; and e. Whether it is just to make the award.
The maximum levels of exemplary damages are set out in Schedule 1A of the Act. 27

ANALYSIS

Submissions from Messrs Gray and Murray were provided in writing in advance of the hearing on 20 September 2023, and summarised orally on the day. I will now proceed to consider each claim separately, setting out the submissions and the Tribunal’s analysis of the claim. FAILURE TO PROVIDE A TEANCY AGREEMENT WITH AN INSULATION STATEMENT – SECTION 13A
Mr Gray submitted that exemplary damages should be ordered for a breach on the part of the landlord, in not providing a written tenancy agreement with insulation statement, as required by section 13A(1A) and (1F), and section 66C(1).
Mr Gray submitted that [Tenant 1] was clear, including in cross examination, that he was not provided with a tenancy agreement nor insulation statement. No evidence has been presented to show that [Tenant 1] or [Tenant 3] have been provided with insulation statements at the commencement of the tenancy.
Mr Gray referred to the Tribunals order of 12 August 2022 (paragraphs 20 – 29) in which the Tribunal had indicated that this claim would be out of time, given the acts occurred prior to the changes in the RTA coming into force. Mr Gray submitted that this decision was not determinative and did not dispose of the claim for exemplary damages.
Mr Murray submitted that that the 12 August 2022 decision made a finding around which version of section 109 applied, and found that the version of the Act that applied was the version when the act occurred, and that finding is binding (it was not overturned on appeal), so this claim is out of time. Analysis
For the reasons set out in the decision from 12 August 2022, I find this claim is out of time. That 4 August 2022 decision carried a right of appeal should the Applicant have disagreed with it. But for the reasons as set out in that decision, this claim is out of time, so is dismissed. FAILURE TO LODGE BONDS – SECTION 19 AND 66D 28
Mr Gray submitted that the respondent failed to lodge the bond as required by the RTA in relation to the tenancies of [Tenant 1] and [Tenant 3], including orders that the bonds be refunded ($190.00 for [Tenant 1], and $380.00 for [Tenant 3]).
In relation to [Tenant 1], Mr Gray referred to evidence from MSD which confirmed the payment of $380.00 for bond on 3 December 2019. It was recognised that $190.00 was refunded at the end of the tenancy (15 September 2020), which would comprise part payment of the bond amount.
In relation to [Tenant 3], evidence from MSD was that $380.00 of bond was paid at the start of the tenancy on 29 November 2017, at the same time with the payment of $380.00 for two weeks of rent. There was no evidence of the rent being refunded.
It was submitted that the bonds for both tenancies were over 1 week of rent, so needed to be lodged with the Bond Centre.
Mr Gray noted that some tenancy agreements are no longer available, but referred to the tenancy agreement for [Tenant 2] which required two weeks of bond, but for other tenants only one week of rent was required for bond.
In the absence of the landlord producing records or receipts, it was submitted that the evidence of the tenants should be preferred.
The applicant seeks orders of the payment of exemplary damages, and the refund of the withheld bond.
In response Mr Murray submitted that this application should be dismissed.
Mr Murray submitted that Ms Sharp accepted that she did not lodge the bonds, but that was because it was only a payment of one week of bond, hence lodgment was not needed.
Mr Murray accepted there were missing tenancy agreements, but reference was made to another tenancy agreement for [Tenant 5], and that showed that the bond payment was for one week of rent, and that agreement was around the same time, so could be accepted as the agreement that was probably applied.
It was submitted that Ms Sharp does not accept that the MSD records were correct. That was put to Ms Sharp in cross examination, and it was submitted that her responses were not inconsistent, in that her evidence was that the payment of $380.00 was one week of bond, and one week in advance.
Further at the end of the tenancy, one week of bond was returned to [Tenant 1], which was his bond. 29
Mr Murray submitted that $190.00 was refunded to [Tenant 1] (as shown on his bank records), but otherwise [Tenant 1]’s own evidence was that he could not recall how much bond was owing. In relation to [Tenant 3], it was submitted there are no bank statements supporting [Tenant 3]’s claim.
Mr Murray confirmed that he was not pursuing any argument that this claim was filed out of time. Analysis
I must determine what the likely amount of bond was paid for [Tenant 1] and [Tenant 3]. After making that determination, I will need to consider whether the landlord has committed an unlawful act (for exemplary damages purposes) in not lodging the bond, and then whether any bond can be refunded.
The best evidence available to the Tribunal, is the contemporaneous documentary evidence from MSD. These were records taken at the time the tenancies commenced. Other relevant evidence would have been the tenancy agreements, as well as the financial records which the landlord was required by section 30 of the RTA to keep. Section 30 requires: 30 Landlord to keep records (1) Every landlord under a tenancy to which this Act applies shall keep or cause to be kept proper business records showing— (a) all payments of rent paid by or on behalf of the tenant, sufficient to enable the landlord to comply within a reasonable time with any request made by the tenant under section 29(3); and (b) any amount by way of bond paid by or on behalf of the tenant on or after 1 May 1996. (1A) The records must be kept for 7 tax years after the tax year to which they relate.
In this case Ms Sharp has claimed that the records were destroyed, and that was part of her defence to not providing them when required by the TCIT investigator, but that is not consistent with some records later being discovered and produced. Ms Sharp has not convinced me that the tenancy and bond records could not have been provided. The landlord would have been able produce other records to establish the bond situation, such as banking records which presumably could have been obtained from the bank.
What remains is that the only documentary evidence available is that from MSD, and in the circumstances I can see no reason why those records should not be determinative in showing that the initial payments were intended to be bond payments. In relation to those records: 30 a. I note a letter from [redacted] of MSD, dated 26 March 2021, recording that $380.00 of bond was paid on 29 November 2017 for [Tenant 3], and that same day $380.00 of rent in advance was also paid. b. An email from [redacted] of MSD, dated 8 January 2021, recording that a bond of $380.00 was paid to Ms Sharp for [Tenant 1].
I accept those recorded bond payments would comprise 2 weeks of rental. I accept therefore that for both tenants, more than one week of bond was paid, and that needed to be lodged with the Bond Centre (see section 66D).
The landlord’s position is that the bond was applied as one week of bond (which did not need to be lodged) and the first week of rent. There is no evidence of that, other than the landlord’s assertion that was the case. The question in section 19 is not how the landlord accounted for the bond, but how the tenant paid the bond (or MSD on behalf of the tenant), or to put that another way, what the tenant intended the payment to be. I consider the money was paid as bond.
Section 19 of the RTA sets out the “Duties of landlord on receipt of bond”, and confirms that the landlord: shall, within 23 working days after the payment is made, forward the amount received to the chief executive, together with a statement of particulars in the approved form signed by the landlord and the tenant.
For the purposes of this provision, the bond is considered to be lodged with the Chief Executive, by lodging the bond with the Bond Centre. The landlord has failed to lodge the bond as required by the Act.
Section 19(2) of the RTA confirms that failure to lodge the bond in accordance with the section 19 requirements, is declared to be an unlawful Act, and therefore could be the subject of an order of exemplary damages, and I have set out the relevant legal considerations for exemplary damages above.
The maximum levels of exemplary damages for a failure to lodge the bond is $1,500.00. 4
In this case I find that exemplary damages should be ordered because: a. I consider the landlords failure to lodge the bond is likely to intentional. The landlord is a very experienced landlord, and would have been well aware of her obligations around bond lodgment. 4 Schedule 1A. 31 b. The effect of the unlawful act is that the tenants bond money has not been kept securely, and even then, the tenants have needed to obtain an order from the Tribunal even to establish how much money they have paid to the landlord as bond. c. There are significant interests for tenants, landlords and the public generally that bonds are lodged as required by the RTA in a timely way, to ensure the robustness of the bond system. d. It would be just to make an order of exemplary damages.
I have determined that exemplary damages at 50% of the maximum is indicated. I have taken into account the experience of the landlord, who would have been well aware of her obligations, the vulnerability of the tenants, and otherwise the absence of landlord records establishing how much of the tenants money they landlord has unlawfully retained. Therefore exemplary damages of $750.00 is ordered for both tenants.
The landlord is further ordered to pay the tenants the retained bond money in full, that is $190.00 for [Tenant 1], and $380.00 for [Tenant 3]. FAILURE TO MEET LANDLORD’S ONGOING OBLIGATIONS – SECTION 66I
Mr Gray submitted that the landlord has breached her obligations in relation to section 66I, which requires the following obligations be met “at all times”: a. Ensuring the premises are reasonably clean. b. Ensuring the premises are in a reasonable state of repair. c. Complying with smoke alarm obligations. d. Complying with the smoke alarms and insulation regulations. e. Complying with all requirements in relation to buildings, health and safety. FAILURE TO ENSURE THAT THE FACILITIES OF THE PREMISES WERE IN A REASONABLE STATE OF CLEANLINESS – SECTION 66I(1)(A)
Mr Gray submitted that the landlord has failed to keep the facilities reasonably clean during the course of the tenancies as supported in the photographs, the evidence of the TCIT inspector and tenants. That evidence supported a conclusion that: a. There was widespread mould in the premises. b. The Respondent did not undertake general cleaning of the premises. c. There was rubbish and ‘rotting’ items left on the tenancy. d. The Landlord put the responsibility to clean the premises on the tenants. 32
The Applicant disputes there is evidence of vandalism which reflected the condition of the premises. The evidence did support a conclusion that there was mould and rubbish.
In response Mr Murray acknowledged that the photographs did not paint the premises in a good light, but they needed to be considered in context, the photographs were taken at the end of the COVID lockdowns, and the landlord had health issues around that time. Reference was made to Ms Sharp’s evidence around what maintenance she did do, and the fact that some of behaviours of the boarders were challenging. Otherwise it was submitted that expecting tenants to clean up after themselves was not unreasonable. It was disputed that the premises were mouldy, but the photographs showed wear that may have been misinterpreted as mould.
The landlord would undertake pest control, and provide a skip bin for tenants to use at no charge.
The photographs were taken following a period of vandalism.
It is disputed that the landlord would not act on complaints from tenants.
The question was posed, if the condition of the premises were so bad, then why did [Tenant 2] return to the boarding house? Analysis
Section 66I(1)(a) requires that: (1) The landlord of a boarding house must, at all times,— (a) ensure that the facilities of the premises are in a reasonable state of cleanliness;
The term ‘facilities’ is defined in section 66B as meaning the shared areas of the boarding house, for example the kitchen, lounge, toilet and bathroom, and wider grounds. The tenants are responsible for keeping clean and tidy the areas they have exclusive use of – that is their boarding rooms.
Mr Gray submitted that the ‘House Rules’ supplied by [Tenant 2], which included an expectation that tenants keep communal areas clean, and clean the bathroom, kitchen, toilet and lounge after use’ is supportive of the landlord putting cleaning responsibility on the tenants.
The House Rules require the following: Please keep your room clean and tidy. Please keep common areas and facilities clean. Please clean bathroom, kitchen, toilet and lounge after use. 33
It could also be viewed that the intention of those rules was to get tenants cleaning up after themselves, which is a reasonable expectation. There is a difference between a tenant cleaning up after themselves, such as doing their dishes after a meal, and expecting the tenant to undertake general cleaning duties. I consider a House Rule setting an expectation that a boarder clean up after themselves would be one a boarding house landlord could reasonably make under section 66O.
However, I do note the tenancy agreements provided, which record under the heading of “Tenant obligations” that the tenants were to “clean room and common facilities”, which does suggest an expectation for the general cleaning of common facilities was on the tenants.
When I consider the evidence available, and particularly the photographs, I consider that the landlord has not complied with her obligation to keep the facilities reasonably clean. As examples, the following photographs are from common areas inside the house: 34 35
I agree with the evidence of the tenants, that the premises was likely to be mouldy, the above photographs support that. Reference in the evidence was made to mattresses which had been dumped outside the house. The photograph shows considerable organic material on the mattress’s, which suggest these items had been outside for a considerable period of time. It was the landlord’s responsibility to have these removed: 36
I find the landlord has failed to meet her obligation under the RTA around keeping the facilities reasonably clean. FAILURE TO ENSURE THAT THE FACILITIES OF THE PREMISES ARE IN A RESONABLE STATE OF REPAIR – SECTION 66I(1)(B)
Mr Gray submitted that even taking into account that the buildings were at the end of their useful lives (they were demolished following the tenancies), the landlord failed to undertake maintenance of the premises as she was required to do.
Reference was made to: a. No light in the kitchen. b. Broken and boarded up windows. c. Holes in walls and floors. d. Rotting weatherboards. e. Inoperative bathroom. f. Rotten deck g. Missing gutters h. Extensive moisture ingress. i. Heater and oven disconnected. j. Electrical plugs and light fittings hanging from wall. k. Missing window latches. l. Missing toilet / bathroom door m. Laundry appliances not working. n. External shower not having working hot water.
While it was accepted the COVID situation did make it challenging to get tradespeople on site, work could still be undertaken for essential services even during the lockdowns and certainly following.
It was submitted by Mr Gray that Ms Sharp must have been aware of the issues with the premises, and that the reason maintenance was not undertaken was because of the intention to demolish the premises.
Mr Murray submitted that there was evidence that when renovations of rooms were requested, that work was done. The evidence of Ms Sharp was that a boarder had taken to the back deck with an axe, and that area and outside bathroom / laundry had been closed from use of the boarders because of that. It was submitted there was no intention for the premises to be in a state of disrepair
It was submitted that the photographs need to be considered in context given the building was at the end of its useful life. 37
The door to the outside bathroom (off the deck) was removed so the room could not be used as it was out of bounds, to ensure tenants safety.
The appliances in the laundry were not included as part of the tenancy. Analysis
Section 66I(1)(b) requires that the landlord maintain the premises: 66I Landlord’s ongoing obligations (1) The landlord of a boarding house must, at all times,— (a) ... (b) ensure that the premises are in a reasonable state of repair, having regard to the age and character of the premises and the period during which the premises are likely to remain habitable and available for residential purposes; and
The landlord’s obligation is to reasonably maintain the premises, the premises do not need to be kept in an exceptionally high standard, only reasonably maintained. That must be assessed in light of the age and character of the premises, and how long they are likely to be habitable and used at a boarding house. In this case it seems accepted by all parties that the premises were at the end of its useful life, and given the photographs I accept that is the case. But the fact the premises were at the end of its lifespan does not absolve the landlord from all maintenance obligations.
Taking those factors into consideration, I have no doubt that the landlord has not maintained the premises. That was the plain finding of Judge Clark in the District Court, as was it the Adjudicator who had originally considered [Appellant - redacted]’s claim. The premises were described as delipidated and would be my finding also.
Ms Sharp’s evidence was that: The Boarders never raised any concerns with the state of the repair of the boarding house while they lived there.
I do not accept that. I do accept the evidence of the tenants that they did complain about the state of the premises to Ms Sharp, and that the concerns were not addressed. The premises were in such poor state, it would be unrealistic to believe that none of the tenants complained about the premises. To use [Tenant 2]’s words from the hearing: Everyone complained. You did nothing Shirley Anne, that’s why. They just stopped asking you. 38
Ms Sharp’s evidence is also inconsistent with the statement of [witness 1], who was an employee of Ms Sharp (in an unrelated business). [Witness 1] stated that the boarders would at times ring the shop to leave messages for Ms Sharp, to report “repairs need to be done”. A similar statement as provided by another employee, [witness 2].
Ms Sharps evidence in her brief of evidence was that: In February 2020 Fiona and I decided to sell the property because I could not continue to run the boarding house due to my health and stress. The plan was to sell the property to a developer who would demolish the house. 5
That may logically explain why there was an absence of maintenance in the later period of the boarding house, that is that any funding of maintenance would be money that could not be recovered. But that said, based on the photographs, adequate maintenance has not been undertaken for years. I accept that some maintenance work was undertaken, but it was not enough. 6
In relation to the issues with maintenance set out by the Applicant, I conclude as follows: a. No light in the kitchen. The Applicants position is that there was no light in the kitchen. I accept that the main light fitting was not working, but also note the evidence from [Tenant 2] was that there was a single bulb around the sink that did work. Therefore, while I accept there was some light in the kitchen, the landlord should have repaired the existing light to ensure the kitchen was properly illuminated. b. Broken and boarded up windows. This is established in the photographs provided. I accept the tenants’ evidence that the windows were in that state for a long period of time. I also note [Tenant 2]’s evidence that the glass in the door between the lounge and the hallway had been broken for “a few years”, and similarly the broken kitchen window had been broken for “a couple of years”. 5 It is not clear why Ms Sharp indicated she and Ms Tugaga made the decision to sell the complex, given she was not the owner. 6 There is for example a statement on file from [glazier] recording that they did some maintenance work at the premises over the past 6-7 years, but there are no records of that work as they were paid for “cash jobs”. There are also similar supporting statements from [locksmith] and [flooring company], and [cladding company]. 39 c. Holes in walls and floors. This is established by the photographs. It is not a defence for the landlord to claim that this damage was caused by vandalism, and therefore not to fix it. The landlord is required to fix damage of this nature in common areas, however it was caused. The following photograph shows holes in the wall of the lounge: 40 d. Rotting weatherboards. This is established on the evidence. Weatherboards are of course a critical component in the weather-tightness of the home. When they breakdown, the premises leak, they become cold, damp and unhealthy. e. Inoperative bathroom. The premises were rented with an exterior bathroom, and the landlord should have fixed the bathroom or deck as necessary to ensure it could continue to be used. It is not acceptable simply to close it off and say to the tenants they could not then use it. The tenants’ evidence was that the exterior shower had no hot water. f. Rotten deck. I do not accept the landlords claim that the deck was damaged from vandalism. The damage shown on the photographs below is far more consistent with the deck having 41 rotted, and needing replacement. The deterioration of the deck would almost certainly have happened over the course of many years. I accept that in order to access the toilet and laundry facilities, the tenants would have needed to use the deck which presented clear safety issues. 42 g. Missing gutters. I accept the gutters were missing or defective. That was also confirmed on photographs provided. Gutters are a key component to ensuring the premises remain dry and healthy. h. Extensive moisture ingress. I accept the evidence of the tenants that the premises were cold and damp. 43 i. Heater and oven disconnected. If the premises are rented with heaters and an oven in-situ, then they should work. If they fail they should be repaired or replaced. I accept [Tenant 2] and [Tenant 1]’s evidence that not all of the gas burners worked, and that the oven did not work. The photograph shows the oven has been taped up. [Tenant 2]’s evidence is that this was a ”new stove” (which I take to mean a secondhand replacement) provided by the landlord, and that the oven on the prior stove did not work either. j. Electrical fittings hanging from wall. The landlord’s position is that this switch was not live. It is generally accepted that all electrical outlets should be treated as live. I have received no evidence from an electrician to say that these outlets were safe, or that having them in the state they were would be acceptable electrical practice - I am sure it would not be acceptable. 44 k. Missing window latches. I accept that the window latches were missing. Window latches are a health and safety issue. 45 l. Missing toilet / bathroom door. It would be humiliating for tenants to use toilet facilities without privacy of having a door. I accept this would be the toilet the tenants in the exterior cabins would use. Ms Sharp gave evidence in this hearing that the door was removed because the deck was not safe to use. But that seems inconsistent with the evidence recorded in the District Court decision, that the door had been vandalised. Based on the evidence of [Tenant 2], it seems that another tenant put up a sheet in front of the door to gain some measure of privacy, but that sheet went missing. In any event the landlord was obligated to ensure the deck and the exterior toilet was available for the tenants to use during the tenancy. m. Laundry appliances not working. The tenancy was rented with a laundry, so the laundry appliances needed to be maintained. The landlord stated that the laundry appliances were not provided as part of the tenancy. I have seen no evidence to support that, other than Ms Sharps 46 statement that was the case. That is not recorded in the tenancy agreements. Any reasonable tenant renting the premises, which had a laundry, would have anticipated the laundry was available and worked. I further note Ms Sharp advised that the washing machine was replaced three times, which would not be consistent with it not being part of the tenancy offering. n. External shower not having working hot water. Again the premises were rented with an external shower, so that facility needed to be maintained and work properly. 7
I find by a comfortable margin that the landlord has failed to ensure the premises are reasonably maintained. FAILURE TO COMPLY WITH ALL REQUIREMENTS IN RESPECT OF SMOKE ALARMS – SECTION 138A AND SECTION 66I(1)(BA)
Mr Gray submitted that the evidence was that there were no smoke alarms in the tenancy rooms, in breach of the landlord’s smoke alarm obligations.
It was submitted that the evidence of [Tenant 1] and [Tenant 2] were that there were no smoke alarms in their bedrooms, or within three metres of the entrance of their rooms.
Reference was made to Mr Schmidt’s inspection of [Tenant 2]’s room, and that there was no smoke alarm observed by the inspector.
Mr Gray noted that at the previous hearing Ms Sharp produced photographs of smoke alarms, but these photographs were not put to the witnesses earlier when they gave evidence. Because those photographs were not put to the witnesses, the Tribunal should be cautious about accepting the late evidence of Ms Sharp on this matter.
Because of the proximity of the premises to the boundary, and given the boarders would cook in their rooms, the risk for the occupants from fires were elevated in the context of vulnerable tenants.
Mr Murray submitted that the simple answer to this claim is that smoke alarms were installed. It was submitted that the evidence of Ms Sharp should be preferred, supported as it is by photographs. 7 The Housing Improvement Regulations 1947 require an adequate means to heat water in a bathroom is provided. 47
In the event they were not seen during inspections, the reason is because they had been taken down by the boarders. Reference was made to the photograph showing a bracket with a missing alarm. The respondent’s position is that there were smoke alarms installed, and there is nothing that can be done if the occupants take them down. Analysis
Section 66I(1)(ba) requires landlords of boarding houses to at all times ensure they comply with all requirements in respect of smoke alarms imposed on the landlord by regulations made under section 138A of the Act. The relevant regulations are the Residential Tenancies (Smoke Alarms and Insulation) Regulations 2016.
These regulations require that specific types of smoke alarms be installed in tenancies (qualifying smoke alarms), and that they be located in certain locations as a minimum. Those locations are: a. In every sleeping space (room), or b. Within 3 metres to the entrance of each sleeping space.
It can be accepted that the reference to smoke alarms within 3 metres of the entrance of a sleeping space would apply to an area such as a hallway leading to a bedroom in the main house. Because the cabins are standalone structures, then the landlord needed to have a smoke alarm in each cabin.
I accept the evidence of the tenants, supported as it is by the officials who inspected the premises, that there were no or inadequate smoke alarms provided by the landlord. I note that the provision of smoke alarms is such a fundamental requirement in tenancy law, that it would be unrealistic to consider that the TCIT inspector would not have been careful with checking for smoke alarms.
I consider on balance the landlord has not provided smoke alarms as required by the RTA and regulations, and that is an unlawful act.
In reaching that conclusion, I note that the landlord, late in the hearing, provided photographs which show only three smoke alarms, one stated to be from the hallway, and two stated to be in bedrooms. I agree with Mr Gray that limited weight should be placed on this evidence, because it was not put to the tenants or the inspectors to comment on.
The landlord also provided photographs of what appear to be one smoke alarm bracket, and what could be where a smoke alarm had been located given the shape of painting what appears to be screw holes. It is difficult to draw any conclusions from the assumed missing alarm given the paint markings, but I note that the smoke alarm bracket is covered in what appears to be mould or dirt, which indicates that that any alarm from that 48 bracket has been missing for a long time, perhaps years given the photograph.
The landlord has not convinced me that she did provide smoke alarms in all of the bedrooms, or within the necessary proximity to those rooms. Failure to provide smoke alarms in even one bedroom would be a breach of the landlord’s obligations as far as her obligations to all tenants are concerned, as the obligation complies to the entire tenancy premises. I find the landlord has breached her obligations to provide smoke alarms. FAILURE TO COMPLY WITH THE LANDLORD’S INSULATION OBLIGATIONS
It was submitted that the landlord failed to provide insulation in the premises, in breach of the insulation regulations. While the application was made in respect of the Healthy Homes Standards, the Applicant accepts the correct regulations are the Smoke Alarms and Insulation regulations 8 .
In relation to the submission that the cabins were on concrete slabs, it was submitted that is not supported in evidence. It was accepted that [Tenant 2]’s cabin was on a concrete slab, but it was submitted the other rooms are likely to have a suspended floors. Reference was made to the photographs taken under the main building which shows no insulation. It was submitted the exclusions were not put to the relevant witnesses. It was accepted that some complexity existed as to implementation dates for the HHS, but underfloor insulation was an obligation at that time.
Mr Murray submitted that the cabins were on concrete slabs, so insulation would only be needed in the main house. Further it was submitted that Ms Sharp’s understanding was that the insulation requirement did not come in until 2024, so intentionality is not met. Analysis
Section 45(1) of the Residential Tenancies Act 1986 (RTA) sets out the landlords responsibilities, and section 45(1)(bb) requires that the landlord insulate the premises in accordance with the Residential Tenancies (Smoke Alarms and Insulation) Regulations 2016 (the Regulations). The Regulations require ceiling and underfloor insulation.
From 1 July 2019, all residential premises must be insulated to a minimum standard.
Failing to comply with section 45(1) is deemed in the RTA to be an unlawful act. 8 Residential Tenancies (Smoke Alarms and Insulation) Regulations 2016. 49
The regulations include some exceptions. Premises do not have to be insulated, if an experienced professional installer of insulation cannot access the location to install the installation without carrying out substantial building work, or causing substantial damage to the premises, or if it presented a health and safety risk to install the installation (Regulation 18). However in this case I have been provided with no evidence from a qualified installer, supporting any such difficulty would exist in installing insulation in the cabins or to the main house.
Ultimately the main house had no underfloor insulation, as supported in photographs presented to the Tribunal. Because no exception has been established, the result is that the Landlord has breached her obligations around insulation.
I do not accept that the landlord would have been unaware of her insulation obligations. Landlords needing to insulate premises have been well known for many years, I cannot accept that Ms Sharp was not aware of this requirement. FAILURE TO COMPLY WITH ALL REQUIREMENTS IN RESPECT TO BUILDINGS, HEALTH AND SAFETY – SECTION 66I(1)(C)
The Applicant submits that the Respondent has failed to meets its obligations around buildings, health and safety in three respects: a. There was no approved form of heating in the premises. b. The premises were dangerous and insanitary in terms of the Building Act 2004; and c. The premises were in breach of the Resource Management Act 1991, and Auckland unitary Plan. a. Heating
Mr Gray submitted that exemplary damages should be ordered in relation to a failure not to have a heater in the lounge as required by the Housing Improvement Regulations1947. While there was a wetback wood burner in the lounge, it was not operative.
Mr Murray submitted that the evidence from Mr Sharp was that the heater worked, and that there was no evidence from the tenants that they had tried using the heater. In short there is no direct evidence that the heater did not work. Analysis
I agree with Mr Murray, the Applicant has not proven that the heater that was in the lounge was not working. The best that could be said is that the 50 tenants had an understanding that the heater was not working, but there is no evidence before the Tribunal of anyone trying to use the heater, and therefore confirming it did not work. To be clear, there is no evidence that the heater did work, but ultimately it is the Applicant who must prove it claim and this claim has not been proven. b. Property was dangerous and insanitary
Mr Gray submitted that the Auckland Council had determined the premises were dangerous and insanitary, as confirmed on the 2 September 2020 Dangerous and Insanitary Building Notice (DIBN). The premises were found to be in breach of section 121 of the Building Act, as the premises failed to have the necessary fire ratings, fire separations or walls. The example was given of [Compliance investigator]’s oral evidence around gaps existing in plaster board. The premises are located within a meter of the boundary, so the walls needed to be fire rated, and there is no evidence they were.
Further the premises would be deemed insanitary because there were insufficient toilet and shower facilities, and the buildings lacked adequate waterproofing allowing water ingress.
It should be viewed that the DIBN would apply over all of the buildings if there are safety or health issues with part of the building. Further the notices were not disputed at the time, and the buildings vacated as required under the notices.
Mr Murray submitted that the requirement that applies is when the work was done, not at the time of the inspection. When the buildings were built, there was no obligation for the current Building Code to apply. The obligations are not retrospective. Reference was made to section 17 of the Building Act 2004 and section 7 of the Building Act 1991. Mr Murray noted that position was accepted by [Compliance investigator] in evidence, but the witness was not able to say what the requirement were that existed prior to 2004. Noting that the premises operated as a boarding house since 1990, there is no evidence to show that the premises breached the relevant building obligations. Analysis
The evidence favours a conclusion that the buildings were dangerous and insanitary for the reasons set out widely in this decision above. Whether a conclusion is reached based on Building Act or the Residential Tenancies Act, the fact remains the premises were not fit for humans to live in. That was the conclusion of the inspectors from TCIT and the Auckland City Council, Adjudicator Watson, District Court Judge Clark, and it is my finding also. 51
The RTA requires that the landlord comply with all requirements in relation to buildings, health and safety, and I have no doubt the landlord has not met this requirement. c. Property breached section 9(3) of the RMA and Auckland Unitary Plan
Mr Gray submitted that an abatement notice was issued by the Auckland Council on 2 September 2020 in relation to the premises, in that a resource consent was needed to operate the boarding house premises from the location, and it needed to be set back a minimum of one metre from the boundary. The premises were over land owned by a neighbour (Kiwi Rail) that the Respondent only had a licence to occupy for beautification purposes, not building purposes.
Mr Gray submitted that it had not been put to [Compliance investigator] that the boundary had been extended given the Kiwi Rail lease, as [Compliance investigator] was using the fence line as the measure.
Mr Murray submitted that the Auckland Unitary Plan (H6.4.1(A11)) provides that boarding houses accommodating more than 10 people per site, inclusive of staff and residents is a discretionary activity. In this case there are only 10 boarding rooms, and the premises have not operated with more than 10 residents at any time, for the most part there were less than 10 residents. So no resource consent was necessary.
It was submitted by Mr Murray that the fact of the cabins being over the boundary was simply a technical breach, and does not take account of the land area covered by the Kiwi Rail licence, and does not make the premises non-complaint. Therefore the boundary went well beyond the boundary line applied by the Council inspectors.
In the Resource Consent Report of 28 August 2008, there is no suggestion that the cabins were non-compliant, save for them being built over the legal boundary. The requirement that the cabins be removed related to the cabin’s location on the land, not safety, so had no impact on the boarders. Analysis
The problem the landlord faces in relation to this claim, is that the District Court has already made findings in relation to these premises needing to have a Resource Consent to legally operate. That finding is now binding on this Tribunal.
I also make the observation that the obligation to obtain a Resource Consent would be on the owners of the premises, who were the respondents in the appeal before Judge Clark. Ms Sharp is not the owner, but did have the 52 obligation to ensure that the premises could be lawfully occupied for residential purposes, and she has failed to achieve that. Overall discussion of section 66I breaches
As discussed above, I find the landlord has breached her obligations under section 66I, in particular Ms Sharp has: a. Failed to keep the facilities clean. b. Failed to reasonably maintain the premises. c. Failed to provide smoke alarms. d. Failed to have the premise insulated e. Failed to ensure the premises comply with the landlord’s obligations around buildings health and safety
These are all breaches of the landlords obligations found in section 66I of the RTA. Schedule 1A sets out the maximum amounts that can be ordered for a breach of the RTA, and for Section 66I(4) – which these breaches fall within - that maximum amount is $7,200.00.
As the Tribunal had previously advised in its earlier decision of 12 August 2022, a global approach to the breach must be taken, meaning that only one maximum amount could be ordered for a breach, as supported by the District Court in Gardiner v Upland Bay Investments Limited (DC Wellington, CIV 2014-085-13, 27 August 2014) . Mr Gray submitted that the approach in Gardiner is inconsistent with the Interpretation Act 1999, and Legislation Act 2019 (s19). It is submitted that a globalised approach does not accord with a deterrence intention, and if a globalised approach was taken, then a wrongdoing landlord would avoid the full extent of potential liability, compared to claims brought individually.
Mr Murray submitted that this issue has already been determined in Tribunal’s earlier order, so that has settled this matter. Furthermore it is submitted that the Tribunal is bound by it.
I agree with the submission of Mr Murray, that this matter has been the subject of the earlier decision of the Tribunal, and I am bound by it.
I note however that I disagree that any unfairness arises as submitted by Mr Gray, because while the Tribunal could only make an order to the maximum level, the Tribunal can take into account multiple breaches by making an order for a sum which is more toward the maximum level of exemplary damages, than a more modest amount. That does meet the interests of deterring unlawful conduct.
In this case I find that exemplary damages should be ordered taking section 109 into consideration: 53 a. I consider the landlord has acted intentionally in all of these breaches. The landlord has operated these premises for an extensive period of time, and I am not at all persuaded that she did not know what her legal obligations were. b. The effect for the tenants is that they have lived in unsafe and unhealthy premises. These are vulnerable tenants. c. There are very strong interests for tenants, especially vulnerable tenants, landlords and the public generally, that boarding house tenancies comply with the prevailing legal obligations. d. I am in no doubt it would be just to make an order of exemplary damages.
I have determined that an order of exemplary damages at the same level as that ordered in the [Appellant - redacted] case, which is $3,000.00. I cannot see any compelling reason to depart from the approach previously taken by the Tribunal given the breaches are of a similar nature, and that level of penalty has been supported by the District Court. FAILURE TO PROVIDE DOCUMENTS – SECTION 123A
The applicant seeks an order of exemplary damages for the landlord’s failure to provide documents to the investigator, as required by section 123A, without reasonable excuse.
Mr Gray submitted that on 7 August 2020 the Applicant had requested a range of documents be provided pursuant to section 123A of the RTA, including tenancy agreements, inspection reports, maintenance and repair documents and proof of ceiling and underfloor insulation and smoke alarm status. The information was not provided by the requested date. A reminder and warning was also provided to the Respondent.
It was submitted that the documents that were filed by Ms Sharp for the purpose of the hearing, were within the scope of the request, and should have been provided at the time the documents had been requested.
In response, Mr Murray submitted that Ms Sharp’s evidence around documents being destroyed in a flood was not challenged, and therefore Ms Sharp should be accepted as having believed that everything had been destroyed, but it was only later that she found some documents. Analysis
Section 123A is a provision which sets out wide ranging documents that the landlord needs to retain, and provide to the Chief Executive (TCIT) if requested. That includes: 54 a. The tenancy agreement. b. Inspection reports. c. Records around building and maintenance work. d. Communications with the tenant.
S 123A(2) allows the Chief Executive to require the landlord to produce specified documents, and the landlord must then produce those documents within 10 days. Where a landlord fails to produce those documents, that is deemed to be an unlawful act.
I do not accept that the landlord could not produce the documentation as it had been destroyed. It is the case that the landlord did produce some of the requested documentation late in the hearing process, clearly that evidence had not been destroyed. In my assessment the landlord more likely than not had that documentation, but elected not to produce it as had been requested, or make reasonable efforts to find and produce it. Either way, I find the landlord has failed to comply with her section 123A obligations, and has committed an unlawful act.
Again I must take into account the factors set out in section 109 (the exemplary damages factors), and having done so, I have determined that exemplary damages should be ordered: a. I consider it most likely that the landlord’s decision not to produce this evidence was intentional. b. The effect was that the Applicant was obstructed from investigating the complaints which directly impacts the tenants. c. There are very strong interests for particularly tenants and the public generally that landlords produce information to the investigator as requested, to ensure that tenancies continue to be safe and healthy places for tenants to live, and that any other obligations are met. d. I consider it would be just in the circumstances of this case to order exemplary damage.
The maximum level of exemplary damages for a breach of section 123A is $1,500.00. In this case I consider an order at 50% of the maximum would be indicated. Therefore exemplary damages to the sum of $750.00 is ordered to be paid under each application. 55 UNLAWFUL RESIDENTIAL PREMISES / PROHIBITED TRANSACTION
Mr Gray submitted that a refund of rent should be ordered as the Respondent had engaged in prohibited transactions with the tenants, in that the premises were unlawful residential premises because: a. The premises as a whole were dangerous and insanitary buildings as defined in section 121 and 123 of the Building Act. b. The tenancies of the cabins ([Tenant 1], [Tenant 2] and [Tenant 4]) were unlawful as they straddled the Kiwi Rail land, so could not be lawfully built or occupied. c. The operation of the property as a boarding house was in breach of the Auckland Unitary Plan, as it needed a resource consent.
The Applicant approaches the matter on the same basis as the [Appellant - redacted] decision.
Mr Gray submitted that: the present case is clearly not one where, while technical issues made the Property unlawful, it was nevertheless “fit for purpose”. The state of disrepair of the Property, its lack of appropriate working facilities, and the fire safety risks it presented left the Property fit only for demolition.
In terms of the level of rent compensation, Mr Gray accepted that there was some benefit that the tenants had from the premises notwithstanding the defects with the dwelling
In terms of any Limitation Act 2010 issues, it was submitted that it only became a debt when the breach is determined. Mr Gray submitted that the time frame for the Limitation Act should only commence once the tenants would have reasonably know about the breaches on the part the landlord. From the perspective of the Limitation Act, the ‘late knowledge date’ would apply.
In response Mr Murray submitted that the building only became unlawful after the notice was issued, and the building was vacated shortly following, but in any event it was submitted that the abatement notices were flawed for the reasons set out in the Respondents submissions above. It becomes an arbitrary situation if looking for an earlier date.
It was further submitted that there has in fact been no breach of the RMA or other building obligations arise. Any encroachment of the boarding house over the boundary is a minor regulatory issue, and did not impact the boarders. 56
It was submitted that the Limitation Act would apply, so no order could be made prior to May 2015, and if any order was made it should be no more than at the 30% level, as taken in the [Appellant - redacted] decision. Analysis
Section 137 of the RTA relates to ‘prohibited transactions’. That provision confirms that: No person shall ...enter into any transaction or make any contract or arrangement, whether orally or in writing, or do anything, for the purpose of or having the effect of, in any way, whether directly or indirectly, defeating, evading, or preventing the operation of any of the provisions of this Act.
Section 137(4) confirms that all money other than lawfully charged rent needs to be refunded to the tenant as a debt.
Section 78A relates to unlawful residential premises. Unlawful residential premises are premises that could not be lawfully used for residential purposes, and the unlawful use arises from a breach of the landlord. Section 78A confirms that the Tribunal can make orders for the return of rent paid under its own initiative, that is without any application for that order.
For the reasons set out above, and as described in the [Appellant - redacted] decision from the District Court, the premises could not be lawfully occupied for residential purposes, and specifically: a. The premises were dangerous and insanitary given the lack of maintenance and other regulatory breaches. b. Some of the dwelling units (cabins) straddled Kiwi Rail land without the necessary consent or authority; and c. The premises as a whole required a Resource Consent given its size (as explained in [Appellant - redacted]).
I note that even if there had been only one established breach of those three matters, that would still make the premises unlawful residential premises, and the outcome would be the same.
Finding that the premises are unlawful residential premises, then I must consider Section 78A(4) which holds: (a) the Tribunal may order the landlord to pay to the tenant— (i) the whole of the sum found to have been paid by way of rent for the period for which the Tribunal is satisfied that the premises are or were unlawful residential premises; or 57 (ii) an amount that is the sum referred to in subparagraph (i) less any amount that the Tribunal is satisfied, having regard to the special circumstances of the matter, including the nature of the premises, it is fair to deduct:
This is a case where the Tribunal is satisfied that it would be reasonable to order a refund of rent to the tenants, noting that the premises would have been unlawful residential premises for the entirety of the tenancies. However in the special circumstances of this case, I do also consider it is reasonable to deduct from the refund a sum – to put that another way, it would be reasonable for the landlord to keep a portion of the rent paid. The approach taken by the Tribunal in the [Appellant - redacted] case, was that the landlord needed to refund to the tenant 30% of the rent paid. While the premises were rundown and dilapidated, and should not have been used for residential purposes, they nevertheless did provide a home to the tenants and did meet some of those needs. The approach taken by the Tribunal in [Appellant - redacted] was approved by the District Court as reasonable. I can see no compelling factors for these four tenants, which would lead to a conclusion that I should take a different approach to adjudicator Watson and Judge Clark.
The Landlord’s position is that the RTA confirms that the Tribunal must apply the Limitation Act 2010 (see RTA section 77(1)). The Limitation Act confirms that it is a defence to a money claim, if the claim is filed more than six years after the date of the Act or omission on which the claim is based.
However, the Limitation Act provides an exception to that rule if the claimant had “late knowledge of the claim” (s11(2)). Section 14 defines what the late knowledge date means, as follows: (1) A claim’s late knowledge date is the date (after the close of the start date of the claim’s primary period) on which the claimant gained knowledge (or, if earlier, the date on which the claimant ought reasonably to have gained knowledge) of all of the following facts: (a) the fact that the act or omission on which the claim is based had occurred: (b) the fact that the act or omission on which the claim is based was attributable (wholly or in part) to, or involved, the defendant: (c) if the defendant’s liability or alleged liability is dependent on the claimant suffering damage or loss, the fact that the claimant had suffered damage or loss: (d) ... (2) A claimant does not have late knowledge of a claim unless the claimant proves that, at the close of the start date of the claim’s primary period, the claimant neither knew, nor ought reasonably to have known, all of the facts specified in subsection (1)(a) to (e). 58 (3) The fact that a claimant did not know (or had not gained knowledge), nor ought reasonably to have known (or to have gained knowledge), of a particular fact may be attributable to causes that are or include fraud or a mistake of fact or law (other than a mistake of law as to the effect of this Act).
I could accept that the late knowledge period would be relevant for the technical breaches only (that is particularly the RMA and Kiwi Rail land issues). I would not consider that the tenants would have known about those breaches until after this was raised once TCIT and the Council became involved. I would accept that the conditions for late knowledge in subsection 1 above would all be met, to support that the late knowledge date should be applied for those breaches. To that extent, I accept that the landlord would not have a Limitation Act defence for the tenancies which commenced prior to 2015.
However I would not accept that the late knowledge date would be relevant for the breaches in relation to maintenance, insulation, cleanliness, bond etc. Those were fairly ordinary breaches that a reasonable tenant would have known about during the tenancy, and could have actioned earlier.
In the circumstances of this case, I have determined that it would nevertheless be reasonable to limit any order made for rent arrears reimbursement, to a maximum of a six year period, which will be relevant for the claims for [Tenant 2] and [Tenant 4]. I have taken this approach for these reasons.
Firstly, I accept that Ms Sharp would not have been the landlord when those tenancies commenced. Ms Sharp I accept took over as landlord around 2013.
Secondly, I consider taking any order to a maximum of six years strikes a balance between compensating the tenants for living in unlawful residential premises, and also taking into account that the tenants had a statutory obligation to mitigate any damage or loss (section 49), which is what the rent refund is ordered to compensate. As noted above, a majority of the landlords breaches would have been known to the tenants over the years.
I therefore order the landlord to reimburse the tenants 30% of the rent they have paid to a maximum of 6 years. I have calculated the amounts as follows. a. [Tenant 2] i. 2,190 days x rent of $24.29 per day, totaling $53,195.10
30% of total rent paid $15,958.53 b. [Tenant 1] i. 285 days x rent of $27.14 per day, totaling $7,734.90
30% of total rent paid $2,320.47 59 c. [Tenant 3] i. 1,019 days x rent of $27.14 per day, totaling $27,655.66
30% of total rent paid $8,296.70 d. [Tenant 4], i. 1,222 days x rent of $42.86 per day, totaling $52,374.92 ii. 287 days x rent of $34.29 per day, totaling $9,841.23 iii. 681 days x rent of $25.71 per day, totaling $17,508.51
Total rent paid for [Tenant 4] being $79,724.66
30% of total rent paid $23,917.40
The Applicant also seeks exemplary damages to the maximum of $1,000.00, being the level that applied when the tenancy agreements were entered into. Taking the section 109 factors into account, I consider that the landlord is likely to have entered into the tenancy agreements, knowing that the premises did not comply with the necessary requirements, the action was therefore intentional. There were significant effects for the tenants personally in this case. There are strong interests for tenants and the public particularly, that boarding house tenancies be safe and healthy premises. I have determined that an order at 50% of the maximum claimed would be indicated.

RESTRAINING ORDER

Section 109A provides the Tribunal with the authority to make restraining orders. That provision holds: 109A Tribunal may restrain further commissions of unlawful acts (1) If the Tribunal makes an order against a person under section 109 on the ground that the person has committed an unlawful act, the Tribunal may, if satisfied that it is in the public interest to do so, make an order restraining the person from committing a further act of the same kind. (2) The Tribunal may make an order under subsection (1) on its own initiative or on the application of the applicant who applied for the order, under section 109, against the person sought to be restrained. (3) The Tribunal must specify the term of the order, which may not exceed 6 years.
While the Applicant had initially applied for a restraining order, that request was not included in its final submissions. However section 109A provides the Tribunal with the ability to make a restraining order of its own motion. Normally the Tribunal would wish to see repeated breaches coming before the Tribunal before a restraining order is issued, but that is not mandatory. In this case I consider a restraining order is indicated because of the extent and seriousness of the breaches. It is plain that the landlord does not accept she has breached her obligations, and does not accept the findings 60 of the Tribunal and District Court in the [Appellant - redacted] case. That raises doubt as to whether the landlord would comply with her obligations in future tenancies.
Accordingly I consider that it would be reasonable to make a restraining order in this case, restraining the landlord for a period of 3 years, from committing further breaches in any other tenancy she is involved with, specifically in relation to the following landlords obligations: a. Failure to lodge bonds (s 19(1)(b)). b. Failure to provide premises that are reasonably clean (s 66I(1)(a)). c. Failure to provide premises in a reasonable state of repair (s 66 I(1)(b). d. Failure to provide smoke alarms (s 66I(a)(ba)). e. Failure to insulate premises (s 66I(1)(bb). f. Failure to provide lawful premises (s 66(1)(c)). g. Failure to provide documents to Chief Executive (s 123A(4)).

NAME SUPPRESSION

The Tribunal orders suppression of the tenant’s and identifying details as required by section 95A(2) of the RTA. Section 95A(4) provides the Tribunal with a discretion to order suppression to any other party either on application or its own initiative “having regard to the interest of the parties and to the public interest”. In this case the Tribunal orders that the names and identify detail of any other tenant in these premises be suppressed.
However the Tribunal declines to order name suppression for the landlord. The breaches of the landlord in this case are widespread and egregious, there are no factors present for the landlord, that would outweigh the usual expectations around the open reporting of justice, which is a strong public interest.

Tenancy Tribunal case 4303820 — Exemplary damages at 107 Blockhouse Bay Road, Avondale, Auckland 1026

Tenancy Tribunal case 4303820 — Exemplary damages at 107 Blockhouse Bay Road, Avondale, Auckland 1026

Order

TABLE OF CONTENTS

SUMMARY

Reasons

BACKGROUND

PROCEDURAL HISTORY

EVIDENCE GIVEN AT HEARING

RELEVANT LEGAL CONSIDERATIONS

ANALYSIS

RESTRAINING ORDER

NAME SUPPRESSION

Order

TABLE OF CONTENTS

SUMMARY

Reasons

BACKGROUND

PROCEDURAL HISTORY

EVIDENCE GIVEN AT HEARING

RELEVANT LEGAL CONSIDERATIONS

ANALYSIS

RESTRAINING ORDER

NAME SUPPRESSION