Published tribunal order
Tenancy Tribunal case 4402060 — Tenancy dispute
Decided 22 Jan 2024 · Published 22 Jan 2024 · Application 4402060
- Rent arrears
Party names are redacted in the official published order.
Order
- [The tenant/s] must pay [The landlord/s] $4,283.86 immediately, being costs.
BACKGROUND
- The background in this case has been set out in various previous orders, and I will therefore only summarise it here.
- [The tenant/s] was a tenant of [The landlord/s]. [The landlord/s] appointed [The property manager/s] to act as his agent (property manager).
- The tenancy did not go smoothly. The tenant made various complaints to the landlord about work being needed in the premises, but the tenant would not allow the landlord into the premises, other than on her terms, which limited the landlords ability to address the needed work.
- The landlord applied to the Tribunal for an order terminating the tenancy on the basis that the tenant was unreasonable in failing to allow entry to the premises to undertake the work needed (application 4402060). The original hearing was adjourned, but in adjourning the hearing the Adjudicator put the tenant on notice that she needed to allow entry to the landlord.
- The tenant declined the landlords entry following notice from the landlord, and trespassed various officers of [The property manager/s].
- The landlord filed a further application seeking to terminate the tenancy on the ground of rent arrears (4490560).
- The tenant filed wide ranging applications against the landlord (4508655).
- On 16 March 2023 an Adjudicator dismissed the rent arrears termination application, but adjourned the termination application for failure to allow entry. The Adjudicator recorded in her order that following discussion at the hearing the tenant agreed to allow the landlord entry. The Adjudicator put the tenant on notice that should she refuse entry as had been agreed “her tenancy is likely to be terminated when it next comes back before the Tribunal”.
- The tenant did refuse the landlord entry further to the premises, so the landlord applied to have a further hearing to progress the termination request.
- A further hearing was convened before the Adjudicator on 27 April 2023, both parties were represented by counsel. The Adjudicator accepted that the tenant failed to allow entry, and ordered a termination of the tenancy, with possession to return on 22 May 2023.
- The Tenant applied for a rehearing of the 27 April 2023 order. A hearing was directed in order to consider the rehearing request.
- The adjudicators who were considering the applications both recused themselves, and therefore the applications were allocated to myself.
- On 31 May 2023 the tenant withdrew her application against the landlord, that was 4508655.
- I convened a hearing on 6 July 2023, from which an order was issued on 7 July 2023. That order addressed multiple matters, but of relevance to this costs claim: a. Confirmed that [The property manager/s] was an agent of the landlord. b. Declined the tenants application for rehearing. c. Determined the amount of rent arrears owed to the landlord, and ordered the tenant to pay that sum. d. Adjourned the landlords application for costs to be determined on the papers. e. Continued name suppression for both parties as previously ordered.
LANDLORDS APPLICATION FOR COSTS
- The landlord has filed written submissions in relation to the costs application.
- The landlord seeks costs of $8,062.65. The landlord referred to section 102 of the Residential Tenancies Act 1986 (RTA), and submitted: a. The landlord was permitted to be represented by counsel at the hearing. b. The rehearing application was vexatious, flawed and doomed to failure, with arguments presented without evidential foundation, and sought to argue matters outside of the scope allowed with rehearing’s. c. The proceeding was delayed by adjournments from the tenant on a number of occasions, increasing the cost for the landlord. d. The tenant was unsuccessful in her rehearing request.
- The landlord submitted that: Lastly, throughout the proceedings before the Tribunal, and in respect of the tenancy generally, the Tenant has repeatedly made vexatious claims, threats, and levelled repeated abuse at the Landlord, its employees, and Counsel. The Tribunal was also not spared. The Tenant's actions have resulted in additional costs being incurred over and above those that might have been the case with applications of the nature of those in this case.
- The landlord recognised that typically the Tribunal would order a percentage of costs, but that in light of the conduct of the tenant, the full costs should be ordered.
- The tenant was given an opportunity to respond to the costs claim, which she did respond to, by email dated 31 July 2023. That email did not address the costs claim, other than to direct abuse at the landlord and its representative and Tribunal. The tenant also challenged [The property manager/s] as having authority to represent the landlord ([The landlord/s]).
ANALYSIS
- Firstly, I thank the parties for their patience awaiting this costs order. As there was another application before the Tribunal from the landlord against the tenant, I wished to address that matter first.
- I begin my noting that the amount of the legal costs charged to the landlord in this case, of $8,062.65, would not be at all surprising given the complexity and issues that needed to be addressed by counsel. To that extent I begin by accepting that the invoices raised by counsel to the landlord were reasonable. The question then is whether all or any of that cost can be ordered to be paid by the tenant.
- Section 102 of the Residential Tenancies Act 1986 (RTA) relates to costs. Section 102(2) confirms that the Tribunal “may make an order” where “any of the parties was presented by counsel”. Subsection 3 confirms that an order may be made to a party for “the reasonable costs of that other party in connection with the proceedings.”
- It is unusual for a Tribunal or Court in New Zealand to award full indemnity costs against the losing party.
- What is considered to be ‘reasonable costs’ will depend on a range of factors. In Holden v Architectural Finishes Ltd [1997] 3 NZLR 143 Justice McGechan, in his reserved costs decision, held that: ...the sum in issue is a ‘reasonable’ ‘contribution’. It is not some mere gesture. It is not some virtual payment in full. It is merely a contribution, and a reasonable one. At the outer limits, proportions of reasonable actual fees can afford some guidance. A 10% or even 20% contribution – very little indeed – may seldom qualify. A 90% or 80% contribution, virtually the total, may be regarded as likewise...if the ‘reasonable contribution’ earlier determined falls within a middle range, say 40% to 70%,there is a feeling of some comfort...
- The High Court confirmed that when a party is represented by counsel, that the following factors are relevant to be considered when assessing costs: a. The length of the hearing. b. The sum of money involved. c. The legal and factual complexity. d. Whether the argument lacking substance was advanced, and e. The degree of success achieved by the parties.
- Similarly in the judgment of David Blair Ltd v Hawkins Arms and Engineering Ltd (No 2) [1988] 1 PRNZ 162, Tompkins J considered a costs issue where the party was represented, and held: In addition to the length of the hearing, matters such as the amount of money involved, the importance either to the parties or generally of the issues, monetary or non monetary, the legal and factual complexities, the amount of time required for effective preparation, the number and complexity of interlocutory applications and the likely or actual solicitor and client costs incurred, may, in appropriate cases, be relevant to the exercise of the discretion.
- In relation to those factor, I conclude as follows: a. The length of the hearing. The hearing process was lengthy, particularly given the matters to be adjudicated. Overall I consider that the tenant has contributed to the hearing process being more involved than it needed to be. b. The sum of money involved in relation to the tenants claim which was withdrawn prior to the hearing was significant. No doubt the landlord would have needed to undertake preparation for that matter also. Otherwise the matters in dispute which related to a termination of the tenancy were very important for both parties. c. This case presented reasonably involved legal and factual complexity. The tenant raised wide ranging grounds in support of her rehearing request, which would have required counsel to prepare for and address. I am also minded that the tenant appointed her own legal representative, so it would be unsurprising that the opposite side had their own legal representative. d. As noted by counsel for the landlord, the tenant did not have any degree of success with her rehearing request. To be fair, the arguments presented by the tenant had been well thought out, and I accept that the tenant believed they were meritorious, notwithstanding the arguments not succeeding. e. The landlord had almost complete success in the claims, the tenant had no level of success.
- The landlord has submitted that the tenant acted vexatiously. Acting vexatiously means acting in a way to annoy the other party. There is merit to the landlord’s submission in this regard. The tenant’s approach to the landlord was aggressive and offensive. In that circumstance it was unsurprising that the landlord appointed a legal representative, in order to place some distance between themselves needing to interact in the case, and the tenant. I am also minded that much of the complexity of the proceeding sat with the approach of the tenant.
- When I step back and consider matters in the round, I have determined that an order that the tenant pay 70% of the landlord’s costs in this matter would be reasonable. I therefore order the tenant to pay costs of $5,643.86. R Woodhouse 18 January 2024