Published tribunal order
Tenancy Tribunal case 4502890 — Property damage
Decided 18 Aug 2023 · Published 18 Aug 2023 · Application 4502890
- Property damage
- Cleanliness
Party names are redacted in the official published order.
Order
- An application for suppression has been made in this case, and the Tribunal orders suppression of the Landlord name and identifying details. 2.
- This order is slightly amended from the earlier order due to a miscalculation and supersedes the earlier order of today’s date.
Reasons
- [The landlord/s] attended the hearing. There was no appearance by the tenants, nor any advice to the Tribunal of any reason they could not attend. The tenants were given time and opportunity to attend but as they did not, the hearing went ahead in their absence.
- The landlord has applied for compensation, refund of the bond, and reimbursement of the filing fee following the end of the tenancy. There are a number of claims relating to this seven-month tenancy which I deal with separately below. I note however that the landlord has received an insurance pay out for the majority of the claims. As the Tribunal can only award compensation for costs actually suffered, amounts covered by an insurance company will not be reimbursed in full. This is essentially to prevent “double- dipping”, i.e. claiming from a tenant and an insurance company for the same cost.
- The insurance company has effectively paid $21,151.76 for claims relating to replacement of the stove, damage in the kitchen, rubbish removal, key replacement, replacing the DVS controller, replacing the towel rail, lost rent for two weeks, replacing the carpet in the whole house, damage in the living room, landing, bathroom and bedrooms. [The landlord/s] has had to pay $6,000 being the equivalent of eight lots of the $750 insurance excess (calculated on a per room basis). Therefore, the loss to [The landlord/s] has been $6,000. As this amount is significantly less than the actual cost and accordingly takes into account depreciation and betterment (which is discussed below), I consider it reasonable and accordingly make the award.
- As each claim does need to be considered in its own merits, I do discuss each separately as follows.
Did the tenant comply with their obligations at the end of the tenancy?
- At the end of the tenancy the tenant must leave the premises reasonably clean and tidy, remove all rubbish, return all keys and security devices, and leave all chattels provided for their benefit. See section 40(1)(e)(ii)-(v) Residential Tenancies Act 1986 (RTA).
- The landlord has established in evidence that the tenants did not leave the premises reasonably clean and tidy, and did not remove all rubbish. In fact, the photos establish that no cleaning was done at all by the vacating tenants and a significant amount of rubbish was left by them. The house was left in an appalling state. The rubbish removal costs were covered in the insurance claim.
- [The landlord/s] claims $400 for carpet cleaning (invoice provided) and compensation for 20 hours of her and her husband’s time in cleaning. If a landlord conducts the work themselves and they are not a professional tradesperson, then it is not reasonable for them to receive compensation akin to that a professional tradesperson would receive. Therefore, the hourly rate attributed to their time when assessing the compensation is $25, which is considered reasonable.
- [The landlord/s] insurance company did not cover the cleaning costs therefore these are approved in addition to the insurance excesses as they are considered reasonable in the circumstances.
- The tenants did not return the keys, therefore they are responsible for the costs of replacing the locks which are covered in the insurance claim.
- The amounts ordered are proven in evidence.
Are the tenants responsible for the damage to the premises?
- A significant amount of damage occurred during this tenancy for which the landlord now seeks compensation. The damage is discussed below by categorisation of area, but I firstly detail the law with respect to damage.
- A landlord must prove that damage to the premises occurred during the tenancy and is more than fair wear and tear. If this is established, to avoid liability, the tenant must prove they did not carelessly or intentionally cause or permit the damage. Tenants are liable for the actions of people at the premises with their permission. See sections 40(2)(a), 41 and 49B RTA.
- Where the damage is careless, and occurs after 27 August 2019, section 49B RTA applies. If the landlord becomes aware of the damage after 27 August, the damage is presumed to have occurred after that date unless the tenant proves otherwise.
- Where the damage is caused carelessly, and is covered by the landlord's insurance, the tenant's liability is limited to the lesser of the insurance excess or four weeks' rent (or four weeks' market rent in the case of a tenant paying income-related rent). See section 49B(3)(a) RTA. The landlord’s insurance excess was $750 and the weekly rent $650.
- Where the damage is careless and is not covered by the landlord's insurance, the tenant's liability is limited to four weeks' rent (or market rent). See section 49B(3)(b) RTA. Where insurance money is irrecoverable because of the tenant's conduct, the property is treated as if it is not insured against the damage. See section 49B(3A)(a) RTA.
- Tenants are liable for the cost of repairing damage that is intentional or which results from any activity at the premises that is an imprisonable offence. This applies to anything the tenant does and anything done by a person they are responsible for. See section 49B(1) RTA.
- Damage is intentional where a person intends to cause damage and takes the necessary steps to achieve that purpose. Damage is also intentional where a person does something, or allows a situation to continue, knowing that damage is a certainty. See Guo v Korck [2019] NZHC 1541. Kitchen
- Early on in the tenancy the tenants damaged the oven the door panel to the extent that it could not be used. [The landlord/s] says they orally accepted responsibility for the damage and said they would replace it, however did not. When the property was returned to [The landlord/s] there was a knife on the element that appeared to have been used for cooking drugs. [The landlord/s] received advice that it would cost more to repair than replace the oven. Accordingly, she has replaced it and it is covered in the insurance claim
- The expected life of an oven in a New Zealand rental property is eight years. This oven was six years old at the end of the tenancy therefore to account for depreciation the cost of replacement would need to be reduced by 25%. Depreciation is linked to the concept of betterment. Everything is subject to wear and tear and will need to be replaced in time. Where an item has to be replaced as a result of tenant damage, this hastens the process. If the damaged item is replaced with a ‘better’ item, compensation is adjusted to reflect that. As the depreciated amount is still more than the insurance excess, the excess amount is ordered.
- The landlord has established in evidence that there was significant damage in the kitchen at the end of the tenancy that was not present at the commencement. In particular there were two holes in sliding door so significant that it had to be replaced. There were holes in the wall and one large one had been patched up with cardboard and tape. The glass door had been kicked in and smashed.
- Having assessed the photographs I am satisfied that the majority of this damage was intentional, and it is all well above fair wear and tear. Accordingly, the tenants are responsible for the repair cost which was included in the insurance claim. Living room
- There were significant holes in the walls in the living room however some had been repaired to an extent, but not completely. Further, one step of the carpet had been removed. I also accept this damage as a mix of careless and intentional and therefore find the tenants liable for the repairs. The repairs are included in the insurance claim. Landing
- [The landlord/s] has proven that damage to the walls on the landing occurred during the tenancy in the form of holes, cuts and dents. Again, I am satisfied that this damage is a mix of careless and intentional and therefore find the tenants liable for the repairs. These repairs are also included in the insurance claim. Bathroom
- In the bathroom a window was broken, there were holes in the walls and the heated towel rail had been ripped off. This was also careless and intentional damage, I find the tenants liable, and the costs are part of the insurance claim. Bedrooms
- There are three bedrooms all of which had varying damage to them. One door had apparently been jemmied open damaging it irreparably. There were holes, gashes and paint damage in the walls. Again, the costs were covered by the insurance company, and I consider them either careless or intentional and accordingly find the tenants liable for the insurance excess. Carpets
- The landlord seeks to replace the carpets due to the damage. They did have the carpets cleaned but it was not successful in removing the stains. The photos have shows burn marks and significant staining in all rooms well above what is fair wear and tear. There was a considerable amount of debris left on the carpets which also appears to have contributed to the damage.
- The insurance company has covered the cost of the replacement of the carpets which [The landlord/s] has now confirmed she will undertake as she now has the funds to do so.
- I am satisfied that it is proper to award the insurance excess as it is still significantly less than the depreciated amount of the actual cost as the carpets were installed in March 2021 making them two years old at the end of the tenancy. Current depreciation guidelines estimate that the life of carpets in a rental property to be approximately 10 years.
- Whilst [The landlord/s] has not yet replaced the carpets, I accept her evidence that she will do so and in the meantime has had to reduce the amount of rent she is receiving from the property due to the state of the carpets. Accordingly, I consider the amount awarded, being the insurance excess, reasonable in the circumstances. DVS control unit
- The tenants accepted to [The landlord/s] that they had damaged the DVS control panel unit. The tradesperson said likely someone had hit it or used force to it to create the damage it has sustained. I find this intentional damage and accordingly find the tenants liable for the repair. It is included in the insurance claim. Lost rent
- [The landlord/s] insurance company have paid her effectively two weeks lost rent due to the extent of work required in the circumstances. She has had to pay the excess for that claim.
- Compensation liability exists for foreseeable losses flowing from the breach of a tenancy agreement. I consider it foreseeable to the tenants that leaving the property in the state in which they did would require considerable time to remedy. I find two weeks a reasonable amount given the volume of work that was required. Accordingly, I find the tenants liable for this insurance excess claim. Filing fee
- Because [The landlord/s] has wholly succeeded with the claim I must reimburse the filing fee. Suppression
- Because [The landlord/s] have succeeded with the claim I have approved their claim for suppression pursuant to s95A of the RTA.