Published tribunal order
Tenancy Tribunal case 4525230 — Tenancy dispute at 26 Kohinoor Avenue, Mangere, Auckland 2022
Decided 21 Nov 2023 · Published 21 Nov 2023 · Application 4525230
- Healthy homes
Party names are redacted in the official published order.
Order
Hanifa Bibi must pay the Tenant $26,970.00 immediately, calculated as shown in table below:
Reasons
- Both parties attended the hearings on 29 May, 28 August and 8 November 2023. The landlord was represented by counsel Moira McNab.
- The tenant seeks a full refund of their rent paid during the tenancy and compensation after the 2023 Auckland Anniversary day flood/extreme weather events as well as reimbursement of all power charges of over $8,000 paid to the landlord for the tenancy of the downstairs one-bedroom unit of 26 Kohinoor Avenue, Mangere occupied from 3/5/2019 to 25/3/2023.
- The Tribunal may declare premises to be unlawful residential premises. See section 77(2)(ac) Residential Tenancies Act 1986.
- Residential premises are unlawful if they cannot be lawfully occupied for residential purposes, and the landlord has caused or contributed to the unlawful occupation by failing to comply with sections 36 or 45(1)(c) RTA. See section 78A(2) RTA.
- Where the Tribunal declares the residential premises to be unlawful, it must not make an order for rent arrears or compensation against the tenant unless, having regard to the special circumstances of the case, it would be unjust not to make the order. The Tribunal may order the return of all rent paid by the tenant, although it may deduct an amount from that sum if, in the special circumstances of the case, it would be fair to do so. The Tribunal may make any of these orders on its own initiative, even if the tenant has not applied for a particular order. See sections 78A(3)(a), (4) and (5) RTA.
- The total rent paid by the tenant over the 203 weeks tenancy was $68,600.00, with the last weekly rent paid on 26 January 2023.
- The tenant paid rent at $350.00 per week for 196 weeks. The tenant also paid a $600.00 bond to the landlord at the start of the tenancy; the bond was not lodged because the landlord considered (incorrectly) the tenant to be a flatmate under a house-sharing agreement.
- For these reasons, I determine the downstairs one-bedroom unit/section of 26 Kohinoor Avenue, Mangere to be unlawful residential premises: a. The downstairs one-bedroom unit/section of 26 Kohinoor Avenue, Mangere had been rented to the tenant as a standalone and self-contained premises in which the tenant had used and occupied it as their place of residence. b. The unit had been rented out to the tenant as a separate and second household unit from the upstairs premises which is occupied by the landlord. c. There is no evidence of fire rating protection or fire rated protected form of egress installed between the upstairs property and the downstairs unit occupied by the tenant. d. There is no council consent for the change of use from one to two household units for 26 Kohinoor Avenue, Mangere. e. The tenant was only expected to occupy and reside in their downstairs unit without access to the upstairs area which had been partitioned. In this sense, the areas of residency between the parties were not shared to form the basis of the purported house/flat sharing agreement that was entered into between the parties at the start of the tenancy.
- Section 114(2) of the Building Act 2004 provides that an owner must give written notice to the territorial authority (i.e. the Council) of a “change of use” and that such a failure, is an offence that can attract a fine of up to $5,000.00.
- Section 115 of the Building Act 2004, with reference to a “change of use”, states as follows: 115 Code compliance requirements: change of use An owner of a building must not change the use of the building,— (a) in a case where the change involves the incorporation in the building of 1 or more household units where household units did not exist before, unless the territorial authority gives the owner written notice that the territorial authority is satisfied, on reasonable grounds, that the building, in its new use, will comply, as nearly as is reasonably practicable, with the building code in all respects; and (b) in any other case, unless the territorial authority gives the owner written notice that the territorial authority is satisfied, on reasonable grounds, that the building, in its new use,— (i) will comply, as nearly as is reasonably practicable, with every provision of the building code that relates to the following: (A) means of escape from fire, protection of other property, sanitary facilities, structural performance, and fire-rating performance: (B) access and facilities for people with disabilities (if this is a requirement under section 118); and (ii) will,— (A) if it complied with the other provisions of the building code immediately before the change of use, continue to comply with those provisions; or (B) if it did not comply with the other provisions of the building code immediately before the change of use, continue to comply at least to the same extent as it did then comply.”
- While the whole premises at 26 Kohinoor Avenue, Mangere was consented for residential use, there was no consent granted for “a separate household unit” on the downstairs area.
- Had consent for “a separate household unit” been applied for, then “the separate household unit” would have been subject to more rigorous protections to ensure it complied with the building code and contained for example “a means of escape from fire, protection of other property, sanitary facilities, structural performance, and fire-rating performance.”
- As required by the Building Act 2004, the landlord did not obtain consent to incorporate in his dwelling “a separate household unit” and did not notify the Council of this “change of use” for the downstairs one-bedroom unit/section of 26 Kohinoor Avenue, Mangere that was rented out to the tenant.
- Therefore, the landlord did not take all reasonable steps to ensure that, at the commencement of the tenancy, there was no legal impediment to the occupation of the premises for residential purposes (section 36 RTA).
- The landlord also failed to comply with all requirements in respect of buildings, health, and safety under any enactment so far as they apply to the premises.
- The landlord’s failures have caused the occupation of the downstairs area of the property to be unlawful and the landlord has contributed to that unlawful occupation.
- Section 78A(4)(a) of the Act provides that 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 (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.
- The Tribunal had addressed a number of cases where garages, basement conversions or parts of premises being used as a larger household unit have been converted for residential use and then rented out as a separate household unit, without Council consent as to the change of use. Those premises themselves may have had the necessary building consents but there is no Council approval for the use of the premises as a separate household unit.
- Abaid v Mounsouphom [2019] NZTT Manukau 4181975 concerned a garage conversion where the tenant was awarded a 50% rent refund.
- In None v None [2021] NZTT [Event location suppressed] 4295031 the tenant was awarded 50% of rent back after tenanting a separate sleepout not consented for use by Council as a sleepout.
- A basement converted into two separate household units resulted in an award of full refund of rent to the tenant in Haldane v Liu [2019] NZTT Auckland 4202359, 4212111.
- In Zowitzkey v Hemmings [2020] NZTT North Shore 4257512, 4264964, the tenant occupied a lower level of two story house which change of use was not consented by Council and the premises did not have a consented kitchen. $7,100 was refunded to the tenant.
- The premises in Wilding-James v Dormer [2020] NZTT North Shore 4273164, 4279391 was a converted barn where the tenant was refunded 50% of the rent.
- In Redacted v Kranenberg [2021] NZTT4298196, 4294929 the property comprised of two properties but it was only consented to be used as one residential dwelling; two-thirds of the overall rent paid was refunded to the tenant.
- I have had regard to the special circumstances of this matter before me, including the nature of the unit that has been rented out.
- The unit was generally habitable and had an attached toilet and shower facilities. It has a benchtop and basic cooking facilities. The unit has internal wall insulation.
- Apart from the landlord’s failure to comply with requirements in respect of buildings, health, and safety identified above, the tenant had apparently been able to live in relative comfort in the standalone 1 bedroom unit for 4 years, albeit with the inconvenience and these conditions identified by the tenant: a. Inadequate heating; there was no heatpump in the downstairs unit. b. Lack of a full oven. c. Lack of full/proper kitchen facilities.
- The tenant had a roof over their head for 4 years in the 1 bedroom downstairs area where they paid $350.00 rent per week.
- The tenant had also listed a home baking business operating from the premises. Without casting any aspersion on the legality or otherwise of the home baking business, the fact remains that the tenant had adequate cooking facilities while residing at the premises.
- The power was shared and the tenant paid 50% of the power charges on demand by the landlord.
- Photographs show that the walls had internal insulation batts.
- Evidence was led by the landlord on the tenant having carried out electrical work on the switchboard despite the tenant not being a qualified or registered electrician. However, I do not consider this fact to have any material bearing to the nature of the unit that has been rented out or the special circumstances of this matter before me. The fact that the tenant is a handy but unqualified/unregistered electrician only tells us that the tenant had tried their best to make the unit as habitable and as comfortable as they can despite the general failings of the premises identified above.
- I accept that a conservative and reasonable figure of rent payable on a fully consented, safe, healthy and adequate 1 bedroom unit in the neighbourhood is substantially above the $350.00 paid by the tenant per week.
- Considering the above special circumstances of this matter, including the nature of the unit that has been rented out, I consider it fair to order the landlord to return to the tenant a total sum of $23,520.00. This sum equates to a third of the total rent paid by the tenant in renting the unlawful residential premises; it is calculated at $120.00 per week for the 196 weeks of rent paid.
- The award of rent refund takes into account the entire rent for the tenancy that should be refunded to the tenant pursuant to section 78A(4)(a)(i) of the Act, and the deduction that section 78A(4)(a)(ii) allows on the rent refund due to the special circumstances of the matter as set out above.
- In the upshot, the tenant would have only paid $230.00 a week for the one bedroom unit that they tenanted instead of the $350.00 weekly rent that they actually paid.
- I also consider it fair and appropriate that the tenant should be reimbursed a portion of the power charges paid during the tenancy. I do not consider that the tenant should have paid 50% power for their occupation of the 1 bedroom downstairs area even though they would have used power during their occupation of the premises.
- It is difficult to fully account for what the tenant should have paid in power charges for the 4 years that they are there but considering the overall number of occupants (2) living at the premises, I order the reimbursement of a portion of power charges paid during the 4 year tenancy, including the tenant's share of the Entrust power dividends, in the sum of $2,500.00.
- The landlord accepts the tenant’s claim for compensation of 5 days’ accommodation costs after the 27 January floods of $350.00. I make this award accordingly.
- There will also be an order for the tenant’s bond of $600.00 to be returned by the landlord.