What was Tenancy Tribunal case 4550249 about?

The tribunal order states: By way of declaration, the premise known as 110A Marine Parade being the

How much money was awarded in case 4550249?

Property Damage: $200.00 awarded to tenant; Property Damage: $500.00 awarded to tenant; Filing Fee: $20.44 awarded to tenant; Rent Rebate: Breach S78A: $4,286.79 awarded to tenant

What type of tenancy dispute was case 4550249?

The primary dispute was Exemplary damages.

Where can I read the official tribunal order for case 4550249?

The official Ministry of Justice published order is available at https://forms.justice.govt.nz/search/Documents/TTV2/PDF/9325001-Tribunal_Order_Redacted.pdf.

What was Tenancy Tribunal case 4550249 about?

The tribunal order states: By way of declaration, the premise known as 110A Marine Parade being the

How much money was awarded in case 4550249?

Property Damage: $200.00 awarded to tenant; Property Damage: $500.00 awarded to tenant; Filing Fee: $20.44 awarded to tenant; Rent Rebate: Breach S78A: $4,286.79 awarded to tenant

What type of tenancy dispute was case 4550249?

The primary dispute was Exemplary damages.

Where can I read the official tribunal order for case 4550249?

The official Ministry of Justice published order is available at https://forms.justice.govt.nz/search/Documents/TTV2/PDF/9325001-Tribunal_Order_Redacted.pdf.

Unit/Flat A, 110 Marine Parade, Otaki Beach, Otaki 5512 Tenancy Tribunal Case 4550249 — Exemplary damages

Claims and awards in Tenancy Tribunal application 4550249 — net $5,007.23 NZD. Amounts reconciled from the published order (claims sum and net total). Verify on MoJ.
Claim	Tenant	Reason
Rent rebate: breach s78A	$4,286.79	Rent rebate: breach s78A
Exemplary damages: breach s45	$200.00	breach s45
Exemplary damages: breach s48(2)(d	$500.00	breach s48(2)(d
Filing fee reimbursement	$20.44	Filing fee reimbursement
Net award	$5,007.23
Total payable by Landlord to Tenant	$5,007.23

Claims and awards in Tenancy Tribunal application 4550249 — net $5,007.23 NZD. Amounts reconciled from the published order (claims sum and net total). Verify on MoJ.
Claim	Tenant	Reason
Rent rebate: breach s78A	$4,286.79	Rent rebate: breach s78A
Exemplary damages: breach s45	$200.00	breach s45
Exemplary damages: breach s48(2)(d	$500.00	breach s48(2)(d
Filing fee reimbursement	$20.44	Filing fee reimbursement
Net award	$5,007.23
Total payable by Landlord to Tenant	$5,007.23

Order

By way of declaration, the premise known as 110A Marine Parade being the side and upper residential unit of the building, is an unlawful residential premise.
Quinovic Property Management Limited must pay [The tenant/s] $5,007.23 immediately in accordance with the following table:
All other claims are dismissed.
An application for suppression has been made in this case, and the Tribunal orders suppression of the Tenant name and identifying details.

Reasons

[The tenant/s] resided in 110A Marine Parade from December 2021 until July 2023. Prior to the end of the tenancy, they applied to the Tribunal for relief as they alleged Quinovic had breached the Residential Tenancies Act 1986 (RTA) in a variety of ways. I cover each of these claims separately in this decision as follows.

Is this an unlawful premise?

110A is the side and upper section of a house that had been subdivided and rented out as a secondary household unit to the property numbered 110 since 2018.
[The tenant/s] say they became concerned that 110A was not lawfully established before they even moved in in December 2021. They were trying to set up the internet and electricity services so they would be working when they moved in but were not able to. They were subsequently told by [communications company] that the reason they could not have their own internet connection was because the property was only entitled to one, and that had been supplied to 110.
They say they raised the issue of lawfulness of the premise with the then property manager Melissa by text and orally, but she assured them it was legitimate. [The tenant/s] went so far as to search the property rating information which confirmed that 110A was not registered with the Council, a fact he advised Melissa of, however, his concern was dismissed.
The issue arose again in early 2023 when the census collector visited and told them there was only one household unit registered, and that 110A was not seen as a voting household. They raised this with their then property manager Kianna who they say was non-committal and said, “do what you have to do”.
Ms Hunt for Quinovic accepts that the property is unlawful but is clear they did not become aware until May 2023. She says the owner purchased the property set up as two homes however when they started renting them out in 2018 the issue of lawfulness was raised by the occupant of 110. At that time the owner contracted a builder to erect a fire wall and do what was needed to establish two lawful homes. She says the owner was assured by the builder that he had installed a fire wall and obtained consent from the Council for the variation. They relied on this oral advice, the property notes as held by [redacted] which state it is a multi-dwelling and consented plans they were provided with.
When the issue was raised again in May 2023 the owner obtained a builder’s report which confirmed the property had not been subdivided into two compliant separate household units. As soon as they received this information they met with the tenants and told them the tenancy would have to end. They agreed and moved out in July.
Ms Hunt says they genuinely relied on the information the owner gave them in 2018 which is why they were not concerned when [The tenant/s] raised the matter in 2021. She says they never intended to rent out an unlawful premise and that this was an honest mistake. They have offered [The tenant/s] compensation and help with their moving costs, but they have preferred to have the Tribunal decide the matter.
She says they work very hard to ensure their tenants have a positive renting experience with them which is reflected in the fact that they rarely come before the Tribunal. They are sorry for the experience the tenants have had but assure them it was a genuine error. The law and discussion
The Tribunal may declare a premise unlawful pursuant to section 77(2)(ac) of the RTA if they cannot be lawfully occupied and the landlord has caused or contributed to the unlawful occupation by failing to comply with sections 36 or 45(1)(c) RTA 1 .
Section 36 requires the landlord to take all reasonable steps before they rent out a property to ensure that there is no legal impediment to the occupation of the property for residential purposes. Section 45(1)(c) states that all tenanted properties must comply with all requirements in respect of buildings, health and safety under any relevant enactment.
I am satisfied that 110A Marine Parade is an unlawful premise as it clearly does not comply with the provisions of the Building Act 2004, in particular, sections 40, 114 and 115 of the Building Act. Those sections refer to separate household units having separate consents for their use, and any change in use must be notified to the Council. The consented plans provided to me are for one household unit, not two and date back to when the house was used for one family. No building permit or resource consent was ever obtained for converting this property into two homes.
110A therefore could not be “lawfully occupied” under s78A(2)(a) and (b) as a residential unit in its own right. This is because as a “household unit” in a single house zone the premises of 110 needed to be exclusively occupied as the home or residence of one household. In this instance there were two independent tenancies and household units: 110 and 110A.
What I must then consider is whether the landlord took all reasonable steps to ensure there was no legal impediment to occupation, i.e., did they contribute to the unlawful occupation? 1 S78A of the RTA
The statement from the owner says: I instructed my builder to complete a fire wall between the properties... I was of the understanding he had done the work and also taken the necessary steps with the Kapiti City Council to have the property compliant as a multi dwelling unit. I advised Quinovic that the property had been made compliant.
I do not consider it reasonable of the landlord to rely on a builder’s oral statement for the following reasons: a. Neither the owner nor Quinovic cited documents from the Council confirming the work in 2018 and the owner did not pay any consent costs. b. The pictures of the ‘fire wall’ show unsealed gib board. Even to an untrained eye, this wall does not appear complete. c. The issue had been raised by a knowledgeable tenant who was concerned enough to do so. d. The owner would have been aware that he was still only paying one set of rates for the property. e. A simple search on the Council website makes it clear there is no 110A.
Accordingly, I am not satisfied that the landlord took all reasonable steps to ensure 110A could be lawfully tenanted before it was in 2018.
I also consider they did not take the required steps in 2021 immediately prior to this tenancy. [The tenant/s] has provided a copy of a text message she sent to Melissa clearly stating their understanding that the property had been illegally subdivided, to which there was no response. When Quinovic became aware that [communications company] would only instal one ONT (Optical network terminal also known as a fibre box) because they only recognised the one household, the issue should have been investigated again.
This is not a situation of a landlord being unaware of the need to lawfully subdivide, but one in which the landlord had the issue raised with them in 2018 and 2021 (more than once) and failing to investigate sufficiently. Accordingly, I find that 110A Marine Parade cannot be lawfully occupied and the landlord caused or contributed to the unlawful occupation in accordance with s78(2) of the RTA.
Where it finds unlawful residential premises under s 78A(4), the Tribunal may order the landlord to: (i)repay the tenant all the rent they paid; or (ii)repay a lesser amount of rent repayment that it finds fair having regard to the special circumstances of the case, including the nature of the premises
The Tribunal may make either 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. Special circumstances have been explained by the Court of Appeal as “wide, comprehensive and flexible words indicating something abnormal, uncommon or out of the ordinary but something less than extraordinary or unique.” 2
I consider that special circumstances 3 should apply to this case because refunding all the rent would be unfair to the landlord as the tenants have had the amenity of living at the property and for the most part, other than is discussed elsewhere in this decision, they enjoyed their time there.
The Tribunal has determined a number of claims under s78A(4)(ii) RTA and in line with those determinations 4 I take into account the following: a. The landlord’s motivation for renting the property, and their conduct during the tenancy. Other than “being a bit slow” on some maintenance issues towards the end of the tenancy as discussed below, the tenants did not have substantial complaints of Quinovic’s conduct. I also accept Ms Hunt’s submission that they did their best to provide a healthy happy home for their tenants. b. The tenant’s motivation for renting the property and bringing the claim, and the length of and time they lived in the property. [The tenant/s] were at the property for over one and a half years and had renewed their tenancy to go into 2024. They did enter and renew the tenancy having concerns about the lawfulness of it; on the face of it therefore they were aware they were residing in a home that had not lawfully been subdivided. The main reason for them bringing the claim was an unlawful entry discussed later as they say this tipped them over the edge after not being heard on their concerns about lawfulness and maintenance. They mainly wish for this situation to not happen to another person which is a strong motivator for them in bringing this claim. c. The benefits the landlord received in renting the property. Clearly, they have had the benefit of rent for the duration of this tenancy, and the ones prior. d. The benefits the tenant received in renting the property. This is discussed above. e. The seriousness of the regulatory breaches making the premises unlawful. The home is not compliant with the Building Act and has raised practical 2 Kidd v Van Heeren (1997) 11 PRNZ 422 (CA) 3 s78A(4)(ii) of the RTA 4 In particular None v Khan [2022] NZTT 4344467 issues for the tenants in the provision of their services. It also was potentially unsafe given the lack of fire wall and other works being unconsented. Adherence to the Building Codes is important as those codes set out minimum standards on such matters as fire prevention and smoke alarms, insulation, ventilation, structural strength and integrity, escape routes for fire and sanitation. These are serious regulatory breaches. f. Any other breaches by the landlord. As discussed elsewhere. g. Any detriment or loss the tenant suffered. They had issues with their internet and power provision, they had to install their own letterbox, did not have assigned rubbish bins and had the frustration of their concerns being dismissed by property managers. The tenants have also had to move because of this failure. They were contracted to live there until 2024 at the least, and so have had to relocate earlier than expected and incur the associated costs. h. The purpose of s 78A in ensuring landlords do not unfairly profit from unlawful premises. The public policy behind the introduction of s 78A was to discourage landlords from renting out properties that were, for example, unconsented or unlawful and had therefore never been subject to the need to meet legal requirements to ensure their safe and healthy occupation by tenants. I do not consider Quinovic or the owner specifically in this category however they have been negligent in abiding by their legal responsibilities which cannot be condoned, especially in a property management company. Their negligence has also resulted in the two properties being rented out in an incompliant and potentially dangerous way. i. The clear public interest in discouraging unlawful tenancies given the potential dangers for tenants in living in unsatisfactory housing. j. Any other compensation or exemplary damages that are ordered. Discussed elsewhere.
Taking into account all of the above, but most importantly that the tenants were aware of the issue for the duration of the tenancy and Quinovic have taken the appropriate steps when the matter was clarified, I find it appropriate to refund the tenants 15% of the rent they have paid which is $4,286.79.

Has the landlord failed to maintain the premise?

[The tenant/s] claim that Quinovic has breached their obligations under section 45 of the RTA to maintain the premises in a reasonable state of repair and comply with any relevant enactment in relation to buildings, health and safety. Notably, the Housing Improvement Regulations 1947 specify the minimum standards of fitness for houses which include a requirement that every house be free from dampness (regulation 15). There are also obligations in the Building Act 2004 that note that a building is insanitary if it has insufficient or defective provisions against moisture penetration as to cause dampness in a building (section 123). Further, the Residential Tenancies (Healthy Homes Standards) 2019 (HHS) moisture ingress standard requires residential tenancies to have efficient systems to drain storm water, surface water and ground water, and that includes gutters, downpipes and drains, and requires a ground moisture barrier when there is an enclosed subfloor space.
The issue arose for them in November 2022 when they realised the bathroom window was leaking in heavy rain. They initially notified Melissa on 18 November but got no response. In their February inspection they left a note for Kianna about the leak which she acknowledges seeing. They received no response and on 5 April followed up saying: I believe there are a lot of leaks around the house as the roof is completely stuffed. Personally, I do not think this is a healthy home.
The other matters were attended to by a handyman on 6 April, but the leak was not progressed until a discussion in May 2023. A builder’s report obtained in May advised that the roof needed to be replaced and that is now underway.
Ms Hunt’s submission is that they did not think it was an urgent issue initially and thought it just needed to be monitored. She says the fact that the tenants renewed their lease just days after advising them of the leak indicated to them it was not major. Further, when Kianna attended in February it was a wet day but there was no evidence of a leak, so she assumed it just needed to be watched. She points out that the tenants never served them with a 14-day notice or explained the severity of the issue.
Quinovic’s obligation under section 45 is to investigate and repair a defect brought to its attention within a reasonable timeframe, the reasonableness being assessed by taking into account the nature and severity of the issue. A leak can be a serious matter and must, at the least, be investigated promptly.
In this situation, the evidence does not establish that the leak created an undesirable and unhealthy living environment, but it was certainly an inconvenience and worry to the tenants. [The tenant/s] sent photos in November showing water dripping and pooling, this was not responded to, let alone investigated. In February [The tenant/s] note raises the leak and the potential of mould. The inspection notes surprisingly say of the bathroom: ‘no leaks detected’. And then generally ‘potential leak in ceiling when raining but not always’.
The evidence is clear that Quinovic were on notice of a leak which was potentially serious from November but took no steps to rectify it until May the following year. I consider this delay unreasonable, particularly as the same issues had already been raised by the neighbour (with the same roof). This is a breach of s45 of the RTA.
Breaching s45(1) is an unlawful act for which exemplary damages may be awarded up to a maximum of $7,200.00. See section 45(1A) and Schedule 1A RTA.
Accordingly, I find Quinovic have committed an unlawful act in not investigating the leak earlier.
Where a party has committed an unlawful act intentionally, the Tribunal may award exemplary damages where it is satisfied it would be just to do so, having regard to the party’s intent, the effect of the unlawful act, the interests of the other party, and the public interest. See section 109(3) RTA.
Taking into account the factors of s109 in an assessment of exemplary damages, I note the following: a. There appears to be no reason why the initial notification in November was not responded to, particularly given the issue was live for 110 at the time. b. The tenants have had to raise the concern at least three times before action was taken. c. The property manager did not observe the leak in action at her inspection in February. d. The leak did not appear to create mould, but the tenants were concerned it was. e. The issues frustrated and worried the tenants. f. I do not accept Quinovic intentionally minimised this concern, but they were negligent in following it up, particularly upon receipt of the photos. g. It is clearly in the public interest that landlords take notification of maintenance issues seriously.
Having assessed all of the above, I consider that an award of $200 exemplary damages is appropriate in the circumstances.
With respect to the claim that the home is not HHS compliant because of the leak, I note that the property was required to be HHS compliant within 90 days of its commencement on 21 December 2021. Quinovic obtained a HHS report in January 2002 which noted the property as compliant. I accept this report and accordingly the claim with respect to the HHS compliance is dismissed.

Did the landlord permit the instal of a fibre connection?

The tenants also claim that Quinovic breached s45B of the RTA which states that a landlord must, except in certain circumstances, permit the installation of a fibre connection in the premises if— a. there is no fibre connection in the premises; and b. it is possible to install a fibre connection in the premises; and c. the tenant requests a fibre connection; and d. the fibre connection can be installed at no cost to the landlord (for example, because the cost is covered by the UFB Initiative).
A landlord who is required to permit the installation of a fibre connection must take all reasonable steps to facilitate the installation within a reasonable period of time and respond to the tenant’s request or that of a network operator within 21 days of receiving a request. Breaching any of these obligations without a reasonable excuse is an unlawful act for which exemplary damages may be awarded up to a maximum of $1500.00. See section 45B(6) and Schedule 1A RTA.
As discussed above, Quinovic did arrange a fibre connection for the tenants although not in the usual way as it was tapped from the neighbour’s connection. Although the tenants say it was not a consistent service, I am satisfied that Quinovic complied with s45B in this instance. Accordingly, this claim is dismissed.

Did the landlord enter the premise without notice?

On 6 April [The tenant/s] came home to find some maintenance they had been asking to be done had been, however they had not been advised of this. It transpires that Quinovic’s handyman had attended the property without giving notice to the tenants beforehand. Ms Hunt says they had used this handyman for many years, and he had always been reliable in giving tenants notice of his attendance. She says they were always very clear with him that he must do so, and until this occasion he had. Since this failure they no longer use him as a handyman as they work hard to only contract reliable trades.
A landlord may not enter a tenanted premise during a tenancy except with the tenant's consent, in an emergency, or after giving the required notice for inspections and repairs and maintenance pursuant to section 48(1) and (2) RTA. Breaching this obligation is an unlawful act for which exemplary damages may be awarded up to a maximum of $1,500.00. See section 48 (4)(a) and Schedule 1A RTA.
Quinovic is responsible for the actions of trades they employ to work in their properties. Accordingly, as s48(2)(d) has been breached here, I find Quinovic have committed an unlawful act. As above I consider an award of exemplary damages taking into account the s109 factors discussed earlier.
This event upset the tenants considerably, especially [The tenant/s]. They had personal and valuable items lying around and they felt their privacy had been violated. They were particularly upset about his visit into their bedroom to repair the deck; an issue they hadn’t even asked about. It was this event that stimulated their Tribunal application and resulted in such a level of distrust that they ensured they were always home for future attendances by the landlord or their agents resulting in losses of wages due to missing work to do so.
I do accept Ms Hunt’s submission that she was relying on a previously tested contractor, and to an extent she was entitled to do so. However, this was [The tenant/s] home, and they were entitled to privacy in their enjoyment of it. A breach of that, is a serious matter. I do take into account the fact that Quinovic no longer use this trade and for the remainder of the tenancy the property manager ensured she gave notice rather than expecting the trades to.
It is a common practice of property managers to rely on their trades to give notice to tenants before they attend properties, but it is not without risk. The responsibility at the end of the day lies with the landlord, it is therefore for them to ensure their obligations under the RTA are met. Best practice in this instance then would be for property managers to give notice as well or instead of their trades.
Having assessed all of the above, I find that an award of $500 is reasonable in the circumstances. Filing fee
Because [The tenant/s] have substantially succeeded with the claim, I have reimbursed the filing fee. Suppression
Section 95A of the RTA requires the Tribunal to supress a party’s name or identifying details if that party was “wholly or substantially” successful. Both parties have sought suppression but as only the tenants were successful to the statutorily required level, I only allow their application.

Tenancy Tribunal case 4550249 — Exemplary damages at Unit/Flat A, 110 Marine Parade, Otaki Beach, Otaki 5512

At a glance

Tenancy Tribunal case 4550249 — Exemplary damages at Unit/Flat A, 110 Marine Parade, Otaki Beach, Otaki 5512

At a glance

Award balance

Claims & awards

Dismissed claims

Order

Reasons

Is this an unlawful premise?

Has the landlord failed to maintain the premise?

Did the landlord permit the instal of a fibre connection?

Did the landlord enter the premise without notice?

Topics & place

Residential Tenancies Act sections

Key findings

Frequently asked questions

Award balance

Claims & awards

Dismissed claims

Order

Reasons

Is this an unlawful premise?

Has the landlord failed to maintain the premise?

Did the landlord permit the instal of a fibre connection?

Did the landlord enter the premise without notice?

Topics & place

Residential Tenancies Act sections

Key findings

Frequently asked questions