Published tribunal order
Tenancy Tribunal case 4589097 — Rent arrears at 24 Heywood Crescent, Epsom, Auckland 1023
Decided 19 Oct 2023 · Published 19 Oct 2023 · Application 4589097
- Rent arrears
- Healthy homes
- Mould & damp
Party names are redacted in the official published order.
Order
- The Tribunal orders suppression of the tenants’ names and identifying details.
- The Bond Centre is to pay the bond of $900.00 ([Bond number suppressed]) to [The tenant/s] immediately.
- Slpm Limited must pay [The tenant/s] $920.44 immediately as set out in the table below:
Reasons
- Both parties attended the hearing. The landlord was represented by Paul Dawson, who attended by phone from Christchurch. Both tenants appeared in person.
- These are cross-applications. The landlord and the tenants have both filed claims in the Tribunal.
- The landlord claims that the tenants entered into a tenancy agreement that began on 26 February 2023 and was for a fixed term until 25 February 2024. They say that the tenants ultimately refused to move in and they had to find new tenants. The landlord seeks rent for the period up to 3 April 2023 (being $3,857.14) after which when new tenants moved in, together with compensation for the costs involved in finding a new tenant of $342.70.
- The tenants claim that they paid one week rent as a deposit and one week of bond but that they did not ultimately ever reach agreement with the landlord on the terms of the tenancy, they did not sign the tenancy agreement and the property was not in a habitable state and that they never moved in. They seek refund of their bond and the deposit paid.
- The primary issue to be determined in this case is whether there was a tenancy agreement. Background
- The tenants explained that their property was affected by flooding in Auckland in January 2023 and they set about urgently looking for a property to rent while their home was being repaired.
- The tenants initially viewed the property on 20 January 2023 and applied for the tenancy the same day. The landlord sent the tenants an email the same day stating “we are happy to offer you a tenancy ... starting from 26 February 2023 fixed term for 1 year at $900 per week for a family of 5 and an outside dog”.
- A telephone discussion then took place later that day as the funding for the tenancy was to come from the tenants’ insurers. The tenants made the landlord aware that their ability to sign a fixed term tenancy agreement was dependent on their insurer’s approval. The parties agreed that the tenants would pay one week of rent and one week of bond as a deposit which the tenants paid that afternoon.
- The landlord sent the tenants a written tenancy agreement the next day but the tenants did not sign it.
- No pre-tenancy inspection was conducted and no report was provided but the landlord assured the tenants that they already had photographs from January 2023 when the previous tenant had vacated. The landlord sent the tenant photos of the keys hidden at the property.
- The tenants went to move in on 26 February 2023 and discovered that the property had not been cleaned. They sent a message to the landlord stating “we started moving in an upon closer inspection have noticed that it is extremely unclean, not just dust and cobwebs but mould and what appears to be bird feces on the walls. We won’t start moving in today”
- Between 26 and 28 there were various communications between the landlord and tenants in which the tenants sought to liaise with the landlord’s cleaners. There was no power at the property and so the tenants’ attempted to arrange for it to be connected.
- On 28 February 2023 the tenants sent an email to the landlords, responding to the original email offering the tenancy stating “We just heard back from our insurance company. They want to know if there will be any penalty fee for cancelling the accommodation before 12 months. This will be sent to IUNZ for process”.
- By 1 March 2023 the property had still not been cleaned (although it was cleaned in the early hours of 2 March 2023 but the tenant disputes that it was cleaned properly) and the tenants discovered that while they could connect the electricity they could not connect the gas as the property had been disconnected for more than six months. They advised the landlord that a gas fitter needed to come to the property to issue a new Certificate of Compliance before someone could be sent to reconnect the gas. I was advised by the tenants that gas was required for both cooking and heating water at the property.
- On Sunday 5 March 2023 the landlord sent a Certificate of Compliance to the tenant so that the gas could be connected.
- Although the tenants had not yet been able to move in, the landlords sent an email on 7 March 2023 advising that a further week of rent was due and that they were three days in arrears. The tenants advised that they did not intend to move in.
Was there a tenancy agreement?
- A tenancy agreement is a contract. The law of contract applies to tenancy agreements, together with the provisions of the Residential Tenancies Act 1986 (“RTA”).
- It is possible for a tenancy agreement to have been reached even when a written tenancy agreement has not been signed. Although Section 13 of the RTA states that all tenancy agreements must be in writing and signed, Section 13C provides that no tenancy agreement shall be unenforceable on the grounds that it is not in writing.
- In order to determine whether a contract (residential tenancy agreement) existed the following matters need to be considered: (a) the making of an offer; (b) the fact of acceptance of an offer so that an agreement has been reached; (c) consideration; (d) Intention to create legal relations; (e) The requirement of certainty – whether the terms are sufficiently certain for the parties to be legally bound.
- Having carefully reviewed all of the evidence in detail, and having heard the parties’ submissions at the hearing, I do not consider that there was a tenancy agreement. While the landlord made an offer, the tenant made it clear that they were unable to enter into a fixed term tenancy without the approval of their insurer. It appears that the tenants assumed that they could move in on a “periodic tenancy” basis until that approval was obtained but that never eventuated as the property was not ready for the tenants move into. In my view there was no clear acceptance or sufficiently certain terms.
- I consider that my interpretation of the evidence accords with Section 85 of the RTA which provides that:
- Even if I had found that the parties had entered into a tenancy agreement I would have found that the tenants were entitled to cancel that agreement as it was incapable of being performed. The property had not been cleaned and could not be connected to services until 8 days after the “agreed” start date.
- It follows that the landlord’s claim for rent arrears and compensation is dismissed.
- Because Slpm Limited wholly succeeded with their claim I must reimburse the filing fee. The tenants are also entitled to an order for name suppression pursuant to Section 95A RTA.