What was Tenancy Tribunal case 4627167 about?

The tribunal order states: The tenant’s name and identifying details must not be published.

How much money was awarded in case 4627167?

Cleaning: $185.00 awarded to landlord; Cleaning: $175.00 awarded to landlord; Filing Fee: $20.44 awarded to tenant; Pet Deodorant: $36.99 awarded to landlord; Property Damage: $546.25 awarded to tenant; Reimbursement Of Cost Of HHS Report: $149.00 awarded to tenant; Rent Arrears: $1,028.57 awarded to landlord; Rent reduction: 10% between 17/2 - 2…: $2,082.86 awarded to tenant

What type of tenancy dispute was case 4627167?

The primary dispute was Rent arrears. Related themes: Property damage, Cleanliness, Healthy homes.

Where can I read the official tribunal order for case 4627167?

The official Ministry of Justice published order is available at https://forms.justice.govt.nz/search/Documents/TTV2/PDF/10132581-Tribunal_Order_Redacted.pdf.

What was Tenancy Tribunal case 4627167 about?

The tribunal order states: The tenant’s name and identifying details must not be published.

How much money was awarded in case 4627167?

Cleaning: $185.00 awarded to landlord; Cleaning: $175.00 awarded to landlord; Filing Fee: $20.44 awarded to tenant; Pet Deodorant: $36.99 awarded to landlord; Property Damage: $546.25 awarded to tenant; Reimbursement Of Cost Of HHS Report: $149.00 awarded to tenant; Rent Arrears: $1,028.57 awarded to landlord; Rent reduction: 10% between 17/2 - 2…: $2,082.86 awarded to tenant

What type of tenancy dispute was case 4627167?

The primary dispute was Rent arrears. Related themes: Property damage, Cleanliness, Healthy homes.

Where can I read the official tribunal order for case 4627167?

The official Ministry of Justice published order is available at https://forms.justice.govt.nz/search/Documents/TTV2/PDF/10132581-Tribunal_Order_Redacted.pdf.

886 Mount Eden Road, Three Kings, Auckland 1024 Tenancy Tribunal Case 4627167 — Rent arrears

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886 Mount Eden Road, Three Kings, Auckland 1024 Tenancy Tribunal Case 4627167 — Rent arrears | TenantCheck

Claims & awards

What this tenancy cost at tribunal — claim, category, amount, and party awarded, with reconciled net total.

Claims and awards in Tenancy Tribunal application 4627167. Amounts reconciled from the published order (claims sum and net total). Verify on MoJ.
Claim	Landlord	Tenant	Reason
Cleaning cost: 25	$175.00		Cleaning cost: 25
Carpet cleaning cost	$185.00		Carpet cleaning cost
Pet deodorant	$36.99		Pet deodorant
Rent arrears to 28/07/23	$1,028.57		68. Where, as in this case, a tenant is justifiably concerned that the premises do not comply with the HHS and that is proven to be the case, I consider the Tr…
Rent reduction: 10% between 17/2 - 28/7/2023		$2,082.86	Rent reduction: 10% between 17/2 - 28/7/2023
Reimbursement for cost of electrical repairs		$546.25	Reimbursement for cost of electrical repairs
Reimbursement of cost of HHS report		$149.00	Reimbursement of cost of HHS report
Filing fee reimbursement		$20.44	Filing fee reimbursement
Total award	$1,425.56	$2,798.55

Claims and awards for application 4627167. Verify on MoJ.

Cleaning cost: 25

Amount: $175.00
Awarded to: Landlord
Reason: Cleaning cost: 25

Carpet cleaning cost

Amount: $185.00
Awarded to: Landlord
Reason: Carpet cleaning cost

Pet deodorant

Amount: $36.99
Awarded to: Landlord
Reason: Pet deodorant

Rent arrears to 28/07/23

Amount: $1,028.57
Awarded to: Landlord
Reason: 68. Where, as in this case, a tenant is justifiably concerned that the premises do not comply with the HHS and that is proven to be the case, I consider the Tr…

Rent reduction: 10% between 17/2 - 28/7/2023

Amount: $2,082.86
Awarded to: Tenant
Reason

Claim types — money lines allowed on this order

Carpet Cleaning Cleanliness Filing Fee Property damage Rent arrears

Order

The tenant’s name and identifying details must not be published.
The bond is to be refunded to the tenant immediately.
The May Limited must immediately pay [the tenant] $1,372.99 as calculated in the table below.

Reasons

The tenant attended the hearing with a support person.
Fiona Feng and Selina Yu attended for the landlord. Ms Feng managed the tenancy and is closely connected with it. Ms Yu is an experienced property manager who has regularly appeared before the Tribunal. She joined the May Limited recently.
Cyril Young, a Mandarin interpreter, attended for Ms Feng. 2
The tenant claims the landlord failed to maintain the premises, did not comply with the Healthy Homes Standards (HHS), and seeks an order for the early end of the fixed term. She seeks compensation as the remedy for the breaches, and reimbursement for the cost of an electrical contractor, and a HHS report.
The landlord claims for rent arrears and compensation for the cost of cleaning the premises after the tenancy ended. Background
The tenant and her elderly parents moved into premises because the tenant’s home was damaged by flooding. The tenancy was to be for a short term while the tenant’s own home was repaired. The tenancy agreement was for fixed term beginning 17 February 2023 and ending on 31 December 2023.
The premises themselves were the larger part of a circa 1940s’ concrete Art Deco house. A smaller part of the house was not part of the tenancy and was sectioned off. The landlord’s text dated 9 February 2023 confirmed: Given that you are a family, rent the 4 rooms seen today for a discounted rate of $900 per week...
At the case’s last call, the Tribunal raised an issue as to the premises’ legality: 3
As several of the issues relate to what appears to be a division of one house into two or more tenancies (for example the alleged dangerous wiring, the power issues, and the gas bottle usage), I expect the landlord to file evidence regarding the consents obtained and legality of the conversion.
At hearing the landlord maintained that the house was not divided into two tenancies. However, the tenant says she is sure that other tenants lived in the other part of the house. 1 This is a reserved decision. I heard the matter on 1 March 2024. 2 Mr Young kindly came to court at short notice because a Mandarin interpreter had not been booked in advance of the hearing. 3 Paragraph 7 of Adjudicator M Allan’s directions dated 6 September 2023.
During the tenancy, tenant complained to the landlord about maintenance issues, including a faulty stove element, the electrical wiring, and the toilet. The parties disagree on whether the landlord adequately responded to the tenant’s complaints.
The tenant left the tenancy before the end of the fixed term. She applied to the Tribunal on 10 July 2023 for formal order to end the tenancy early. However, the tenant and her parents decided they could not wait for a Tribunal hearing. On 24 July 2023, the tenant emailed the landlord: I am writing to inform May Property of my decision to terminate the fixed-term tenancy... ...I am now facing significant health and safety concerns due to unresolved repairs that have persistently neglected for the past five months. These concerns have reached a critical point, impacting the well-being of both myself and my elderly parents. Regrettably, I can no longer continue to reside in the property under these circumstances. ...The house will be vacant from the 28 th of July onwards.
The landlord disputes that there is a proper basis for ending the tenancy early.
The issues that arise for determination are: a. Did the landlord fail to maintain the premises? b. Did the landlord fail to comply with the HHS? c. Was the premises an unlawful premises? d. Should a rent reduction be ordered? e. Should the term of the fixed-term tenancy be reduced? f.Should the landlord be ordered to reimburse the tenant for the costs of the electrician and the HHS report? g. What does the tenant owe for unpaid rent? h. Should the tenant reimburse the landlord for cleaning costs?

Did the landlord fail to maintain the premises?

Under s 45(1)(b) of the Residential Tenancies Act 1969 (RTA), landlords must maintain the premises in a reasonable state of repair. That provision provides: 45 Landlord’s responsibilities (1) The landlord shall— (a) ... (b) provide and maintain the premises in a reasonable state of repair having regard to the age and character of the premises and the period during which the premises are likely to remain habitable and available for residential purposes...
Compensation is available if a breach is proven. However, exemplary damages are not available because the tenant did not apply for exemplary damages prior to the hearing. 4
Landlords are liable for defects that they have knowledge of. They must repair defects within a reasonable time once they acquire such knowledge. As the author of Residential Tenancy Law in New Zealand explains: 5 The landlord’s obligation of repair is not absolute. A landlord does not have to foresee a latent and unobservable defect before it causes damage... A landlord therefore must repair within a reasonable time after knowledge of the need for repair: 6 “...the obligation of the landlord, under s 45, is to investigate and repair a defect brought to its attention within a timeframe which is reasonable in the circumstances and as to what that time is, I think, depends not only on the gravity of the problem but also on the objective evidence of the attempts made by the landlord to investigate, and put right, whatever the problem might be...”
Landlords also have an obligation to repair things that are apparent from observation: 7 However, notice from the tenant is not needed if the landlords knew of the need for repair or the need for repair is apparent from observation...
On 28 February 2023, the tenant emailed the landlord complaining of maintenance issues, including: a. One stove element not working. b. Bedroom light could not be turned off. c. Backflow leak and smell problem with the toilet. 4 Residential Tenancies Act 1986 (RTA) s 45(1A) and Schedule 1A. Exemplary damages of up to $7,200 may be awarded.. 5 Stewart Benson Residential Tenancy Law in New Zealand (2018) Thomson Reuters at 6.18. 6 Collins v Professionals Hutt City Ltd DC Wellington CIV 2009-085-1431, 24 February 2010 at [15]. 7 See n 5. Stove
On 10 April 2023, the tenant emailed the landlord about the stove again: One of the heating plates don’t work, this has been raised since day 1. Please advise when will this be fixed.
The landlord provided the tenant with a portable plug-in stove rather than repairing the faulty element. Ms Feng said that tenant’s mother who did most of the family’s cooking was happy with the solution.
The tenant says the landlord should have spoken to her, not her mother. She maintains the family were not happy with the get-around solution. The tenant’s 14-day notice dated 23 April 2023 stated that eight weeks after the issues had been reported, the landlord had not fixed either the stove element or the toilet. Toilet
On 3 March 2023, the landlord responded that the toilet smell issue was likely due to the tenant’s dog.
The tenant says the toilet was never fixed. The landlord maintains that the toilet was in good working order and refers to a “Plumbing Inspection Report” dated 31 March 2023, that records in summary: All plumbing in the bathroom is in proper working order with no leaks, blockages, and normal flushing. There are no abnormal noises during use, and overall condition of the bathroom is good for regular use.
The tenant played an audio recording taken on her cell phone of the sound the toilet made. The recorded noise sounded loud and unpleasant.
The landlord maintains its property manager never heard the sound and its contractor confirmed the toilet was in good working order. Electrical wiring
On 3 and 5 April, the tenant reported that the laundry light was not working.
On 12 April 2023, the tenant emailed the landlord that the lights for the side of the house where the toilet and bathroom were located were not working: Fuse has popped in the main switch board and when switching back on it won’t stay. We need this urgently fixed as is very dangerous to use toilet/shower with no light at all.
The landlord responded at 12:09pm the next day to arrange a repair.
On 23 April 2023, in her email accompanying the 14-day notice for the tenant also stated that “Light in laundry does not work, (hasn’t worked since start of the tenancy)”.
The landlord maintains that the necessary repairs were done within the 14-day period despite their contractor having to return several times because the tenant’s dog, which had a “guard dog” tendencies was not removed from the house when they attended.
At about 7:31pm on 8 May 2023, the tenant texted the landlord: Urgent – bathroom power went out again tonight, fuse tripped off. Please repair asap as it is dangerous shower in the dark.
At 4:44pm the next day the tenant having not heard from the landlord, emailed: I contacted you on the emergency contract number...no one has replied it has been 24hours without response from landlord. It is an urgent matter as I explained, we cannot see anything in shower/toilet it’s completely dark and it is slippery and dangerous, people will fall over/injur. I have now phoned an electrician to attend the problem asap and will sent you the invoice.
The tenant then sent through her electrician’s receipt for $546.25 at 5:23pm that day.
The landlord says that they never received the tenant’s text. Ms Feng highlighted the tenant’s contractor’s invoice was forwarded less than an hour after the tenant’s 4:44pm email. The landlord did not approve of the repair and replied, “Therefore, we refuse to pay this so-called bill.”
The tenant’s electrician’s invoice dated 22 May 2023 recorded that the “Circuit breaker kept tripping at random moments (Lighting circuit)”. The contractor located a fault, carried out a repair, and found no fault afterwards. However, the tenant says the contractor told her they found illegal wiring that they could not fix. A later email from the electrician’s company states: Based on our electrician’s notes, there were 2 households on the property with cross-wiring between them. Unfortunately, we were not able to access this property to investigate.
The landlord accepts that wiring was old as it had been wired a long time ago. It commissioned its own electrician’s report dated 15 May 2023 that found in respect to the bathroom: Following a thorough examination, all electrical components in the bathroom demonstrate proper functionality, with no signs of malfunctions or potential hazards. Discussion
The landlord did not fix the defective stove element. To the tenant’s annoyance, the property manager was more comfortable communicating with the tenant’s mother in Mandarin, and her mother was content with using a plug-in stove top. However, the tenant repeatedly asked for the element to be repaired. The tenant’s mother was not a tenant, so did not have the power to agree to the element not being repaired. The landlord never repaired the element so there was a low-level breach by the landlord of its obligations.
I do not find it proven on the balance of probabilities that the toilet was malfunctioning. The tenant did not produce evidence from a contractor to rebut the landlord’s contractor’s evidence that the toilet was in good working order.
The tenant complained about mould. However, it was not proven there was anything defective in the house that contributed to the mould.
The tenant complained of being without hot water for a week. That was due to a gas bottle not being refilled. It was not proven that the landlord breached any duty in that regard.
I accept the tenant’s evidence that the wiring circuit serving the bathroom’s lights repeatedly failed. The tenant’s electrician found a fault in the redundant bathroom light switch. The laundry light did not work. While the landlord’s electrical person found the bathroom’s electricals satisfactory, I consider that it is more likely than not that the premises’ wiring was overall not in a reasonable standard of repair. The wiring was old by the landlord’s own admission. I consider it probable that it was obsolete for modern living, was getting worn, and therefore the bathroom circuit regularly failed. The wiring’s obsolescence was exacerbated by (as will be discussed below) another household sharing the house’s old and outdated wiring. Conclusion
I am satisfied that the landlord did not provide and maintain the premises in a reasonable state of repair in respect to the stove element and the electrical wiring.
The tenant has not sought exemplary damages. They are therefore not available.
The issue of compensation will be discussed below in respect to the issue of whether the premises is an unlawful premises and whether a rent reduction should be ordered.

Did the landlord comply with the HHS?

Under s 45(1)(bb) of the RTA, landlords must comply with the HHS which require the premises to be insulated, draught free, ventilated, and protected from water ingress.
The tenant provided a Healthy Homes Standards Report dated 27 July 2023 which found the premises failed to meet the water ingress and the draught standards in that: a. A section of guttering was damaged. b. There were a few gaps around the windows.
The landlord submitted a HHS certificate confirming that the premises complied with the HHS.
The tenant’s HHS report was comprehensive and well set out. The landlord’s HHS was not supported by a report.
It is possible the premises met the HHS at the time the landlord’s contractor provided a report. I do not find it proven otherwise.
However, I accept the tenant’s HHS report’s findings. I am satisfied that the premises did not meet the drainage and ventilation standards at the date the assessment was done on 27 July 2023 due to the damaged guttering and excessive window gaps.
The tenant did not formally seek exemplary damages prior to hearing, so exemplary damages are not an available remedy at this time.
The issue of compensation for loss of amenity and for the cost of the report will be discussed below in the context of whether a rent reduction should be ordered for the premises being unlawful.

Was the premises an unlawful premises?

Legal principles

The Tribunal may declare premises to be unlawful residential premises under s 77(2)(ac) of the Residential Tenancies Act 1986 (RTA).
Under s 78A(2) of the RTA, 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: a. s 36 of the RTA (take all reasonable steps to ensure that, at the commencement of the tenancy, there is no legal impediment to the occupation of the premises for residential purposes); or b. s 45(1)(c) of the RTA (comply with all requirements in respect of buildings).
Where the Tribunal declares the residential premises to be unlawful, it 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: s 78A(4)(a) of the RTA.
Relevantly for this case, household units may not be divided into smaller household units without fulfilling change of use rules which involve Council issuing a Certificate of Code Compliance. Section 115(1) of the Building Act 2004, provides: 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... Discussion
The parties’ written communications refer to other tenants being next door. On 6 July 2023 for example, the tenant emailed the landlord: My mother advised me that May rang her personally to accuse her for not changing gas bottle which caused next door tenants no hot water to use. These gas bottles are shared between two tenancies of yours...
The tenant was adamant that people were living in the portion of the house that the tenant and her parents were not living in. She saw the tenants in passing, they parked their cars outside and she could hear them inside the other unit. She did not go into the other unit, but the same tenants were there month after month, not just for a few days or week.
In its earlier decision, the Tribunal directed the landlord to provide evidence about the legality of the conversion of the household unit. The landlord provided no evidence because it says there was only one household unit: the unit the tenant occupied.
The plan of the premises attached to the tenancy agreement shows that the smaller separated-off part of the house contained rooms named: study room, entrance hall, porch, master bedroom. There is also an unnamed room which depicts a bathroom with a bath, toilet, and washing machine.
The landlord maintains that the other part of the house was used only to store the owner’s furniture, and nobody lived there. Ms Feng says some of the owner’s employees used the adjacent sleepout, which was not attached to the premises. The tenant must have seen the sleepout’s occupants and mistakenly thought they were living next door.
I prefer the tenant’s evidence on this matter. The tenant does not lack any of her faculties. She can see and hear. My impression from her interactions with the Tribunal is that she is intelligent and observant. It is not probable that she would be mistaken about what she saw and heard to such a significant extent that she would mistakenly believe the landlord’s tenants were living next door when they were actually living in the sleep out. There is no comment in any of the communications to suggest that the other tenants did not live immediately next door.
The plan of the smaller part of the house is about 40m 2 and easily large enough to be used as a living area. The plan does not contain an area described as a kitchen, but occupants could simple cooking appliances such as a microwave or hot plate or installed a basic kitchen.
It is not probable that the tenant erroneously believed people were living in the other part of the house or that the landlord was unaware that her tenants were living there. Conclusion
I am satisfied on the balance of probabilities that the other part of the house was occupied by other tenants of the landlord as a separate residential unit.
Accordingly, 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.
For these reasons, the premises were unlawful under s 78A(2) of the RTA.
The Tribunal will declare that the apartment was unlawful premises.
I must now consider whether the Tribunal should order the landlord to repay any of the rent.

Rent repayment?

What factors should be considered in quantifying a rent reduction?

Where it finds premises are unlawful residential premises under s 78A(4) of the RTA, the Tribunal may order the landlord to (i) repay the tenant all the rent they paid; or (ii) 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.
Section 78A(4)(ii) should be applied to this case because repayment of the all the rent would not be proportionate the circumstances here.
I must carefully weigh what amount of rent it is fair for the landlord to repay considering the nature of the premises and the other circumstances of the case.
The other “special circumstances of the case” the Tribunal must have regard to are not stated. It is left to the Tribunal to determine what the other special circumstances might be.
A useful starting point is to consider the factors suggested by Janet Robertshawe 8 in her paper addressing this issue after s 78A’s introduction to the RTA. She suggested the following factors as relevant “circumstances of the case”: 9 a. The landlord’s knowledge and motivation for renting the property, and their conduct during the tenancy. b. The tenants’ knowledge and motivation for renting the property and bringing the claim, and the length of time they lived in the property. c. The benefits the landlord received in renting the property. d. The benefits the tenant received in renting the property. e. The seriousness of the regulatory breaches making the premises unlawful and any other breaches. f.Any detriment or loss the tenants suffered. g. The purpose of s 78A in ensuring landlords do not unfairly profit from unlawful premises. 10 8 Janet Robertshawe was then a highly experienced tenancy adjudicator. She is currently the Principal Disputes Referee. 9 See Janet Robertshawe’s 2019 conference paper, “The Legacy of Anderson v FM Custodians: Section 78A Tenancies”. Applied for example in AD v Gao [2021] NZTT North Shore 4260212 and Tenant v Kranenburg [2021] NZTT 4298196, 4294929. 10 Anderson v FM Custodians Ltd [2013] NZHC 2423. h. The public interest in discouraging tenancies of unlawful premises. i.Whether exemplary damages or compensation is ordered for other related breaches. j.Any other relevant matter. 11 The nature of the premises
The house is in a generally acceptable condition commensurate to its age. The house’s wiring needs work.
The house was not fully compliant with the HHS at least towards the end of the tenancy, but the deficits were of a lower order.
Sectioning off part of the house would not have impacted greatly on the amenity in the larger par of the house, although it may have compromised the ability to ventilate the premises. The seriousness of the breach
The Court of Appeal in Parbhu 12 disparaged a sledgehammer response of a full rent reduction in response to “relatively footling” breaches: The effect of relying on that provision is that any relatively footling breach by a landlord (for instance, the incomplete planning or building consenting of an otherwise eminently safe and sound accessory unit)...would compel total restitution of rent paid regardless of the degree of benefit.
Consistently with these comments in Parbhu, any rent repayment the Tribunal orders should be proportionate to the seriousness of the breach. At the least serious end of the scale where there is a minor building consent irregularity, but the premises are “eminently safe and sound” a full rent reduction is not called for. 11 See n 9: “The opening words to s78(4) state that it does not limit the generality of s77, or the nature or extent of the orders that the Tribunal can make in relation to the matter. However, it is submitted that the framework in (4) should be used when it applies, and to calculate a deduction (if any) from the starting point of all rent paid rather than building up individual breaches without reference to that benchmark.” 12 Want v Parbhu & Patel as Trustees of the Impala Trust [2019] NZCA 674 at [31].
In Chen v Kumar 13 the premises had been consented for use as a rest home (upstairs) and a residence for the past owner and family (downstairs). Originally, the rest home and residence were not physically divided but some years before the tenancy, someone had built-out access between the upstairs and downstairs to create two separate residential units. The landlord, Mr Chen, was convinced that he could lawfully rent the downstairs premises out. The Tribunal found however, the premises were unlawful and ordered about 70 per cent of the rent be returned to the tenant, which amounted to $45,000.00.
In the District Court, Judge DJ Clark agreed with the Tribunal that the premises were unlawful. However, he considered that on the facts as he found them, the rent reduction must be drastically reduced. Importantly for his decision, Mr Kumar very much wanted to stay in the premises and the premises were not “unsafe”: [95] Furthermore, Mr Kumar and his family enjoyed the occupancy of a premises and received the full benefit of those premises throughout the course of the tenancy. He wanted the tenancy to continue. I do not accept then the unit is necessarily “unsafe” given Mr Kumar’s enjoyment of the same. Arguably it falls into the category contemplated by the Court of Appeal as being technically in breach of planning or consenting obligations but otherwise could be safe. Certainly, until February 2021 Mr Kumar thought so as he wanted to remain there. [96] The Tribunal ordered Anemax (and now the landlord through my order) to pay Mr Kumar the sum of $45,000 (being a 30% reduction on the total rent paid). For the reasons set out I quash that order given that I find Mr Kumar had the full benefit of the premises during the tenancy, which including a discount during the period of construction.
His Honour reduced the rent to be refunded to $2,000.00. That amount also took account of rent arrears of $3,165.71 (which the Tribunal had also declined to order). The District Court rent reduction of $2,000.00 amounts to about 3 per cent of the total rent paid. 14 If the $3,165.71 arrears are factored in the reduction is about 7.5 percent. 15
In Kemp v Elliot 16 the premises’ passed its final inspection which found the build to have been completed in accordance with the building consent. The final inspection report recorded that Council should issue the CCC upon the landlord paying the appropriate application fee. 13 Chen v Kumar [2022] NZDC 7783. 14 The rent due to 9 March was $66,874.29. 15 The rent due to the end of the tenancy was $68,445.71. 16 [2022] NZDC 17792.
Kemp is an exemplar of “the incomplete planning or building consenting of an otherwise eminently safe and sound accessory unit”.
The Tribunal had ordered 30 per cent rent reduction (based on findings of fact that the District Court did not adopt), which resulted in a refund rounded up to $20,000.00. 17 However, Judge D J Clark quashed the Tribunal’s order and substituted an order for a rent reduction of $2,000.00. That figure amounts to a rent refund of about 3 per cent.
The facts in this case differ from the District Court cases. In Kumar only a technical breach was proven, the tenants very much enjoyed the premises and were desperate to stay. In Kemp the premises had passed a final inspection and only a fee had to be paid for the CCC to be issued.
In this case, there were more than technical barriers to obtaining a CCC. For example, firewalls between the two premises, and separate up-to-Code wiring would have been required. The landlord’s knowledge of the breach and motivation for renting, and conduct
The landlord knew that the other part of the premises was occupied. It likely considered there was no harm that would come from letting out part of the house separately.
The property manager and the tenant fell out over a variety of things including the tenant’s dog and whether repairs were properly done. Overall, the landlord met its maintenance obligations. The wiring was the most concerning problem. The existence of two dwellings sharing the same electricity exacerbated the substandard wiring and probably contributed to the premises’ bathroom lights regularly failing. The tenant’s knowledge and motivation
The tenant was motivated to, at short notice, find a safe, pleasant, and affordable place to live while her own home was repaired. She did not know the premises were not lawful. The Tribunal detected that as an issue after the tenant brought her claim before it. 17 The total rent due to the end of the tenancy was $63,607.14. The benefits the parties received
The tenant benefited from having a reasonable place to stay. The landlord received rent. Any detriment to the tenants
The tenant suffered some loss of expected amenity in the premises due to the poor electrical failures and the draught among other things of a lower order. Unfair profit and the public interest
Section 78A addresses a concern that landlords do not unfairly profit from unlawful premises and there is a public interest in discouraging tenancies of unlawful premises.
These factors call for the rent reduction to be set at a level that deters and landlords from running the risk of renting out unlawful premises by depriving them of any unfair rental profit. Other related orders made in the case
In this case, the Tribunal will not make any other order for compensation or exemplary damages.
The Tribunal could make compensation orders under s 45(1)(b), and (bb) of the RTA. However, I consider that s 78A can do the work in this case. A further order for compensation for a breach of s 45 would be double-counting. Conclusion
Weighing these factors, I find special circumstances to award less than a full rent reduction.
I consider a 10 per cent reduction of the rent paid is an appropriate amount to order.
It follows, the Tribunal orders the landlord to reimburse the tenant $2,082.86.

Should the fixed term of the tenancy be reduced?

The premises were unlawful residential premises. They should not have been rented out. The unlawful situation contributed to the premises’ electrical wiring problem and made the premises less safe than they should have been because there should have been for example a firewall between the two premises.
In the circumstances, I consider the tenancy should be reduced to the date the tenant moved out: 28 July 2023. 18 Should the landlord reimburse the electrician’s costs?
Under s 45(1)(d) of the RTA, landlords must compensate the tenant for reasonable expenses they have incurred to repair the premises. The paragraph provides that the landlord “shall”: (d) compensate the tenant for any reasonable expenses incurred by the tenant in repairing the premises where— (i) the state of disrepair has arisen otherwise than as a result of a breach of the tenancy agreement by the tenant and is likely to cause injury to persons or property or is otherwise serious and urgent; and (ii) the tenant has given the landlord notice of the state of disrepair or made a reasonable attempt to do so;
I consider the cost of the electrician was a reasonable expense. In this case, the lack of lights in the bathroom was serious and urgent because the tenant’s parents were elderly and there was a risk they could have fallen in the dark. The tenant sent the landlord a text giving the landlord notice of the disrepair shortly after the lights failed again and also sent an email the next day.
The Tribunal therefore orders the landlord to reimburse the tenant for the electrician’s fee.

Should the landlord reimburse the tenant for the HHS report cost?

The tenant commissioned her own HHS report only after the landlord did not provide her with a copy of a full HHS report, but only a certificate of compliance. The lack of a report containing showing that the certifier had methodically checked the premises was less than desirable because it did not demonstrate any rigour. 18 I would have come to the same conclusion under s 66 of the RTA.
By the time she requested the HHS information, the tenant was finding that the premises prone to mould and suspected that it did not comply with the HHS. The report she commissioned was thorough and professional and showed that the premises did not fully comply with the HHS.
Where, as in this case, a tenant is justifiably concerned that the premises do not comply with the HHS and that is proven to be the case, I consider the Tribunal may exercise its powers according to the substantial merits and justice of the case and order the landlord to reimburse the tenant for cost of the report. 19

Does the tenant owe rent arrears?

The landlord provided a rent summary which proved the tenant owes rent of $1,028.57 to the end of the tenancy.

Did the tenant leave the premises reasonably clean?

The landlord claims the tenant did not leave the premises reasonably clean.
The tenant had not received the landlord’s evidence prior to hearing so had not fully prepared for the claim by for example collating her own photographs. However, I found it appropriate to proceed with the claim. Legal principles
At the end of their tenancy, tenants must leave the premises reasonably clean and tidy and remove all rubbish. 20
Correspondingly, the landlord must provide the premises to the tenant in a reasonable state of cleanliness at the beginning of the tenancy. 21
“Reasonably clean” means clean to the standard of an average bystander. It does not mean spotless, immaculate, or commercially clean, hotel or motel standard. A landlord therefore may have some work to get the premises up to standard for a new tenant and cannot claim the cost of that to the tenant.
A tenant does not have to leave the premises cleaner and tidier than at the start of the tenancy. A claim for cleaning may be dismissed if there is no proof of the premises’ condition at the start of the tenancy. 22 19 RTA, s 85(2). 20 RTA, s 40(1)(e)(iii). 21 RTA, s 45(1)(a) of the RTA.
The onus for establishing the claim, sits with the person making it on the balance of probabilities. In this case, the landlord is seeking to recover cleaning costs. Therefore, the landlord must prove that the tenant did not leave the premises reasonably clean and tidy. Discussion
The premises was less than reasonably clean at the beginning of the tenancy. The tenant emailed the landlord on 16 February 2023 that the lack of cleanliness included:
Kitchen area with greasy drawers/handles...other surfaces...
Ceiling, skirting, window frames, windows...dusty and dirty...
Stained carpets...
...
Marks on walls...
However, the landlord’s photographs of the premises showed the premises was less clean at the end of the tenancy than at its beginning. The tenant accepted that she and her family had not cleaned all the mould off the windows. That was likely because they put the existence of the mould down to the fault of the premises.
The landlord also found that the carpets needed to be shampooed because of the tenant’s dog. Conclusion
I find it proven that the tenant did not leave the premises reasonably clean.
Taking account of the fact the premises were not reasonably clean at the beginning of the premises the Tribunal orders the tenant to pay 25 per cent of the landlord’s cleaning cost. The presence of the tenant’s dog necessitated a deodorant and further carpet cleaning which the tenant’s own carpet cleaning had not fully addressed. The Tribunal orders the tenant to reimburse the landlord for the deodorant and the carpet cleaning invoice. 22 Stewart Benson Residential Tenancy Law in New Zealand (Thomson Reuters, Wellington, 2018) at
12. Filing fee
The tenant has substantially succeeded in the proceedings. The Tribunal orders the landlord to reimburse the tenant for the filing fee. Non-publication
The parties sought non-publication of their identifying details.
The Tribunal must, on the application of a party that has wholly or substantially succeeded in proceedings, order that the party’s name or identifying particulars not be published, unless the Tribunal considers that publication is in the public interest or is justified because of the party’s conduct or any other circumstances of the case.
The tenant has substantially succeeded in the proceedings. I do not consider that publication is in the publication interest or is justified because of the tenant’s conduct or any other circumstances of the case.
The landlord was not substantially successful in the proceedings overall. An order for non-publication is refused.

Claims & awards

What this tenancy cost at tribunal — claim, category, amount, and party awarded, with reconciled net total.

Claims and awards in Tenancy Tribunal application 4627167. Amounts reconciled from the published order (claims sum and net total). Verify on MoJ.
Claim	Landlord	Tenant	Reason
Cleaning cost: 25	$175.00		Cleaning cost: 25
Carpet cleaning cost	$185.00		Carpet cleaning cost
Pet deodorant	$36.99		Pet deodorant
Rent arrears to 28/07/23	$1,028.57		68. Where, as in this case, a tenant is justifiably concerned that the premises do not comply with the HHS and that is proven to be the case, I consider the Tr…
Rent reduction: 10% between 17/2 - 28/7/2023		$2,082.86	Rent reduction: 10% between 17/2 - 28/7/2023
Reimbursement for cost of electrical repairs		$546.25	Reimbursement for cost of electrical repairs
Reimbursement of cost of HHS report		$149.00	Reimbursement of cost of HHS report
Filing fee reimbursement		$20.44	Filing fee reimbursement
Total award	$1,425.56	$2,798.55

Claims and awards for application 4627167. Verify on MoJ.

Cleaning cost: 25

Amount: $175.00
Awarded to: Landlord
Reason: Cleaning cost: 25

Carpet cleaning cost

Amount: $185.00
Awarded to: Landlord
Reason: Carpet cleaning cost

Pet deodorant

Amount: $36.99
Awarded to: Landlord
Reason: Pet deodorant

Rent arrears to 28/07/23

Amount: $1,028.57
Awarded to: Landlord
Reason: 68. Where, as in this case, a tenant is justifiably concerned that the premises do not comply with the HHS and that is proven to be the case, I consider the Tr…

Rent reduction: 10% between 17/2 - 28/7/2023

Amount: $2,082.86
Awarded to: Tenant
Reason

Claim types — money lines allowed on this order

Carpet Cleaning Cleanliness Filing Fee Property damage Rent arrears

Order

The tenant’s name and identifying details must not be published.
The bond is to be refunded to the tenant immediately.
The May Limited must immediately pay [the tenant] $1,372.99 as calculated in the table below.

Reasons

The tenant attended the hearing with a support person.
Fiona Feng and Selina Yu attended for the landlord. Ms Feng managed the tenancy and is closely connected with it. Ms Yu is an experienced property manager who has regularly appeared before the Tribunal. She joined the May Limited recently.
Cyril Young, a Mandarin interpreter, attended for Ms Feng. 2
The tenant claims the landlord failed to maintain the premises, did not comply with the Healthy Homes Standards (HHS), and seeks an order for the early end of the fixed term. She seeks compensation as the remedy for the breaches, and reimbursement for the cost of an electrical contractor, and a HHS report.
The landlord claims for rent arrears and compensation for the cost of cleaning the premises after the tenancy ended. Background
The tenant and her elderly parents moved into premises because the tenant’s home was damaged by flooding. The tenancy was to be for a short term while the tenant’s own home was repaired. The tenancy agreement was for fixed term beginning 17 February 2023 and ending on 31 December 2023.
The premises themselves were the larger part of a circa 1940s’ concrete Art Deco house. A smaller part of the house was not part of the tenancy and was sectioned off. The landlord’s text dated 9 February 2023 confirmed: Given that you are a family, rent the 4 rooms seen today for a discounted rate of $900 per week...
At the case’s last call, the Tribunal raised an issue as to the premises’ legality: 3
As several of the issues relate to what appears to be a division of one house into two or more tenancies (for example the alleged dangerous wiring, the power issues, and the gas bottle usage), I expect the landlord to file evidence regarding the consents obtained and legality of the conversion.
At hearing the landlord maintained that the house was not divided into two tenancies. However, the tenant says she is sure that other tenants lived in the other part of the house. 1 This is a reserved decision. I heard the matter on 1 March 2024. 2 Mr Young kindly came to court at short notice because a Mandarin interpreter had not been booked in advance of the hearing. 3 Paragraph 7 of Adjudicator M Allan’s directions dated 6 September 2023.
During the tenancy, tenant complained to the landlord about maintenance issues, including a faulty stove element, the electrical wiring, and the toilet. The parties disagree on whether the landlord adequately responded to the tenant’s complaints.
The tenant left the tenancy before the end of the fixed term. She applied to the Tribunal on 10 July 2023 for formal order to end the tenancy early. However, the tenant and her parents decided they could not wait for a Tribunal hearing. On 24 July 2023, the tenant emailed the landlord: I am writing to inform May Property of my decision to terminate the fixed-term tenancy... ...I am now facing significant health and safety concerns due to unresolved repairs that have persistently neglected for the past five months. These concerns have reached a critical point, impacting the well-being of both myself and my elderly parents. Regrettably, I can no longer continue to reside in the property under these circumstances. ...The house will be vacant from the 28 th of July onwards.
The landlord disputes that there is a proper basis for ending the tenancy early.
The issues that arise for determination are: a. Did the landlord fail to maintain the premises? b. Did the landlord fail to comply with the HHS? c. Was the premises an unlawful premises? d. Should a rent reduction be ordered? e. Should the term of the fixed-term tenancy be reduced? f.Should the landlord be ordered to reimburse the tenant for the costs of the electrician and the HHS report? g. What does the tenant owe for unpaid rent? h. Should the tenant reimburse the landlord for cleaning costs?

Did the landlord fail to maintain the premises?

Under s 45(1)(b) of the Residential Tenancies Act 1969 (RTA), landlords must maintain the premises in a reasonable state of repair. That provision provides: 45 Landlord’s responsibilities (1) The landlord shall— (a) ... (b) provide and maintain the premises in a reasonable state of repair having regard to the age and character of the premises and the period during which the premises are likely to remain habitable and available for residential purposes...
Compensation is available if a breach is proven. However, exemplary damages are not available because the tenant did not apply for exemplary damages prior to the hearing. 4
Landlords are liable for defects that they have knowledge of. They must repair defects within a reasonable time once they acquire such knowledge. As the author of Residential Tenancy Law in New Zealand explains: 5 The landlord’s obligation of repair is not absolute. A landlord does not have to foresee a latent and unobservable defect before it causes damage... A landlord therefore must repair within a reasonable time after knowledge of the need for repair: 6 “...the obligation of the landlord, under s 45, is to investigate and repair a defect brought to its attention within a timeframe which is reasonable in the circumstances and as to what that time is, I think, depends not only on the gravity of the problem but also on the objective evidence of the attempts made by the landlord to investigate, and put right, whatever the problem might be...”
Landlords also have an obligation to repair things that are apparent from observation: 7 However, notice from the tenant is not needed if the landlords knew of the need for repair or the need for repair is apparent from observation...
On 28 February 2023, the tenant emailed the landlord complaining of maintenance issues, including: a. One stove element not working. b. Bedroom light could not be turned off. c. Backflow leak and smell problem with the toilet. 4 Residential Tenancies Act 1986 (RTA) s 45(1A) and Schedule 1A. Exemplary damages of up to $7,200 may be awarded.. 5 Stewart Benson Residential Tenancy Law in New Zealand (2018) Thomson Reuters at 6.18. 6 Collins v Professionals Hutt City Ltd DC Wellington CIV 2009-085-1431, 24 February 2010 at [15]. 7 See n 5. Stove
On 10 April 2023, the tenant emailed the landlord about the stove again: One of the heating plates don’t work, this has been raised since day 1. Please advise when will this be fixed.
The landlord provided the tenant with a portable plug-in stove rather than repairing the faulty element. Ms Feng said that tenant’s mother who did most of the family’s cooking was happy with the solution.
The tenant says the landlord should have spoken to her, not her mother. She maintains the family were not happy with the get-around solution. The tenant’s 14-day notice dated 23 April 2023 stated that eight weeks after the issues had been reported, the landlord had not fixed either the stove element or the toilet. Toilet
On 3 March 2023, the landlord responded that the toilet smell issue was likely due to the tenant’s dog.
The tenant says the toilet was never fixed. The landlord maintains that the toilet was in good working order and refers to a “Plumbing Inspection Report” dated 31 March 2023, that records in summary: All plumbing in the bathroom is in proper working order with no leaks, blockages, and normal flushing. There are no abnormal noises during use, and overall condition of the bathroom is good for regular use.
The tenant played an audio recording taken on her cell phone of the sound the toilet made. The recorded noise sounded loud and unpleasant.
The landlord maintains its property manager never heard the sound and its contractor confirmed the toilet was in good working order. Electrical wiring
On 3 and 5 April, the tenant reported that the laundry light was not working.
On 12 April 2023, the tenant emailed the landlord that the lights for the side of the house where the toilet and bathroom were located were not working: Fuse has popped in the main switch board and when switching back on it won’t stay. We need this urgently fixed as is very dangerous to use toilet/shower with no light at all.
The landlord responded at 12:09pm the next day to arrange a repair.
On 23 April 2023, in her email accompanying the 14-day notice for the tenant also stated that “Light in laundry does not work, (hasn’t worked since start of the tenancy)”.
The landlord maintains that the necessary repairs were done within the 14-day period despite their contractor having to return several times because the tenant’s dog, which had a “guard dog” tendencies was not removed from the house when they attended.
At about 7:31pm on 8 May 2023, the tenant texted the landlord: Urgent – bathroom power went out again tonight, fuse tripped off. Please repair asap as it is dangerous shower in the dark.
At 4:44pm the next day the tenant having not heard from the landlord, emailed: I contacted you on the emergency contract number...no one has replied it has been 24hours without response from landlord. It is an urgent matter as I explained, we cannot see anything in shower/toilet it’s completely dark and it is slippery and dangerous, people will fall over/injur. I have now phoned an electrician to attend the problem asap and will sent you the invoice.
The tenant then sent through her electrician’s receipt for $546.25 at 5:23pm that day.
The landlord says that they never received the tenant’s text. Ms Feng highlighted the tenant’s contractor’s invoice was forwarded less than an hour after the tenant’s 4:44pm email. The landlord did not approve of the repair and replied, “Therefore, we refuse to pay this so-called bill.”
The tenant’s electrician’s invoice dated 22 May 2023 recorded that the “Circuit breaker kept tripping at random moments (Lighting circuit)”. The contractor located a fault, carried out a repair, and found no fault afterwards. However, the tenant says the contractor told her they found illegal wiring that they could not fix. A later email from the electrician’s company states: Based on our electrician’s notes, there were 2 households on the property with cross-wiring between them. Unfortunately, we were not able to access this property to investigate.
The landlord accepts that wiring was old as it had been wired a long time ago. It commissioned its own electrician’s report dated 15 May 2023 that found in respect to the bathroom: Following a thorough examination, all electrical components in the bathroom demonstrate proper functionality, with no signs of malfunctions or potential hazards. Discussion
The landlord did not fix the defective stove element. To the tenant’s annoyance, the property manager was more comfortable communicating with the tenant’s mother in Mandarin, and her mother was content with using a plug-in stove top. However, the tenant repeatedly asked for the element to be repaired. The tenant’s mother was not a tenant, so did not have the power to agree to the element not being repaired. The landlord never repaired the element so there was a low-level breach by the landlord of its obligations.
I do not find it proven on the balance of probabilities that the toilet was malfunctioning. The tenant did not produce evidence from a contractor to rebut the landlord’s contractor’s evidence that the toilet was in good working order.
The tenant complained about mould. However, it was not proven there was anything defective in the house that contributed to the mould.
The tenant complained of being without hot water for a week. That was due to a gas bottle not being refilled. It was not proven that the landlord breached any duty in that regard.
I accept the tenant’s evidence that the wiring circuit serving the bathroom’s lights repeatedly failed. The tenant’s electrician found a fault in the redundant bathroom light switch. The laundry light did not work. While the landlord’s electrical person found the bathroom’s electricals satisfactory, I consider that it is more likely than not that the premises’ wiring was overall not in a reasonable standard of repair. The wiring was old by the landlord’s own admission. I consider it probable that it was obsolete for modern living, was getting worn, and therefore the bathroom circuit regularly failed. The wiring’s obsolescence was exacerbated by (as will be discussed below) another household sharing the house’s old and outdated wiring. Conclusion
I am satisfied that the landlord did not provide and maintain the premises in a reasonable state of repair in respect to the stove element and the electrical wiring.
The tenant has not sought exemplary damages. They are therefore not available.
The issue of compensation will be discussed below in respect to the issue of whether the premises is an unlawful premises and whether a rent reduction should be ordered.

Did the landlord comply with the HHS?

Under s 45(1)(bb) of the RTA, landlords must comply with the HHS which require the premises to be insulated, draught free, ventilated, and protected from water ingress.
The tenant provided a Healthy Homes Standards Report dated 27 July 2023 which found the premises failed to meet the water ingress and the draught standards in that: a. A section of guttering was damaged. b. There were a few gaps around the windows.
The landlord submitted a HHS certificate confirming that the premises complied with the HHS.
The tenant’s HHS report was comprehensive and well set out. The landlord’s HHS was not supported by a report.
It is possible the premises met the HHS at the time the landlord’s contractor provided a report. I do not find it proven otherwise.
However, I accept the tenant’s HHS report’s findings. I am satisfied that the premises did not meet the drainage and ventilation standards at the date the assessment was done on 27 July 2023 due to the damaged guttering and excessive window gaps.
The tenant did not formally seek exemplary damages prior to hearing, so exemplary damages are not an available remedy at this time.
The issue of compensation for loss of amenity and for the cost of the report will be discussed below in the context of whether a rent reduction should be ordered for the premises being unlawful.

Was the premises an unlawful premises?

Legal principles

The Tribunal may declare premises to be unlawful residential premises under s 77(2)(ac) of the Residential Tenancies Act 1986 (RTA).
Under s 78A(2) of the RTA, 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: a. s 36 of the RTA (take all reasonable steps to ensure that, at the commencement of the tenancy, there is no legal impediment to the occupation of the premises for residential purposes); or b. s 45(1)(c) of the RTA (comply with all requirements in respect of buildings).
Where the Tribunal declares the residential premises to be unlawful, it 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: s 78A(4)(a) of the RTA.
Relevantly for this case, household units may not be divided into smaller household units without fulfilling change of use rules which involve Council issuing a Certificate of Code Compliance. Section 115(1) of the Building Act 2004, provides: 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... Discussion
The parties’ written communications refer to other tenants being next door. On 6 July 2023 for example, the tenant emailed the landlord: My mother advised me that May rang her personally to accuse her for not changing gas bottle which caused next door tenants no hot water to use. These gas bottles are shared between two tenancies of yours...
The tenant was adamant that people were living in the portion of the house that the tenant and her parents were not living in. She saw the tenants in passing, they parked their cars outside and she could hear them inside the other unit. She did not go into the other unit, but the same tenants were there month after month, not just for a few days or week.
In its earlier decision, the Tribunal directed the landlord to provide evidence about the legality of the conversion of the household unit. The landlord provided no evidence because it says there was only one household unit: the unit the tenant occupied.
The plan of the premises attached to the tenancy agreement shows that the smaller separated-off part of the house contained rooms named: study room, entrance hall, porch, master bedroom. There is also an unnamed room which depicts a bathroom with a bath, toilet, and washing machine.
The landlord maintains that the other part of the house was used only to store the owner’s furniture, and nobody lived there. Ms Feng says some of the owner’s employees used the adjacent sleepout, which was not attached to the premises. The tenant must have seen the sleepout’s occupants and mistakenly thought they were living next door.
I prefer the tenant’s evidence on this matter. The tenant does not lack any of her faculties. She can see and hear. My impression from her interactions with the Tribunal is that she is intelligent and observant. It is not probable that she would be mistaken about what she saw and heard to such a significant extent that she would mistakenly believe the landlord’s tenants were living next door when they were actually living in the sleep out. There is no comment in any of the communications to suggest that the other tenants did not live immediately next door.
The plan of the smaller part of the house is about 40m 2 and easily large enough to be used as a living area. The plan does not contain an area described as a kitchen, but occupants could simple cooking appliances such as a microwave or hot plate or installed a basic kitchen.
It is not probable that the tenant erroneously believed people were living in the other part of the house or that the landlord was unaware that her tenants were living there. Conclusion
I am satisfied on the balance of probabilities that the other part of the house was occupied by other tenants of the landlord as a separate residential unit.
Accordingly, 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.
For these reasons, the premises were unlawful under s 78A(2) of the RTA.
The Tribunal will declare that the apartment was unlawful premises.
I must now consider whether the Tribunal should order the landlord to repay any of the rent.

Rent repayment?

What factors should be considered in quantifying a rent reduction?

Where it finds premises are unlawful residential premises under s 78A(4) of the RTA, the Tribunal may order the landlord to (i) repay the tenant all the rent they paid; or (ii) 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.
Section 78A(4)(ii) should be applied to this case because repayment of the all the rent would not be proportionate the circumstances here.
I must carefully weigh what amount of rent it is fair for the landlord to repay considering the nature of the premises and the other circumstances of the case.
The other “special circumstances of the case” the Tribunal must have regard to are not stated. It is left to the Tribunal to determine what the other special circumstances might be.
A useful starting point is to consider the factors suggested by Janet Robertshawe 8 in her paper addressing this issue after s 78A’s introduction to the RTA. She suggested the following factors as relevant “circumstances of the case”: 9 a. The landlord’s knowledge and motivation for renting the property, and their conduct during the tenancy. b. The tenants’ knowledge and motivation for renting the property and bringing the claim, and the length of time they lived in the property. c. The benefits the landlord received in renting the property. d. The benefits the tenant received in renting the property. e. The seriousness of the regulatory breaches making the premises unlawful and any other breaches. f.Any detriment or loss the tenants suffered. g. The purpose of s 78A in ensuring landlords do not unfairly profit from unlawful premises. 10 8 Janet Robertshawe was then a highly experienced tenancy adjudicator. She is currently the Principal Disputes Referee. 9 See Janet Robertshawe’s 2019 conference paper, “The Legacy of Anderson v FM Custodians: Section 78A Tenancies”. Applied for example in AD v Gao [2021] NZTT North Shore 4260212 and Tenant v Kranenburg [2021] NZTT 4298196, 4294929. 10 Anderson v FM Custodians Ltd [2013] NZHC 2423. h. The public interest in discouraging tenancies of unlawful premises. i.Whether exemplary damages or compensation is ordered for other related breaches. j.Any other relevant matter. 11 The nature of the premises
The house is in a generally acceptable condition commensurate to its age. The house’s wiring needs work.
The house was not fully compliant with the HHS at least towards the end of the tenancy, but the deficits were of a lower order.
Sectioning off part of the house would not have impacted greatly on the amenity in the larger par of the house, although it may have compromised the ability to ventilate the premises. The seriousness of the breach
The Court of Appeal in Parbhu 12 disparaged a sledgehammer response of a full rent reduction in response to “relatively footling” breaches: The effect of relying on that provision is that any relatively footling breach by a landlord (for instance, the incomplete planning or building consenting of an otherwise eminently safe and sound accessory unit)...would compel total restitution of rent paid regardless of the degree of benefit.
Consistently with these comments in Parbhu, any rent repayment the Tribunal orders should be proportionate to the seriousness of the breach. At the least serious end of the scale where there is a minor building consent irregularity, but the premises are “eminently safe and sound” a full rent reduction is not called for. 11 See n 9: “The opening words to s78(4) state that it does not limit the generality of s77, or the nature or extent of the orders that the Tribunal can make in relation to the matter. However, it is submitted that the framework in (4) should be used when it applies, and to calculate a deduction (if any) from the starting point of all rent paid rather than building up individual breaches without reference to that benchmark.” 12 Want v Parbhu & Patel as Trustees of the Impala Trust [2019] NZCA 674 at [31].
In Chen v Kumar 13 the premises had been consented for use as a rest home (upstairs) and a residence for the past owner and family (downstairs). Originally, the rest home and residence were not physically divided but some years before the tenancy, someone had built-out access between the upstairs and downstairs to create two separate residential units. The landlord, Mr Chen, was convinced that he could lawfully rent the downstairs premises out. The Tribunal found however, the premises were unlawful and ordered about 70 per cent of the rent be returned to the tenant, which amounted to $45,000.00.
In the District Court, Judge DJ Clark agreed with the Tribunal that the premises were unlawful. However, he considered that on the facts as he found them, the rent reduction must be drastically reduced. Importantly for his decision, Mr Kumar very much wanted to stay in the premises and the premises were not “unsafe”: [95] Furthermore, Mr Kumar and his family enjoyed the occupancy of a premises and received the full benefit of those premises throughout the course of the tenancy. He wanted the tenancy to continue. I do not accept then the unit is necessarily “unsafe” given Mr Kumar’s enjoyment of the same. Arguably it falls into the category contemplated by the Court of Appeal as being technically in breach of planning or consenting obligations but otherwise could be safe. Certainly, until February 2021 Mr Kumar thought so as he wanted to remain there. [96] The Tribunal ordered Anemax (and now the landlord through my order) to pay Mr Kumar the sum of $45,000 (being a 30% reduction on the total rent paid). For the reasons set out I quash that order given that I find Mr Kumar had the full benefit of the premises during the tenancy, which including a discount during the period of construction.
His Honour reduced the rent to be refunded to $2,000.00. That amount also took account of rent arrears of $3,165.71 (which the Tribunal had also declined to order). The District Court rent reduction of $2,000.00 amounts to about 3 per cent of the total rent paid. 14 If the $3,165.71 arrears are factored in the reduction is about 7.5 percent. 15
In Kemp v Elliot 16 the premises’ passed its final inspection which found the build to have been completed in accordance with the building consent. The final inspection report recorded that Council should issue the CCC upon the landlord paying the appropriate application fee. 13 Chen v Kumar [2022] NZDC 7783. 14 The rent due to 9 March was $66,874.29. 15 The rent due to the end of the tenancy was $68,445.71. 16 [2022] NZDC 17792.
Kemp is an exemplar of “the incomplete planning or building consenting of an otherwise eminently safe and sound accessory unit”.
The Tribunal had ordered 30 per cent rent reduction (based on findings of fact that the District Court did not adopt), which resulted in a refund rounded up to $20,000.00. 17 However, Judge D J Clark quashed the Tribunal’s order and substituted an order for a rent reduction of $2,000.00. That figure amounts to a rent refund of about 3 per cent.
The facts in this case differ from the District Court cases. In Kumar only a technical breach was proven, the tenants very much enjoyed the premises and were desperate to stay. In Kemp the premises had passed a final inspection and only a fee had to be paid for the CCC to be issued.
In this case, there were more than technical barriers to obtaining a CCC. For example, firewalls between the two premises, and separate up-to-Code wiring would have been required. The landlord’s knowledge of the breach and motivation for renting, and conduct
The landlord knew that the other part of the premises was occupied. It likely considered there was no harm that would come from letting out part of the house separately.
The property manager and the tenant fell out over a variety of things including the tenant’s dog and whether repairs were properly done. Overall, the landlord met its maintenance obligations. The wiring was the most concerning problem. The existence of two dwellings sharing the same electricity exacerbated the substandard wiring and probably contributed to the premises’ bathroom lights regularly failing. The tenant’s knowledge and motivation
The tenant was motivated to, at short notice, find a safe, pleasant, and affordable place to live while her own home was repaired. She did not know the premises were not lawful. The Tribunal detected that as an issue after the tenant brought her claim before it. 17 The total rent due to the end of the tenancy was $63,607.14. The benefits the parties received
The tenant benefited from having a reasonable place to stay. The landlord received rent. Any detriment to the tenants
The tenant suffered some loss of expected amenity in the premises due to the poor electrical failures and the draught among other things of a lower order. Unfair profit and the public interest
Section 78A addresses a concern that landlords do not unfairly profit from unlawful premises and there is a public interest in discouraging tenancies of unlawful premises.
These factors call for the rent reduction to be set at a level that deters and landlords from running the risk of renting out unlawful premises by depriving them of any unfair rental profit. Other related orders made in the case
In this case, the Tribunal will not make any other order for compensation or exemplary damages.
The Tribunal could make compensation orders under s 45(1)(b), and (bb) of the RTA. However, I consider that s 78A can do the work in this case. A further order for compensation for a breach of s 45 would be double-counting. Conclusion
Weighing these factors, I find special circumstances to award less than a full rent reduction.
I consider a 10 per cent reduction of the rent paid is an appropriate amount to order.
It follows, the Tribunal orders the landlord to reimburse the tenant $2,082.86.

Should the fixed term of the tenancy be reduced?

The premises were unlawful residential premises. They should not have been rented out. The unlawful situation contributed to the premises’ electrical wiring problem and made the premises less safe than they should have been because there should have been for example a firewall between the two premises.
In the circumstances, I consider the tenancy should be reduced to the date the tenant moved out: 28 July 2023. 18 Should the landlord reimburse the electrician’s costs?
Under s 45(1)(d) of the RTA, landlords must compensate the tenant for reasonable expenses they have incurred to repair the premises. The paragraph provides that the landlord “shall”: (d) compensate the tenant for any reasonable expenses incurred by the tenant in repairing the premises where— (i) the state of disrepair has arisen otherwise than as a result of a breach of the tenancy agreement by the tenant and is likely to cause injury to persons or property or is otherwise serious and urgent; and (ii) the tenant has given the landlord notice of the state of disrepair or made a reasonable attempt to do so;
I consider the cost of the electrician was a reasonable expense. In this case, the lack of lights in the bathroom was serious and urgent because the tenant’s parents were elderly and there was a risk they could have fallen in the dark. The tenant sent the landlord a text giving the landlord notice of the disrepair shortly after the lights failed again and also sent an email the next day.
The Tribunal therefore orders the landlord to reimburse the tenant for the electrician’s fee.

Should the landlord reimburse the tenant for the HHS report cost?

The tenant commissioned her own HHS report only after the landlord did not provide her with a copy of a full HHS report, but only a certificate of compliance. The lack of a report containing showing that the certifier had methodically checked the premises was less than desirable because it did not demonstrate any rigour. 18 I would have come to the same conclusion under s 66 of the RTA.
By the time she requested the HHS information, the tenant was finding that the premises prone to mould and suspected that it did not comply with the HHS. The report she commissioned was thorough and professional and showed that the premises did not fully comply with the HHS.
Where, as in this case, a tenant is justifiably concerned that the premises do not comply with the HHS and that is proven to be the case, I consider the Tribunal may exercise its powers according to the substantial merits and justice of the case and order the landlord to reimburse the tenant for cost of the report. 19

Does the tenant owe rent arrears?

The landlord provided a rent summary which proved the tenant owes rent of $1,028.57 to the end of the tenancy.

Did the tenant leave the premises reasonably clean?

The landlord claims the tenant did not leave the premises reasonably clean.
The tenant had not received the landlord’s evidence prior to hearing so had not fully prepared for the claim by for example collating her own photographs. However, I found it appropriate to proceed with the claim. Legal principles
At the end of their tenancy, tenants must leave the premises reasonably clean and tidy and remove all rubbish. 20
Correspondingly, the landlord must provide the premises to the tenant in a reasonable state of cleanliness at the beginning of the tenancy. 21
“Reasonably clean” means clean to the standard of an average bystander. It does not mean spotless, immaculate, or commercially clean, hotel or motel standard. A landlord therefore may have some work to get the premises up to standard for a new tenant and cannot claim the cost of that to the tenant.
A tenant does not have to leave the premises cleaner and tidier than at the start of the tenancy. A claim for cleaning may be dismissed if there is no proof of the premises’ condition at the start of the tenancy. 22 19 RTA, s 85(2). 20 RTA, s 40(1)(e)(iii). 21 RTA, s 45(1)(a) of the RTA.
The onus for establishing the claim, sits with the person making it on the balance of probabilities. In this case, the landlord is seeking to recover cleaning costs. Therefore, the landlord must prove that the tenant did not leave the premises reasonably clean and tidy. Discussion
The premises was less than reasonably clean at the beginning of the tenancy. The tenant emailed the landlord on 16 February 2023 that the lack of cleanliness included:
Kitchen area with greasy drawers/handles...other surfaces...
Ceiling, skirting, window frames, windows...dusty and dirty...
Stained carpets...
...
Marks on walls...
However, the landlord’s photographs of the premises showed the premises was less clean at the end of the tenancy than at its beginning. The tenant accepted that she and her family had not cleaned all the mould off the windows. That was likely because they put the existence of the mould down to the fault of the premises.
The landlord also found that the carpets needed to be shampooed because of the tenant’s dog. Conclusion
I find it proven that the tenant did not leave the premises reasonably clean.
Taking account of the fact the premises were not reasonably clean at the beginning of the premises the Tribunal orders the tenant to pay 25 per cent of the landlord’s cleaning cost. The presence of the tenant’s dog necessitated a deodorant and further carpet cleaning which the tenant’s own carpet cleaning had not fully addressed. The Tribunal orders the tenant to reimburse the landlord for the deodorant and the carpet cleaning invoice. 22 Stewart Benson Residential Tenancy Law in New Zealand (Thomson Reuters, Wellington, 2018) at
12. Filing fee
The tenant has substantially succeeded in the proceedings. The Tribunal orders the landlord to reimburse the tenant for the filing fee. Non-publication
The parties sought non-publication of their identifying details.
The Tribunal must, on the application of a party that has wholly or substantially succeeded in proceedings, order that the party’s name or identifying particulars not be published, unless the Tribunal considers that publication is in the public interest or is justified because of the party’s conduct or any other circumstances of the case.
The tenant has substantially succeeded in the proceedings. I do not consider that publication is in the publication interest or is justified because of the tenant’s conduct or any other circumstances of the case.
The landlord was not substantially successful in the proceedings overall. An order for non-publication is refused.

Tenancy Tribunal case 4627167 — Rent arrears at 886 Mount Eden Road, Three Kings, Auckland 1024

At a glance

Tenancy Tribunal case 4627167 — Rent arrears at 886 Mount Eden Road, Three Kings, Auckland 1024

At a glance

Claims & awards

Order

Reasons

Did the landlord fail to maintain the premises?

Did the landlord comply with the HHS?

Was the premises an unlawful premises?

Rent repayment?

What factors should be considered in quantifying a rent reduction?

Should the fixed term of the tenancy be reduced?

Should the landlord reimburse the tenant for the HHS report cost?

Does the tenant owe rent arrears?

Did the tenant leave the premises reasonably clean?

Topics & place

Residential Tenancies Act sections

Key findings

Frequently asked questions

Claims & awards

Order

Reasons

Did the landlord fail to maintain the premises?

Did the landlord comply with the HHS?

Was the premises an unlawful premises?

Rent repayment?

What factors should be considered in quantifying a rent reduction?

Should the fixed term of the tenancy be reduced?

Should the landlord reimburse the tenant for the HHS report cost?

Does the tenant owe rent arrears?

Did the tenant leave the premises reasonably clean?

Topics & place

Residential Tenancies Act sections

Key findings

Frequently asked questions