Published tribunal order
Tenancy Tribunal case 4635291 — Property damage at 33 Puketea Street, Auckland, Blockhouse Bay, Auckland
Decided 14 Oct 2023 · Published 14 Oct 2023 · Application 4635291
Mixed / unclear
- Property damage
- Exemplary damages
Order
- Just Prestige Properties Limited as agent for Dan Chen must pay Paula Naomi Ora Ioapo and Andrew Pouniu Ioapo $1,396.44 immediately, calculated as shown in table below.
- The landlord must carry out the following work to the premises, which must be completed by 1 December 2023: a. Repair wall damage in the hallway and laundry to a reasonable standard of repair. b. Reinstate the laundry tub or similar and washing machine attachments to a reasonable standard of repair.
- As an alternative to compliance with Order 2, the landlord must pay the tenants $4,000.00 immediately.
- If the landlord fails to comply with either Order 2 or 3 above, then the tenants may undertake the work and charge the landlord the costs of this work up to $5,000.00. These costs may be set off against rent payable.
- The rent shall abate by $47.00 per week commencing 12 October 2023 and continuing until Order 2 is fully complied with.
Reasons
- Paula Iaopo attended the hearing for the tenants.
- Mark Liu attended for the Just Prestige Properties Limited.
- The tenants apply for work orders, compensation, exemplary, and reimbursement of the filing fee. Background
- The tenancy began on 14 December 2020 and is continuing.
- On 12 October 2022 – the day before a routine inspection - the tenants reported three separate instances of wall damage being: a. A mouse hole sized hall, caused by the tenants’ daughter’s high heeled shoe. b. A foot sized hole caused by the tenants’ daughter attempting to climb the wall. c. A body sized depression on the hallway side of the laundry wall that occurred when the tenants’ children pushed each other into the wall, but the reason the wall got pressed in was because it was weakened by water ingress.
- The landlord’s agent told the tenants were liable for the damage and to repair it.
- The tenants initially accepted responsibility for repairing the wall damage. However, they now consider they are not responsible for the damage to the laundry wall because the leak from their washing machine was not because of carelessness and their repairer has found evidence that the wall has been suffering from water ingress well before their washing machine leaked.
- On the day of the inspection, 13 October 2022, the tenants also reported to the landlord that two lights in the living room, one light in the kitchen and two light covers in a bedroom needed repair or replacement. The tenants were particularly concerned about the lights in the bedroom because live wires were left exposed.
- The lights were repaired on 19 July 2023, more than nine months after the tenants first reported the problem.
- Because of the landlord’s agent’s direction, the tenant got her own handyman friend to carry out the wall repairs. He was initially prepared to do the work for the cost of materials, but the laundry wall damage has proved much greater than was anticipated because he discovered damage which must have occurred due to water ingress into the wall over many years, not just from the tenants’ washing machine/ .
- The tenant has not been able to use her washing machine since 21 July 2023 because to repair the wall her handyman had to remove the laundry tub which the washing machine connects to. It was then her handyman discovered that the tub did not have a splashback and water had been leaking from where the splashback should have been. Issues for determination
- The issues for determination are: a. Did the landlord fail to maintain the premises in a reasonable state of repair? b. If so, should compensation or exemplary damages be awarded? c. What amount, if any, should the tenants contribute to the cost of the damage. Did the landlords fail to maintain the premises in a reasonable state of repair Legal principles
- 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...
- Breaching this obligation is an unlawful act for which exemplary damages may be awarded up to a maximum of $7,200.00: s 45(1A) and Schedule 1A of the RTA. 15. 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: 1 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: 2 “...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: 3 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...
When are tenants responsible for the damage to the premises?
- If the premises are damaged during the tenancy, to avoid liability, the tenants must prove they did not carelessly or intentionally cause or permit the damage. Tenants are liable for the actions of people at the premises with their permission. 4
- Where the damage is caused carelessly, and is covered by the landlord's insurance, the tenant's liability is limited to the lesser of the insurance excess or four weeks' rent. 5 1 Stewart Benson Residential Tenancy Law in New Zealand (2018) Thomson Reuters at 6.18. 2 Collins v Professionals Hutt City Ltd DC Wellington CIV 2009-085-1431, 24 February 2010 at [15]. 3 See n 1. 4 RTA, ss 40(2)(a), 41. 5 RTA, s 49B(3)(a).
- Where the damage is careless and is not covered by the landlord's insurance, the tenant's liability is limited to four weeks' rent (or market rent). Where insurance money is irrecoverable because of the tenant's conduct, the property is treated as if it is not insured against the damage. 6
- Tenants are liable for the cost of repairing damage that is intentional or which results from any activity at the premises that is an imprisonable offence. This applies to anything the tenant does and anything done by a person they are responsible for.
- Damage is intentional where a person intends to cause damage and takes the necessary steps to achieve that purpose. Damage is also intentional where a person does something, or allows a situation to continue, knowing that damage is a certainty. See Guo v Korck [2019] NZHC 1541. Wall damage
- The landlord’s agent took the view that the tenant was liable for the damage to the walls. That was understandable given that the tenant told the landlord’s agent that her children’s boisterous led to the holes in the walls, and her washing machine was leaking into the wall that had been pressed in.
- The tenant was liable for the two holes because they were caused by the tenant’s children’s carelessness. However, I am satisfied on the balance of probabilities that the tenant was not careless in respect to the washing machine leak because the leak was not readily perceptible with ordinary prudent use of the washing machine and laundry. 7 The leak was from a part of the washing machine hose behind the tub’s cabinet. The tenant stored toilet tissue in the cabinet, but it remained dry. There was no obvious sign of leaking. It was only after the laundry wall got pushed in by minimal force that the tenant discovered that dampness had weakened the wall.
- As soon as the leak was found, the tenant had it repaired. Later, her handyman found that there had been water ingress prior to the tenant’s washing machine leaking.
- The landlord’s agent got the tenant to get the wall damage fixed on the basis that she was liable for the damage. However, she was actually only liable for the two holes, not the more serious problem of the depression to the water- damaged wall. 6 RTA, s 49B. 7 See for example, Falwasser v Armstrong [2011] NZTT Whakatane 523.
- Moreover, it was not the tenant’s obligation to maintain and repair the premises, it is the landlord’s. The tenant should not carelessly damage the premises, but if they do, it is still the landlord’s obligation to repair the premises to a reasonable standard of repair. If the damage was caused deliberately or carelessly, the tenant is then liable to the landlord for the cost of repair within the limitations set by the RTA.
- The wall damage has still not been fully repaired. The tenant still cannot use her washing machine. The family have to use a laundromat which costs them time and money that they would not otherwise have to spend.
- It is open to a landlord and a tenant to agree on how tenant-caused damage might be repaired, but the obligation to repair should not be foisted on the tenant without their full knowledge that the obligation to repair is the landlord’s. 8 In this case, it probably would not have been unfair for the tenant to agree to repair the holes, if she agreed to that in full knowledge that it was not her responsibility to undertake the repair (as opposed to pay for it up to four weeks’ rent equivalent). She was liable for those and fixing them would not be complicated. However, the tenant was not liable for the water ingress damage, so it would not be fair for her to bear the responsibility of that repair even if she had full knowledge of the parties’ respectively obligations.
- The damage was reported a year ago and has still not been repaired. The landlord’s agent should have taken carriage of the repairs rather than leaving them to the tenant. The result has been that the premises have not been maintained in a reasonable standard of repair in breach of s 45(1)(b). Broken lights
- The tenant reported the problem with the lights on 13 October 2022. They were not fixed until 19 July 2023. The tenant’s partner tried to replace the lights in one of the bedrooms, but they broke through no fault of his. The other three lights simply ceased working. The problem with the lights was simply fair wear and tear. Conclusion
- The tenants have proved on the balance of probabilities that the landlord failed to maintain the premises to a reasonable standard of repair.
- The Tribunal must now consider what remedies should follow. 8 RTA, s 45(1)(b).
What remedies should be ordered?
Compensation
- The lack of working lights caused the tenant loss of amenity at the lower end of the scale. I calculate the loss of amenity at one per cent of the weekly rent.
- The holes in the hallway walls and the dent, mould, and damp in the laundry walls also impacted the tenant’s amenity. I also calculate that loss of amenity at one per cent of the weekly rent.
- The lack of a washing machine has put the tenant to significant cost and inconvenience. I calculate that at $40.00 per week. Exemplary damages
- Exemplary damages may be ordered where a landlord asks the tenant to carry out work in excess of their liability. 9 A landlord cannot demand or accept payment of an amount that exceeds the tenant's liability. Breaching this obligation is an unlawful act for which the Tribunal may award exemplary damages up to a maximum of $1,800.00.
- The landlord’s agent did ask the tenant to do repair work that exceeded her liability in this case, but I find the landlord did not do so intentionally because the agent had mistakenly thought the tenant was liable up to the value of the landlord’s insurance excess at the time and did not anticipate the repairs would cost more than the excess. That was a fact-based mistake not a mistake as to the law.
- Exemplary damages may also be ordered where the landlord fails to maintain the premises to a reasonable standard. I have found that the landlord did fail to maintain the premises to a reasonable standard.
- If the landlord committed this 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. 10
- I find that the failure to maintain was intentional. The landlord’s agent misapplied the law and mistakenly thought that it was the tenant’s obligation to repair the wall damage. Mistake of the law is not a defence, however. 9 RTA, s 49D. 10 RTA, s 109(3).
- I consider that the landlord’s agent was genuine, so that the intention in this case is deemed. The tenant who was not versed in tenancy law, but nonetheless was not entirely comfortable with getting the repairs done herself – she only understood it was not her responsibility to repair once she had consulted with Tenancy Services – was disadvantaged by being put to stress and effort she should not have been. It is the tenant’s interests that the Tribunal make an order to vindicate the harm to her. The public interest calls for an order so that this landlord and others are deterred from similar breaches.
- I temper the order for exemplary damages in this case because the landlord’s agent has been frank, attentive, and displayed a willingness to comply with the RTA.
- I set exemplary damages at $800.00 in this case. What should the tenants’ contribute to the cost of damage?
- The landlord is in the process of applying to his insurance company for cover for the damage. His excess is $550.00.
- The damage the tenants are liable for would probably cost approximately $550.00 to repair.
- I consider that amount is an appropriate amount to order the tenants to contribute. Filing fee
- The tenants have substantially succeeded in their claim. The Tribunal orders the landlord to reimburse them for the cost of the filing fee.