What was Tenancy Tribunal case 4643749 about?

The tribunal order states: An application for suppression has been made in this case, and the Tribunal

How much money was awarded in case 4643749?

The reconciled net award was $20.44.

What type of tenancy dispute was case 4643749?

The dispute type was not classified.

Where can I read the official tribunal order for case 4643749?

The official Ministry of Justice published order is available at https://forms.justice.govt.nz/search/Documents/TTV2/PDF/9357764-Tribunal_Order_Redacted.pdf.

What was Tenancy Tribunal case 4643749 about?

The tribunal order states: An application for suppression has been made in this case, and the Tribunal

How much money was awarded in case 4643749?

The reconciled net award was $20.44.

What type of tenancy dispute was case 4643749?

The dispute type was not classified.

Where can I read the official tribunal order for case 4643749?

The official Ministry of Justice published order is available at https://forms.justice.govt.nz/search/Documents/TTV2/PDF/9357764-Tribunal_Order_Redacted.pdf.

Unit/Flat 2, 69 Lake Road, Devonport, Auckland 0624 Tenancy Tribunal Case 4643749 — Tenancy dispute

Order

An application for suppression has been made in this case, and the Tribunal orders suppression of both parties’ names and identifying details.
The notice to terminate the tenancy at the above address is invalid. For clarity, the tenancy agreement remains in place until 24 August 2024.
[The landlord/s] must pay [The tenant/s] $20.44 immediately, being reimbursement of the filing fee.

Reasons

Both parties attended the hearing.
The landlord has applied for termination of the tenancy following the issue of a termination notice.
The tenant has applied for a declaration that the termination notice is invalid. Background and Legal Framework
The parties entered into a tenancy agreement which was signed on 28 July 2022. The agreement was for an initial fixed term which commenced on 26 August 2022 and ended on 24 August 2023.
Directly below the initial fixed term clause, an additional clause provided as follows. Provided the terms of this lease have not been abrogated by the tenant and all payments owing under the lease (including all other charges from the lease) are paid up to date the tenant may extend the lease until 22 nd August, 2024. Should the tenant wish to extend the least to 22 nd August, 2024, the tenant must give such notice by email to the Landlord by 22 nd August, 2023.
Generally speaking, fixed term tenancies are governed by section 60A of the Residential Tenancies Act 1986 (“the Act”). That section provides as follows. 60A Fixed-term tenancy becomes periodic unless contrary notice given (1) On the expiry of a fixed-term tenancy of more than 90 days, the tenancy continues as a periodic tenancy with the same terms as the terms contained in the expired tenancy so far as those terms are consistent with a periodic tenancy. (2) However, the tenancy does not continue as a periodic tenancy if,— (a) before the expiry, the parties renew or extend the existing tenancy agreement; or (b) before the expiry, the parties agree not to continue with the tenancy; or (c) at least 28 days before the expiry, the tenant gives the landlord written notice of the tenant’s intention not to continue with the tenancy; or (d) before the expiry, a party gives notice as mentioned in any of section 50(1)(a) to (b) that terminates the tenancy on or before the expiry or that would do if the tenancy were already periodic. (3) Subsection (4) applies if— (a) a tenancy continues as a periodic tenancy under subsection (1); but (b) before the continuation, a party gave notice as mentioned in any of section 50(1)(a) to (b) that would, if the tenancy had been fixed-term throughout or periodic throughout, terminate the tenancy from a time after the continuation. (4) The tenancy is terminated with effect from that time (and the termination is to be treated as falling within the relevant paragraph of section 50(1)).
Relevantly, section 60A(2)(d) provides that a landlord may terminate by notice if the landlord does so before the expiry of the fixed term and provided a valid reason is given (as referenced in sections 50(1)(a) to (b).
Earlier this year, the landlord sent a notice of termination to the tenant. The notice was not dated although I have sighted the email to which it was attached, and that email was dated 21 June 2023. The notice was expressed in these words: This letter serves as a notice to terminate the fixed-term tenancy agreement at the above address. The last day of the tenancy will be 20 th September 2023.
The notice was on a standard form as provided by Tenancy Services and the reason given for the termination was that “the premises are to be put on the market by the owner within 90 days after the termination date for the purposes of sale or other disposition”.
It was the landlord’s view that this notice was compliant with section 60A of the Act and was therefore a valid notice.
On 22 July 2023 the tenants emailed the landlord and exercised their right to extend the tenancy for a further 12 months, to 24 August 2024.
The tenants’ view is that the express clause in the Tenancy Agreement gave them a right to extend the term and that section 60B of the Act also provides the basis for exercising such a right.
Section 60B provides as follows. 60B Tenant must exercise right to renew or extend tenancy not later than 28 days before expiry (1) A tenant who wishes to exercise a right under the tenancy agreement to require the landlord to grant the tenant a renewal or an extension of the tenancy must exercise that right by giving the landlord written notice, in accordance with this section, of the tenant’s intention to exercise the right. (2) The tenant must give notice of the tenant’s intention not later than the 28th day before the date on which the tenancy would otherwise expire.
Section 60B(3) to (5) relate to applications where a tenant has failed to comply with the above, and are not relevant to the present case.
Section 11(1) of the Act provides that any clause in a Tenancy Agreement that is inconsistent with the Act shall have no effect. However, and importantly for this case, section 11(2) further provides that subsection (1) “shall not prevent a landlord from waiving voluntarily all or any of the rights and powers conferred on landlords by this Act, or from voluntarily incurring more or more extensive obligations than those that are imposed on landlords by this Act.”
In other words, a landlord is entitled to contract out of the Act and accept greater obligations than the Act may otherwise impose on them. Discussion
The landlord in this case was at pains to point out that the owner will suffer a hardship if the tenancy is not terminated. Evidence has been provided that due to rising interest rates, her mortgage repayments have increased, and this is causing financial difficulty.
The landlord said that because of that the landlord has decided to sell the property and that is why she requires the tenancy to be terminated.
The tenants pointed out that if they have to move, they will also suffer financial hardship. Moving is a costly exercise both financially and emotionally, which is why they wanted a long-term tenancy.
I accept that both parties may suffer some hardship.
However, hardship is not a relevant issue to my determination of this particular dispute.
The issue that arises in this case is whether the landlord is bound by the signed Tenancy Agreement that contains a clause which gives the tenants a right to extend the fixed term.
In my view, the answer to that question must be “yes”.
In broad terms, a contract is binding and legally enforceable if both parties intended to make the contract and agree about what is in the contract. Such agreement is usually evidenced by the signatures of the parties. That is the case here.
There are some situations in which a contract may not be enforceable (e.g., duress, misrepresentation) but there has been no suggestion that any of those exceptions apply in this case.
Rather, this appears to be a case where they landlord has simply had a change of mind and no longer wishes to allow the tenant to be allowed to extend the fixed term.
During the hearing, the landlord repeatedly referred to section 60A of the Act and said that giving notice in the way he had done was the norm in fixed term tenancies.
He is not wrong about that. Had this been a standard fixed term tenancy then the landlord would have been able to give notice in accordance with section 60A.
However, this is not a “standard” fixed term tenancy. This is a case where a tenancy agreement has been signed that expressly provides the tenants with a right to extend the term of the tenancy.
The tenants have exercised the right to extend in accordance with the express terms of the agreement and in accordance with section 60B of the Act.
The Tribunal is therefore bound to give effect to the express terms of the Agreement.
Accordingly, I find that the tenants have validly exercised their right to extend the tenancy and declare that the notice to terminate the tenancy is invalid.
I should add that I do sympathise and understand the reasons why the owner may wish to sell the premises. However, having the tenants remain does not prevent her from doing so. It simply means that she will have to market the premises with the tenants in situ. There is certainly a chance that a prospective purchaser would be happy to purchase the premises with tenants already in place.
The tenants understand that they will have to accommodate the owner’s need for marketing and viewings/open homes and allow reasonable access in accordance with section 48 of the Act.
Because the tenants have wholly succeeded with the claim, I must reimburse the filing fee. J R Smith 30 August 2023

Order

An application for suppression has been made in this case, and the Tribunal orders suppression of both parties’ names and identifying details.
The notice to terminate the tenancy at the above address is invalid. For clarity, the tenancy agreement remains in place until 24 August 2024.
[The landlord/s] must pay [The tenant/s] $20.44 immediately, being reimbursement of the filing fee.

Reasons

Both parties attended the hearing.
The landlord has applied for termination of the tenancy following the issue of a termination notice.
The tenant has applied for a declaration that the termination notice is invalid. Background and Legal Framework
The parties entered into a tenancy agreement which was signed on 28 July 2022. The agreement was for an initial fixed term which commenced on 26 August 2022 and ended on 24 August 2023.
Directly below the initial fixed term clause, an additional clause provided as follows. Provided the terms of this lease have not been abrogated by the tenant and all payments owing under the lease (including all other charges from the lease) are paid up to date the tenant may extend the lease until 22 nd August, 2024. Should the tenant wish to extend the least to 22 nd August, 2024, the tenant must give such notice by email to the Landlord by 22 nd August, 2023.
Generally speaking, fixed term tenancies are governed by section 60A of the Residential Tenancies Act 1986 (“the Act”). That section provides as follows. 60A Fixed-term tenancy becomes periodic unless contrary notice given (1) On the expiry of a fixed-term tenancy of more than 90 days, the tenancy continues as a periodic tenancy with the same terms as the terms contained in the expired tenancy so far as those terms are consistent with a periodic tenancy. (2) However, the tenancy does not continue as a periodic tenancy if,— (a) before the expiry, the parties renew or extend the existing tenancy agreement; or (b) before the expiry, the parties agree not to continue with the tenancy; or (c) at least 28 days before the expiry, the tenant gives the landlord written notice of the tenant’s intention not to continue with the tenancy; or (d) before the expiry, a party gives notice as mentioned in any of section 50(1)(a) to (b) that terminates the tenancy on or before the expiry or that would do if the tenancy were already periodic. (3) Subsection (4) applies if— (a) a tenancy continues as a periodic tenancy under subsection (1); but (b) before the continuation, a party gave notice as mentioned in any of section 50(1)(a) to (b) that would, if the tenancy had been fixed-term throughout or periodic throughout, terminate the tenancy from a time after the continuation. (4) The tenancy is terminated with effect from that time (and the termination is to be treated as falling within the relevant paragraph of section 50(1)).
Relevantly, section 60A(2)(d) provides that a landlord may terminate by notice if the landlord does so before the expiry of the fixed term and provided a valid reason is given (as referenced in sections 50(1)(a) to (b).
Earlier this year, the landlord sent a notice of termination to the tenant. The notice was not dated although I have sighted the email to which it was attached, and that email was dated 21 June 2023. The notice was expressed in these words: This letter serves as a notice to terminate the fixed-term tenancy agreement at the above address. The last day of the tenancy will be 20 th September 2023.
The notice was on a standard form as provided by Tenancy Services and the reason given for the termination was that “the premises are to be put on the market by the owner within 90 days after the termination date for the purposes of sale or other disposition”.
It was the landlord’s view that this notice was compliant with section 60A of the Act and was therefore a valid notice.
On 22 July 2023 the tenants emailed the landlord and exercised their right to extend the tenancy for a further 12 months, to 24 August 2024.
The tenants’ view is that the express clause in the Tenancy Agreement gave them a right to extend the term and that section 60B of the Act also provides the basis for exercising such a right.
Section 60B provides as follows. 60B Tenant must exercise right to renew or extend tenancy not later than 28 days before expiry (1) A tenant who wishes to exercise a right under the tenancy agreement to require the landlord to grant the tenant a renewal or an extension of the tenancy must exercise that right by giving the landlord written notice, in accordance with this section, of the tenant’s intention to exercise the right. (2) The tenant must give notice of the tenant’s intention not later than the 28th day before the date on which the tenancy would otherwise expire.
Section 60B(3) to (5) relate to applications where a tenant has failed to comply with the above, and are not relevant to the present case.
Section 11(1) of the Act provides that any clause in a Tenancy Agreement that is inconsistent with the Act shall have no effect. However, and importantly for this case, section 11(2) further provides that subsection (1) “shall not prevent a landlord from waiving voluntarily all or any of the rights and powers conferred on landlords by this Act, or from voluntarily incurring more or more extensive obligations than those that are imposed on landlords by this Act.”
In other words, a landlord is entitled to contract out of the Act and accept greater obligations than the Act may otherwise impose on them. Discussion
The landlord in this case was at pains to point out that the owner will suffer a hardship if the tenancy is not terminated. Evidence has been provided that due to rising interest rates, her mortgage repayments have increased, and this is causing financial difficulty.
The landlord said that because of that the landlord has decided to sell the property and that is why she requires the tenancy to be terminated.
The tenants pointed out that if they have to move, they will also suffer financial hardship. Moving is a costly exercise both financially and emotionally, which is why they wanted a long-term tenancy.
I accept that both parties may suffer some hardship.
However, hardship is not a relevant issue to my determination of this particular dispute.
The issue that arises in this case is whether the landlord is bound by the signed Tenancy Agreement that contains a clause which gives the tenants a right to extend the fixed term.
In my view, the answer to that question must be “yes”.
In broad terms, a contract is binding and legally enforceable if both parties intended to make the contract and agree about what is in the contract. Such agreement is usually evidenced by the signatures of the parties. That is the case here.
There are some situations in which a contract may not be enforceable (e.g., duress, misrepresentation) but there has been no suggestion that any of those exceptions apply in this case.
Rather, this appears to be a case where they landlord has simply had a change of mind and no longer wishes to allow the tenant to be allowed to extend the fixed term.
During the hearing, the landlord repeatedly referred to section 60A of the Act and said that giving notice in the way he had done was the norm in fixed term tenancies.
He is not wrong about that. Had this been a standard fixed term tenancy then the landlord would have been able to give notice in accordance with section 60A.
However, this is not a “standard” fixed term tenancy. This is a case where a tenancy agreement has been signed that expressly provides the tenants with a right to extend the term of the tenancy.
The tenants have exercised the right to extend in accordance with the express terms of the agreement and in accordance with section 60B of the Act.
The Tribunal is therefore bound to give effect to the express terms of the Agreement.
Accordingly, I find that the tenants have validly exercised their right to extend the tenancy and declare that the notice to terminate the tenancy is invalid.
I should add that I do sympathise and understand the reasons why the owner may wish to sell the premises. However, having the tenants remain does not prevent her from doing so. It simply means that she will have to market the premises with the tenants in situ. There is certainly a chance that a prospective purchaser would be happy to purchase the premises with tenants already in place.
The tenants understand that they will have to accommodate the owner’s need for marketing and viewings/open homes and allow reasonable access in accordance with section 48 of the Act.
Because the tenants have wholly succeeded with the claim, I must reimburse the filing fee. J R Smith 30 August 2023

Tenancy Tribunal case 4643749 — Tenancy dispute at Unit/Flat 2, 69 Lake Road, Devonport, Auckland 0624

At a glance

Award balance

Tenancy Tribunal case 4643749 — Tenancy dispute at Unit/Flat 2, 69 Lake Road, Devonport, Auckland 0624

At a glance

Award balance

Claims & awards

Order

Reasons

Topics & place

Residential Tenancies Act sections

Frequently asked questions

Claims & awards

Order

Reasons

Topics & place

Residential Tenancies Act sections

Frequently asked questions