Published tribunal order
Tenancy Tribunal case 4763637 — Rent arrears
Decided 24 May 2024 · Published 24 May 2024 · Application 4763637
- Rent arrears
Party names are redacted in the official published order.
Order
- The Tribunal orders suppression of all the tenants’ names, the name of the landlord and the address of the property.
- The Bond Centre is to pay the bond of $1,600.00 ([Bond number suppressed]) to [The landlord/s].
- [Tenant 1] must pay [The landlord/s] $371.43.
- [Tenant 2] must pay [The landlord/s] $1,285.71 immediately. DescriptionLandlord Rent arrears [Tenant 1] and [Tenant 2] to 10 January 2024 $2,342.86 Rent arrears [Tenant 2] 11 January 2024 to 24 January 2024 $400.00 Rent arrears [Tenant 2] 25 January 2024 to 05 February 2024 Total $514.28 $3,257.14 Total payable by [Tenant 1] to landlord, half share rent arrears to 10 January 2024 less half share bond $371.43 Total payable by [Tenant 2] to Landlord, half share rent arrears to 10 January 2024, plus rent arrears 11 January 2024 to 05 February 2024 less half share of bond. $1,285.71
- [The landlord/s] do not seek any monetary orders against [Tenant 3], and none are made. The orders made against [Tenant 1] and [Tenant 2] is for their share of the rent only.
Reasons
- [The landlord’s representative] appeared for the landlord. [Tenant 1] appeared for [Tenant 2]. There was no appearance by [Tenant 3].
- The tenancy in this matter was a fixed term joint tenancy with the landlord and [Tenant 1], [Tenant 2], and [Tenant 3], commencing on 27 October 2023, and ending on 11 April 2024. [Tenant 1] and [Tenant 2] are in a relationship together.
- The landlord’s application was filed on 12 December 2023, following by the tenant’s counterclaim on 22 February 2024.
- These matters were first listed for hearing on 02 March 2024. However, there was insufficient time set aside to hear all the claims, and the matter was adjourned part heard, evidence directions were also made.
- Following the filing of the landlord’s application, [Tenant 1] followed by [Tenant 2] served the landlord with notice to withdraw from the tenancy for family violence under section 56B (1) of the Residential Tenancies Act 1986 (The “Act”). The notices and qualifying evidence have been produced. The landlord, nor the Tribunal, may seek to question whether the alleged violence has, in fact, occurred in a family relationship. Any challenge by the landlord challenge is limited to whether the notice is valid, that is whether it is in the correct form, and whether it has been properly served.
- The dispute in this case is not with the validity of the notice but with the service of one of the two notices. The timing of which will affect the rent liability of [Tenant 2] and [Tenant 3]. [Tenant 1] states that both himself and [Tenant 2] attended the Court on 03 January 2024 and made declarations in support of their respective notices on the same date. [Tenant 1] states that on 07 January 2024, in two separate emails, they both sent the notice and declaration to the landlord. Both declarations have been sworn on 03 January 2024, the notices are dated 07 January 2024 and give the tenant’s last day as 10 January 2024.
- Unfortunately, [Tenant 2]’s notice was sent the wrong email address. The error was subsequently discovered, and the notice resent to the landlord on 04 February 2024. [Tenant 1] submits that [Tenant 2]’s notice should be taken as validly served on 07 January 2024, meaning that both his and [Tenant 2]’s notices of withdrawal are effective from the same date, ending both tenancies on 10 January 2024.
- While the landlord accepts that [Tenant 1]’s withdrawal is properly served and was effective from 10 January 2024, they state that there are no provisions in the Act excusing [Tenant 2]’s notice not being properly served. The landlord claims therefore all tenants are liable for rent until 10 January 2024, thereafter, subject to the rent reduction calculation under section 56B (5), that [Tenant 2], and [Tenant 3] are liable for rent until 05 February 2024, after which another tenancy agreement was entered. Landlord’s claims Rent arrears from all tenants from 27 October 2023 to 10 January 2024,
- The rent summary provided shows that on 01 December 2023 the rent was up to date. Thereafter [Tenant 1] and [Tenant 2] stopped paying their share. It is accepted that [Tenant 1]’s last day was 10 January 2024. Up until that date under section 56B of the Act, all joint tenants were liable for the rent. Tenants are jointly and severally liable for the rent. In this case the landlord is only seeking the share owed by [Tenant 1] and [Tenant 2], stating that [Tenant 3] continued to pay the landlord his share, $200.00 per week, and did so up until 05 February 2024 when the landlord entered a new tenancy agreement.
- The total rent due from 27 October 2023 to 10 January 2024 was $6,514.29, of which [Tenant 3] has paid a third share of $2,171.43. [Tenant 1] and [Tenant 2] share was $4,343.86. Out of that share [Tenant 1] and [Tenant 2] have paid a total of $2,000.00, leaving $2,342.86 outstanding ($1,171.43 each for both [Tenant 1] and [Tenant 2]). Rent arrears owed by [Tenant 2], and [Tenant 3], from 11 January 2024 to 05 February 2024,
- There are no provisions in the Act allowing the Tribunal to waive compliance regarding service of the withdrawal notices. In this case [Tenant 2]’s notice of withdrawal was not served until 04 February 2024. [Tenant 2], along with [Tenant 3], are both liable for rent from 11 January 2024 to 24 January 2024, at the reduced rate, and then the full amount in equal shares until the entering of the new agreement on 05 February 2024.
- This claim must therefore be broken down into two parts, [Tenant 2]’s, and [Tenant 3]’s liability at the reduced rate for two weeks from 11 January 2024, as set out in section 56B (5), and thereafter from 24 January 2024 until 05 February 2024.
- The calculation is the rent usually payable for two weeks, divided by the number of tenants before withdrawal, multiplied by the number of remaining tenants equals the rent liability for the remaining tenants for the following fortnight.
- The rent payable was $600.00 per week. Two weeks rent was $1,200.00. There were three joint tenants’ immediately prior to [Tenant 1] withdrawal on 10 January 2024. After [Tenant 1]’s withdrawal they were three.
- In this case the calculation is $1,200.00 divided by 3 multiplied by 2 = $ 800.00. This was the rent liability of the remaining tenants for the two-week period 11 January 2024 to 24 January 2024.
- The rent summary shows that [Tenant 3] continued to pay $200.00 per week and on that basis has paid his share of the reduced rent. The landlord is seeking an order against [Tenant 2] for her share which is $400.00.
- At the end of the rent reduction the rent will return to its pre withdrawal amount, which as stated was $600.00 per week.
- From 25 January 2024 to the effective date of [Tenant 2]’s withdrawal notice on 05 February 2024, the rent obligation of both [Tenant 2] and [Tenant 3] was $1,028.57, or $514.28 in equal shares.
- The awards for rent arrears are proved. Tenant changed the locks without the prior consent or approval of the landlord, section 46 of the Act. For this the landlord seeks exemplary damages.
- On 24 November 2023, the landlord received an email from [Tenant 3] stating that he had been locked out of the upstairs part of the property.
- Section 46(1) of the Act provides that neither tenant or landlord may alter any existing lock or add or remove a lock without the consent of the other. A failure to comply, without reasonable excuse, may result in exemplary damages under section 49(3).
- [Tenant 1] states following a dispute with [Tenant 3] that he installed a lock on the door between the area of the property occupied by [Tenant 3] and [Tenant 2] and himself. Shortly after being challenged by the landlord, which appears to be the day the lock was installed, [Tenant 1] states he removed in. A short time later [Tenant 1] and [Tenant 2] ceased living at the property. The landlord did not view the lock, nor have they inspected the site where they believed the lock had been installed. The catalyst for this dispute is a disagreement between the joint tenants regarding demarcation of living areas. The overarching reason for this dispute appears to have been at the inspection and entering of the agreement on 27 October 2023, which I will set out in the tenant’s claim. In my opinion [Tenant 1] was unclear as to the legal relationship between himself and [Tenant 3] and that this was a significant factor in his installing the lock. I am satisfied that doing so was the result of an honest, but mistaken, belief. On that basis I am satisfied that [Tenant 1] had a reasonable excuse. While there has been a breach, I do not consider an award of exemplary damages is warranted. Tenants claims.
- The first claim I will deal with is one that the landlord should be estopped or barred for bringing a claim for rent arrears. [Tenant 1] and [Tenant 2] state that they had been led to believe by the landlord that they would be released from the tenancy but were not. On that basis they claim that they should not be held liable for rent from the time they advised the landlord of issues concerning their co-tenant around 25 November 2023, until the date they were forced to vacate the property on 23 December 2023, and thereafter up to the withdrawal notices in January 2024.
- The Tribunal may make any orders that the High Court or District Court may make under any enactment or rule of law relating to contracts (see s 78(1)(h) of the Act). This includes equitable remedies such as estoppel. A party claiming an equitable estoppel must establish that: a. A belief or expectation has been created or encouraged through some action, representation, or omission to act by the other party. b. The belief or expectation has been reasonably relied on to their detriment. c. It would be unconscionable for the party against whom the estoppel is alleged to depart from the belief or expectation.
- The underlying principle of equitable estoppel is to prevent the exercise of strict legal rights in circumstances where the exercise of them would be unconscionable. This principle is entirely consistent with the jurisdiction of the Tenancy Tribunal (Stella & Carey v Bay of Islands Realty Limited & Kirkman [2016] NZTT Kaikohe 4051975 & 4053657), in particular s 85(2) RTA, provides that: The Tribunal shall determine each dispute according to the general principles of law relating to the matter and the substantial merits and justice of the case but shall not be bound to give effect to strict legal rights or obligations or to legal forms or technicalities.
- Shortly after the tenancy commenced [Tenant 1] advised that landlord that himself and [Tenant 2] had come into conflict with [Tenant 3]. In the material before me [Tenant 1] questions whether [Tenant 3] is the head tenant, and they are his flatmates, or whether they are all joint tenants. The tenancy agreement clearly shows that this was a joint tenancy. Any misunderstanding on [Tenant 1’s] part was likely because [Tenant 3] was already residing at the property at the time the new agreement with all three was entered. Over the period November and December 2023, [Tenant 1] attempted to resolve the matter be extricating himself and [Tenant 2] from the agreement. On 01 December 2023, [Tenant 1] covertly recorded a telephone phone call between himself and [The landlord’s representative] in which he claims that [The landlord’s representative] agreed to release him from the tenancy.
- In He v Bai (DC Waitakere, CIV-2013-090-455, 23 October 2013) the District Court held that a covert recording was relevant and admissible. The overriding principle is one of fairness to both parties. Where a recording of a conversation is made without the knowledge of the other party, this is a factor which can be considered in determining the weight given to the evidence.
- I have listened to the recording twice and discussed it with both parties and considered it with the evidence, namely text messages, produced by both parties. There is no concluded agreement that [Tenant 1] and [Tenant 2] were to be released from the tenancy. On 03 December 2023, the landlord messaged the tenant stating that in principle they were prepared to consider removing [Tenant 1] and [Tenant 2] from the tenancy , which would require [Tenant 3]’s consent , although it was not thought in the circumstances that he would oppose, that the parties agree a departure date , that [Tenant 1] and [Tenant 2] would remain liable for rent until the agreed date , that their portion of the bond would be refunded and that they contribute $500.00 to the costs of entering into another agreement. Initially [Tenant 1] and [Tenant 2] accepted the proposal but then withdrew, [Tenant 1] stating that he and [Tenant 2] had changed their minds, advising the landlord that they would explore other options including the Tribunal. On 07 January 2024, and then 04 February 2024 [Tenant 1] and then [Tenant 2] served the landlord with notices to withdraw for family violence.
- On the evidence this is not a case where estoppel applies. Interference with peace, comfort, and privacy
- The next claim is described as “misleading acts of implementation of house rules regarding private and shared areas resulting in the rise of dispute between co-tenants resulting in threats of physical harm mental abuse.....” This claim alleges that the landlord has interfered with the reasonable peace, comfort, and privacy of the tenants.
- During the inspection and entering of the tenancy agreement [Tenant 1] states that the landlord pointed out defined boundaries within the property, that [Tenant 3] was to have exclusive access rooms downstairs which included a bedroom, living space and bathroom, and [Tenant 1] would have exclusive access to the upstairs which also contained a living space and bathroom. The kitchen and laundry are upstairs. [Tenant 1] states that access to these areas were not discussed. [Tenant 1] states the landlords setting out of the living areas had ultimately led to a conflict between the tenant’s, [Tenant 1] and [Tenant 2] believing that they had exclusive access to the entire upstairs area. That the landlord imposing rules, which they discovered he was not entitled to do, was an act that interfered with the tenant’s reasonable peace, comfort, and privacy.
- The landlord states that as [Tenant 3] was residing at the property and was being joined by [Tenant 1] and [Tenant 2], he simply pointed out the areas that [Tenant 3] was already using. [The landlord’s representative] states that he did not “dictate” how the property was to be divided and feels that he made it clear that as joint tenants it was ultimately up to them as to how they chose to use the property.
- Section 38(1) of the Act provides that the tenant shall be entitled to quiet enjoyment of the premises without interruption by the landlord or any person claiming by, though, or under the landlord or having superior title of the landlord.
- Section 38(2) of the Act states that a landlord must not cause or permit any interference with the reasonable peace, comfort, or privacy of the tenant in their use of the premises.
- In the case of Smith v Floris, Auckland TT 1404/93, 9 March 1994 at 6, the Tribunal stated, “Quiet enjoyment means effectively the right not to have the quality of the tenancy significantly impaired by actions of the landlord and/or the landlord’s agents”.
- Having heard from both parties, I am not satisfied that the landlord has necessarily acted in such a way or said anything that has directly led to an interference with the tenant’s reasonable peace comfort and privacy of the tenant. The tenant’s other claims That the landlord has failed to provide a copy of the insulation and Healthy Homes statement.
- Section 13A(1A) of the Act provides that every tenancy agreement must include an insulation statement containing the following information: a. Whether there is any insulation installed in ceilings, walls, and floors, and b. Details of the location, type, and condition of the insulation.
- This requirement does not apply where the landlord has not been able to provide some or all the required information, despite making reasonable efforts to do so. In this situation the landlord must describe the information they have been unable to obtain, explain why they have not been able to obtain it, and confirm they have made a reasonable effort to do so (see ss 13A(1B) and (1C) of the Act).
- Breaching the requirement in s 13A(1A) is an unlawful act for which exemplary damages may be awarded up to a maximum of $750.00 (see s 13(1F) and Schedule 1A of the Act).
- Under s 13A(1CA) of the Act, landlords must include in the tenancy agreement a signed statement: (a) That on and after the commencement of the tenancy, the landlord will comply with the healthy homes standards as required and (b) Include the information (if any) prescribed by regulations under section 138B(5) .
- The Regulations referred to in (b) above are the Residential Tenancies (Healthy Homes Standards) Regulations 2019. Part 3 Regulation 33 provides any statement must provide details of heating, insulation, ventilation, draft stopping, moisture ingress and drainage, and, if the landlord seeks to rely on one of the exemptions, the reasons why.
- Section 13A(1F) of the Act provides that a landlord commits an unlawful act if they fail to include a healthy homes statement in the tenancy agreement. The Tribunal may award exemplary damages up to $750.00 for failure to provide the insulation statement.
- Where a party has committed an unlawful act intentionally, the Tribunal may award exemplary damages where it is satisfied it would be just to do so, having regard to the party’s intent, the effect of the unlawful act, the interests of the other party, and the public interest (see s 109(3) of the Act).
- The tenancy agreement contains the following statement: “ ... we will comply with the healthy homes standards as required by s45(1)(bb) of the Residential Tenancies Act 1986. The insulation meets the minimum requirements for ceiling and underfloor insulation. We, [ the landlord] declare that the information contained in the insulation statement is true and correct as at the date of signing and all reasonable efforts have been made to obtain information about the location, type, and condition of insulation at the premises.”
- The issue is whether this is sufficient information under section 13A(1A)(a) and (b) and 13A(1CA)(a) and (b) .
- Regarding the insulation, the landlord’s statement does not provide sufficient detail to satisfy 13A(1A) (b), as it does not describe the location, type, or condition of the insulation.
- Concerning the landlord’s HHS statement, it too does not meet the requirements providing sufficient information under 13(1CA) (b).
- The landlord has breached the provision so the Act regarding the insulation statement and the HHS statement.
- Turning to the matter of exemplary damages. The landlords have turned their mind to their obligations but have mistakenly believed that their statement was sufficient. Had the landlord used the standard forms provided by Tenancy Services this breach would likely not have occurred. On the evidence I am not satisfied that there has been tangible impact on the tenants. While there has been a breach, I am not satisfied that an award of exemplary damages is warranted. Insulation compliance
- For all tenancies entered between 01 July 2021, and 27 August 2022, this tenancy commenced on 15 May 2022, the landlord had 90 days within which to comply with the Residential Tenancies (Healthy Homes Standards) Regulations 2019 (“HHS Regulations”). If the tenancy had been entered after 27 August 2022, there would have been 120 days to comply. All residential properties offered for rent must comply with the HHS Regulations by 01 July 2025.
- Premises must be insulated to a minimum standard (see s 45(1)(bb) of the Act and the HHS Regulations. In this case, for this location within the North Island, the minimum R-value for ceiling insulation is 2.9, and the minimum R value for underfloor insulation is 1.3. The insulation must also be in reasonable condition.
- There are exceptions to these requirements, for example, where it is impractical to install insulation, or where there is a habitable space above or below the ceiling or floor that would otherwise have to be insulated.
- The landlord has produced a statement of insulation compliance prepared by an independent contractor dated 15 June 2020. It states that the property has a skillion style roof and ceiling and is therefore exempt, and that the underfloor insulation is R 1.5.
- There is no challenge to this evidence. The claim is dismissed. Failure to maintain.
- Section 45(1)(b) of the Act states that the landlord must provide and maintain the property in a reasonable state of repair, having regard to the age and character of the property and the period during which the property is likely to remain habitable and available for residential purposes.
- The tenant claims that the landlord has failed to maintain the oven, window seals, the curtains, the window faces in a reasonable condition, and that the property free from insects.
- No evidence has been produced. The claim is dismissed. Other matter
- At the end of hearing the claims in the application, the tenant sought to raise a further claim that the landlord had breached section 56E of the Act by disclosing details of the withdrawal notice to [Tenant 3]. [Tenant 1] has had ample opportunity to amend the application before the hearing. I decline to amend the application or to adjourn the matter for [Tenant 1] to seek to amend this application. However, section 56E(2)(c) permits disclosure for the purposes of or in connection with legal proceedings or procedure under the Residential Tenancies Act or any other Act to settle any dispute between landlord and tenant. The landlord’s application, which included reference to the withdrawal notice, was, as required, served on each of the joint tenants. Although [Tenant 1] and [Tenant 2] have not included [Tenant 3] as a party to their counterclaim, concerning the claims that the landlord breached the tenants right to quiet enjoyment and the HHS standards and regulations, he was as a joint tenant a party and entitled to be advised of the claims and the hearing, which he was. Section 56E of the Act clearly relates to the prohibition on disclosure to those who are not the landlord or tenant or otherwise a party. Had the claim been accepted it would have been declined. Costs
- Both parties seek reimbursement of their respective filing fees. Arguably both have at least been partly successful triggering the Tribunal’s discretion under section 102(4)(b) of the Act to order reimbursement of the filing fee. However, as reimbursing the filing fee to one would effectively cancel reimbursement to the other, and vice versa, I make no order for reimbursement of the filing fees. Name suppression
- Section 95A(1A) states that the Tribunal must in any proceedings that relate to section 56B order that the name and identifying details of the parties not be published. Accordingly, I suppress the name of the landlord, each of the joint tenants, and the address of the property.