What was Tenancy Tribunal case 4769800 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 4769800?

Property Damage: $1,200.00 awarded to tenant; Property Damage: $500.00 awarded to tenant; Filing Fee: $20.44 awarded to tenant; Key Deposit Reimbursement: $60.00 awarded to tenant; One Week'S Rent Reimbursement: $455.00 awarded to tenant

What type of tenancy dispute was case 4769800?

The primary dispute was Exemplary damages.

Where can I read the official tribunal order for case 4769800?

The official Ministry of Justice published order is available at https://forms.justice.govt.nz/search/Documents/TTV2/PDF/10172101-Tribunal_Order_Redacted.pdf.

What was Tenancy Tribunal case 4769800 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 4769800?

Property Damage: $1,200.00 awarded to tenant; Property Damage: $500.00 awarded to tenant; Filing Fee: $20.44 awarded to tenant; Key Deposit Reimbursement: $60.00 awarded to tenant; One Week'S Rent Reimbursement: $455.00 awarded to tenant

What type of tenancy dispute was case 4769800?

The primary dispute was Exemplary damages.

Where can I read the official tribunal order for case 4769800?

The official Ministry of Justice published order is available at https://forms.justice.govt.nz/search/Documents/TTV2/PDF/10172101-Tribunal_Order_Redacted.pdf.

Room 5, 10 Elizabeth Street, Petone, Lower Hutt 5012 Tenancy Tribunal Case 4769800 — Exemplary damages

Claims and awards in Tenancy Tribunal application 4769800 — net $4,055.44 NZD. Amounts reconciled from the published order (claims sum and net total). Verify on MoJ.
Claim	Tenant	Reason
Bond Reimbursement	$1,820.00	Bond Reimbursement
Key deposit reimbursement	$60.00	Key deposit reimbursement
One week's rent reimbursement	$455.00	One week's rent reimbursement
Exemplary damages: Failure to lodge bond	$1,200.00	Failure to lodge bond
Exemplary damages: Requiring security deposit	$500.00	Requiring security deposit
Filing fee reimbursement	$20.44	Filing fee reimbursement
Net award	$4,055.44
Total payable by Landlord to Tenant	$4,055.44

Claims and awards in Tenancy Tribunal application 4769800 — net $4,055.44 NZD. Amounts reconciled from the published order (claims sum and net total). Verify on MoJ.
Claim	Tenant	Reason
Bond Reimbursement	$1,820.00	Bond Reimbursement
Key deposit reimbursement	$60.00	Key deposit reimbursement
One week's rent reimbursement	$455.00	One week's rent reimbursement
Exemplary damages: Failure to lodge bond	$1,200.00	Failure to lodge bond
Exemplary damages: Requiring security deposit	$500.00	Requiring security deposit
Filing fee reimbursement	$20.44	Filing fee reimbursement
Net award	$4,055.44
Total payable by Landlord to Tenant	$4,055.44

Order

An application for suppression has been made in this case, and the Tribunal orders suppression of the Tenant name and identifying details only. 2. must pay immediately, calculated as shown in the table below.
The first respondent’s application against the tenant for rent arrears and refund of the bond is dismissed.
All other claims are dismissed.

Reasons

Both parties attended the hearing with the tenant attending the hearing in person. Mr Al Burchell attended for the first respondent by telephone. Mr Alex Sim attended for the second respondent by telephone.
The tenant seeks orders as follows: a. Refund of the bond and exemplary damages for requiring a bond of more than 4 weeks rent; b. Exemplary damages for failing to lodge the bond with the Bond Centre; c. Refund of a security key deposit and exemplary damages for requiring a security deposit.
The first respondent filed a cross claim for rent arrears. Background to the proceedings and jurisdiction
The second respondent, Bed Shed Limited, is the owner of the premises. The first respondent trading as “The Guest Home” was appointed by Alex Sim, the director of Bed Shed Limited, to manage the letting/operation of the premises pursuant to an agreement dated 18 April 2023 entitled “Sole Mandate/Legal Consent” (“the mandate”). In particular, this agreement was reached after discussions between Al Burchell and Alex Sim. A copy of the mandate was provided in evidence by Mr Burchell.
The premises, according to evidence given by the tenant and Mr Sim, are a boarding house. They comprise of seven rooms available to be rented out to tenants at any one time for their exclusive use and a right to the shared use of other facilities such as kitchen, living areas and laundry. At the hearing before me, Mr Sim gave further evidence that the premises are also consented for use as a boarding house by the local Council and comply with rules pertaining to boarding houses such as requirements for sound proofing, fire rating, ratios of bedrooms to bathrooms, and they are subject to an annual Warrant of Fitness inspection.
Mr Burchell disputes that the premises are subject to the jurisdiction of this Tribunal under the Residential Tenancies Act 1986 (RTA).
Mr Burchell provided the tenant with a document entitled “The Guest Home Rental Agreement” and then the title “Agreement between (Host/Owner; and the Guests/Tenant And Agent.)” The agreement contains the following statements and definitions: “This is a Flatmate Rental agreement..... As you sharing /Using a room in a house with others who all got their own rooms in same Property.... Regional Agent Name:....Al Burchell...OLA...Joan D... Host Details.....Full names:... Mrs. Mr. Burchell...The Guest Home....Joan Burchell.” “ Guest/Tenant Details: [Tenant name inserted]....”
This document (which I will refer to as “the tenancy agreement”) was signed by the tenant in handwriting but is not signed in handwriting by the “Host” or “Regional Agent.” However, the names “Mrs J Burchell” and “Burchell” have been printed in the signature boxes as shown in the following screen shot of the final page of the tenancy agreement provided by the tenant:
Under the tenancy agreement, the tenant was granted a tenancy of Room 5 in the premises and the right to share the use of other facilities.
These proceedings were first set down for a remote telephone hearing on 12 February 2024 (“the first hearing”). There was only time to determine the issue of jurisdiction at the first hearing. The tenant and Mr Sim attended the first hearing. Mr Burchell did not attend.
Adjudicator Tam issued an order dated 12 February 2024 which records his decision that the tenant’s claims fall within the jurisdiction of the Tenancy Tribunal under Part 2A of the RTA. In particular, the Tribunal found that the tenant and Mr Burchell had clearly entered a boarding house tenancy agreement for Room 5 at the premises rather then the purported “flatmate agreement” that Mr Burchell had couched the agreement on. Neither Mr or Mrs Burchell lived at the premises during this tenancy. In that regard, Adjudicator Tam stated: “any allusion to [the tenant] as Mr Burchell’s “flatmate”......does not and should not arise.” See the order under this application 4769800 dated 12 February 2024. The proceedings were then adjourned so that the substantive claims could be heard. On the day of the first hearing, Mr Burchell filed the cross application.
At the second hearing convened before me on 12 March 2024, Mr Burchell contended that he had applied for a rehearing of Adjudicator Tam’s decision on 12 February 2024, and he understood that his rehearing application was to be considered at the hearing before me. He disputes that the Tenancy Tribunal has jurisdiction to hear the tenant’s claims.
Mr Burchell made two arguments before me. The first was that this was a flatmate arrangement/homestay not subject to the RTA jurisdiction. In making this argument he is relying on section 5(1)(n) RTA which excludes jurisdiction “where the premises, not being a boarding house, continue to be used, during the tenancy, principally as a place of residence by the landlord or the owner of the premises or by any member of the landlord’s or owner’s family.” While Mr Burchell claims that he and his wife stayed at the premises for 12 weeks to ready it for renting, he confirmed that he did not stay there during this tenancy. Therefore, the arrangement is clearly not a flatmate arrangement as determined by Adjudicator Tam.
Mr Burchell also claimed that the agreement with the tenant is exempt from the jurisdiction of the Tenancy Tribunal under s 5(1)(y) RTA because the premises are being used to provide emergency or transient accommodation funded wholly or in part by a government department or under the Special Needs Grants Programme established under the Social Security Act 1964. Mr Sim gave evidence that he was happy for Mr Burchell to put MSD/WINZ clients in the premises, but he has no knowledge of the premises being approved as transitional/emergency housing. The tenant confirmed that he was not placed in the premises under any such scheme and he was not receiving any form of WINZ benefit during the tenancy.
I noted that no rehearing application was filed regarding Adjudicator Tam’s decision about jurisdiction, and I proceeded to hear the substantive claims. In any event, it is not open to Mr Burchell to “relitigate” the decision of Adjudicator Tam regarding jurisdiction before me. The decision must stand. The tenancy is a boarding house tenancy subject to the jurisdiction of this Tribunal under Part 2A RTA. I consider the substantive claims accordingly. Terms of the tenancy and appointment of Mr Burchell
As discussed further below, I am satisfied that Mr Burchell was the landlord in relation to this tenancy. It would appear that Mrs Joan Burchell assisted with some tasks.
As set out above, I understand that the premises are owned by Bed Shed Limited, and Mr Sim is the sole director of that company. In his capacity as director of the owner company, he entered into an arrangement with Mr Burchell for Mr Burchell to operate the letting of the premises.
The tenant and Mr Burchell, as landlord, reached an agreement that the tenant would rent a room in the premises. They each produced in evidence a version of the signed tenancy agreement which were slightly different. Both agreements recorded the following terms: a. Weekly rental—$455 inclusive of power, internet Wi-Fi, garden services, laundry facilities and cleaning services; b. 2 weeks rental up front—$910; c. Bond of 4 week’s rental—$1820; d. Key deposit—$60; e. Total move-in costs—$2,790.
Other handwritten information, signatures and initials appearing on each agreement differ. The tenant’s version of the agreement records a move in date of 30 August 2023 and a fixed term of 52 weeks starting on 30 August 2023 and ending on 30 August 2024. The dates are not initialled or signed by the tenant. A handwritten “B” appears in the margins by each of these dates which may have been written by Mr Burchell. On Mr Burchell’s version of the tenancy agreement produced in evidence, the move in date has been left blank but the starting date is 2 August 2023, and the end date is 2 August 2024.
After much discussion during the hearing, both the tenant and Mr Burchell accepted that the agreement was signed on 2 August 2023 but the actual move in date /tenancy start date was deferred to 4 September 2023. The tenant provided evidence that he paid the total move in costs of $2,790 in two instalments with $800 paid on 16 August 2023 and $1,990 paid on 2 September 2023. Both amounts were paid into the bank account for “The Guest Home” as specified in the tenancy agreement.
During the course of the tenancy, Mr Sim became concerned about Mr Burchell’s engagement which resulted in Mr Sim terminating the agreement with Mr Burchell around operation of the premises. Mr Sim then gave the tenant notice that he had terminated the arrangement with Mr Burchell and advised the tenant to redirect his rent payments to Mr Sim effective from 15 November 2023. The tenant did so until the tenancy was terminated by him giving the appropriate notice with effect on 7 January 2024.
Despite Mr Sim terminating Mr Burchell’s appointment to operate the premises effective from 15 November 2023, Mr Burchell sent the tenant demands for rent after that date and has filed a cross claim for rent arrears from the tenant which he claims accumulated after 15 November 2023. The tenant ignored the rent demands from Mr Burchell on the advice of Mr Sim.
Once the tenancy was terminated, Mr Sim arranged for the new property manager to inspect the tenant’s room and after doing so advised that the bond should be returned to the tenant. Mr Burchell had collected the total move-in costs including the bond and, as he confirmed at the hearing, these funds were held in trust in a bank account operated by Mr Burchell. However, the bond was not lodged with the Bond Centre. The tenant requested refund of his bond. Mr Sim noted that he did not collect the bond and it would need to be recovered from Mr Burchell. Mr Burchell contended that Mr Sim must refund the bond because Mr Sim was indebted to him as a result of their business dealings.
The tenant then discovered other breaches of the RTA concerning this tenancy for which he seeks redress. He says he was required to pay 1 weeks rent in advance that he claims has not been applied to rent and has been held unlawfully as further bond money. He was also required to pay a key deposit.

Who is the correct respondent?

Based on the evidence and submissions presented by the parties, I am satisfied that the landlord is Mr Burchell. Furthermore, as recorded in Adjudicator Tam’s decision, he is also known as WL Burchell and Llewellyn Burchell.
While there is reference in the tenancy agreement to Joan Burchell, I am satisfied on the evidence that communications between the parties concerning the tenancy were between the tenant and Mr Burchell. For example, the parties produced text messages in evidence which refer to Al Burchell as the sender/recipient. At the hearing Mr Burchell acknowledged that negotiated the terms of the tenancy, including the deferred start date for the tenancy. Mr Burchell also produced an invoice addressed to the tenant for the initial move-in costs with the attached payment advice slip recording payments to be made to “Burchell t/a The Guest Home”
The premises are owned by Bed Shed Limited, of which Mr Sim is the sole director. The mandate signed by Mr Sim authorised “The Guest Home” to find “Guests/Tenants for the owner’s homes; including” paying for advertising; meeting guests at the property, completing an agreement for guests who choose to move into the property; receive payments of rent and a 4 week deposit to be held until the guest leaves; and deduct a fee for services payable by the owner from rent received.
While the mandate refers to “The Guest Home” and does not name Mr Burchell as the other party to the agreement, I am satisfied that the “mandate” authorised Mr Burchell to act as property manager for Mr Sim. Mr Sim’s evidence is that all discussions regarding the mandate were between him, and Mr Burchell and they met and signed the mandate on 18 April 2023. The Guest Home is not recorded as the name of a registered company or other legal entity and Mr Burchell signed the agreement. Therefore, I find that he is a party to the agreement in his personal capacity trading as “the Guest House.” Other evidence presented during the hearing is also persuasive including Mr Burchell’s confirmation that the bond money is held “in trust” in a bank account to which he has access. While it appears that Mr Sim does not personally own the premises, he is the sole director of the owner company, and was in a position to sign the mandate appointing a property manager.
From the perspective of the RTA, the term “landlord” in section 2 means: landlord, in relation to any residential premises that are the subject of a tenancy agreement, means the grantor of the tenancy of the premises under the agreement; and, where appropriate, includes— (a) a prospective landlord; and (b) a former landlord; and (c) a lawful successor in title of a landlord to the premises; and (d) the personal representative of a deceased landlord; and (e) an agent of a landlord.
Therefore, the real question is: who was the grantor of the tenancy? I consider on the available evidence, that it was Mr Burchell. As far as the tenant is concerned, his dealings were with Mr Burchell, and he viewed Mr Burchell as the landlord.
The definition of landlord includes an agent of the landlord. Even if Mr Burchell was no more then a property manager for Mr Sim and/or Bed Shed Limited, he would be deemed to be at least, an agent. An agent, where appropriate is deemed a landlord, and I consider Mr Burchell must be viewed that way.
The tenancy agreement normally defines the parties to the agreement. However, the agreement here is not very clear, and would not meet the requirements of the RTA. The agreement does not define specifically who the landlord is but refers to “OLA Al Burchell” with the agreement not providing a definition of “OLA”. It also records “Regional Agent name:.... Al Burchell...OLA...Joan D” and records under Host Details “Mrs. Mr. Burchell....The guest Home.....Joan Burchell”. As shown in paragraph 8 above, on the final page of the agreement the name “Mrs J Burchell” has been printed in the signature box for the Owner/Host and the names “Joan & Al” and “Burchell” have been printed in the signature box for the Regional Agent.
There is no reference in the tenancy agreement to Mr Alex Sim or Bed Shed Limited as the owner or the landlord.
After carefully considering all the available evidence and information provided, I am satisfied that the grantor of this tenancy was Mr Burchell, and he was the landlord and the correct respondent in respect of the tenant’s claims. The tenant’s claims Requiring a bond of more than 4 weeks rent
A landlord must not require a bond greater than four weeks rent. See section 18(1) RTA. Breaching this obligation is an unlawful act for which the Tribunal may award exemplary damages up to a maximum of $1,500.00. See section 18(4) and Schedule 1A RTA.
The tenant claims the landlord requested a bond of more than four weeks rent. The tenancy agreement required a payment of 4 weeks rent for bond and a further 2 weeks rent in advance. However, the tenant claims that only one week’s rent paid in advance was applied to rent and the other week’s rent was held by the landlord. Therefore, the argument is that the landlord effectively held a bond equivalent to five weeks rent.
In presenting his argument, the tenant had considerable difficulty recalling the start date for the tenancy. This is understandable given it was not accurately recorded in either version of the tenancy agreement produced in evidence. The tenant suggested various dates before advising that the tenancy was to start on 11 September 2023. However, subsequent evidence of text messages between the parties seems to establish, and the parties accepted at the hearing, that the start date was 4 September 2024.
The tenant then referred to text messages dated from 3 September 2023 with Mr Burchell in which he complained about the condition of the premises at the start of the tenancy because they were not clean; there was no Wi-Fi available as agreed, and a smoke alarm required repair. He claims that Mr Burchell agreed in a telephone call to give him one week’s free rent from 4-10 September 2023, so that rent would only be payable from 11 September 2023. However, the discount was never given and Mr Burchell retained the rent.
Mr Burchell confirms that he and the tenant discussed compensation in the form of a week’s free rent, but it was not finally agreed. He said it would also create an “accounting issue”. So, instead the parties agreed that Mr Burchell would pay the tenant to clean the premises at a rate of $100/clean, twice monthly, and reimburse the tenant for cleaning materials purchased for that purpose. He did this on three occasions.
It is unclear what Mr Burchell means by an “accounting issue”. It would have been quite simple to provide a week’s free rent. As Mr Burchell had already received 2 weeks rent in advance, he could have instructed the tenant to make the next rent payment a week later than planned; or simply refund the extra week paid to the tenant.
The tenant says that the cleaning agreement was quite separate to the agreement to give one week’s free rent to compensate for the condition of the premises at the start date of the tenancy. The cleaning arrangement came about because Mr Burchell was having trouble finding a cleaner for the premises which was the landlord’s responsibility under the tenancy agreement. He asked the tenant on 13 September 2023 whether he would do the cleaning. The tenant produced two text messages in which he says Mr Burchell acknowledges the agreement to give one week’s rent discount. In a text exchange on 13 September 2023, Mr Burchell confirmed that he would pay a bill for cleaning products and send a Spark modem. He then wrote: “Then find out how to give a week rental discount. I’ll TX confirmation on week discount.” In a later text message dated 12 December 2023, after Mr Sim had terminated Mr Burchell’s appointment, Mr Burchell advised the tenant “Your bond total 455 x 4 = 1820 plus $455 that extra week.”
Mr Burchell also produced a statement of activity for the period 1.7.23 to
1.24. The statement shows receipt of the two weeks rent in advance; it also shows that the next rent payment of $455 was paid by the tenant on 20 September 2023 and was applied to the rent week commencing on 18 September 2023. Therefore, the statement tends to support his claim that rent was payable from 4 September 2023 and rent in advance was applied correctly to the first 2 weeks of the tenancy.
Mr Burchell also produced an invoice addressed to the tenant numbered 5846 and dated 2 August 2023. The invoice records the following entries and payments received: •Bond rental x4 that may be paid back if Owner has no claims on property after last inspection—$1,820 •2 Weeks upfront. One week used. Please pay rental the following week as per agreement from move in date—$910 •Key deposit—$60.00
The tenant advised that he had not been provided with a copy of this statement nor any of the invoices referred to in the statement during the tenancy. Mr Burchell confirmed that he only started this “invoicing system’ in November 2023, two months after the tenancy started. He accepts that the tenant would not have seen it.
I put to Mr Burchell that invoice 5846 acknowledges receipt of 2 weeks rent in advance but also says “one week used” which tends to support the tenant’s argument that Mr Burchell held onto one week’s rent without applying it to rent. Mr Burchell says that the wording on the invoice was a mistake. He also argues that the tenant made him believe an extra week’s rent had been paid which is why it is mentioned in his 12 December text, but he stands firm in his claim that no agreement to give a week’s free rent as compensation was made.
I am satisfied on the evidence that the tenancy agreement only provided for a bond equivalent to four week’s rent. That is also what the tenant paid, and the landlord received. In that regard, I do not find that the landlord has breached section 18(1) RTA by requiring a bond in excess of 4 week’s rent. I am also satisfied that the tenancy agreement provided for two week’s rent to be paid in advance which is the maximum advance permitted by section 23(1) RTA and it appears that Mr Burchell applied the rent in advance in the first 2 weeks of the tenancy, before the expiry of the period for which the rent was paid.
The real issue to determine is whether the landlord agreed to compensate the tenant by giving one week’s free rent. After carefully considering all the available evidence, I find that such an agreement was reached. The text messages from Mr Burchell and the first invoice recording 2 weeks rent in advance but only one week used, corroborate the tenant’s evidence. For that reason, Mr Burchell must pay the tenant one week’s rent as agreed compensation. However, the claim for exemplary damages for a breach of section 18(1) is dismissed. Bond refund
I am satisfied that a bond of $1,820 was paid to the landlord, or to an account operated by the landlord. The tenant provided proof of deposit and the landlord acknowledged receipt in the activity statement and invoice he generated several months after the tenancy started.
Section 22B RTA provides that if there is a dispute between the parties as to the payment of a bond, either party may apply to the Tribunal for an order determining to whom the bond, or any part of it is to be paid. Further, if a tenant applies to the Tribunal, and the landlord seeks payment of the bond in whole or part, the landlord must file an application with the Tribunal that sets out the landlord’s counterclaim.
Inexplicably, Mr Burchell filed a cross claim in the Tribunal on 12 February 2024 seeking rent arrears from 15 November 2023 to 17 January 2024 totalling $4,095. He has claimed rent accruing after his services were terminated by Mr Sim and after the tenancy had been terminated. Leading up to this he also sent the tenant several demands for rent arrears after his services were terminated by Mr Sim. Mr Sim confirmed that the tenant paid Mr Sim the rent due for the premises from 15 November 2023 onwards and that he is not in arrears at all.
Mr Burchell acknowledged at the hearing that he should withdraw his claim for rent arrears. When I asked on what basis he sought rent arrears from the tenant after his appointment as property manager was terminated, he said that Mr Sim did not give a proper cut off date and he could not do a proper accounting. He also said that Mr Sim owed him money and agreed to pay back bonds to tenants to reduce the debt owed, a claim that Mr Sim absolutely denies. Mr Sim also alleges that Mr Burchell has failed to provide any records regarding premises and tenancies he was managing for Mr Sim and has failed to provide a proper accounting for rent less commission received. It appears that there is considerable dispute between them. However, as explained at the hearing, the dispute between owner/agent is not the tenant’s problem and is not within this Tribunal’s jurisdiction. I do not find Mr Burchell’s explanation for seeking rent arrears from the tenant credible and his concerted attempts to continue to collect rent from the tenant after Mr Sim terminated his services are concerning.
Mr Burchell went on to say that the bond must be refunded to the tenant and that he and Mr Sim must agree how it should be paid suggesting at one stage that they pay half each. Mr Sim rejected that proposal noting Mr Burchell’s advice at the hearing that the bond was paid into a “trust account” he operated. Therefore, he should refund the amount. Mr Sim emphasized that he was to be a “hands-off” owner and Mr Burchell was to be responsible for all aspects of tenanting the premises and managing those tenancies.
I agree with Mr Sim that Mr Burchell must refund the bond money. Given my finding that Mr Burchell was the landlord and the correct respondent in respect of the tenant’s claims, it follows that I make an order for Mr Burchell to refund the bond in full, which he collected and held in an account he operates.
It also follows that Mr Burchell’s claim for rent arrears has no merit, and his cross application must be dismissed. Exemplary damages for failing to lodge the bond
Under section 19(1) RTA, a landlord must send any bond payment to the Bond Centre within 23 working days after it is received. Breaching this obligation is an unlawful act for which the Tribunal may award exemplary damages up to a maximum of $1,500.00. See section 19(2) and Schedule 1A RTA.
I am satisfied that the landlord did not lodge the bond with the Bond Centre as required and has committed an unlawful act in that regard.
The tenant seeks an award of exemplary damages. Exemplary damages are designed to punish and to deter. They are like a fine. In Auckland City Council v Blundell [1986] NZLR 732 the Court of Appeal (Cooke P) said: Exemplary and punitive [damages] are different words for the same thing. The damages are exemplary because they are meant to teach an example to the guilty officer and others. They are punitive because they are meant to punish. They are like a fine, though they go to the citizen who has been the victim of conduct.
Exemplary damages are awarded at the Tribunal’s discretion when one party has proved that the other party has committed a defined unlawful act. If that is proven, and before the Tribunal may award exemplary damages, it must take account of the factors set out in section 109 RTA.
Exemplary damages can be awarded if the unlawful act was committed intentionally, and having regard to: a. The intent of the person committing the unlawful act; b. The effect of the unlawful act; c. The interests of the landlord or tenant against whom the unlawful act was committed; d. The public interest; and e. Whether it is just to make the award.
The District Court has said the requirement of intention is not about whether the party was aware they were breaching the Act. Rather, it is about whether they acted intentionally i.e. whether they intended to do whatever it was they did or did not do (Parton v Fifita TT 1815/00, DC Auckland,1/5/2001).
Taking into account the section 109 factors I make the following findings.
The landlord’s decision not to lodge the bond with the Bond Centre was intentional. It is prefaced in the tenancy agreement where it says on page 2: “Four-week deposit/Bond will be retained for the Guest...” and on page 6: “Deposits will only be refunded once notice from the Court Order is received.” It is also prefaced in the mandate with Mr Sim where it says on page 3: “Four weeks deposit money will be retained by The Guest Home on behalf of the Guest because the Agreement is a flatting agreement.”
Mr Burchell claims that he understood that this was a flatmate agreement or emergency/transient accommodation such that the tenancy was excluded from the jurisdiction of the RTA and the requirement to lodge bonds with the Bond Centre. However, this Tribunal has already found that this tenancy is within the jurisdiction of the Tribunal under the RTA and Mr Burchell did not attend the hearing to prove otherwise.
I also put to Mr Burchell, that this is not the first time he has failed to lodge a bond in similar circumstances. I referred him to a previous decision of the Tribunal under application 4368540 dated 20 January 2023. In that case, The Chief Executive, Ministry of Business, Innovation and Employment (MBIE), acting in place of a tenant, brought an application against Mr Burchell and obtained an award of exemplary damages against him for (amongst other things) failing to lodge a bond with the Bond Centre in almost identical circumstances as exist here (the MBIE case). In the MBIE case, Mr Burchell was found to be the landlord, acting as agent for owners of a property. He entered an agreement with a tenant to rent a room in the property on terms very similar to the agreement in this case. The agreement was couched as a “flatmate agreement” despite the fact that Mr Burchell did not live at the premises. The Tribunal rejected arguments that the tenancy was excluded from the Tribunal’s jurisdiction under the section 5 RTA exclusions either on the basis of a flatmate arrangement (s5(1)(n) exclusion) or because the premises were being used for emergency/transient housing (s5(1)(y) exclusion). A later rehearing application brought by Mr Burchell against that Tribunal order was dismissed in an order dated 21 July 2023.
Mr Burchell submitted that he believes the MBIE decision is wrong and that he can prove the premises in that case were being used for emergency/transient accommodation. He is considering an appeal out of time.
Despite Mr Burchell’s submissions, I am not persuaded and do not accept that he believed this tenancy was not covered by the RTA. At the very least, given the MBIE case against him, he should be on notice that he cannot claim a “flatmate” situation when he does not live at the premises. However, the tenancy agreement is couched in those terms stating on page 2: “You fall under the flatmate legislation not within the Residential Tenancy Act.” The tenancy agreement makes no mention of being emergency/transient accommodation which you might expect the landlord to also include if he wanted to make clear that the RTA does not apply for that reason.
In summary, despite the previous MBIE case and the exemplary damages awarded against him, Mr Burchell proceeded to arrange this tenancy using an agreement containing very similar terms and has again failed to lodge the Bond with the Bond Centre. This indicates a complete disregard for the law and deliberate intent to evade the requirements of the bond regime again.
The effect of the unlawful act is that the landlord now holds funds that belong to the tenant, which the landlord has no lawful authority to hold. Not only that, but by refusing to lodge the bond, and then refusing to refund the bond at the end of the tenancy, the landlord has denied the tenant of his right to the funds.
There is a very strong interest for landlords, tenants and the public generally, to have a robust bond system which keeps bond money secure. This is defeated when landlords do not comply with their obligations to lodge bonds.
In summary, I consider an award of exemplary damages is justified. The maximum level of exemplary damages that can be awarded is $1,500. I award $1,200 which is at the higher end of the scale and 80% of the maximum. This is because I consider the landlord has deliberately set about to evade his obligations. The situation is aggravated by the fact that this is not the first time he has committed this unlawful act as he has already been censured for the same behaviour in the MBIE case. It is also aggravated by the fact that he steadfastly refused to refund the bond to the tenant when asked to do so, and he had no grounds for refusing to do so. Requiring security other than a bond
Under section 18A(1) RTA, a landlord may not require a tenant to provide any form of security for the tenancy other than a bond or a guarantee. Breaching this obligation is an unlawful act for which the Tribunal may award exemplary damages up to a maximum of $1,500.00 under s18A(2) and Schedule 1A RTA.
The landlord required the tenant to pay $60 as a key deposit in breach of s18A(1). I find the landlord has committed an unlawful act.
Taking the s109 considerations into account, I conclude as follows. a. It is very likely that the landlord’s actions were intentional; b. The landlord has drafted a tenancy agreement which includes provision for a key deposit in breach of the RTA. This is an active attempt to evade his obligations under the RTA. As set out above, the landlord knew or ought to know that this was not a flatmate arrangement as the agreement purports, and if he held any genuine doubts about the application of the RTA, the MBIE case against him should have settled the question. c. There is a very strong interest for landlords, tenants and the public generally, that the protections in the RTA are not interfered with, which includes misleading tenants about their rights and obtaining unlawful payments; d. It would be just to make an award of exemplary damages.
The maximum level of exemplary damages that can be awarded is $1,500. I award 33% of the maximum being $500. I take into account that the deposit charged was a relatively small amount but the landlord did not refund the key deposit immediately after the tenancy ended.
It follows that the key deposit of $60 must also be refunded by the landlord to the tenant.
The landlord should now be firmly on notice that any similar breaches in future will likely attract exemplary damages at the higher end of the scale because he now has a history of non-compliance with the RTA. Suppression and filing fee
As the tenant has substantially succeeded with his application, he is entitled to suppression of his name and identifying details and reimbursement of the filing fee, as requested. As Mr Birchall has not succeeded in the proceedings, he is not entitled to suppression of his details, as requested.
The second respondent also requested suppression. While, the second respondent has not been found liable for the tenant’s claims, I consider that there is public interest in publishing the address of the premises to which these claims relate, and publication of the address will enable the owner’s name to be discovered. The public interest factor is to alert other tenants of the premises who may have similar claims they wish to pursue. I also consider that there is public interest in knowing who appointed the first respondent to operate the premises. For those reasons, suppression is declined.

Tenancy Tribunal case 4769800 — Exemplary damages at Room 5, 10 Elizabeth Street, Petone, Lower Hutt 5012

At a glance

Tenancy Tribunal case 4769800 — Exemplary damages at Room 5, 10 Elizabeth Street, Petone, Lower Hutt 5012

At a glance

Award balance

Claims & awards

Dismissed claims

Order

Reasons

Who is the correct respondent?

Topics & place

Residential Tenancies Act sections

Key findings

Frequently asked questions

Award balance

Claims & awards

Dismissed claims

Order

Reasons

Who is the correct respondent?

Topics & place

Residential Tenancies Act sections

Key findings

Frequently asked questions