Published tribunal order
Tenancy Tribunal case 4771637 — Exemplary damages at 47 Cameron Way, Makarau, RD 3, Warkworth 0873
Decided 17 Jul 2024 · Published 17 Jul 2024 · Application 4771637
- Exemplary damages
Order
- [The landlord/s] must pay [The tenant/s] and [The party] $3,720.44 immediately, calculated as shown in table below: LandlordTenant Compensation: loss of enjoyment and stress associated with termination of tenancy $1,500.00 Exemplary damages: retaliatory notice by landlord Exemplary damages: failure to provide signed tenancy agreement at start of tenancy Filing fee reimbursement $2,000.00
- 00
- 44 Total award $3,500.00 Total payable by Landlord to Tenant $3,720.44
- The tenancy declares that the landlord’s notice to terminate the tenancy was a retaliatory notice.
- The Bond Centre is to pay the bond of $2,800.00 (6271382-003) to [The tenant/s] and [The tenant/s] immediately.
- The tenants’ claims for the purchase price of their caravan and for a refund of the rent they paid are withdrawn.
- The tenants’ application for a rent refund on their new tenancy is dismissed.
- The landlord’s application is dismissed.
Reasons
- Both parties attended the hearing on 16 July 2024. Mrs Roberts said she was representing her husband, the sole named tenant. The Tribunal would also regard her as a tenant as she lived with her husband at the premises. I have named her as a tenant applicant.
- The landlord is currently overseas. Ms Carter represented her. Background
- The tenancy started on 8 November 2023 and ended on 4 February 2024. There was some minor date discrepancy about the start date especially. I am satisfied that the dates I have recorded are the correct dates from the documents provided.
- 20 days after the tenancy started the landlord gave the tenants 90-days’ notice to terminate the tenancy because substantial repairs were going to be carried out and it would not be reasonably practicable for the tenants to remain at the premises.
- The premises comprise a home relocated to the site about 4 years ago together with a separate garage area that has been partly converted to a separate accommodation area, akin to a large sleepout with some facilities.
- The landlord did not comply with her obligations at the start of the tenancy. She did not provide a tenancy agreement with the required information as set out in sections 13 and 13A of the Residential Tenancies Act 1986 (RTA).
- When the landlord did provide a tenancy agreement on or about 26 November, 2 copies were prepared. One records a periodic tenancy starting on 8 November 2023; the other a tenancy undefined that started on 6 November 2023. Both agreements are signed by the parties.
- By then, the relationship between the parties had soured and contention arose about the landlord having access to undertake repairs to the kitchen/dining room ceiling.
- The tenants had suggested a 2-week period when they would be away between 14 December 2024 and 3 November 2024 for the repairs to be done. The landlord insisted the repairs be done over the weekend of 24 to 26 November, and that is what happened. She arrived, with her brother, a builder, to do the ceiling repairs.
- Soon after that weekend, the landlord served a 90-day notice on the tenants dated 28 November 2023. The tenants say the notice was in retaliation for the contention that arose that weekend, with them refusing access to the premises on the Sunday when they planned to be away.
- The landlord says there was no connection. And the substantial work referred to was not the replacement of the kitchen/dining room ceiling, but other ceilings in the premises which had started to sag.
- After the tenants received the landlord’s notice to terminate the tenancy, they located another tenancy. It comprises a commercial packing shed. They reside in a caravan near the commercial premises.
- The tenants gave 28 days’ notice to end the tenancy. But they relocated to their new tenancy premises on 20 January 2024. Issues
- The tenants have claimed: •A refund of rent they paid on their new tenancy (referred to as industrial landlord lease) for the period 20 January 2024 to the date they made their application ($6,400.00). •A declaration that the landlord’s notice to terminate the tenancy was retaliatory notice. •Exemplary damages for the landlord’s retaliatory notice. •The purchase price of their caravan ($60,200.00). •Relocation costs (petrol, vehicle hire, pet care) moving to this tenancy from Ruakaka, and then moving to their new tenancy in Rotorua ($10,116.50). •A refund of rent ($8,400.00) paid. •Compensation for emotional stress and discrimination.
- The landlord has claimed: •Rent arrears ($700.00). •Carpet replacement ($885.50 for bedroom 2) and installation. •The replacement cost of a door handle ($148.89). •Replacement cost of light fittings ($85.50) and installation. •Builder’s time for day when tenants would not allow access. •Reimburse landlord’s lost wages – 1 day (320.00). •Curtain replacement ($1,320.00). Relevant legal principles Compensation and exemplary damages
- The Tribunal may award compensation to a tenant for losses arising from a proven breach or breaches by the landlord of their statutory responsibilities. Compensation is generally awarded for actual losses and sometimes for less tangible effects of proven breaches such as a loss of enjoyment of the tenancy and the accompanying stress and anxiety. The tenant’s compensation claims are for actual losses and for the emotional distress associated with the landlord’s actions, undertaking repairs without their consent, and terminating the tenancy.
- In Birch v Otautahi Community Housing Trust [2020] NZDC 17667 the District Court confirmed that the Tribunal must consider the following factors when deciding to award compensation: • The nature of the breach; • The duration of the breach; and • The effect of the breach on the party.
- Exemplary damages are different. They 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.
- In Birch the Court said this: In considering whether an order of exemplary damages should be made, the Tribunal must first look at the intention of the person against whom the order is sought. As the Tribunal in Chief Executive, ex parte Edmondson v Walls TT548/92 said: Before an award of exemplary damages can be made the threshold question for the Tribunal to answer is whether the unlawful act has been committed ‘intentionally’. In my view negligence does not equate to intention, and for the Tribunal to be satisfied that a party has ‘intentionally’ committed an unlawful act evidence must exist which would justify the Tribunal in coming to the conclusion that the party committing the unlawful act has in fact turned his or her mind to the act and deliberately set about to commit it. If the Tribunal considers that the person against whom the order is sought has committed the unlawful act intentionally, the Tribunal must then consider whether it would be just to require that person to pay exemplary damages, taking into account: (a) The intention of the person (b) The effect of the unlawful act; (c) The interests of the party against whom the unlawful act was committed; and (d) The public interest. Retaliatory notice
- Section 54 RTA provides:
- Tribunal may declare retaliatory notice of no effect (1) Within 28 working days after receipt of a notice terminating the tenancy, being a notice that complies with the requirements of section 51 (or, in the case of a boarding house tenancy, section 66U), the tenant may apply to the Tribunal for an order declaring that the notice is of no effect on the ground that, in giving the notice, the landlord was motivated wholly or partly by the exercise or proposed exercise by the tenant of any right, power, authority, or remedy conferred on the tenant by the tenancy agreement or by this or any other Act or any complaint by the tenant against the landlord relating to the tenancy. (2) If, on any such application, the Tribunal is satisfied that the landlord was so motivated in giving the notice, it shall declare the notice to be of no effect unless the Tribunal is satisfied that the purported exercise by the tenant of any such right, power, authority, or remedy, or the making by the tenant of any such complaint, was or would be vexatious or frivolous to such an extent that the landlord was justified in giving the notice. (3) The giving of a notice terminating a tenancy is an unlawful act if the notice is declared under subsection (2) to be of no effect. Provisions relating to a tenancy agreement
- Section 13 RTA provides: Tenancy agreement must be in writing and signed (1) The landlord must ensure that the tenancy agreement is in writing. (2) The landlord must, before the tenancy commences,— (a) sign the tenancy agreement; and (b) provide a copy of the tenancy agreement to the tenant (whether or not the tenant has signed it). (3) The tenant must sign the tenancy agreement. (4) A landlord who fails to comply with subsection (1) or (2)— (a) commits an unlawful act; and (b) commits an infringement offence and is liable to a fine or an infringement fee specified in Schedule 1B. Landlord responsibilities at start of tenancy
- Section 45 RTA provides in part: Landlord’s responsibilities (1) The landlord shall— (a) provide the premises in a reasonable state of cleanliness; and (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; and Analysis of tenants’ claims
- The tenants withdrew their claims for the purchase price of their caravan and for a refund of the rent they paid. A refund of rent for the new tenancy (referred to as industrial landlord lease) for the period 20 January to the date of application
- I dismiss this claim. There is no basis in law for the Tribunal to award the tenants a rent refund for their new tenancy. They gave proper notice to end their tenancy with this landlord. Although there was confusion about the start date of the tenancy due to the 2 separate agreements, it was never stated to be a fixed term tenancy (even if that is what the tenants wanted).
- The tenants knew that the tenancy was a periodic tenancy, and they gave appropriate notice to end the tenancy on that basis. That they chose to relocate before the end of their notice period does not relieve them of their obligation to pay rent. Nor does it justify a claim for the rent they paid on their new tenancy. Was the landlord’s notice to terminate the tenancy a retaliatory notice?
- I find that the landlord’s notice to terminate the tenancy was given in retaliation for the events that occurred over the weekend of 24-26 November 2023.
- The tenants gave evidence that they objected to the landlord undertaking the removal and replacement of the kitchen/dining room ceiling then. They had offered the period from 14 December 2023 to early January 2024 when they planned to be away. Despite that, the landlord insisted on doing the work then. The landlord’s brother, a builder, did the work, late into the night of 25 November, creating mess and dust, and disruption.
- The tenants gave evidence that they refused to allow the landlord the opportunity to finish the work the following day as they were not going to be home. They said the landlord told them words to the effect ‘I was going to lower your rent, but not now’ and ‘I don’t think I want you as tenants’.
- The notice to terminate the tenancy followed a couple of days later, on 28 November 2023.
- Ms Carter said the landlord became aware that further renovation work was needed to relace other ceilings at the premises, substantial work that required the premises to be empty, work that had since been done.
- I do not accept that. First, it would have been obvious to the landlord what work was needed when the tenancy started. The tenancy was terminated just 20 days after it started.
- Second, the notice followed the tenants’ unwillingness to provide access on the Sunday, after the work they did not consent to had gone on late into the Saturday night. The relationship between the parties had deteriorated by then.
- And third, there was an alternative accommodation area available to the tenants that could have been utilised while the additional work was carried out. That work did not magically manifest itself during the 20-day period from the start of the tenancy. Exemplary damages for the landlord’s retaliatory notice
- A notice declared to be retaliatory constitutes an unlawful act. Here I find that the landlord acted with intent. She had had enough of these tenants and wanted them gone. The notice to terminate the tenancy had a significant effect on the tenants and was against their interests. They had to quickly find a new tenancy and move once more, having only recently relocated. And it is against the public interest for landlords to act in this way.
- I award the tenants exemplary damages of $2,000.00 for this unlawful act. Relocation costs (petrol, vehicle hire, pet care) moving to this tenancy from Ruakaka and then moving to their new tenancy in Rotorua ($10,116.50)
- I dismiss this part of the tenants’ application. Once the landlord gave notice, they could have applied to the Tribunal to set aside the notice on the basis that it was retaliatory and of no effect.
- The tenants gave notice to end the tenancy and they found another tenancy. What occurred caused them stress and emotional harm which I will address later. They cannot claim their relocation costs to take up this tenancy. Nor can they claim their costs to move to another tenancy when they decided to end this tenancy by notice. Compensation for emotional stress and discrimination
- The landlord’s action terminating the tenancy so soon after it started caused the tenants great emotional distress, cost, and inconvenience. Landlords sometimes underestimate just how difficult and stressful it is finding and relocating to another tenancy premises.
- I accept the tenants’ evidence about the emotional effects and the stress they experienced. I must take account of the factors outlines by the Court in Birch. The time frame involved was short, but the effects on them were significant. Fortunately, they were able to quickly find another tenancy.
- I award the tenants compensation of $1,500.00 for the stress and emotional harm suffered because of the landlord’s actions. Analysis of the landlord’s claims Rent arrears ($700.00)
- The landlord’s rent summary shows rent arrears of $700.00. However, I accept the tenants’ evidence that the first 2 weeks were provided in effect ‘rent free’ so they could do necessary cleaning. Rent ran from 13 November 2023. On that basis, the landlord probably owes the tenants a refund of $100.00. They did not pursue that. Carpet replacement ($885.50 for bedroom 2) and installation
- Ms Carter said the carpet in bedroom 2 smelt of animal urine and had to be replaced. The carpet was about 4 years old. There is an invoice for the carpet but not for the installation cost.
- The tenants said the carpet was worn and smelt of mould because water leaked inside from a window that would not close properly. They said they tried to remove the odour and staining with a Rug Doctor during the first couple of weeks but to no avail.
- The landlord did not attend and give evidence. Ms Carter could not give direct evidence about this issue. There is no reason why I should not accept the tenants’ evidence about the existing mouldy smell in the carpet. I dismiss this part of the application. The replacement cost of a door handle ($148.89)
- Ms Carter produced a photo of the ranch slider door handle that had come off the door and had to be replaced.
- The tenants said the handle was loose at the start of the tenancy and just fell off. The Tribunal regards this as a landlord maintenance issue. The claim is dismissed. Replacement cost of light fittings ($85.50) and installation
- The landlord replaced 2 light fittings, one of which Mrs Roberts damaged and the other so it would match the replaced fitting.
- Mrs Roberts gave evidence that the damage occurred on the night when the builder was repairing the kitchen ceiling and the fridge was being moved. There was no light (he was wearing a pen torch) and she fell into the light fitting while passing him a better light.
- The Tribunal would regard this as inadvertent damage, rather than careless damage. The claim is dismissed. Builder’s time for day when tenants would not allow access
- The tenant’s refusal to allow further access for repairs on the Sunday when they were not going to be home (especially when they had agreed to a 2-week period for repair work in December) was not objectively unreasonable. I dismiss this claim. The builder was the landlord’s brother. No evidence such as an invoice was produced in evidence to support the claim that the landlord incurred this loss. Reimburse landlord’s lost wages – 1 day ($320.00)
- I dismiss this claim. This application illustrates the difficulties that arise when a landlord is an absentee landlord. That the landlord resides in Napier meant that she had to take time off to visit the premises with her brother to do the repair work which the tenants did not consent to. As they put it, they got 4 days’ notice to do a 4-day renovation. They did not consent to that and their refusal to consent was not unreasonable. This is a loss the landlord must bear. Curtain replacement ($1,320.00)
- Ms Carter said curtains at the premises had been taken down, washed, and folded which caused them to stick together. She did not know the age of the curtains nor whether the landlord had insurance for such a loss.
- Ms Carter referred to the property inspection report. However, the tenants said there was another inspection report that had not been produced. Given that there was more than 1 tenancy agreement with terms that conflict, I accept that there might well have been another property inspection report as well.
- Mrs Roberts said she did not wash the curtains. She took them down because they were stuck together with wasp and spider nests and were soiled. She said she put them in the garage as the landlord told her to.
- Again, there is no reason why I should not accept the tenants’ evidence. Ms Carter was unable to give direct evidence about the curtains. She could only refer to the communications between the parties, and the property inspection report.
- Even if I had found the tenants liable for this damage, without evidence about the age of the curtains and whether the landlord had any insurance for such a loss, and if so, what the excess on the policy was, I could not have quantified appropriate compensation. This claim is therefore dismissed. Result
- The landlord will pay the tenants $3,720.44 including the filing fee on the tenants’ successful application.
- The bond will be paid to the tenants in full. Name suppression
- On my enquiry, neither party sought a name suppression order.