Published tribunal order
Tenancy Tribunal case 4834988 — Exemplary damages at Apartment 1E, 193 Main Highway, Ellerslie, Auckland 1051
Decided 24 May 2024 · Published 24 May 2024 · Application 4834988
Tenant favoured
- Exemplary damages
- Compensation
Order
- The term of the fixed-term tenancy of Hong Chang and Yunli Wang at Unit 1E, 193 Main Highway, Ellerslie, Auckland 1051 is reduced and now ends at the end of 19 June 2024.
- Investment Citi Limited as agent for Richard & Jane Powell must pay Hong Chang and Yunli Wang $4,060.44 immediately, calculated as shown in the table below.
- The tenants are to cooperate with Tony Spelman of One Tree Hill Properties Limited and permit access to the unit at reasonable times for prospective tenants to view the premises. DescriptionTenant Compensation for emotional harm for unlawful entry Loss of amenity $4,000.00 $40.00 Filing fee reimbursement$20.44 Total award$4,060.44
Reasons
- Hong Chang attended the hearing for both the tenants. Mr Wang is Ms Chang’s husband. She was assisted by a Mandarin interpreter.
- Precious Onwukwe attended for Investment Citi Limited.
- During the hearing, the Tribunal telephoned the new landlord’s authorised person, Tony Spelman of One Tree Hill Properties, who kindly engaged in the hearing by telephone.
- The tenants claim Mr and Mrs Powell entered the premises unlawfully and removed chattels without permission. They apply for an order for early termination of their fixed-term tenancy. For remedies, they seek compensation and exemplary damages. Background
- The tenancy was for a fixed term beginning on 24 July 2023 and ending on 24 July 2024.
- The premises apartment was tastefully furnished with furniture, rugs, and artwork, which made the unit particularly attractive to the tenants. Because the chattels came with the apartment, the tenants had to dispose of some of their own chattels when they moved in.
- The previous landlords entered the apartment without the tenants’ knowledge while the tenants were away in China. 1
- Prior to the entry, on 5 March 2024, Ms Onwukwe emailed the tenants a notice that the landlords wanted to come to the apartment to remove a teak dresser: Hope all is well. The owner has asked if it okay to come to the apartment and remove the Teak Dresser from the kitchen area on Friday, March 8 th , between 10:30 am and 11:30 am. If you won’t be home, the owner has a spare key and can go in to remove the dresser, as it was not included as part of the furnishings for the unit and belongs to the landlord.
- The tenants did not see the email at the time because they were still in China and the Chinese government blocks Western electronic communications.
- Despite getting no response from the tenants, on 7 March 2024, Ms Onwukwe emailed the tenants that the landlords would unilaterally enter the apartment to remove the dresser: 1 The tenants were overseas between 15 January 2024 to 12 March 2024. As we have not received any response the owner will go through the apartment on Friday between 10:30 am and 1:30 am to remove the dresser. Please let me now if you have any questions.
- On 12 March 2023, the tenants returned to the unit and were horrified to discover that someone has been into the unit moved some of their items and taken various items. At first, they thought the unit had been burgled and contacted the Police. Once they realised there had been no forced entry and checked their emails they emailed Ms Onwukwe: I came home today and found that all the hanging paintings were gone and the kitchen was in a mess. When I rented the house, I was given a detailed schedule, but now a lot of things are missing. I haven’t been able to receive mail since I was abroad, and things were moved without my permission. Please give me a reasonable explanation or I will call the police. I don’t know what happened.
- On 13 March 2024, the tenants emailed: I was really shocked, angry, scared...They come and move things without my permission and mess up my stuff.
- And: I was shocked as soon as I came back. It was all in a mess. All the paintings on the wall were gone, leaving only a pile of nails. If you had shown me a house like this, I would not pay $640 to rent this house.
- Ms Onwukwe responded: I’ve talked to the landlord about the items that were removed, like the painting and shelf. The landlord has agreed to replace them with similar items for the apartment. We can organize this replacement as soon as possible.
- The tenants replied: I don’t need to replace anything. The point of the problem now is that he came in to move things without permission. Replacing the item will not solve the current problem.
- On 14 March 2024, Ms Onwukwe forwarded the landlord’s message apologising for removing the items which they “considered our property which were in addition to the Teak Dresser” and were “sentimental pieces”. The landlord offered to return all the items other than the Teak dresser being: o One rug. o A small bookcase. o Three wall artworks.
- On 18 March 2024, the tenants emailed that they rejected the offer: I don’t agree with this solution. He came in and moved things without my permission, and also moved a lot of things that were not included in the email, which frightened me, and he did not admit this behaviour was not allowed. Now I worry every day when he will come to move things out again. I am going to take this matter through the Tenancy Tribunal and I want to know if is legal for the landlord to do this.
- The issues for the Tribunal to determine are: a. Did the landlord unlawfully enter the premises? And if so, what remedies should be ordered? b. Should the term of the fixed-term tenancy be reduced?
Did the landlord unlawfully enter the premises?
Legal principles
- A landlord may not enter the premises during the tenancy except with the tenant's consent, in an emergency, or after giving the required notice for inspections and repairs and maintenance. 2
- Breaching this obligation is an unlawful act for which exemplary damages may be awarded up to a maximum of $1,500.00. 3
- At hearing, Ms Onwukwe submitted the landlords considered an emergency justified the entry.
- “Emergency” means: 4 A serious, unexpected, and often dangerous situation requiring immediate action.
- In this case, “emergency” is to be interpreted in the context of the tenants’ quiet enjoyment rights under s 38 of the Residential Tenancies Act 1986 (RTA) which provides: 38 Quiet enjoyment (1) The tenant shall be entitled to have quiet enjoyment of the premises without interruption by the landlord or any person claiming by, through, or under the landlord or having superior title to that of the landlord. (2) The landlord shall not cause or permit any interference with the reasonable peace, comfort, or privacy of the tenant in the use of the premises by the tenant. 2 Residential Tenancies Act 1986 (RTA), s 48(1) and (2). 3 RTA, s 48 (4)(a) and Schedule 1A. 4 Judy Pearsall The New Oxford Dictionary of English (Clarendon Press, Oxford, United States, 1998)
- In a previous case, the Tribunal held that a landlord who had Dog Control enter the tenancy premises to retrieve dogs the tenant left uncared for due to being detained in a mental health facility could rely on the emergency exception. 5 The landlord’s taking possession of the premises and removing the tenant’s possessions were not justified by it being an emergency, however. Discussion
- The male landlord, Mr Powell, was unavailable to give evidence today due to illness. Ms Powell did not attend the Tribunal either.
- Ms Onwukwe explained that the landlords’ daughter has a serious illness. Her doctors advised the landlords that their daughter’s wellbeing would be helped by having her personal belongings around her. The landlord’s daughter had a special past relationship with the chattels the landlords took and were “just what the doctor ordered”.
- The tenants say the landlords never gave them that explanation for the intrusion. Ms Chang heard it for the first time at the hearing.
- Ms Onwukwe did not provide any documentary evidence of the landlords’ daughter’s condition or the doctors’ advice. However, Ms Onwukwe confirms the landlords mentioned their daughter’s health problems at the outset and they gave her the current explanation for wanting to go into the apartment to remove items.
- Ms Onwukwe says she advised the landlords of the law, and it was them who decided the circumstances were an “emergency” that permitted their entry.
- The Tribunal sympathises with the landlords’ plight. Little could be more distressing to a parent than to experiencing their child’s suffering. However, the evidence does not satisfy me that recovering these particular items was by entering the premises without permission and taking the items without permission was necessary due to an emergency.
- Ms Onwukwe emailed the tenants three days before the entry that the landlords wanted to retrieve dresser. There was not an emergency at that time given the landlords could wait for three days. Nor did the evidence show that an urgent situation would arise at the end of the three days.
- Ms Onwukwe’s emails to the tenants do not mention emergency whatsoever or any other proper reason for entry. Moreover, the emails only mention the dresser, not the other items the landlords took. 5 Haslam v Tandem Realty Ltd t/a Harcourts [2012] NZTT North Shore 11/01624.
- The landlords could have provided the explanation they gave at the hearing to the tenants earlier, but they did not. That suggests that while the circumstances naturally weighed heavily on the landlords, there was not truly an emergency. Otherwise, the landlords - if as hope they valued the tenant’s reasonable privacy - could be expected to have conveyed the extremity of their situation.
- The fact that the landlords did not tell Ms Onwukwe they would take the artworks and the carpet is not consistent with an “emergency”. Otherwise, the necessity to collect those items would have been identified in advance.
- Further, even if collecting the dresser could be justified by the emergency exception, the integrity of the purported emergency ground was compromised by the landlords exceeding the terms of the (invalid) notice they gave the tenants.
- Nor is there any medical evidence that recovering any of these particular items was essential. When a person is unwell, there may be many things that would benefit their recovery or ease their suffering. Some things will be more essential than others. The landlords’ daughter having the chattels around her may have been beneficial, but it has not been shown that these particular items were essential or incapable of substitution or that time was of the essence. Conclusion
- Therefore, the landlord’s entry was not justified due to an emergency.
- It follows, the landlords’ entry on 8 March 2024 was unlawful.
- I now consider what remedies should be ordered. Remedies
- Ms Chang says that she arrived back to “chaos”. She thought the apartment had been burgled. She felt frightened and unsafe. Her husband was “furious”.
- Afterwards, Ms Chang says she felt insecure in the unit because the previous landlords never fully acknowledged they were wrong. She felt that the landlords might enter the premises again at any time, interfere with their belongings, and remove chattels. She says she has suffered sleep problems and believes it has led to her having swollen lymph nodes.
- I am satisfied the tenants suffered significant emotional harm due to the landlords’ unlawful entry and therefore that general damages are warranted.
- The Tribunal in Palmer v Housing New Zealand (No 2) 6 held that when assessing the quantum of general damages, the Tribunal must consider the following factors: a. The nature of the breach; b. The duration of the breach; and c. The effect of the breach on the party.
- Recently, the Tribunal’s power to award compensation was increased from $50,000.00 to $100,000.00 by s 50 of the Residential Tenancies Amendment Act 2020, which means the Tribunal’s orders for general damages can range as high as $100,000.00 if such harm is proven.
- The Tribunal’s general damages awards have historically been low. In Birch v Otautahi Community Housing R E Neave DCJ described the Tribunal’s awards for emotional harm damages as “not particularly generous” and “fairly conservative”. 7 In the case before His Honour, the tenant had returned to her unit and found contractors had entered without her permission. Contractors had done asbestos repair work in the tenant’s unit and the landlord had mistakenly failed to give the tenant appropriate notice of the entry.
- His Honour found the Tribunal’s award of $200.00 of emotional harm damages for the unlawful entry was “close to being derisory”. He substituted an award of in the sum of $2,000.00 finding “it was a significant intrusion on [the tenant’s] rights”.
- In a recent case in the District Court, Judge David J Clark found in the assessment of general damages: 8 [69] Ultimately any assessment of damages will be based on all the circumstances of the case including (but not intending to make a prescriptive list) the intentions of the landlord; whether there was a lawful purpose which sat behind the conduct; the conduct of the tenant; the effect on the tenant; whether the conduct was ongoing, whether there were any aggravating or mitigating factors from both the landlord or tenant.
- In this case, the landlords’ pressing need to help their suffering child drove their conduct.
- The breach was based on an incorrect assessment that the “emergency” exception applied.
- The tenants’ conduct was blameless.
- The unlawful entry occurred on one occasion; the conduct was not ongoing. 6 Palmer v Housing New Zealand (No 2) Auckland TT 2378/92, 25 August 1993. 7 Birch v Otautahi Community Housing [2020] NZDC 17667. 8 Sun v Kang [2023] NZDC 24786
- The landlords tried to obtain the tenants’ consent, which does indicate a degree of consideration to the tenants. Afterwards, the landlords apologised and offered to make amends.
- I consider the harm to the tenants in this case is greater than Otautahi. In that case it would have been obvious to the tenant that contractors had been into the unit to do work. In this case, the tenants were initially unaware who had been into the apartment and why. They continued to feel uncomfortable in the premises. The landlords did not admit they acted unlawfully or give any acceptable reasons for why they had intruded as they did. As a result, they worried the same thing might recur.
- I quantify general damages for the harm suffered at $4,000.00 in this case.
- I accept the tenants’ suffered loss of amenity which I set at $40.00 per week. The relevant time period is from 12 March 2024 when the tenants returned from overseas to 18 March 2024, when they rejected the landlords’ offer to substantially replace the items. Parties have a duty to mitigate their loss. If the landlords had accepted the landlord’s offer to replace the items, their loss of amenity would probably have been largely if not wholly mitigated.
- I now consider whether the Tribunal should order exemplary damages.
- 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. 9
- The landlords committed the unlawful act intentionally, even if they did so by mistaking the law.
- 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: s 109(3) of the RTA.
- Exemplary damages are designed to punish and to deter. 10 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. 9 RTA, s 109(3). 10 See for example, Gao, Jeyasingham v Landlord [2022] NZTT 4329775, 4328263 para 61 ffg.
- In deciding whether it is just to make an award, I have considered: a. the landlord’s intent; b. the effect of the unlawful entry; c. the interests of the tenant; and d. the public interest.
- I have decided it would be unjust to order exemplary damages in this case.
- I accept the landlords’ entry was for the emotionally powerful reason of helping their suffering daughter.
- The tenants will be compensated for the emotional harm they endured.
- The entry, while unlawful, was not surreptitious: the landlords emailed the tenants to tell them about it.
- The public interest does not call for punishment where a landlord has fallen into error in distressing circumstances like these. Should the fixed-term tenancy’s term be reduced?
- The tenants sought reduction of the fixed-term tenancy due to end on 24 July 2024.
- The Tribunal may reduce a fixed term tenancy where: a. there has been an unforeseen change in the applicant’s circumstances; and b. there would be severe hardship to the applicant if the term is not reduced; and c. the applicant’s hardship would be greater than the hardship to the other party if the term is reduced. 11 The tenants remain unsettled in the premises and unhappy that the chattels they enjoyed were taken without consultation with them.
- The tenants’ application is complicated by the fact the original landlords sold the premises, and the new landlord was not included as a party to this application.
- The Tribunal telephoned the new landlord’s authorised person, Tony Spelman, who graciously agreed to participate in the hearing despite having been given no notice of the hearing. 11 RTA, s 66(1).
- Mr Spelman kindly consented to the tenancy being ended early so long as the tenants agreed to cooperate with access for prospective tenants to view the premises.
- Mr Spelman indicated he would likely ask for access for viewing on Saturdays and Sunday for about two hours per day, perhaps approximately between 2:00 and 4:00PM. Ms Chang indicated the tenants were agreeable to that in principle. It is anticipated that the tenants will allow inspections during those times and perhaps other times if for example a prospective tenant could not view the premises within the indicated times, and that they will not unreasonably withhold consent for viewings. 12
- The new landlord is added as a party in the circumstances.
- The Tribunal makes an order reducing the tenancy to 19 June 2024, by consent of the parties. Filing fee
- The Tribunal orders the landlords to reimburse the tenants for their filing fee because the tenants have substantially succeeded in their claim.