Published tribunal order
Tenancy Tribunal case 4877600 — Exemplary damages
Decided 4 Jun 2024 · Published 4 Jun 2024 · Application 4877600
- Exemplary damages
Party names are redacted in the official published order.
Reasons
- Both parties attended the hearing.
- [The tenant/s] claims the landlord has not lodged the bond with the Bond Centre within the required time.
- The parties accept that the bond was paid in December 2021.The landlord says that they experienced administration problem with staff being unavailable due to covid and a shift in office premises. This meant that the lodgement of the bond was overlooked until August 2023.
- A landlord must send any bond payment to the Bond Centre within 23 working days after the payment is received. See section 19(1) Residential Tenancies Act 1986.
- 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 Residential Tenancies Act 1986.
- The landlord did not lodge the bond within 23 working days after the payment was received. I find they have committed an unlawful act.
- 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 section 109(3) Residential Tenancies Act 1986.
- A bond is the tenants’ money and must be lodged with the Bond Centre within the statutory time limit to protect the tenants’ interests. Lodging a bond is not a conditional obligation but a mandatory one and it is in the public interest that landlords fulfil their obligations under the Act. If no penalty is imposed there can be no deterrent.
- The failure to lodge the bond must be intentional for exemplary damages to be awarded. Therefore, damages will not be awarded where non-lodgement is a genuine oversight, rather than an intentional act (Chief Executive for Housing New Zealand v Walls [1993] NZTT Auckland 548/92).
- However, the Tribunal may draw an inference of intent where the landlord claims to have simply forgotten, as a landlord should have systems in place to ensure this does not happen. Exemplary damages have been awarded where: the landlord has no explanation for the non-lodgement and has other tenancies (Jones v Ying [2001] NZTT Auckland 2783/01); the landlord is experienced (Hart v Allen Realty Ltd [2003] NZTT Auckland 2183/02); and where the landlord knew of the obligation from the bond form signed by the tenant (Fu v Florendo [2013] DC Manukau, CIV-2013-092-2373).
- In this case the landlord is experienced and was aware of its obligations. Systems should be in place to ensure an oversight of this nature does not occur. I consider that an appropriate award of exemplary damages would be at the lower end of the scale. The landlord is ordered to pay $500.00 in exemplary damages.
- As [The applicant/s] has wholly succeeded with the claim I must order the landlord to reimburse the filing fee.
- Both parties applied for name suppression. The tenant has been wholly successful in this matter and suppression of the tenant name and details is ordered.
- The landlord has not been wholly or substantially successful and the application for suppression is dismissed.