What was the outcome of Tenancy Tribunal case 4880041?

The tribunal order states: Jenny and Phil Cottingham as trustees of the The Prema Charitable Trust must

How much money was awarded in case 4880041?

Compensation: Door Gap: $100.00 awarded to tenant; Property Damage: $500.00 awarded to tenant

What type of tenancy dispute was case 4880041?

The primary dispute was Exemplary damages.

Where can I read the official tribunal order for case 4880041?

The official Ministry of Justice published order is available at https://forms.justice.govt.nz/search/Documents/TTV2/PDF/11550265-Tenancy_Tribunal_Order.pdf.

What was the outcome of Tenancy Tribunal case 4880041?

The tribunal order states: Jenny and Phil Cottingham as trustees of the The Prema Charitable Trust must

How much money was awarded in case 4880041?

Compensation: Door Gap: $100.00 awarded to tenant; Property Damage: $500.00 awarded to tenant

What type of tenancy dispute was case 4880041?

The primary dispute was Exemplary damages.

Where can I read the official tribunal order for case 4880041?

The official Ministry of Justice published order is available at https://forms.justice.govt.nz/search/Documents/TTV2/PDF/11550265-Tenancy_Tribunal_Order.pdf.

Room R26, 14 Mills Lane, Albany, Auckland 0632 Tenancy Tribunal Case 4880041 — Exemplary damages

Claims and awards in Tenancy Tribunal application 4880041 — net $600.00 NZD. Amounts reconciled from the published order (claims sum and net total). Verify on MoJ.
Claim	Tenant	Reason
Exemplary damages: Failure to lodge bond	$500.00	Failure to lodge bond
Compensation: Door gap	$100.00	Door gap
Net award	$600.00
Total payable by Landlord to Tenant	$600.00

Claims and awards in Tenancy Tribunal application 4880041 — net $600.00 NZD. Amounts reconciled from the published order (claims sum and net total). Verify on MoJ.
Claim	Tenant	Reason
Exemplary damages: Failure to lodge bond	$500.00	Failure to lodge bond
Compensation: Door gap	$100.00	Door gap
Net award	$600.00
Total payable by Landlord to Tenant	$600.00

Order

Jenny and Phil Cottingham as trustees of the The Prema Charitable Trust must pay Darryl George Mihaere $600.00 immediately, calculated as shown in table below: DescriptionTenant Exemplary damages: Failure to lodge bond$500.00 Compensation: Door gap$100.00 Total award$600.00 Total payable by Landlord to Tenant$600.00
All other claims are dismissed.

Reasons

The Tribunal must consider an application filed by the tenant against the landlords. The tenant seeks various orders in relation to a boarding house tenancy that has now ended.
Both parties appeared at the hearing today held in the North Shore District Courthouse.

BACKGROUND

I will sit out the more specific background further below, but in summary, the parties entered into a boarding house tenancy agreement, commencing on 29 May 2021.
From what the parties advised me, the premises seem very large. The tenant estimates that there would have been around 100 tenants, the landlord estimated about 70.
I understand there were financial issues with the complex, and the decision was made to sell the premises. After a sale was agreed, Mr Mihaere’s tenancy was terminated with 28 days notice, that notice was issued on 1 May 2024.
Later that month Mr Mihaere filed this application with the Tribunal.

APPLICANTS CLAIMS

At the hearing, the applicant confirmed their claims are as follows: a. Failure to lodge the bond b. Failure to advise premises on market c. Breach of the HHS. d. Incorrect information on HHS statement e. Failure to maintain premises.

RELEVANT LEGAL CONSIDERATIONS

The relevant law that applies is found in the Residential Tenancies Act 1986 (“RTA”).
With any claim before the Tenancy Tribunal, the Tribunal applies the usual civil law standards and expectations.
That includes a requirement that the party bringing the claim (the applicant), establish their claims “on the balance of probabilities”. The balance of probabilities means more likely than unlikely, or in mathematical terms, has a fractionally more than 50% likelihood. The Tribunal does not need to be certain or very sure about any claim, only that what is claimed is likely.
This obligation carried by the applicant is referred to as the “burden of proof”. Independent witnesses, corroborating documents and photographs are an important part of discharging this burden.
As noted by the District Court in Kaipo v Clarke & McCarthy (DC) TT233/02, in practical terms this means that: ... [L]ike anyone who brings an application before a Tribunal or Court, it is incumbent upon the applicant to provide the evidence necessary to prove the case. If the applicant fails to do that, then their application will be dismissed whether it has merit or not because it is up to the applicant to provide the necessary evidence. It is not up to the other parties, and it is certainly not up to the Tribunal to extract evidence. Exemplary damages
The Tribunal must consider a claim for 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.
Section 109 of the RTA relates to exemplary damages, and confirms that 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 maximum levels of exemplary damages are set out in Schedule 1A of the Act.

ANALYSIS

I will now consider the five claims in turn. Claim 1 – Failure to lodge bond
The tenant states that the bond was not lodged until 27 July 2021, but he moved in on 29 May 2021.
In response, the landlord agrees that the bond was lodged late, but states at this time the Cottingham’s were not administering the premises or trust. The premises were being run by another manager, but the Trustees agree that the trust remains responsible. The Trustees do not dispute that the bond was lodged late. Analysis
The tenant claims exemplary damages on the basis that the landlord has breached section 19 of the RTA, for failing to lodge the bond with the Chief Executive.
Section 19 of the RTA sets out the “Duties of landlord on receipt of bond”, and confirms that the landlord: shall, within 23 working days after the payment is made, forward the amount received to the chief executive, together with a statement of particulars in the approved form signed by the landlord and the tenant.
For the purposes of this provision, the bond is considered to be lodged with the Chief Executive, by lodging the bond with the Bond Centre.
Section 19(2) of the RTA confirms that failure to lodge the bond following the section 19 requirements, is declared to be an unlawful Act, and therefore could be the subject of an order of exemplary damages.
There is no dispute between the parties, that the bond was paid by the tenant, and not lodged within the required 23 working day period. The landlords have breached their obligations under section 19.
I have considered the criteria under section 109 in relation to unlawful acts, or to put there’s another way claims for exemplary damages, and find that an order should be made in this case for these reasons.
The requirement to lodge bonds with the Bond Centre, within a statutory period, is well known. I could not accept that a large landlord such as this, would have been unaware of its obligations, whether it was a manager or the trustees looking after the premises. It is likely the delay in lodgement was intentional, certainly there is no evidence suggesting otherwise. The effect for the tenant is that his bond is not kept securely and the bond centre, as the bond regime requires. There is a very strong interest for tenants, landlords in the public generally that the bond system in New Zealand is strong. That requires that bonds be lodged by landlords efficiently and consistently. I consider that an order of exemplary damages would be just.
The maximum level of exemplary damages for a breach of the landlord’s bond the obligation, is $1,500.00. In this case I consider an order at 1/3 rd of the maximum would be indicated. I do not consider that there is sufficient evidence to argue for a higher or lower amount, and I am minded that this is a case where the landlord has lodged the bond with the Bond Centre, albeit a month late. Claim 2 – Failure to advise the premises were being put on the market
The tenant states the premises were put on the market until early 2024, then there was a meeting saying that the premises were being taken off the market. But the tenant says that 5 months later, the premises had been sold, and then notice was given to end the tenancy. The tenant’s position is that they should have been advised that the premises were going on the market.
In response, the landlords state that the organisation was in significant debt, and the decision was made to put the premises on the market. This was notified to the tenant on or around 25 April 2023, but the sale was later withdrawn. However, subsequently, an offer was made to purchase the premises, but that required vacant possession. Ms Cottingham advised that she was concerned about her personal safety if notice was given, and that once notice was given she would be unable to return to the premises.
The landlord set out the efforts they made to ensure their tenants found somewhere else to live, and for some of the residents the landlords took them into their own home.
In conclusion, Mr Mihaere states that the law still required that notice be given to the tenants. Analysis
The tenant’s position is that the landlord has failed to advise that the premises were to be put on the market. Section 47 of the RTA states: 47 Landlord to give notice to tenant if premises put on market (1) If, at any time after entering into a tenancy agreement, the landlord puts the premises on the market for the purposes of sale or other disposition, the landlord must, as soon as practicable, give written notice of that fact to the tenant. (2) ... (3) A landlord who fails to comply with subsection (1) or (2) commits an unlawful act.
The evidence as I understand it to be, is that in 2023 the landlord decided to put the premises on the market, and the tenants were notified of that at the time. However after a period of time the landlord withdrew the premises from the market. I understand that at a time when the premises were no longer on the market, the landlord was approached by a purchaser, and it was from that approach the premises were sold.
In this case, I am not persuaded that the landlord has breached their obligations under section 47. In my assessment of that provision, the obligation to notify the tenants occurs when the premises are put on the market, which I interpret to be that the landlord has made a decision to sell the premises, and further that the premises are advertised to potential buyers. In this case the landlord was approached by the buyer, as opposed to marketing the property.
However, if I were wrong on that, I would have also declined to order exemplary damages in the circumstances. I note that the landlord had advised that the premises were to be sold in 2023, so the tenants would reasonably have been aware that the sale was contemplated for the future. Furthermore, the landlord has provided a written notice of the sale, which was a written communication from 1 May 2024.
In the circumstances, even if there had been a strict breach of section 47, I would not have determined that there was evidence to show the breach on the part of the landlord was intentional, nor would I conclude that making an order of exemplary damages to punish the landlord would be just. Claim 3 – Breach of Healthy Homes Standards
The tenant states that he has a friend who is a builder, who attended and inspected the premises and raised the following issues: a. There is styrofoam insulation over wiring that is not in conduit, and further that there is metal foil insulation which is now unlawful. b. A large gap on the side of an aluminium door being the door Mr Mihaere rented.
Mr Mihaere read out an email or similar on his phone setting out the issues with the insulation.
The landlords consider that the insulation complies with the legal requirements, and state that they don’t know of any report of issues with the gap. The landlords state that as far as they know, the premises were compliant, but because they no longer own the premises they cannot go back and check the building. Analysis
The tenant claims that the landlords have breached their obligations as it relates to the Healthy Homes Standards around gaps and insulation.
The Residential Tenancies (Healthy Homes Standards) 2019 (“HHS”) provided for a minimum set of requirements for residential tenancies as it relates to heating, ventilation, insulation, draught stopping, moisture ingress and drainage.
Section 66I(1)(bb) of the Residential Tenancies Act 1986 (RTA) requires compliance with the HHS. A breach of this obligation is deemed to be an unlawful act, for which exemplary damages can be ordered. The maximum level of exemplary damages that can be ordered as set out in Schedule 1A to the RTA, is $7,200.00.
Compliance dates for the HHS vary depending on the tenancy, but all boarding houses must comply by 1 July 2021. Insulation standard
The Insulation standard requires that the premises have qualifying insulation in the ceiling cavity, and under the floor if the floor is a suspended floor. To be considered ‘qualifying insulation’ the insulation must meet a minimum R value. The insulation must also be in a reasonable condition.
The tenants position is that the landlord has breached the installation standard for three reasons: a. Missing underfloor insulation panels. b. Polystyrene panel installation being in contact with electrical wires. c. The presence of metallic foil insulation.
The photographs provided by the tenant show the underfloor area, beneath his boarding room. The photographs confirm that for most of the spaces between the joists, the landlord has installed a polystyrene foam product. The product appears to be a standard underfloor insulation product. There is no evidence before me that the foam would not comply with the minimum R value necessary, but the tenant has not suggested that to be the case.
The appearance of the photographs, is that the floor was originally installed with a metallic foil insulation product. That product is plainly in poor condition, but it does appear that the polystyrene insulation was installed over the top of the foil insulation, or more accurately below it.
The significant issue taken by the tenant, is that there is existing foil isolation present, the tenant states that had been outlawed in 2016, and should have been removed. I am not persuaded that is the case, as I understand the obligations, from 2016 buildings could still use new foil installation providing there was not an electrical supply to that building, but if there was an electrical supply (like this boarding house), then the owner could not install new foil insulation, and neither could the owner repair in the damaged foil insulation. But there was no obligation in law that the foil insulation be removed.
In that regard I note the information found online from MBIE at this address: https://www.building.govt.nz/building-code-compliance/warnings-and-bans-on- building-products/foil-insulation-ban
The HHS also requires that insulation comply with the relevant New Zealand Standards, being NZS 4246:2016. I have reviewed that standard, and that also does not require the removal of existing foil insulation; again only includes a prohibition on installing new or repairing existing insulation after 2016.
Accordingly then, I find that the fact of there being foil insulation under the floor, is not of itself an established breach of the HHS.
The tenant has also raised concerns in relation to electrical wires being in contact with the polystyrene. Whether that is the case or not, I am not certain, but it is not a matter that is found in the HHS. If there is a breach of a building code obligation, that would be a matter for the council to deal with, but it would fall outside the jurisdiction of the Tenancy Tribunal. I note for completeness that as I have indicated above the photographs suggest that the polystyrene has been placed over the existing foil insulation. If that is the case, and if there are wires between the foil and the timber floor, then it is questionable whether the polystyrene is even in contact with the wires.
Finally there is the issue of two missing polystyrene panels. It is difficult to know what to make of that fact, given the photograph shows all of the other sections of joist have the polystyrene insulation. In the absence of evidence to the contrary, it must be more likely than not that there was originally a polystyrene insulation under those two sections of flooring, which has fallen away or blown away. If that is the case, then the tenant will not be able to establish an intentional breach of the landlords HHS obligations.
I find a breach of the landlords insulation obligations under the HHS has been established, so this claim is dismissed. Draught Stopping Standard
The draught stopping standard requires that residential premises be free from unreasonable gaps and holes that are not an intentional part of the building, which allow draughts to arise.
In this case the tenant has provided a photograph which shows a noticeable gap in the side of his door, to his dwelling unit. That gap would be of an unreasonable size, and I find it would breach the HHS obligation.
The question then, is whether exemplary damages should be ordered, and find I cannot.
While I accept that there is a breach, in order for me to order exemplary damages, I must conclude that the breach was intentional on the part of the landlord.
In the District Court decision of Birch v Otautahi Community Housing Trust [2020] NZDC 17667, the Court needed to consider a case where the landlord had unlawfully entered the tenancy. That was not disputed. The evidence was that because of a misunderstanding around notices being given, the landlord went into the tenancy without the necessary notice having first being served on the tenant. Judge Neave in the District Court agreed with an earlier summary of the law from the Tribunal 1 that: Before an award for 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.
Judge Neave went on to accept that the unlawful entry was made in error, and on that basis there was no intention established, therefore there was no basis to order exemplary damages.
A second District Court decision of relevance is Peter Stoekeken v Nykala Toheriri and Vince Aso [2022] NZDC 9698, a decision from Judge Tuohy. The dispute in that case was included a claim for exemplary damages because the landlord had rented the premises with an exposed electrical wire. Judge Tuohy accepted that the landlord did not know the wire was exposed, but importantly confirmed that: ...S 109(3) of the Act requires the Tribunal to be satisfied that the unlawful act was committed intentionally by the person who committed it before exemplary damages can be awarded.... 1 Chief Executive, ex party Edmonson v Walls North Shore TT 548/92 ...assuming that the landlord is liable for the omissions of his agents as well as his own, I am not satisfied that he or his agents intentionally decided not to carry out an inspection which was sufficiently through to reveal the wire. Even if they ought to have noticed it, that is not equivalent to an intentional act. As the Adjudicator in the second decision stated when declining to award exemplary damages to the landlord, the unlawful act must have been committed intentionally in the sense of deliberately and in full knowledge that they were not meeting their obligations. The evidence does not establish that. In summary, I consider that there are insufficient grounds to award exemplary damages against the landlord in relation to the exposed wire.
One of the submissions made by the landlord, is relevant, which is that the tenant did not raise the gap with them. Certainly there is no evidence supporting that this was raised. On the evidence available, I cannot be satisfied that the landlord knew of the gap, and, therefore intentionally breached their obligations under the RTA.
I accept however, that there was a gap in the door of the Tenancy, and the tenant was paying rent for a warm dry room, which is not achieved when there are unnecessary gaps in the dwelling. It is fair that Mr Mihaere receive some level of compensation for that, and I make an order of $100. Claim 4 – Incorrect information on HHS Statement
The tenant states that the HHS statement is incorrect because it did not say that the polystyrene insulation had been placed over the existing insulation. The tenant states that the foil needed to have been removed in 2016.
Again the landlords state they did not know of any breach at the time. The landlords state that if the tenant knew of any defect with the premises at the time he should have raised it then, not 9 months after the tenancy had ended. Analysis
For the reasons as set out above, I find that no breach has been established as far as the insulation is concerned. Claim 5 – Failure to maintain
The tenants position is that the premises are old, but have not been maintained. The tenant stated that following a cyclone, there were issues with the driveway, he placed at no cost to the landlord around 60 tonnes of aggregate for the driveway. Mr Mihaere states that he had offered this to the landlords given he in the trucking business, and if this had not been done, the residents could not access their cars.
Mr Mihaere also mentioned the other defects as set out above. Mr Mihaere states he was concerned if he raised the concerns that would jeopardise his tenancy.
The landlord states that the premises were fully compliant with fire requirements, and this aspect of the boarding house was assessed and signed off every year.
Mr Mihaere said that the residents would undertake maintenance work because the landlord would not do this work. Analysis
As above, the onus sits with the person bringing the application (the tenant) to provide sufficient evidence proving the claimed breaches. In terms of maintenance to the premises, this has not been established.
In terms of the driveway, the tenant acknowledged that he offered to do that work. If the driveway had washed out, there would have been a requirement on the landlord to maintain that, and if the landlord had not done so, then the tenants could have provided a notice to the landlord to do the work, or obtain a work order from the Tribunal. But the fact that the tenant offers to undertake work, does not of itself prove a breach on the part of the landlord.
Beyond that, Mr Mihaere has not identified any maintenance work needed at the tenancy that the landlords knew about but did not do. I find this claim has not been established.

NAME SUPPRESSION

The Tribunal can order name suppression when a party has been wholly or substantially successful in the proceeding. In this case the tenant has applied for name suppression. However as the tenant has not been wholly or substantially successful in the claims, name suppression is declined.

Tenancy Tribunal case 4880041 — Exemplary damages at Room R26, 14 Mills Lane, Albany, Auckland 0632

At a glance

Tenancy Tribunal case 4880041 — Exemplary damages at Room R26, 14 Mills Lane, Albany, Auckland 0632

At a glance

Award balance

Claims & awards

Dismissed claims

Order

Reasons

BACKGROUND

APPLICANTS CLAIMS

RELEVANT LEGAL CONSIDERATIONS

ANALYSIS

NAME SUPPRESSION

Topics & place

Residential Tenancies Act sections

Key findings

Property management

Frequently asked questions

Award balance

Claims & awards

Dismissed claims

Order

Reasons

BACKGROUND

APPLICANTS CLAIMS

RELEVANT LEGAL CONSIDERATIONS

ANALYSIS

NAME SUPPRESSION

Topics & place

Residential Tenancies Act sections

Key findings

Property management

Frequently asked questions