What was Tenancy Tribunal case 4891950 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 4891950?

Verified claim lines are listed on this page.

What type of tenancy dispute was case 4891950?

The primary dispute was Exemplary damages.

Where can I read the official tribunal order for case 4891950?

The official Ministry of Justice published order is available at https://forms.justice.govt.nz/search/Documents/TTV2/PDF/10876057-Tribunal_Order_Redacted.pdf.

What was Tenancy Tribunal case 4891950 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 4891950?

Verified claim lines are listed on this page.

What type of tenancy dispute was case 4891950?

The primary dispute was Exemplary damages.

Where can I read the official tribunal order for case 4891950?

The official Ministry of Justice published order is available at https://forms.justice.govt.nz/search/Documents/TTV2/PDF/10876057-Tribunal_Order_Redacted.pdf.

New Zealand Tenancy Tribunal Case 4891950 — Exemplary damages

Order

An application for suppression has been made in this case, and the Tribunal orders suppression of both parties’ names and identifying details.
The claims are dismissed.

Reasons

Both parties attended the hearing [The landlord’s representatives] represented [The property management company] and the owners, who did not wish to attend.
[The tenant/s] seeks compensation and/or exemplary damages for alleged failures of the landlord to lodge her bond and honour an agreement to break the fixed term lease early.
I discuss the claims separately below however first give a brief background to the situation.
[The tenant/s] entered into a fixed term tenancy with the owners on 9 April 2023. Shortly thereafter due to communication difficulties, [The property management company] took over the management of the tenancy.
On 15 May the property manager agreed that if [The tenant/s] wished to leave the tenancy early, they would waive the break-lease fees. The relevant email notes as follows:
[The tenant/s] evidence is that the property manager also verbally told her she could give four weeks’ notice to end the tenancy. [The landlord’s representative]’s evidence is that he has spoken to the relevant manager, and she has assured him she did not give such advice. The manager did not give oral evidence at the hearing.
On 23 November an inspection was held, and [The tenant/s] told the manager they wished to leave. She says the manager reminded her to give four weeks’ notice, therefore she immediately emailed to do so. The property manager replied to her email by saying: As you are currently on a Fixed Term Tenancy Agreement which expires on 28/4/2024, vacating on 21/12/23 date will be breaking your lease. As detailed in our email upon your initial request to break your lease, you are responsible for all charges associated with the re-letting of the property and ensuring the landlord does not suffer a loss of rent during the fixed term. In a Break Lease situation the tenant is required to pay: - Rent until a new tenancy agreement commences or to the end of the fixed term agreement, whichever is soonest; - All reasonable expenses incurred in relation to the end of your tenant and securing a new tenant (as per the expenses schedule sent in our previous email). We will contact you again shortly regarding payment of the above. We have enclosed a Vacating Checklist to assist you with vacating.
On 27 November the manager then advised [The tenant/s] that the owner did not give permission for her to break the lease. On 5 December [The tenant/s] asked about assigning the lease and, on the 8th, she was advised that she could do so if she found a suitable replacement tenant.
On 19 December the owner reversed their decision and allowed [The tenant/s] to end her lease early when replacement tenants were found. The landlord immediately commenced advertising and a replacement tenancy was sourced on 26 January to start on 7 February.
After the tenancy ended the landlord lodged a claim for compensation for end of tenancy costs. [The tenant/s] lodged a cross application for her bond to be returned. Those matters were resolved in mediation.
[The tenant/s] submission is that due to the landlord not honouring their original agreement to break the lease early, advertising was delayed a month, therefore their departure was delayed for over six weeks. They had to cancel their bookings to leave on the 28 th of December and her daughter missed the start of her schooling. They also entered their new country at a time when accommodation was at a premium due to events at the time. She says they incurred over $8,000 in extra costs due to this delay.
The landlord’s submission is that the 23 November email was an acknowledgement not an acceptance of the breaking of the lease. [The landlord’s representative] says the terms of the tenancy were clear in that it was a fixed term tenancy and could not be ended early otherwise than by agreement or Tribunal Order. He also says assignment was always an option for the tenants and that even had they advertised at the end of November for a short- term tenant 1 it was unlikely they would be able to secure one.
[The landlord’s representative]’s further submission made at the end of the hearing and post hearing is that these matters should not be litigated as they have previously been dealt with.

Should the landlord pay compensation for the delayed break lease?

A fixed term tenancy is not one that can be broken without agreement or Tribunal Order. It is intended for the tenancy to last for the contracted period to afford both parties security of tenure.
An assignment is different as that is the transfer, by agreement, of a tenancy from one party to another. The Residential Tenancies Act 1986 (RTA) defines the term in section 2 as a transfer to a person of all of the rights that a tenant has under a tenancy agreement. Sections 43A&B of the RTA allow a tenant to assign their tenancy with the prior written consent of the landlord and notes that a landlord may not unreasonably withhold that consent.
The first questions I must answer are as follows: i. Did the landlord offer [The tenant/s] the option to end the fixed term tenancy with four weeks’ notice? ii. Did the landlord consent to [The tenant/s] wish to end the tenancy early on 23 November?
As [The property management company] were managing the tenancy, their property manager acted as agent for the landlord. [The tenant/s] evidence is that the relevant property manager told her twice in May and once in November verbally that she could give four weeks’ notice to end the tenancy but also that she would have to pay rent until the replacement tenancy was sourced. This is why she immediately gave four weeks’ written notice.
[The landlord’s representative] submits that the manager did not say that, and he doubts she would. He relies on the tenancy agreement which states this is a 1 i.e. until the end of the fixed term in April fixed term lease and says there was not consent to it ending early until 18 December.
There is therefore a conflict of evidence, which is not uncommon in cases of this kind. The role of the Tribunal is to assess the evidence and determine whether allegations are established to the requisite standard, the civil standard of balance of probabilities, or what is more likely than not.
In not having evidence directly from the property manager I am disadvantaged as I only have one party giving evidence regarding alleged verbal discussions. Bearing that in mind I must accept [The tenant/s] evidence of those discussions. Her oral evidence is also supported by her email immediately following the oral discussion. I find it more likely than not that after her discussion with the manager, she followed the direction given to her and provided four weeks’ notice. There does not appear to be any other reason why she would do so.
Accordingly, I find on the balance of probabilities that the manager orally told [The tenant/s] that she could give four weeks’ notice to end the tenancy if she wished to break the lease. Given the manager was acting on behalf of the landlord, [The tenant/s] was entitled to rely on that advice as an amendment to her tenancy agreement.
I note that her advice was also that she needed to pay rent until a replacement tenancy was secured. Therefore, although she could give four weeks’ notice, the tenancy would still continue until a replacement tenancy was secured. The advice of the four weeks’ notice was therefore not particularly pertinent as it was caveated by the term that she pay rent until a replacement tenancy was secured. So, she could give notice, but the tenancy would still continue until a new tenancy was secured.
In reading the response from the manager on 23 November, I also find that she accepted [The tenant/s] intention to break the lease early. She gives the details of how the process will go and attaches the vacating check list. This is not an acknowledgement, but an acceptance of an intention.
In making this finding I have taken into account the common law doctrine of “contra proferentem”. Also known as “interpretation against the draftsman", it is a doctrine of contractual interpretation providing that, where a promise, agreement or term is ambiguous, the preferred meaning should be the one that works against the interests of the party who provided the wording. The doctrine is often applied to situations involving standardised contracts or where the parties are of unequal bargaining power, and I find both of those features are present here. The reasoning behind this rule is to encourage the drafter of a contract to be as clear and explicit as possible and to take into account as many foreseeable situations as it can. Contra proferentem also places the cost of losses on the party who was in the best position to avoid the harm. This is generally the person who drafted the contract/communication, and in this case the property manager of a well-established company.
I have also considered section 85 of the RTA which provides that the Tribunal shall determine a dispute according to the substantial merits and justice of the case and in doing so, shall have regard for the law but shall not be bound to give legal effect to strict legal rights or obligations or to legal forms or technicalities. This provision recognises that, although applying established legal principles will generally produce a fair result, there are circumstances where it will not. In this situation, the Tribunal is entitled to depart from the strict application of the law to achieve a just outcome. Equally, where the law is uncertain, the Tribunal may adapt an approach that best meets the merits and justice of the case.
Accordingly, I am satisfied that [The tenant/s] was entitled to believe she had permission to end her fixed term tenancy early upon the securing of a replacement tenancy. This had been communicated to her in writing in May and November. At no point had she been advised that that approval was subject to owner consent. Therefore, when the owner did not give their consent on the 27 th , they did this in breach of the agreement between the property manager and [The tenant/s].
It appears the property manager had given consent to the tenancy ending early without the owner’s consent. That is an issue for the agent, and not for [The tenant/s].
[The tenant/s] was also entitled to believe that advertising would commence within a reasonable period after she advised of her intention and that the costs of doing so would be waived as this was communicated to her in the May email. Whether she could expect that process to be successfully completed within four weeks of her notice is another matter.
I therefore find that the landlord attempted to renege on the agreement made with [The tenant/s] on 27 November. This was made good by the position being reversed on the 18 th of December, some three weeks later. Accordingly, the advertising of the property was delayed by, at most, three weeks.
As [The landlord’s representative] submits, there is no guarantee that advertising any earlier would have meant the tenancy could have ended any earlier than it did. However, it may well have.
[The tenant/s] family have clearly incurred costs in their move as they always would have. I do accept her evidence that she has been put to extra cost because of the delay however I find it was somewhat optimistic of her to have expected that a replacement tenancy would have been found within four weeks of her notice, i.e. that she could keep to her desired vacate date of 28 December.
I also note that as a matter of law, a tenant is not entitled to compensation for losses which, had they taken steps to mitigate, they would not have suffered. [The tenant/s] did not mitigate her losses by attempting to find a potential assignee for the tenancy as she was required to do pursuant to section 49 of the RTA.
Despite these findings, I decline to make an award of compensation. The reason for this is that [The tenant/s] is attempting to relitigate matters that have already been dealt with. This is the principle of res judicata: that is that a matter that has already be litigated, cannot be revisited. The Court of Appeal 2 has noted that it is an abuse of process where a matter has already been litigated to conclusion, and a disgruntled party to that litigation seeks to resurrect it in some other form. Specifically, the Court noted that that res judicata will cover: "issues so clearly part of the subject matter of the earlier litigation that they could and ought to have been raised and further" "Whenever a party against whom a judgment has been made has failed to raise some question he or she could have raised, the judgment includes a decision on the omitted question. This is because the law imposes a positive obligation on litigants to bring forward their whole case. The law will not hear a litigant to argue later that they have not argued their case carefully or inadvertently or by accident omitted part of their case. This has been the law for a considerable period of time and back to the leading case of Henderson (1843)" “The rule in Henderson v Henderson is very well known. It requires the parties, when a matter becomes the subject of litigation between them in a Court of competent jurisdiction, to bring their whole case before the Court so that all aspects of it may be finally decided, (subject, of course, to any appeal) once and for all. In the absence of special circumstances, the parties cannot return to the Court to advance arguments, claims or defences which they could have put forward for decision on the first occasion but failed to raise. The rule is not based on the doctrine of res judicata in a narrow sense, nor even on any strict doctrine of issue or cause of action estoppel. It is a rule of public policy based on the desirability, and the general interest as well as that of the parties itself, that litigation should not drag on forever and that a defendant should not be oppressed by successive suits when one would do. That is the abuse at which the rule is directed."
[The tenant/s] filed her original application on 26 February. In that claim she sought compensation for the landlord’s actions regarding the ending of the tenancy. That claim was settled alongside the landlord’s by mediation order. That order states that the agreement constitutes full and final settlement of all claims by either party for the above tenancy. 2 Fraser v Robinson [1991]3 257 at 260 NZLR
I have made findings on the matter because the landlord’s application to strike out [The tenant/s] claims did not come until the end of the hearing. I therefore consider it helpful to both parties to be aware of the conclusions I came to upon consideration of their evidence. I do not however make any monetary awards that would have been available had the claims not previously been settled. I understand that [The tenant/s] feels that due consideration was not given to these matters in the mediation but that is not something I can undo given she came to the agreement herself within that process.

Did the landlord breach their bond obligations?

On 21 April 2023 [The tenant/s] paid her bond to the owner. She was provided with the bond form to sign but omitted doing so. On 20 December [The tenant/s] asked for her bond number from the landlord and did not receive a response. The bond was lodged with the Bond Centre on 15 February.
[The tenant/s] seeks exemplary damages for this delayed lodging of the bond as she says this was her money and it should have been held in the appropriate independent organisation of the Bond Centre.
A landlord must send any bond payment to the Bond Centre within 23 working days after the payment is received. See section 19(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 19(2) and Schedule 1A RTA.
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) RTA.
[The landlord’s representative] accepts the error in failing to lodge the bond. His submission is that exemplary damages are not warranted however for the following mitigating reasons: a. [The tenant/s] had failed to sign the bond lodgement form. b. There was a significant amount of communication and issues with this tenancy from the start which is why the bond was missed. c. His staff member was incorrectly advised by Tenancy Services on 22 January that a one-party bond cannot be lodged. They were then given conflicting (but correct) advice from Tenancy Services on 14 February that it could be. d. They offered [The tenant/s] the undisputed portion of the bond before they lodged it however due to unclear wording the offer was not accepted. e. There was no intention to breach the law, it was an error. f. There was no apparent effect on [The tenant/s] because the bond was always safeguarded. g. The mediation settlement in May dealt with this issue and it should not be relitigated.
Clearly, section 19 of the RTA was breached by the landlord in this instance. This is an unlawful act.
[The landlord’s representative] says the omission was not intentional as it occurred due to a mistake and was rectified when it was realised. I do not accept this submission for the following reasons: a. The landlord realised on 20 December the bond had not been lodged however did not advise [The tenant/s] nor did they take steps to immediately lodge it and it was some weeks before it was. b. [The property management company] should have ensured the bond was lodged when they took over management of the tenancy. But likewise, the owner had the initial obligation since they received the bond. c. It was not lodged until after the tenancy had ended and the bond was in dispute. d. [The property management company] is an extremely experienced landlord. e. [The landlord’s representative] knew and advised when he was consulted that a bond could be lodged, even without a completed form. The property managers should also have known this. f. The duty in section 19 RTA is very clear: Where any person pays to the landlord...any amount by way of bond...the landlord shall within 23 working days...lodge it with the Bond Centre. This is mandatory and there are no exemptions. g. Landlords must have in place the necessary checks and balances to ensure such basic landlord responsibilities as filing bond money are met. h. This may well have been a mistake, but it was not one that should have happened on a matter regarding which the law is very clear.
I therefore find that the unlawful act was committed intentionally. I do not however make an award of exemplary damages as I find that the matter has already been dealt with.
[The landlord’s representative] submits that exemplary damages for the bond not being lodged were discussed within the mediation and the settlement included that claim. [The tenant/s] disagrees and says the mediator told her that would need to be a separate claim.
Again, the parties differ in their recollection of the mediation discussions and as they are made on a without prejudice basis, I have no jurisdiction to enquire. I am limited to consideration of the applications of both parties. [The tenant/s] original application 3 notes that the bond was not lodged in time which is unlawful. Therefore, her original application did cover this matter and cannot be relitigated.
Although these claims have been dismissed, I approve both parties’ applications for suppression. I do so on the basis that the mediation process has been referred to and that is a confidential process. I also find it disproportionate to publish the parties’ names in the circumstances.

Tenancy Tribunal case 4891950 — Exemplary damages

At a glance

Claims & awards

Tenancy Tribunal case 4891950 — Exemplary damages

At a glance

Claims & awards

Order

Reasons

Should the landlord pay compensation for the delayed break lease?

Did the landlord breach their bond obligations?

Topics & place

Residential Tenancies Act sections

Key findings

Frequently asked questions

Order

Reasons

Should the landlord pay compensation for the delayed break lease?

Did the landlord breach their bond obligations?

Topics & place

Residential Tenancies Act sections

Key findings

Frequently asked questions