Published tribunal order
Tenancy Tribunal case 5105348 — Exemplary damages at Unit/Flat 1, 617 Ferguson Street, Terrace End, Palmerston
Decided 16 Jan 2025 · Published 16 Jan 2025 · Application 5105348
- Exemplary damages
Party names are redacted in the official published order.
Order
- An application for suppression has been made in this case and the Tribunal orders suppression of the tenant’s name and identifying details.
- The Bond Centre is to pay the bond of $1,120.00 to the tenant immediately.
- MIn (Millie) Yu must pay the tenant $4,027.00 immediately as set out in the table below.
Reasons
- Both parties attended the hearing.
- The landlord agreed that it had no claim against the bond and so an order for its refund to the tenant is included in this Order by consent.
- The tenant’s application as detailed in the Notice of Hearing was for: a. The landlord issuing a retaliatory notice. See section 54 Residential Tenancies Act 1986 (“RTA”). b. The landlord unlawfully entering the premises. See section 48(4) RTA. c. The landlord breaching the tenant’s right to reasonable peace, comfort, or privacy. See section 38 RTA. d. An assessment of market rent. See section 25 RTA. e. Reimbursement of the filing fee.
- The tenant advised that the tenancy ended on 10 January 2025 and that he withdrew the application for an assessment of market rent. Standard of proof and evidence
- In considering the claims, the standard of proof is “on the balance of probabilities”. In other words, the tenant must establish with evidence that his claim is more likely than not. Each of the claims has been considered bearing in mind the standard of proof required.
- The Tribunal does not need to be completely certain, but it needs to be more certain than uncertain. In deciding each claim, all the evidence presented, including oral testimony, has been considered and weighed to decide what is more likely. Certain types of evidence carry more weight, which must be considered when weighing all the evidence.
- While this decision has not referred to all the evidence presented at the hearing, the parties can be assured that it has all been considered. In the interests of conciseness, only the most relevant or important evidence has been referred to in this Order. Any evidence that was not directly relevant to proving a claim that was part of the application has been omitted.
- Section 85(2) of the Residential Tenancies Act 1986 (RTA) requires the Tribunal to determine each dispute according to the general principles of the law relating to the matter and the substantial merits and justice of the case, but shall not be bound to give effect to strict legal rights or obligations or to legal forms or technicalities. The Tribunal has determined the parties’ applications with this requirement in mind. Background
- The tenant provided a timeline of events leading to his application to the Tribunal which was supported by evidence of emails and texts as follows: a. A notice of rent increase was issued by the landlord on 7 December 2023 increasing the rent to $350.00. b. A notice of rent increase was issued by the landlord on 1 December 2024 increasing the rent to $515.00, an increase of nearly 50%. c. On 2 December 2024 the tenant objected to the rent increase. d. On 3 December 2024 at 8.55 am the landlord emailed the tenant and advised that “we have a family of 4 with 2 daughters and would like to have a look at the place. If you do consider moving out, better start looking early as the rent market is increasing in price all the time.” e. A further email on that date from the landlord to the tenant at 10.26 am stated: “Now the set of tenants I mentioned in my last email has been offering another place which is significantly smaller than [the premises]. We believe we would be able to offer them a competitive price. You have to make up your mind as to whether to stay or not. We don’t have the capability to muck around with your suspensions [sic] etc and attitude any more!! Can you please let us know by today if we could arrange a view with them on [the premises] asap?!!” f. On 3 December 2024 at 12.46 pm the tenant emailed the landlord and stated: “I’m going to talk to the Tenancy Tribunal about it all and see what they have to say.” g. The tenant responded to the landlord by email that afternoon at 3.25 pm: “I do intend to stay so there is no need for a viewing. However, I went to the Tenants Union today and they have informed me to say ... I do not accept the rent increase of $165 to $515 for a 2 bedroom house. They looked up the fair price of this 2 bedroom house at $430. Which I would accept. If not they said I have a strong case to take to the Tribunal.” h. At 9.02 pm on the same day the landlord emailed a 63-day termination notice on the ground that “The owner of the premises requires the premises within 90 days after the termination date as the principal place of residence (for at least 90 days) for the owner or a member of the owner’s family.” i. On 3 December 2024 the landlord arranged for a property inspection which took place on 6 December 2024. By the text on 3 December 2024 the landlord told the tenant: “As this is purely to Micheal’s decision to separate from me to move into your house.” j. On 11 December 2024, some five days after the inspection, the landlord notified the tenant that she wanted a reinspection because the property needed vacuuming and there were some dishes in the sink. The parties agreed to a further inspection at 6.30 pm on 13 December 2024. k. The tenant’s mother who was present gave a written statement that the landlord arrived at the property at 6.56 pm with another woman introduced as a “friend”. The landlord was advised that section 48 RTA requires inspections to take place between 8 am and 7 pm and that the inspection would need to be done quickly. The statement records: “She moved past me with the woman, looked into the lounge, spare room and hallway (saying what they were). She pointed out the fan they had installed for Healthy Homes Compliance. I stayed in the kitchen as they both went out to the laundry, I heard her say, there’s a 2 nd toilet out here. Then they went to [the tenant’s] bedroom, she showed her the walk-in wardrobe/storage area and told her this is the sunroom. If the woman was just a friend, she didn’t have to follow her into every room and have it explained to her what they were. It was clearly a potential tenant. As they were leaving I saw the woman go to get in the car then [the landlord] motioned to her to go around the back of the property with her. I noted she left about
- 20 pm.” l. The tenant challenged the landlord about the presence of the woman as a prospective tenant at the inspection by email on 17 December 2024. In response the landlord stated: “She is just a friend of mine, and kept companionship with me when I was doing the re-inspection.” When the tenant challenged the landlord about bringing a friend to view the property, the landlord responded: “I don’t have to answer your strange question/s. Though I may say I do inspection/s by only myself normally. Nut at special occasions, I felt I needed a support/witness. We are only interested in the cleanliness and tidiness of the property, but your personal belongings and so on.” Landlord’s evidence
- The landlord gave evidence as follows: a. She was entitled to give notice of the rent increase even though the notices were dated less than a year apart (7 December 2023 and 1 December 2024) and the rent increase became effective less than a year later (7 February 2024 and 5 February 2025). She believes the increased rent was a fair market rent. b. The rent increase was justified as the property could be let as a three- bedroom home. c. A reinspection was necessary because the property needed vacuuming, dishes done and the stove top cleaned. d. The inspection took twenty-five minutes because the tenant’s mother chatted to her. e. She took the friend of another tenant in one of her properties because she was scared of the tenant. This person was not a prospective tenant. f. The property was required by her partner who wished to live on his own and he was now living there. Another family member would require the property later. Tenant’s response
- The tenant responded to the landlord’s evidence as follows: a. The matters requiring attention from the inspection were only notified some five days after the inspection and no 14-day notice of breach was issued. The tenant only recalled the stove top and the unwashed dishes being raised as requiring attention. b. The matters were superficial and required only a cursory inspection to determine that the matters had been attended to. The reinspection should only have taken a few minutes. c. The landlord had never brought any other person with her to inspect the property before. The conversation between the landlord and the woman indicated that she was showing the woman around the house and pointing out its features. Showing a stranger around the tenant’s home was an intrusion on the tenant’s privacy. d. The reinspection was a ruse to allow a prospective tenant to view the property and was in breach of section 48(2)(b) RTA because it was not pursuant to a breach notice under section 56 RTA. Rent increase notice
- The rent increase notice was invalid. It was to take effect within 12 months of the last increase.
- Because the tenant has withdrawn his claim for a market rent assessment and did not at any time during the tenancy pay the increased rent, it is not necessary for the Tribunal to make any further determination regarding the rent increase. Retaliatory notice: discussion and decision
- Section 54 RTA provides that the Tribunal may declare a termination notice to be retaliatory and of no effect, if: “[I]n giving the notice, the landlord was motivated wholly or partly by the exercise or proposed exercised 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.”
- Giving a termination notice which is declared to be retaliatory is an unlawful act for which exemplary damages may be awarded, up to a maximum of $6,500.00 (see section 54(2), (3) 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 s 109(3) RTA).
- There are four issues to consider: a. Does the termination notice comply with section 51 RTA? b. If so, was the application made within 28 working days of the notice being served? c. Has the tenant proved that, in terminating the tenancy, the landlord was motivated wholly or partly by the tenant exercising a right under the tenancy agreement or any enactment, or by any complaint against the landlord? d. If so, was the landlord justified in giving the notice because the tenant’s issue or complaint was frivolous or vexatious?
- The Tribunal has held that the term motivate has the ordinary dictionary meaning “to give impetus to ... to impel”. Usually there will be little direct evidence about the landlord’s intent in giving a termination notice. Therefore, the Tribunal must consider what inferences, if any, can be drawn from the timing and sequence of events.
- Where there is a short period of time between the tenant raising an issue about the tenancy and the landlord serving a notice, this may lead to a strong inference that the landlord was at least partly motivated by the tenant exercising his rights. In this situation, the evidential onus shifts to the landlord to show that there was a legitimate reason for the notice.
- The termination notice complies with the requirements of section 51 RTA.
- The application was made within 28 days of the termination notice being served.
- There is clear evidence before the Tribunal that the tenant had conveyed to the landlord that he intended to exercise his rights under the RTA and had made complaint to the landlord about her method of calculating the increased rent. He had objected to the rent increase and advised the landlord that he was contacting the Tribunal and the Manawatu Tenants Union.
- The tenant’s issue was neither frivolous nor vexatious. The notice was invalid, the rent increase was significant and would have an impact on his ability to remain in the tenancy which had been his home for four and a half years.
- On the evidence before the Tribunal, the tenant has proven on the balance of probabilities that the landlord was at least partly motivated by the tenant complaining about the rent increase for the following reasons: a. The landlord issued the notice on the same day and during the same exchange in which the tenant expressed his complaint and that he was seeking legal advice regarding a rent review. It is stretching belief that the timing was coincidental. b. The mention of having new tenants interested in the property at the increased rent is an indication that the landlord wanted the tenant gone without a challenge to the increased rent. c. The failure to issue a 14-day notice after the inspection which would have entitled the landlord to a reinspection within the four-week period after the 6 December inspection, the sudden appearance of a “friend of a tenant” who is shown around the property inside and outside, and the length of time of the inspection, all indicate that the reinspection was a ruse to show the property to a prospective tenant. d. The lack of any evidence regarding the reasons for the landlord’s partner suddenly requiring separate accommodation, the availability of other alternative accommodation for him, or any correspondence from any other family member who may require the premises later in the year cast serious doubt on the truth of this assertion so that the landlord has not persuaded the Tribunal on the balance of probabilities that her reason for issuing the notice was genuine.
- The landlord has committed an unlawful act in issuing a retaliatory notice for which exemplary damages may be awarded, up to a maximum of $6,500.00. See section 54(2), (3) and Schedule 1A RTA.
- Where a party has issued a retaliatory notice, the Tribunal may award exemplary damages where it is satisfied it would be just to do so considering the effect of the unlawful act, the interests of the other party, and the public interest. For completeness giving of a retaliatory notice does not have to be intentional to award exemplary damages for a breach. See section 109(3) and (3A) RTA.
- The effect of the retaliatory notice was that the tenant believed he would have to move out of his home as the Tribunal would be unable to hear his rent application by the time the notice expired. He explained that he has found a new home and that he had to take time off work, borrow a truck and enlist the aid of friends to help him move. He has had to raise funds to pay his new bond without the current bond being refunded to him. All of this has caused him stress to lose his home of some four and a half years.
- There is a clear public interest in deterring landlords from trying to circumvent the termination provisions of section 51 RTA and, effectively, evicting tenants who are asserting their rights under the RTA. It is appropriate for the Tribunal to award the tenant exemplary damages of $2,500.00 and compensation for his expenses and stress of $1,000.00. Unlawful entry: discussion and decision
- 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. See section 48(1) and (2) RTA.
- Breaching this obligation is an unlawful act for which exemplary damages may be awarded up to a maximum of $1,500.00. See section 48 (4)(a) and Schedule 1A RTA.
- The parties agree that the landlord gave the required notice prior to the inspection. The tenant’s complaint is that the landlord carried out the inspection outside the permissible hour of 7 pm. However, the inspection started before that time when the landlord entered the property. More importantly, the tenant’s mother allowed the landlord access for the inspection and so it was carried out with the tenant’s consent.
- The tenant’s application is therefore dismissed. Breach of the tenant’s quiet enjoyment and privacy: discussion and decision
- A landlord must not interfere with the reasonable peace, comfort or privacy of the tenant in their use of the premises. See section 38(2) RTA.
- Breaching this obligation in circumstances that amount to harassment is an unlawful act for which exemplary damages may be awarded up to a maximum of $3,000.00. See section 38(3) and Schedule 1A RTA.
- Harassment means "to trouble, worry or distress" or "to wear out, tire, or exhaust" and "indicates a particular pattern of behaviour directed towards another person". MacDonald v Dodds, CIV-2009-019-001524, DC Hamilton, 26 February 2010.
- The specific incident about which the tenant has complained is the property reinspection with an unknown stranger present. This person was not an employee of the landlord or a business associate. The landlord explained that she was “a friend of another tenant”. Given the Tribunal’s finding regarding the ulterior purpose of this reinspection, the presence of a stranger with no legitimate purpose in the home of the tenant constitutes a breach of the tenant’s privacy.
- The Tribunal is not satisfied on the evidence before it that the purpose of the landlord in showing this person through the tenant’s home was to harass the tenant. The tenant’s claim for exemplary damages is therefore dismissed.
- However, the tenant is entitled to a modest sum in compensation for the breach of his privacy go through his home and view his personal possessions. It is appropriate to award the tenant a sum of $500.00 in compensation.
- Because [The applicant/s] has substantially succeeded with the claim I have reimbursed the filing fee.