Published tribunal order
Tenancy Tribunal case 5300119 — Rent arrears at 7 Plowman Crescent, Onekawa, Napier 4110
Decided 5 Nov 2025 · Published 5 Nov 2025 · Application 5300119
- Rent arrears
- Property damage
Order
- [The tenant/s] tenant/s] must pay Rentsmart NZ Limited $7,432.65 immediately, calculated as shown below.
Reasons
- The landlord attended the hearing. The tenant did not attend and couldn’t be contacted on the phone number given in the application.
- The landlord has applied for rent arrears, compensation, refund of the bond, and reimbursement of the filing fee following the end of the tenancy. Background
- The tenancy began on 11 November 2020. The agreement was entered into between the tenant and Rent-A-Home Ltd as agent for the owner.
- Rentsmart NZ Limited, the current property manager, was appointed in March 2025.
- The current property manager’s understanding is that Rent-A-Home Limited managed the tenancy for a year or so, then the owner took over direct management until Rentsmart was appointed.
- The records indicate that regular inspections were conducted during the first year by Rent-A-Home, but none were carried out by the owner during its direct management.
- The tenant gave 21 days’ notice of termination on 7 March 2025, ending the tenancy on 28 March 2025.
- After Rentsmart was appointed its property managers carried out an inspection and reported a large number of issues with the condition of the property.
How much is owed for rent?
- The landlord provided rent records which prove the amount owing at the end of the tenancy. The amount order takes into account the bond of $1,840.00 released to the landlord on 6 May 2025.
Did the tenant comply with their obligations at the end of the tenancy?
- At the end of the tenancy the tenant must leave the premises reasonably clean and tidy, remove all rubbish, return all keys and security devices, and leave all chattels provided for their benefit. See section 40(1)(e)(ii)-(v) Residential Tenancies Act 1986.
- The routine and exit inspection photographs show that the premises had not been kept in a reasonably clean and tidy condition. After the tenant vacated a very large quantity of rubbish was left, the premises were not clean, there was a vermin infestation, broken glass and damage caused by rats.
- The landlord paid contractors to clear all the rubbish from the premises and grounds. The invoice provided proves the cost. The landlord should be reimbursed.
- The tenant should also compensate the landlord for the cost of glass repairs, as shown by the invoice provided.
- The landlord had an assessment of the carpets completed. The assessment report from JAE dated 7 May 2025 notes, “Upon entry there was smashed glass on the floor. Could smell very strong odour of possible cat urine, and I could see from the doorway that there was mould that looked like white powder on the carpet. Holes in the carpet and mouse hole in the hallway cupboard with mouse droppings on the shelves.....I could see that each room had possible cat urine in it (we say possibly as definitely urine and smelt like the strong odour of cat).........There was no carpet that could be saved in this property.”
- The need for that assessment was a reasonably foreseeable cost arising from the tenant’s breach and should be compensated.
- The landlord had the carpets disposed of and had new carpet installed.
- The curtains were missing or needed to be disposed of. The landlord replaced them.
- The landlord had a replacement heat pump unit installed. The installer noted that he, “...found extensive damage on the indoor unit caused by a rat infestation.”
- The landlord lodged an insurance claim which was declined by the insurer on the basis that, “The Loss Adjuster reported on multiple events. The damage is a mixture of damage caused by pets, gradual damage and vermin. There are potentially some damages that are sudden and accidental but as an excess is applied per event, these all fall under excess.”
- The landlord also claims that a dryer provided by the owner was removed by the tenant.
Is the tenant responsible for the damage to the premises?
- A landlord must prove that damage to the premises occurred during the tenancy and is more than fair wear and tear. If this is established, to avoid liability, the tenant must prove they did not carelessly or intentionally cause or permit the damage. Tenants are liable for the actions of people at the premises with their permission. See sections 40(2)(a), 41 and 49B RTA.
- Where the damage is careless and is not covered by the landlord's insurance, the tenant's liability is limited to four weeks' rent (or market rent). See section 49B(3)(b) RTA. Where insurance money is irrecoverable because of the tenant's conduct, the property is treated as if it is not insured against the damage. See section 49B(3A)(a) RTA.
- Damage is intentional where a person intends to cause damage and takes the necessary steps to achieve that purpose. Damage is also intentional where a person does something, or allows a situation to continue, knowing that damage is a certainty. See Guo v Korck [2019] NZHC 1541.
- As this was a 4 ½ year tenancy, I can infer that the vermin problem and the damage from it, resulted from the tenant’s occupation of the premises, not any pre-existing infestation of the premises.
- The property manager’s evidence is that the carpets and curtains were newly installed at the beginning of or during this tenancy. Therefore, the damage shown at the end of the tenancy must have occurred during it.
- The damage to the carpet from pet urine should be regarded as intentional. Applying the principle in Guo v Korck, it must have been apparent to the tenant that allowing pets to continue urinating on the carpet would result in that damage.
- The same is true of the damage caused by the vermin infestation. The tenant must have been aware of the problem and that if steps weren’t taken to deal with it or with the accumulation of rubbish and waste that provided a habitat for the vermin, damage to the premises would likely occur.
- My finding is therefore that the limitation on the tenant’s liability for damage under s. 49B(3)(b) RTA does not apply here. The tenant must compensate the landlord for losses arising from damage caused by breach of his obligations to keep the premises in a reasonably clean and tidy condition and not to cause damage to them.
- In assessing what compensation to award, the Tribunal must take into account: a. the repair/ replacement cost, as proved by the invoices submitted; less b. allowance for depreciation of depreciating chattels.
- The property manager’s evidence satisfies me that the curtains, carpets and heat pump unit were replaced like with like so no allowance for improvement value is required.
- In assessing the depreciation allowance, I apply the IRD depreciation tables applicable to residential rental properties. Carpets
- The tables give an expected useful life of 8 years. I calculate the loss and compensation payable as the replacement cost (including the cost of removing the damaged carpet) ÷ 8 (their expected life) x 3.5 (the remaining expected life of the carpets after a 4 ½ year tenancy). Curtains
- The same calculation is used. They also have an 8 year expected life. Heat pump
- The same approach is taken but on the basis of an expected life of 10 years. Dryer
- The dryer is not included as a landlord chattel in the tenancy agreement.
- The property manager says the landlord bought and provided a dryer during the tenancy. That is corroborated by a receipt for purchase of a Living and Co dryer dated 16 May 2022.
- Photographs from the inspection on 20 March 2025 show a living and Co dryer in the premises.
- I find it proved, on balance, that the landlord provided a dryer which was not returned at the end of the tenancy. The landlord should be compensated.
- I assess compensation on the basis that the dryer was 3 years old at the end of the tenancy against an expected life of 6.66 years. Mitigation
- In the circumstances of this case, I need to consider whether the landlord has met its obligation under s.49 RTA to, “....take all reasonable steps to limit the damage or loss arising from [The tenant/s] tenant’s] breach, in accordance with the rules of law relating to mitigation of loss or damage upon breach of contract.”
- British Westinghouse Electric and Manufacturing Co v Underground Electric Railway Co of London 1 describes the principles applying to mitigation of loss as being: “[T]he law does not allow [a claimant] to recover damages to compensate him for his loss which would not have been suffered if he had taken reasonable steps to mitigate his loss. Whether a claimant has failed to take reasonable steps to mitigate as a question effect depending on the particular circumstances of each case.
- In a residential tenancy context, the District Court has confirmed that the principle applies to a landlord’s failure to take reasonable steps to prevent ongoing 1 British Westinghouse Electric and Manufacturing Co v Underground Electric Railway Co of London [1912] AC 673 accumulation of rent arrears even though there is a fundamental obligation on the tenant to pay rent when due 2
- The primary responsibility for the cleanliness of premises lies with the tenant. He is required to keep the premises reasonably clean and reasonably tidy and not to cause damage. 3
- There are however steps available to the landlord under the RTA that would have allowed earlier intervention and might have encouraged the tenant to remedy their breaches by rehoming pets causing carpet damage or taking steps to address the accumulation of rubbish and presence of vermin on the property. Had that happened, it may have avoided or reduced the costs incurred by the landlord in repairing damage, which the landlord is now seeking to recover from the tenant.
- Landlords have specific rights to enter rented premises to carry out inspections. There is no evidence explaining why the owner chose not to exercise those rights.
- It seems to me from the evidence presented with this claim that if the landlord had done so, it would have been quite apparent that the tenant was breaching his obligation to keep the premises in reasonable condition and steps could have been taken to require remedy of that breach.
- Although there is no legal requirement for a landlord to conduct inspections of the premises, s.49 does create a positive obligation on the landlord to take reasonable steps to mitigate the loss arising from the tenants’ breach.
- In these circumstances it would have been reasonable for the landlord first to conduct inspections, then if required, to issue notices to remedy under s.56 RTA, making it clear that the tenant was in breach of the obligation to keep the premises in reasonably clean and tidy condition and that the tenancy could be ended if not remedied.
- The tenant being made aware that the tenancy was at risk if he didn’t remedy those breaches, would likely have been a powerful incentive to address them, which is the intent of those provisions.
- No such steps were taken and I find the owner breached its obligations under s.49.
- There is no certainty about what would have happened had the landlord taken those reasonable steps. In my view though there is a distinct possibility that, in terms of the British Westinghouse principles, the landlord’s claim includes recovery of “.....damages to compensate him for his loss which would not have been suffered if he had taken reasonable steps to mitigate his loss.” 2 Eg. Huang v Ashworth [2024] NZDC 15726 3 S.40(1)(a) and 2(a) RTA
- Allowance for that breach of the landlord’s obligations is appropriate. I assess that allowance as 25% of the compensation awarded for damage to/ cleaning of the premises (ie. excluding rent arrears and removal of the dryer).
- Because Rentsmart NZ Limited has substantially succeeded with the claim I must reimburse the filing fee.