Published tribunal order
Tenancy Tribunal case 5395924 — Exemplary damages at 5350 Kenepuru Road, Waitaria Bay, RD 2, Marlborough
Decided 11 May 2026 · Published 11 May 2026 · Application 5395924
- 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.
- By declaration, the premises is an unlawful residential premises.
Reasons
- The tenant attended the hearing. There was no appearance by the landlord. This follows previous non-appearance at the initial mediation and subsequent case conference. The tenant was adamant the landlord details are current, and he is aware of this application.
- A prior case conference concluded with a minute. Parts of that are copied below as background.
- The tenants’ claims were confirmed as seeking compensation and/or exemplary damages for the following claims: a. Failure of the landlord to meet its responsibilities (s 45 RTA), b. Quiet enjoyment (s 38 RTA), c. Bond not lodged (s 19 RTA), and d. Return of bond (s 22B RTA).
- Section 78A addresses unlawful residential premises. This section pertains to premises that cannot lawfully be occupied for residential purposes by the tenant. Given the limited evidence to date, there is some question as to the premises consented status (be it resource or building). Either party may want to respond further on this. The Tribunal can make orders per s 78A as appropriate, by its own initiative. This is a possibility.
- A party who brings a claim to the Tenancy Tribunal must prove on the balance of probabilities (more likely than not) that their version of events took place. Independent witnesses, corroborating documents and photographs are an important part of discharging this burden of proof.
- The issue of evidence at Tenancy Tribunal hearings was considered by the District Court in Kaipo v Clarke & McCarthy (DC) TT233/02. Judge Mather stated: “...[the applicant] needs to be reminded that like anyone who brings an application before a Tribunal or a 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.” Background
- The tenant first made enquiries about this property in May 2023 after a post by the tenant on the local Facebook community page, looking for accommodation. She was contacted by a neighbour who lives on the same driveway as the premises. She was to be the local point of contact for the landlord who it is believed is living in the North Island. The tenant was sent what she described as “some very outdated sales photos of the property which were beautiful but not how the property really was. Gave me a good idea of it and I knew the location.”
- Contact continued during 2024 as the tenant had to remain in Christchurch until March 2025. At that time the tenant had been offered a part time job starting in the April/May school term and discussions with the landlord were working to that.
- The premises is off-grid, with energy sourced via solar, generator or LPG. Water is tank stored. This was known to the tenant at the time. In December 2024 she inspected the premises with the neighbour. She had not lived in such an arrangement before.
- No written tenancy agreement was drafted or signed. The basic terms were set in an email. The tenant later used those terms to draft a written tenancy agreement that she signed. This was for the purposes of evidencing the tenancy to relevant agencies who were supporting her move but it was not signed by the landlord.
- A bond of $1,600 was paid, with rent set at $400.00 per week. There was a claim of some later agreement that the rent would be split with $270 to be paid to the landlord and $130.00 retained by the tenant for her significant maintenance and repair costs she was paying. The landlord did provide $400.00 towards a replacement califont sourced and paid for by the tenant.
- The move in date was delayed due to severe storms, flooding and road closures. The tenant delivered a furniture truck load. She said she arrived “to a messy section” and that “Inside the property there was NO POWER, NO GAS, NO LIGHTING”.
- She says she stayed the night on the couch and unloaded and left early the next morning.
- She said she told both her local contact and the landlord that nothing worked at that time.
- Upon her return to the property some weeks later nothing had changed. She has nominated 29 June 2025 as the tenancy commencement. The landlord has not appeared to challenge that date, so it is adopted although there appears to have been earlier entry but on undefined terms.
- There are extensive records of communication between the tenant and the landlord throughout the tenancy. The messages record the ongoing challenges for the tenant, and the landlord’s more blasé view of the issues and self- management expectations of the tenant. To be fair, the blasé approach appears to have extended to the lack of rent payments made over time.
- The tenant commented that she understands the new tenant has not experienced the same problems as she believes he has practical skills to manage and resolve some of the problems she experienced. In addition to some improvement made.
- The tenant had to undertake or arrange a number of maintenance tasks at her expense. Little rent ($670.00) was actually paid during the tenancy but a considerable sum expended on maintenance and enhancements that benefited the landlord.
Are the premises unlawful?
- Section 78A RTA provides that the Tribunal can determine if the premises are unlawful residential premises. That term is defined in the Act as For the purposes of this Act, unlawful residential premises means residential premises that are used for occupation for a person as a place of residence but— (a)that cannot lawfully be occupied for residential purposes by that person (whether generally or whether for the particular residential purposes for which that person is granted occupation); and (b)where the landlord’s failure to comply with the landlord’s obligations under section 36 or 45(1)(c)...has caused the occupation by that person to be unlawful or has contributed to that unlawful occupation.
- It further requires that (s 78A(3), despite anything to the contrary elsewhere in this Act, unless the Tribunal is satisfied that, having regard to the special circumstances of the matter, including the nature of the premises, it would be unjust not to make the order, the Tribunal must not order the tenant to pay to the landlord— (i) any sum found to be owing by way of rent in arrear; or (ii) any other sum by way of damages or compensation:
- The premises were offered and used for occupation by the tenant “as a place of residence”. It has been used as such before this tenancy, and subsequently.
- The tenant obtained advice from the Marlborough District Council regarding the premises consented status. Jeff Atkinson from MDC wrote to her advising, “The building on this property has been consented and constructed as a shed with a bathroom only. This is not a dwelling or a sleepout only an unlined shed with a bathroom. The installation of the kitchen is not consented and will be handed onto council compliance team to be investigated.”
- At some point, it appears the premises has been expanded or upgraded to change the use as intended and consented for to be.
- Sections 114 and 115 of the Building Act 2004 provide that an owner must give notice to Council when the owner changes the use of a building, and that an owner cannot change the use of the building unless the territorial authority has given consent. I note the council officer noted that the MDC planned to investigate compliance further.
- A change in use such as here should have been notified to MDC. Section 45(1)(c) of the RTA requires a landlord to comply with “all requirements of the buildings, health and safety so far as they apply to the premises”. The landlord’s failure to notify the MDC and obtain consent to change the use of the building is a breach of the Building Act and Building Code and therefore a breach of s 45 (1)(c) RTA.
- I am satisfied that as the landlord changed the use of the property; that the premises were unable to be lawfully occupied for residential purposes.
What is the appropriate remedy?
- Where it finds unlawful residential premises under s 78A(4), the Tribunal may order the landlord to (i) repay the tenant all the rent they paid; or (ii) a lesser amount of rent repayment that it finds fair having regard to the special circumstances of the case, including the nature of the premises.
- I consider that s 78A(4)(ii) should apply to this case because applying s 78A(4)(i) would be unfair to the landlord as the tenant has had some amenity of living at the property.
- I must carefully weigh what amount of rent it is fair to deduct. In considering this I have also factored in the rent due but unpaid by the tenant. It is for the landlord to establish it would be unjust to order any rent arrears or any other landlord claim (see s 78A(3)) but on a prima facie basis I struggle to see how that might be.
- The special circumstances I must have regard to are not stated in the RTA except for the nature of the premises nor have the higher courts determined what are ‘special circumstances’ that the Tenancy Tribunal should take into account when determining the rent reduction.
- However, the Tribunal has determined a number of claims under this provision and in line with those determinations I have taken into account the following: a.The landlord’s motivation for renting the property, and their conduct during the tenancy. b.The tenant’s motivation for renting the property and bringing the claim, and the length of and time she lived in the property. c.The benefits the landlord received in renting the property. d.The benefits the tenant received in renting the property. e.The seriousness of the regulatory breaches making the premises unlawful. f.Any other breaches by the landlord. g.Any detriment or loss the tenant suffered. h.The purpose of s 78A in ensuring landlords do not unfairly profit from unlawful premises. i.The public interest in discouraging unlawful tenancies. j.Any other compensation or exemplary damages that are ordered.
- The photographs provided to me of the property show property in poor condition. The lack of evident compliance, especially for gas and electrical supply when safety concerns existed, was a genuine concern of the tenant.
- It is in the public interest that when a landlord offers premises for a residential tenancy that they take all steps to ensure that those premises are lawful. Adherence to the Building Codes is important as those codes set out minimum standards such things as fire prevention and smoke alarms, insulation, ventilation, structural strength and integrity, escape routes for fire and sanitation.
- This situation involved the comfort of the tenant as well as the safety of the tenant. Further, it was left to her to manage a number of repairs. I am satisfied that it is appropriate that a substantial reduction in rent should be made.
- Using the tenant’s stated duration, the tenant has paid $670.00 towards rent of what would be $6,628.57 due at $400.00 a week. I consider that the rent liability should be reduced to 25% of this, being $1,657.14 with $670.00 paid, the final amount owing is $1,017.14. This rent liability is offset against costs incurred by the tenant for maintenance or repairs that should have been addressed by the landlord. The table below establishes what I accept as costs incurred by the tenant. Not all tenant claims have been accepted as a landlord liability. ExpenditureCost Grounds at commencement $ 75.00 Califont ($2,703.34 less $400.00 compensated $ 2,303.34 Generator battery $ 261.99 Solar setup $ 150.00 Pest treatment $ 65.00 Callout for battery charging $ 50.00 Generator repair to fuel line $ 50.00 Water pump maintenance $ 105.00 Generator service $ 80.00 $ 3,140.33
- Given this, I have offset the refund for expenditure by the rent due. That balances to a final sum of $2,123.19 (being $3,140.00 less $1,017.14).
- Specific factors that I have considered in determining the rent in this matter are: • The entry condition. • That the tenant has had to move twice in less than 4 months, and the associated moving costs. • The need for active tenant involvement and chasing of what should have been dealt with by the landlord or his local agent. • That the tenant brought the issues to the attention of the landlord very early on in the tenancy. • The lack of engagement by the landlord. • The impact on the tenant’s quiet enjoyment • The lack of anticipation by the landlord of the special challenges an off-grid property presents to someone expectant of a “turnkey” type arrangement. • That it is more than likely the landlord, did know or should have known that the premises was non-compliant and appears to need a resident will self-reliance skills that were not clearly stated before commencement. • I have not returned all rent to recognise some tenant beneficial use of the premises, including flexibility around commencement. Unlawful Acts
- The landlord has committed a number of unlawful acts. The tenant cited unlawful acts of the landlord to meet its responsibilities (s 45 RTA), quiet enjoyment being harassment (s 38 RTA), and bond not lodged (s 19 RTA).
Should exemplary damages be awarded?
- As I have determined that the landlord committed unlawful acts I must decide if it is appropriate to award exemplary damages.
- Exemplary damages under the Act are different from compensation. The provision of such damages is designed to punish and deter; Attorney-General (Commissioner of Crown Lands) v Little Bo Peep Sheep Company Ltd (HC CIV 2010-412-134).
- Where a party has committed an unlawful act intentionally, the Tribunal may award exemplary damages where it is satisfied that 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
- In Birch v Otautahi Community Housing Trust [2020] NZDC 17667 the Court said this: In considering whether an order of exemplary damages should be made, the Tribunal must first look at the intention of the person against whom the order is sought. As the Tribunal in Chief Executive, ex parte Edmondson v Walls TT548/92 said: Before an award of 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. Landlord’s responsibilities
- I have considered the landlords many failures under section 45 as part of the unlawful residential premises considerations. I consider that orders encompass any landlord breaches of s 45 and I make no further order for exemplary damages.
- Compensation for tenant costs incurred due to landlord failures that required remedying have been considered in the orders. Bond lodgement
- The landlord failed to lodge the bond with the Bond Centre within the required period.
- A landlord must send any bond payment to the Bond Centre within 23 working days after the payment is received (see s 19(1) Residential Tenancies Act 1986). This applies whether the bond is paid in part or whole.
- Breaching this obligation is an unlawful act for which the Tribunal may award exemplary damages up to a maximum of $1,500.00 (see s 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).
- 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).
- This informal tenancy lacked in many ways. The non-lodgement of the bond is consistent with other landlord procedural failures. I do not consider the landlord was acting unaware as there are previous bonds lodged at this address under his name. That history, as well as the ongoing contesting of the balance without the tenant having some protection of her money via the Bond Centre makes the award for exemplary damages move to a mid-point of the range. I award $750.00 exemplary damages for the landlord’s failure to lodge the bond. Quiet enjoyment
- The tenant is entitled to have quiet enjoyment of the premises without interruption by the landlord or any person claiming by, through, or under the landlord or having superior title to that of the landlord. Further, the landlord shall not cause or permit any interference with the reasonable peace, comfort, or privacy of the tenant in the use of the premises by the tenant.
- Contravention of this by the landlord in circumstances that amount to harassment of the tenant is an unlawful act.
- A landlord must not interfere with the reasonable peace, comfort or privacy of the tenant in their use of the premises (see s 38(2) Residential Tenancies Act 1986). 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 s 38(3) and Schedule 1A RTA).
- Where a party has committed an unlawful act intentionally, the Tribunal may award exemplary damages where it is satisfied that 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).
- 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).
- Black’s Law Dictionary defines harassment as: Words, conduct, or action (usu. repeated or persistent) that, being directed at a specific person, annoys, alarms, or causes substantial emotional distress in that person and serves no legitimate purpose.
- These definitions suggest there must be evidence of some ongoing intentional actions directed at a specific person which causes distress to them. Therefore, a single act of interference with the tenant’s quiet enjoyment would be unlikely to amount to harassment. However, in Whatiura v Shoulder [1987] NZTT Palmerston North TT 12/87, the Adjudicator noted that: although the term usually refers to repeated acts of some kind, I take the view that it can extend to a single act on one occasion of sufficient seriousness.
- The tenant entered the tenancy with a history of previous personal challenges and in anticipation of a fresh chapter. It was not to be. She talked of the past and ongoing “distress and anguish” and impacts on her mental health. This is acknowledged but given it was the lack of landlord engagement that drove a number of the tenancy issues, I do not consider the content of any communication from him to be such that it formed harassment. No unlawful act per s 38 RTA committed so no exemplary damages follow.
- As with landlord failures, the impacts of the tenant due to landlord action or inaction that interfered with her quiet enjoyment has been considered under the unlawful residential premises determination. Return of the bond
- Section 22B(2) Residential Tenancies Act 1986 provides that, where a tenant applies for refund of the bond, and the landlord seeks payment from the bond, the landlord must file an application setting out the details of the counterclaim. Because the landlord has not filed a counterclaim the bond is refunded in full to the tenant.
- There remains $701.00 of bond money with the landlord. That is returned to the tenant by order. Filing fee
- Because [The applicant/s] has substantially succeeded with the claim I have reimbursed the filing fee. Suppression
- Section 95A RTA states regarding suppression orders that the Tribunal must, on the application of a party that has wholly or substantially succeeded in proceedings, order that the party’s name or identifying particulars not be published, unless the Tribunal considers that publication is in the public interest or is justified because of the party’s conduct or any other circumstances of the case.
- Further, the Tribunal may, on the application of any party to proceedings or on its own initiative, having regard to the interests of the parties and to the public interest, order that all or part of the evidence given or the name or any identifying particulars of any witness or party not be published.
- The tenant requested suppression in her application. As she has been substantially successful, suppression is ordered. I have not included the address in the suppression order as I consider the public interest regarding this property outweighs any tenant interest, given the background to this application and the orders made.