What was the outcome of Tenancy Tribunal case 4387502?

The tribunal order states: No application for suppression has been made in this case and no suppression

How much money was awarded in case 4387502?

Property Damage: $2,500.00 awarded to tenant; Filing Fee: $20.44 awarded to tenant; Reimbursement Of Fixed Charges: $293.88 awarded to tenant

What type of tenancy dispute was case 4387502?

The primary dispute was Exemplary damages.

Where can I read the official tribunal order for case 4387502?

The official Ministry of Justice published order is available at https://forms.justice.govt.nz/search/Documents/TTV2/PDF/9272545-Tenancy_Tribunal_Order.pdf.

What was the outcome of Tenancy Tribunal case 4387502?

The tribunal order states: No application for suppression has been made in this case and no suppression

How much money was awarded in case 4387502?

Property Damage: $2,500.00 awarded to tenant; Filing Fee: $20.44 awarded to tenant; Reimbursement Of Fixed Charges: $293.88 awarded to tenant

What type of tenancy dispute was case 4387502?

The primary dispute was Exemplary damages.

Where can I read the official tribunal order for case 4387502?

The official Ministry of Justice published order is available at https://forms.justice.govt.nz/search/Documents/TTV2/PDF/9272545-Tenancy_Tribunal_Order.pdf.

Unit/Flat 1, 9 Heaphy Street, Blockhouse Bay, Auckland Tenancy Tribunal Case 4387502 — Exemplary damages

Claims and awards in Tenancy Tribunal application 4387502 — net $2,814.32 NZD. Amounts reconciled from the published order (claims sum and net total). Verify on MoJ.
Claim	Tenant	Reason
Reimbursement of fixed charges	$293.88	Reimbursement of fixed charges
Exemplary damages - unlawful notice	$2,500.00	Exemplary damages - unlawful notice
Filing fee reimbursement	$20.44	Filing fee reimbursement
Net award	$2,814.32
Total payable by Landlord to Tenant	$2,814.32

Claims and awards in Tenancy Tribunal application 4387502 — net $2,814.32 NZD. Amounts reconciled from the published order (claims sum and net total). Verify on MoJ.
Claim	Tenant	Reason
Reimbursement of fixed charges	$293.88	Reimbursement of fixed charges
Exemplary damages - unlawful notice	$2,500.00	Exemplary damages - unlawful notice
Filing fee reimbursement	$20.44	Filing fee reimbursement
Net award	$2,814.32
Total payable by Landlord to Tenant	$2,814.32

Order

No application for suppression has been made in this case and no suppression orders apply around publication of this decision.
Client First Limited And Jag Bhushan Bhargava and Poonam Bhargava must pay Syed Ali Murtaza $2,814.32 immediately, calculated as shown in the table below.

Reasons

This matter relates to Mr Murtaza’s tenancy at 1/9 Heaphy Street, Blockhouse Bay, Auckland. The tenancy started on 1 February 2016 and ended on 18 June 2022.
The tenant (Mr Murtaza) has filed an application against the landlord (Client First Limited) seeking orders under the following sections of the Residential Tenancies Act 1986 (“RTA”): a. Section 39(4)(c) – reimbursement of fixed charges for 62 months and exemplary damages. b. Section 60AA—exemplary damages for the landlord giving a notice to terminate the tenancy (under section 51(2)(f)) knowing that they are not entitled to do so.
The party making the claim, in this case the tenant, bears the onus of proving his claim “on the balance of probabilities”. This means that he must prove with evidence that his claim is more likely than not, correct.
I will address the issues in turn. Although I have reviewed all the parties’ evidence and submissions, I have only referenced what I find necessary to give context to my decision.

Who is liable for payment of fixed charges?

The tenant is responsible for charges in respect of the supply of water provided to the premises on the basis of consumption. See section 39(4)(c) RTA.
The tenant is responsible for all outgoings exclusively attributable to their occupancy or use of the facilities. See section 39(3) RTA.
The landlord is responsible for all outgoings in respect of the premises that are incurred whether or not the premises are occupied. See section 39(1) RTA.
The tenant says that since his tenancy commenced on 1 February 2016 up until March 2021, he paid the entire water bill as requested by his landlord. This included him paying the wastewater fixed charge as per his tenancy agreement. However, he understands that this is not consistent with the RTA and that he was not liable for the fixed water charge component of the WaterCare bill.
The tenant therefore claims $4.74 (per month wastewater fixed charge) at 62 months (Feb 2016 to Mar 2021), totalling $293.88 in reimbursement for wastewater fixed charges. He also claims exemplary charges for the landlord’s unlawful act under 109(3) RTA.
In this case, the water supplier is, WaterCare. I find WaterCare’s regular water charge, based on consumption, is the responsibility of tenant (section 39(4)(c) of the RTA). Wastewater charges that are calculated according to a tenant’s consumption (as determined by the water meter) are “exclusively attributable” to the tenant and therefore the tenant’s responsibility (section 39(3) of the RTA). Any fixed charge outgoing is the responsibility of the landlord under section 39(1) of the RTA.
While the tenant may have initially agreed to pay the entire water bill, he was not fully aware of the different components at the time. In any event, section 11(3) of the RTA provides that any purported waiver by a tenant of any right or power conferred upon tenants by the Act shall be of no effect. In other words, the tenant cannot contract out of the Act to their detriment. Given that the tenant cannot waive his rights under the Act, he cannot be asked to honour their “agreement” to pay for a fixed component of water charges for which he is not liable to pay in the first instance. Therefore, in conclusion, I find that the tenant was liable to pay the water and wastewater component of the WaterCare bill. However, section 39 does not permit fixed charges to be passed on to the tenant.
The landlord did not dispute the tenant’s claim and agreed by consent to the reimbursement of $293.88 for wastewater fixed charges.
There is no basis under the RTA for awarding exemplary damages for a breach of section 39, regarding the wastewater fixed charges. Therefore, the tenant’s claim for exemplary charges is dismissed.

Has the landlord breached their obligations under section 60AA?

A landlord must not give a notice to terminate the tenancy knowing they are not entitled to do so. Breaching this obligation is an unlawful act for which exemplary damages may be awarded up to a maximum of $6,500.00. See section 60AA and Schedule 1A RTA.
In this case, the landlord gave the tenant notice on 19 April 2022 under section 51(2)(f) RTA. Under Section 51(2)(f), one of the reasons for terminating a periodic tenancy is where extensive alterations, refurbishment, repairs, or redevelopment of the premises are to be carried out by the landlord or owner. In these circumstances, the landlord would need to show that, aside from it not being reasonably practical for the tenant to remain in possession, that the work is to begin, or material steps towards it are to be undertaken within 90 days after the termination date.
The landlord issued the notice to end the tenancy on 19 April 2022 with the end date being 19 August 2022. The tenant subsequently gave notice on 21 May 2022 and vacated the tenancy on 18 June 2022.
The tenant says the notice given by the landlord was unlawful as the landlord did not do any extensive alterations, refurbishment, repairs, or redevelopment of the premises and listed the property again from 1 August 2022. The tenant expressed concerns that his family were made to pack up their lives on false grounds after living 7 years in Blockhouse Bay. The impact was that they paid a heavy price socially and financially for the landlord’s actions.
In support of their reliance on the need to give the tenant notice to carry out renovation work, the landlord relied on a quote from Lloydsons construction Ltd. The work to be carried out is described as “Prepping whole house interior and painting/ kitchen cavity remodel and exterior waterblasting”. The project time frame was 2 weeks.
The landlord further submitted that due to financial circumstances the owner intended in June 2022 to put the property on the market for sale. The landlord relied on an email query in June 2022 regarding market conditions. However, as the market had dropped the owner decided to hold off putting the property on the market and to relet the property out again until the market improved.
The tenant was critical of the evidence relied on by the landlord. The tenant argued the claimed invoice presented by the landlord was just a quotation as referenced by the builder in the email subject line. He also noted it was issued a day after he had vacated. He further submits that in any event the work alluded to could have been done without him and his family having to move out.
After considering all the available evidence, I find the nature of the renovation work proposed by the landlord, consisting of doing a whole house interior prepping and painting, updating of the kitchen and exterior water blasting, do not appear from the evidence provided, to involve extensive alterations or refurbishment.
I am not satisfied that the landlord has proved that the proposed renovation work was so extensive that it would not be reasonably practicable for the tenants to remain in occupation of the premises.
on the contrary, I consider the renovation work could have been done while the tenancy continues.
In summary, I am not satisfied that the landlord has established all the key elements required of section 51(2)(f) in giving the termination notice under that section. Therefore, I find the notice to terminate was invalid.
The issue to determine for a breach of section 60AA is whether the landlord gave the notice knowing they were not entitled to do so. The generally accepted legal definition of “knowledge/knowing” is that a person has actual knowledge, full awareness and consciousness. It also covers a person who should have known of the circumstance or result and includes acting with deliberate ignorance or reckless disregard for the prohibition, often described as wilful blindness or indifference.
There are several factors which persuade me that the landlord and/or owner knew or ought to have known that they were not entitled to give the termination notice. • I find the landlord did not properly consider whether the grounds for termination under section 51(2)(f) were met. • There is limited evidence regarding firm plans for intended works prior to the tenancy ending. • The landlord cannot justify a termination notice given in April 2022 on the basis of a quote obtained from a builder in June (towards the end of the tenancy) regarding the proposed renovation work. • The landlord has also not convinced me that it would not have been practicable to live in the premises during the proposed work. • There is no comment from a suitably qualified contractor commenting on whether the work could not be reasonably done while the tenants are in occupation. • In any event, it is clear there were no extensive alterations or refurbishment carried out by the landlord. • The landlord has not been consistent, and has not established to the required standard that the reasons given for the notice were genuine. • If the owner changed their mind and intended to put the property on the market for sale, then they needed to withdraw the notice and give another notice.
After carefully considering all the available evidence, I find that when the landlord issued the termination notice, they likely did so, knowing that the grounds for termination were not satisfied. At best, it was issued with a reckless disregard for, or ignorance of, the applicable law. Landlords know, or ought to know, that terminating a tenancy is a serious matter which causes major upheaval and disruption for tenants. It should never be done lightly and without proper grounds. For that reason, a landlord must take care to ensure that they understand the grounds for termination and whether they are met. I find that the landlord did not do so, and has committed an unlawful act under section 60AA.
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.
An intentional act is a deliberate act, not a negligent or careless oversight. However, the District Court in Parton v Fifita TT 1815/00, DC Auckland,1/5/2001 has said that only the act must be intentional—i.e. that the person intended to do whatever it was they did or did not do. They do not have to realise that the act is unlawful. See also the District Court in TMT New Zealand Limited TA Strata Property Management v Sweeney and Sundahl [2021] NZDC 16182 which stated: “Like all citizens, corporate or otherwise, he and his company are deemed to know the law and on that basis a failure to provide these fundamental documents is properly seen as intentional. Parliament’s intention would be subverted if landlords were able to escape consequences for the unlawful acts involved by claiming ignorance of the law.”
I am satisfied that the landlord acted intentionally. The effect on the tenant was the unnecessary end of a six year tenancy, and the need to find somewhere else to live. This had been stressful. It is in tenants’ interests that 90-day notices are not used without cause, and there is public interest that landlords who issue notices without cause pay exemplary damages. I allow $2500 in exemplary damages. This is at the lower end of the scale because I am not aware of any previous, similar orders against the landlord. Filing fee
As the tenant has been substantially successful with the application, I consider it reasonable to order the other party to reimburse the filing fee. Liability of the agent
The tenants’ claim is against the agent. The owner is Jag Bhushan Bhargava and Poonam Bhargava.
There are a number of authorities that deal with the issue of whether agents, owners, or both are liable under a tenancy agreement. The answer usually involves a consideration of the parties’ intent (based on a consideration of the tenancy agreement and all background facts), the principles of agency law, and the extended definition of landlord in the RTA. The extended definition of ‘landlord’ in section 2 RTA which provides that a landlord is the “grantor of a tenancy of the premises: and, where appropriate, includes – (e) An agent of a landlord”.
In the case of Mumby & Agrenz v Gary Brown Ltd (CIV 2010-044-2067), DC North Shore, 07/02/11) the Court considered whether the agent, the owner, or both were liable to the tenant. In that case, although the tenant knew that the agent was acting in that capacity, the Court held that it was nevertheless liable to the tenant (jointly and severally with the owner).
I am satisfied that Client First Limited was acting as an agent in all respects of the tenancy and in the capacity as the landlord. Therefore, this is a situation where it is appropriate for both the owner and the agent to be liable to the tenant as landlord.
The next issue is whether it is appropriate to join the owner as a party and make an order against them. The question is whether to do so would be procedurally fair. In many situations an application for joinder will necessitate an adjournment so that the proceedings can be served on the owner, particularly where the interests of owner and agent may conflict, or where the agent no longer acts for the owner. It is reasonable to assume that the owner is aware of the proceedings, the substance of the claims made, and consents to the agent representing the owner. Joining the owner as a party does not give rise to any new factual issues that might necessitate further evidence being called. Therefore, I am satisfied that this is an appropriate case to join the owner as a party. Whether the order is made against the owner, the agent, or both, those parties will have to resolve between themselves who ultimately bears the burden of any costs ordered.

Tenancy Tribunal case 4387502 — Exemplary damages at Unit/Flat 1, 9 Heaphy Street, Blockhouse Bay, Auckland

At a glance

Tenancy Tribunal case 4387502 — Exemplary damages at Unit/Flat 1, 9 Heaphy Street, Blockhouse Bay, Auckland

At a glance

Award balance

Claims & awards

Dismissed claims

Order

Reasons

Who is liable for payment of fixed charges?

Has the landlord breached their obligations under section 60AA?

Topics & place

Residential Tenancies Act sections

Key findings

Property management

Frequently asked questions

Award balance

Claims & awards

Dismissed claims

Order

Reasons

Who is liable for payment of fixed charges?

Has the landlord breached their obligations under section 60AA?

Topics & place

Residential Tenancies Act sections

Key findings

Property management

Frequently asked questions