How much money was awarded in case 4611374?

Verified claim lines are listed on this page.

What type of tenancy dispute was case 4611374?

The primary dispute was Rent arrears. Related themes: 14-day notice, Smoke alarms.

Where can I read the official tribunal order for case 4611374?

The official Ministry of Justice published order is available at https://forms.justice.govt.nz/search/Documents/TTV2/PDF/9224161-Tenancy_Tribunal_Order.pdf.

How much money was awarded in case 4611374?

Verified claim lines are listed on this page.

What type of tenancy dispute was case 4611374?

The primary dispute was Rent arrears. Related themes: 14-day notice, Smoke alarms.

Where can I read the official tribunal order for case 4611374?

The official Ministry of Justice published order is available at https://forms.justice.govt.nz/search/Documents/TTV2/PDF/9224161-Tenancy_Tribunal_Order.pdf.

63 Old Coach Way, Ramarama, RD 3, Drury 2579 Tenancy Tribunal Case 4611374 — Rent arrears

Q: What was the outcome of Tenancy Tribunal case 4611374?

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

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Order

No application for suppression has been made in this case and no suppression orders apply around publication of this decision.

The tenancy of Cheng Qi Wang, of 63 Old Coach Way, Ramarama, RD 3, Drury is terminated, and possession is granted to New Zealand Asia-Pacific Cultural Exchange Centre Limited immediately.

Cheng Qi Wang must pay New Zealand Asia-Pacific Cultural Exchange Centre Limited $58,000.00 immediately, being rent arrears to 18 July 2023.

Reasons

On 25 November 2021, the parties entered into a standard form tenancy agreement, using the tenancy agreement supplied by Tenancy Services (the Ministry of Business, Innovation and Employment). The tenancy was for a fixed term between 1 December 2021, until 25 March 2022. The landlord was “NZ Asia – Pacif Remington Riu Yin Ziang Zhao”. The sole tenant was Cheng Qi Wang. The rental was to be $1,000.00 per week.

The next day on 26 November 2021 a sale and purchase agreement was entered into between the vendor, “China NZ Entertainment & Investments Ltd” 1 and Cheng Qi Wang, for the sale of the premises. The settlement date was to be 25 March 2022.

As I understand matters, Mr Wang failed to comply with his obligations under the sale and purchase agreement. 1 As discussed at the hearing, there has been a change of company name, but both parties are in agreement that the company under both the tenancy agreement and sale and purchase agreement, is the same company.

In late June 2022 the parties agreed to defer the settlement date to 17 February 2023. Various conditions were agreed as set out in emails provided to the Tribunal. That included an email from 28 June 2022 in which the solicitor for the respondent / tenant set out what was understood to be a condition of the deferral, including: Our client will pay $1,000.00 as rental per week since 25/03/2022. The rights and obligations of each party as landlord and tenant will remain the same.

The solicitor for the vendor replied on 30 June 2022 confirming the terms the vendor would be agreeable to, including that: The purchaser will pay to the vendor on demand rent for the property at $1,000.00 per week (or part week) on and from 23 March 2022.

The rent ledger provided by the applicant shows that the respondent made 27 weekly rent payments of $1,000.00 between 1 December 2021, until 7 June 2022. No further payments were made, despite the respondent continuing to occupy the premises.

When further negotiations were not successful, the applicant has applied to the Tribunal for orders terminating the tenancy and ordering the payment of rent arrears. Various other ancillary orders were sought.

The respondent via his legal representative, disputed the jurisdiction of the tenancy Tribunal to consider the matter.

A hearing was convened in Pukekohe on 25 July 2023. In attendance was Mr Lee for the landlord, and Ms Hu for the tenant. There was no appearance by Mr Wang.

It is the case that at the commencement of the tenancy, the representatives requested an adjournment so that they could progress settlement of the dispute. The Tribunal declined the adjournment request. Ultimately there was a live question of whether the RTA applied in this case, and there was no reason that could not be determined at least. However in the course of the hearing, Mr Lee’s position changed, and he sought an order in relation to all matters that were the subject of the application.

Ms Hu submitted that the landlord has not had sufficient time to prepare for the hearing. I do not accept that. The landlord was notified of the claim on 17 July 2023, and is legally represented. Given the nature of the claim, and the statutory expectation that the Tribunal act expeditiously, I am not persuaded that the landlord has not had sufficient time to prepare.

As I indicated at the hearing, I would proceed at the very least to issue a decision on the question of jurisdiction, and that I would consider whether to also determine the application for rent arrears and termination and possession. I have determined further that the Tribunal should reach a finding in relation to the application to those other matters. Ultimately I accept that the parties will continue to work towards a settlement of the dispute leading to settlement, and there is no reason that cannot occur if an order for those other matters is issued. For the reasons I will set out shortly, I am satisfied that there is a residential tenancy that falls within the RTA. I have made a possession order, but that does not mean that the landlord needs to enforce that possession order immediately. Strictly speaking, the landlord has up to 90 days in order to enforce the possession order as set out in section 60(2) of the RTA. Applicants case

The applicant’s position is that the Tribunal has jurisdiction to consider this dispute, as it relates to a tenancy falling within the RTA. It was submitted that the RTA does not exclude the situation of a purchaser of a property, also entering into a residential tenancy under the RTA with the vendor. In this case it was submitted that the parties did contract back into the RTA.

The tenancy was originally a fixed term tenancy, but now would be a periodic tenancy under the RTA.

In concluding submissions Mr Lee referred to the District Court decision of Fetherston v Barfoot and Thompson Limited, which addresses situations where there is contracting back in.

The applicant agrees that section 5(1)(o) would apply, but in this case there has been contracting back into the RTA. Reference was made to the Tenancy Agreement which makes express reference to the RTA.

Mr Lee noted that the tenancy agreement is provided by Tenancy Services for residential tenancy purposes, not as clauses in a sale and purchase agreement. Respondents case

The respondents position is that Mr Wang is a purchaser in possession, and therefore has a licence to occupy the premises. The only reason Mr Wang was in possession of the premises is because he was intending to purchase it. The respondent referred to the High Court decision of Xu v Meng.

In the alternative the respondent submitted that the exclusion in section 5(1)(o) would apply because Mr Wang would be the tenant / purchaser of the premises with the landlord / purchaser. Therefore it was submitted that the case falls outside of the RTA.

In relation to contracting back into the RTA, it was submitted that the parties had not contracted into the RTA in writing, and therefore the RTA did not apply.

It was submitted that it would not make sense that the respondent undertake the improvements he did, if he were simply a tenant.

The tenant’s position is that the tenancy agreement is no more than a convenient template to record the parties agreement. More is needed to find there has been contracting in.

ANALYSIS

Jurisdiction of the Tribunal

Ms Hu submitted that the Tribunal does not have jurisdiction to consider this dispute, because the RTA does not apply.

The Residential Tenancies Act 1986 (RTA) confirms that the RTA will apply to all tenancies for residential purposes, except as specifically provided (section 4).

Ms Hu submitted that there is no ‘tenancy’ in this case, because Mr Wang is a purchaser in possession, and the written tenancy agreement merely sets out the parties agreement as to conditions around Mr Wang’s occupation of the premises pending the sale and purchase agreement concluding.

I find there is a ‘tenancy’ as defined in the RTA. Section 2 is the interpretation section, and that defines a ‘tenancy’ as follows: tenancy, in relation to any residential premises, means the right to occupy the premises (whether exclusively or otherwise) in consideration for rent; ...

In this case the premises are residential premises, and Mr Wang had a right to occupy the premises exclusively in consideration for rent. There is therefore a tenancy.

Ms Hu’s argument was that this was not a tenancy that falls within the RTA, because the evidence was not consistent with this being a tenancy. The factors that Ms Hu submitted showed that to be the case are: a. The Tenancy agreement was signed one day after the sale and purchase agreement. b. The dates on both agreements aligned c. The applicant did not require a bond to be paid. d. The tenancy agreement did not include some of the requirements such as information around insurance, smoke alarms etc. e. After moving in, Mr Wang spent a significant amount of money improving the premises. f. The only reason Mr Wang would have expected that money, is if he were intending to purchase the premises.

Ms Hu referred the Tribunal to the High Court decision of Xu v Meng [2021] NZHC 1936. I have considered that decision, and I am satisfied that it does not support the respondents position that the Tribunal does not have jurisdiction. In Xu, the applicant was the vendor seeking an order for the premises to be returned under the High Court Rules, which allow orders to be made for the recovery of land from ‘unlawful occupiers’. In the decision, the Court noted that the “definition of that term [in the Rules] expressly excludes occupiers holding over after the termination of a tenancy.“ In Xu the sale had fallen through, but the respondent (purchaser) remained in possession of the premises on the basis that a deposit paid for the purchase of the property had not been returned. Ultimately the Court determined that there was no tenancy in place between the parties, and therefore went onto find that the defendants were unlawful occupiers for the purpose of the High Court rules.

However the case before me differs to Xu, to the extent that I find there is a tenancy agreement, and that the parties have contracted back into the RTA. In Xu the Court confirmed: [32] In substance, the agreed basis for the defendants to occupy the Property is not in issue. The defendants clearly intended to purchase the land and were allowed to take possession prior to the settlement of the Agreement. This was done on the clear and express understanding that the defendants would become the de facto owners of the Property, assuming all outgoings, including mortgage, rates and insurance payments, that would otherwise be the responsibility of the plaintiffs. At no time have the defendants paid rent as such; the $200,000 is clearly a deposit and the other payments made are ordinarily the responsibility of the owners of the Property. ... [34] If the defendants were tenants, then they would, on the face of it, be the tenants of a residential premises subject to the Residential Tenancies Act 1986. However, purchasers under an agreement for sale and purchase are expressly excluded from that Act. That is no doubt a recognition of the fact that a different legal regime applies, namely ss 28 and 29 of the Property Law Act 2007 where a purchaser is in possession. Section 29 of the PLA requires a vendor seeking to cancel an agreement for sale and purchase where the purchaser is in possession, to give a notice to the purchaser that complies with specified, mandatory statutory criterion. ... [35] The exclusion of the RTA does not provide a complete answer to the question of whether the tenancy exception to Part 13 of the High Court Rules arguably applies here. It does, however, provide an indication that a purchaser in possession is in a different legal relationship with the owner of the property (than a tenant) and is subject to a different legal regime. [36] The meaning of “tenancy” and “tenant”, as defined in the RTA, is useful to the interpreting of the exception in r 13.1(b): tenancy, in relation to any residential premises, means the right to occupy the premises (whether exclusively or otherwise) in consideration for rent; and includes any tenancy of residential premises implied or created by any enactment; ... [37] The defendants do not fit within either of these definitions. There was never a tenancy to terminate and so the defendants have never been “holding over”. They have never paid rent, as such. They were purchasers in possession, but since the Agreement came to an end they have remained in possession without the plaintiffs’ consent and with no right to remain. Therefore, I reject Ms Pendleton’s submission there is an arguable case the Tenancy Tribunal has jurisdiction here.

There are two significant differences between Xu and the matter before the Tribunal, that is: a. In Xu no rent was paid. In order for there to be a ‘tenancy’ as defined in the RTA, the payment of rent is required. The respondents own solicitor has referred in communications on file, to the thousand dollar weekly payments as being rent. b. In Xu there was no tenancy agreement entered into between the parties, unlike the situation for Mr Wang.

The scheme of the RTA is to the extent that all residential tenancies are covered by the RTA, unless expressly excluded. In this case the exclusion found in section s5(1)(o) is relevant. That exclusion holds: where the tenant is the purchaser of the premises under an agreement for sale and purchase with the landlord as vendor, not being an agreement that is revocable at will by the vendor:

The parties agree that this provision would apply, but I make the observation that the tenancy agreement was entered into at a time there was no sale and purchase agreement, that came the following day. So as a minimum, section 5(1)(o) could not apply when the tenancy agreement was entered into.

As submitted by Mr Lee, section 8 of the RTA is also relevant, that provision holds 8 Parties to excluded tenancies may agree that Act shall apply (1) Nothing in any of sections 5 to 7 shall prevent the parties to a tenancy that would otherwise be excluded from this Act by virtue of any of the provisions of those sections, being a tenancy of any premises used or intended to be used for residential premises, from agreeing in writing that all or any of the provisions of this Act shall apply in respect of the tenancy, either without modification or with such modifications as they may so agree. (2) Without limiting subsection (1), any such agreement may confer upon the Tribunal, in respect of the tenancy, all or any of the jurisdiction conferred on the Tribunal by this Act in respect of tenancies to which this Act applies.

Because the Tenancy would otherwise be an excluded Tenancy under s5(1)(o), the question then becomes, whether the parties contracted back into the RTA, and for the following reasons I find they did.

As indicated above, the parties entered into a tenancy agreement on 25 November 2021, and it would not have been an excluded Tenancy that day, because there was no sale and purchase agreement for the premises completed until the following day. There is no evidence before the Tribunal that the parties agreed when executing the sale and purchase agreement, that the tenancy agreement would be cancelled, or otherwise not further operative. Rather there is compelling evidence that when the parties entered the tenancy agreement on 25 November 2021, that they had intended that agreement to apply until the settlement date. I assume on 25 November 2021 the parties had been negotiating for the sale of the premises to the respondent, so that fact that the date the fixed term tenancy ended, aligned with the settlement date, is strong evidence of an intention to have a valid tenancy over that intervening period.

Even if that were not the case, I agree with the submission of Mr Lee, that the standard form tenancy agreement makes reference to the RTA applying. Mr Lee referred to the District Court decision of Fetherson v Barfoot and Thompson Limited [2015] NZDC 12810. That case is on point. Just like in the instant case, there was a sale and purchase agreement entered into, as well as a standard form tenancy agreement, from which the payment of rent was agreed. The only difference being that a bond was also paid, but I do not consider that determinative. The tenancy agreement made reference to the RTA applying, with the Court concluding: It Is quite clear that the tenancy agreement imports all of the provisions of the act into the tenancy. The agreement is in writing signed by the necessary parties and plainly is intended to incorporate all of the provisions of the Act....Consequently, I am in no doubt that the Act applied to the tenancy and that the Tenancy Tribunal had jurisdiction.

I record for completeness, that subsection 2 of Section 8, simply means that if the tenancy is otherwise an excluded Tenancy, then the parties could agree to the Tribunal having jurisdiction in only limited parts of the RTA, but that is not relevant in this case, as there is no such limitation provided in the agreement to contract back in. As an example, the parties could have agreed that the Tenancy Tribunal would only have jurisdiction to consider the parties obligations around rent, but again there was no such limitation in this case.

I have considered the arguments made by Ms Hu for why the parties did not contract back into the RTA, but I am not convinced by them for these reasons: a. It was submitted at the Tenancy agreement was signed within a day of the sale and purchase agreement. I accept that is the case, but that is not evidence that the parties had not intended to contract back in. I can see no reason at all why the parties could not agree concurrently that there would be a residential tenancy falling within the RTA, while at the same time agreeing at a future date the premises would transfer to the tenant under the sale and purchase agreement. Section 8 allows contracting back in to what would otherwise be an excluded tenancy. b. It was submitted that the dates on both agreements aligned. That maybe so, but again that is not evidence that the parties have not contracted back in. As discussed above, I consider it strong evidence of an intention that there be a tenancy existing until settlement. c. It was submitted that the tenancy agreement did not require a bond to be paid. I agree, but it is not uncommon in this jurisdiction that a bond is not required by the landlord. It is not a requirement of the RTA that bonds be paid. In the Fetherston case a bond was paid, and the court found that to be evidence supporting an intention to contract into the RTA, but it would not be correct to say that the District Court had ruled that without a bond, there could not be contracting back in. It was just one factor pointing to a tenancy in that case. d. It was submitted that the tenancy agreement did not include some of the requirements needed in a tenancy agreement such as information around insurance, smoke alarms etc. I will express no ultimate view on the matter, but if the tenancy agreement did not comply with the landlords obligations under the RTA, that does not prove that there was no intention to contract into the RTA, but it may provide a basis for the tenant to pursue a claim for a breach on the part of the landlord, which could be a claim lodged with the Tenancy Tribunal. But again the fact that there was a breach of the obligations does not prove that the parties did not intend for the RTA to apply. e. It was submitted that Mr Wang subsequently expended a large sum of money improving the dwelling. I have no reason not to accept Ms Hu’s submission in that regard, but it is not determinative. It may well be that Mr Wang undertook that expenditure assuming that the sale would have progressed, but again that does not prove that he did not intend to enter into a binding tenancy agreement within the RTA for the period between the agreement being entered into, and the settlement concluding.

I also note, that no evidence has been provided from Mr Wang to the extent that he was not intending to contract into the RTA as proposed by his legal representative. Rather the Tribunal does have documentary evidence in the form of a completed standard form tenancy agreement, signed by Mr Wang, which does on the face of it, support a conclusion that he intended the RTA would apply.

Ms Hu submitted that the tenancy agreement used was simply a pro forma, or convenient way to record the conditions that would apply within the sale and purchase agreement. I do not accept that submission. There is no evidence before the Tribunal which would suggest that was the intention of the parties. I can see no reason why the parties could not have set out any terms such as the payment of rent, within the sale and purchase agreement, if it were intended to be the terms of the sale and purchase agreement.

For the above reasons, I conclude that the while this would be an excluded Tenancy under section 5(1)(o), the parties have contracted back into the RTA under section 8. I find therefore the Tenancy Tribunal does have jurisdiction to consider this matter. Rent arrears

The applicant seeks an order that the tenant to pay rent arrears, which as of 18 July 2023 were to the sum of $58,000.00.

Ms Hu provided no submissions, or pointed to any evidence, which suggest that the landlords calculation of the rent arrears were wrong, or that rent payments have been made and not accounted for. On that basis, I accept the rent ledger provided by the landlord as an accurate record of the rent situation, and accept that the rent arrears owed as of 18 July 2023, are $58,000.00 as claimed.

However, the tenant’s position is that the premises have been misrepresented, and that a set-off should be applied.

On a claim by a landlord to terminate a tenancy for rent arrears, the Tenancy Tribunal must consider whether the tenant has an equitable set-off against the landlord’s claim. A Set-off is a money claim which can be raised by ‘A’ as a defence to extinguish or reduce a money claim by ‘B’

The leading New Zealand case is Grant v NZMC Ltd [1989] 1 NZLR 8 (CA) at 12 to 13: The principle is, we think, clear. The defendant may set-off a cross-claim which so affects the plaintiff's claim that it would be unjust to allow the plaintiff to have judgment without bringing the cross-claim to account. The link must be such that the two are in effect interdependent: judgment on one cannot fairly be given without regard to the other; the defendant's claim calls into question or impeaches the plaintiff's demand. It is neither necessary, nor decisive, that claim and cross-claim arise out of the same contract.

See also Hamilton Ice Arena Ltd v Perry Developments Ltd [2002] 1 NZLR 309 (CA) at [39], approving Hill and Redman’s Law of Landlord and Tenant, Issue 35, paragraph 3384: .. a tenant has a right to set-off against rent cross-claims which arise not only out of the same contract as the claim (ie the lease), but also where the cross- claim arises directly out of the relationship of landlord and tenant or out of an agreement for lease, or otherwise where there is a sufficiently close connection between the transaction giving rise to the cross-claim for the equitable doctrine of set-off to apply.

A set-off is a defence to a claim, it is not a counterclaim of itself.

It is not clear to me whether the respondent’s position is that there has been a misrepresentation of the tenancy, or a misrepresentation of the premises for the sale. But in either case I would conclude a set-off would not apply.

In relation to the tenancy, I have heard no evidence from Mr Wang setting out how the tenancy for rental purposes has been misrepresented so as to be a basis for a set-off defence.

In relation to misrepresentation of the premises for sale, I cannot see any relationship between the decision not to pay rent for the premises, and the state or price of the premises. If the tenant considered the premises had been misrepresented, then his remedy would be to pursue dispute presumably in the High Court. But at this time the tenant has not paid the full price of the premises, so I cannot see that he has incurred any loss.

I find therefore, that the rent arrears is $58,000.00, and no set-off applies. Should the Tribunal order termination of the tenancy

Section 55 of the RTA applies. That provision confirms that when the rent is more than 21 days in arrears at the date of application, then the Tribunal shall order termination of the tenancy. That is the case here, so termination of the tenancy is ordered.

However, as I have noted above, it appears that the parties are in the process of working toward a settlement of the dispute. While I have ordered termination and possession to return to the landlord, the landlord will presumably elect not to enforce possession until after the settlement process or negotiations have concluded. As noted above, section 60(2) gives the landlord 90 days in order to enforce possession on this order. Other landlord claims

The landlord has sought further claims at the end of the tenancy such as in relation to goods or damage. Those claims would be premature. Those are normally claims advanced after possession has been returned. I make no orders in relation to those matters, but note that the landlord may bring a further claim in the future in relation to those matters if necessary.