What was the outcome of Tenancy Tribunal case 4744271?

The tribunal order states: By way of declaration, Katherine Gong was the landlord and Qing Mei Li was

How much money was awarded in case 4744271?

Verified claim lines are listed on this page.

What type of tenancy dispute was case 4744271?

The primary dispute was 14-day notice. Related themes: Exemplary damages, Boarding House.

Where can I read the official tribunal order for case 4744271?

The official Ministry of Justice published order is available at https://forms.justice.govt.nz/search/Documents/TTV2/PDF/9757202-Tenancy_Tribunal_Order.pdf.

What was the outcome of Tenancy Tribunal case 4744271?

The tribunal order states: By way of declaration, Katherine Gong was the landlord and Qing Mei Li was

How much money was awarded in case 4744271?

Verified claim lines are listed on this page.

What type of tenancy dispute was case 4744271?

The primary dispute was 14-day notice. Related themes: Exemplary damages, Boarding House.

Where can I read the official tribunal order for case 4744271?

The official Ministry of Justice published order is available at https://forms.justice.govt.nz/search/Documents/TTV2/PDF/9757202-Tenancy_Tribunal_Order.pdf.

128 Grafton Road, Grafton, Auckland 1010 Tenancy Tribunal Case 4744271 — 14-day notice

Order

By way of declaration, Katherine Gong was the landlord and Qing Mei Li was the tenant under a periodic residential tenancy agreement of the premises at 128 Grafton Road, Grafton, Auckland 1010 from 4 July 2023 to 4 December 2023.
The Bond Centre is to pay the bond of $2,720.00 (5642722-002) to Qing Mei Li immediately.
No other orders are made.

Reasons

Both parties attended the hearing, conducted by teleconference. The tenant is now residing in China and a neighbour, Mr Geoffrey Hoey, was pre-approved to represent her at this hearing.
I firstly address the issue of jurisdiction of the Tenancy Tribunal to hear the tenant claim filed against the landlord.
By a house sharing agreement entered into between Katherine Gong as Landlord and Qing Mei Li as Flatmate on 11 June 2022, Ms Gong agreed to rent a self-contained part of the large house at this address to Ms Li.
A bond of $2,720.00 was required and paid.
Ms Gong lives in the same house. I heard she occupies one self-contained flat herself, and this premises was one of five other self-contained flats. Ms Li had the full and exclusive possession of the self-contained flat she rented at 128 Grafton Road for $680.00 per week.
The material issue before me is whether Ms Li should be deemed a tenant under a residential tenancy agreement with Ms Gong as her landlord after she entered into the flat/house sharing agreement with Ms Gong and moved into the property on 4 July 2023.
Section 10 RTA requires where any party contends that this Act does not apply in respect of any tenancy of any residential premises, it shall be for that party to establish the facts upon which it is contended that this Act does not apply. In this case, that onus falls on Ms Gong as landlord.
For the reasons below I find that the parties are under a residential tenancy agreement as landlord and tenant.
Ms Gong is the landlord because she granted Ms Li a right to occupy the property in consideration of rent. Ms Li is a tenant because she was a grantee of a tenancy of property under that agreement.
The label that the parties place on their residential tenancy arrangement is not determinative of the parties’ legal status.
Section 4 Residential Tenancies Act 1986 (‘RTA’) provides that the RTA applies to every tenancy for residential purposes except as specifically provided.
This arrangement is one of five 5 separate premises within a large house. The sixth premises is occupied by Ms Gong. I was not told of any communal facilities. Each tenant has the exclusive use of their own rooms and separate access.
Section 2 RTA sets out the following material definitions: 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; and, where appropriate, also includes a former tenancy residential premises means any premises used or intended for occupation by any person as a place of residence, whether or not the occupation or intended occupation for residential purposes is or would be unlawful tenancy agreement, in relation to any residential premises, means any express or implied agreement under which any person, for rent, grants or agrees to grant to any other person a tenancy of the premises; landlord, in relation to any residential premises that are the subject of a tenancy agreement, means the grantor of a tenancy of the premises under the agreement tenant, in relation to any residential premises that are the subject of a tenancy agreement, means the grantee of a tenancy of the premises under the agreement
Section 11(1) provides that any agreement or arrangement, or any provision of any agreement or arrangement, entered into in respect of a tenancy to which this Act applies, that is inconsistent with any of the provisions of this Act, or that purports to exclude, modify, or restrict the operation of any such provision, shall be of no effect unless— (a) the inconsistency, exclusion, modification, or restriction is expressly permitted by this Act; or (b) the Tribunal is satisfied that, having regard to the nature of the tenancy, the provisions of the tenancy agreement, the interests of the parties, and all other relevant circumstances of the case, the inconsistency, exclusion, modification, or restriction should be permitted.
Notwithstanding the form of the flat/house sharing agreement entered into by the parties,
Section 5 of the RTA details exclusions to the RTA. Section 5(n) specifically excludes arrangements where the premises are being used for residence by the landlord or family. This section envisages owners of a home renting out their spare rooms in a flatmate or boarding type situation.
The exception to this exception is if the premise is a boarding house. A boarding house is defined in section 66B of the RTA as residential premises containing one or more boarding rooms along with facilities for communal use by the tenants of the boarding house that is occupied, or intended by the landlord to be occupied, by at least six tenants at any one time. I do not consider this a boarding house situation, despite there being a number of premises within the large house. I was told each has their own entrance and consists of self-contained room(s). There was no common area or house rules. Each tenant lives relatively independently within their premises.
A ‘flatmate’ resides in the premises by way of a licence from the owner of the premises In Musson v Dobrisek & Ors DC Lower Hutt CIV-2006-032-36, 5 May 2006, Judge Broadmore considered the definition of a flatmate. He states (at para [22]: “By ‘flatmates’ I understand a co-operative arrangement whereby, in a functional sense, all occupants are on the same footing in that they have exclusive occupation of their own rooms and shared use and occupation of common areas such as kitchens.”
As previously noted, there was little evidence of cooperative coexistence between the tenancies, such that a flatting arrangement might exist. In the upshot, the house share/flatting agreement label is clearly and patently inconsistent with the provisions of the RTA and, to the extent that any of its terms purports to exclude, modify or restrict the operation of any such provision of the RTA, they shall be of no effect.
In Holler & Rouse v Osaki [2016] NZCA 130, the Court of Appeal stated that the Residential Tenancies Act 1986 is “consumer protection legislation”. Where there is any uncertainty as to whether any particular arrangement falls within the scope of the RTA, consideration of this consumer protection aspect of the RTA ought to weigh in favour of bringing the arrangement under the umbrella of the Act, and giving the tenant (and the landlord) access to the remedies that the Tenancy Tribunal can provide.
Consequently, I read into that house sharing/flatting agreement the relevant terms as if a proper tenancy agreement had been entered under the RTA.
A key determination here is that the fixed-term period of one year in the flatting agreement is not considered binding. The agreement is considered a periodic tenancy because the insertion of clause 5 in the flatting agreement whereby the landlord could terminate the tenancy by giving 14 days’ notice undermines the joint obligations in a residential fixed-term tenancy. Given that inconsistency it is more appropriate the tenancy is considered as a periodic tenancy.
The tenant gave the landlord 48 days written notice that she was leaving. I understand a new tenant moved in within a week. I consider that notice period was more than required for tenant notice in a residential tenancy.
Having issued my initial determination by way of declaration on the issue of jurisdiction above, I now consider the tenant claims. Bond
The tenant has applied for refund of the bond, and exemplary damages for the landlord’s failure to lodge the bond appropriately.
The landlord has a possible claim against the bond but has not filed a counterclaim with Tenancy Services.
Section 22B(2) RTA 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.
Given no counterclaim exists the bond is returned to the tenant.
Section 19 RTA requires the landlord to lodge a bond within 23 working days. A failure to do so is declared an unlawful act.
The landlord did lodge the bond later, after pressure from Mr Hoey but this was well after the required 23 working days. There was clearly a technical breach of section 19 and this is an unlawful act.
As I have determined that the landlord committed an unlawful act 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
I consider it more than likely Ms Gong genuinely believed she did not have to lodge the bond, considering the arrangement to be outside of the RTA. I do not consider the failure was intentional and therefore no exemplary damages are ordered.
I stressed to Ms Gong that she needs to correct the situation with any of her other tenancies very quickly. Future failures may not be seen in the same light as now. Further information
The landlord asked about free advisory services for landlords. As mentioned in the hearing, she would do well to start at Tenancy Services (https://www.tenancy.govt.nz/).

Tenancy Tribunal case 4744271 — 14-day notice at 128 Grafton Road, Grafton, Auckland 1010

At a glance

Tenancy Tribunal case 4744271 — 14-day notice at 128 Grafton Road, Grafton, Auckland 1010

At a glance

Claims & awards

Order

Reasons

Topics & place

Residential Tenancies Act sections

Key findings

Frequently asked questions

Claims & awards

Order

Reasons

Topics & place

Residential Tenancies Act sections

Key findings

Frequently asked questions