Published tribunal order
Tenancy Tribunal case 4772897 — Rent arrears at 100 Wilks Road, Dairy Flat, RD 4, Dairy Flat 0794
Decided 7 Jul 2024 · Published 7 Jul 2024 · Application 4772897
Dismissed
- Rent arrears
Order
- Victor James Isaac Smith and Chantelle Suzanne Dawn Allonby to pay Erning Zheng $3,556.86 immediately, calculated as shown in table below:
- The Bond Centre is to pay the bond of $5,000.00 (5386701-006) to Erning Zheng immediately.
- The tenants’ application is dismissed.
Reasons
- I heard these applications on 9 May 2024. Both parties attended the hearing. Ms Huang represented the landlord.
- I adjourned the hearing part heard for the tenants to provide further evidence and submissions on some of the landlord’s claims they were not aware of.
- I received the tenants’ additional submissions in terms of the timetable I set. The hearing concluded on 23 May 2023. Background
- The tenancy started on 22 March 2022 and ended on 4 December 2023.
- The tenancy premises comprised the main dwelling with 5 bedrooms, 2 lounges and a kitchen and a separate minor dwelling with 3 rooms comprising a bedroom, office, and bathroom facilities, described as a flat. The property overall was a small lifestyle block.
- Initially, one tenant moved into the flat in 2019. Then both tenants moved into the larger part of the premises, referred to as the house. They had flatmates who lived in the flat. The flatmates paid $400.00 per week which the tenants used to pay their rent of $1,250.00 per week.
- A dispute then arose between the parties with each filing an application for orders.
- I note the previous history of dispute on this tenancy. Each party made applications against the other. The Tribunal dismissed those applications in an order dated 5 April 2023 – see NZTT 4525030; 4540492.
- The applications before the Tribunal now are for end of tenancy issues. I note the earlier order simply to record the fractious nature of the relationship between the parties during the tenancy, and now, following the end of the tenancy. Issues
- The issues the Tribunal must determine are these: • Were the premises unlawful premises in part? • Did the premises comply with the HHS? • Have the tenants proved claims for compensation and/or exemplary damages? • Has the landlord proved a claim for rent arrears? • Has the landlord proved claims for compensation – mowing, site remediation, and skip hire? Relevant legal issues – compensation and exemplary damages
- The Tribunal may award compensation to a party for losses arising from a proven breach or breaches by the other party of their responsibilities under the Residential Tenancies Act 1986 (RTA). Compensation is generally awarded for actual losses and sometimes for less tangible effects of proven breaches such as a loss of enjoyment of the tenancy.
- In Birch v Otautahi Community Housing Trust [2020] NZDC 17667 the District Court confirmed that the Tribunal must consider the following factors when deciding to award compensation: • The nature of the breach; • The duration of the breach; and • The effect of the breach on the party.
- Exemplary damages are different. They are designed to punish and to deter. They are like a fine. In Auckland City Council v Blundell [1986] NZLR 732 the Court of Appeal (Cooke P) said: Exemplary and punitive [damages] are different words for the same thing. The damages are exemplary because they are meant to teach an example to the guilty officer and others. They are punitive because they are meant to punish. They are like a fine, though they go to the citizen who has been the victim of conduct.
- Exemplary damages are awarded at the Tribunal’s discretion when one party has proved that the other party has committed a defined unlawful act. If that is proven, and before the Tribunal may award exemplary damages, it must take account of the factors set out in section 109 RTA.
- In Birch (referred to above) 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. If the Tribunal considers that the person against whom the order is sought has committed the unlawful act intentionally, the Tribunal must then consider whether it would be just to require that person to pay exemplary damages, taking into account: (a) The intention of the person; (b) The effect of the unlawful act; (c) The interests of the party against whom the unlawful act was committed; and (d) The public interest. Relevant legal issues – tenant responsibilities at the end of a 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) RTA.
- 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.
- 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. The tenants’ application • Were the premises unlawful premises in part? • Did the premises comply with the HHS? • Have the tenants proved claims for compensation and/or exemplary damages?
- The tenants’ appear to have sought a full refund of rent of $94,289.00 as compensation for what they allege were landlord breaches. At the hearing, they referred to their claim as one for rent relief of $200.00 per week as compensation, an amount of $5,828.57.
- The tenants’ application is unrealistic.
- The tenants allege that the premises are unlawful residential premises because the area described as the flat was not consented for use as residential premises.
- Even it that were established, the circumstances when the Tribunal would order a full refund of rent are limited. Examples might include a situation where a landlord rented a shipping container with no facilities and no insulation or smoke alarms.
- Here, the premises generally were of a high standard.
- But the flaw in the tenants’ argument is this: the landlord did not rent the flat as separate residential premises, they did. They referred to the persons who resided in that area as their flatmates. There is nothing wrong with that arrangement. The landlord under this tenancy rented the tenants the entire premises.
- So, if the tenants consider that the part of the premises comprising the flat were not consented for residential use, and yet they rented that part of the premises, they would be considered a sub-landlord with potential liability should their tenants (the flatmates) bring a claim against them.
- The fact that the landlord rented the whole premises to the tenants negates any submission that part of the premises was not consented for use as separate residential premises. The landlord neither consented to, nor entered, a separate tenancy with the persons whom the tenants described as flatmates.
- The tenants’ application for any rent relief or compensation is based on a false premise and is dismissed.
- The tenants allege that the premises did not comply with the Healthy Homes Standards (HHS) in particular, the drainage standard.
- They said in evidence that when it rained water pooled up to 100mm especially around the front door and in a wider area in heavy rain. That caused access issues to the front door and, on occasion, to their parked vehicle.
- The tenants said they issued a breach notice following which some of the gutters were cleaned. That reduced the pooling of water, but the drainage issue generally was never addressed.
- Ms Huang said she engaged a contractor to fix the drainage issue after she received the breach notice. The drainlayer said there was no blockage but that extra water from a storage unit the tenants erected caused overload on the drainage system. The additional building did not have a properly connected stormwater system, nor was it consented.
- That water pools following heavy rain does not establish a breach of the HHS. With changing weather patterns, it is well recognised that flooding and the problems associated with it are now more prevalent.
- The landlord produced a HHS assessment report in evidence that shows the premises were HHS compliant. The tenants produced no evidence that the premises did not comply with the HHS.
- The tenants have not proved a claim for any breach of the HHS by the landlord. Their application for compensation and/or exemplary damages is dismissed. The landlord’s application • Has the landlord proved a claim for rent arrears? • Has the landlord proved claims for compensation – mowing, site remediation, and skip hire?
- The landlord has claimed rent arrears of $3,750.00. The tenants accepted this claim. I have made a rent arrears order by consent.
- The landlord has claimed compensation for costs incurred for mowing the lawns around the dwelling and mowing the paddocks ($2,024.00); back filling and remediating part of the site from where a cabin was removed ($2,369.00); and skip hire and rubbish removal ($393.42).
- The tenancy was for a rural property comprising about 4 hectares of land. The previous tenant kept horses on the land. The horses grazed the paddocks. The communications between these parties show that the tenants intended doing the same. The tenancy agreement allowed for horses to be kept. The tenancy agreement also required the tenants to keep the grass clear from areas such as the septic tank.
- Rural tenancies are often difficult because they involve the upkeep not only of the area around the house, but also, when the tenancy extends to grazing rights of land attached to the tenancy, of that land as well.
- The Tribunal’s enquiry is whether the tenants left the exterior of the premises, including in this case the paddocks that were included as part of the tenancy, reasonably tidy.
- Whether the tenants kept horses or not (they said the fences were not adequate to keep horses which the landlord denies) is irrelevant. They were still responsible to leave the exterior of the premises reasonably tidy.
- Having assessed the evidence both parties produced at the hearing, and after it, I find that the tenants did not leave the exterior of the premises reasonably tidy. In addition to the photographic evidence, the report provided by the contractor who did the work, and the earlier quotation for the work, prove the landlord’s claim on the balance of probabilities.
- I award the landlord the cost of the work - $2,024.00 (invoice produced).
- I also award the landlord the cost of remediating and back filling the part of the site where a cabin owned by a person known to the tenants (Dave) was erected.
- The photos produced in evidence establish the landlord’s claim that further land remediation work was required to restore the area of land that was excavated for the cabin to be erected to a reasonable condition. I award the landlord the cost of that work - $2,369.00 (invoice produced).
- I also find proved the landlord’s claim for the hire of a skip for rubbish removal. The tenants allege that the material removed was already at the premises and was not theirs. I find it more likely that the material removed was the result of the erection, and removal, of the cabin by Dave and the activities he carried out there described as a tree cutting business. The tenants are liable for that cost - $393.42 (invoice produced).
- The tenants in turn can claim the land remediation and rubbish removal costs from Dave in the Disputes Tribunal should he not agree to reimburse them. Result
- The tenants’ application is dismissed.
- The landlord has proved claims for rent arrears (accepted by the tenants); lawn mowing/weed eating/tractor mowing of land; land remediations costs; and skip hire/rubbish removal, a total of $8,536.42. To that is added the landlord’s Tribunal filing fee of $20.44.
- The bond will be paid to the landlord. The tenants must pay the landlord $3,556.86. Name suppression
- Upon my enquiry, neither party sought a name suppression order.