Published tribunal order
Tenancy Tribunal case 4800839 — Tenancy dispute at 188 Jutland Road, Pukekohe, Pukekohe 2120
Decided 16 Sept 2024 · Published 16 Sept 2024 · Application 4800839
Landlord favoured
Order
- Pukekohe Management Ltd is to pay to the Bond Centre the sum of $3,040.00, being Kimberly Drake’s bond, by 5pm on Wednesday 2 October 2024.
- If Pukekohe Management Ltd does not pay the sum ordered at Order 1 to the Bond Centre by 5pm on Wednesday 2 October 2024 then Kimberly Drake may proceed to pay, direct to the Bond Centre, the amount that Pukekohe Management Ltd has failed to pay in breach of Order 1 in lieu of paying her rent. Such sums paid must be treated as a rent credit.
- Pukekohe Management Ltd is to pay Kimberley Drake the sum of $20.44 immediately, being reimbursement of the filing fee.
- The claim against Counties Realty Ltd trading as One Agency Counties Realty Rentals is dismissed.
Reasons
- The hearing was held by teleconference. Ms Drake (the tenant) attended the hearing. Mr Wang attended for Pukekohe Management Ltd (the owner/landlord of the property situated at 188 Jutland Road, Pukekohe 2120). The Tribunal was unable to contact Counties Realty Ltd trading as One Agency Counties Realty Rentals (the former property management company).
- Ms Drake is the tenant of the premises at 188 Jutland Road, Pukekohe 2120. She has applied to the Tribunal following concerns about her bond. Ms Drake says that the bond has never been lodged at the Bond Centre despite it being paid (section 19, Residential Tenancies Act 1986 (“RTA”)).
- The tenancy agreement records that the tenancy began on 21 August 2023 and was originally managed by property management company Counties Realty Ltd trading as One Agency Counties Realty Rentals as agent for the owner, Pukekohe Management Ltd. A ‘Trust Account Receipt’ on file records payment of the bond by Ms Drake of $3,040.00 received by Counties Realty Ltd on 14 August 2023.
- The tenancy is now being managed by a new property management company, Pukekohe Property Management Ltd trading as Quinovic Property Management. On 1 February 2024, Quinovic Property Management Ltd emailed a ‘Change of Landlord Agent Form’ to the Bond Centre and was advised it has “no past records or current records of having any records for this address”.
- I am satisfied that Ms Drake paid the bond of $3,040.00 to Counties Realty Ltd. However, I find the bond was not lodged by Counties Realty Ltd with the Bond Centre. Furthermore, Counties Realty Ltd went into liquidation on 7 February 2024.
- The key issue is who should be held liable?
- Ms Drake’s case: • She confirmed entering into a Tenancy Agreement with Pukekohe Management Ltd on 10 August 2023 for the specified tenancy address. In the Agreement, she notes Pukekohe Management Ltd is referred to as "the Owner," while Counties Realty Ltd is referred to as "the Landlord" acting "On behalf of" the owner. She also confirmed that she had paid the bond amount of $3,040.00 as stipulated in the Agreement. • She assumed the bond was lodged with the Bond Processing Centre, as outlined in clause 20 of the Agreement. She understood that Counties Realty Ltd was acting on behalf of the owner, which was evident when the owner changed agents to Pukekohe Property Management Ltd but her Tenancy Agreement and its terms remained unchanged. • She believes Pukekohe Management Ltd is in breach of the Agreement and the RTA for not lawfully lodging the bond. She argues that she should not lose the bond due to the actions of Counties Realty Ltd. Additionally, she is unsure about being listed as a creditor to Counties Realty Ltd, as she did not apply to be a creditor.
- Pukekohe Management Limited’s case: • As the landlord for 188 Jutland Road, Pukekohe 2120, Management Limited engaged Counties Realty Ltd (Ian Croft) for tenancy management. While collecting the bond was within Counties Realty Ltd’s authority, it is argued that Ian Croft’s actions of not lodging the bond with the Bond Centre were dishonest or negligent and outside their authority. Pukekohe Management Limited should not be held liable. Instead, an order should be made against Counties Realty Ltd (in liquidation) and Ian Croft personally. They will need to be joined to the proceedings. • The liquidator’s report indicates that by September 2023, the company could no longer afford to employ staff, suggesting the bond money was likely used for business expenses. • As the tenant has been listed as a creditor for the company, she should request the liquidator to join the Tenancy Tribunal, rather than pursuing Pukekohe Management Limited.
- The contractual relationship (as set out in the tenancy agreement) is between the tenant and the landlord. The tenancy agreement makes it clear that Counties Realty Ltd is the agent for the owner, Pukekohe Management Limited. Pukekohe Management Limited is therefore the principal. In such a relationship a claim may be bought by and against the principal. A principal is normally liable for all acts of an agent within the agent’s authority. Collecting a bond is part of a property manager’s usual activities.
- I am satisfied that Pukekohe Management Limited as landlord is the party ultimately responsible for the safe keeping of the bond and the lodging of the bond at the Bond Centre. If there is no reason to retain the bond at the end of the tenancy it is the landlord’s responsibility to return the bond. The landlord cannot rely on the fact the property management company has failed to lodge it and cannot rely on the fact that it does not have it.
- Therefore, I have ordered that Pukekohe Management Limited make good this deficiency. Pukekohe Management Limited must lodge $3,040.00, being the tenant’s bond, at the Bond Centre by 5pm on Wednesday 2 October 2024.
- Ms Drake’s application was also brought against Counties Realty Ltd. However, a claim against a company in liquidation must be stayed (this means it cannot proceed). In the circumstances I have no jurisdiction to hear this claim until either the liquidator consents or the High Court orders otherwise. The Tribunal has therefore proceeded in this matter with Pukekohe Management Limited being the landlord (rather than the property management company) as the correct party.
- It is open to Pukekohe Management Ltd to seek legal advice about potential legal avenues to pursue against Counties Realty Ltd or Ian Croft personally. Filing fee
- As Ms Drake has wholly succeeded with the claim, I must order the other party to reimburse the filing fee.