Published tribunal order
Tenancy Tribunal case 4853460 — Exemplary damages at 45 Brandon Road, Glen Eden, Auckland 0602
Decided 13 Oct 2024 · Published 13 Oct 2024 · Application 4853460
Tenant favoured
- Exemplary damages
- State of repair
- Healthy homes
Order
- Huihui Tapaea And William Wenchao Diwu For Btr Services Ltd and Wenchao Diwu must pay Tuna Latoa $19,245.73 immediately, calculated as set out in the table below:
Reasons
- The tenant attended the hearing. The landlords did not.
- I am satisfied that the landlords have received proper notice of the hearing time, date and place and chose not to attend.
- The tenant applied for reimbursement of overpayment of rent, refund of the bond, reimbursement of the filing fee, compensation and exemplary damages. Background
- The tenant had rented a room in a boarding house managed by the landlord in Mount Eden prior to moving into this premise. He had to leave there suddenly due to flooding and had been in emergency housing. He reached out to his rior landlord who placed him in this rental premise.
- The tenant produced three boarding house tenancy agreements he was required to sign by the landlord.
- The first tenancy agreement commences on 15 March 2023 and does not specify the period of the tenancy. The property manager is listed as HuiHui Tepaea. An email address and telephone number are provided in the tenancy agreement. Me Tepaea places an electronic signature on the agreement.
- The second and third tenancy agreements are each for three months.
- The second tenancy agreement starts on 3 May 2023 and ends on 3 August 2023. Under this agreement, the landlord required 4 weeks bond and 12 weeks rent in advance. The tenant says WINZ reused to pay 12 weeks rent in advance, so a new tenancy agreement was provided to him. No property manager details are provided in this tenancy agreement. Mr Huihui Tepaea and Mr Benji Oti are named in the tenancy agreement and then their names are crossed out by hand in blue ink. The only contact detail in the agreement is office@btrservice.co.nz but Mr Beji Otis signs it.
- The third tenancy agreement starts on 4 May 2023 and ends on 4 August 2023. Mr Diwu is listed as the property manager on the front page of the agreement, Mr Diwu signs the agreement, but the contact details at the end of the agreement are for Mr Huihiui Tepaea and Mr Benji Black. Willow Black is listed as the Administration person for BTR Services Ltd.
- I made an Order under application 4745170 on 25 January 2024 terminating Wenchao Diwu’s tenancy at 45 Brandon Road, Glen Eden, Auckland on Thursday 25 January 2024 at 11:59pm. Mr Diwu’s tenancy was terminated because he was $11,622.86 in rent arrears and $1,780.28 in water rates arrears on 29 January 2024 when the landlord executed an eviction warrant.
- The tenancy agreement Mr Diwu signed shows that he was not allowed to sublet the premise without written consent from the landlord, which he never requested or received.
- The Tribunal’s database shows that this is the fourth tenancy Mr Diwu rented and sublet unlawfully in the period March 2023 to January 2024, and was subsequently evicted from.
- The tenant produced an eviction order from the Tribunal also evicting Mr Diwu from the premise that is listed as the registered office for his business, Btr Services Ltd, being 4024 Great North Road, Glen Eden. Mr Diwu is recorded as the only director of Btr Services Ltd on the Companies Office register and has 100 percent shareholding in it.
- The tenant found a statement of demand in relation to another eviction order and rent arrears issued by the Tribunal attached to the fence of 4024 Great North Road, Glen Eden when he started searching for Mr Diwu to try to get him to address the significant and serious maintenance issues he had with the Brandon Road premise. This statement of demand says that BTR Services Ltd owes Mr Robert Stevens $820.44 from a Tribunal Order dated 17 August 2023.
- The pattern the tenant has proven with the evidence submitted with his claim is that Mr Diwu sublets premises he rents under his own name to vulnerable members of our community. These vulnerable members are all Work and Income New Zealand (WINZ) customers that are departee to find a place to live that they can afford, and they don’t raise many issues with him as a landlord as they are grateful for a place to live. He makes sure WINZ pays him the rent in advance and bond and automatically pays the rent to Mr Diwu each week before the tenants receive the remainder of their benefit.
- Mr Diwu then collects rent and water rates payments from his sub-tenants and does not pay these to his landlord. He pockets the money and leaves the sub- tenants in the premises, without undertaking any repairs and maintenance until his landlord gets an eviction order and then evicts his subtenants. Mr Diwu then makes himself unable to be found or contacted and the tenants do not receive their bond back or nay rent they paid in advance. Failure to lodge and receipt the bond
- Tuna Latoa claims the landlord has not lodged the bond with the Bond Centre within the required time.
- A landlord must send any bond payment to the Bond Centre within 23 working days after the payment is received. See section 19(1) Residential Tenancies Act 1986.
- Breaching this obligation is an unlawful act for which the Tribunal may award exemplary damages up to a maximum of $1,500.00. See section 19(2) and Schedule 1A Residential Tenancies Act 1986.
- The tenant proved that WINZ advanced Mr Diwu a $1,528.00 bond that the tenant is still paying back to WINZ at $15.00 per week and $764.00 rent in advance that the tenant is still paying back at $7.50 per week. Further, the tenant has proven that he has contacted the Bond Centre, and it confirmed the landlord never lodged his bond with the Bond Centre.
- I find they have committed an unlawful act.
- 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) Residential Tenancies Act 1986.
- Landlords are required to understand their responsibilities to tenants. I am satisfied the landlord should have reasonably known that the bond had to be submitted to the Bond Centre within 23 days after her receipt of it.
- The landlord could have sought advice from the Tenancy Services website and/or the Call Centre. The website contains bond forms and other such resources that the landlord could have used to inform her of what to do with the bond.
- The obligations placed on a landlord to put the bond into the Bond centre on trust for the tenant is an obligation the Tribunal takes seriously. The bond is owned by the tenant, until the parties agree that all or part of the bond can be paid to the landlords to cover proven debts.
- I find it would be just to require the landlord to pay a sum of $1,500.00 in exemplary damages because: a. The landlord intentionally did not lodge the tenant’s bond with the Bond Centre within 23 working days after 23 April 2024 and still had not lodged the bond with the Bond Centre as at the date of the hearing; b. The tenant is entitled to rely on the Bond Centre protecting his bond money that should have been placed in it on trust for the tenant’s benefit, unless it is proven the tenant owes the landlord a debt that both parties agree can be paid by the Bond Centre to the landlord or on order from the Tribunal. The tenants’ money was never protected by the Bond Centre (a third independent party) for the duration of the tenancy from 4 May 2023 to 1 February 2024, and it should have been. The landlord retained the bond without the tenants’ knowledge of who held their bond. The tenant called the Bond Centre to find out how to have the bond released at the end of his tenancy and that was the first he knew that the bond had never been lodged; c. It is in the interests of the tenant to receive exemplary damages for the landlord’s breach of its obligations to lodge the bond with the Bond Centre; and d. it is in the public interest for landlord to be penalised as a disincentive to breaching its obligations pay the bond received into the Bond Centre promptly for the protection of both parties’ interests.
- I also find that the landlord is required to refund the bond to the tenant that he has unlawfully retained. Unlawful notice
- The tenant claims that the landlord has breached its obligations under section 60AA of the RTA.
- Under Section 60AA a landlord must not give a notice to terminate the tenancy or apply to the Tribunal for such an order, knowing they are not entitled to do so.
- Breaching any of these obligations without a reasonable excuse 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 Residential Tenancies Act 1986.
- On 1 December 2023, the landlord sent members of the Comancheros gang to tell the tenant to leave the house in three days, as he had withheld his rent until the repair and maintenance issues were addressed.
- On 8 December the landlord and one of the gang members returned to the premise to try and collect the rent from the tenant again.
- At no time did the landlord inform the tenant that he was about to be evicted because the landlord had not paid the rent on this premise to the owner of the property and the owner had started the process to evict the tenant’s landlord.
- Wenchao Diwu’s tenancy at 45 Brandon Road, Glen Eden, Auckland was terminated on Thursday 25 January 2024 at 11:59pm by the Tribunal.
- The tenant was subject to a bailiff turning up to his home on 29 January 2024 issuing an eviction warrant to Mr Diwu and informing him and the others subletting the premise that they had to leave the premise by 1 February 2024. It when the bailiff came to evict him that he became aware that Mr Diwu did not own the premise, that Mr Diwu was being evicted because the owner of the premise thought he Mr Diwu lived there and Mr Diwu had not paid his rent for quite some time. The tenant had been given no warning he was about to be evicted because of what Mr Diwu had done and was shocked to be told he had no legal right to live in the premise and had two days to find somewhere ese to live.
- I find the landlord has committed an unlawful act.
- 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) Residential Tenancies Act 1986.
- I find it would be just to require the landlord to pay a sum of $6,500.00 in exemplary damages because: a. The landlord intentionally took rent from the tenant under an unconsented sublet arrangement he did not inform the tenant of. He failed to pay the rent to the owner of the property and then did not inform the tenant that he was about to have his tenancy brought to and end by a bailiff issuing an eviction warrant requiring him to move out in two days, with no prior warning. The landlord knew from when the owner filed its application for termination of the tenancy that this was the likely outcome but still failed to notify the tenant of the situation; b. The tenant is entitled to rely on being given lawful notice terminating his tenancy. The landlord had far more than 28 days between when the owner lodged its application for termination of the tenancy and when the landlord was evited by the owner. He chose not to inform the tenant and to let him find out when the bailiff arrived to evict the landlord. It is in the interests of the tenant to receive exemplary damages for the landlord’s breach of its obligations to give the tenant lawful notice; and c. it is in the public interest for landlord to be penalised as a disincentive to breaching its obligations to give the tenant lawful notice. Failure to maintain the premise
- The tenants says the landlord failed to provide and maintain the premises in a reasonable state of repair having regard to the age and character of the premises and the period during which the premises are likely to remain habitable and available for residential purposes.
- Under section 45(1)(b) of the RTA, the landlord has an obligation to investigate and repair a defect brought to its attention, within a timeframe that is reasonable in the circumstances. In Collins v Professionals Hutt City Ltd, the Wellington District Court held “what that time is depends not only on the gravity of the problem but also on the objective evidence of the attempts made by the landlord to investigate, and put right, whatever the problem might be”. 1
- There is an obligation to repair, even if the tenant has notice of the state of repair of the premises when entering a tenancy agreement.
- A tenant may give a landlord 14 days’ notice to remedy a breach of the RTA and/or any relevant enactment in relation to buildings, health and safety, but should do so in good faith and to remedy a real and significant breach 2 . However, notice from the tenant is not required if the landlord knew of the need to repair 3 or the need for repair was apparent from observation 4 . 1 Collins v Professionals Hutt City Ltd DC Wellington CIV-2009-085-1431, 24 February 2019 at [15]. 2 Brough v Housing NZ Ltd NZTT1848/1, 27 May 202 at [13]. 3 Berghan v Ponsonby Property Management Ltd trading as L J Hooker [2015] NZTT Manukau 2845 at [9]- [11]. 4 Barfoot & Thompson Ltd v Casey DC Auckland CIV-2005-004-1762, 7 November 2007 at [4].
- There is also failure to repair if the repair is ineffective, non-complaint or unsafe 5 .
- Breaching this s45(1)(b) obligations is an unlawful act for which exemplary damages may be awarded up to a maximum of $7,200.00. See section 45(1A) and Schedule 1A Residential Tenancies Act 1986.
- General damages may also be awarded in the form or rent reductions, water rates reductions or compensation for the stress, inconvenience and loss of amenity suffered by the tenants.
- The tenant gave evidence that the tenancy agreement stated that the landlord was responsible for the lawns and yard maintenance, but he never did the lawns or tidied the yard. When the tenant tried to contact the landlord about this issue he was never able to be reached.
- The tenant also gave evidence that: a. The house was infested with cockroaches; b. There was no washing machine, which was supposed to be a chattel provided to him; c. There was no bed provided to him, when that was also a chattel that was supposed to be provided to him. He had a borrow a stained bed from another tenant while he tried to locate the landlord to get him a more clean and hygienic bed; d. There was a smashed window that needed repair; e. There were gaps around the windows that let cold air into the premise; f. The back door lock was smashed and required repair or replacement as the premise could not be secured; g. The tenant had no key to the garage, but that was an amenity he was paying to share with the other tenants. In addition, the last tenant had left her belongings in the garage that the tenant wanted moved so he so he could use the space; and h. The internet that the landlord was supposed to provide went down in June 2023 and was never reconnected.
- The tenant produced evidence that showed the tenant sent the landlord an email on 13 September 2023, outlining all the issues he was having with the property and requesting the landlord investigate and remedy these promptly.
- Thereafter the tenant proved he followed this email of issues up regularly by email and phone but was never successful at reaching the landlord. The landlord never responded to any of his communications. 5 Staife v Aegis Trust [2016] NZTT Auckland 3314 at [31].
- As the condition of the property deteriorated further, the tenant to steps to try to find out who the owner of the property was. He went to the registered address of the landlord company and found the statement of demand on the fence of the property showing that BTR Services Ltd and Mr Diwu owed money to the owner of that premise, had been evicted and was being chased by the judgment creditor for what was owed.
- The tenant produced emails dated 28 August 2023, 24 October 2023 and 20 November 2023 asking for the growing number of repair and maintenance issues to be resolved. He also says he withheld rent in an attempt to get the landlord to contact him. The email dated 13 September 2023 lists a number is repair and maintenance issues that require urgent attention. The tenant says he also tried to call all the numbers provided in his tenancy agreements and all the email addresses and he never got a response.
- The first time Mr Diwu called him was just after the tenant’s 20 November email. Mr Diwu promised to address the issues the tenant had raised but did nothing. The tenant says he expressed his frustration to Mr Diwu at having tried unsuccessfully to contact him for 4 months and never getting a response as well as being without internet from June 2023.
- On 1 December 2023, the tenant says two Polynesian men, one was called Benji turned up unannounced to the premise. The tenant had never seen these men before and they did not say who they were. The tenant says the men through the house knocking on everyone’s doors and telling them they had to leave in 3 days as they had not paid their rent. The tenant asked for their identification and was not given any, but the men tried to intimidate him. One of the other tenants told the tenant that these men were from the Comanchero gang.
- On 8 December 2023, the tenant says Mr Diwu, and the man Mr Diwu called Benji, came to the premise and told everyone they had to pay their rent. The tenant objected and asked Mr Diwu to undertake the maintenance work required and then he would pay his rent. The tenant says he filmed Mr Diwu and Benji intimidating the tenants and Benji assaulted him.
- On 9 December 2023, the tenant issued the landlord with a 14 day notice to remedy all the issues he had raised in his 13 September 2023 email, in their 20 November 2023, 1 December 2023 and 8 December 2023 discussions.
- After receiving the 14 day notice on 9 December 2023, instead of remedying the issues raised, Mr Diwu sent the same Polynesian men around to intimidate the tenant to stop him raising any further issues.
- Where a party has committed an unlawful act intentionally, the Tribunal may award exemplary damages if 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) Residential Tenancies Act 1986.
- I am satisfied it would be just to require the landlord to pay a sum of $4,800.00 in exemplary damages (two third’s of the total penalty available), and make the order accordingly because: a. The tenant had been living in an undesirable living environment for a significant portion of the tenancy. The landlord knew the house was unable to be secured, the internet was not working, the house was damp and cold from a broken window and gaps around windows and doors and the landlord refused to remedy this; b. The tenant suffered the loss of amenity, stress and inconvenience associated the landlord failing to meeting its s45(1)(b) of the RTA obligations and sending gang members to intimidate him and other tenants when they tried to exercise their right to have the premise maintained in a reasonable condition; c. It is in the interests of the tenant to receive exemplary damages for the stress, inconvenience and loss of amenity he suffered for the 8 months he continually tried to follow the landlord up and requesting that he remedy the repair and maintenance issues, without any success from one month after the tenancy commenced; d. It is in the public interest for landlord’s to be penalised as a disincentive to breaching their repair and maintenance obligations.
- The tenant says he had stopped paying rent for 4 to 5 months before his tenancy was brought to an abrupt end. Consequently, I have not awarded the tenant a rent rebate for the loss of amenity he suffered because of the landlord’s breach of s45(1)(b) of the RTA. Had the tenant paid rent for this period, I would have awarded him a rent rebate. Failure to provide a copy of the insurance policy
- Tuna Latoa claims the landlord has not provided a copy of the insurance policy for the premises and the excess on the policy for any damage claims. It is required to include this information in the tenancy agreement.
- Section 13A(2) of the RTA states “the landlord must include in the tenancy agreement the following information about insurance of the premises: a. If the premises are not insured, a statement that they are not insured; and b. If the premises are insured, a statement: i. setting out, for each insurance policy that is relevant to the tenant’s liability for destruction of or damage to the premises, the amount of each excess that is relevant (if any) to that liability; and ii. informing the tenant that a copy of the policy is available to the tenant on request (except that the statement need not inform the tenant of this if the landlord has already provided to the tenant a copy of the policy in accordance with section 45(2B) or66J(5))”.
- Breaching this obligation is an unlawful act for which the Tribunal may award exemplary damages up to a maximum of $750.00. See section 13A(1F)(a) and Schedule 1A RTA.
- I am satisfied the landlord failed to provide the tenant with the required insurance information, prescribed by sections 13A(2) and 13A(1F)(a) of the RTA, but that she did so as she was not fully aware of her legislative obligation to do so. Ignore of the law is no excuse when it comes to compliance with the RTA, but I cannot conclude that the breach was intentional.
- The breach was a technical breach that the evidence shows: a. Had a negligible if any effect on the tenant, as the property is insured, had the tenant requested the insurance information it would have been provided; b. There were no claims made by the tenant that suggested the premises were not insured or that any issues occurred where the landlord had to rely on her insurance; c. It is not in the public interest for the Tribunal’s time to be taken up on technical breaches that have no effect.
- As such, while the evidence proves a minor technical breach has occurred, I do not find it just to award the tenant exemplary damages for the breach.
- Landlords are however required to understand their responsibilities to tenants, and I acknowledge this by awarding a compensatory sum of $300.00 as it is in the public interest for the Tribunal to dissuade landlords from failing to educate themselves on their responsibilities to their tenants under the RTA. Failure to provide healthy homes information
- Tuna Latoa claims the landlord has not provided him with any healthy homes information for the premises in the tenancy agreement.
- The tenant claims that the landlord has breached her obligations under section 13A(1CA) of the Residential Tenancies Act 1986.
- Under section 13A(1CA), a landlord must include in the tenancy agreement a statement, made and signed by the landlord, that, on and after the commencement of the tenancy, the landlord will comply with the healthy homes standards as required by section 45(1)(bb) or 66I(1)(bb) (as the case may be); and including the information (if any) prescribed by regulations under section 138B(5). The Residential Tenancies (Healthy Homes Standards) Regulations 2019 require that the landlord provides a statement in each tenancy agreement that confirms that the premises complies with each of the healthy homes standards or why the premises are subject to any lawful exemptions.
- The requirement that the landlord’s statements under 13A(1CA) be signed by the landlord is in addition to the requirement under section 13(1) that the landlord sign the tenancy agreement.
- Breaching the landlord’s s13A(1CA) obligations without a reasonable excuse is an unlawful act for which exemplary damages may be awarded up to a maximum of $750.00. See section 13A(11F)(a) and Schedule 1A Residential Tenancies Act 1986.
- The landlord did not provide the tenant with health homes information in any of the three fixed term tenancy agreements it issued to the tenant. It was legally required to include a healthy homes compliance statement and more detailed healthy homes statements for all five of the healthy homes standards, being insulation, ventilation, moisture ingress and drainage, draught stopping and heating and it also was required to provide smoke alarm numbers, where they are located, when they were last tested and date they are due for replacement.
- I find the landlord has committed an unlawful act.
- 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) Residential Tenancies Act 1986.
- I am satisfied the landlord intentionally failed to provide the tenant with the required completed and signed healthy homes statements, prescribed by sections 13A(1CA) and 45(1)(bb) of the RTA, and it would be it would be just to require the landlord to pay a sum in the nature of $750.00 of exemplary damages (the maximum penalty available), because: a. The landlord would have reasonably known it had to comply with the Residential Tenancies (Healthy Homes Standards) Regulations 2019 and intentionally did not. It was an experienced tenant and subletter and was well aware of this legal requirement; b. The impact on the tenant of the landlord not providing this information is that he took on the tenancy for a premise that did not meet any of the HHS and that health issues because of the draughts, dampness and mould in the house. The tenant may not have taken the tenancy if he had known the premise did not comply with any of the healthy homes’ standards, but was denied that opportunity; c. It is in the interests of the tenant to be compensated for the landlord’s failure to provide signed proof to the tenant that the rental premises meet all of the healthy homes standards; d. It is in the public interest to penalise landlord’s that intentionally breach the law and fail to provide signed healthy homes standards statements that meet the requirements set out in the Residential Tenancies Act 1986 and the Residential Tenancies (Healthy Homes Standards) Regulations 2019. Reimbursement of filing fee
- Because Tuna Latoa has substantially succeeded with the claim I have reimbursed the filing fee.