What was the outcome of Tenancy Tribunal case 5135488?

The tribunal order states: The landlord counter claim is dismissed.

How much money was awarded in case 5135488?

Property Damage: $400.00 awarded to tenant; Filing Fee: $27.00 awarded to tenant; Refund Of Option Fee: $480.00 awarded to tenant

What type of tenancy dispute was case 5135488?

The primary dispute was Exemplary damages.

Where can I read the official tribunal order for case 5135488?

The official Ministry of Justice published order is available at https://forms.justice.govt.nz/search/Documents/TTV2/PDF/11570694-Tenancy_Tribunal_Order.pdf.

What was the outcome of Tenancy Tribunal case 5135488?

The tribunal order states: The landlord counter claim is dismissed.

How much money was awarded in case 5135488?

Property Damage: $400.00 awarded to tenant; Filing Fee: $27.00 awarded to tenant; Refund Of Option Fee: $480.00 awarded to tenant

What type of tenancy dispute was case 5135488?

The primary dispute was Exemplary damages.

Where can I read the official tribunal order for case 5135488?

The official Ministry of Justice published order is available at https://forms.justice.govt.nz/search/Documents/TTV2/PDF/11570694-Tenancy_Tribunal_Order.pdf.

8 Apirana Avenue, Glen Innes, Auckland 1072 Tenancy Tribunal Case 5135488 — Exemplary damages

Claims and awards in Tenancy Tribunal application 5135488 — net $907.00 NZD. Amounts reconciled from the published order (claims sum and net total). Verify on MoJ.
Claim	Tenant	Reason
Refund of option fee	$480.00	Refund of option fee
Exemplary damages	$400.00	Exemplary damages
Filing fee reimbursement	$27.00	Filing fee reimbursement
Net award	$907.00
Total payable by Landlord to Tenant	$907.00

Order

The landlord counter claim is dismissed.
Claudia Yun must pay Christopher Miller $907.00 immediately. DescriptionTenant Refund of option fee $480.00 Exemplary damages $400.00 Filing fee reimbursement $27.00 Total award $907.00 Total payable by Landlord to Tenant $907.00

Reasons

Both parties attended the hearing which took place by teleconference on 13 March 2025 with assistance from an interpreter.
The applicant Mr Miller claims that Ms Yun has requested ‘key money’ and refused to return $480.00 that he paid to secure the option of renting the premises. Mr Miller seeks refund of the $480.00 and compensation and /or exemplary damages.
The respondent, Ms Yun, has cross applied for compensation of $480.00 for holding the flat and stopping the advertising.
Both parties provided copies of messaging that took place between them in late December 2024 and January, February 2025 and gave verbal evidence at the hearing.
Mr Miller responded to an advertisement on Facebook marketplace in late December 2024. He stated that the advertisement was for a self-contained flat. Ms Yun claimed that the premises were a flat sharing arrangement for a granny flat which was part of a larger home. Neither party provided a copy of the advertisement.
Mr Miller tenant paid Ms Yun the sum of $480.00 and Ms Yun stopped advertising the premises.
The parties entered into communication regarding the terms of the agreement and when it would commence. There was no agreement between the parties as to the terms of the tenancy. This was evident from the messages between the parties and the evidence given at the hearing. No agreement was signed by both parties.

Does the Tribunal have jurisdiction to hear this claim?

The Tribunal has jurisdiction to hear disputes between landlords and tenants in relation to a residential dispute that comes within the Residential Tenancies Act 1986 (“RTA”).
The definition of landlord includes a prospective landlord, and the definition of tenancy includes prospective tenant according to s. 2 (1) of the RTA.
Although the parties in this case had not entered into a tenancy agreement and had not agreed on terms, I am satisfied that they were in negotiation and were prospective landlord and tenant at the time that the $480.00 was paid to the landlord by the tenant. Therefore, the Tribunal has jurisdiction to hear this claim.

Did the prospective landlord require key money?

A landlord cannot, without the Tribunal’s consent, require a tenant to pay any money other than rent or bond for the grant, renewal, variation or assignment of a tenancy agreement. See section 17(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 17(3) and Schedule 1A Residential Tenancies Act 1986.
Although in some communication the parties’ referred to the $480.00 as a bond payment the definition of a bond according to the RTA is “any sum of money payable or paid under a tenancy agreement as security for the observance and performance of the tenant’s obligations under the agreement and this Act” see section 2 (1) RTA. As there was no tenancy agreement entered into this amount was not paid under a tenancy agreement as either rent or bond.
I find that the $480.00 paid by the tenant to the landlord was for an option to hold the premises while the parties entered into discussion regarding the terms of the agreement.
The landlord’s initial requirement for the tenant to pay a week’s rent as an option for the tenant to enter into the tenancy agreement is not unlawful. Any sum required or received for an option to enter into a tenancy agreement if the sum does not exceed 1 week’s rent payable under the agreement, and, upon the option being exercised, the sum is refunded or is applied toward the rent. See section 17(4) RTA.
Therefore, Ms Yun’s requirement and Mr Miller’s payment of $480.00 to secure the option to enter into a tenancy agreement with the landlord is not on the face of it unlawful.
However, upon Mr Miller communicating that he will not be proceeding with the tenancy, that sum must be refunded as recorded in section 17(4)(a) RTA.
Mr Miller was intending to move cities if this tenancy commenced. On 15 January 2025 Mr Miller advised that his intended move was delayed for personal reasons and road closures. The subsequent messaging records a breakdown in negotiations between the parties. The tenant had not signed a tenancy agreement. The parties were still in negotiation as to the terms of the tenancy. Mr Miller was within his rights to exercise his option not to proceed and have his initial deposit refunded unconditionally.
Ms Yun refused to refund the sum of $480.00 to Mr Miller and claims it towards the cost of stopping advertising while discussions regarding the granting of the tenancy were taking place. This amounts to requiring key money which is an unlawful act. Counterclaim
When Mr Miller sought a refund of the $480.00 on or about 16 January 2025, Ms Yun disputed this and claimed the money due to cancelled advertising, time spent and lost opportunities to relet the premises. Ms Yun states that there was an effect on her as a result of the time taken before Mr Miller exercised his option not to proceed.
I find that the landlord’s counterclaim is not proved because the parties did not reach any concluded nor binding tenancy agreement.

Is Ms Yun liable for compensation?

Mr Miller seeks compensation for the cost of selling furniture in anticipation of the move and paying a bond for another premises of over $1300. No corroborating proof of the amounts claimed was provided to the Tribunal. As the Tribunal has found that the parties had not entered into a binding agreement Mr Miller was entitled to exercise his option not to proceed with the tenancy. This was a choice that he was entitled to make but the prospective landlord is not liable for the consequence of this option being exercised. In either event there would have been a cost to the tenant in the form of a bond and moving costs. Therefore, no compensation will be ordered.

Is Ms Yun liable to pay exemplary damages?

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 (s 109(3) RTA).
Mr Miller requested refund of the $480.00 on 16 January 2025 and Ms Yun refused to return it. I find that the refusal to refund the $480.00 when requested was intentional.
Mr Miller seeks exemplary damages and asks the Tribunal to consider that he sold furniture in anticipation of the move, had to pay a bond for another premises of over $1300 and suffered the financial inconvenience and stress of the landlord failing to return his option fee.
Although Mr Miller the tenant claimed that Ms Yun has done this previously there was no proof provided of this or of previous awards of exemplary damages, therefore the Tribunal must consider this as a first breach.
It is in the public interest that landlords and prospective landlords are careful to comply with the requirements of the RTA in respect of key money and option fees to ensure they are not holding on to money paid as options for prospective tenancies that do not proceed.
Considering all of the above factors, exemplary damages on the lower end of the scale is appropriate. I order payment of $400.00 in exemplary damages for the landlord’s unlawful act under section 17 RTA. Filing fee/suppression
Because the Mr Miller has substantially succeeded with the claim I have reimbursed the filing fee.
Ms Yun applied for suppression of identifying details in any publication of this order in her cross application. If a party has wholly or substantially succeeded in the proceedings the Tribunal must make the order unless the Tribunal considers that publication is in the public interest or is justified because of the party’s conduct or any other circumstances of the case. Section 95A Residential Tenancies Act 1986. As Ms Yun has not been successful with her cross application no order for suppression is made.

Claims and awards in Tenancy Tribunal application 5135488 — net $907.00 NZD. Amounts reconciled from the published order (claims sum and net total). Verify on MoJ.
Claim	Tenant	Reason
Refund of option fee	$480.00	Refund of option fee
Exemplary damages	$400.00	Exemplary damages
Filing fee reimbursement	$27.00	Filing fee reimbursement
Net award	$907.00
Total payable by Landlord to Tenant	$907.00

Order

The landlord counter claim is dismissed.
Claudia Yun must pay Christopher Miller $907.00 immediately. DescriptionTenant Refund of option fee $480.00 Exemplary damages $400.00 Filing fee reimbursement $27.00 Total award $907.00 Total payable by Landlord to Tenant $907.00

Reasons

Both parties attended the hearing which took place by teleconference on 13 March 2025 with assistance from an interpreter.
The applicant Mr Miller claims that Ms Yun has requested ‘key money’ and refused to return $480.00 that he paid to secure the option of renting the premises. Mr Miller seeks refund of the $480.00 and compensation and /or exemplary damages.
The respondent, Ms Yun, has cross applied for compensation of $480.00 for holding the flat and stopping the advertising.
Both parties provided copies of messaging that took place between them in late December 2024 and January, February 2025 and gave verbal evidence at the hearing.
Mr Miller responded to an advertisement on Facebook marketplace in late December 2024. He stated that the advertisement was for a self-contained flat. Ms Yun claimed that the premises were a flat sharing arrangement for a granny flat which was part of a larger home. Neither party provided a copy of the advertisement.
Mr Miller tenant paid Ms Yun the sum of $480.00 and Ms Yun stopped advertising the premises.
The parties entered into communication regarding the terms of the agreement and when it would commence. There was no agreement between the parties as to the terms of the tenancy. This was evident from the messages between the parties and the evidence given at the hearing. No agreement was signed by both parties.

Does the Tribunal have jurisdiction to hear this claim?

The Tribunal has jurisdiction to hear disputes between landlords and tenants in relation to a residential dispute that comes within the Residential Tenancies Act 1986 (“RTA”).
The definition of landlord includes a prospective landlord, and the definition of tenancy includes prospective tenant according to s. 2 (1) of the RTA.
Although the parties in this case had not entered into a tenancy agreement and had not agreed on terms, I am satisfied that they were in negotiation and were prospective landlord and tenant at the time that the $480.00 was paid to the landlord by the tenant. Therefore, the Tribunal has jurisdiction to hear this claim.

Did the prospective landlord require key money?

A landlord cannot, without the Tribunal’s consent, require a tenant to pay any money other than rent or bond for the grant, renewal, variation or assignment of a tenancy agreement. See section 17(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 17(3) and Schedule 1A Residential Tenancies Act 1986.
Although in some communication the parties’ referred to the $480.00 as a bond payment the definition of a bond according to the RTA is “any sum of money payable or paid under a tenancy agreement as security for the observance and performance of the tenant’s obligations under the agreement and this Act” see section 2 (1) RTA. As there was no tenancy agreement entered into this amount was not paid under a tenancy agreement as either rent or bond.
I find that the $480.00 paid by the tenant to the landlord was for an option to hold the premises while the parties entered into discussion regarding the terms of the agreement.
The landlord’s initial requirement for the tenant to pay a week’s rent as an option for the tenant to enter into the tenancy agreement is not unlawful. Any sum required or received for an option to enter into a tenancy agreement if the sum does not exceed 1 week’s rent payable under the agreement, and, upon the option being exercised, the sum is refunded or is applied toward the rent. See section 17(4) RTA.
Therefore, Ms Yun’s requirement and Mr Miller’s payment of $480.00 to secure the option to enter into a tenancy agreement with the landlord is not on the face of it unlawful.
However, upon Mr Miller communicating that he will not be proceeding with the tenancy, that sum must be refunded as recorded in section 17(4)(a) RTA.
Mr Miller was intending to move cities if this tenancy commenced. On 15 January 2025 Mr Miller advised that his intended move was delayed for personal reasons and road closures. The subsequent messaging records a breakdown in negotiations between the parties. The tenant had not signed a tenancy agreement. The parties were still in negotiation as to the terms of the tenancy. Mr Miller was within his rights to exercise his option not to proceed and have his initial deposit refunded unconditionally.
Ms Yun refused to refund the sum of $480.00 to Mr Miller and claims it towards the cost of stopping advertising while discussions regarding the granting of the tenancy were taking place. This amounts to requiring key money which is an unlawful act. Counterclaim
When Mr Miller sought a refund of the $480.00 on or about 16 January 2025, Ms Yun disputed this and claimed the money due to cancelled advertising, time spent and lost opportunities to relet the premises. Ms Yun states that there was an effect on her as a result of the time taken before Mr Miller exercised his option not to proceed.
I find that the landlord’s counterclaim is not proved because the parties did not reach any concluded nor binding tenancy agreement.

Is Ms Yun liable for compensation?

Mr Miller seeks compensation for the cost of selling furniture in anticipation of the move and paying a bond for another premises of over $1300. No corroborating proof of the amounts claimed was provided to the Tribunal. As the Tribunal has found that the parties had not entered into a binding agreement Mr Miller was entitled to exercise his option not to proceed with the tenancy. This was a choice that he was entitled to make but the prospective landlord is not liable for the consequence of this option being exercised. In either event there would have been a cost to the tenant in the form of a bond and moving costs. Therefore, no compensation will be ordered.

Is Ms Yun liable to pay exemplary damages?

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 (s 109(3) RTA).
Mr Miller requested refund of the $480.00 on 16 January 2025 and Ms Yun refused to return it. I find that the refusal to refund the $480.00 when requested was intentional.
Mr Miller seeks exemplary damages and asks the Tribunal to consider that he sold furniture in anticipation of the move, had to pay a bond for another premises of over $1300 and suffered the financial inconvenience and stress of the landlord failing to return his option fee.
Although Mr Miller the tenant claimed that Ms Yun has done this previously there was no proof provided of this or of previous awards of exemplary damages, therefore the Tribunal must consider this as a first breach.
It is in the public interest that landlords and prospective landlords are careful to comply with the requirements of the RTA in respect of key money and option fees to ensure they are not holding on to money paid as options for prospective tenancies that do not proceed.
Considering all of the above factors, exemplary damages on the lower end of the scale is appropriate. I order payment of $400.00 in exemplary damages for the landlord’s unlawful act under section 17 RTA. Filing fee/suppression
Because the Mr Miller has substantially succeeded with the claim I have reimbursed the filing fee.
Ms Yun applied for suppression of identifying details in any publication of this order in her cross application. If a party has wholly or substantially succeeded in the proceedings the Tribunal must make the order unless the Tribunal considers that publication is in the public interest or is justified because of the party’s conduct or any other circumstances of the case. Section 95A Residential Tenancies Act 1986. As Ms Yun has not been successful with her cross application no order for suppression is made.

Tenancy Tribunal case 5135488 — Exemplary damages at 8 Apirana Avenue, Glen Innes, Auckland 1072

At a glance

Tenancy Tribunal case 5135488 — Exemplary damages at 8 Apirana Avenue, Glen Innes, Auckland 1072

At a glance

Award balance

Claims & awards

Order

Reasons

Does the Tribunal have jurisdiction to hear this claim?

Did the prospective landlord require key money?

Is Ms Yun liable for compensation?

Is Ms Yun liable to pay exemplary damages?

Topics & place

Residential Tenancies Act sections

Key findings

Frequently asked questions

Award balance

Claims & awards

Order

Reasons

Does the Tribunal have jurisdiction to hear this claim?

Did the prospective landlord require key money?

Is Ms Yun liable for compensation?

Is Ms Yun liable to pay exemplary damages?

Topics & place

Residential Tenancies Act sections

Key findings

Frequently asked questions