Order of the Tenancy Tribunal

Transcription

1 Order of the Tenancy Tribunal Residential Tenancies Act 1986 Office of the Tenancy Tribunal Tenancy Tribunal at Tauranga Tenancy Address 121 Harbour View Road, Omokoroa 3114 Applicant Full Name Maryanne Elizabeth Brunetti Tenant Respondents Full Name Ash Bailey Landlord Order of the Tribunal The Tribunal hereby Orders: 1. Ash Bailey to pay Maryanne Brunetti the sum of $5, immediately calculated as follows: 2. By way of Declaration, Ms Bailey is responsible for mowing the lawns and Ms Brunetti is responsible for maintaining the gardens at the premises. 3. Compensation for failure to maintain $2, Exemplary damages - failure to maintain $2, Exemplary damages - rent summary $ Exemplary damages - insulation statement $ Breach of quiet enjoyment $ Amount payable by Landlord to Tenant $5, The claim that the notice to quit is retaliatory is dismissed. The notice is extended to midnight on Monday 2 July 2018 when the tenancy will terminate. (Sections 38, 45, 77(2)(n) & (q), 78(1)(a), (d) & ( i), 96(2) and 109 Residential Tenancies Act 1986)

2 Reasons: This is a periodic tenancy which commenced on 15 September 2017 as a result of a verbal agreement between the parties. 2. Ms Brunetti (tenant) seeks a refund of all rent as she says this is an illegal garage conversion. Ms Brunetti also seeks a declaration that a notice to quit is retaliatory and exemplary damages. Ms Brunetti also seeks compensation and exemplary damages for the following: - landlord s failure to meet her obligations in respect of maintenance, smoke alarms, insulation, or building, or health and safety requirements; - landlord s failure to provide a written statement of rent; - landlord s failure to provide an insulation statement. Ms Bailey (landlord) filed a cross application and seeks exemplary damages for the tenant s failure to allow entry for inspection purposes, and a declaration as to who is responsible for maintaining the lawns and gardens. The applications were part-heard on 20 April 2018 (due to time restrictions) and resumed on 12 June The hearings were acrimonious and the parties were strongly opposed and entrenched in their positions on most issues. It may be helpful to point out that in determining an issue the Tribunal must be sufficiently certain on the balance of probabilities before making an order in favour of a particular party. Both parties filed lengthy submissions and evidence. It should be noted that an Adjudicator has no obligation to refer to each and every aspect of the evidence presented ( Repia v Walsh Trust DC Waitakere CIV , 27 April 2011). This decision will summarise the relevant and pertinent evidence before providing an explanation for the conclusions reached. Did the landlord let an unconsented dwelling, and does this entitle the tenant to a full rent refund? There is no dispute that the garage of the original dwelling (where the landlord resides) was converted to a residential dwelling without building consent or resource consent. In this case the tenant has initially applied for a refund of all rent paid during the tenancy in reliance on the High Court decision of Anderson v FM Custodians [2013] NZHC 2423 and section 137 of the Residential Tenancies Act 1986 ( the Act ). The tenant says that the premises has been damp and mouldy from the outset of the tenancy. The premises consist of a small self-contained studio with kitchen, dining, bedroom all in one, and an ensuite bathroom. The parties share the laundry in the landlord s house next door. 8. The landlord says this is a technical breach similar to the Parry case ( Inglis v Parry [2017] NZDC 2636); the tenant did not raise the issue until she was given notice to quit; and the tenant has suffered no detriment as a result. 9. A recent Tribunal decision (AP Heer Ltd v Hayward [2018] TT & , Tauranga, 8 May 2018) provides a comprehensive analysis of the developing caselaw. In summary [at paragraph 33], there are two decisions of the District Court which find that Anderson is binding in section 65 [of the Act] cases, but is only persuasive in relation to landlord and tenant cases.

3 There is one District Court case that takes a contrary view. The Tribunal is bound by decisions of the District Court. However, as there are conflicting decisions on the same issue, it must determine as best it can which line of decisions most accurately represent the law. I share the view of the Adjudicator in the Hayward case that Anderson is persuasive but not binding. Applying s 45(1)(c) and 45( 1A), rather than s 137, enables the Tribunal to make an order tailored to the "substantial merits and justice of the case", which is the cornerstone of the Tribunal's jurisdiction under s 85(2) RTA (as discussed in Liow and Tan v Arzi [2016] NZTT, Manukau, ). I find that it is not appropriate to apply the reasoning in Anderson to the present case and I will proceed to consider the tenant s claims and the landlord s alleged breach(es) under section 45 rather than section 137 of the Act. Ms Brunetti's case 12. Ms Brunetti says she had concerns from the beginning that fuses were popping and there was a strong musty smell from the rear of the premises; and that the grounds were overgrown and untidy and a muddy bank was not retained. Ms Brunetti says the bank was subsequently fixed and the landlord mowed the lawns while she did some planting and weeding. She found the carpet at the front door to be mouldy and damp and the concrete underneath was also mouldy. In addition, the entrance doorway did not completely open as one door did not work and seemed to have dropped. Ms Brunetti says she spoke with Ms Bailey on move in day and she agreed the door should be fixed but this has not been done. Ms Brunetti subsequently found leaks coming through the joinery of the front door as it was broken and weathered and the glass was unstable. Ms Brunetti says she mentioned the dampness to the landlord s mother and showed Ms Bailey the water ingress causing a damp area at the front door and damp and mould along the left wall, back wall (bedroom area), and right corner and damp stains on the carpet in and around February Ms Brunetti says work began in late February to dig up an area outside and install a drain which continued for around a month and the area was unusable as it was very muddy with debris and glass. Ms Brunetti contacted the local Council to make enquiries about the premises as she was increasingly concerned and found it be unconsented for permanent habitation. Ms Brunetti complained about water coming through the front door and dampness and was told if she was not happy she should move. On 19 March 2018, the landlord gave Ms Brunetti a 21-day notice to leave the premises and Ms Brunetti gave her a 14-day notice that day to fix various maintenance issues which she says she had already drafted. Ms Brunetti received the 14-day notice back with a handwritten note, sorry cannot afford to do this so this is another reason for you to leave. Ms Brunetti then received an amended 42-day notice on 20 March 2018 and says that there was an altercation between the parties and she was told to go as she wasn t a legal tenant. Ms Brunetti says that from this time she was subject to harassing and intimating behaviour by Ms Bailey and verbal abuse. She says Ms Bailey attached a series of notices on the front door despite being asked to put them in the post-box; access to the laundry was restricted; and she turned up at the door with her ex-husband leaving Ms Brunetti feeling vulnerable. Ms Brunetti says that despite the external works and sealing of gaps, the damp and water ingress is ongoing and there is no

4 point allowing access to put down a new carpet until the problems are solved. Ms Brunetti says that a smoke alarm was not installed until some 6 months into the tenancy and she has not received a rent summary despite repeated requests; nor an insulation statement. Ms Bailey s response Ms Bailey agrees the retaining wall was a mess at the start of the tenancy but says everything else was clean and tidy. Ms Bailey says she assumed the tenant would look after the lawns and garden and when it became a mess, she did it herself. Ms Bailey maintains that the premises are not damp or mouldy as it has a heat pump and is fully insulated; except for underneath. Ms Bailey says that water leaks started in February at the time of Cyclone Gita and it came from underneath as water was pooling in that area. Ms Bailey says it was only a problem in heavy continuous rain and it took a couple of weeks to install a drain and complete groundworks. Ms Bailey acknowledges the studio is not consented and she knew it was only to be used as an art studio but says it is 'liveable' and she will be applying for a certificate of acceptance in the future if finances allow. Ms Bailey says that she supplied a smoke alarm 2 days into the tenancy and the tenant said to leave it on a shelf. Ms Bailey says she found it unopened in April so she installed it immediately. Ms Bailey says that her handwritten note on the tenant s 14-day notice was her initial response as she was upset the tenant had not spoken with her about any of the issues. Ms Bailey says a heated argument took place and she agrees she told Ms Brunetti to move out if she was not happy. Ms Bailey says that all maintenance issues have been addressed except for the front door due to economic reasons and the new carpet cannot be installed as the tenant will not allow access. Ms Bailey says that the eviction notice is not retaliatory as it came before the tenant s 14-day notice and the studio is needed for a family member returning from overseas. She agrees she made a mistake of 21 days and amended this by giving a new notice with the correct 42 days the following day. Ms Bailey says she has been taping notices on the tenant s door as she cannot be sure that the tenant will collect her mail. Ms Bailey denies any intimidating or bullying behaviour and says everything was good until she gave the tenant notice and it has all been blown out of proportion. Ms Bailey agrees she has restricted access the shared laundry as her mother felt uncomfortable in the tenant s presence. Did the landlord breach her maintenance obligations? The Tribunal can award both compensation and exemplary damages for a breach of section 45 (1)(b), (ba) and (c) RTA, which provides that a landlord must provide and maintain the premises in a reasonable state of repair, comply with all requirements in respect of smoke alarms imposed on the landlord by regulations, and comply with any relevant enactment in relation to buildings, health and safety. Regulation 15 of the Housing Improvement Regulations 1947 requires that every house shall be free from dampness. 15. Breaching this obligation is an unlawful act for which exemplary damages may be awarded up to a maximum of $4,000 (section 45( 1A) and Schedule 1A of the Act). Where a party has committed an unlawful act intentionally, the Tribunal may award exemplary damages where 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 (section 109(3) of the Act).

5 Failure to give a written statement of the period to which any payment of rent relates is an unlawful act (section 29(5) of the Act) for which exemplary damages up to a maximum of $200 may be awarded. Landlords must also provide a signed statement about the insulation in the premises in all tenancy agreements entered in to from 1 July 2016 (section 13A( 1A)-( 1F) of the Act). Breaching this obligation is an unlawful act for which exemplary damages up to a maximum of $500 may be awarded. I find that Ms Bailey breached her maintenance obligations at the start and during the tenancy. The premises have neither resource nor buidling consent. The purpose of the Building Act 2004 is to ensure buildings are safe and healthy and that people can escape from them if there is a fire. The landlord gave evidence that she has not yet applied for a certificate of acceptance due to economic reasons and this is nothing more than a technical defect in any event. I find this unacceptable given that the premises are being let for residential purposes with the inherent health and safety risks of occupying a building which has not been subject to the required checks of structural stability, fire safety, access, moisture control, durability, services and facilities, as set down in the Building Code. I find it is more likely that the damp problem relates to an inherent defect rather than a one-off flooding. Photographs and evidence provided by the parties, and in particular, the admission by Ms Bailey of water pooling underneath the premises in bad weather, is sufficient to convince me that the premises were damp and mouldy throughout the tenancy. The tenant has suffered a considerable detriment to her tenancy as a result. The front doors are defective and contribute to dampness and leaks. In addition, it is the landlord s responsibility to ensure that smoke alarms are fitted at the start of the tenancy and it is not appropriate to abdicate responsibility to the tenant. Ms Bailey has also failed to provide the rental summary requested by Ms Brunetti and any insulation statement. The statement in the Trade-Me advertisement that the premises is fully insulated does not satisfy the statutory requirements. With regards to the shared laundry access, I find that this was an agreed term of the tenancy which the landlord subsequently breached by unreasonably restricting the times it could be used. No party may unilaterally change the terms of a contract and force the other party to accept this. Quantifying the tenant s loss is not an exact science. Weighing the substantial merits and justice of the case and the seriousness of the breaches, I find that an award of compensation of $2000 (approximately equivalent to a reduction of one-quarter of rent paid) as fair, reasonable and proportionate compensation. This award includes the claim for laundry and moving costs. I also find it just to make an award of exemplary damages of $2500. The landlord knew from the outset that the studio was unconsented. There is a strong public interest in ensuring that landlords comply with their statutory requirements and provide and maintain properties to a reasonable standard. I also make awards of exemplary damages of $100 for failure to provide a rent summary (receipts were provided) and $150 for failure to provide an insulation statement. Was the notice to quit retaliatory? 19. On 19 March 2018, Ms Bailey gave Ms Brunetti a 21-day notice to end the tenancy. Ms Bailey says she realised her mistake and issued a 42-day notice the following day.

6 Where the owner of the premises requires the premises as the principal place of residence for the owner or any member of that owner s family, the minimum period of notice required to be given by a landlord to terminate the tenancy is 42 days. Ms Brunetti claims the notice is retaliatory and must be set aside. Ms Brunetti also claims exemplary damages. 22. For a notice to be declared retaliatory the tenant must prove the landlord was motivated wholly or partly by the tenant exercising a right under the tenancy agreement or any Act, or by any complaint against the landlord (s 54(1) Residential Tenancies Act 1986). Giving a termination notice which is declared to be retaliatory is an unlawful act for which exemplary damages may be awarded up to a maximum of $4, (sections 54(2), (3) and Schedule 1A of the Act). On balance, I am not persuaded that the notice to quit was retaliatory. Ms Bailey has provided sufficient convincing evidence that her reason existed independently, and not because of, complaints by Ms Brunetti. Ms Bailey was actively addressing the water ingress problems by engaging a contractor to carry out ground works and installing drainage. The 14-day notice from Ms Brunetti came after the initial notice to quit. I accept the evidence of Ms Bailey that she issued the notice as a family member is in need. The application to set aside the notice is dismissed. However, in the circumstances of the case, I exercise my discretion under section 96(2)(a) of the Act to grant an extension to the notice and allow Ms Brunetti additional time to vacate the premises. 25. Ms Brunetti indicated that she is actively seeking alternative accommodation in any event. I consider it fair and reasonable that in consideration of Ms Brunetti and the need for her to find alternative accommodation, the tenancy will end a further 10 days from the date of this Order by midnight on Monday 2 July Did the landlord breach the tenant s quiet enjoyment of the premises? By virtue of section 38(2) of the Act, the landlord shall not cause or permit any interference with the reasonable peace, comfort or privacy of the tenant in the use of the premises by the tenant. Contravention of this section in circumstances that amount to harassment of the tenant is an unlawful act (s.38(3) of the Act). A single incident may amount to a breach but the consequences require a degree of seriousness that warrant a finding that reasonable peace has been disturbed. Whether this test is made out requires an objective assessment of the true nature of the significance of the interference in the particular circumstances (Marino & Ors v Wellington City Council, DC, Wellington, CIV , 23 September 2013). There is clearly a personality clash between the tenant and the landlord with each party blaming the other for arguments and raised voices. The Tribunal has taken the view in the past that a personality clash does not of itself amount to a breach of quiet enjoyment. Whilst it can impact on reasonable peace and comfort in a significant way, more is needed to prove the landlord is liable for the breach. In Smith & Olmstead v Floris (TT 93/1404/AK) the Tribunal stated that, landlord/tenant relationships tend to be between individuals and that will inevitably involve some interaction between them on a personal level. It is important not to allow a simple clash of personality to become the sole basis for a claim for a breach of this type. However, I find that Ms Bailey did breach the tenant s

7 I am not persuaded that an award of exemplary damages is appropriate in the circumstances. I find that Ms Brunetti mistakenly believed the landlord did not have any legal right to inspect on 30 March and 8 April after she failed to turn up without any communication on 27 March. At the initial hearing, I advised the parties of their respective rights and obligations in respect of allowing entry to the premises and since then, the landlord has carried out an inspection without any delay. The claim for exemplary damages is dismissed. 32. I do not accept Ms Bailey's argument that Ms Brunetti has failed to mitigate her losses as she refused entry to the premises. I accept the evidence of Ms Brunetti that the water ingress and damp problems are ongoing and cannot be solved by the installation of a new carpet. Since the last hearing, Ms Bailey has entered the premises in any event. 33. reasonable peace when she insisted on taping notices to the door when the tenant specifically asked her to leave them in the post-box. Considering the annoyance, stress and worry caused by an unreasonable infringement on Ms Brunetti s personal space, I make an award of $ as fair and reasonable compensation. I do not find sufficient evidence of behaviour amounted to harassment. There are allegations and counter allegations by the parties with no corroborative or independent evidence and in these circumstances, given the conflicting views and lack of supporting evidence, I find this aspect of the claim has not been established. Cross application failure to allow entry Failure by the tenant, without reasonable excuse, to allow the landlord to enter upon the premises in any circumstances in which the landlord is entitled to enter is an unlawful act. Ms Bailey agrees she did not show up for an arranged inspection on 27 March as she thought she had not given enough notice. She says she has been denied entry for inspection purposes on at least 2 occasions since then as the tenant was not at home on 30 March and she did not have a key, and on 8 April when she refused to let her in. The landlord confirmed that since the last hearing the tenant has allowed access for inspection purposes and has given her a key to copy. Gardens and lawns Both parties believe that each other is responsible for the lawns and gardens. Generally, the tenant has a responsibility to keep the premises reasonably clean and tidy and this includes lawns and gardens (section 40(1)(c) of the Act). However, by virtue of section 11(2), landlords may voluntarily incur more obligations than those imposed by the Act (section 11(2) of the Act). In this case I find that Ms Bailey assumed responsibility for the lawns by mowing voluntarily without recourse to Ms Brunetti; and Ms Brunetti assumed responsibility for the gardens by weeding and planting. I make a declaration to that effect. The parties should note that the obligation is not to keep the lawns and gardens any tidier than they were at the commencement of the tenancy (Westwood v Western [1994] DCR 759).