Property Management

Tribunal: Tenants’ bond ‘kept in a tin’

A $280 bond “kept in a tin” for a decade was evidence in a Dunedin Tenancy Tribunal hearing resulting in $15,900 being awarded to the tenants.

Friday, July 30th 2021

Jill and Falconer Smith began renting a Balclutha farmhouse owned by Ralph Cochrane in May 2011. A $280 bond was paid to Cochrane and “kept in a tin”.

Cochrane admitted he did not lodge the bond as he did not know he needed to and only found out when the Cochranes filed a Tenancy Tribunal application in June.

The application challenged a termination notice as retaliatory and sought compensation for failure to insulate the premises.

The tribunal considered Cochrane’s failure to lodge the bond was unintentional and the result of ignorance of the law relating to renting of premises.

It did not award exemplary damages but ordered him to lodge it immediately.

Rent increase

During the tenancy Cochrane increased the rent from $140 a week – $560 per month, to $180 per week – $720 per month to start on April 21, 2014.

Finding the increase did not meet the RTA requirements because only 20 days’ notice was given instead of the minimum 60 days, the tribunal awarded a refund of 88 monthly payments of the extra $160 made by the Smiths since the date of increase, equalling $14,080.

The rent was set again at $140 a week.

Insulation failures

The Smiths also claimed the landlord failed to insulate the premises.

When they bought heaters for the bedrooms in 2019, the Smiths had asked Cochrane about ceiling insulation and provided him with copies of the relevant material.

Photographs were given to the tribunal adjudicator.

They also claimed there was no underfloor insulation.

Cochrane had been aware of this since June 2020 when a plumber looked at why there was underfloor dampness in one bedroom.

Cochrane told the tribunal he did not know about the insulation requirements until told by the Smiths in March or April 2020.

He obtained a quote to reroof the house in October 2020, which would have included upgrading insulation, but the work has yet to be started as has work on underfloor insulation.

While initially Cochrane may have been ignorant of the requirements, the tribunal said by May 2019 he was aware of his obligations and from that date intentionally failed to comply.

Although Cochrane experienced difficulties in arranging tradespeople due to Covid-19 lockdowns and the fact that the premises are situated in a rural location the tribunal said this was not an excuse.

“The renting of premises is a business. Landlords have obligations under the legislation and need to comply with these irrespective of their personal circumstances,” said the tribunal.

“Tenants should not be expected to live in properties which do not comply with the legislative requirements because the landlord has not made sufficient effort to rectify the situation when made aware of issues.”

Exemplary damages of $1,800 were awarded to the Smiths and a work order was made for the insulation to be carried out by either February next year or 90 days after a new tenancy starts.

Notice

Cochrane issued a 120-day eviction notice to the Smiths in May this year, which they claimed was retaliatory.

The landlord told the tribunal “Due to many increasing changes in the farming sector, the time has come to end the tenancy on the house.”

Because of personal circumstances he wanted to slow down, upgrade the premises and his existing home and move into the rental premises sometime after February next year.

However, the tribunal said at best Cochrane was vague about when he wanted to move into the property.

The only evidence of upgrading work was that double glazing had been installed in February 2019. And although a quote was obtained in 2017 for the kitchen this work had not gone ahead.

The tribunal said it was not persuaded Cochrane had any intention of moving into the premises by December 29, being 90 days after the termination date.

It declared the notice invalid and the tenancy continuing.

Comments

On Friday, July 30th 2021 12:55 am Tania T said:

The rent increase did meet the RTA requirements if it happened after 180days since tenancy started, it is the notice period did not meet the required length of RTA. The tribunal should reward refund of 40 days because only 20 days’ notice was given instead of the minimum 60 days. It's not fair to award a refund of 88 monthly payments.

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