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Big damage pay-out awarded to landlord

Tenant liability for damage has long been a fraught issue but a new Tenancy Tribunal case shows that damage rulings can sometimes favour a landlord.

Monday, October 5th 2020, 11:14AM 1 Comment

by Miriam Bell

Damaged walls, carpets, and kitchen appliances. Cigarette burns on floors and tiling. A broken garage door.

This catalogue of destruction is a landlord’s nightmare – and it’s what faced KPKR Investment Group Limited when the tenancy of one of their rental properties ended recently.

When Faith Dryer’s tenancy came to an end in early August, they found the Tuakau rental had suffered extensive damage which, in their view, was intentional.

The situation prompted KPKR Investment Group (represented by K.Patel) to head to the Tenancy Tribunal to try and recoup some costs.

As many landlords know, when it comes to tenant damage this can be problematic.

That’s because, under the Residential Tenancies Act, a landlord must prove that damage to the premises occurred during the tenancy and is more than fair wear and tear.

If this is established, the tenant must prove they did not carelessly or intentionally cause or permit the damage in order to avoid liability.

Where it’s found the damage has been caused carelessly, and is covered by the landlord's insurance, the tenant's liability is limited to the lesser of the insurance excess or four weeks' rent.

However, tenants are liable for the cost of repairing damage that is intentional or which results from any activity at the premises that is an imprisonable offence.

In the ruling on this case, Tribunal adjudicator, J.Tam, explains that damage is intentional where a person intends to cause damage and takes the necessary steps to achieve that purpose.

“Damage is also intentional where a person does something, or allows a situation to continue, knowing that damage is a certainty.”

Tam divided up the catalogue to the Tuakau property into damage which was intentionally caused and damage which was carelessly caused.

The following damage was intentionally caused during the tenancy: damage to the walls, dishwasher, rangehood, kitchen drawer, tiling and flooring.

“The damage is more than fair wear and tear, and the tenant has not disproved liability for the damage,” Tam said.

The following damage was carelessly caused during the tenancy: damage to the garage door, carpet, and bathroom.

“The damage is more than fair wear and tear, and the tenant has not disproved liability for the damage,” Tam said. “Liability on careless damage however has been limited to four weeks' rent.”

For that reason, Dryer was ordered to pay KPKR Investment Group Limited $17,090 immediately.

Tam also broke down the damage into categories and applied relevant costs to each group, with the biggest amounts ordered for wall repairs including painting ($7,530) and the replacement of oven, dishwasher, rangehood, and kitchen drawers ($3,750).

Read more:

Tenants liable for careless damage – to a point 

Tags: compliance conduct damage damage liability housing market insurance investment landlords property investment property management rental market RTA Tenancy Tribunal tenants

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Comments from our readers

On 5 October 2020 at 10:35 pm Peter L said:
"For that reason, Dryer was ordered to pay KPKR Investment Group Limited $17,090 immediately."

And pigs will fly.

An award is one thing, actually getting the money is another, and the law is of very little help here.

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