- One Meth case a week hits the Tenancy Tribunal
- Practice Notes a necessity as Tribunal Orders highlight inconsistencies across New Zealand
- Are Property Management companies being unfairly held liable for cases?
Research has shown that Tenancy Tribunal is dealing with a least one case a week regarding Methamphetamine contamination across New Zealand. What is apparent is that the level of inconsistencies across some of the decisions is concerning and we believe that Property Management companies are being unfairly held liable for damages out of their control.
Evidence in many cases we have researched has shown adjudicators are inconsistent in who should pay the damages.
What we have also discovered is that different adjudicators have differing opinions as to what constitutes safe levels of contamination before a property is in breach of the Residential Tenancies Act. Section 45 of the RTA is referred to in most cases which states the Landlords have a responsibility to provide the property inhabitable, in a reasonable state of repair, compliant with Building, Health and Safety Act and also in a reasonably clean condition.
In certain cases, we have found one adjudicator of the opinion that any level of Methamphetamine contamination is too high, even if it is under the Ministry of Health guidelines. Adjudicator Hogan states in Tribunal order of Harris v Thomas Baseden Real Estate that "in my view, if the property is contaminated with methamphetamine, at any level, it is unclean and in breach of section 45(1)(a)." (provide the property in a reasonable state of cleanliness). In the same order, adjudicator Hogan states that a landlord should , as a matter of best practice, have a property tested at the commencement of a tenancy.
Adjudicator Hogan's opinion is shared by Head Adjudicator Melissa Poole. Ms Poole confirmed the Tribunal stance that any level of Meth was too high even if it was under MOH Guidelines whilst she was speaking at the REINZ Conference in early August.
However, other adjudicators take a different stance with cases being dismissed even with evidence of Meth being detected in discrete tests. What is worse, in one particular case a composite test carried out by Meth Solutions gave a reading of 1.13 micrograms per 100cm2, yet discrete tests carried out on the same property by The Drug Detection Agency gave readings between 0.02 and 0.31 micrograms per 100cm2. This case was, in our opinion, rightfully dismissed.
Should Property Managers Be Jointly Liable?
In the Harris v Thomas Baseden Real Estate case, the Adjudicator holds the Property Manager jointly liable, even though the landlord is clearly named on the Tribunal Order.
In Visagie v Harper Property Management Ltd held early this year, Adjudicator Benvie ordered the landlord only and not Harper Property Management to pay the tenants $7,525 in a case around meth contamination.
Why was Harper Property Management let off the hook whilst Thomas Baseden Real Estate wasn't?
Adjudicator Benvie states in the order "Although the agent was named as a party, the above orders are made against the landlord only because the tenancy agreement makes it clear that the agent was executing the tenancy agreement as agent only".
One must come to the conclusion that Thomas Baseden Real Estate had not stated the landlord's name on the tenancy agreement and they weren't acting as the agent.
However, this may not be the case. In November this year, a case between Heathcote and Xclusive Management Ltd awarded damages to the tenant and states very clearly that "Xclusive Management Limited as agent for .... is to pay the tenant the sum of $1,051.25".
We also have many more cases on file where Property Management companies are being held jointly liable even when it clearly states on Tribunal Orders that they are acting as the agent.
Why are some adjudicators doing this? Is it a lack of legal knowledge, or are they simply picking on the easy target?
One can only speculate, but it is unfair that a company is held liable even when technically they should not be.
New Guidelines in Play, But Do The Rules Change?
As the Property Management industry desperately awaits standards set in place around Meth Testing and what constitutes a safe limit, new documents recently prepared for the Ministry of Health have increased the recommended remediated standards for a non-lab house to 1.5 micrograms per 100cm2 for carpeted properties and 2.0 micrograms per 100cm2 for non-carpeted properties.
There is no evidence as yet that indicates Tenancy Tribunal will follow these new recommendations, even though there is a growing sense that landlords are being unnecessarily fleeced of money.
More Practice Notes Required
With one case a week on average being heard in Tenancy Tribunal, Ms Poole can not afford to wait for the Government to make up its mind on what standards will be in place for Meth and the testing companies which have exploded in numbers over the last 12 months.
Our investigation highlights the inconsistencies and dilemmas faced by many within our industry and Practice Notes for dealing with Meth must surely be required to provide a consistent and accurate approach in how to deal with this increasingly problematic issue.
While Ms Poole is at it, we would also like her to clarify who is liable to pay for costs and damages awarded to the tenant. We hope she listens; watch this space.
We would love to hear about your experiences in Tribunal. Let us know of any interesting cases or thoughts around the process which is Tenancy Tribunal.