Reform of the Residential Tenancies Act 1986 Discussion Document: A

Response
JN Consulting, October 2018
October 2018

About Me

JN Consulting is the policy consultancy practice of Joseph Nunweek. I am a practicing solicitor

admitted to the Supreme Court of Victoria, having previously been admitted to the High Court of
New Zealand. I have previously worked in community law, legal education and publishing, and
parliamentary services.

Our policy interests lie around consumer law and poverty. In my capacity as a community lawyer, I
have previously contributed to the Residential Tenancies Act review in Victoria, Australia, as ill as the
Commonwealth’s review of the Australian Consumer Law and Fair Trading Act (ACLFTA). I have also
appeared before a Victorian State Senate Inquiry into the Retirement Living Sector.
From a policy perspective, I am interested in how progressive governments who share like-minded
goals in the consumer and poverty law sector can share best practice and refine each other’s
developments. I believe that in doing so, they can enact fair baselines for consumer protection
(including in housing) which ensure the dignity, well-being and autonomy of individuals, families and
communities and are built to last (i.e., they become a shared standard, irrespective of future
electoral outcomes).
Overview

I appreciate the opportunity to be able to contribute a submission to the Ministry of Housing and
Urban Development discussion document, which when translated into legislation will represent the
largest change to Aotearoa New Zealand’s residential tenancy legislation in three decades.

I acknowledge, as does the discussion document, that modernising rental law is one mechanism of
many in the government’s project to address the housing crisis. To be effective, they will operate in
concert with:

- The establishment and expansion of KiwiBuild;

- A simultaneous commitment to increase the social housing stock, in additional to new builds
for first-home buyers;
- A review of tax settings;
- Informed investigation into the extent of possible speculative practices including empty
homes and land banking.

However, the reality is that the proportion of New Zealanders renting has increased and will
continue to increase, and that this will be the lifelong living situation for many of those New
Zealanders. Within that environment, they should enjoy a modern set of rights and protections.

It should also be borne in mind that the division between homeownership and lifelong renting can
also be a gendered and racialised one. Homeownership for Māori and Pacific people has
continuously been lower than that of the NZ population overall and fell faster than that of the
overall population between 1986 and 2013.1 Single women with children are also more likely to rent
and less likely to build the savings needed for home ownership.

At present, these tenants may face greater housing costs overall as a proportion of income, greater
household crowding, and have to move more frequently. As with other housing crisis solutions,
changes to rental laws should seek to relieve rather than exacerbate this.

Although the intended aim of the government’s combined reforms is to help increase the supply of
housing (both rental and owner-occupied) over time, My position is that the legislation should
remain fit for purpose to offer a strong level of basic protections to the most vulnerable tenants in
the long-term, as I do not anticipate that these most vulnerable tenants will disappear from the
private rental market.

However, in order to make any new legislation more flexible and responsive over time, I recommend
in some circumstances that certain time limits or requirements are not enshrined in the legislation
itself but are instead “prescribed periods” or “prescribed considerations” that may be set from time
to time (i.e, a tenant’s given notice period for vacating).

Scope

I address most (though not all) focusing questions in the discussion document in the same order as
they are approached in the document. A short preamble with additional remarks or observations
precedes my responses in some instances.

I acknowledge the scope of the discussion document does not include reforms of the composition,
jurisdiction and structure of the Tenancy Tribunal but nonetheless note a number of areas where the
legislation could guide, expand or proscribe the Tribunal’s discretion and decision-making power.

Specialist family violence amendments are not discussed in the document. In a short appendix, I
address the importance of incorporating specific rights for the survivors and victims of family
violence, with particular reference to the Victorian State Government’s Royal Commission on Family
Violence completed in 2016. My personal view is that family violence matters should be treated as a
priority reform alongside those correctly identified in the document.

1
Statistics New Zealand, 2013 Census Ethnic Group Profiles: Māori http://archive.stats.govt.nz/Census/2013-

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No-Cause Terminations and Other Bases To Terminate A Tenancy

I strongly support the removal of no-cause terminations from the Act. The existing mechanism in
which tenants may challenge such a notice on the basis that it was retaliatory is insufficient for a
number of reasons:

- Tenants may not be aware that the process is available to them;

- Tenants may find the process of challenging a notice difficult or intimidating;
- While some cases of retaliation (for example, a no-reason termination after asking for
repairs) may be easy to prove with an e-mail or paper trail, other tenants may have only
verbal or unwritten evidence which is hard to prove a case on;
- In my experience of litigation involving no-cause terminations, some landlords and agents
are adept at refuting allegations of retaliation and produce stock responses or defences.

In a housing crisis, no-cause terminations may be apt to lead to homelessness in spite of their longer
termination periods. At present, any unnecessary or arbitrary notice to terminate occurs in an
environment where alternative affordable rental housing is extremely limited – the median rent in
Auckland as of May 2018 was $550/week2, while the maximum amount of benefit and
accommodation supplement a sole parent with 2 or more children could anticipate would be
approximately $640/week.3

Given the personal wellbeing and community impacts of losing one’s home and the upheaval of
having to move (as ill as the attendant costs to the social welfare, justice and health sectors4) it
should be asked why rental rights can be terminated with no reason when people are largely
protected from the same in their workplaces (excluding section 67A of the Employment Relations Act
1999). Similarly, owner-occupants only have their rights to occupy interfered with in limited ‘for-
cause’ circumstances.

MY view is that the removal of no-cause terminations should apply to both periodic and fixed-term
agreements, assuming both are retained.

Jurisdictions that have done away with the no-cause termination have established a variety of
alternative “at-fault” and “no-fault” for-cause terminations. It is my view that an appropriate array
of for-cause terminations in the legislation will remove the need for a no-cause termination at a
fixed-term agreement’s end.

Victoria, Australia: Termination Grounds

The Victorian State Government’s Residential Tenancies Amendment Bill 2018 institutes the
following grounds for issuing a Notice to Vacate. The table below provides reasons for giving notice,
along with the time period a tenant has to move before the landlord becomes entitled to apply to
the Tribunal for possession of the property.

2
PWC, “New Zealand’s Affordable Housing Dilemma”, June 2018
https://www.pwc.co.nz/pdfs/2018pdfs/affordable-housing-publication-nz-18.pdf
3
Sourced at MSD: https://www.workandincome.govt.nz/products/benefit-rates/benefit-rates-april-
2018.html#null
4
At an Opposition Inquiry in September 2016, the University of Otago’s He Kainga Oranga deputy programme
director Nevil Pierse estimated that each person living in primary homelessness in Aotearoa New Zealand cost
the government around $65,000 in preventable health and justice-related costs. In April 2017, data released to
Newshub indicated the government had spent an average of $98,167 per night on emergency housing grants,
generally provided through payment to private providers such as motels.

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Reason Notice Period Required
Intentional or Reckless Causing of Serious Immediate
Damage to the Premises
Endangering the Safety of Occupiers of Immediate
Neighbouring Premises, Landlord or Landlord’s
Agent or Contractor
Serious Threats to or Intimidation of Landlord or Immediate. The tenant retains the right to
Agent/Contractor challenge the notice if it was issued on
retaliatory grounds.
Premises are Destroyed or Become Unfit for Immediate
Human Habitation (i.e; fire, flood, contamination
Rental Arrears of more than 14 days 14 Days. On 1st, 2nd, 3rd or 4th occasion in 12
months landlord applies to Tribunal for
possession order, Tribunal may place tenant on
payment plan and adjourn the application
provided it is satisfied financial loss to landlord
can be averted.
Failure to pay bond if requested. 14 Days.
Failure to comply with an order of the Tribunal 14 Days.
as to compliance with tenant’s duties
Successive Breaches of A Tenants’ Duty (3-strikes 14 Days, if
rule) - Tenant has twice breached duties
Duties under Victorian legislation are to: previously;
- Not use rented premises or permit use in - Landlord has given notice of breach of
a manner that causes nuisance or duty in writing each time.
interference with reasonable peace,
comfort or privacy of any occupier of
neighbouring premises.
- Not to intentionally or negligently cause
damage to rented premises.
- Notify landlord of damage as soon as
practicable.
- Keep premises reasonably clean.
- Not tamper with any safety-related
devices.
Use of premises for illegal purpose 14 Days.
Drug-related conduct in public housing 14 Days.
False statement to a social housing provider with 14 Days.
respect to eligibility.
Assignment or subletting without consent 14 Days.
Landlord Intends to Repair, Renovate or 60 Days.
Reconstruct Property to Extent that Tenant
Cannot Occupy Property While Work Is Being
Carried Out
Landlord Intends to Demolish Premises 60 Days.
Premises to Be Used for Non-Residential 60 Days.
Purposes
Premises to Be Occupied By Owner or Member 60 Days.
of Owner’s Immediate Family or Household
Premises to Be Sold for Vacant Possession 60 Days.
Premises to Be Used For Public Purposes 60 Days.

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End of A Fixed-Term Lease’s First Term 90 Days. The tenant retains the right to
challenge the notice if it was issued on
retaliatory grounds.
Tenant Has Ceased To Meet Social Housing 90 Days.
Eligibility Criteria (subject to govt setting out
criteria)
Tenant in Transitional Housing Refuses To 30 Days
Comply With Requirements to Seek Alternative
Accommodation (subject to govt setting out
criteria)
Notice to Vacate When Pet Not Removed Within 28 Days.
14 Days Of Tribunal Order Requiring Pet’s
Exclusion
Notice By Mortgagee of Property 60 Days.

The Victorian bill also confers a broad discretion on the Tribunal, in making a possession order, to
consider whether doing so is reasonable and proportionate in all the circumstances. These include:

- The nature, frequency and duration of any conduct by the tenant which led to the Notice to
Vacate being given;
- Whether a tenant’s breach of law was trivial;
- Whether the breach was caused by any person other than the tenant;
- Any matters in relation to the breach involving family violence or personal violence
(justifying a protection order or restraining order);
- Whether the breach has been remedied as far as is practicable;
- Whether the tenant has or will soon have capacity to remedy a breach;
- The effect of the tenant’s conduct on others;
- Whether any course of action is reasonably available apart from making a possession order.

Tasmania

Tasmania’s Residential Tenancy Act 1997 sets out the following grounds of termination:

Reason Notice Period Required

Tenant Has Failed To Comply With Any Provision 14 days. NB: agreements or provisions of
of The Tenancy Agreement agreements may be declared invalid if they are
contrary to the law. A notice to vacate on the
basis of non-payment of rent will become invalid
where the tenant pays all arrears in rent before
the vacate date, unless 2 or more notices to
vacate on the basis of non-payment of rent have
been served on the tenant in the past 12
months. A notice to vacate will become invalid if
a tenant becomes complaint with the provision
before the vacate date.
Tenant Has Caused Nuisance at the Property 14 days.
That Is Substantial.
Sale of Property 42 days.
Use for non-residential purposes 42 days.
Property to undergo significant renovations 42 days.
Property to be occupied by family member of 42 days.

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owner.
End of fixed-term lease 60 days NB: This notice may be challenged.
Foreclosure or Mortgagee sale of property 60 days.

As with Victoria, discretion is conferred on a Tasmanian Court assessing whether to grant vacant
possession to satisfy itself that the reason for serving a notice to vacate was “genuine or just”.
Although my view is that the notice periods under Tasmanian law are too brief and I note that they
do retain a no-reason notice for the end of a fixed term, an array of “for-cause” grounds are made
available.

Scotland

The Private Housing (Tenancies) (Scotland) Act 2016 sets out the following bases for landlord
termination (some bases unique to Scotland’s housing culture are omitted, including temporary off-
season letting of student accommodation and the need for a minister or lay missionary to move into
the property):

Reason Notice Period Required

Landlord intends to Sell 84 days if tenant has lived in property longer
than 6 months. Mandatory Ground to Evict.
Mortgage Default 84 days if tenant has lived in property longer
than 6 months. Mandatory Ground to Evict.
Major Re-development of property 84 days if tenant has lived in property longer
than 6 months. Mandatory Ground to Evict.
Landlord Themselves Intends to Live in Property 84 days if tenant has lived in property longer
than 6 months. Mandatory Ground to Evict.
Family member of landlord Intends to Live In 84 days if tenant has lived in property longer
Property. than 6 months. Discretionary Ground to Evict
(Tribunal must assess reasonableness)
Landlord intends to use premises for non- 84 days if tenant has lived in property longer
residential purposes. than 6 months. Mandatory Ground to Evict.
No longer in need of supported accommodation. 84 days if tenant has lived in property longer
than 6 months. Social housing only. Discretionary
Ground to Evict.
Tenant no longer occupying property 28 days. Discretionary Ground to Evict subject to
(abandonment) Tribunal’s assessment of allegations.
Breach of a tenancy agreement condition 28 Days. Discretionary Ground to Evict.
Rent arrears for three consecutive months, with 28 Days. Discretionary Ground to Evict Based on
one month’s rent owing at time of possession Circumstances.
hearing.
Relevant criminal conviction (illegal use of 28 Days. Mandatory Ground to Evict.
property, or offence committed in property
punishable by imprisonment)
Antisocial Behaviour 28 Days. Discretionary Ground to Evict where:
- Application made within 12 months of
antisocial behaviour occurring.
- Behaviour amounts to something that
causes or is likely to cause alarm,
distress, nuisance or annoyance to
another person, including harassment.

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Association With Person Who Has Relevant 28 Days. Discretionary Ground to Evict.
Conviction or Engaged In Relevant Anti-Social
Behaviour.

As indicated, evictions on a “discretionary ground” will only be ordered by the Tribunal if reasonable
in the circumstances. This is broadly in line with the Victorian Tribunal’s statutory discretion to order
possession if reasonable or proportionate in the circumstances. As the Discussion Paper identifies,
the Scottish legislation abolishes the fixed-term residential lease, and with it abolishes no-reason
notices to terminate.

2.1.1 – Notices to Improve Behaviour

The Victorian legislation presently offers two channels by which tenants have an opportunity to
improve behaviour before a landlord may apply to end the tenancy:

1. Compliance Order

A landlord issues a 14-day notice to comply if a tenant is in breach (for example, by causing a
nuisance or not keeping the property reasonably clean).

After 14 days have passed the landlord may apply to the Tribunal for a compliance order.

If satisfied the tenant is in breach, the Tribunal may issue a compliance order with a deadline to
comply.

If the tenant continues to breach the duty after the Tribunal’s deadline, the landlord may issue a
14-day notice terminating the tenancy. The Tribunal will grant a possession order if they believe
doing so is reasonable and proportionate.

2. ‘Three Strikes’ Process

If the landlord has issued two successive 14-day notices to remedy the same breach and the tenant
has not done so, the landlord may issue a 14-day notice terminating the tenancy. The Tribunal will
only grant possession if the landlord has served all previous paperwork correctly, and if doing so
would be reasonable or proportionate.

MY view is that the first of these two options is the best for all parties, and the best to incorporate
into New Zealand law. Seeking a compliance order in the first instance means that a landlord does
not risk having deficient paperwork rejected after a longer period of time, and may resolve
inappropriate landlord expectations or inappropriate tenant behaviour at an earlier stage.

2.1.2 - Specific Notices to Terminate

I believe that the adaptation of a similar set of grounds for termination to those in the Victorian or
Scottish jurisdictions would cover the bases for ending tenancies on a ‘for-cause’ basis in New
Zealand. I would make the following observations:

- I prefer the Victorian ground of ‘serious threats and intimidation’ to the broader ‘antisocial
behaviour’ ground in the Scottish legislation, with a separate process available for less
serious but repeated instances of nuisance. I believe that it is important to be able to
challenge a ‘serious threats and intimidation’ ground on the basis it is retaliatory, as such a
notice may potentially be abused to evict tenants who stridently but lawfully ask for the

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 landlord to perform duties, or to disadvantage tenants who may express themselves in ways
that appear alarming due to disability.

- I would not favour the inclusion of any ground of eviction for associating with a person who
has engaged in relevant antisocial behaviour. This ground, if applied as broadly as the
Scottish legislation, could trigger incompatibility concerns with section 17 of the New
Zealand Bill of Rights Act 1990. More generally, it potentially punishes innocent parties for
taking in whanau or extended family who are homeless and/or recently paroled or released
having been guilty of antisocial criminal behaviour in the past.

- My opinion is that a specific ground of termination relating to the behaviour of dogs or pets
would simply reproduce other more general grounds of nuisance or serious
danger/intimidation. Any ground that relies on a finding on whether an animal has caused
intimidation, rather than an individual, may also have broad implications that unreasonably
punish tenants for unexpected or one-off pet behaviour.

2.1.3 – Evidentiary Issues at the Tribunal

It is difficult for this question not to verge on questions around the Tribunal’s jurisdiction and
procedure, beyond the scope of the present review.

However, I note the operation of section 85 of the Residential Tenancies Act 1986:

Manner in which jurisdiction is to be exercised

(1) Subject to the provisions of this Act and of any regulations made under this Act, the Tribunal shall
exercise its jurisdiction in a manner that is most likely to ensure the fair and expeditious resolution of
disputes between landlords and tenants of residential premises to which this Act applies.

(2) The Tribunal shall determine each dispute according to the general principles of the law relating
to the matter and the substantial merits and justice of the case, but shall not be bound to give effect
to strict legal rights or obligations or to legal forms or technicalities.

As a comparison, this is section 98(1) and 98(2) of Victoria’s Victorian Civil and Administrative
Tribunal Act 1998:

(1) The Tribunal—

(a) is bound by the rules of natural justice;

(b) is not bound by the rules of evidence or any practices or procedures applicable to courts of
record, except to the extent that it adopts those rules, practices or procedures;

(c) may inform itself on any matter as it sees fit;

(d) must conduct each proceeding with as little formality and technicality, and determine each
proceeding with as much speed, as the requirements of this Act and the enabling enactment and a
proper consideration of the matters before it permit.

(2) Without limiting subsection (1)(b), the Tribunal may admit into evidence the contents of any
document despite the non-compliance with any time limit or other requirement specified in the rules
in relation to that document or service of it.

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I submit that the operation of section 85(2) of the New Zealand legislation and section 98(1)(b) of
the Victorian legislation are broadly similar and endow the New Zealand Tribunal with an existing
flexibility about what evidence to accept and how to weigh it.

Currently, the Victorian Civil and Administrative Tribunal (VCAT) will generally allow parties to admit
photographs, letters, statutory declarations and affidavits, and audio-visual recordings. The method
in which these are obtained may affect the weight given to them, having mind to VCAT’s obligation
to follow the rules of natural justice.

During hearings, New Zealand’s Tenancy Tribunal may also wish to consider the capacity for
witnesses and parties to give evidence in remote rooms or by phone where deemed appropriate by
an adjudicator. This may enable participants in a proceeding to offer evidence without the threat of
intimidation.

2.1.4 – Notice periods for sale of property with vacant possession, landlord moving in,
family member moving in.

The analogous time period to vacate under the Victorian legislation for sale, renovation or re-
occupation of the property is 60 days. The analogous time period to vacate under the Scottish
legislation is 84 days.

I believe that any increase in the existing notice periods would be a boon for tenants and reduce the
likelihood that they are forced into homelessness or emergency accommodation. During the longer
notice period, landlords are still entitled to receive rent, so it can be argued that apart from
organising intentions with a property earlier in advance, they cannot be said to be ‘losing out’. A
longer exit period also means that tenants are more likely to have the time to take appropriate steps
such as leaving the property reasonably clean and addressing any minor outstanding repairs.

I further note that section 52 of the existing NZ legislation allows parties to make provision for
shorter notice periods with the Tribunal’s consent, and this could be retained and relied on in special
circumstances.

2.1.5 – Sale of Property For Vacant Possession

As observed, some rental properties that are sold will ultimately require vacant possession due to
the intentions of the purchaser. However, there are clearly instances in which an residential
property investor sells a property to another residential property investor. In these circumstances, it
is not clear why the property needs to necessarily be re-tenanted.

An alternative could be that a notice of termination upon the property’s sale should only be given
where a purchaser has been found and has confirmed their intentions for use of the property
entailing vacant possession. This would not prevent a transfer of title in the interim if desired by
vendor and purchaser, but would a mean a short wait for the new purchaser before they are able to
use the property as intended (if they indeed intend to use it other than as a rental property).

2.1.6 – Right to Advertise For Sale With Vacant Possession

When asked to clarify the most important reason for their last move, ‘landlord sold the house’ was
the most common reason given by the SHORE & Whariki Research Centre’s 2016 tenant survey. In
Auckland, 36% of tenants reported having had to move because the landlord had sold the house, up
from 13% in 2011. Given that the proportion of New Zealand households that rent is increasing and
not decreasing, it is likely that a number of properties ire advertised for sale with vacant possession
only to be re-tenanted as investment properties. This additional ‘churn’ costs households in terms of

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the immediate stress of finding an affordable property in a short time period, the expense and
upheaval of moving, the difficulty of staying close to school and work places, and the unsettling
effects on children (and likely some adults) of shifting out of their home.5

Even if purchasers are not required to stipulate their desire for vacant possession in order for a
notice of termination to be given on the property’s sale, My preference would be that a tenancy
agreement can only be terminated on sale, rather than a landlord’s wish to advertise the property
once empty.

In order for this to be workable for all parties, the expectations around a landlord’s right of entry to
show the property to prospective purchasers (currently contained in section 48(3) of the NZ
legislation) should be retained and clarified.

Similarly to the Victorian legislation, any amended NZ legislation should include the following
provisions around access to prospective purchasers:

- To allow entry to produce advertising images and videos;

- To clarify how often and for how long any open-for-inspections may occur unless otherwise
agreed by the parties;
- Measures in place for a tenant or occupant who is under a protection order to ensure access
for prospective purchasers is by appointment only;
- Prescribed compensation for each sales inspection;
- A tenant may have a right to review and object to advertising images and videos if they are
sensitive, valuable and increase the risk of theft at the premises, or would identify a person
who is presently protected by a protection order.

2.1.7 – Evidence to Accompany A Termination Ground

I support a requirement for basic evidence to be supplied with a notice of termination. This should
be sufficient to establish the ground on which the landlord is seeking to end the tenancy and put a
tenant in an appropriate position to answer the case at any hearing (or, as the case may be, accept
the landlord’s grounds as satisfactory and vacate the property.

I suggest the following examples of appropriate evidence to support kind of notices:

Danger/Damage/Antisocial Behaviour/Nuisance A clear description of the date and time (if

Repairs or Renovations/Demolition/Use for Non-
residential purposes works (if necessary, a draughtsperson or
known) and nature of the conduct, including any
damage or injury caused. If there are multiple
events over time this pattern should be
described in sufficient detail.
Any documents on which the landlord would rely
to substantiate the conduct (such as a police
report or a written complaint)
A clear description of the extent of the intended
architect’s report or quote)
Evidence of any planning or building
consents/permits (if the nature of the work
would require these)

5
BRANZ Report ER22, “The New Zealand Rental Sector”, January 2017, p. 41 and. 53
https://www.branz.co.nz/cms_show_download.php?id=606738ff7cb47451e094ad80f39cc912fa18f7a8

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Family member to move into property The family member who is to move in to the
property should be identified.
Sale of Property A sales authority, evidence of a sale and
purchase agreement. It may be appropriate for a
landlord to redact person information on
documents that does not relate directly to
establishing the property’s transfer.

2.1.8 – False Reasons To Terminate A Tenancy

MY position is that merely serving a Notice that fails to adequately disclose an evidentiary basis or is
mistaken on a technical or substantive basis should not lead to penalties for a landlord. Penalties
should be reserved for circumstances where a landlord uses a false reason to terminate the tenancy
and then relets it to new tenants (for example, a landlord claims their daughter will occupy the
property but it is instead immediately listed online for re-let after the existing tenants voluntarily
leave).

In these situations, my view is that the tenant should be entitled to raise a complaint about the
matter with HUD and/or seek damages at the Tribunal. The legislation should prohibit reletting of a
property within six months of a tenant’s departure where a Notice was given for the property’s sale,
its use for non-residential purposes, or occupation by a family member. This would exclude a
situation where a bona fide purchaser of the property chooses to rent it out.

2.1.9 – Notice period for Tenants

As a comparison, the Victorian legislation requires tenants in a periodic tenancy agreement to give
28 days notice of intention to vacate (reduced to 14 days where the landlord has served a notice to
vacate themselves).

The Tasmanian legislation requires tenants in a periodic tenancy agreement to give 14 days notice of
intention to vacate.

The Scottish legislation requires tenants in a private tenancy agreement to give 28 days notice of
intention to vacate, unless the parties agree otherwise in writing.

This suggests that the present New Zealand legislation sits in the middle of similar jurisdictions.
Longer notice periods may cause complications for tenants by forcing them to pay out the remainder
of an existing tenancy while also having to secure and move into a new property by beginning to pay
rent immediately.

It is likely that, should the government’s wider measures alleviate the housing crisis, there may be a
change in the average length of time it takes a property to be re-let. One option under new
legislation may be to require tenants to give a “prescribed notice” which may be varied as
appropriate for time to time (for example, it may allow for a 21-day notice to become a 28-day
notice in the future).

2.1.12 – Impact of removing 90-day ‘no cause terminations’

As stated above at pages 2 and 3, I favour the removal of all ‘no cause’ terminations (including that
for fixed-term notices). Housing is a fundamental human right that should only be affected for a
prescribed reason. It is possible that some landlords who have previously relied on no-cause
terminations where there is valid cause to terminate the tenancy will need to prepare additional

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evidence and paperwork to serve a notice of termination and gain possession at VCAT if necessary (I
note that this class has in the past included public housing providers). I believe this is a manageable
trade-off in redressing the balance between tenants and landlords.

2.1.14 – Additional public housing termination grounds

The Victorian grounds set out in Table A above are an examples of the specific public housing
grounds to terminate. I would note that a ground for ‘drug-related conduct in public housing’
appears to duplicate the existing ground of termination where a tenant has used the premises for
unlawful activity.

Other grounds (such as eligibility for public housing changing) reflect wider questions of public
housing policy, such as whether public housing should be guaranteed for life or should serve
temporary need. Different social housing providers are likely to have different functions that may
guide this. I would advise that a specific ground for termination based on loss of eligibility not be
created lightly in the absence of clear departmental or organisational guidelines.

2.1.15 – ‘No cause’ terminations and fixed-term agreements

Ideally, fixed-term agreements would be arranged because both tenants and landlords wanted
relative certainty about their positions (secure housing without sale or another no-fault termination
for a fixed period of time for the tenant; guaranteed income for a period for the landlord). If they are
to remain in the legislation, fixed-term agreements should not be used as a residual opportunity to
evict with a no-cause notice.

I note again that the effect of the Victorian legislation is to sharply circumscribe the basis on which a
fixed-term agreement can end with a no-reason notice. The power to do so is only available for a
fixed agreement’s first term, and it can be challenged on the basis that it is retaliatory or
discriminatory. The Tribunal also holds the power to determine whether a possession order is
reasonable and proportionate in all the s.

2.1.17 – Option to extend a fixed-term agreement

It is worth comparing Option One to the status quo to determine what additional protections and
securities it offers:

At present:

- Landlords and tenants will enter into a fixed-term tenancy agreement;

- If the agreement reaches its end, the landlord presently has the right to terminate on a
range of either for-cause bases (landlord/family intend to move back in) or with a no-reason
notice. If the agreement lapses and becomes periodic, these remain available to the landlord
at any time;
- If the landlord wishes to enter a new fixed-term agreement for their certainty, they will
likely propose this to the tenant. This may continue until such a time as either the landlord
has a basis to terminate or the tenant wishes to leave.

As noted, Option One creates a potential unintended consequence of allowing minor or trivial issues
to be used as a basis to terminate an agreement (if it indeed makes renewal/extension/creation of a
periodic agreement conditional on a ‘clean record’ during a fixed term). It would not change a
situation in which the landlord may rely on specific termination provisions at a fixed tenancy’s end or
the tenant could choose to depart, and so does not address the ‘uncertainty’ the Discussion
Document describes. Those mutually convenient and satisfactory arrangements where parties may

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enter into ongoing fixed-term agreements would be unaffected, but not further incentivised. It
appears to be a cumbersome adaptation of what presently happens that would heighten confusion
and uncertainty, not lessen it.

2.1.18 – Specification of a minimum length for fixed-term agreements

Although there are many tenants who may prefer longer-term leases, I believe that the imposition of
a mandatory minimum term would create an imposition on both landlords and tenants. The example
given in the Discussion Document is apt, but legislation should be fit for purpose for students,
seasonal workers, workers in fixed-term arrangements, and other arrangements that reflect a
modern and mobile society.

I note Victoria’s current project to establish (non-mandatory) long-term lease agreements of more
than five years. It is hoped that this will create secure long-term tenancies for tenants who do need
that stability. Landlords and tenants interested in long-term leases will be connected through a
dedicated website, and a specialised intermediary service will manage long-term arrangements.
These long-term leases are likely to have varying duties and rights in terms of repairs and
modifications. This may warrant further scrutiny by HUD in terms of evaluating unmet tenant
interest in these leases, and the extent to which there would be buy-in from the private rental
market for an elective scheme.

2.1.19-2.1.22 – Workable periodic agreements

From the perspective of improving security and stability for tenants, I believe that Option 3
constitutes the best possible outcome of the three outlined. It is also a better alternative to a
counterfactual where periodic tenancies cannot be terminated without cause but fixed-term
tenancies can be.

One alternative is a market where neither fixed nor periodic agreements allow for no-cause
termination. This would mean that tenants and landlords still have the right to enter into fixed-term
agreements for added mutual certainty, but with a reduced threat to tenant stability and security at
a fixed term’s end (although they may face having to move out of the property through no fault of
their own, it would be the same situation they face in a periodic environment).

In the event of a pure Option 3, as noted at 2.1.9, the recently amended Scottish legislation allows
tenants and landlords to make written agreements for longer notice periods before a tenant
terminates. This may be an option that parties can take up to feel more secure in offering a periodic
agreement in terms of adequate notice that the agreement will be ending.

A pure Option 3 should also offer some initial protections for a tenant. These could include:

- Mandatory disclosure at an agreement’s start as to whether a landlord has any proposal or

engagement on foot to sell the property;
- Whether there are mortgagee actions on foot to recover the property;
- An additional statutory requirement or threshold during the first 12 months of an periodic
tenancy that a landlord may only give notice to sell/renovate/move into the property if they
can demonstrate severe hardship.

Landlord and Tenant Responsibilities

2.2.2, 2.2.5 Tenant Responsibilities

13

The existing requirements for tenant responsibilities are now well-established and well-understood.
I would submit that the only potentially contentious duty is the requirement not to allow more
people than the number specified on a tenancy agreement to reside on the premises.

Where a landlord is stipulating unreasonable restrictions on a property’s use (for example, no more
than two people allowed to reside in an established three-bedroom property) a tenant should have
a clear statutory pathway to seek a declaration from the Tribunal that this limit is not reasonable.

2.2.3 ‘Reasonably Clean and Tidy’ Standard

Reasonably clean and tidy is a standard that may entail different duties and responsibilities
depending on the nature of the property, its fixtures, amenities, and furnishings (if any). Case law
has also set out the sort of cleaning responsibilities that fall squarely within a tenant’s scope (clean
surfaces and floors, ovens and bathrooms) and ones that do not (cleaning and servicing chimneys or
heating ducts). It may be difficult to incorporate all these expectations into law.

It is common for rental agencies and property managers to provide additional explanatory material
about cleaning obligations at a tenancy’s end. Additionally, HUD may wish to provide clear and
visually demonstrative materials on responsibilities at an end of a tenancy, ideally in multiple
languages.

2.2.4 Additional Responsibilities for Long-Term Tenants

The kind of secure long-term tenancies that are common place in Western Europe in which tenants
may be able to live in properties for many years or even decades are infrequent in the Anglosphere.
Rents may be subject to stricter controls which mean they remain affordable to occupants, property
owners’ right to renovate, sell with vacant possession or move in may be heavily circumscribed, and
in some cases a right to occupy the property may pass on to a tenant’s family member automatically
on their death. It appears that the tenor of the present reforms is likely to be more moderate in
effect and will move the New Zealand level of protection closer to that of Victoria or Scotland than
Western Europe.

However, I summarise some of the additional responsibilities placed on tenants in Western Europe
below, while noting these responsibilities are taken on in a context of assured and lengthy tenancies.

Belgium: Tenants are responsible for repairs and day-to-day and routine maintenance, but landlords
are responsible for major repairs and maintenance. Examples of day-to-day maintenance include
door hinges, window locks and cupboards, as ill as minor tiling and plastering.

France: Tenants are subject to the Decree 87-712, a regulation that sets out a precise list of repair
costs that must be borne by the tenant. Examples include the replacement of
door/window/cupboard hinges, responsibility for upkeep of gardens and shrubs, and skirting boards
and joinery. Landlords remain responsible for repairs due to damages caused by construction
defects or unforeseen events or natural disasters, as ill as those concerning the structure or overall
strength of the building.

Germany: Minor maintenance works and cosmetic repairs will fall on the tenant. This may include
the painting and whitewashing of walls and ceilings, locks of doors and windows, and small damage
to equipment for utilities or cooking. 6

6
TENLAW, “My Rights as a Tenant In Europe”, December 2014 https://www.tenlaw.uni-
bremen.de/My%20Rights%20as%20Tenant%20in%20Europe.pdf

14

Overall, it appears that the main shift of responsibilities from landlord to tenant in true long-term
tenancies is around lower-level and cosmetic repairs and maintenance. Unless New Zealand’s
security of tenure is brought on par with that of Western European jurisdictions, I would advise
against such a significant transfer of liability/responsibility.

2.2.6 Repercussions for Long-Term Tenants

Compared to Victoria, New Zealand’s process to terminate a tenancy where a tenant is breaching
their obligations is very brief. I favour the ‘compliance order’ process introduced at 2.1.1 of this
response, where a landlord may issue a 14-day order to comply, seek a compliance order from the
Tribunal, and then issue a notice to terminate if the tenant breaches the Tribunal’s compliance
order.

This allows an earlier consideration of the merits of the dispute by the Tribunal and will allow
tenants a longer compliance timeframe where they struggle to comply promptly due to disability,
mental health, or being on a low income (a classic example of a compliance issue that may intersect
with all of these is hoarding behaviour

14-day grounds to terminate for unlawful acts such as illegal use of the property may still be
appropriate, but I recommend that this be confined to circumstances where illegal use has been
established by criminal proceedings.

With regard to exemplary damages, I note that that under the Residential Tenancies Amendment Bill
(No. 2) tenants will still be liable where they caused damage to a property, with a cap of four weeks.
I submit that this liability where an act or omission causes damage to the property will provide an
incentive for most tenants to promptly notify of damage.

2.2.7, 2.2.8, 2.2.10 Landlord Obligations

I believe that while the obligations set out for landlords in New Zealand are reasonably clear in their
wording, accessible educational publications and information will always have a reach that the
legislation itself does not. As with those materials for tenants, these should be in a range of
languages. There may be some benefit in letting agencies being required as a matter of regulation
and accreditation to provide a copy of these obligations to new clients.

As the Discussion Document goes on to note, landlords should not be able to refuse reasonable
requests for minor modifications or pets.

2.2.9 Landlord’s Repair and Maintenance Obligation;

The exact wording of section 45(1)(b) of the Residential Tenancies Act 1986 says that a landlord
shall:

“provide and maintain the premises in a reasonable state of repair having regard to the age
and character of the premises and the period during which the premises are likely to remain
habitable and available for residential purposes”

While the first portion of the clause seems relatively unambiguous, I believe the second is
troublesome. Interpreted a certain way, it appears to give landlords leeway to ‘run a property down’
– that is, letting the property fall into a dilapidated state on the basis that some kind of
redevelopment or renovation is intended for some indefinite point in the future.

15

The new Victorian legislation’s duty reads as follows:

“A residential rental provider must ensure that the rented premises are provided and
maintained -

(a) In good repair; and

(b) In a reasonably fit and suitable condition for occupation.

(1A) Subsection (1) applies –

(a) Whether or not the tenant was aware of any disrepair at the rented premises before
entering into occupation of the premises; and
(b) Despite the amount of rent paid by the tenant; and
(c) Despite the age and character of the premises.

MY interpretation of the new repair duty under Victorian law is that it creates an affirmative
baseline standard that property should be irrespective of its price or age. The phrase “reasonably fit”
by its nature is likely to allow for some interpretative flexibility in terms of what amounts to being
suitable to occupation, but would not allow for a landlord to not address repairs for some time and
then point to the property’s age or character as a basis to excuse remediation works.

The Victorian wording exists alongside the implementation of new rental minimum standards
(analogous to the Healthy Homes Guarantee Act 2017).

I would recommend that for clarity’s sake, New Zealand legislation adopt a definition of a landlord’s
obligation to keep in good repair similar to that in the new Victorian legislation.

2.2.12 – Shared Responsibility for Heating Equipment/Ventilation Methods/Other

Improvements

I would observe a distinction between imposing safety-related duties on a tenant (the most obvious
of which is to change batteries in smoke alarms as needed) and imposing maintenance-related
duties related to heating and ventilation equipment/methods. In particular, the safety-related duties
in the former instance involve user-friendly equipment (no particular expertise needed) and a fixed,
low cost.

Of particular concern is that some works, particularly those involving gas heaters, may only be
carried out by an authorised tradesperson. This means that attributing the costs of maintenance to a
tenant for heating or ventilation could become prohibitively expensive. Additionally, transferring
responsibilities for maintenance work that may be covered under a landlord/appliance purchaser’s
warranty may be counterintuitive.

As noted at 2.2.4 above, explicitly transferring these responsibilities to tenants makes sense in the
context of long-term, Western European-style rental agreements.

I would note that the duty to refrain from intentionally or carelessly damaging the premises and the
duty to keep a property reasonably clean may, by extension, include duties with respect to heating,
ventilation and drainage. This could be implied to create a responsibility not to obstruct or tamper
with the devices or equipment, and to take basic steps like remove external dust or grime that
affects the equipment’s performance (short of disassembly).

16

 2.2.13 – Obligation to Use Improvements

I note the Discussion Document’s distinction between the more expensive operating costs of a
device such as a heater and other standards that cost less to run, an extractor fan being the most
obvious example.

I oppose the imposition of an additional general duty that mandates that tenants use an
improvement. As noted above, tenants are already obliged within their powers to refrain from
intentionally or carelessly damaging the premises and keep the property reasonably clean. It strikes
me that appropriate and cost-effective use of heating and ventilation improvements is part of
complying with this duty, particularly where an area such as a bathroom or kitchen has ventilation
installed, and that imposing an additional obligation would be redundant.

Modification to Rental Properties

2.3.3 – Responsibility for Reversing Modifications

I anticipate that in most situations, modifications would be able to be resolved between tenants and
landlords. It is unlikely, for example, that a tenant would arrange the modification at their own cost
such as access to telecommunications services (like a phone point) and that the landlord would then
seek to remove this or force the tenant to do so.

However, in the same way that it is theoretically possible that a tenant may undertake inappropriate
modifications without consent, it is theoretically possible that a landlord may make unreasonable
demands to remove professionally-installed amenities that add value to the property.

I would recommend that a landlord have an ability to apply to the Tenancy Tribunal to meet any
reasonable costs of reversing a modification they have made, but that there not be an automatic
presumption at the Tribunal stage that the landlord is entitled to have all previously permitted
modifications reversed. There should be a requirement that any modification the landlord seeks to
have reversed or rectified is reasonable and proportionate in all the circumstances.

2.3.4 – Making non-reversal an unlawful act

It is important to distinguish between circumstances where a tenant won’t reverse a modification to

a tenancy at the tenancy’s end, and circumstances where a tenant can’t reverse a modification.
Generally, the latter would involve situations where a tenant cannot immediately reverse the
modification themselves because of cost or incapacity. This would not prevent the landlord from
obtaining judgment for the cost of rectifications at the Tribunal and (for example) entering into an
arrangement to have this repaid by the tenant in instalments.

With these protections under the legislation in mind, I oppose making failure to reverse a
modification an unlawful act.

2.3.5 – Reasonable grounds to object to minor modifications

The new Victorian legislation allows the following grounds on which landlord can say no to minor
modifications:

17

 - Where a Notice to Vacate has been given for an upcoming change in use, ownership or
possession of the premises;
- Where a modification would significantly change the premises, or require modifications to
other premises;
- Where a modification would be in breach of another Act or law (i.e., the NZ Building Act
2004);
- It will not be reasonably practicable to reverse the modification if needed;
- The modification would entail additional maintenance costs for the landlord after the
tenancy ends.

The present Scottish legislation allows private tenants to reach additional agreements with their
landlords on modifications, but landlords cannot be compelled to agree to reasonable modifications.
Those Scottish tenants classified as “secure tenants” (who rent from councils, housing associations,
or co-operatives) have the right to make alterations subject to regulatory requirements as to how
these are carried out, and consent cannot be unreasonably withheld.

I believe that the above example of grounds of refusal from the Victorian legislation is an
appropriate list to base a change in the NZ legislation on.

2.3.6 – 21-day timeframe for refusal

I agree with the proposal of a 21-day window to give (or refuse) consent to reasonable modifications
to a property.

2.3.7 – Requirement for suitably qualified tradesperson

I agree with the proposal that certain modifications should be completed by a suitably qualified
tradesperson (while noting that in some circumstances, that may in fact be the tenant themselves or
another household occupant).

Appropriate modifications to require a qualified technician or tradesperson would be:

- Modifications to allow for the installation of telecommunications services;

- Modifications to allow for disability access;
- Modifications that would, in any event, be unlawful if not carried by a registered
tradesperson.

2.3.8 – Modifications That Can Be Made Without Permission

I am strongly in favour of a list of alterations being produced as part of the amendments which:

- A tenant can make without seeking permission, or that;

- Are a non-exhaustive list of alterations it would be ordinarily be unreasonable for the
landlord to refuse.

The Victorian legislation has introduced the following list of modifications a landlord may not
unreasonably refuse:

- Modifications that do not penetrate or permanently modify surfaces, fixtures or the

building’s structure;

18

 - That are required for health and safety purposes;
- That are reasonable alterations under disability discrimination legislation and are assessed
by an accredited occupational therapist or prescribed practitioner;
- That ensure access to telecommunications services;
- That are reasonable security measures;
- That are necessary to ensure the safety of a person who is being subjected to family violence
and/or is protected under a protection/restraining order;
- That are necessary to increase thermal comfort or reduce energy and water usage costs;
- That are other prescribed modifications.

The Victorian legislation also proposes to introduce a list of prescribed modifications that can be
made without a landlord’s consent. It is unclear whether this will duplicate items in the list above or
involve additional modifications.

My opinion is that the following modifications should be able to be made without a landlord’s
consent:

- Modifications that do not penetrate or permanently modify surfaces. An obvious example is

the use of adhesive stickers or strips to put up pictures, mirrors or photos. These would save
convoluted processes where a tenant has to seek permission for each occasion where
something may be placed on a wall or surface.
- Security modifications that are necessary to ensure a person’s safety in family or personal
violence situations. A tenant should not have to unnecessarily divulge to a landlord or
landlord’s representative that they are experiencing or escaping family violence. Having to
seek consent for reasonable minor safety modifications would run counter to this.

2.3.9, 2.3.10 – Suitability of Options

As indicated, I believe the two options described could co-exist – a primary set of modification rights
that are appropriate to allow without owner consent, and a secondary set of modification rights that
cannot be unreasonably refused within a 21-day period.

I again stress the importance of the Tribunal having discretion over a tenant’s liability for reversal of
modifications subject to an overall reasonableness and proportionality test, and my view that this is
not an appropriate area in which to expose tenants to any financial penalty for an unlawful act.

Pets in Rental Properties

2.4.1 – Refusal to keep pets without a reason

A unilateral right from a landlord’s perspective to refuse pets appears to be an arbitrary measure of
control that does not reflect the modern renting environment, in which landlords offer a service in a
private commercial market. Though in some cases there may be personal and ongoing connections
to the premises, in others the property is an investment rather than a place the landlord themselves
would live in and exercise personal preference over.

As noted, many households have pets, and these animals are often a meaningful source of
emotional support and company. My view is that prospective tenants should not be lightly forced
into a choice between insecure housing and/or homelessness and surrendering an animal.

19

 2.4.5 – Reasonable Grounds to Refuse A Pet

The amended Victorian’s legislation made high-profile changes which appear broadly similar to
Option Two of the Discussion Document. A tenant can challenge a landlord’s request if they consider
it unreasonable by seeking a declaration at the Tribunal. The Tribunal may assess whether consent
has been unreasonably refused having mind to the following:

- The type of pet the tenant proposes to keep, or is keeping, on the rented premises;
- The character and nature of the rented premises and any appliances, fixtures or fittings;
- Whether refusing consent to keep the pet on the rented premises is permitted under any
Act or regulation;
- Any other matter the Tribunal considers relevant.

In essence, the grounds are very similar to the specifications proposed in Option One.

Interestingly, while Scottish tenancy legislation is silent on pets, there are indications that under the
Consumer Rights Act 2015 a "no pets” clause would be considered unlawful in the UK (and the
European Union) unless modified by a clause that the landlord’s consent may not be unreasonably
withheld.7

I believe that codifying bases on which refusing a pet will be unreasonable in law is sensible whether
Option One is applied, or in the case of Option Two, as a set of considerations the Tribunal should
direct its attention to when consent is argued to be unreasonably withheld. While both options are
an improvement, Option One may be more effective in unambiguously setting out the rights of both
tenants and landlords.

2.4.6 – Proving Good Reasons To Keep Pet

Requiring tenants to offer evidence for why they ire good pet owners to the satisfaction of landlords
appears to be a cumbersome and potentially unworkable solution. The example given of the
Wellington City Council’s RDO accreditation is currently region-limited, and is an example for only
one kind of animal. It is likely that it would disadvantage prospective first-time pet owners who have
no ‘track record’ of responsible pet ownership. Nor, would i note, is being legally compliant in all
other regards as a pet owner a guarantee that pet damage would be avoided. I would oppose this
measure.

2.4.7 – Specific attributes and pets

It is difficult to exhaustively account for all the potential situations in which premises may be
inappropriate for a kind of pet. Independently of the preferences of both tenant and landlord, the
animal’s welfare is likely to be a decisive consideration, including risks to itself and others in the case
of its escape from premises (i.e., not keeping a dog in an unfenced property). From the perspective
of welfare, size of the premises may also be a factor (e.g., a large dog breed such as a Great Dane is a
small one-bedroom apartment that is not on a ground floor).

2.4.8 – Pet Bonds/Additional Deposits

7
https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/616956/
oft356.pdf

20

I strongly oppose the imposition of an additional financial surcharge on households who wish to
keep a pet. One in five New Zealanders have no money at all set aside for emergencies (such as an
unexpected move) and nearly half have less than $1000 in savings8. New Zealand tenants are
required to pay their first instalment of rent and a bond on moving into a new property. Additional
costs could prove destabilising at the time of starting a new tenancy agreement.

For families moving in situations of domestic violence, retaining pets is important for both emotional
support and a sense of security. Additional barriers (such as a deposit) to fleeing domestic violence
may mean that women remain in violent situations in order to ensure an animal’s wellbeing.9

The effect of additional bonds or deposits for pets is to create a two-tier standard for tenants – the
affluent and fortunate who can pay a premium for an animal companion, and the not-so-fortunate
who cannot.

2.4.9 – Additional Obligations for Pet Owner Tenants in the Residential Tenancies Act

I refer to my answer at 2.1.2 above. It is unclear why ongoing irresponsible behaviour as a pet owner
would not amount to a nuisance of the kind a tenant is presently obliged not to cause or permit
under section 40(2)(c) of the current Residential Tenancies Act. The obligation not to interfere with
the reasonable peace, comfort and privacy of others is a broad one with no indication that it
presently ‘carves out’ animal control matters, other than to the extent that these are covered by
other law.

Rents and Rental Bidding

3.1.2 – Controlling Rental Bidding

Coverage of rental bidding in recent months (particularly at the beginning of 2018 in the Wellington
region) indicated that it is far more common for these negotiations to favour landlords than tenants.
Inviting bidding may distort market rents as tenants who have the means to do so name a price ill
clear of competitors to secure a property quickly, rather than one that reflects the market rent for
the property’s condition, amenities and convenience. Outside of a confined market perspective,
rental bidding is another way in which key waged and unwaged participants in a local community
may be driven away from where they have previously lived, laboured and studied, affecting the
community’s cohesion overall.10

As the report notes, the new Victorian legislation is prohibiting landlords and property managers
from soliciting rental bids. Tasmania’s tenancy laws also prohibit the listing of premises for rent
without a fixed price or the solicitation of rental bids.

8
BNZ, “Rainy days and rocky futures: it’s time for Kiwis to change their attitude”. Media release, 7 December
2017.
https://www.bnz.co.nz/about-us/media/2017/rainy-days-and-rocky-futures-its-time-for-kiwis-to-change-
their-attitude
9
NZ Family Violence Clearinghouse, “Research underlines strong link between animal cruelty and family
violence in New Zealand”, 28 March 2012
https://nzfvc.org.nz/news/research-underlines-strong-link-betien-animal-cruelty-and-family-violence-new-
zealand
10
For example a 2013 RMIT study of Melbourne’s gentrifying Northern suburbs indicated the trend of rising
house prices disproportionately affect culturally diverse communitiesL
http://mams.rmit.edu.au/h6c2t2nxugey.pdf

21

 3.1.3 – Rental Bidding – Options One and Two

I have previously indicated misgivings about prohibiting rent-bidding through attaching financial
penalties to either accepting a bid or asking a tenant to name a price11. Enforcement will be
expensive and time-consuming, and generally relies on a tenant reporting the unlawful conduct at
the risk of losing their opportunity to successfully apply for the advertised property.

I continue to hold the position that effective rental bidding legislation should involve the following
components:

- A requirement that any advertised property be listed with a fixed price;

- A stipulation that any rent charged in excess of the advertised price is invalid, unless raised
over time under the lawful provisions of the Act;
- A right for tenants and landlords to apply to the Tribunal for a declaration where a dispute
arises about this.

Rather than attempting to stamp out rental bidding on a case-by-case basis, this neutralises its
effect.

Per paragraph 154 of the Discussion Document, I would note that absent rental bidding landlords
and their agents have multiple sources to determine market rent at any given time, including:

- Number of applications received for properties in the area;

- Number of attendees at open-for-inspections;
- How long the property is listed prior to being listed.

3.2.1 – Application for Rent Adjustment

The right to apply to the Tribunal to consider the appropriateness of the rent the landlord has set is
an important one, though it is correct that gathering information to do so from the tenants’
perspective may be time-consuming and difficult to do within three months of a rent review. I would
welcome an extension of deadline to four months.

A separate consideration beyond the ambit of the Discussion Document is the extent to which the
government’s support of tenancy advocacy and tenancy law in community legal centres and tenants’
unions would assist tenants who would otherwise face barriers to doing so apply to the Tribunal in a
timely fashion. It may be that if assistance and representation from a professional service was
readily available, tenants could indeed comply with a three-month deadline.

3.2.2 – An increase ‘substantially exceeding market rent’

The Australian Capital Territory has set out a guideline for what may be defined as excessive as
follows:

“unless the lessor satisfies [the Tribunal] otherwise, a rental rate increase is excessive if it is more
than 20% greater than any increase in the index number over the period since the last rental rate
increase or since the beginning of the lease (whichever is later)”

11
Nunweek, J., “Speculators hate him! One weird trick to end rental bidding wars”, 28 February 2018
https://thespinoff.co.nz/society/28-02-2018/speculators-hate-him-one-iird-trick-to-end-rental-bidding-wars/

22

The “index number” in this instance means the rents component of the housing group of the
Consumer Price Index for Canberra published time to time by the Australian statistician.

I suggest that a threshold of 20% greater than the increase in the housing rentals index for a given
region of NZ may be an appropriate way to determine if a rent increase is excessive.

3.3.2 – Rent Increases Once Every 12 months

Limiting rent increases to once every 12 months would bring New Zealand into line with Victoria’s
new rental laws, Tasmania’s laws, and Scotland’s. I acknowledge the important ramifications this has
for tenants in terms of security and stability of tenure, as highlighted in the Discussion Document.

Although I remain sceptical of a suggestion that landlords and property managers will not be able to
correctly reflect changes to their cost structures in a timely manner, it is possible, as the Document
identifies, that higher rents may be demanded at the beginning of a tenancy. In a wider context,
however, the artificial inflation of the cost of rental housing due to serious scarcity should be
alleviated by a sustained commitment to the construction of new social and first-buyer housing. The
possibility for some variation in rents in the context of residential tenancy law changes ought not to
be considered in a policy vacuum.

3.3.3 – Disclosing How Rent Will Be Calculated

I support introducing some requirement that offers greater ability to plan and added transparency
for landlords and tenants in terms of how rent will increase.

The Discussion Document’s concerns about the burden on landlords or lack of flexibility are noted.
The new Victorian legislation sets the requirement for a landlord to explain how rent increases have
been calculated at the time a notice of rent increase is sent rather than in the tenancy agreement
itself. This may offer flexibility for where rises are affected by an event such as significant
improvements to the property (as distinct from repairs).

As regards public housing, I would note that the methods and policies on which income-reduced rent
is calculated remain relatively clear and predictable, even if incomes fluctuate.

Boarding Houses

4.1.1 - Obligations in Boarding Houses

I believe that the present balance between boarding house residents and operators is fit for
purpose, but the amount of advocacy and support available for this vulnerable class of tenants is
very limited. To ensure they meet their obligations and can pressure operators to meet theirs, it is
essential that there are outreach services residents can access.

I also have concerns about the short periods of notice boarding house residents have compared to
tenants in tenancy agreements. The former can receive no reason termination notices of only 28
days, compared to 120 days in Victoria. In Tasmania, boarding house residency terminations are
subject to the same grounds as tenancies (including the lack of a no-reason notice to terminate a
periodic agreement). As people who are asked to leave rooming houses are more likely to face
homelessness, there should be longer grace periods in matters that do not involve residents acting
violently or putting other residents in danger.

23

 4.1.3 – Enforcement powers for rooming house standards

MY view is that effective oversight of rooming houses comes from a combination of the following:

Information Sharing and Central Registers: HUD and local authorities should have clear processes
available in terms of who does what, with the capacity to pass on information about relevant
systemic issues. Authorities (and residents) should be able to access a central register of boarding
houses and licensed boarding house operators.

Outreach and Advocacy for Boarding House Residents: If there are free, timely and accessible
advocacy services (including outreach workers) residents will be empowered to come forward. This
may also bring to light informal or unregistered boarding house arrangements.

Tiers of Compliance and Enforcement: The Discussion Document correctly intimates that a zero-
tolerance policy for non-compliant operators and premises may lead to making a lot of highly
vulnerable people suddenly homeless. Where appropriate, the focus should be on timelines to
comply with clear guidance from authorities. If a participant in the sector is set on continuing to act
in an exploitative way, information sharing is once again important. The shutting down of a rooming
house should be done in tandem with emergency housing providers who have been brought into the
loop to engage with residents ill in advance.

4.1.4-4.1.7 – Self-certification option

As set out in the Discussion Document, I see a low chance of the disadvantages outlined at para. 192
and 193 occurring, but a high chance of that at para. 194 occurring: that some reputable participants
in the sector comply (for example, boarding houses operated by a social housing provider, a church,
or a refuge organisation, or ill-established private landlords/premises) and that other operators
continue to fly under the radar. Self-certification will likely merely ensure the compliance of those
model operators who would have complied anyway, while not resolving the situation for the most
vulnerable residents.

4.1.8-4.1.11 – Warrant of Fitness Option

MY preference is the warrant of fitness option, which if implemented would bring New Zealand onto
a similar footing to Victoria, Australia.

For residents if for no one else is important that such a scheme involve:

Proportionality – Non-registered and non-compliant providers are monitored and educated to

improve in the first instance before escalating to fines/closure/prosecution

Affordability –If a fee for processing applications is to be introduced, it should not be more than
what is needed to make the licensing scheme feasible. Subsequent renewal of registration fees for
participants who remain in the market could operate at discounted rates.

Flexibility – Documents for long-term operational considerations like cyclical maintenance should
not be a prescribed form, but there should be clear plain-English questions that
operators/prospective operators are directed to answer.

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In saying this, I believe a fit and proper person assessment of those operating, or delegated to
manage a rooming house is essential. Minor offending should be grounds for an individual to be
refused a license, but serious dishonesty offences or offences involving violence or health and safety
violations should preclude registration.

As noted above at 4.1.3, it would be beneficial for central and local government to gain a clear sense
of how capacity for enforcement of a Warrant of Fitness should be shared.

4.1.12, 4.1.13 – Defining Rooming Houses

I believe that the legislation should aim to catch as many room-by-room tenancies as possible in
which accommodation is being provided as a matter of a consumer-trader relationship (as opposed
to a licensee situation, involving a lodger or homestay).

Currently, the Victorian threshold for the definition of a boarding/rooming house is premises in
which one or more rooms are available for occupation on payment of rent, and the number of
people occupying those rooms are at least four. I believe this lower threshold will allow the
legislation to capture (for example) the practice of letting out premises to international student and
working holiday visa holders as a room (or a bed within a room). In such cases, four individuals may
rent across two bedrooms. This situation would not currently incur the boarding house jurisdiction in
New Zealand, and is likely not an apt fit for the ordinary tenancy portion of the Residential Tenancies
Act 1986.

Although these arrangements may not resemble traditional rooming houses, the lower threshold
would mean that NZ is keeping abreast of changes in the rental and long-term accommodation
sector. Despite being a different model of rooming right with communal facilities, I would suggest
that occupants in these contexts are entitled to a clear framework of rights, responsibilities and
standards.

Enforcement

5.1.4, 5.1.5 – Power of Entry Into Rooming Houses

I consider it appropriate for HUD to be able to exercise a unilateral power to enter common spaces
of rooming houses without prior agreement of at least one occupant.

For “spot checks”, this could involve a 48 hour notice. If HUD believes on reasonable grounds that a
serious breach of the law or standards is occurring that creates a risk to occupants they should have
the ability to enter the common areas without notice.

5.1.6 – Power of audit

In practice, HUD are likely to exercise any power of audit in a similar manner to equivalent agencies
overseas such as Consumer Affairs Victoria – sparingly but where behaviours are serious, ongoing,
and systemic. Practices that could justify an audit may include the failure to lodge bonds, or (in the
case of a property manager) misconduct involving rent that is paid into a trust account. I support this
additional power.

5.1.7, 5.1.8 – Single Case for Multiple Breaches

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It is counter-intuitive that HUD, as a well-resourced agency that brings litigation to the Tribunal as a
matter of public interest, should be required to file separate applications on a tenancy-by-tenancy
basis. I support its ability to take a single case in respect of multiple breaches. I suggest that HUD be
seeking penalties of at least $6,000 when doing so.

5.1.9 – 5.1.14 – Enforceable Undertakings, Infringement Notices and Improvement Notices

The combination of the above measures (as set out in the Discussion Document’s case study at para
255) appears to be a useful and effective way of HUD address minor offending under the Act and
(where appropriate) offer landlords opportunities to improve or correct issues.

I note that the case study appears to envisage the issuance of infringement notices in matters that
are likely to be easily proved such as failure to provide a tenancy agreement, failure to lodge a bond,
or charging prohibited fees. It may that where a landlord is new to the sector, the jurisdiction, or is
otherwise a first-time offender an improvement notice alone would be more appropriate.
Infringement notices may be most effective when they are issued to landlords who clearly
understand their obligations and have had these communicated to them, but choose to disregard
them.

Situations which have a serious impact on tenant welfare (forced evictions, harassment and
intimidation, discriminatory practices) will be more factually and legally complex and will continue to
be the more appropriate matters to take to the Tribunal.

If HUD is to offer leniency when dealing with initial small breaches by way of enforceable
undertakings or improvement notices, it is crucial that its recordkeeping in these matters be reliable
and effective. This means, for example, that it should be easy to cross-reference a tenant or tenants’
service complaint about a landlord with existing interventions and actions HUD has taken in the
matter. The risk otherwise is that repeat offenders are not captured.

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Appendix: Family Violence in the Residential Tenancy Law Context

The Discussion Document does not delve into additional protections in the Residential Tenancies Act
1986 for victims and survivors of domestic violence, who in New Zealand are overwhelmingly
women and children.

I note that the new Victorian legislation features a range of additional protections to endure that
these survivors can:

- Make themselves safe in their homes;

- End or reconstitute fixed-term agreements easily through the Tribunal in cases of domestic
violence;
- Avoid being evicted due to the violent acts of a perpetrator that are also grounds for
termination of a tenancy agreement.

In Aotearoa New Zealand, these powers could exist alongside the current capacity of the Family
Court and District Court to make tenancy orders under sections 56-59 of the Domestic Violence Act
1995.

Context

The Victorian government launched a Royal Commission into Family Violence in February 2015. The
Commission was tasked with finding solutions to:

- prevent family violence;

- better support victim survivors;
- make perpetrators accountable.

The commission received nearly 1000 written submissions and held 25 days of public hearings. It
released its report in March 2016, with 227 recommendations that the Victorian government
immediately accepted and pledged to undertake, a number of which related to tenancy. Changes
pertaining to the private rental market have now been incorporated into the Residential Tenancies
Amendment Act 2018. Key changes include the following:

Locks & Modifications

Victoria provides that where a tenant has been excluded from property under a domestic violence
order (either temporary or final), a protected person under that order who is still residing in the
premises may change any external door or window lock without obtaining agreement first. The
person who has changed the lock(s) must supply a copy of the new key(s) to the landlord or their
agent as soon as possible. The landlord is prohibited from giving a copy of any new key(s) to the
excluded person.

If a similar provision ire introduced in New Zealand law, it would modify the current application of
section 46 of the Residential Tenancies Act 1986.

Victoria does not allow landlords to unreasonably refuse modifications to a property where these
are needed to ensure the safety of a protected person under a domestic violence order (i.e.,
additional safety locks, setting up an external security camera).

Early Termination of Fixed-Term Agreement

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Victoria provides that domestic violence (including a temporary order, not necessarily against a
person previously residing in the property) is grounds for a tenant to establish unforseen and severe
hardship and apply to the Tribunal for a declaration that a tenancy agreement may terminate earlier
than the end of the fixed term. The legislation is clear that in situations where domestic violence is
involved the protected person cannot be ruled liable for break lease costs.

This assists tenants where remaining at an address known to the perpetrator of family violence is no
longer safe, and also where relationship breakdown means the remaining person cannot sustain the
tenancy easily by themselves.

Creation of New Tenancy Agreement for Protected Person

Where a person responsible for domestic violence has been excluded from the property (including
an interim order), a protected person who is still living in the property can apply to the Tribunal to
create a new agreement either in their name only or with another party. The Tribunal may hear from
the landlord and the excluded person is also entitled to attend the hearing. However, if satisfied that
the protected person could reasonably be expected to comply with their duties as a tenant, the
Tribunal will make an order terminating the existing agreement and creating a new agreement with
the protected person as tenant.

When it is terminating a tenancy agreement early or creating a new tenancy agreement, the Tribunal
may also make ancillary orders regarding any rent arrears or damages at the tenancy’s end. Victorian
legislation makes it clear these can be apportioned between the tenants. For an example of how this
might work in NZ:

Leonie lived with Wesley in a rental in Sydenham. They are both on the tenancy agreement During
the last month of the tenancy, Wesley withheld his rent from Leonie and said that she would only
get it if she cleaned the house more and lost weight. They fall 14 days into arrears as a result.
Wesley also got drunk and angry and punched a hole in the kitchen wall next to Leonie’s head.

Leonie goes to court and gets a protection order excluding Wesley from the house. She then goes
to the Tenancy Tribunal and seeks orders that:

- Wesley is taken off the agreement

- Her oldest daughter Sam who is 19 and works fulltime be added as a co-tenant

The Tribunal is satisfied that Leonie and Sam could meet the requirements as co-tenants and
orders that the agreement with Wesley and Leonie will terminate effective immediately. The
Tribunal accepts on the evidence that Wesley caused the 14 days rent arrears and the hole in the
kitchen wall and declares that he is solely liable for these costs.

Possession Orders and Domestic Violence

Previously, the Victorian legislation made no distinction between co-tenants in cases where rent is
being terminated for assault or violence, nuisance, malicious damage, or illegal use of the property.

The Victorian legislation states that a Notice to Vacate will be of no effect where the conduct arose
in the course of a perpetrator carrying out acts of domestic violence. I would recommend that NZ
legislation also gives the Tribunal to determine the existing tenancy in these cases and remove a
perpetrator from the lease where they have been excluded from or otherwise vacated the property.

Lastly, the Tribunal has an overall discretion in deciding whether or not a possession order is
reasonable and proportionate in all the circumstances to consider the extent to which the reasons

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that the landlord seeks to terminate the tenancy arose out of family violence, and the extent to
which persons who ire not the tenant ire responsible.

An example of how this may apply in NZ:

Rita’s adult son Sid moves in with her after being kicked out of his boarding house. He is not
named on the tenancy agreement. Sid’s behaviour is very poor, and his repeated conduct includes
yelling and swearing at Rita, playing music very loudly at all hours of the day, and saying
intimidating things to neighbours. Rita receives a notice from the landlord to fix the nuisance
within 14 days. She explains the risks to Sid, but he says he does not care. The landlord applies to
the Tribunal to terminate the tenancy.

Rita gets help from a community legal centre and a counselling service to understand that what
Sid is doing is elder abuse and domestic violence, and applies for an interim order against Sid with
exclusion from the property. The Tribunal is satisfied that because the behaviour was not Rita’s, it
was the product of domestic violence, and steps are underway to remedy the breach of her
obligations/the tenancy agreement, no order terminating the tenancy should be made,

Tenant and Tenant Databases/Blacklists

Australian states and territories have detailed harmonised legislation about how personal
information about tenants is to be shared in publicly accessible databases. The Victorian legislation
introduces further protections for victim survivors and stipulates that where a tenancy was
terminated or a debt incurred in relation to domestic violence, the person who was subjected to the
domestic violence must not have their details shared. A breach of these requirements is punishable
by financial penalties.

I note that there are not presently specific laws pertaining to privately-operated residential
tenancies databases, and that this is a area that needs attention and development. However, in the
first instance there should be guidelines that victims of domestic violence have their details redacted
in all publicly available and searchable decisions of the Tribunal. Protecting survivors should be a
priority of any regulation introduced to the private database sector.

Conclusion

In this term of government, New Zealand has shown a commendable recognition of the way that
domestic violence permeates all areas of life outside of the relationship itself, most prominently by
passing law to offer paid domestic violence leave to victims and survivors in the workplace and by
establishing a yet-to-be-named “joint venture” across the public service to co-ordinate a national
strategy across agencies for how domestic violence is dealt with. At a resourcing level, a much-
needed boost to family violence social services was delivered in the May 2018 Budget.

I strongly believe that amendments such as the Victorian legislative changes canvassed above are
crucial if amended residential tenancy law is going to remain fit for purpose to deal with New
Zealand’s current rates of family violence. These changes in themselves are inexpensive, while
promoting the autonomy, dignity and safety of women and children. Addressing domestic violence
in this round of reforms may avoid having to return to the issue in the short-to-medium term, in light
of the government’s likely co-ordinated approach over the next 6-9 years.

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