New Zealand Law Society - Property firm ordered to pay $7,500 in quake-hit building case

Property firm ordered to pay $7,500 in quake-hit building case

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The Tenancy Tribunal has ordered Prime Property Group Ltd to pay back $6,900 of rent and exemplary damages of $600, after an investigation by the Ministry of Business, Innovation and Employment (MBIE) into their ruined property at 61 Molesworth St in Wellington.

The nine-storey building was badly damaged in the Kaikoura earthquake last November, and has since been torn down.

“MBIE’s Tenancy Compliance & Investigations Team immediately began investigating the property given its known use as a commercial premises, and discovered a family had been living there since June 2016,” says National Manager Tenancy Compliance & Investigations Steve Watson.

In its application to the Tribunal in March 2017, MBIE sought an order on behalf of the tenant against Prime Property Group Ltd, stating the tenancy was prohibited under the Act because the building could not lawfully be used for residential purposes.

“Regardless of the landlord’s intentions, charging $300 a week to live in an office space is unlawful. It is a prime example of taking advantage of someone who is in a vulnerable position,” says Mr Watson.

“The exemplary damages cost reflects the extent of the health and safety risks faced by the tenants, and the fact that the landlord should have known better.

“This decision sends a strong message to landlords that the penalties are high if you are caught renting commercial property to tenants.”

Due to the building’s earth-quake prone status, investigators could not enter to establish whether the Landlord was compliant with the smoke alarm requirements that became law on 1 July 2016.

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