Landlord Fails to Notify Tenants About Sale; Tribunal Awards Damages

OUTCOME: Allowed

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[2026] NZTT 5421203

TENANCY TRIBUNAL AT REMOTE LOCATION | TE TARAIPIUNARA RETIHANGA

APPLICANT: [redacted]

Tenant

RESPONDENT: [redacted]

Landlord

TENANCY ADDRESS: [ADDRESS], Luggate, RD 3, Wanaka 9383

ORDER

1. [RESPONDENT] must pay [APPELLANT] and [NAME] $3,828.00 immediately, calculated as shown in the table below.

Description Landlord Tenant Exemplary damages $1,800.00 Compensation $2,000.00 Filing fee reimbursement $28.00 Total award $3,828.00 Total payable by Landlord to Tenant $3,828.00

Reasons:

1. Ms [APPELLANT] attended the hearing for the tenants. The landlord notified the Tribunal that she would not be attending the hearing.

2. The tenants claim compensation and exemplary damages for the landlord’s failure to inform them that the premises were being marketed for sale.

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Relevant Law

3. Under section 47 of the Residential Tenancies Act 1986 (the Act), a landlord must give written notice to the tenants immediately if the premises are placed on the market. A landlord must also advise any prospective tenants if the premises are on the market.

4. Breaching any of these obligations without a reasonable excuse is an unlawful act for which exemplary damages may be awarded up to a maximum of $1800.00.

5. Where a party has committed an unlawful act intentionally, the Tribunal may award exemplary damages where it is satisfied it would be just to do so, having regard to the party’s intent, the effect of the unlawful act, the interests of the other party, and the public interest.

6. The Tribunal may award compensation to a party affected by the other party’s breach of the Act or of the tenancy agreement. Compensation can be awarded for upset, inconvenience and disappointment as well as for monetary loss or expense.

Background

7. The landlord granted a tenancy to the tenants in October 2024. The written agreement was for a fixed term from 1 November 2024 to 31 October 2025.

8. As the end of the fixed term approached, the tenants asked the landlord if she would be willing to extend it. The parties exchanged emails, and the tenants sent the landlord a short form of agreement extending the tenancy for another year. By October, the landlord had agreed to sign the agreement and return it to the tenants. She failed to do so.

9. On 4 November, the landlord telephoned the tenants and told them that the premises had been sold and that they could obtain further information from the selling agent.

10. The tenants met with the agent who informed them that the agreement for sale went unconditional on 14 October and that settlement would take place on 14 November.

11. The tenants were due to leave of a long planned six-week overseas trip on 18 November and so these revelations put them in an extremely difficult situation. They believed that their tenancy had been extended but they were being told that the new owners were expecting to take possession of the premises on 14 November. After some discussion, they agreed to vacate the premises on 14 November.

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12. Plainly, the landlord knew well before 4 November that she intended selling the premises. The evidence suggests that the premises were being marketed for sale or that there was a conditional sale and purchase agreement before the parties signed the tenancy agreement in October 2024.

13. Shortly before the tenants were due to leave on their trip, they were required to pack up and move out of the premises, store their belongings and arrange for other accommodation for when they returned to New Zealand. They found short term accommodation for three weeks starting from their return and then found a longer-term rental.

14. They were put to unexpected expense due to this upheaval. They were not able to get their vaccinations and so they had to change their travel plans at additional cost. The stress, upset and inconvenience they suffered was considerable.

Discussion

15. The landlord has not complied with her obligation to inform the tenants that the premises were being marketed for sale when she was offering the premises to rent, and that breach continued throughout the tenancy until 4 November 2025.

16. The tenants were then faced with the buyers telling them that they had to vacate in 10 days time when they believed that the landlord had agreed to extend the tenancy for another year.

17. The landlord had not signed the agreement extending the tenancy, but it is clear from the email correspondence that she had agreed it. She expressly said that she would sign and return the agreement. On the face of it therefore, the parties had an agreement to extend the tenancy. Tenancy agreements do not have to be in writing to be binding and enforceable. They can be entirely oral or partly oral and partly in writing. The issue is whether the parties intended there to be an agreement and whether they had agreed on its essential terms. The evidence in this case is that they did, and they had.

18. It follows that the tenants could have insisted that they had an extended agreement and refused to move. No doubt that would have put the other parties involved in a very difficult position. None more so than the landlord who would not have been able to provide vacant possession of the premises to the buyer. It is likely that such a situation would have been costly for the landlord.

19. At the very least, the tenants could have refused to leave the premises until they received a 42-day termination notice from either the landlord or the buyer. That too would no doubt have created difficulties for the others concerned.

20. The tenants felt extremely pressured at the time and they agreed to leave on the settlement date thus saving the other parties the distasteful consequences

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of this debacle. It is obvious that the landlord bears the primary responsibility for the situation. She has not offered any explanation for her failure to properly inform the tenants of her actions. How others permitted this situation to arise is another open question.

Result

21. I find that the landlord’s failure to comply with her obligations towards the tenants regarding the sale of the premises was intentional. It is hardly something that can arise accidently. Possibly the landlord was unaware of her obligations but that would be no defence. Everyone is deemed to know the law. Even then it cannot explain the landlord’s behaviour. She led the tenants to believe that they could stay in the premises for another year at a time when she had agreed to sell the premises to buyers who wanted vacant possession of them.

22. This situation should never have arisen, and it was entirely avoidable. It was seriously detrimental to the tenants. They said that they would not have accepted the tenancy in the first place if they had known that the landlord was intending to sell the premises. This kind of behaviour must be discouraged, and an award of exemplary damages is required.

23. It is difficult to imagine a worst example of this kind of breach and so I have awarded the maximum sum for the breach - $1,800.

24. The tenants are also entitled to compensation. The money compensation they have sought would be offset by the rent that they have avoided paying during their time abroad and so I make no award in that respect. But they entitled to a significant award for the considerable upset, inconvenience and disappointment they have suffered. An award of $2,000 is appropriate.

25. The tenants have succeeded and so I have awarded them the filing fee.

[NAME]

03 June 2026

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Please read carefully: Visit justice.govt.nz/tribunals/tenancy/rehearings-appeals for more information on rehearings and appeals.

Rehearings You can apply for a rehearing if you believe that a substantial wrong or miscarriage of justice has happened. For example: • you did not get the letter telling you the date of the hearing, or • the adjudicator improperly admitted or rejected evidence, or • new evidence, relating to the original application, has become available.

You must give reasons and evidence to support your application for a rehearing. A rehearing will not be granted just because you disagree with the decision. You must apply within five working days of the decision using the Application for Rehearing form: justice.govt.nz/assets/Documents/Forms/TT-Application-for-rehearing.pdf

Right of Appeal Both the landlord and the tenant can file an appeal. You should file your appeal at the District Court where the original hearing took place. The cost for an appeal is $260. You must apply within 10 working days after the decision is issued using this Appeal to the District Court form: justice.govt.nz/tribunals/tenancy/rehearings-appeals

Grounds for an appeal You can appeal if you think the decision was wrong, but not because you don’t like the decision. For some cases, there’ll be no right to appeal. For example, you can’t appeal: • against an interim order • a final order, or the failure to make an order, where the amount in dispute on appeal is

less than $1000 • a final order to undertake work, or the failure to make an order, where the value of the

work in dispute on appeal is less than $1000.

Enforcement Where the Tribunal made an order about money or property this is called a civil debt. The Ministry of Justice Collections Team can assist with enforcing civil debt. You can contact the collections team on [PHONE] or go to justice.govt.nz/fines/civil-debt for forms and information.

Notice to a party ordered to pay money or vacate premises, etc. Failure to comply with any order may result in substantial additional costs for enforcement. It may also involve being ordered to appear in the District Court for an examination of your means or seizure of your property.

If you require further help or information regarding this matter, visit tenancy.govt.nz/disputes/enforcing- decisions or phone Tenancy Services on [PHONE].

Mēna ka hiahia koe ki ētahi atu awhina, kōrero ranei mo tēnei take, haere ki tenei ipurangi tenancy.govt.nz/disputes/enforcing-decisions, waea atu ki Ratonga Takirua ma runga [PHONE] ranei.

https://www.justice.govt.nz/tribunals/tenancy/rehearings-appeals https://www.justice.govt.nz/assets/Documents/Forms/TT-Application-for-rehearing.pdf https://www.justice.govt.nz/tribunals/tenancy/rehearings-appeals/ https://www.justice.govt.nz/fines/about-civil-debt/ https://www.tenancy.govt.nz/disputes/enforcing-decisions https://www.tenancy.govt.nz/disputes/enforcing-decisions http://www.tenancy.govt.nz/disputes/enforcing-decisions/

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A manaomia nisi faamatalaga poo se fesoasoani, e uiga i lau mataupu, asiasi ifo le matou aupega tafailagi: tenancy.govt.nz/disputes/enforcing-decisions, pe fesootai mai le Tenancy Services i le numera [PHONE].

Reasons: