Tenant Wins Bond Lodgement and Penalty Charge Case at Tenancy Tribunal
📌 In brief
The Tenancy Tribunal ruled in favour of the tenant, ordering the landlord to pay $1,298.00. This amount included damages for the landlord's failure to lodge the bond within the required timeframe and for including illegal penalty charges in the tenancy agreement.
⚖️ Legal holding
A landlord must lodge the bond with the Bond Centre within 23 working days of receiving it under the Residential Tenancies Act 1986.
📖 What the law says
When a landlord receives a bond payment, they must give the person who paid it a signed written receipt right away. This receipt needs to show the address of the property, the amount and type of payment, the date it was paid, and the name of the person who paid it. The landlord must also send the bond amount to the chief executive within 23 working days of receiving it.
A landlord or tenant can ask the Tenancy Tribunal to order another person to pay exemplary damages if that person has committed an unlawful act. For certain unlawful acts related to bonds, this application must be made no later than 12 months after the tenancy ends.
Plain-English explanation — does not replace advice from a lawyer.
📖 Technical summary
The Tribunal awarded damages to the tenant for the landlord's failure to lodge the bond within the required timeframe and for illegal penalty charges in the tenancy agreement.
📜 Headnote Official document
The Tenancy Tribunal ordered the landlord to pay the tenant $1,298.00 for failing to lodge the bond within the required timeframe and for imposing illegal penalty charges in the tenancy agreement. The Tribunal found that the landlord breached the Residential Tenancies Act 1986 by not lodging the bond within 23 working days and by including unenforceable penalty charges in the agreement.
📚 Full judgment Official document
__________________________________________________________________________________ 5230211 1
[2025] NZTT 5230211
TENANCY TRIBUNAL AT [Event location suppressed]
APPLICANT: [redacted]
Tenant
RESPONDENT: [redacted]
Landlord
TENANCY ADDRESS: Unit/Flat 308B, 8 Lakewood court, Manukau, Auckland 2104, [NAME]
ORDER
[NAME] must pay [The tenant/s] $1,298.00 immediately, calculated as shown in table below:
Description Landlord Tenant Exemplary damages: bond not lodged until 1 April 2025 $500.00 Refund of all payments received by landlord towards water and electricity
$814.00
Electricity charges payable by the tenant for 6 months $360.00 Bond overpaid to landlord $317.00 Filing fee reimbursement $27.00 Total award $360.00 $1,658.00 Net award $1,298.00 Total payable by Landlord to Tenant $1,298.00
Reasons:
1. Both parties attended the hearing.
2. The tenant seeks return of water rates and electricity charges paid to the landlord. The tenant also takes issue with the tenancy agreement stating that penalty charges of $20.00 a week when the tenant is in default of water rates and electricity charges payments.
__________________________________________________________________________________ 5230211 2
3. There are parts in the tenancy agreement which are clearly unenforceable and illegal. A landlord cannot charge a penalty or liquidated damages against a tenant even if the tenant has defaulted on lawful payments to the landlord. The landlord accepts this during the hearing and ultimately no penalty charges had been paid by the tenant. The landlord acknowledges the stress that this has caused on the tenant.
4. As for outgoings, the parties have come to an agreement for the return of overpaid charges as set out in the table above. The only amounts towards outgoings that the landlord can lawfully charge the tenant pursuant to section 39 Residential Tenancies Act 1986 are on metered electricity charges based on actual consumption.
5. For ease of accounting, I have set-off $360.00 for 6 months’ electricity charges payable by the tenant against the total amounts collected by the landlord throughout the tenancy towards water rates and all electricity charges received.
6. Apart from two weeks rent arrears of $900.00 and $50.00 security card replacement costs, the landlord cannot keep the balance of the bond that was refunded by the bond centre earlier. I order the return of $317.00 by the landlord to the tenant accordingly.
7. [The tenant/s] claims the landlord has not lodged the bond with the Bond Centre within the required time.
8. A landlord must send any bond payment to the Bond Centre within 23 working days after the payment is received. See section 19(1) Residential Tenancies Act 1986.
9. Breaching this obligation is an unlawful act for which the Tribunal may award exemplary damages up to a maximum of $1,500.00. See section 19(2) and Schedule 1A Residential Tenancies Act 1986.
10. The landlord only lodged the bond on 1 April 2025, after some 6 months into the tenancy which commenced in October 2024. I find they have committed an unlawful act.
11. 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. See section 109(3) Residential Tenancies Act 1986.
12. Having regard to the above factors, I consider that an award of exemplary damages of $500.00 against the landlord is appropriate. The landlord is an experienced landlord who has lodged bonds before. The landlord says that she had to return to India after receipt of the bond and overlooked the bond lodgement. However, the bond could have been lodged shortly after the
__________________________________________________________________________________ 5230211 3
landlord had returned from overseas; the landlord failed to lodge the bond until April 2025.
13. Because [The applicant/s] has substantially succeeded with the claim I have reimbursed the filing fee.
[NAME] 15 May 2025
__________________________________________________________________________________ 5230211 4
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 for the payment of less than $1000 • a final order to undertake work worth 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/
__________________________________________________________________________________ 5230211 5
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:
⚖️ What tends to weigh in cases like this
✅ Tends to be accepted
- The landlord must lodge the bond within 23 working days after receiving it.
- The landlord cannot charge penalty fees for late payments of utilities.
- The tenant is entitled to a refund of overpaid utility charges.
- Exemplary damages can be awarded for failing to lodge the bond on time.
- The filing fee is reimbursed to the tenant when the claim is successful.
❌ Tends to be rejected
- Penalty charges for late utility payments were attempted but deemed illegal.
- The landlord tried to retain the full bond amount despite overcharging the tenant.
- The landlord argued that the tenancy agreement allowed for penalty charges.
Patterns observed in similar cases in this collection — every case is unique.
❓ Frequently asked questions
What did this decision decide?
The Tenancy Tribunal ordered the landlord to pay the tenant $1,298.00 for failing to lodge the bond within the required timeframe and for imposing illegal penalty charges in the tenancy agreement.
What was the dispute about?
The tenant disputed the landlord's failure to lodge the bond within the required timeframe and the inclusion of illegal penalty charges in the tenancy agreement.
How did the court decide, and why?
The court decided in favour of the tenant because the landlord failed to lodge the bond within the required timeframe and included illegal penalty charges in the tenancy agreement, both of which are violations of the Residential Tenancies Act 1986.
Which laws or rules were applied?
The Residential Tenancies Act 1986, sections 19(1), 19(2), and 109(3) were applied.
What was the argument that mattered most?
The argument that mattered most was that the landlord failed to lodge the bond within the required timeframe and included illegal penalty charges in the tenancy agreement.
Was the decision for or against the person who brought the case?
The decision was for the tenant who brought the case.
What does this mean for someone in a similar situation?
For tenants in a similar situation, it means that landlords must lodge the bond within the required timeframe and cannot include illegal penalty charges in the tenancy agreement.
What evidence or documents mattered?
The judgment does not specify the exact evidence or documents that mattered.