Tribunal Declares Unlawful Premises and Dismisses Rent Claims
📌 In brief
The Tenancy Tribunal ruled that the residential premises were unlawful and dismissed the landlord's claims for rent arrears and compensation. The tenants are not required to pay further rent.
⚖️ Legal holding
A tenant is not required to pay further rent for unlawful residential premises.
📖 What the law says
This section gives the Tenancy Tribunal the power to resolve disagreements between landlords and tenants about tenancies covered by this Act. It also specifically allows the Tribunal to decide if a property is considered residential premises under the Act and if a tenancy agreement exists.
Plain-English explanation — does not replace advice from a lawyer.
📖 Technical summary
The Tribunal declared the residential premises unlawful and dismissed the landlord's claims for rent arrears and compensation.
📜 Headnote Official document
The Tenancy Tribunal declared the residential premises unlawful and dismissed the landlord's claims for rent arrears and compensation, ruling that the tenants are not required to pay further rent.
📚 Full judgment Official document
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[2025] NZTT 5093571
TENANCY TRIBUNAL AT WELLINGTON | TE TARAIPIUNARA RETIHANGA KI TE WHANGANUI-A-TARA
APPLICANT: [redacted]
Landlord
RESPONDENT: [redacted]
Tenant
TENANCY ADDRESS: [ADDRESS], [POSTCODE]
ORDER
1. The parties reached agreement that the tenancy of [NAME] and [NAME] at [ADDRESS], [POSTCODE] is terminated, and possession is granted to [NAME], at any time the tenants choose to leave before, but no later than, Saturday, 4 July 2025.
2. The [COMPANY] is to pay the bond of $2,000.00 (6475627-004) to [NAME] and [NAME] immediately.
3. The tenancy premises provided by [NAME] and occupied by the tenants is unlawful residential premises.
4. The tenants are not required to pay any further rent until termination of the tenancy.
5. The landlord’s claim for rent arrears is dismissed.
6. The landlord’s claim for compensation for other expenses, such as power, is dismissed.
Reasons:
1. Both parties attended both hearings.
Is the premises unlawful residential premises?
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2. [ADDRESS], Newlands, Wellington is a house that has been subdivided so it can be occupied by two households. The subdivision was carried out by a previous owner. Following an adjournment to check the status of the property, it is confirmed that the change of use of the house to two household units was not permitted by Wellington City Council.
3. The premises occupied by the tenants is therefore unlawful residential premises. See section 77(2)(ac) Residential Tenancies Act 1986.
4. Residential premises are unlawful if they cannot be lawfully occupied for residential purposes, and the landlord has caused or contributed to the unlawful occupation by failing to comply with sections 36 or 45(1)(c) RTA. See section 78A(2) RTA.
5. Where the Tribunal declares the residential premises to be unlawful, it must not make an order for rent arrears or compensation against the tenant unless, having regard to the special circumstances of the case, it would be unjust not to make the order. I have ordered that the claim for rent arrears and compensation is dismissed.
6. The Tribunal may order the return of all rent paid by the tenant, although it may deduct an amount from that sum if, in the special circumstances of the case, it would be fair to do so. The Tribunal may make any of these orders on its own initiative, even if the tenant has not applied for a particular order. See sections 78A(3)(a), (4) and (5) RTA. I am satisfied that the merits and justice of the case are that rent is not refunded but that no further rent is due to termination of the tenancy.
7. The Tribunal may order termination, but it is not required to do so. See section 78A(3)(b) RTA. The parties agreed on a date for termination.
8. I have considered whether to order exemplary damages for the unlawful act of renting unlawful residential premises. Exemplary damages may be ordered where an unlawful act is committed intentionally. I am satisfied that the landlord did not commit the act intentionally. I accept that he believed that the subdivision was lawful at the time he purchased the property. An order for exemplary damages cannot be made.
[NAME]
04 June 2025
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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 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/
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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:
⚖️ What tends to weigh in cases like this
✅ Tends to be accepted
- The premises are unlawful residential premises.
- The landlord caused the unlawful occupation by failing to comply with relevant sections of the Residential Tenancies Act.
- The Tribunal declared the residential premises unlawful and dismissed the claim for rent arrears.
- The Tribunal dismissed the claim for compensation for other expenses, such as power.
❌ Tends to be rejected
- The tenant is required to pay further rent for unlawful residential premises.
- The landlord's claim for rent arrears was not justified given the unlawful nature of the premises.
- The landlord's claim for compensation for other expenses was not warranted due to the unlawful occupation.
- The Tribunal did not order exemplary damages for renting unlawful residential premises as the landlord did not commit the act intentionally.
Patterns observed in similar cases in this collection — every case is unique.
❓ Frequently asked questions
What did this decision decide?
The Tribunal declared the residential premises unlawful and dismissed the landlord's claims for rent arrears and compensation.
What was the dispute about?
The dispute was about whether the residential premises were lawful and whether the tenants owed rent arrears and compensation.
How did the court decide, and why?
The court decided that the premises were unlawful and dismissed the landlord's claims because the landlord failed to comply with the necessary regulations.
Which laws or rules were applied?
The Residential Tenancies Act 1986, sections 77(2)(ac) and 78A(2) were applied.
What was the argument that mattered most?
The argument that mattered most was that the premises were unlawfully subdivided and could not be legally occupied for residential purposes.
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?
Someone in a similar situation may not be required to pay rent if their premises are declared unlawful.
What evidence or documents mattered?
The evidence that mattered included the status of the property and the legality of the premises subdivision.