compensation for breaches
📖 What is compensation for breaches? Meaning and definition
In New Zealand tenancy law, 'compensation for breaches' is a financial remedy ordered by the Tenancy Tribunal. It aims to put the affected party in the position they would have been in had the breach not occurred. This can apply to various situations, such as a landlord failing to provide the premises in a reasonable state of cleanliness, not providing a copy of the tenancy agreement, or entering the property without consent. Tenants can also be ordered to pay compensation, for example, for rent arrears or lost rent due to insufficient notice.
The Tenancy Tribunal considers applications from both landlords and tenants for compensation. The amount awarded is calculated based on the specific breach and the impact it had. For instance, compensation might cover a rent reduction for a period where the property was uninhabitable, or specific costs incurred due to the breach, like power usage if hot water was unavailable.
This compensation is distinct from other claims like exemplary damages, though both may be sought in the same application. The Tribunal's orders will detail the specific breaches for which compensation is awarded, often referencing sections of the Residential Tenancies Act (RTA) that were violated. The total compensation awarded is then factored into the overall financial settlement between the parties, which may also include bond refunds or filing fee reimbursements.
📋 Requirements
- A breach of the Residential Tenancies Act or the tenancy agreement must have occurred.
- The breach must be identified, often referencing specific sections of the RTA.
- An application for compensation must be made to the Tenancy Tribunal by either the landlord or the tenant.
- The Tenancy Tribunal must determine the amount of compensation payable based on the nature and impact of the breach.
📝 Procedure
- One party (landlord or tenant) files an application with the Tenancy Tribunal claiming compensation for breaches.
- Both parties attend a hearing where they present their cases and evidence.
- The Tenancy Tribunal considers the evidence and relevant legal considerations, including sections of the Residential Tenancies Act.
- The Tribunal calculates the compensation amount for each identified breach.
- An order is issued detailing the compensation payable, often alongside other awards like bond refunds or filing fee reimbursements.
💡 Examples
- A tenant was awarded $600 in compensation because the landlord failed to provide the rental property in a reasonable state of cleanliness at the start of the tenancy.
- A landlord had to pay $1,500 in compensation to a tenant for entering the premises without the tenant's consent or a Tribunal order.
- Tenants received $728.53 in compensation as a rent reduction for 17 days due to maintenance issues that affected their living conditions.
- A tenant was awarded $500 for the landlord's failure to provide them with a copy of the tenancy agreement as required by law.
❓ Frequently asked questions
What kind of breaches can lead to compensation?
Compensation can be awarded for various breaches, such as a landlord not providing a clean property, failing to give a tenancy agreement copy, or entering without permission. Tenants might pay compensation for unpaid rent or insufficient notice.
How is the amount of compensation determined?
The Tenancy Tribunal determines the amount based on the specific breach and its impact. This could involve calculating lost rent, specific costs incurred, or a general amount for the inconvenience or violation of rights.
Can both landlords and tenants claim compensation?
Yes, both landlords and tenants can apply to the Tenancy Tribunal for compensation if they believe the other party has breached their obligations under the tenancy agreement or the Residential Tenancies Act.
Is compensation the same as exemplary damages?
No, compensation aims to cover actual losses or impacts from a breach, while exemplary damages are awarded to punish a party for particularly bad behaviour and deter similar actions. They can sometimes be claimed together.
What if I don't know which section of the Act applies to my situation?
While it's helpful to reference specific sections, the Tenancy Tribunal will assess the facts of your case against the relevant law. You should clearly describe the breach and how it affected you. For complex situations, you may wish to consult with a lawyer.