Overview of Residential Tenancies Amendment Act 2019

Overview of Residential Tenancies Amendment Act 2019

By: MBC Law
April 16, 2020

The Residential Tenancies Amendment Act 2019 (“RTAA”) was passed on 30 July 2019 and came into effect on 27 August 2019. The RTAA addresses key issues that have implications for both landlord and tenant including: tenant liability for damage, insurance statements, contamination of premises and unlawful residential premises. 

Tenant liability for damage: The RTAA provides that if tenants or their guests damage a rental property due to their careless behaviour, the tenant will have to pay for the cost of the damage up to (whichever is the lower) a maximum of four weeks’ rent or the landlord’s insurance excess. 

This amendment aims to encourage tenants to look after the premises they are renting, while ensuring they are not responsible for unreasonable repair costs. On the other hand, it also ensures that landlords are not burdened with the entire repair cost as a result of their tenant’s damage to the premises.

Notwithstanding the above, tenants are still fully responsible for the cost of intentional damage to the premises.

Insurance statements: Landlords must provide a copy of their insurance details to the tenant, including whether the property is insured, and if so, what the excess is. With an existing tenancy (pre 27 August 2019), the tenant can request this information from the landlord. If the landlord does not provide the information, or inform tenants of changes to insurance details, the landlord may be fined with up to $500.

Contamination of premises: Landlords can test for meth contamination, while the rented premises are occupied, by giving tenants at least 48 hours’ notice.

Landlords must notify their tenant that they are testing for meth and the tenant has the right to see the test results. 

Recently there have been discussions regarding meth testing and what the acceptable standard of contamination (if any) is. The RTAA allows for regulations (yet to be introduced) for determining the process for testing, the acceptable contamination level, and the decontamination process. Landlords will not be able to rent premises that they know are contaminated at an unacceptable level. 

Unlawful residential premises: Under the RTAA, the definition of ‘residential premises’ is amended so that even if a premises cannot be legally lived in, such as a garage or industrial building, but is lived in or intended to be lived in, they will still fall within the definition of a residential premises and accordingly be captured under the RTAA and fall within the jurisdiction of the Tenancy Tribunal. The Tenancy Tribunal can enforce the RTAA against landlords who breach the RTAA regardless of whether the premises are suitable for living in or not. 

This change ensures that landlords are providing premises that meet all requirements relating to buildings and health and safety. 

If a landlord provides an unlawful residential premises to their tenant, the landlord may be liable to pay all or some of the rent back to the tenant, the tenancy may be terminated, the landlord may be liable to the tenant for damages, or any other order the Tenancy Tribunal may provide. 

Whether you are planning to become a landlord or tenant, we suggest speaking to your lawyer to assist with preparing a tenancy agreement in accordance with the RTAA. If you are an existing landlord or tenant, we suggest you revise the rights and obligations under the RTAA with your lawyer to ensure your tenancy arrangement(s) are compliant under the RTAA.

General consequence when bankruptcy is declared

It is always a difficult time when you find that you are earning 99c but regularly spending $1.00. If you cannot turn the position around, personal bankruptcy being declared against you looms as a real consequence.

Filing for bankruptcy itself is the most serious alternative when you are in financial difficulties, and the whole situation is stressful, so sharing the problem with your lawyer in the first instance can help clarify the best way forward. 

The general consequences are significant. In brief, any proceedings commenced against you to recover debts are halted, and some are actually cancelled. However, the personal cost is high. Certain debts will still remain payable, and any assets you had recently transferred within a two year window may be able to be clawed back from the recipient. 

While you are able to retain essential personal items, the remainder is sold. Your credit rating will be affected, and you cannot buy or own significant assets for a period of three years. After this three year period you are able to be discharged from the bankruptcy.

The office of the Official Assignee can be approached directly regarding your bankruptcy, but there is no downside to asking your lawyer first to review the options with you.


Statutory entitlement for sick leave

We all get sick from time to time, and New Zealand law in the form of the Holidays Act 2003 recognises that an employee will be paid for some of those times, and rightly so.

As a general rule, the minimum sick leave available is five days per year. Employees receive another five days sick leave for each twelve month period following on from that. This entitlement should be enshrined in an employee’s agreement with their employer.

A prerequisite to using sick leave is that an employee must have been in the same job for a continuous period of six months. There are also a minimum number of hours each week that underpin the entitlement.

Sick leave is available if an employee is sick or injured, or when a spouse or partner who depends on the employee is sick or injured. The availability of ACC is relevant when injuries occur.

Longer sick leave periods can be negotiated with an employer. Any unclaimed leave can be carried over from year to year, but accumulation options are to be clarified on a case-by-case basis.

But who wants to be sick!