Maximum occupancy – don’t sit on your rights

Knowledge or acquiescence of a tenant exceeding maximum occupancy could invalidate a subsequent claim for exemplary damage.

RE: Driskel v Zoetebier [2021] NZTT Hutt Valley 4271298, 4277832 

This is a claim and counterclaim hearing that covers a number of issues in connection to the tenancy. For the purpose of this discussion, we will be addressing
the breach of maximum occupancy limit exclusively.

Facts

• The tenancy agreement limits the occupancy to no more than 2.
• The tenant had, from time to time, exceeded the maximum occupancy.
• By all accounts, the landlords had been sufficiently present enough throughout the tenancy as to be aware of the actual number of occupants living
  at the property.
  • The tenant’s uncle – Though the landlords initially gave permission for the tenant’s uncle to move in temporarily, it had transpired subsequently
    (through inspections) that the uncle had indeed become a permanent resident at the property.
  • The tenant’s new partner – The landlords were aware of the tenant’s new partner moving into the property with her during the tenancy (and,
    in fact, engaged the partner’s trade services at the property from time to time).
• Despite having knowledge that the tenant had breached the tenancy agreement, the landlords never issued any 14-day notices or sought to enforce their
  rights in this respect until after the tenancy had ended.

The law

Exceeding maximum occupancy is an unlawful act under the Residential Tenancies Act and can attract as much as $1,000 in exemplary damages.

The analysis 

The adjudicator’s own words can be understood plainly enough:

“… although the tenancy agreement recorded that there were to be “two occupants” only, [the landlords], by their conduct, can be understood to have agreed to others occupying the property. If they wanted to make occupancy an issue they should have done so during the tenancy and not waited until the end of the tenancy. It is not reasonable to order exemplary damages in these circumstances.”
(our bold)

The outcome

No exemplary damages were awarded in this instance.

Take-home for landlords

Don’t sit on your rights. It is unclear from the wording of the order whether a similar hard-line approach would be taken for other types of breaches by
tenants. Given that it is relatively easy to enforce one’s tenancy rights by way of 14-day notices there is really no reason why any landlord would,
in this stricter renting climate, acquiesce to any breaches suffered.

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