News & Updates

26-05-2016

Two recent Tenancy Tribunal cases have increased the risk levels for landlords where P is found in their properties.

The first case involved a rental property where the owner and the property manager didn't know that the previous occupants had smoked P in the property. It was a neighbour who told the tenant that they should get the property checked for meth.

The tenants paid for an inspection and the reading came back at 0.53 micrograms per 100cm2. The Ministry of Health currently recommends that following a meth lab cleanup, levels should not exceed 0.5 micrograms per 100cm2 to be acceptable for reoccupation. To provide some context, a property used as a meth lab may have concentrations of 300 micrograms per 100cm2.

The tenant immediately gave notice and left on 5 December 2015, just three weeks after the tenancy had begun.

The landlord obtained his own test on 5 January, which showed residual levels of P considerably below the MOH guidelines. This test found that the highest concentration level was in the kitchen, and was only 0.17 micrograms per 100cm2. The other seven test areas were considerably lower than this.

There have been reports of testing companies adding up the levels found in different areas of a property, which can overstate the level of residual P in a property. It appears that the first testing company did this.

The tenant took the landlord to the Tenancy Tribunal to end the fixed term tenancy and the return of the bond plus refund of the $569.25 letting fee they paid, $199 cost for the Meth Test and $315 to remove their possessions.

The adjudicator awarded all of this to the tenant. When the lost rent is factored into this, the landlord is considerably out of pocket.

The adjudicator said that landlords had a responsibility to provide a property in a reasonably clean state. Although it was found that the property was actually well below the MOH guidelines, the adjudicator found that "a property with any level of methamphetamine" is unclean.

He ruled "That the landlord belatedly obtaining a contrary result does not relieve the landlord, in my view, from liability for the situation that rose a month earlier.Accordingly I find that the landlord is in breach for failing to provide a property that was habitable."

The adjudicator acknowledged that "the effect of this decision may be onerous on landlords in that a landlord who does not have a property tested for methamphetamine contamination prior to renting, risks financial consequences, irrespective of whether or not the landlord had cause to suspect that the property was contaminated".

This case raises many points. There clearly needs to be standards put in place for the testing of meth. Adding together all amounts of residual meth found in a property clearly overstates the level.

It appears that a tenant who wants to break a fixed term tenancy can merely smoke some P in the property to achieve their aim.

The case also places a high cost on all landlords and all rental properties if they are required to undertake independent meth tests before and after a tenancy has begun.

There also needs to be some independent and rational investigation into what is a reasonable level of P in a property below which it can be viewed as reasonably clean. The MOH guidelines state that after cleaning a property used for meth cooking, it is habitable if the level is not greater than 0.5 micrograms per 100cm2. Surely this should be the level that demonstrates that a property is reasonably clean.

The second case is even more concerning as the financial cost was high. Although the levels of residual meth were not presented, the adjudicator made a similar finding to the first case that the property was uninhabitable. However the award that was made was quite different.

The tenants had occupied the rental property from August to November 2015 and claimed all the rent they had paid over that time,$7,275 to be returned. The tenants also claimed $4,025 for disposing of possessions they claimed were contaminated and storage costs for other items amounting to $890.

The adjudicator did not award that all the rent money should be returned to the tenant, acknowledging that they did get over three months of accommodation. However he did state that it was not the accommodation they "bargained for", and ruled that $3,500 should be returned to the tenant.

The cost for disposing of some possessions was also upheld, but not the storage. So in total, the landlord was required to pay the tenant a total of $7,525.

The NZPIF will be discussing the issue of meth contamination with the Principal Tenancy Adjudicator. We are also having discussions with MBIE about how the issue of meth can be handled so that tenants are protected but the risks to landlords are also mitigated.

Standards New Zealand is looking at how meth testers and cleaners can and should be regulated and we have applied to be part of the committee devising these standards.

It may be that best practice for landlords will be to test for meth at the beginning and end of tenancies. Apart from confirming when a property was and wasn't free of any residual meth, this could persuade tenants not to smoke meth in the property.

If this is to occur then we will be advocating that self testing can be undertaken to keep costs down and will be looking at options to lower the cost of self test kits for members.