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A Rotorua landlord who tried to fix a leaky roof with a tea towel has been ordered to pay $12,000 in exemplary damages after his tenant was left “sleeping on the lounge floor” with their children due to rainwater leaking into the bedroom.
The Tenancy Tribunal has found Stephen Chiman Bhana breached the Residential Tenancies Act 1986 for two tenancies at a two-bedroom property in Rotorua.
Bhana was ordered to pay $12,020.44 in exemplary damages to the Ministry of Business, Innovation and Employment (MBIE) on behalf of two tenancies affected.
Bhana was found to have charged rent “well above” market rate and ordered to reimburse a tenant more than $8700 in backdated, overpaid rent.
Landlord Stephen Bhana has been ordered to pay $12,000 in exemplary damages in relation to two tenancies at a Rotorua property. Pictured are holes in the roof causing it to leak.
The tribunal issued Bhana with a three-year restraining order – something it “rarely” does – after making previous findings against the landlord for failing to maintain his tenancies.
Bhana has applied for a rehearing of the decision at the Tenancy Tribunal and has also appealed the decision in the District Court. A stay of proceedings had been granted in respect of the exemplary damages awarded.
In February, Bhana was ordered by a Rotorua District Court judge to pay more than $50,000 plus interest after losing a long-running battle over a property in Fordlands.
A hearing about the latest case took place in Rotorua on May 15 and 16.
The tribunal report, between MBIE chief executive and Stephen Bhana, showed the ministry’s tenancy compliance and investigations team visited the property four times between November 2022 and April 2023 after complaints from tenants.
The report included evidence from one tenant who moved into the property in 2023 with their two children. The tribunal ordered suppression of the names and identifying details of the tenants.
The tenant said the rent was $750 per week. Due to Rotorua’s housing shortage, they were not in a position to wait for another property to become available.
The lawns were “badly overgrown and flooded” and a “large amount of rubbish” was around the property when they first moved in.
They asked Bhana multiple times to have the lawns mowed and the rubbish removed but he had not done so, apart from one pile.
The chattels included a recliner chair “covered in green mould”, a couch, one double bed, and two single beds. Due to their “very poor condition”, they requested Bhana remove them but only the couch was removed.
Damage to the roof above the front bedroom at Rotorua landlord Stephen Bhana's property.
The roof leaked in one bedroom – the “seriousness” of which meant the bedroom could not be used – and the tenant placed a bucket in the room to catch rainwater which could accumulate “up to half” a bucket of water overnight.
“I am currently sleeping on the lounge floor with my children.”
They notified Bhana multiple times about the leaky roof, but the landlord did not do anything.
Bhana asked the tenant about a plumber going to the house. The tenant said no plumber had been to the house.
Holes in the floor at Rotorua landlord Stephen Bhana's property.
The report said Bhana opposed the evidence of the MBIE investigations officers because he considered it was unlawfully obtained and should be excluded.
Bhana submitted this resulted in prejudice, including the “missed opportunity” to clarify any concerns raised at the time of the inspection.
The tribunal said the officers’ entry was not unlawful because they had been invited by the tenants.
Exemplary damages
MBIE submitted that Bhana breached his obligation to provide the premises “reasonably clean” at the start of the second tenancy, which Bhana disputed.
The tribunal said Bhana was “likely to have been aware” of rubbish at the property.
MBIE submitted the premises were poorly maintained.
In response, Bhana stated there had never been a notice to fix or a Dangerous and Insanitary Building Notice issued.
Bhana stated “this is the first time” issues had been raised by the tenant, they could have contacted him earlier with their concerns, and they had not recorded some of the issues in the pre-tenancy inspection report.
The tribunal said Bhana had done “some” repair to the roof, but this was “inadequate”.
MBIE sought exemplary damages for the landlord breaching the Healthy Homes Standards, given there was no underfloor insulation, no ceiling insulation and the open fire not being sealed.
In response, Bhana said underfloor insulation was installed in 2019 and he did not know what happened to it. He questioned if the insulation had been stolen.
In relation to a ground moisture barrier, Bhana submitted he did not know one was needed. He had health problems at the time which were taking his focus.
Bhana said there was a board over the old open fire, and did not know why it was removed.
The tribunal said Bhana had breached Healthy Homes Standards concerning draught stopping and drainage/moisture ingress.
MBIE submitted that Bhana failed to produce documentation requested in December 2022 by a January 2023 deadline.
In response, Bhana said the tenancy file was misplaced and he had “no way” of getting this information to the investigator.
Bhana said the information was “not withheld with malice” and had been provided but had “taken some effort” to get together.
The tribunal found Bhana failed to provide the information as required without a reasonable excuse.
Bhana charged ‘well above’ market rate
MBIE submitted the $750 weekly rent was “well above” market rate and the market rent assessment would be $458.
MBIE referred to recent Trade Me listings in Rotorua’s Victoria suburb, with two-bedroom homes being listed at $495, $540, and $550. A three-bedroom home was $580.
In response, Bhana submitted the properties identified in Trade Me listings did not match the tenancy. For example, the tenancy was “large, on a separate section, and furnished”.
Bhana submitted the difference in rental prices between this tenancy and those in the Trade Me listings would reflect it being fully furnished.
The tribunal found the market rent for the property was $486 and Bhana had exceeded market rent by a “substantial” amount.
The tribunal ordered the landlord to reimburse the tenant any rent received in excess of $486, backdated to November 2023.
MBIE sought a restraining order meaning Bhana cannot commit further unlawful acts given the repeated breaches by him and the evidence showing despite issues being raised by tenants, the work needed was not done.
Bhana opposed the restraining order on the basis it implied he had not carried out his obligations under the Residential Tenancies Act in a reasonable way.
The tribunal found there were grounds for a three-year restraining order.
MBIE sought work orders against Bhana for repairs or placements to the roof, heat pump, downpipes, drainage systems, rotten timber, the laundry floor, and locks on doors and windows by professionals. Orders were also made to install a ground moisture barrier and to cover and seal the open fireplace by July 23.
An MBIE media release on September 2 said the repairs had not yet been completed. The tenancy compliance and investigations team would continue to monitor.
It said Bhana had applied for a rehearing of the decision at the Tenancy Tribunal and had also appealed the decision in the District Court. Both proceedings were pending.
In the interim, a stay of proceedings had been granted in respect of the exemplary damages awarded but the work order, market rent order and rent reimbursement orders must still be complied with.
Megan Wilson is a health and general news reporter for the Bay of Plenty Times and Rotorua Daily Post. She has been a journalist since 2021.
