Scott v Housing New Zealand Corporation
[2015] NZHC 1401
•19 June 2015
IN THE HIGH COURT OF NEW ZEALAND TAURANGA REGISTRY
CIV-2015-470-28 [2015] NZHC 1401
IN THE MATTER of an Appeal pursuant to section 119 of the
Residential Tenancies Act 1986
BETWEEN
BARRY WILLIAM SCOTT Appellant
AND
HOUSING NEW ZEALAND CORPORATION
Respondent
Hearing: 12 June 2015
(Heard in Rotorua)
Counsel:
MJ Sharp and H Leaf for appellant
CP Paterson and K Tuhakaraina for respondentJudgment:
19 June 2015
JUDGMENT OF FAIRE J
This judgment was delivered by me on 19 June 2015 at 4:30 pm pursuant to Rule 11.5 of the High Court Rules.
Registrar/Deputy Registrar
Date……………
Solicitors: Holland Beckett, Tauranga
Meredith Connell, Auckland
Scott v Housing New Zealand Corporation [2015] NZHC 1401 [19 June 2015]
Contents
The appeal ..............................................................................................................[1] The grounds of appeal ............................................................................................[3] Background ............................................................................................................[4] The tenancy agreement ........................................................................................[15]
Legislative scheme ...............................................................................................[18] Relevant provisions: Residential Tenancies Act 1986 .........................................[20] Relevant provisions: Housing Restructuring and Tenancy Matter Act 1992 .......[24]
Procedural history ................................................................................................[34] Validity of the notice [35] Judgment of Judge Wolff, 22 January 2015 [36] This appeal [38]
Application for leave to introduce evidence on appeal ........................................[39] Appellant’s submissions .......................................................................................[44] Respondent’s submissions....................................................................................[48] Analysis ................................................................................................................[56] Result....................................................................................................................[72] Costs .....................................................................................................................[73]
The appeal
[1] This is an appeal on a question of law pursuant to s 119 of the Residential Tenancies Act 1986 from a judgment of Judge RP Wolff, dated 22 January 2015 in the District Court at Tauranga on appeal from a decision of the Tenancy Tribunal. Judge Wolff upheld the decision of the Tenancy Tribunal, which had ordered:
(a) That the appellant’s application for a declaration that the notice to
terminate is retaliatory be dismissed; and
(b)That the notice to terminate the tenancy dated 7 March 2014 is declared a valid and effective notice terminating the tenancy on
30 June 2014.
The Tribunal’s decision also dealt with a question of rent arrears, which I need not consider for the purposes of this appeal. Counsel confirmed that the appeal does not relate to the order that the notice of termination is not retaliatory.
[2] The appellant seeks an order pursuant to s 78(1)(a) of the Residential Tenancies Act 1986 that the respondent’s notice to terminate the tenancy was invalid and that his tenancy at 35A Taipari Road, Maungatapu, Tauranga remains in force.
The grounds of appeal
[3] The grounds of appeal can shortly be stated and are as follows:
(a) Was the District Court Judge wrong in law in deciding that:
(i)Housing New Zealand Corporation (HNZC) was not required to reach a decision whether the appellant was eligible to continue to be allocated Housing New Zealand housing (in terms of s 58A(2)(c)(ii) of the Housing Restructuring and Tenancy Matters Act 1992) before issuing a notice terminating the tenancy pursuant to s 51(1)(d) of the Residential Tenancies Act 1986; and
(ii)In finding that HNZC’s right to terminate the tenancy pursuant to s 58(1)(d) of the Residential Tenancies Act 1986 was not modified by s 11 of the Residential Tenancies Act to require that decision on continuing eligibility for HNZC housing to be made before a 90 day notice could be provided.
Background
[4] Mr Scott is a sickness beneficiary and has been a tenant of the HNZC from
5 February 2010. Throughout this time he has paid income related rent that was below market rent.
[5] The governing legislation for the income related rent subsidies is the Housing Restructuring and Tenancy Matters Act 1992. A tenant’s entitlement to income related rent is assessed annually and is dependent on tenants disclosing accurate and honest information about their financial and household circumstances.
[6] In November 2013 HNZC commenced an investigation into Mr Scott’s circumstances. The investigation focussed on suspected undeclared income earned from a painting business. The investigation concluded that Mr Scott did not properly disclose his income for the years 2011 to 2013, during which time he paid income related rent.
[7] In December 2013 Mr Scott filed an application for income related rent for the upcoming year. He did not disclose the income from the painting business. The application was declined on the basis of the results of the investigation. In mid- February 2014 HNZC made the decision to increase Mr Scott’s rent from $51 per week to a market rent of $332 per week.
[8] Mr Scott lodged an appeal against the decision to increase his rent to the State Housing Appeals Authority on 28 February 2014. The appeal to the State Housing Appeals Authority was declined on the ground that it was lodged before HNZC internal review procedures were completed.
[9] Following the increase in rent, Mr Scott continued to pay rent at the old rate. On 7 March 2014 HNZC issued him with a notice terminating his tenancy, giving him 90 days (until 20 June 2014) to vacate the property.
[10] On 17 March HNZC wrote to Mr Scott informing him that it will review internally the rent increase and the question of whether Mr Scott owes any money
for back-payments of rent. The result of that review was to slightly decrease the debt owed by Mr Scott from $38,846 to $37,362.
[11] A number of legislative reforms took effect from 14 April 2014. As a result, the Ministry of Social Development took over from HNZC matters relating to income related rent. On 11 September the Ministry of Social Development wrote to Mr Scott informing him that it had reviewed his assessment for rental payments and concluded that he was entitled to income related rent dating from 21 February 2014.
[12] Following the issue of the termination notice on 7 March 2014, Mr Scott applied to the Tenancy Tribunal. He sought a declaration that the notice to terminate was retaliatory.
[13] The orders of the Tenancy Tribunal and that confirmed by the District Court have been stayed pending the disposal of the appeal. Mr Scott continues to live in the property at 35A Taipari Road, Maungatapu, Tauranga and pays income-related rent.
[14] The respondent also commenced criminal proceedings against Mr Scott. On
17 April 2015 he was found guilty on four charges of dishonestly using a document to obtain a pecuniary advantage, on the basis that he failed to declare income from his painting business in applications for income related rent. He is due to be sentenced on 24 June 2015.
The tenancy agreement
[15] The tenancy agreement is a standard HNZC agreement. Clause 1 provides:
The laws that cover your tenancy
1 Your tenancy with us is covered by the terms set out in:
· this Tenancy Agreement
· the Residential Tenancies Act 1986
· the Housing Restructuring and Tenancy Matters Act 1992 (this Act covers how income-related rent is granted and the social allocation of housing).
[16] Clause 2 provides:
If you have given us false or misleading information about your circumstances
2.We are giving you a tenancy in a Housing New Zealand home because of your housing needs. If you have given us false or misleading information about your housing needs, including all matters discussed during the needs assessment interview and allocation process, we can do any of the following:
§ end your tenancy (under the Residential Tenancies Act 1986)
§ investigate your circumstances (under the Housing Restructuring and Tenancy Matters Act 1992) and make you pay back any money we are entitled to recover
§ review your rent and change the amount of rent you have to pay
(under the Housing Restructuring and Tenancy Matters Act
1992) and make you pay back any money we are entitled to recover
§ begin criminal proceedings.
[17] Clause 3 provides:
If your circumstances change
3Your income-related rent is based on the current income and circumstances of your household. You must contact us every time your circumstances change. If you don’t let us know about any changes to your circumstances within 28 days, you may get into debt.
Legislative scheme
[18] Prior to 14 April 2014, HNZC had two roles as set out in Part 5 of the
Housing Restructuring and Tenancy Matters Act:
(a) as landlord to tenants in social housing; and
(b) The assessor of an individual’s eligibility for social housing and
entitlement to income related rent.
[19] Pursuant to the Social Housing Reform (Housing Restructuring Tenancy Matters Amendment) Act 2013, the second role is now vested in the Ministry of Social Development.
Relevant provisions: Residential Tenancies Act 1986
[20] The Residential Tenancies Act governs all residential tenancies and the relationships between the landlords and tenants. Section 11 provides that any agreement to which the Residential Tenancies Act applies and that is inconsistent with the Act shall be of no effect unless:
11. Act generally to apply despite contrary provisions
...
(a) the inconsistency, exclusion, modification, or restriction is expressly permitted by this Act; or
(b) the Tribunal is satisfied that, having regard to the nature of the tenancy, the provisions of the tenancy agreement, the interests of the parties, and all other relevant circumstances of the case, the inconsistency, exclusion, modification, or restriction should be permitted.
...
[21] Sections 50 to 54 deal with termination of tenancies. Section 50(b) provides that a tenancy may be terminated by giving notice of a period no shorter than that required by the Act or in the tenancy agreement. Section 51(1)(d) provides:
51 Termination by notice
(1) Subject to sections 52, 53, 53A, 59, and 59A, the minimum period of notice required to be given by a landlord to terminate a tenancy shall be as follows:
(a) where the owner of the premises requires the premises as the principal place of residence for the owner or any member of that owner’s family, 42 days:
(b) Where the landlord customarily uses the premises, or has acquired the premises, for occupation by employees of the landlord, that fact being clearly stated in the tenancy agreement, and the premises are required for occupation by such an employee, 42 days:
(c) where the owner is required, under an unconditional agreement for the sale of the premises, to give the purchaser vacant possession, 42 days:
(d) In any other case, 90 days.
[22] The Court of Appeal in Winther v Housing New Zealand Corporation held that a notice issued under s 51(1)(d) does not require the landlord to provide any reasons.1 The notice need only comply with s 51(3). There is no dispute in this case that the notice complied with s 51(3).
[23] Section 55 allows the Tenancy Tribunal, upon application by the landlord, to terminate the tenancy if the Tribunal is satisfied the rent is in arrears.
Relevant provisions: Housing Restructuring and Tenancy Matter Act 1992
[24] The relevant provisions of this legislation are those which were in existence prior to their repeal by the operation of the Interpretation Act 1999.
[25] Part 5 of the Housing Restructuring and Tenancy Matters Act set out provisions relating to income related rents and housing eligibility. Section 43 provided that income related rent may be granted to a tenant on terms. In particular, s 43(1) provided:
43 Income-related rent
(1) This subsection applies to HNZ housing and a tenant if—
(a) the tenant has applied to the company for it to calculate an income-related rent for the housing; and
(b) the Corporation is satisfied that—
(i) it has had all information reasonably needed to calculate such a rent for the housing for long enough to be able to do so; and
(ii) the information is accurate.
...
[26] Section 43(3) provided that if subs (1) did not apply to HNZC and a tenant, the rent for the housing must be its market rent. This means that rent for social housing could be either income related rent, or market rent. Where income related rent was not available because the tenant had not provided sufficient information,
market rent applied.
1 Winther v Housing New Zealand Corporation [2010] NZCA 601 at [53].
[27] Sections 57B to 61 were entitled “Investigations and information-gathering powers”. These sections allowed HNZC to investigate circumstances relevant to income related rent and continued eligibility for housing. Section 58A set out the actions HNZC was allowed to take while investigating these circumstances:
58A Actions that may be taken by HNZ
(1) HNZ may take the actions stated in subsection (2) if—
(a) any person whose circumstances it may investigate—
(i) fails or refuses to answer (or, in HNZ's opinion, fails or refuses to answer fully) any question asked under section 58(a); or
(ii) fails or refuses to verify any information by statutory declaration when asked to do so under section 58(b); or
(b) it believes on reasonable grounds that any person whose circumstances it may investigate under section 57B,57C, 57D, or 57E has deliberately given a false or misleading answer to any question asked under section58(a); or
(c) for the purpose of a review under section 57A, HNZ requires information from a tenant pursuant to section 59A, and—
(i) the tenant fails or refuses to comply fully with the requirement for information; or
(ii) HNZ believes on reasonable grounds that the tenant has deliberately given false or misleading information in response to the requirement.
(2) The actions are,—
(a) to the extent that the tenant is the person or people to whom any HNZ housing is let or to be let,—
(i) calculate an income-related rent for the tenant for that housing on the basis of HNZ's own understanding of the circumstances; or
(ii) treat the market rent for that housing as the income- related rent for the tenant for that housing:
(b) to the extent that the tenant is a prospective tenant only,—
(i) suspend the process of determining whether to allocate, assign, or let any HNZ housing to the prospective tenant; or
(ii) decline the tenant's application to become a tenant of
HNZ housing:
(c) to the extent that the tenant is an existing tenant only,—
(i) review the eligibility of the tenant to be or continue to be allocated, assigned, or let that particular HNZ housing on the basis of HNZ's own understanding of the circumstances; or
(ii) treat the tenant as not or no longer eligible to continue to be allocated HNZ housing:
(d) to the extent that the person is an applicant for, or recipient of, a financial product,—
(i) assess the eligibility of the person for that financial product on the basis of HNZ's own understanding of the circumstances; or
(ii) treat the person as not or no longer eligible for that financial product.
[28] The Housing Restructuring and Tenancy Matters Act provided review and appellate processes for tenants who were dissatisfied with any decisions concerning income related rent or housing eligibility. The review process was internal, and was conducted before the tenant could bring an appeal to an external appellate body. The review was two tiered:
(a) The matter was referred to the Review Office for Housing New Zealand so that an independent view of HNZC’s decision could be formulated.
(b) If that view disagreed with the tenant’s request, the matter was
referred to the internal Review Authority for a final decision.
[29] After the Review Authority made its own decision, the tenant was able to appeal to an external body pursuant to s 62 of the Housing Restructuring and Tenancy Matters Act. From 28 November 2013 to 13 April 2014, when s 62 was repealed, it provided:
62 Rights of appeal
(1) This section and sections 62A to 62C apply to–
(a) any decision or determination of HNZ made under this Part, the calculation mechanism, or Schedule 3 (other than a decision under section 43(4)) in respect of an income-related rent; and
(b) any assessment by HNZ of–
(i) the eligibility of any tenant to be, or to continue to be, allocated HNZ housing; or
(ii) the housing needs of any tenant.
(2) Nothing in this section and sections 62A t 62C, or in any regulations under section 63, limits or affects the rights of any tenant of HNZ housing or of HNZ under the Residential Tenancies Act 1986.
[30] The State Housing Appeal Authority was set up by s 63(1) of the Housing Restructuring and Tenancy Matters Act and reg 16 of the Appeals Housing Restructuring and Tenancy Matters (Appeals) Regulations 2000. Regulation 10(3) provided that where there was significantly different evidence before the Authority than was before HNZC, the Authority must refer the matter back to HNZC for reconsideration.
[31] Following the passing of the Social Housing Reform (Housing Restructuring and Tenancy Matters Amendment) Act 2013, the Ministry of Social Development took over the responsibility for assessing income related rent and allocating social housing. A new s 75 was inserted into the Housing Restructuring and Tenancy Matters Act, which I need not discuss for the purposes of this hearing because the legislation does not specifically apply.
[32] The termination of a tenancy following the reassessment of income related rent was discussed in Housing New Zealand Corporation v Davis in the context of which body has jurisdiction to determine the appeal from the decision to revoke income related rent.2 There HNZC terminated a tenancy on the basis of non-payment of rent. The tenant’s income related rent was reassessed, and she was to pay market rent, which she could not afford. She appealed the decision to assess her eligibility for income related rent pursuant to Housing Restructuring and Tenancy Matters Act.
Toogood J held at [61]:
2 Housing New Zealand Corporation v Davis (HC Auckland CIV-2011-404-3766, 7 November
2011.
It is important to note that the legislative scheme under the Residential Tenancies Act for the termination of a tenancy recognises the right of the landlord, as the owner of the property, to the timely termination of the tenancy where the statutory conditions have been met. It is not open to the Tribunal, or a District Court on appeal, to deny that right on grounds which are irrelevant to the exercise of the Tribunal's or the Court's jurisdiction. In this case, any adjournment of the proceedings before the Tribunal, or any deferment of a decision, could properly be granted only for reasons confined to the matters before the Tribunal. Ms Davis's challenge to the level of her rent was not a matter for the Tribunal or the Court.
[33] Arguably, as both allocation of social housing and assessments of income related rent belonged to the same aspect of HNZC’s role, appeals concerning one’s eligibility for either fall outside of the Tenancy Tribunal’s jurisdiction. It follows that Housing Restructuring and Tenancy Matters Act matters may not be ruled on by the Tenancy Tribunal.
Procedural history
[34] For the purposes of this appeal I deal with the Tenancy Tribunal’s declaration
in respect of the validity of the notice.
Validity of the notice
[35] In respect of the validity of the notice, the Tenancy Tribunal observed that by seeking to terminate the tenancy for the failure to pay rent, HNZC was effectively enforcing its decision to increase the rent payments. The Tribunal refused to review HNZC’s decision to increase rent, as that fell within the ambit of the Housing Restructuring and Tenancy Matters Act, citing Davis. As such, the Tribunal found that HNZC was entitled to issue the notice following the results of its investigation, as they undermined the purpose of income related rent.
Judgment of Judge Wolff, 22 January 2015
[36] Before Judge Wolff for Mr Scott it was submitted that cl 2 of the tenancy agreement, which provides HNZC with the right to terminate the agreement if Mr Scott gave false information about his “housing needs”, must be interpreted as requiring HNZC to go through the review process of the Housing Restructuring and Tenancy Matters Act before the 90 day termination notice is given. The Judge
rejected this argument on the basis that when the notice was issued, the appeal process was not yet underway, and to require HNZC to await the beginning and outcome of the appeal process, or to suggest that the appeal process can negate the notice would be to significantly depart from the requirements of the Residential Tenancies Act and the tenancy agreement.
[37] The Judge confirmed that the Tenancy Tribunal did not have jurisdiction to determine matters that fell within the Housing Restructuring and Tenancy Matters Act, and accordingly found that the Tribunal’s decision was correct both in fact and law.
This appeal
[38] Mr Scott now appeals the decision of the District Court and raised the two grounds earlier referred to. Mr Sharp submitted that the Housing Restructuring and Tenancy Matters Act review process applies to the tenancy agreement and that HNZC ought to first determine the tenant’s eligibility for social housing before it can issue a notice terminating the tenancy.
Application for leave to introduce evidence on appeal
[39] Mr Sharp applied under r 20.16 of the High Court Rules for leave to introduce fresh evidence on appeal. The evidence is the affidavit of Mr Scott dated
23 March 2015. Mr Sharp submitted that this evidence related to matters that have arisen after the decision appealed against was made and is relevant to the determination of the appeal.
[40] In the affidavit Mr Scott deposes that he had recently requested the Ministry of Social Development to provide him with alternative social housing. Mr Scott deposes that he was told his eligibility cannot be assessed and no alternative property may be found until after he vacates his current property, to which the proceeding relates.
[41] Rule 20.16 provides:
20.16 Further evidence
(1) Without leave, a party to an appeal may adduce further evidence on a question of fact if the evidence is necessary to determine an interlocutory application that relates to the appeal.
(2) In all other cases, a party to an appeal may adduce further evidence only with the leave of the court.
(3) The court may grant leave only if there are special reasons for hearing the evidence. An example of a special reason is that the evidence relates to matters that have arisen after the date of the decision appealed against and that are or may be relevant to the determination of the appeal.
(4) Further evidence under this rule must be given by affidavit, unless the court otherwise directs.
[42] HNZC does not formally oppose the application.
[43] I do not consider this evidence should be admitted. Firstly, I find no special reasons for receiving this evidence. Although Mr Scott made the inquiries after the District Court appeal, the same inquiries could have been made at any stage after the notice of termination was issued. However, the most important reason this evidence should not be received is because it is not relevant. It does not assist the Court in resolving the questions of law that arise in this case.
Appellant’s submissions
[44] Mr Sharp’s primary submission was that HNZC should have first formally determined Mr Scott’s eligibility for social housing, and then proceeded to determine whether to issue a notice of termination.
[45] The foundation of the argument is that the tenancy agreement incorporates s 58A(2)(c)(ii) of the Housing Restructuring and Tenancy Matters Act and the agreement as a whole should be interpreted consistently with that legislation. Mr Sharp submitted that:
(a) The terms of the tenancy agreement are inconsistent with HNZC’s ability to issue a notice of termination for Mr Scott’s alleged failure to provide accurate information about his income. In particular, cl 1 of
the tenancy agreement incorporates s 58A(2)(c)(ii) of the Housing Restructuring and Tenancy Matters Act, and accordingly s 62 of that Act applies and allows a tenant to review or appeal HNZC’s assessment of the tenant’s eligibility for housing;
(b)Clause 2 of the tenancy agreement must be interpreted on the basis that a decision on eligibility for social housing is made under s 58A(2)(c)(ii) of the Housing Restructuring and Tenancy Matters Act;
(c) Within the context of s 11 of the Residential Tenancies Act, the Housing Restructuring and Tenancy Matters Act procedure for assessing continuing entitlements to housing is inconsistent with s 51 of the Residential Tenancies Act;
(d)Clause 2 of the tenancy agreement and s 51 of the Residential Tenancies Act, when interpreted consistently, provide that a decision on eligibility for housing should be made only after the procedure in the Housing Restructuring and Tenancy Matters Act has been followed. To hold otherwise would allow HNZC to circumvent the Housing Restructuring and Tenancy Matters Act procedure for reviewing eligibility for housing, thereby depriving the tenant of his rights for a formal review or appeal under the Act.
[46] Mr Sharp submitted that the legislative scheme did not contemplate that a social housing tenancy could be terminated by HNZC on the basis of its own conclusions of the tenant’s past income without allowing the tenant an opportunity to challenge these views by a review or an appeal.
[47] In respect of the errors allegedly made by the Judge, Mr Sharp made the following submissions:
(a) the Judge was incorrect in the observation that Davis was an authority for the proposition that the Tenancy Tribunal has no jurisdiction on
matters falling with Housing Restructuring and Tenancy Matters Act.3
Counsel says that the Court in Davis stated that the appeal process against a decision about income related rent under the Housing Restructuring and Tenancy Matters Act was not relevant to the Tenancy Tribunal, which was limited to determination of rent arrears and correct procedures for terminating tenancies. Counsel says that this is different to Mr Scott’s position that an assessment for housing eligibility should be completed before a decision to terminate the tenancy is made.
(b)The Judge was incorrect in finding that the Winther proposition that the 90 day notice provisions under the Residential Tenancies Act cannot be departed from.4 He submitted that the Court of Appeal held only that the s 51 notice need not give reasons, and did not find that s
51 applies to every tenancy. He submitted also that Winther did not address the possibility where s 51 may be inconsistent with the terms of the tenancy agreement.
Respondent’s submissions
[48] Ms Paterson submitted that the decision to terminate the tenancy was a response to a finding by HNZC that Mr Scott has misled it in applications for income related rent and was not related to Mr Scott’s general eligibility for social housing.
[49] Ms Paterson submitted that Mr Scott’s appeal is based on the contention that HNZC’s responsibilities under the Housing Restructuring and Tenancy Matters Act at the time the termination notice was issued qualified and narrowed the scope of HNZC’s powers to act as a landlord under the Residential Tenancies Act.
[50] Ms Paterson submitted that Housing Restructuring and Tenancy Matters Act and Residential Tenancies Act are two separate pieces of legislation, and their
interaction is prescribed. She submitted that HNZC was not required to assess
3 Housing New Zealand Corporation v Davis, above n 2.
4 Winther v Housing New Zealand Corporation, above n 1.
Mr Scott’s eligibility for social housing before issuing a notice terminating the tenancy.
[51] Ms Paterson submitted:
(a) The Housing Restructuring and Tenancy Matters Act did not fetter
HNZC’s power under s 51(1)(d) of the Residential Tenancies Act;
(b)The Tribunal did not have the jurisdiction to rule the notice of termination invalid;
(c) Mr Scott’s argument is better characterised as a judicial review on the
grounds of unreasonableness.
[52] In respect of the first submission, Ms Paterson submitted that to interpret the tenancy agreement and the relevant legislation in the way contended for by Mr Scott would be to significantly constrain the ability of HNZC to act as a landlord. She submitted that for such an interpretation to be supported, it requires express statutory provisions, which are not present.
[53] Counsel submitted that there is nothing in the tenancy agreement that is inconsistent with s 51 of the Residential Tenancies Act and that would trigger s 11, or that is inconsistent with the Housing Restructuring and Tenancy Matters Act. She submitted that when HNZC issued the notice to terminate the tenancy, it was exercising its power as a landlord under the Residential Tenancies Act and under the tenancy agreement. She emphasised that the decision was based solely on the fact that Mr Scott defrauded HNZC, and that it had nothing to do with his general eligibility for social housing.
[54] In respect of Mr Sharp’s submission that s 58A of the Housing Restructuring and Tenancy Matters Act should be read as requiring HNZC to make a decision on eligibility for social housing before it issues a notice of termination, Ms Paterson submitted that s 58A is not relevant, and adds that the interpretation contended for by Mr Scott is incorrect. Counsel submits that s 58A relates to steps HNZC may take in
the course of an investigation into the tenant’s declared income and circumstances. That does not apply here because all steps taken by HNZC were taken after the conclusion of the investigation.
[55] Ms Paterson submitted that the Tenancy Tribunal did not have jurisdiction to find the notice invalid. She submitted that this is independent of any finding that may be reached on whether HNZC failed to comply with the Housing Restructuring and Tenancy Matters Act. She submitted that as Mr Scott’s case is based on the contention that the termination notice was a result of a failure to follow Housing Restructuring and Tenancy Matters Act processes, the case fell within the Housing Restructuring and Tenancy Matters Act and outside the jurisdiction of the Tenancy Tribunal, as found in Davis. Counsel submitted that in any case, the decision to issue the notice was not based on the Housing Restructuring and Tenancy Matters Act but was an exercise of a power under the Residential Tenancies Act. The Tribunal only had to satisfy itself that the notice was not retaliatory.
Analysis
[56] This case concerns the interplay between the Residential Tenancies Act and the Housing Restructuring and Tenancy Matters Act. The former governs all relationships between landlords and tenants in residential housing. The latter concerns only the allocation of social housing and entitlement to income related rent. The two Acts interact in a limited number of ways, and strictly as prescribed.
[57] The crux of the appellant’s case is how these Acts interact and the extent to which the tenancy agreement incorporates HNZC’s role as an assessor and distributor of social benefits.
[58] I consider that the tenancy agreement incorporates the provisions of the Housing Restructuring and Tenancy Matters Act only to the extent that a tenancy with a particular tenant is dependent entirely upon the tenant’s need for social housing, which includes the tenant providing honest and accurate information about his or her needs for social housing. All it means is that the HNZC’s (now former) role as an assessor and grantor of income related rent and social housing simply dictates the persons to which HNZC must then become a landlord. It however does
not mean that HNZC’s role as an assessor of social benefits usurps its role as a
landlord.
[59] I first address the arguments that the tenancy agreement incorporates ss 58A(2)(c)(ii) and 62 of the Housing Restructuring and Tenancy Matters Act.
[60] When s 58A was in force, it belonged to a group of provisions entitled “Investigations and information-gathering powers”. These sections gave HNZC powers to investigate certain circumstances relevant to income related rent or eligibility for social housing of current or prospective tenants. Section 58 allowed HNZC to ask any person whose circumstances were the subject of the investigation any questions it thought fit and could require that person to verify by statutory declaration any information provided. Section 58A was headed “Actions that may be taken by HNZ”. It allowed HNZC to take actions specified in subs (2) if it believed any person, including a current tenant, had given false or misleading information asked for under s 58. Section 58A(2)(c)(ii) in particular allowed HNZC to either review the eligibility of the tenant to that particular housing, or to treat the tenant as no longer eligible to continue to be allocated social housing generally. Nothing in the provision empowered HNZC to terminate a tenancy.
[61] Section 62 belonged to a group of provisions entitled “Appeals”. It allowed
the tenant to appeal any assessment of his eligibility for social housing.
[62] The placement of s 58A within a group of provisions aimed at the conduct of investigations and information-gathering powers suggests strongly that the actions HNZC was allowed to take under s 58A(2) were to be limited to actions taken during an investigation into the tenant’s circumstances. The decision to terminate Mr Scott’s tenancy was made after the investigation was completed.
[63] Moreover, Mr Scott’s case invites the Court to view the termination of the tenancy as a decision by HNZC to treat Mr Scott as no longer eligible for any social housing. There is however no basis for the Court to make that link. As a landlord HNZC may terminate tenancies for any reason – it is able to do so pursuant to s 51 of the Residential Tenancies Act. There need be no connection between a tenant’s
housing needs and the decision to terminate the tenancy. It could be that the particular property will be sold, or that the tenant caused damage to the property, or that the tenant’s circumstances have changed and will need to be relocated to another, more suitable property. In such cases the termination clearly has nothing to do with the tenant’s continuing need and eligibility for social housing. In the present case, the notice of termination was issued only after Mr Scott fell into rent arrears, and not after his eligibility for social housing was reassessed. His inability to pay the required rent has no bearing on his housing needs or eligibility to be allocated social housing. Indeed, there is no evidence that Mr Scott’s eligibility for social housing generally has yet been assessed. In the present case there is nothing to which s 58A(2)(c)(ii) can be applied.
[64] In light of the finding that the notice of termination was a result of rent arrears and not a decision by HNZC affecting Mr Scott’s eligibility for social housing, the appeal procedure under s 62 does not apply.
[65] I also agree with the finding of Judge Wolff that a finding to the contrary would depart significantly from the requirements of the Residential Tenancies Act and the Housing Restructuring and Tenancy Matters Act. To accept the argument that cl 2 of the tenancy agreement must be interpreted as if an action under s 58A(2)(c) had been taken would be to cause confusion between decisions actually made and actions that may have been, or may be, taken already or at some point in the future. That approach would be incorrect also because it asks the Court to operate on an assumption that a termination of a tenancy necessarily spells the end of one’s eligibility for social housing. As discussed above, that is not always the case.
[66] Additionally, such an approach would blur the boundary between HNZC’s role as a landlord and as an assessor of social benefits, where these two roles should remain as distinct as possible. As stated above, the tenancy agreement incorporates HNZC’s role as an allocator of social housing only to the extent that it directs HNZC which persons are eligible to become its tenants.
[67] For these reasons, ss 58A(2)(c)(ii) and 62 of the Housing Restructuring and Tenancy Matters Act are irrelevant, and should not be read into the tenancy agreement.
[68] I now consider the argument that within the context of s 11 of the Residential Tenancies Act, the Housing Restructuring and Tenancy Matters Act assessment process for the eligibility of social housing is inconsistent with s 51 of the Residential Tenancies Act. In other words, for Mr Sharp submitted that HNZC’s procedure for assessing his eligibility for social housing is inconsistent with HNZC’s right to terminate the tenancy by the issue of a 90 day notice, and that accordingly, certain parts of the tenancy agreement are of no effect. Mr Sharp however did not specify to which parts of the tenancy agreement this argument applies.
[69] As found above, HNZC has not yet assessed Mr Scott’s eligibility to continue to be allocated social housing. It is therefore unnecessary to consider this argument further.
[70] I also briefly address counsel’s argument that s 51 is inconsistent with the appeal provisions of the Housing Restructuring and Tenancy Matters Act, and that the Judge was wrong to apply Winther in this respect. Mr Scott seeks, in effect, to suspend the application of the Residential Tenancies Act until all Housing Restructuring and Tenancy Matters Act appeal procedures have been exhausted. That position is not supported by either legislation. The Residential Tenancies Act, including s 51, applies to all residential tenancies. If Parliament intended to curtail HNZC’s powers as a landlord pending a new assessment for eligibility for social housing, it would have provided so explicitly in the Residential Tenancies Act.
[71] Accordingly, the Judge was not wrong in law in finding that HNZC was not required to reach a decision on Mr Scott’s eligibility for social housing prior to issuing him with a notice of termination. Further, the Tenancy Tribunal was authorised to declare the 7 March notice valid
Result
[72] The appeal is dismissed.
Costs
[73] I understand that Mr Scott has been granted legal aid. In case there is a need for costs, they are reserved. If counsel consider an order is appropriate, memoranda
in support, opposition and in reply shall be filed and served at seven day intervals.
JA Faire J
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