Rotorua landlords who were charging “significant” rent have been ordered to pay more than $6000 in exemplary damages after their tenants were living in an “unhealthy and unsafe” home with a leaky roof and rotten decking.

The Tenancy Tribunal has found landlord Aquastar Holdings Limited breached the Residential Tenancies Act 1986 for a property in Rotorua.

The company’s sole director and shareholder is Jasu Mati Bhana. The landlord’s agent for this tenancy is her brother Stephen Bhana, according to the Ministry of Business, Innovation and Employment (MBIE).

Aquastar Holdings Limited was ordered to pay $6195 in exemplary damages and a $20.44 filing fee to MBIE.

Rotting flooring on the deck. Photo / Supplied

The tribunal issued a three-year restraining order - meaning Aquastar Holdings Limited cannot commit further unlawful acts - after determining it was an “experienced landlord” and there had been “insufficient regard” for addressing breaches, even when raised by MBIE’s Tenancy Compliance and Investigation Team.

The report said Stephen had received restraining orders for his own rental premises and adjudicator Rex Woodhouse had “no confidence” that ordering exemplary damages “would have any material influence in ensuring that no future breaches occur to this or other tenancies for this landlord”.

In September, Stephen was 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.

In February, he 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.

In May 2022, a Rotorua trust represented by Stephen and Jasu was ordered to pay more than $16,000 in damages and costs for having tenants in unsafe living conditions.

Aquastar Holdings Limited had applied for a rehearing in the Tenancy Tribunal and had also appealed the tribunal’s decision in the District Court for the latest case, MBIE said.

‘Unsecured’ roofing would ‘lift with the wind’

A hearing took place in Rotorua on November 27 and 28.

The tribunal report, between the MBIE chief executive and Stephen Bhana of Aquastar Holdings Limited, showed three tenants were charged $1000 per week to rent the upstairs premises of a “large house” which covered two levels.

The tribunal ordered suppression of the tenants’ names.

On June 23, 2023, a tenant complained to the Tenancy Compliance and Investigation Team.

Team inspectors visited the property on August 3 that year and identified problems including an “unsecured” section of garage roofing that “would lift with the wind”.

Other problems were a hole in the Perspex roofing in the entrance way, missing roof flashing, ceiling panels in a bedroom being “held up with wood”, ceiling panels in a second bedroom “sagging”, an “insufficiently sized” heat pump, absent and inoperative extractor fans in two bathrooms, and “rotting flooring” on the deck.

The report said the tenant raised these issues with the landlord “on a number of occasions to no avail”.

The ceiling panels in one bedroom were being held up with wood screwed on to the bottom of the panels. Photo / Supplied

The inspector raised these issues with the landlord. A response from Stephen and Jasu was received on August 31, 2023.

On November 28 the Tenancy Compliance and Investigation Team issued the landlord improvement notices and required stated defects be addressed by February 23, 2024.

The landlord confirmed receipt of the notice on December 6, 2023.

On March 1, 2024, the Tenancy Compliance and Investigation Team emailed the landlord to advise it had failed to comply with the improvement notice. Eighteen days later the landlord requested an extension to comply with the notice, which was declined given the deadline had passed.

That same day, the tenant confirmed none of the required work had been done.

A second inspection took place on March 21, 2024, where inspectors noted “some repair” to the Perspex roof but the work was described as being “of an unprofessional standard” and it continued to leak.

A third inspection took place on May 22, 2024. The inspector confirmed a heater had been installed but no further work had been done.

The ceiling panels in one bedroom were sagging. Photo / Supplied

On June 21, 2024, this application was filed with the tribunal.

A case conference was scheduled for July 30. The landlord applied for an adjournment which was “accepted at face value”.

The November hearing was scheduled.

On November 26, Jasu applied for an adjournment on the basis Stephen was unwell. It was declined.

She initially attended the hearing on November 27 and again requested the hearing be adjourned, and was again declined.

Jasu stated she had not received the file and did not know anything about the issues at the premises, which the tribunal did not accept.

The report said a copy of the file was provided to Jasu at the hearing, however, she left before any of the witnesses gave evidence or the chief executive’s representative presented the case.

Jasu was told the hearing would proceed in her absence and a decision would be issued.

The hearing proceeded on November 27 and Jasu did not return.

’Soft and spongy’ deck

The tenant said a hole in the Perspex roof meant the tiled floor became “saturated” when it rained. This was raised with Stephen who had someone fix the roof, but it still leaked.

The Bhanas put up wooden planks to support the “sagging” ceiling tiles, which were still in place.

The tenant said an element on the stove had never worked and this was raised a number of times with Stephen.

The deck had worsened during the tenancy, and the tenants no longer used it as it was “soft and spongy”.

Rotorua landlords Stephen Bhana and Jasu Mati Bhana have been ordered to pay $6195 in exemplary damages and complete extensive repairs to a property in Rotorua. Pictured is rotting flooring on the deck. Photo / Supplied

This was raised with Stephen, but no work had been done.

Stephen said the tenants would need to move out so he could fix the deck but that was in late 2023 and there had been no further communications about the deck.

A Tenancy Compliance and Investigation Team inspector said the general state of the house was “unmaintained” and “shocking”.

‘Intolerable’ living conditions

The tribunal found the landlord had not adequately maintained the Perspex roof, ceiling panels, stove, decking, and roofing, and breached the Healthy Homes Standards for heating and ventilation.

“The breaches are likely to be intentional,” adjudicator Rex Woodhouse said.

“All of these breaches have been identified by the inspectors and notified to the landlord, but the landlord has not addressed them in any adequate way.

“The effect for the tenants is that they live in a tenancy that leaks and will likely be cold and draughty, and otherwise does not have the features that they [are] paying significant rent to receive.”

The tribunal ordered the landlord to repair or replace the roof, ceiling panels, stove, deck, and bathroom extractor fans and install heaters by January 28.

If the landlord failed to comply with the order, the chief executive may have the work done and charge the landlord the costs of up to $20,000.

The tribunal acknowledged this was a “short time” but the issues were “well known” by the landlord and it would be “intolerable” for the tenant to continue living in premises that were “unhealthy and unsafe”.

The tribunal also found Aquastar Holdings Limited failed to comply with an improvement notice, failed to provide a compliant Healthy Homes Statement and failed to advise tenants the property’s insurance statement was available for review.

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.