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Gibbons, Thomas --- "The Tenancy Tribunal: tensions of jurisdiction, coherence and economics" [2012] OtaLawRw 4; (2012) 12 Otago LR 703

Last Updated: 16 April 2014

The Tenancy Tribunal: Tensions of Jurisdiction, Coherence, and Economics

Thomas Gibbons* I Introduction

The Tenancy Tribunal has, since 1987, had jurisdiction over residential tenancy disputes in New Zealand.1 In 2012 it celebrates its twenty-fifth birthday. Residential tenancies are an important part of New Zealand’s social landscape, and the Tenancy Tribunal is an important institution in the resolution of tenancy disputes.

Colloquially, it could be called both New Zealand’s most popular, and most unpopular, Tribunal. The Tenancy Tribunal is popular in that it sees a lot of hearings: in a recent Law Commission report, it was identified that the Tenancy Tribunal had over 21,000 applications filed in 2005–2006, more than any other New Zealand tribunal, including the Disputes Tribunal.2 This makes it New Zealand’s most “popular” Tribunal, and arguably the most common interface with the justice system for many citizens. That might seem to make it an obvious object for study, but actually the Tenancy Tribunal often seems quite unpopular. It has largely been ignored by scholars, and those that have devoted attention to this forum have recognised that it has been the subject of criticism from both landlords and tenants.3 While the Disputes Tribunal has been the subject of a number of academic studies,4 much less has been written about the Tenancy Tribunal.5 In addition, because lawyers do not have

* Director, McCaw Lewis, Hamilton. An earlier version of this paper was presented at the “Justice in the Round” conference held at the University of Waikato in April 2011, and I would like to thank the conference organisers and those who commented on the presentation at the time. I would also like to thank an anonymous reviewer for comments on an earlier draft.

1 Residential Tenancies Act 1986, ss 1(2) and 67.

2 Law Commission Tribunals in New Zealand (NZLC IP6, 2008) at 145; see

also Law Commission Delivering Justice for All (NZLC R85) at 159 (figures

for 2002–2003).

3 See Helena Harbrow “The Dilemma Facing Landlords and Tenants:

Enforcing Tenancy Tribunal Orders While Upholding Privacy Interests”

(2005) 36 VUWLR 581 at 588.

4 See, eg, Peter Spiller The Disputes Tribunals of New Zealand (2nd ed,

Brookers, Wellington, 2003); Peter Spiller “The changing face of the

Disputes Tribunal” [2009] NZLJ 94; Peter Spiller “The Small Claims

System: A Comparison of the South African Small Claims Court and the

New Zealand Disputes Tribunal” [1997] WkoLawRw 3; (1997) 5 Wai L Rev 35.

5 Harbrow, above n 3; Brian Davis “The Residential Tenancies Act 1986”

(1987) 17 VUWLR 244; Kenneth A Palmer “Residential Tenancies Act

1986” [1987] NZ Recent Law 235; and Diane Stephenson “The Residential

Tenancies Act 1986: A Progress Report” [1988] AukULawRw 6; (1988) 6 Auckland U L Rev 65

are among the few articles; though Andrew Alston Residential Tenancies

(3rd ed, LexisNexis, Wellington, 2003) is the key text, this book has been

an automatic right to appear in many Tenancy Tribunal matters,6 and perhaps also because the Tribunal has an ability to dispense with strict procedure,7 the Tribunal is largely ignored – and anecdotally perhaps often criticised – by lawyers as well.

In many instances, it seems more appealing for Tribunals to be studied at a macro level – as a Tribunal system, itself part of a Court system or a justice system – rather than at the level of individual Tribunals. This is the approach taken by the New Zealand Law Commission recently, for example, in its analysis of the coherence of New Zealand’s Tribunal system and the desirability of consolidation.8 There has been a range of similar scholarship overseas.9 In New Zealand, however, the Tenancy Tribunal seems so popular (that is, is involved in so many disputes, and potentially of so much importance to the interface of the general public with the justice system), that – in the first of many tensions identified in this paper – it is unpopular (unstudied, and seemingly left out of efforts to cohere tribunals). That is, it is something of the ignored elephant in the room.10

This article seeks to reverse this trend, by paying specific attention to the Tenancy Tribunal. In the next section of this paper, the Tribunal is placed within its context, with a number of case studies on jurisdiction then considered. While the contextual discussion highlights coherence among Tribunals as an important goal, the disparity of these case studies illustrates the challenges of coherence for the Tenancy Tribunal. They also illustrate that the Tribunal is likely to maintain – and probably extend – its role as the most common interface between citizens and the justice system.11

However, various complications of this expanded interface may further

irregularly updated (but see David Grinlinton Residential Tenancies: The

Law and Practice (4th ed, LexisNexis, Wellington, 2012)).

6 Residential Tenancies Act 1986, s 93(2).

7 Section 85.

8 See Law Commission Tribunals in New Zealand, above n 2.

9 See, eg, Michael Barker “The emergence of the generalist administrative

tribunal in Australia and New Zealand” (paper presented at

the Australian Institute of Judicial Administration Conference,

9–10 June 2005), available at <


10 There are other metaphors: “Tribunals are a forgotten part of a Cinderella

subject. Administrative law does not instil passion in the hearts of men

(or women), and within it, tribunals are an unfashionable quasi-legal

backwater.” W John Hopkins “Tribunal reform in New Zealand: Could

do better?” NZ Lawyer (Auckland, 20 February 2009), available at <www.


11 Lord Carnwath and others “An Overview of the Tribunal Scenes in

Australia, Canada, New Zealand and the United Kingdom” in Robin

Creyke (ed) Tribunals in the Common Law World (Federation Press, Sydney,

2008) 1 at 18.

contribute to uncertainty in Tribunal matters, ultimately amplifying the paradox of the Tribunal’s role as both New Zealand’s most popular and unpopular Tribunal. Drawing on these case studies, on tools from property theory and law and economics scholarship, comparative material, and practical issues arising from the Tribunal’s expanded jurisdiction, this paper argues that the Tribunal’s jurisdiction illustrates tensions of various kinds. It further argues that because of these tensions, only a limited degree of coherence has been achieved by grafting unit title disputes onto the existing jurisdiction of the Tenancy Tribunal, and that to achieve this coherence, greater attention to the foundations and implications of the Tribunal’s jurisdiction is needed.

II The Tenancy Tribunal: Overview and Reform

There are around 100 entities in New Zealand that can be called tribunals;12 the Tenancy Tribunal is one of these. While the term “tribunal” is not one of precise meaning, in New Zealand, as in Australia, the term is generally used to describe an institution fulfilling one or more of three functions: “reviewing administrative decisions or the executive decisions of government; making original administrative decisions; and resolving disputes in areas including consumer trading, tenancy and similar matters”.13 It has been emphasised that Tribunals “play a crucial role in the justice system, because for many New Zealanders a tribunal is their first and sometimes only contact with the justice system”.14

The Tenancy Tribunal was established pursuant to the Residential Tenancies Act 1986, and consists of a Principal Tenancy Adjudicator, and other Tenancy Adjudicators; each Tenancy Adjudicator must be a barrister or solicitor of the High Court of New Zealand (or hold an equivalent qualification), unless the Minister of Justice and Minister of Housing approve otherwise.15 The Residential Tenancies Act 1986 applies to most residential tenancies, with specific exceptions set out in the Act.16

The Tribunal has a broad jurisdiction in respect of residential tenancies, including to determine whether a residential tenancy exists, whether the Residential Tenancies Act 1986 applies to that tenancy, and whether a dispute exists between a landlord and tenant (or between a landlord and guarantor of a tenant).17 The Tenancy Tribunal also has the power to make a range of orders, including work orders; orders in the nature of a declaration; orders to yield possession of premises; and orders to set aside an agreement.18 As noted in the introduction, the Tribunal has a busy workload, receiving over 21,000 applications in the 2005–2006

12 At 9.

13 At 2.

14 At 2.

15 Residential Tenancies Act 1986, s 67.

16 Sections 4, 5, 5A, 5B.

17 Section 77(1).

18 Section 78(1).

year.19 Most of these disputes are initiated by private landlords because of a tenant failure to pay rent.20

The Residential Tenancies Act 1986, which governs the constitution and operation of the Tenancy Tribunal, has been subject to irregular reform. Significant amendments were passed in 1996 and, after a long gestation period, 2010,21 with a lesser amendment in 2011. The amendments passed in 2010, and the passage of the Unit Titles Act 2010, have had a significant impact on the jurisdiction of the Tribunal. These developments will be discussed in more detail later in this paper; at this point we turn to broader contextual developments, particularly the reform of Tribunals, both in New Zealand and overseas.

In New Zealand, tribunals have been described as “independent statutory bodies which follow relatively flexible procedures with a view to resolving disputes in selected areas of expertise”.22 The Tenancy Tribunal fulfils all of these criteria; on the second, it can be noted that it is empowered to dispense with strict legal procedure;23 on the third, it can be noted that the relevant area of expertise was residential tenancies, but this has now been expanded to include an entirely different area: the resolution of unit title disputes.24 More broadly, throughout the Commonwealth, a story can be told of Tribunals expanding after World War II, both in number and in scope. This has certainly been the case in Australia and New Zealand, and this phenomenon has been explained in a number of ways: as a reflection on the rise of the welfare state; as a response to the centralisation of government power; as a way for governments to be seen to be “doing something” about various issues; and as a way of streamlining and simplifying an increasingly complicated court system.25

More recently, however, Tribunal growth has been accompanied

– perhaps in something of a counterpoint – by a recognition that

the development of Tribunal systems has generally been piecemeal

and incoherent; and this has led to the view that there is a need for

streamlining, or consolidation, of Tribunal systems.26 Within this context,

it has been identified in New Zealand that while there are around 100

entities that can be called tribunals, “tribunals have emerged in an ad

19 Law Commission Tribunals in New Zealand, above n 2, at 145.

20 Harbrow, above n 3, at 588.

21 The Residential Tenancies Amendment Act 2010 had started life as the

Residential Tenancies Amendment Bill 2001.

22 Carnwath and others, above n 11, at 16.

23 Residential Tenancies Act 1986, s 85.

24 See section V of this paper, below.

25 See, eg, Carnwath and others, above n 11, at 9 (rapid growth of Tribunals

in Canada after World War II); Barker, above n 9, at 4–8 (referring to

growth of Tribunals in New Zealand and Australia after World War II,

mirroring developments in England); Philip A Joseph Constitutional and

Administrative Law in New Zealand (LawBookCo, Sydney, 1993) at 656.

26 See Carnwath and others, above n 11; Barker, above n 9.

hoc way and presently lack any coherent framework or settled pattern”.27

In relation to the Tenancy Tribunal, McConnell has noted that as part of

the drive for coherence:28

When new tribunals or disputes resolution processes are being proposed, consideration is to be given to integrating this work into an existing tribunal or tribunal grouping. A recent example of this is the proposal that the jurisdiction of the tenancy tribunal be extended to include the ability to deal with unit title disputes. Such disputes could be between unit owners or occupiers and the body corporate managing the complex or between the various owners. Rather than establishing a new tribunal it is proposed that the jurisdiction of the tenancy tribunal be extended to cover such disputes as the Tenancy Tribunal already deals with, including disputes between tenants in unit title properties and their landlords.

Arguably, this is more of an exercise in grafting than coherence, but grafting does help achieve the aim of streamlining tribunals. There are a number of supporters of the goal of coherence, though not all agree on the details. Most of these commentators have approached the issue of coherence from an administrative law perspective. Trevor Daya-Winterbottom, for example, has argued that there are “strong grounds” for reform of New Zealand’s tribunal system on the basis of administrative efficiency, but that there are “no compelling arguments for imposing a single solution on all specialist courts and tribunals”.29

Similarly, John Hopkins has welcomed reform that seeks to achieve the goal of coherence, on the basis that the existing system is too ad hoc, but has made a number of criticisms of the approach taken. Arguing that it is difficult to see any consistency in the notion of a “tribunal” in the various bodies identified by the New Zealand Law Commission, Hopkins makes the point that “tribunals have been treated as a single, discrete entity capable of being examined outside the wider context”, when they are within, rather than outside the wider legal system.30 Hopkins also observes that the proposed reforms “fail to focus sufficiently on the users of tribunals and their needs as a whole”.31

Hopkins looks briefly to costs aspects of coherence, but emphasises that “a greater socio-legal approach” to issues of Tribunal reform is needed. This paper does not argue otherwise, but it is submitted that as well as being a conceptual (or constitutional) goal, coherence is also an economic goal. Coherence is about making justice more streamlined and efficient, more simple and accessible, less cumbersome. Inasmuch as coherence seeks these goals, it clearly has a flavour which (as Hopkins recognises) is not just about human rights or administrative law considerations of

27 Carnwath and others, above n 11, at 16–17.

28 Patricia McConnell “The Future of Tribunals in New Zealand” in Robin

Creyke (ed) Tribunals in the Common Law World (Federation Press, Sydney,

2008) 194 at 200.

29 Trevor Daya-Winterbottom “Specialist Courts and Tribunals” (2004) 12

Wai L Rev 21 at 45.

30 Hopkins, above n 10.

31 Hopkins, above n 10.

aspects of access to justice; it is also a utilitarian flavour of efficiency. And efficiency, of course, is the language of economics. Put another way – Why seek coherence? Why not just have varying tribunals, with varying procedures, jurisdictions, and powers? When we ask questions like this, the economic implications of coherence become obvious: “[E]conomics is the science of rational choice in a world – our world – in which resources are limited in relation to human wants”.32 Tribunal resources are understood to be limited; therefore, choices about the use of these limited resources need to be made. But economics is not solely about efficiency or rational choice. Sir Ivor Richardson, a former President of the New Zealand Court of Appeal, has emphasised that as a field of study, economics is concerned with society’s use of limited resources. The development and application of legal rules necessarily affects the use of these resources. Both economics and law are also concerned with behaviour and economic analysis therefore has “an important role to play in a very wide range of cases”, particularly where a court is reviewing existing legal principles or considering alternative legal rules.33 While Posner has emphasised that economic analysis of law is a theory, not a description,34 and suggests we should not reject economic analysis of law entirely merely because we do not agree with the most aggressive economic conclusions,35 others have taken issue with Posner ’s hypotheses. Behavioural law and economics scholars, for example, have noted that the assumptions of traditional law and economics: 36

are sometimes useful but often false. People display bounded rationality: They suffer from certain biases, such as overoptimism and self-serving conceptions of fairness; they follow heuristics, such as availability, that lead to mistakes; and they behave in accordance with prospect theory rather than expected utility theory, People also have bounded willpower; they can be tempted and are sometimes myopic. They take steps to overcome these limitations. Finally, people are (fortunately!) boundedly self-interested. They are concerned about the well-being of others, even strangers in some circumstances, and this concern and their self- conception can lead them in the direction of cooperation at the expense of their self-interest (and sometimes spite, also at the expense of their material self-interest).

As the study of choice – whether rational or not37 – among scarcity,

32 Richard Posner Economic Analysis of Law (4th ed, Little Brown, Boston,

1992) at 3.

33 Ivor Richardson “Law and Economics – and Why New Zealand Needs

It” (2002) 8 NZBLQ 151 at 166, 173.

34 Posner, above n 32, at 17.

35 At 25.

36 Christine Jolls, Cass R Sunstein and Richard H Thaler “A Behavioral

Approach to Law and Economics” in Cass R Sunstein (ed) Behavioural

Law and Economics (Cambridge University Press, New York, 2000) 13 at


37 Posner himself has noted, “I happen to find it implausible and

counterintuitive the view that the individual’s decisional processes are

so rigily compartmentalized that he will act rationally in making some

economic analysis can also be seen as the study of incentives. Why are individuals, lawyers, and judges making certain choices? What incentives are created by particular legal and policy decisions? Are these positive incentives or not? If efficiency is one important element within the economic analysis of law, incentives are another. As has been said by those advocating the importance of economic tools to legal analysis:38

That incentives do have an effect on every activity should not be controversial for legal scholars. The study of law would be a paradoxical enterprise if individuals routinely ignored incentives. The very existence of law implies a belief that individuals do respond to incentives.

That incentives have an effect in every area of activity does not mean that individuals have complete knowledge and an infinite ability to process complex situations to ascertain with precision their incentives. Incentives have an effect regardless of rationality.

There is only a limited literature on the economics of jurisdiction, often emphasising particular aspects of jurisdiction, such as decisions of federal courts,39 or private international law.40 This paper is about the jurisdiction of the Tribunal in its many forms, not just economic aspects of jurisdiction. However, simple economic analysis forms various an important part of the discussion in this paper, alongside other non- economic considerations. The first case study, for example, is about the interface between the termination of a residential tenancy, Tribunal jurisdiction, property rights, and public law. It is to this case study we now turn.

III Uncertain Jurisdiction – Winther41

Residential tenancies disputes rarely reach appellate levels; Winther, however, was something of a special case, being a test case that generated

trivial purchase but irrationally when deciding to get married or evade income taxes or have three children rather than two or prosecute a lawsuit”. Richard A Posner The Economics of Justice (Harvard University Press, Cambridge (Mass), 1983) at 2.

38 Nicholas Leonidas Georgakopoulos Principles and Methods of Law and Economics: Basic Tools for Normative Reasoning (Cambridge University Press, New York, 2005) at 31. Incentives have received particular attention in the recent Freakonomics. Steven Levitt and Stephen J Dubner Freakonomics: A Rogue Economist Explores the Hidden Side of Everything (HarperCollins, New York, 2005).

39 See Eric A Kades “The Law and Economics of Jurisdiction” (2009) William

& Mary Law School Research Paper, available at <http://papers.ssrn.


40 See Michael J Whincop The Law and Economics of Jurisdiction in Private

International Law (University of Toronto, Toronto, 2000).

41 Winther v Housing Corporation of New Zealand [2011] NZCA 6011, [2011]

NZLR 825 [Winther]. Aspects of this discussion draw on Thomas Gibbons

“Residential Tenancies – Winther v Housing NZ Corporation” (2011) 14 BCB

123 and Thomas Gibbons “Case Note: Winther v Housing NZ Corporation

[2009] WkoLawRw 9; (2009) 17 Wai L Rev 126.

significant media interest and involving significant public law issues.42

The factual essence of the case is that Housing New Zealand Corporation

(“HNZ”) terminated three residential tenancies in Lower Hutt by notice

under s 51(1)(d) of the Residential Tenancies Act, which provides that a

landlord may give notice to a tenant to vacate premises on 90 days’ notice,

without reasons. However, attached to each 90-day termination notice

(allegedly by mistake) was a copy of an internal HNZ memorandum

stating the background to each tenancy and seeking approval for

termination – alleging that the appellants had breached subss 40(2)(b)

and (c) of the RTA by allowing the properties to be used for an unlawful

purpose, and permitting interference with the reasonable peace of the

landlord’s other tenants – and further alleging that the appellants were

partners of gang members charged with criminal activity.

The appellants sought an order in the Tenancy Tribunal that the 90- day termination notices were unlawful as their rights to freedom from discrimination and right of association protected by the New Zealand Bill of Rights Act 1990 (“NZBORA”) had been breached. A complaint was also made to the Human Rights Commission, but this was not pursued. When the 90-day notice expired, HNZ applied for possession orders under s 64 of the Residential Tenancies Act. The Tenancy Tribunal held that it had no jurisdiction to consider the lawfulness of the termination notices, and granted possession orders.43 Appeals to the District Court, and subsequently the High Court, were dismissed.44 The High Court refused leave to appeal, but the Court of Appeal granted special leave under s 120 of the RTA to hear certain questions of law.45 The possession orders were stayed, and the Attorney-General and Human Rights Commission granted leave to intervene. HNZ also rose a further jurisdictional issue – namely that pursuant to Part 1A of the Human Rights Act 1993, a breach of s 19 of NZBORA was to be determined by the Human Rights Review Tribunal, not the Tenancy Tribunal. There were three legal issues at hand, with two of these particularly focused on jurisdiction: namely, whether the Tenancy Tribunal had jurisdiction to determine whether HNZ’s decision to terminate the tenancies was based on unlawful discrimination; and if the decision to terminate was based on unlawful discrimination, whether the Tenancy Tribunal (or District Court or High Court) had the power to refuse a possession order.

T he C o u rt o f A ppea l’ s a na lys i s o f j u ris d ic ti o n o n unl aw fu l discrimination was a complicated one. The Court described its analysis

42 On these public law issues, compare Gibbons “Case Note: Winther v Housing NZ Corporation”, above n 41, and Dean Knight “Gangs, houses and rights” (21 October 2009) LAWS179 Elephants and the Law <www.>. Aspects of the public law issues are outlined in more detail in Winther v Housing New Zealand Corporation [2011] NZHRRT 18; and Hanna Wilberg “Exclusive jurisdiction for the HRRT?” [2011] NZLJ 419.

43 Winther, above n 41, at [6].

44 At [7].

45 At [8].

as one of statutory interpretation,46 but a number of varying statutory provisions were taken into account. Section 151(2) of the Human Rights Act 1993 (“HRA”) limited the application of the HRA in relation to Government actions; this provision initially had a sunset date of December 1999; an assessment of compliance in 2000 suggested the non- discrimination standard in the NZBORA was more appropriate to the public sector: and this was reinforced by the Human Rights Amendment Act 2001;47 HNZ was a body performing public functions under s 3 of NZBORA; after traversing ss 20I, 20J, 20K and 20L of the HRA, the Court noted that there was no breach of s 19 of NZBORA unless there was also a breach of the HRA.48 Under the Residential Tenancies Act, s 12 – relating to prohibited discrimination in tenancy matters – was amended in 1996, when s 12A was also added. The Court held that the intention of these amendments was to provide a “choice of procedures” for discrimination issues in tenancy matters.49

Ultimately, then, the Tenancy Tribunal did not have jurisdiction to consider whether there had been an act or omission by a public body amounting to discrimination in contravention of the HRA: s 20K of the HRA provided that an allegation of discrimination by a public sector agency was to be determined under the HRA, with no exceptions in relation to tenancy matters or otherwise. The public sector and the private sector were to be held to different standards of discrimination: Part 1A of the HRA prevailed over ss 12–12A of the Residential Tenancies Act, and the Tenancy Tribunal did not have jurisdiction to determine discrimination by a public body.50 However, ss 12–12A of the Residential Tenancies Act were not redundant: once contravention by a public body had been established, the Tenancy Tribunal could exercise remedies under the Residential Tenancies Act on the basis that an “unlawful act” had been established; and it continued to have jurisdiction in relation to tenancy discrimination by private individuals.51 In other words, if a tenant of HNZ believed there had been discrimination, the tenant should make a complaint and follow the processes in the HRA, as the Tenancy Tribunal could not make a determination of discrimination in relation to a public body such as HNZ. There was a difference between public and private landlords, but this reflected legislative choice preferring the HRA (and so the Human Rights Review Tribunal) for public sector discrimination matters.52

The Tenancy Tribunal, District Court and High Court had also concluded that the Tenancy Tribunal had no discretion to refuse a possession order under s 64; it was argued for the tenants that s 77 did give the Tribunal

46 At [25].

47 At [28]–[29].

48 At [37].

49 At [40].

50 At [39]–[42].

51 At [47].

52 At [48]–[50].

jurisdiction and discretion. The Court of Appeal agreed with the tenants’ view: s 64 could not mandate a possession order where, for example, the landlord had terminated the tenancy by unlawful discrimination, particularly where discrimination in contravention of the HRA was specifically stated to be an unlawful act. Rather, s 64 required that the landlord’s entitlement to possession be established before a possession order was made. If an unlawful act was established, the Tribunal could refuse a possession order. The Court noted that it was for the tenant to raise any discrimination issues.53

While the Court’s conclusion on this issue – that the Tenancy Tribunal did have power to refuse to make a possession order following a 90-day termination notice, if the decision to terminate contravened the HRA54

– seems reasonable and correct, the Court seems not to have dealt with the implications of this finding very well. The difficulties of jurisdiction are clearly indicated in certain comments of the Court:55

We have not overlooked s 64(2) of the RTA which provides that no possession order may be made more than three months after the date of termination of the tenancy. We also note that s 64(4) provides that a possession order is not capable of being filed in the District Court for enforcement purposes under s 106 of the RTA more than three months after the order is made. However, the HRRT has power to make interim orders designed to preserve the position of the parties until a final determination is made and the TT has jurisdiction for that purposes as well as under s 79 of the RTA. If necessary, an interim order could also be made by the High Court in judicial review proceedings. In these circumstances, an order could be made restraining the landlord from proceeding until a determination is made under the HRA on a complaint of discriminatory conduct. No doubt an interim order would only be made if the tenant were able to establish a serious issue to be tried and that the balance of convenience favoured the making of the order.

The Court of Appeal’s analysis suggests that a (public body) landlord may serve a 90-day termination notice, which does not require reasons. The tenant may then allege unlawful discrimination. The termination notice is effective – unless and until an order pursuant to the HRA is made. If it is, then the Tenancy Tribunal can take the view that an unlawful act has been committed and refuse a possession order. In technical terms, it seems that the tenancy will have been terminated, but no possession order granted, and unless the landlord can easily show that no unlawful act has been performed, the landlord may get out of time for enforcement. While the facts of Winther may be unlikely to be repeated, the Court of Appeal’s reasoning seems to create an incentive for termination issues to become more complicated, rather than less. Then again, perhaps this was a deliberate intention of the Court of Appeal, to ensure that organisations such as HNZ are held to a high standard. With a private landlord, the Tenancy Tribunal can find discrimination of its own accord (without the

53 At [79].

54 At [81].

55 At [80].

HRA process needing to be followed), and so determine the efficacy of

the notice and the appropriateness of a possession order.

IV Of Winther, Personhood, Property and Bundles

The Court of Appeal in Winther made three key findings: most notably, that the Tenancy Tribunal did not have jurisdiction to determine whether a public sector landlord’s decision to terminate a tenancy was based on unlawful discrimination: that question needed to be determined under the Human Rights Act 1993; and also, if the termination of a residential tenancy did contravene Part 1A of the HRA, and an unlawful act had thereby been committed, the Tenancy Tribunal had power to refuse a possession order. Here, a possession order was correct, as there was no finding of discrimination pursuant to the HRA, and the 90-day notices were valid and effective.56

It is difficult to read Winther without considering the work of Margaret Jean Radin, who has prominently associated property with personhood,57 and has argued that a residential tenant has a personhood-based property interest in his or her tenancy, while the landlord’s interest is often more fungible, or replaceable. That is:58

the private home is a justifiable form of personal property, while a landlord’s interest is often fungible. A tenancy, no less than a single- family house, is the sort of property interest in which a person becomes self-invested; and after the self-investment has taken place, retention of the interest becomes a priority claim over curtailment of merely fungible interests of others.

Following Radin’s argument, it is difficult to see the interest of Housing New Zealand as anything other than fungible. Does this necessarily make a tenant’s interest a personal interest, a property interest? This is a matter unexplored in the Winther judgment. But Radin makes a further point: 59

It is widely said that the law of residential tenancy has undergone a revolution. The ordinary common law property scheme of landlord and tenant was caveat tenant, and the scheme largely prevailed as little as thirty years ago. Then came the revolution. .... It is obvious that the landlords have lost a lot of the “sticks” in their “bundle” and the tenants have gained a lot in theirs.

Radin is referring to the notion of property as a “bundle of sticks”, or a “bundle of rights”. In broad terms, the metaphor emerged in the late

56 See Gibbons “Residential Tenancies – Winther v Housing NZ Corporation”, above n 41. It needs to be noted that the Court of Appeal decision was not the end of the matter, as matters proceeded to the Human Rights Review Tribunal: see Winther v Housing New Zealand Corporation [2011] NZHRRT

18; Wilberg, above n 42.

57 See Margaret Jane Radin “Property and Personhood” (1982) 34 Stan L

Rev 957.

58 Margaret Jane Radin Reintepreting Property (University of Chicago Press,

Chicago, 1993) at 84.

59 At 172–173.

1800s,60 and has endured, particularly in the field of law and economics,61 though has recently come to face increasing challenges from those who favour more exclusionary theories of property, including new metaphors based around “agenda setting”62 and “modular architecture”.63 The “bundle” metaphor has been described in a number of ways. Sociologists have referred to the work of Henry Maine, and his description of property rights as “a bundle of powers, capable of being mentally contemplated apart from one another and capable of being separately enjoyed”,64 which can be seen as something of a forebear of Honoré’s later analysis of the various incidents of ownership.65 Others of Maine’s time described property “not a single absolute right, but a bundle of rights”.66 A bundle of rights is, of course, quite different to the notion of property as a “thing”,67 though “property as the law of things” is an idea whose time may yet return.68

One of the criticisms of the “bundle of rights” idea is the notion that this idea is too malleable. As Penner has written: 69

on the “bundle of rights” picture, “property” is not really a useful concept of any kind .... [I]t doesn’t effectively characterize any particular sort of legal relation. Property is pictured as a bundle of different rights, such as the right to possess, the right to use, the right to consume, the right to destroy, the right to manage, the right to give, the right to lend, the right to sell, and so on. Property, it is supposed, is a kind of aggregate or complex composed of more basic elements. One has property when one has some number of these rights, although it has proved exceedingly difficult to say

60 See, eg, Daniel B Klein and John Robinson “Property: A Bundle of Rights?” (2011) 8 Econ Jnl Watch 193 at 194; Sarah Blandy, Jennifer Dixon and Ann Dupuis “Theorising power relationships in multi-owned residential developments: Unpacking the bundle of rights” (2006) 43 Urban Stud


61 “From a legal perspective, property is a bundle of rights”. Robert Cooter

and Thomas Ulen Law and Economics (2nd ed, Addison-Wesley, Reading

(Mass), 1997) at 72 (emphasis in original).

62 Larissa Katz “Exclusion and Exclusivity in Property Law” (2008) 58 U

Toronto LJ 275.

63 Henry E Smith “Property as the Law of Things” (2012) 125 Harv L Rev

1691. For further criticism, see JE Penner The Idea of Property in Law

(Clarendon, Oxford, 1997).

64 HS Maine Village-communities in the East and West: Six lectures delivered at

Oxford (John Murray, London, 1881), cited in Ann Dupuis “Law, Power

and Practice in Multi-Owned Housing: The International Experience”

(paper presented at the Strata and Community Title in Australia for the

21st Century 2011 Conference, September 2011, copy on file with author)

at 4–5.

65 AM Honoré “Ownership” in AG Guest (ed) Oxford Essays in Jurisprudence

(Oxford University Press, Oxford, 1961) 107.

66 John R Commons The Distribution of Wealth (Macmillan, London, 1893)

at 92, cited in Klein and Robinson, above n 60, at 196.

67 At 194.

68 See Smith, above n 63.

69 Penner, above n 63.

with any certainty whether some rights are essential, or whether a certain critical number are. It is not even clear there is any workable notion of “enough” rights to make up a property bundle.

The Winther decision is many things: following the language of Butler,70 it is a “public law case” dealing with public law issues in the context of what would otherwise be a private arrangement; it shows a narrowing of Tribunal jurisdiction and the importance of personal property over fungible property; and shows, following Radin’s line of argument, a further shift in the bundle of rights attaching to a residential tenancy from landlords towards tenants. It also points to the complex incentives relating to the overlay of termination provisions with Human Rights Act issues. It can easily be seen as a case about personhood, but more than anything, perhaps, it shows that jurisdictional issues for the Tribunal can be engimatic, and difficult to contain.

V Expanding Jurisdiction – Part 1

While Winther can be seen to represent a narrowing of the Tenancy Tribunal’s jurisdiction, legislative reform has expanded it in other directions. This part of the paper considers three areas of expansion under the Residential Tenancies Amendment Act 2010: a higher monetary limit for tenancy matters; an expansion into the oversight of boarding houses; and a more detailed jurisdiction in respect of the termination of tenancies. These illustrate various issues of economics and personhood, as well as augmenting Radin’s points about the shifting bundle of rights.

The Residential Tenancies Amendment Act 2010 substantially increased the Tribunal’s monetary jurisdiction, from $12,000 to $50,000.71 This was a significant increase, allowing the Tribunal to be able to determine a range of matters that formerly needed to be dealt with in the District Court. By way of comparison, the Disputes Tribunal jurisdiction has recently been increased to $15,000 (or $20,000 by agreement).72 This increase in the monetary limit of the Tribunal is likely to increase the number of disputes it hears, amplifying its role as New Zealand’s most popular Tribunal.

The Residential Tenancies Amendment Act 2010 also gave the Tribunal a new jurisdiction over boarding houses. Pursuant to this amendment, a “boarding house tenancy” is one that lasts for 28 days or more (or is intended to), and under which the tenant has exclusive rights to particular sleeping quarters and shared use of facilities in a boarding house; while a “boarding house” means residential premises occupied (or intended to be occupied) by at least six tenants at a time, and containing one or more boarding rooms along with facilities intended for communal use.73 In addition to other requirements in s 13A of the Residential Tenancies Act

70 Andrew Butler “Is this a Public Law Case?” (2000) 31 VUWLR 747.

71 Residential Tenancies Act 1986, s 77(5), as amended by the Residential

Tenancies Amendment Act 2010.

72 Disputes Tribunals Act 1988, ss 10 and 13.

73 Residential Tenancies Act 1986, s 66B.

in respect of tenancy agreements, a boarding house tenancy agreement must comply with a range of additional matters, and house rules must be provided to the tenant.74 Given the termination issues that arose in the Winther decision, we can note that a boarding house tenancy is – at least in theory – easier to terminate than an ordinary tenancy. That is, a landlord may terminate a boarding house tenancy immediately, if there is serious damage, danger to people or property, or serious disruption to other tenants (or the threat of these); on 48 hours’ notice, if the premises are being used illegally, the landlord believes the premises have been abandoned, or the rent is in arrears and prior notice has obeen given; on

14 days’ notice, if the boarding house tenancy is also a service tenancy; or on 28 days’ notice, without reasons. However, no doubt proper procedure on termination remains important.

In other respects, the 2010 Amendment Act has made termination more complex and complicated than ever. We see – in the substitute s

62 and the new ss 62A–F of the Residential Tenancies Act – legislation at the level of extreme detail, and it is easy to surmise that this level of detail will create further work for the Tenancy Tribunal. Under s

62, if a tenant leaves behind foodstuffs or perishable items following termination, the landlord may dispose of these immediately. However, if non-perishable and non-food items are left behind, the landlord must “make all reasonable efforts” to contact the tenant about collection. This phrasing suggests a relatively onerous standard is imposed on the landlord; and further, even if the tenant is uncontactable or does not collect the goods, the landlord must look after personal documents of the tenant and, in relation to other goods, follow s 62A or s 62B. Under s 62A, the landlord may deal with these other goods by making “all reasonable efforts” to assess their market value.75 If the assessed value is less than the cost of storing, transporting and selling the goods, the landlord may immediately dispose of them. If the value is above this threshold, the goods must be secured in “safe storage” for at least 35 days from when the landlord took possession of them. The tenant may claim the goods and any personal documents within this period, though the landlord may require reimbursement of reasonable costs. After 35 days,

74 No house rule may be inconsistent with the Residential Tenancies Act or permit any breach of the Human Rights Act 1993 or the Privacy Act

1993. House rules may only be amended with seven days’ written notice being given to tenants. A tenant may apply to the Tribunal for an order declaring house rules unlawful; the Tribunal may require the rule to be applied in a particular way, or set it aside or vary, and a landlord failing to comply with such an order of the Tribunal commits an unlawful act. See Residential Tenancies Act 1986, ss 66O–66P.

75 This places an onus on the landlord: suppose an item of clothing is left: an old sock will have minimal value, but a branded jacket may require the landlord to take proactive steps – remembering that the landlord’s obligations are created by the tenant’s action or neglect. We can imagine a difficult tenant leaving items behind deliberately to create work for the landlord.

the landlord may continue to store the goods; or deposit any personal documents with the police and sell other goods by auction (or private contract as a reasonable market price): if sold, the landlord may apply for an order as to what proceeds are to be paid to the landlord. In particular fact situations, the phrase “personal documents” may be troubling: a bank statement, a personally inscribed book, and a child’s drawing could each be personal – both for the purposes of the legislation, and in Radin’s sense of being non-fungible. Alternatively, under s 62B, the landlord may apply to the Tribunal for an order for disposal of goods, including personal documents; in which case the Tribunal must order either the return of goods to the tenant, or if that is not practicable, for the sale or other disposition of the goods: the order may be conditional, and must state what of the proceeds are to be paid to the landlord. The landlord’s storage, transport and sale costs (reasonably incurred), or a Tribunal’s order for payment to the landlord, may be deducted from the proceeds of sale, with the balance paid to the Tribunal but reclaimable by the tenant.76

The emphasis in this section of the paper has been on how certain changes effected by the Residential Tenancies Amendment Act 2010 expand the jurisdiction of the Tribunal, whether explicitly – as in the case of a higher monetary limit for disputes – or implicitly – as in the case of the greater attention that can be paid to landlord behaviour under the new provisions as to abandonment. The last of these, in particular, serves to illustrate a greater regulation – surveillance, almost77 – of landland behaviour, as well as the complications that arise when a tenancy is terminated.

Turning to Radin, in her advocacy of the importance of recognising personal property, and in her recognition of the shifting bundle of rights from landlord to tenant, we can suggest that she would welcome these developments. But returning to incentives, we can see that while there is a requirement for landlords to take care of tenants’ possessions (which might be seen as entirely proper), there is also something of an incentive for tenants to be careless, knowing a landlord must properly look after their goods, even if the tenancy has been terminated. So while the Tribunal’s jurisdiction has been expanded, achieving the efficient termination of a residential tenancy has become more complicated for landlords. In simple terms, these new provisions clearly illustrate a tension between economic and personhood considerations.

76 Residential Tenancies Act 1986, s 62C; on Radin, see above n 58.

77 Though some will blink at the suggestion, what comes to mind is the

work of Michel Foucault. See Michel Foucault Discipline and Punish:

The Birth of the Prison (Pantheon Books, New York, 1977), cited in Sharif

Shawki “Surveillance and Foucault: Examining the Validity of Foucault’s

Notions Concerning Surveillance through a Study of the United States

and the United Kingdom”, available at <http://digitalcommons.iwu.

edu/socanth_honproj/23/>; Alan Hunt and Gary Wickham Foucault and

Law: Towards a Sociology of Law as Governance (Pluto Press, Chicago, 1994)

at 57.

VI Expanding Jurisdiction – Part 2

It was noted in the discussion of consolidation above that unit title disputes were to become part of the Tenancy Tribunal’s jurisdiction. This can be seen as part of this drive for coherence, and also as part of a need for an appropriate forum for the effective resolution of body corporate disputes. The Unit Titles Act 1972, now repealed,78 did not provide for any specialist dispute resolution forum. Most disputes have been resolved in the High Court.79 On at least one occasion, argument arose as to whether the Disputes Tribunal should have jurisdiction;80 in another prominent – perhaps infamous – case, a dispute over whether a Rhodesian Ridgeback dog was a “small domestic pet” went to the High Court, though in that case judicial review was sought, so the dispute became about the exercise of statutory powers rather than the substantive dispute.81 It has been noted overseas that “there is little research or critique of the kinds of dispute resolution schemes set up to deal with conflict” among bodies corporate.82 This section aims to help remedy this difficulty within the New Zealand context.

The problems of dispute resolution under the Unit Titles Act 1972 were one of the issues deemed to require attention when this Act was being reformed,83 and the Unit Titles Act 2010 emerged with a three-tier process for dispute resolution, beginning with the Tenancy Tribunal. Despite being canvassed for some time, this jurisdiction has been described as “controversial” by some legal commentators.84 Among the reasons that might be advanced are that the Tenancy Tribunal has previously dealt with residential tenancies, while unit title matters can relate to residential, commercial, industrial, community and mixed-use developments. Put another way, the fact that people living in residential apartments have had unit title difficulties does not mean that issues facing unit title owners are necessarily residential. And while residential tenancy disputes are necessarily between a landlord and a tenant, unit title disputes can easily

  1. Section 218 of the Unit Titles Act 2010 repealed the Unit Titles Act 1972, but s 220 provided that certain provisions could remain in place until

30 September 2012.

79 See, eg, the cases noted in Thomas Gibbons Unit Titles Law and Practice

(LexisNexis, Wellington, 2011) at 101–146.

80 See Body Corporate 324537 v Prime Resources Company Ltd DC Auckland

CIV-2009-004-1653, 15 June 2010.

81 Godoy v Body Corporate 164980 HC Auckland M1906/98, 14 June 1999.

82 Rebecca Leshinsky and others “Dispute Resolution under the Owners

Corporation Act 2006 (Vic): Engaging with conflict in communal living”

(2012) 2 Prop L Rev 39 at 41.

83 See Glaister Ennor and Auckland Regional Council The Unit Titles Act

1972: The Case For Review Discussion Report (Regional Growth Forum,

Auckland, 2003) at 26; Department of Building and Housing Options for

Change: Review of the Unit Titles Act 1972 Discussion Document (Department

of Building and Housing, Wellington, 2006) at 22–23; Thomas Gibbons

“Unit Title Reforms” [2006] NZLJ 291.

84 John Greenwood “Unit Title Regulations passed: Act comes into force

this month” Council Brief (Wellington, June 2011) at 6.

be multi-faceted, as indicated by the range of parties who may bring a dispute (described below). Further, unit title matters are often seen as particularly complex – “lawyers’ law”85 – and therefore unsuited to a more informal forum such as the Tenancy Tribunal.

That said, a number of points could also be made in counterargument. The kinds of disputes that need to be resolved – such as in relation to the status of Rhodesian Ridgebacks – can be seen to support the view that a lower-level forum than the High Court is required. Tenancy Tribunal adjudicators invariably have legal training, and specialisation should ensure they achieve strong knowledge of this area in a short period of time: they could well be more specialised than most judges.86 The Residential Tenancies Act also provides a useful framework for procedure (including flexible procedure) that fits well with the desired level of informality for disputes between neighbours; and encapsulating unit title disputes within an existing Tribunal is consistent with the desirability of streamlining Tribunals, as outlined above.

It is worth setting out the foundations of the Tribunal’s jurisdiction, as set out in s 171 of the Unit Titles Act 2010:

171 Jurisdiction of Tenancy Tribunals

(1) Except as provided in this section, a Tenancy Tribunal (a Tribunal) constituted under section 67 of the Residential Tenancies Act 1986 has jurisdiction to hear and determine all disputes arising between any persons of the kind listed in subsection (2) in relation to a unit title development (a unit title dispute).

(2) The persons mentioned in subsection (1) are—

(a) the owner of a principal unit or a former owner of a principal unit:

(b) a future development unit owner:

(c) an occupier of a future development unit:

(d) a body corporate:

(e) an administrator:

(f) a registered valuer:

(g) an occupier of a principal unit:

(h) a service contractor:

(i) a prospective buyer of a principal unit:

(j) an original owner:

(k) a lessor of base land:

(l) the chief executive.

(3) Any person listed in subsection (2) may, by notice in writing to the Tribunal, appoint an agent to act on his or her or its behalf in relation to a dispute.

(4) The Tribunal does not have jurisdiction—

85 See Thomas Gibbons “The Unit Titles Act 2010” (2010) 14 BCB 25.

86 See, eg, Anthony Grant “How others see us: A need for judicial

specialisation” NZ Lawyer (Auckland, 14 May 2010), available at <www.


(a) to make an order requiring any person or body to pay any sum, or to do any work to a value, or otherwise incur expenditure, in excess of $50,000; or

(b) to hear a dispute relating to the application of insurance money under section 136(4); or

(c) to hear any dispute relating to the title of land.

(5) Without limiting subsection (4)(c), a dispute relating to the title of land includes—

(a) a redevelopment:

(b) cancellation of a unit plan:

(c) conversion under subpart 3 of this Part.

(6) An order of the Tribunal that exceeds any restriction specified in subsection (4) is of no effect.

(7) Subsection (4)(a) does not prevent a party to a unit title dispute from abandoning as much of the claim as exceeds $50,000 in order to bring the claim within the jurisdiction of the Tribunal; and in any such case, an order of the Tribunal in relation to the claim operates to discharge any person against whom the claim is made and the subsequent order made from liability in respect of the amount abandoned.

(8) The Tribunal has jurisdiction to hear and determine any claim arising under any unit title dispute that is a claim for the balance, not exceeding $50,000, after a set-off or any counterclaim made by the other party to the dispute against the claimant arising out of the same dispute, being a counterclaim admitted by the claimant.

(9) A cause of action must not be divided into 2 or more claims for the purpose of bringing it within the jurisdiction of the Tribunal.

It is clear from this outline that the Tribunal has a monetary jurisdiction for unit title disputes of up to $50,000, consistent with its expanded jurisdiction under the Residential Tenancies Amendment Act 2010, but cannot hear disputes beyond this monetary amount, or in relation to the application of proceeds under a body corporate’s principal insurance policy, or in relation to “title of land”.

This last point (“title of land”) is likely to be most contentious. Though some examples are set out in s 171(5), it might be considered that:

• The deposit of a unit plan leads to the creation of new titles.

• The interpretation of an easement or covenant concerns a matter

recorded on, and so affecting, a title.

• Consent to the creation of a layered development involves the creation of new titles.

• Certain body corporate rules may effectively be matters of title:87 therefore, since the provisions allowing for body corporate operational rules are very similar, matters in body corporate operational rules may, in some circumstances, also be matters of

87 See Rod Thomas “Fifer, Unit Titles and No 8 Wire” [2006] NZLJ 152 at


title. Body corporate operational rules are, after all, recorded on

certificates of title.88

• The attempted sale of an accessory unit independently of a principal unit.

• The sale of common property, which involves the deposit of a new unit plan, and so various consents for those with registered interests on titles.

Deciding what is and is not a matter relating to “title of land” is likely to be a very difficult issue: it may well require a High Court decision (or, following Winther, a judgment of the Court of Appeal) to determine what the Tenancy Tribunal can deal with. Differing approaches include the notion that a matter relating to “title of land” is a matter that could be requisitioned in the context of a transaction for sale and purchase of land;89 or that matters registered or noted on a certificate of title are matters of title;90 including, for unit titles, matters noted on a supplementary record sheet.91 That said, it is likely that the Tribunal will be able to deal with a range of issues, though not all are clear-cut.92

VII Jurisdiction: Economics, Public Law, and Challenges

The broad nature of the kinds of issues that the Tribunal may deal with under the Unit Titles Act 2010 might suggest that this new jurisdiction will make the Tribunal even more “popular” than before. However, one consideration that will inhibit the scope of this jurisdiction – beside the

88 Elizabeth Toomey “A Matter Relating to Title in the Unit Titles Act

2010: What Does this Mean?” (paper presented at Tenancy Tribunal

Adjudicators’ Conference, Auckland, September–October 2010, copy on

file with author) at 12 suggests that the Tribunal can interpret rules, but

not alter rules, as this would involve changing the supplementary record


89 See Bruno Bordignon and others The Unit Titles Act 2010 (New Zealand

Law Society, Wellington, 2011) at 74; for matters that can be requisitioned,

see DW McMorland Sale of Land (3rd ed, Cathcart Trust, Auckland, 2012)

at [9.09].

90 See Toomey, above n 88, at 7.

91 At 7.

92 A number of these are set out in Gibbons, above n 79, at 89–90. For

example, incorrect disclosure of information relating to the sale of unit

title property is within this list, but review of disclosure is a difficult

issue: suppose that a declaration as to incorrect disclosure is sought.

An order that disclosure has not been made properly does not of itself

require a payment of $50,000 or more, and so would appear to be within

the Tribunal’s jurisdiction. However, the consequence of this kind of

order might be that a contract for the sale of a unit can be cancelled

(see Unit Titles Act 2010, s 151), which might well then have a financial

impact over $50,000 and so outside the Tribunal’s jurisdiction. One way

of approaching this issue might be that the Tribunal has jurisdiction to

make a declaration that disclosure has not been made properly; but that

any party wishing to enforce any action in reliance on this declaration

would have to pursue matters in another forum.

inherent uncertainty of phrases such as “title of land” – is the expense involved in a Tenancy Tribunal application for a unit title dispute. While the cost of a residential tenancy claim in the Tribunal is only $20.44,93 the costs of a Tenancy Tribunal application for a unit title matter are either $850 or $3,300, depending on the nature of the matter. Whether popular or unpopular, the Tenancy Tribunal can, in the context of unit title disputes, also be seen as New Zealand’s most expensive Tribunal.94

Justice inevitably has a price, but the economics of this pricing deserve greater attention.

In an example of lawmaking by regulation, the Unit Titles (Unit Title Disputes – Fees) Regulations 2011 divide unit title disputes subject to Tenancy Tribunal jurisdiction into two kinds: a distinction that appears nowhere in the Unit Titles Act. These two categories are:95

• Category 1 proceedings, where a dispute is of “average or high complexity” and likely to involve a Tenancy Tribunal hearing, involve an application fee of $3,300. Without limitation, these include disputes relating to:

i) The repair or maintenance of common property;

ii) The governance of the body corporate; or

iii) The decisions and procedures of a body corporate.

• Category 2 proceedings, where a dispute is of “a straightforward nature”, and because of low complexity, is seen as likely to be resolved by mediation, involve an application fee of $850. Without limitation, these include disputes relating to:

i) Day-to-day management of a unit title development;

ii) An owner or occupier ’s behaviour that affects other unit

owners or occupiers; or

iii) Non-compliance with body corporate operational rules. This categorisation is problematic, a point illustrated by what appears to

be a late addition: clause 6(6) provides that levy collection, even though it

may involve a hearing, is in category 2.96 There is also a concerning degree

of uncertainty about the categorisation: the repair and maintenance of

common property is stated to be a category 1 matter, though it would

also seem to fall within the day-to-day management of a unit title

development, which is a category 2 matter. In some cases, the Tenancy

Tribunal may itself have to rule on the categorisation of a dispute, before

it is determined whether the dispute is within its jurisdiction or not.

With unit titles, as with issues around tenancy termination, the Tenancy

Tribunal may well find its jurisdiction both challenging and challenged.

While coherence was described above as primarily a conceptual goal of

93 Residential Tenancies (Fees) Amendment Regulations 2011, cl 4.

94 See Greenwood, above n 84.

95 Unit Titles (Unit Title Disputes – Fees) Regulations 2011, cl 6.

96 Clause 6(6).

law reformers, it was suggested that the economics of coherence deserve more attention. In fact, the economics of grafting unit title disputes onto the Tenancy Tribunal’s jurisdiction is illustrated by the role of Treasury in the reforms. It has been noted elsewhere that:97

The basis for these monetary sums is set out in the Regulatory Impact

Statement (Treasury, 28 February 2011). This sets out that:

(a) The expanded jurisdiction was to be fiscally neutral to the Crown.

(b) It is expected that there will be 750 category 2, and 250 category 1, applications per annum.

(c) That resources will also be put into education.

(d) That these costs do not align with comparable tribunals.

This last point amplifies the argument that these costs will inhibit the “access to justice” that the Tenancy Tribunal was supposed to provide. Given there are estimated to be over 16,000 bodies corporate in New Zealand, it remains to be seen whether the estimated application numbers will be accurate.

But the difficulties in this area are not just economic. It was noted above that the Court of Appeal decision in Winther can be treated as a public law case: a decision involving public law issues and determined in accordance with principles of public law. Significantly, the High Court did not treat the decision the same way.98 It was also noted above that Godoy – a decision about a pet – needed to be resolved in the High Court.99 This was because judicial review was sought, on the basis the body corporate was exercising a statutory power.100 The public law nature of body corporate decision-making received further attention in a later case: Velich v Body Corporate No 164980,101 where the Court of Appeal held that a body corporate could not act unreasonably or capriciously in deciding whether or not to grant a consent. Decisions by the body corporate reflected the exercise of a statutory power in accordance with s 3 of the Judicature Amendment Act 1972, and there was a “public law dimension” to body corporate decision-making that could not be overlooked.102 In this sense, a body corporate is analogous to a public body, and subject to administrative law considerations;103 put another way, a body corporate does not have unbridled power.104

This creates a further jurisdictional problem: while the Tenancy

97 Bordignon and others, above n 89, at 75.

98 See Gibbons “Case Note: Winther v Housing NZ Corporation”, above n 41.

99 Godoy v Body Corporate 164980 HC Auckland M1906/98, 14 June 1999.

100 At [1].

101 Velich v Body Corporate No 164980 [2005] NZCA 108; (2005) 5 NZ ConvC 194,138 (CA).

102 At [45]; see also [48].

103 Michael Taggart “Administrative Law” [2006] NZ L Rev 75 at 99–100;

Thomas Gibbons “Body Corporate Rules: Tensions” (2008) 16 Wai L Rev


104 See Wu v Body Corporate 366611 HC Auckland CIV-2009-404-5756, 20 May

2011 at [40].

Tribunal can clearly deal with body corporate decision-making (governance, decisions and procedures are expressly contemplated as category 1 proceedings),105 where judicial review is sought, the High Court will be the appropriate forum.106 Where there is a desire by one party to deal with matters more expensively or less quickly than through the Tribunal, oversight of a body corporate decision may be sought in the High Court through judicial review, rather than through the Tribunal’s legislative powers. This further complicates the jurisdictional challenges of the Tribunal under the Unit Titles Act 2010. It also reflects the complex incentives that can arise in cases where (for example) one party wants the matter dealt with quickly, cheaply, or efficiently, and the other does not; particularly where one party has the resources to put jurisdictional or procedural blocks in the way of resolution of the dispute. Section

227(2) of the Unit Titles Act 2010 allows proceedings commenced but not completed before the commencement of that Act to be transferred from one forum to another (for example, from the District Court to the Tenancy Tribunal) “[i]f both parties agree”. But whether parties will agree or not depends on these incentives.

One recent example is Body Corporate 193764 v Prakash,107 where a claim for unpaid levies by the relevant body corporate against Prakash started life in the District Court, based on a claim made on 19 February

2010. Following an exchange of documentation, in January 2011 the body corporate applied to transfer its claim to the High Court, on the basis that the claim arise in the context of two High Court judgments under which the body corporate was placed in administration and a scheme for repairs ordered. This application to transfer the proceedings was opposed by Prakash, but the District Court ordered this transfer on the basis that the matters raised by Prakash involved issues of body corporate responsibilities that were outside the District Court’s jurisdiction.

All this took place before the Unit Titles Act 2010 was in effect, but in January 2012, Prakash sought a change of venue to the Tenancy Tribunal, to “best enable the matter to be cost efficiently and effectively dealt with”. Prakash pointed to a number of “prejudicial consequences” of the claim being heard in the High Court, including the requirement to engage legal counsel, which would not be required in the Tenancy Tribunal; the disadvantage of the body corporate being more familiar with High Court procedures and processes; and the risk of a significant costs award against him, based on the body corporate’s senior counsel.108

The High Court responded that Prakash could appear in person, and was not required to engage legal counsel, and that the Court would make appropriate allowances for self-represented litigants; that any counsel would be aware of District Court and Tenancy Tribunal procedures as well; and that the body corporate’s lawyer was not senior counsel.

105 Unit Titles (Unit Titles Disputes – Fees) Regulations 2011, cl 6.

106 See Judicature Amendment Act 1972, s 4.

107 Body Corporate 193764 v Prakash [2012] NZHC 27.

108 At [10].

Therefore, the High Court noted, arguments based on cost efficiency and effectiveness did not carry much weight.109 Further, the High Court noted that the Tenancy Tribunal had no jurisdiction, as the claim was over $50,000.110 The Court went on to observe that Prakash was not being denied any right to justice.

At one level, we can see these brief comments from Prakash as a simple statement of jurisdiction: the matter was outside the Tenancy Tribunal’s jurisdiction, and therefore needed to be dealt with in the courts. At another level, however, we can see an illustration of two things. First, we see something close to a sense of dismissiveness that the High Court might be any less accessible, efficient or cost-effective than the Tribunal. To put this another way, the judge did not seem to think the Tribunal had any monopoly over these characteristics, and the fact that the refusal to transfer proceedings took into account grounds other than the simple question of jurisdiction provides an indication that the benefits of the Tribunal resolving disputes may be less apparent to courts than it is to policy-makers. Second, more implicitly, we can see an illustration of the incentives alluded to above: one party to a dispute may wish to resolve matters quickly, cheaply and efficiently; while the other may not. The second party may well prefer a complex, expense and time-consuming court-hearing. And as also suggested above, we can see an imbalance of power and resources: a body corporate, drawing on funding from all members, will in many cases have much greater resources to deal with a dispute than an individual owner, and this may well affect a body corporate’s preferred choice of forum.111 A greater recognition of these factors and incentives is needed by the courts, in order for the Tribunal to take its proper place in the resolution of unit title disputes.

VIII Issues in Australia

We can see, through Winther and the amendments effected by the Residential Tenancies Amendment Act 2010, the jurisdiction of the Tenancy Tribunal being clarified and expanded. We can also see, through its new jurisdiction under the Unit Titles Act 2010, a further expansion of this jurisdiction, though this is an expansion with less clarity – and more expense – attached to it. This expansion beyond residential tenancies into a range of body corporate disputes suggests that the Tenancy Tribunal (which is now misnamed) makes it clear the Tribunal will have an expanded role – become more popular, in colloquial terms. This step towards coherence, however, is not as far as some of the steps taken in Australian jurisdictions.112

109 At [11].

110 At [12].

111 See Leshinsky and others, above n 82, at 41 for comment on common

power imbalances in body corporate disputes.

112 See Stuart Morris “Tribunals and Policy” in Robin Creyke (ed) Tribunals

in the Common Law World (Federation Press, Sydney, 2008) 139 (describing

the Victorian Civil and Administrative Tribunal as a “super-Tribunal”).

In the Australian state of Victoria, for example, the Victorian Civil and Administrative Tribunal (VCAT) deals with a range of disputes, including matters relating to equal opportunity, sale of goods, domestic building, credit contracts, mental health, guardianship – and owners corporations, the Victorian equivalent of the body corporate under New Zealand’s unit titles legislation.113 The general jurisdiction includes provision for VCAT to make injunctions, declarations, and advisory opinions;114 in relation to owners corporations, VCAT has the power to (inter alia) make orders requiring a party to do or refrain from doing something, ordering compliance, authorising proceedings on behalf of the owners’ corporation, ordering the payment of money, an order varying a term of a contract, an order declaring a term of a contract void, or an order appointing a chairperson or secretary.115

It can be noted that unlike with the Tenancy Tribunal, the kinds of orders that VCAT can make are set out in the legislation in some detail: this provides welcome clarity on the scope of VCAT’s jurisdiction. With the Tenancy Tribunal, the scope of this jurisdiction is far more uncertain, as has been noted above.116 It is submitted that New Zealand would have been better to follow the lead of the clarity in the Owners Corporations Act. Further, VCAT has powers the Tenancy Tribunal does not, such as the express power to make orders in relation to damaged or destroyed buldings, an order as to the payment of insurance monies, and powers in respect of the land register under the Transfer of Land Act 1958 (Vic).117

That is, a number of the exceptions to the Tenancy Tribunal’s jurisdiction do not apply in respect of VCAT, and it can be seen as a “super-tribunal” not just in terms of the scope of the areas of law it covers, but also in the powers it holds. Australian commentators have noted that VCAT has been seen as something of a model for New Zealand,118 but were New Zealand to follow this path, the Tenancy Tribunal would need to have a much greater jurisdiction than residential tenancies and unit titles – probably, the jurisdiction of the Disputes Tribunal as well – and also greater clarity around its powers.

Interestingly, the Court of Appeal in Winther considered a decision of VCAT,119 “in which it was emphasised that eviction of people from public housing is a ‘severe infringement of their human rights, especially those which protect the family and the home’”, and where it was held that VCAT did have jurisdiction to consider a complaint by a tenant under

113 Victorian Civil and Administrative Tribunal Act 1998 (Vic); on owners’

corporations, see Owners’ Corporations Act 2006 (Vic).

114 Victorian Civil and Administrative Tribunal Act 1998 (Vic), ss 123125

and sch 1 pt 15AB.

115 Owners Corporations Act 2006 (Vic), s 165.

116 Section 77 of the Residential Tenancies Act 1986, described above,

expressly does not apply to the Tenancy Tribunal’s unit titles jurisdiction:

see Unit Titles Act 2010, s 176.

117 See Owners Corporations Act 2006 (Vic), subss 165(j)–(m).

118 Barker, above n 9, at 21.

119 Director of Housing v Sudi [2010] VCAT 328.

the Charter of Human Rights and Responsibilities Act 2006 (Vic).120

However, the Court of Appeal considered this decision distinguishable,

drawing specific attention to the differences between VCAT and New

Zealand forums:

VCAT administers over 150 Acts including the Victorian anti- discrimination legislation. VCAT is chaired by a Supreme Court judge and its jurisdiction in the field of administrative Tribunals is specialised in nature. Unlike New Zealand, the anti-discrimination legislation does not provide a specific procedure for obtaining redress for breaches of human rights.121

That is, VCAT may be a “super-Tribunal”, but to the Court of Appeal, the Tenancy Tribunal clearly is not. While the Court of Appeal’s statement is no doubt accurate, in light of the comments in Prakash, described above, the statement can be seen as something of a dismissal of the role of the Tribunal in resolving complex disputes.

It is important to remember, however, that the powers and jurisdiction of a Tribunal are not everything. Recent research has identified that within the context of Victorian owners’ corporations (the equivalent of bodies corporate under New Zealand law), greater attention needs to be given to internal dispute resolution processes, with an emphasis on mediation and conciliation, and with legislative reform to require parties to engage in “first-tier” dispute resolution before making a VCAT application.122

Better education of body corporate managers and committee members is also endorsed.123 Again looking beyond jurisdiction, others have focused on non-jurisdictional factors such as the importance of reconciliation, or theraputic jurisprudence.124 Bertus de Villiers, a member of the State Administrative Tribunal of Western Australia, has noted that because of the closeness in which people live in strata schemes (the Western Australian equivalent of unit titles, disputes can often be intense, personal, and affect a number of persons: therefore, the way in which disputes are resolved is of critical importance. De Villiers describes mediation and restorative justice as “key words to direct the mechanisms and procedures to resolve strata title disputes”, even though the latter phrase appears nowhere in the legislation.125 The State Administrative Tribunal is noted by De Villiers to have a “wide jurisdiction”,126 and he pays due attention to procedural matters, but an emphasis on restoration

120 Winther, above n 41, at [18].

121 At [44].

122 Leshinsky and others, above n 82, at 56–58.

123 At 56–58.

124 See, eg, Lisa C Toohey and Daniel J Toohey “Achieving Quality Outcomes

in Community Titles Disputes: A Therapetic Jurisprudence Approach”

[2011] MonashULawRw 16; (2011) 37 Mon LR 298.

125 Bertus de Villiers “Strata Titles, Mediation and Restorative Justice: Making

Our Lives Liveable” (paper presented at the Strata and Community Title

in Australia for the 21st Century 2011 Conference, September 2011, copy

on file with author) at 2.

126 At 1.

of relationships highlights that jurisdiction need not be the essential point of focus for a Tribunal. However, the extent to which an adjudicative body requires effective jurisdiction to properly carry out its role is implicit in De Villiers noting that the State Administrative Tribunal is a “one stop shop” for strata disputes:127 the Tenancy Tribunal is not a “one stop shop” for unit title disputes, and it is plausible that concerns about the unclear nature of its jurisdiction will lead to disputes not being able to resolve disputes efficiently, or potentially to parties not bringing matters forward to the Tribunal at all where there is uncertainty about the ability of the Tribunal to resolve them.

New Zealand unit titles law is heavily based upon Australian examples. However, while there are various studies of unit title/strata title dispute resolution in Australia, including cross-jurisdictional ones,128 none of these appears to have explicitly focused on the economic, personal and public law considerations discussed here.

IX Conclusion

It has been noted that the Tenancy Tribunal can be considered as both New Zealand’s most popular Tribunal, and most unpopular Tribunal. This is something of a tension. The Tenancy Tribunal has had unit title disputes grafted onto its jurisdiction to improve access to justice, but can also be considered New Zealand’s most expensive Tribunal. This is also something of a tension. The Tenancy Tribunal’s jurisdiction has been narrowed in respect of public law issues through Winther, but expanded through the Residential Tenancies Amendment Act 2010 and the Unit Titles Act 2010. This simultaneous contraction and expansion is also something of a tension. There may seem to be little coherence between residential tenancies and unit title disputes, but some similarities are apparent. Winther was a case about personal, rather than fungible, property rights; similar considerations of personal interests arise in many unit title cases, such as Godoy. But Winther, Godoy and Velich also share the element of involving public law issues. However, while the public law issues may sit in something of a tension with the personal aspects of these cases, they also indicate a key synergy in this area.

Synergies allow coherence: coherence often seems a conceptual goal, one that has been supported or critiqued by various commentators. It is less often seen as an economic goal, though when we consider the language of economics, it becomes apparent that economic considerations can hardly be ignored. But a further tension arises when coherence produces outcomes that are seemingly uneconomic, or that create poor incentives. This is illustrated through examination of the Tenancy Tribunal’s jurisdiction, where the costs of bringing a claim are high;

127 At 8.

128 See K Everton-Moore and others “The Law of Strata Title in Australia:

Jurisdictional Stocktake” (2006) 13 APLJ 1 for a comparison between the

Australian states and territories.

there is signficant uncertainty over its jurisdiction; and the ability to have proceedings heard in the Tribunal depends on the will of judges, as was the case in Prakash. What is needed, then, is greater attention to the conceptual foundations of the Tribunal’s jurisdiction. This has to start with greater attention to the Tribunal itself, a forum that is often ignored by legal commentators. We then have to properly understand what has been achieved through the various reforms.

Most obviously, there has been an expansion of jurisdiction, though this has occurred at many levels. There has been an expansion of jurisdiction into a new area of law: the law of unit titles. There has been a quantitative expansion in the monetary limits of matters the Tribunal can hear. There has been a qualitative expansion in the degree to which landlords must respect tenants’interests, both within boarding houses, and in the context of termination, where personal items are involved. There has been a qualitative expansion in the types of disputes that may arise, from two-party landlord-tenant disputes to multi-party disputes arising from boardinghouses or from body corporate issues, which may be multi-faceted and involve multiple parties with disparate interests. It is not just “coherence” that has been achieved. Rather, it is a broad and deep expansion of jurisdiction, at many levels. There has also been a contraction of jurisdiction, particularly in respect of the public law issues raised in Winther; but also in the way the prescription of the Tribunal’s jurisdiction over unit title disputes has ignored the public law issues that may arise, and in the way that Court decisions have criticised or limited the scope of the Tribunal to resolve disputes. This was a feature of both Prakash and Winther. This illustrates that no matter what policy-makers might seek through coherence, the Tenancy Tribunal is not – and is not seen to be – a “super-Tribunal” in the VCAT mould.

Through this expansion and contraction, it is essential to understand deeper economic forces at work. As a topic of study, the economics of jurisdiction (like the Tenancy Tribunal itself) remains largely unstudied. Various incentives have been created through these reforms, including incentives for carelessness on the part of tenants over their personal items; incentives for parties to raise uncertainties over the categorisation of disputes, making them more expensive to resolve; and incentives for parties to seek to bring matters outside the Tenancy Tribunal’s jurisdiction

– whether on the grounds of public law issues, monetary limits, title of land, or otherwise - so as to make it more difficult for such matters to be resolved quickly and efficiently.

The Tribunal will, with its expanded jurisdiction, hear more disputes. It will become more popular. It will hear more disputes about the termination of tenancies, the rights of tenants, the differences between body corporate neighbours, and between unit title owners and third parties. But the fact that the Tribunal will hear more disputes in future does not itself mean that coherence has been achieved. Future disputes are likely to illustrate the tensions arising from “personal” property rights, public law considerations, and the economic factors and incentives

that determine the bringing of disputes before the Tribunal. It is also important to understand that the Tenancy Tribunal will become, more than ever, a Tribunal of property disputes. Statute law may, as Radin has described, shift the bundle of rights associated with property ownership between landlord and tenant. Unit title ownership itself is well-described as a bundle of rights, one that cannot easily be unbundled.129 The right to bring disputes before the Tribunal is an important part of this bundle: it is considered sufficiently important that contracting out of this right is prohibited.130 Fundamentally, what the Tribunal must do is balance the different aspects of the rights in this bundle, ensuring that economic incentives, personal interests, property rights, public law issues and the goal of coherence are properly balanced.

129 See Gibbons, above n 79, at 29.

130 Unit Titles Act 2010, s 174.

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