Tribunal orders compensation for tenants of damaged Nelson slump‑zone house

A couple paid more than $500 a week for a draughty, damp house that was cracked and uneven from being on a hillside slump zone.

Now they’ve won more than $6000 in compensation and damages after renting the Nelson property, which fell short of the Government’s Healthy Homes Standards.

This was despite claims by the landlord that a list of problems had been fixed.

An independent inspector found that the home, in an active slip zone, was damaged enough that it would struggle to meet legal standards.

Tenants Lisa-Maree and Dominic Hurdle signed a lease for the property on Nelson’s Port Hills in March last year and left in July this year.

They signed the tenancy without having seen the property first.

The Tenancy Tribunal said in a recent decision that they needed to find a home in a hurry. They had been working with a housing adviser at the Ministry of Social Development.

Tribunal adjudicator Michael Brennan said the tenancy started under a new agency, The Rent Shop. Landlord Colin Barrow had previously used another property management company.

Problems evident ‘straight away’

Brennan said it was evident straight away that there were significant issues with the house.

This should have been apparent to The Rent Shop when it took on the property, despite interior decoration that might have masked some underlying problems.

Alex Watson, chief executive of The Rent Shop, told NZME that lessons had been learned, in various ways, and the case was a reminder to anyone “dragging the chain” on compliance with Healthy Homes Standards.

“Knowing what we know now, there’s no way we would have taken on the property.

“We’ll certainly be tightening our due diligence in light of this,” Watson said.

Landlord thought home was compliant

The landlord, who was overseas, was under the impression the home met the standards, and was surprised to learn areas needed to be rectified.

Barrow set a market rent of $620 a week, based on agency advice, but later reduced it by $100 a week.

This was after the tenants had asked for a reduction of $150 a week, to acknowledge the living conditions, Brennan said.

The tenants claimed the landlord failed to remedy several repair issues within a reasonable timeframe.

Barrow said all repairs notified to him by the property manager had been “approved and carried out without delay”.

The property received an initial Healthy Homes Standards (HHS) report in May 2020, which identified some failures.

Brennan said some were professionally remedied, while the owner did draught stopping himself.

“The repairs were effectively self-certified compliance as no revisit from the inspector took place,” Brennan said.

He said a second HHS report, two weeks into the tenancy in March 2024, identified several failures, plus work needed to make it compliant.

Watson said the tenants were issued a 90-day notice in April once the extent of the work needed was known.

The tenants’ claim that it was “retaliatory notice” was dismissed by the tribunal at a short hearing in June.

Deadline for legal standard not met

Brennan said it was not until November 2024 that some maintenance work was attempted to address some of the issues identified in the second report.

It included repairs to the guttering, which had vegetation growing from it, draught-proofing, confirmation of underfloor insulation, placement of a ground moisture barrier, and roof insulation to be tidied in certain areas.

By that time, the statutory requirement for the premises to be up to the legal standard was well past.

Even after the work done in November, two further third-party reports highlighted ongoing problems, Brennan said.

The tenants’ claim for damages and compensation was made at a separate, final hearing subsequent to the hearing in June to consider retaliatory notice.

Land movement ‘biggest problem’

Brennan said the biggest problem during the tenancy was the consequences of land movement and failures of some fixtures attached to the property.

The property was one of about 120 that sat on or near the Tāhunanui slump, a large, slow-moving landslide covering about 26ha.

It was last activated by heavy rain during the August 2022 storm.

A building report in March 2025 noted that there was no evidence of current moisture, but remnants of black mould remained on the ceilings in some rooms.

However, like earlier inspections, it was prepared without the inspector being able to access the downstairs basement, Brennan said.

The main concern internally was the slope on which the home sat.

The report said the floors had dropped and the entire structure had moved to the extent that the walls were “significantly out of plumb” and showed a similar angle to the floor slope.

There were cracks in the exterior plaster cladding as well as some cracking in the concrete foundation. The concrete stairs on the northern side of the property had also cracked and moved significantly.

The report writer said that, given the extent of the movement, it was “seriously doubted” that the dwelling could be made to meet the standard completely, or be maintained to the standard.

“Windows are constantly jamming due to movement, even though dry at the time of inspection,” the report said.

A subsequent Nelson City Council building compliance report backed the findings of the earlier report, but said there were no known or reported slips on the property.

Brennan said the challenges for the owner of a property near or on an active slump zone were accepted.

What was not accepted was that the premises were provided and maintained in a reasonable state of repair when rent was being taken.

“Nor is it accepted the landlord complied with the statutory requirements for Healthy Homes compliance, required by 6 July 2024,” he said.

Brennan found the landlord had failed to comply with the requirements of a section of the law.

He ordered The Rent Shop, as agent for the owner, to pay the tenants $4100 in compensation for failure to maintain the property and $2400 in exemplary damages for breaches of the Healthy Homes Standards.

Brennan said failures were the responsibility of the landlord and the property manager, unless apparent and noted accordingly.

Watson told NZME the order had been paid, mostly by the owner, with the agency chipping in to help.

The agency no longer managed the property, which he understood remained vacant.