PrimeProperty ordered to pay more than $7500 for renting out 61 Molesworth St illegally
A renters' lobby group has labelled a $600 fine for letting a family live in a now-demolished Wellington office block a "ludicrous and inadequate" slap on the wrist for its owner.
PrimeProperty Group owns the block at 61 Molesworth St, and has been ordered to pay damages of just $600 after illegally housing tenants in the building.
The Tenancy Tribunal has ordered the group to pay back $6900 in rent to the tenants, and their $20 filing fee.
But Kayla Healey, of Wellington Renters United, said the tribunal had not gone far enough in punishing the company and its chief executive, Eyal Aharoni.
* Earthquake-displaced family could lose everything when Wellington office building is torn down
* Perfect storm as Wellington's rental squeeze spreads to suburbs
* Greed, desperation, and squalor - life in illegal boarding houses
* Building on Wellington's Molesworth St being torn down
The case was "an unfortunate illustration" of how desperate the situation for renters was at the moment, especially in Wellington.
"If it weren't for the utter lack of affordable housing in the city, this situation is unlikely to have occurred in the first place," she said.
"It's only out of desperation a family would choose to live in a place which put their lives at risk."
The $600 fine for damages for putting people's lives at risk was "irrefutably an inadequate penalty handed down by the tribunal".
"I can't think of any other justice department in which it would be acceptable to hand out a $600 fine for intentionally putting lives in danger and generating a profit from it."
Healey said the case highlighted the desperate need for licensing and regulation of landlords and property management companies.
After November's Kaikoura earthquake, the building was evacuated and the Mape family was found to have been living there.
Olive and Ernest Mape had been living in the nine-storey building with their two teenage children since June.
November's 7.8 magnitude earthquake did so much structural damage to the building that a decision was made to bring it down.
The Ministry of Business, Innovation and Employment (MBIE) tenancy compliance and investigations team sought an order on behalf of the tenant saying the tenancy was illegal.
MBIE said the building could not lawfully be used for residential purposes.
In a statement, an MBIE manager, Steve Watson, said the case was "a prime example of taking advantage of someone who is in a vulnerable position".
He said the exemplary damages costs of $600 reflected the extent of the health and safety risks tenants faced, and the fact the landlord should have known better.
"This decision sends a strong message to landlords that the penalties are high if you are caught renting commercial property to tenants."
Aharoni said on Wednesday evening that he was disappointed by Watson's comments, as he was trying to help the Mapes by giving them cheap rent, and there was no financial gain for PrimeProperty.
"I know we were doing them a favour."
The tribunal was not persuaded the tenancy was entered into on compassionate grounds as the landlord had a legal obligation to the Mapes after another PrimeProperty building offered to the family under a fixed term lease was leaking.
Aharoni agreed with the tribunal that the 61 Molesworth St tenancy should not have been allowed to happen.
"We regret it and I can assure you that this kind of tenancy will not be repeated," he said.
The tenancy was intended to be short term to allow the family to find alternative accommodation and, when they refused to leave in October before the earthquake, PrimeProperty had no option but to serve the Mapes with a notice to leave by January, Aharoni said.