When a property management company received a complaint that a rental was being used to provide sex services, it gave the tenant seven days to move out.
It also asked her to pay for commercial cleaning, saying, “In your case, we also require full disinfection”.
But the Auckland tenancy was unlawfully terminated, and Mission Property Management (MPM) has been ordered to pay up.
In a Tenancy Tribunal decision released this week, tribunal adjudicator Robert Kee said MPM felt justified in terminating the tenancy because of evidence it had received that the tenant was subletting the premises or misusing them to provide sexual services.
“It considered it had caught the tenant red-handed so it could terminate the tenancy with impunity.
“The property management company’s approach was misguided. It appears to have thought the fact that there was evidence that sexual services were being provided at the premises, the tenant had no legal rights.”
The tenant also sought a refund of rent she overpaid after MPM made her pay for a further two weeks after she moved out.
Meanwhile, MPM counter-claimed for compensation and exemplary damages, alleging the tenant failed to ensure the premises were occupied principally for residential purposes, sublet or otherwise parted with possession without consent, failed to leave the premises reasonably clean, and did not return all the keys.
Tenant given seven days’ notice
According to the decision, the tenancy was for a fixed term from January 18, 2026, to January 16, 2027. The tenant said in her application that she was renting the property for herself, her partner and her mother.
On March 5, the property manager carried out a routine inspection, during which the tenant and another woman were present.
Later, the property manager emailed the tenant seeking clarification about subletting, believing a room was being rented out without permission.
The tenant denied this, saying her mother had returned overseas and the woman present at the inspection was a friend.
“If I were to sublet, I would definitely inform you in advance and only do so if you agree,” she told them.
On April 23, Barfoot & Thompson, the building’s body corporate manager, emailed the unit’s owners on behalf of the body corporate committee about a suspected breach of the rules.
“It has been brought to our attention that [the unit] is being used for the purposes of providing commercial sexual services or as an adult entertainment venue (or other use associated with the sex industry),” the email read.
“The Body Corporate Committee requests this activity ceases immediately, the failure of which will result in legal action being taken. This notice is provided as a formal warning; further breaches of this operational rule will also result in breach fees being charged against the unit.”
That day, MPM texted the tenant saying it had received a letter alleging that “pornographic activities” were taking place at the property and sought immediate termination, giving her seven days to leave.
It also asked her to arrange commercial cleaning.
The tenant responded: “I’m not quite sure why there’s a warning, because after my mom returned to China in March, my friend was living there, and I was staying with my partner.”
When she asked whether she had to move out immediately, MPM said yes, adding: “The body corporate has many evidence videos”.
The decision did not say what the videos showed.
The tenant complied and moved out.
MPM then asked her to pay a further two weeks’ rent “since your personal actions caused the landlord’s loss,” the decision said.
However, because MPM had evicted her, Kee said it had no basis to require the additional rent and ordered it be refunded.
Kee said a more measured response to the body corporate complaint would have been to warn the tenant or seek termination through the tribunal.
He found MPM had unlawfully terminated the tenancy and harassed the tenant, and ordered it to pay her $2348.71 in exemplary damages, overpaid rent and moving costs.
MPM general manager Wallace Wang said the company’s intention was to resolve the situation promptly in response to concerns that the property was not being used for residential purposes.
“However, we recognise that any action taken in a tenancy matter must comply with the Residential Tenancies Act 1986 and the proper legal process.
“We respect the tribunal’s decision and are reviewing its findings to identify any issues for our procedures and staff training.”
MPM’s claims
On MPM’s claims against the tenant, Kee ruled that although the tenant was not staying at the premises, she was controlling who was living there or otherwise using them, so she had not surrendered or given up possession.
There was no evidence she charged anyone living there rent, so Kee found she had not sublet the property.
However, Kee found the tenant breached the tenancy by failing to ensure the premises were used for residential purposes but said no remedy was called for under the Residential Tenancies Act.
He also found the tenant did not leave the premises reasonably clean and failed to return the house and letterbox keys, and ordered her to pay MPM $275.
