Court of Appeal confirms residential tenants’ immunity from suit

The Court of Appeal has upheld a decision of the High Court which found that a residential tenant under the Residential Tenancies Act 1986 enjoys the benefit of his or her landlord’s insurance and is therefore immune to legal claims in relation to property damage caused by the tenant that is covered by that insurance: Holler v OsakiĀ [2016] NZCA 130.

I wrote about the High Court decision here, offering the respectful opinion that the High Court decision was incorrect. For the same reasons I believe the Court of Appeal decision is incorrect.

The case lends itself nicely to a further appeal to the Supreme Court, because it is essentially one of statutory interpretation, and is clearly one of general public, and commercial, significance.

Steve Keall
23 April 2016



2 thoughts on “Court of Appeal confirms residential tenants’ immunity from suit

  1. Chris

    Hi Steve

    Long time reader, first time poster. While I don’t disagree with your reasoning on the statutory interpretation issues in both the CA and HC judgments, I see less of a clear line and more of a reasonably clear policy intent let down by a mishmash of drafting, a failure to ensure that the RTA and the PLA were compatible, and most worryingly, a failure of Parliament to give proper, timely attention to law reform proposals put before it.
    I think that this case really illustrates the problems when the Court needs to interpret statutes in a just, but technically correct manner, especially when the drafting is poor.
    My personal view is that the outcome is the right one; I see no good reason in policy why a commercial tenant (well advised and well insured) should have more protection than a residential tenant (unadvised and uninsured in any of the relevant cases).
    What has been most irritating for me has been comments made by ICNZ about this case, Tim Grafton in particular, who either hasn’t read or hasn’t understood the case. His comments and those of others have ignored the fact that the protection in s269 is only against “fire, flood, explosion…”etc or an otherwise insured peril, and that the onus remains on the tenant to disprove liability, and that any act of the tenant which limits the insurers liability will remove the tenant’s ability to rely on the exoneration. Having seen from the inside how recovery operates while working for a few different insurers, I’m reasonably certain that this decision won’t increase insurers costs, although it will stop lawyers like me from earning fees pursuing or defending such cases. I’ve defended a couple of subrogated recovery actions brought by insurers where this decision would apply, in both instances the recovery was technically correct but brought in a cynical manner and, had the insurers suceeded it would have been thoroughly unjust.

    Chris Boys


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