For the Zadeh family it was the tenant from hell when property agents installed a member of the Nomad gang as tenant in their Richmond investment property. The Zadehs were subsequently ordered to pay $420,000 damages to a purchaser after evicting the tenant and onselling, inaccurately promising the buyer it was not a leaky home.
Initially from Iran, the Zadehs moved to New Zealand from the United States after completing a large-scale property subdivision in Colorado. They purchased investment properties in the Marlborough-Nelson area. Their 2012 purchase of a residential investment property on Blair Terrace in Richmond proved a nightmare.
The High Court was told their tenant failed to pay rent, used the premises to manufacture methamphetamine, flooded the house after blocking drains to prevent police getting forensic evidence by testing wastewater leaving the property and threatened the Zadehs when they sought access. Police assisted in the issue of an eviction notice. During the last three months of occupation, the tenant prominently displayed a banner stating: ‘Leaky Home For Sale Available August.’
Selling the property proved difficult. Eventually, Mr Zadeh advertised Blair Terrace as a private sale on TradeMe. Negotiations leading to a December 2016 sale underwent close examination in the High Court. Existence of the ‘leaky home’ banner was widely known in the neighbourhood. Evidence was given that Mr Zadeh was keen to tell intending purchasers the banner’s message was untrue. The banner was a malicious act by a former tenant, he said. At the same time, he was keen to downplay weathertightness issues which had been subject of a claim to the Weathertightness Resolution Service by a former owner. There was evidence that during their ownership, the Zadehs twice repaired the living room ceiling because of leaks and also had repairs made in the master bedroom and en suite. Justice Dobson ruled Mr Zadeh did make emphatic statements during negotiations that Blair Terrace was not a leaky home. This was untrue. The purchaser was entitled to damages. The High Court was told remediation would require replacement of all exterior cladding and installation of a new roof. This cost would exceed the $520,000 purchase price paid.
The Zadehs were ordered to pay damages totalling $420,00: the estimated cost of remediation less a deduction of some $18,000 for deferred maintenance and a further $100,000 for ‘betterment.’ After remediation, the purchaser would have a better property than that purchased.
White v. Zadeh – High Court (8.12 20)
21.012