GOVERNMENT INTRODUCES BILL TO FIX HOUSE RENTS

Hawke's Bay Tribune, Volume XXVI, Issue 144, 3 June 1936, Page 9

GOVERNMENT INTRODUCES BILL TO FIX HOUSE RENTS

PREVENTING INCREASES No Rise in Present Rates Without Magistrate’s Authority PROVISIONS OF TEMPORARY BILL By Telegraph—Press Association. WELLINGTON, June 2. Legislation fixing rents was introduced in the House of Representatives to-day. With exceptions, the rent paid by the tenant of any dwelling on May 1, if the rent did not exceed £3lO a year, cannot be increased beyond that figure without the authority of a magistrate.

The Fair Rents Bill is designed to make temporary provision until September 30, 1937, for restricting increases in the rents of dwelling-houses let at annual rentals not exceeding £2lO. The Bill, which is intended to bind the Crown, will not apply to any dwelling let for the first time after the passing of the legislation or to blocks of residential flats. The restrictions provided in the Bill will not apply in the following instances: To a house which has not been let between November 27 (election day) and the passing of the Bill. To a house which has been let between November 27, 1935, and the date of the passing of the Bill at a rent exceeding £2lO a year. The provisions for the fixing of basic rents are set out in the Bill. In the case of houses let on May 1, 1936, the basic rent will be the rent payable on that date. Where houses were not let on May 1, the basic rent is to be the rent last payable before that date. In the case of houses let after May 1 and before the passing of the Bill the basic rent is defined as that first payable for those houses.

An increase in the basic rent of any muse made between May 1 and the late of the passing of the Bill or after he passing of the Bill is to be irrecover >ble, notwithstanding anything to the outrary in any agreement. However, f a fair rent is fixed by a magistrate n excess of the amount now payable, m increase in rent will be permitted. Power is given to either landlord or enant to apply to a magistrate for an rd er determining the fair rent of a house for a period not exceeding one vear. No order made by a magistrate an be made to apply earlier than the late of the application, although if the fair rent fixed by the order exceeds the rent payable under the tenancy, the ■irder fixing the fair rent is to come into effect only after 14 days’ notice. In cases where the fair rent exceed' the rent payable under the tenancy the landlord is not entitled to charge above the rent fixed by the magistrate, but if the fair rent is less than the existing rent the landlord must reduce the rent to an amount not exceeding that fixed by the magistrate immediately the order takes effect.

In dealing with rent eases the magistrates are empowered, if they think it fair and equitable, to make an order for refund or remission by a landlord to his tenant for the whole or anv pan of rent in excess of a fair rent which may have been made or which may be payable by the tenant for any pefioff within six mouths immediately p-eced-ing that for which the fair rent was fixed. This particular provision is not to apply to any rent paid or payable tor any period for which a fair ren*. has been fixed. CONSIDERATIONS FOR COURT. Considerations to be taken into account by magistrates in fixing fair rents are set out in the Bill. It is stated that a magistrate is to have regard to the relative circumstances of the landlord and the tenant. After taking this and other relevant matters ; nto consideration, and subject to any regulations that may be made for the onrposes of the legislation, he is to fix a rent which in his opinion would he fair and equitable for the tenant to pay.

It is further stipulated that the fair rent fixed by a magistrate is not to exceed the basic rent or rent, if any. payable on November 27, 1935. The lower of these two is to be taken as the basis. However, if the landlord can produce evidence to satisfy the magistrate that in the special circumstances of the case it is fair and equitable, then the fair rent may exceed the basic rent or that payable on November 27 In an explanatory memorandum to the Bill it is stated that in the absence of regulations to the contrary a fair rent is to be such as, in the opinion of the magistrate, it would be fair and equitable for a particular tenant to nay, having regard to any hardship likely to be inflicted on the tenant or landlord and to all other relevant con siderations. The fair rent, it is stated, mav be altered from time to time and will apply only as long as the tenancy lasts. A new fair rent may be determined for any subsequent tenancy. OFFENCES; POSSESSION. It is also provided that persons wht. stipulate for, demand or accept for themselves or others any bonus, fine, premium or other similar sunt in consideration of obtaining or offering to obtain or doing anything for the purpose of obtaining a dwelling-honse for occupation of any other person commits an offence. It will be an offence to demand or accept pavment for furniture, fixtures or other effects as a condition of tenancy of a dwelling-house a sum in excess of the fair selling value of such articles. No proceedings arc to be taken by a landlord for the recovery of possession of any house or for the ejectment of a tenant unless he gives 14 days’ clear notice to the tenant concerned However, where the tenancy has beei determined by 14 days’ notice in writ ing this provision will not apply. The grounds on which orders may be made for recovery of possession of a house or for the ejectment of a tenant are as follow:— Failure of the tenant to pay '.h< agreed rent or rent fixed under tinBill, or to perform other conditions of tenancy; failure of the tenant to take

reasonable care of the premises; or th* commission of waste by the tenant the causing of nuisance or annoyance by the tenant to neighbouring oeeu piers; the reasonable requirement of the house by the landlord for his own occupation; sale of premises to a pur chaser who requires them for his own occupation; sub-letting of a house o any part of it by the tenan’ so that lie makes a profit which, having rogani to the rent he pays, is unreasonable. QUESTION OF HARDSHIP. heu application is made for >u. order for recovery of possession or loi the ejectment of a tenant, the Court has to take into consideration questions of hardship that might arise tor either tenant or landlord by the granting oi refusal of the application. It may refuse an application notwithstanding the fact that it has been made m auy of the grounds listed above. When a landlord recovers possession of a bouse for bis own occupation he must not let the house nor permit any person other than himself, his family and domestic setvaats to occupy it. He must not sell or agree to sell a house within six months of the date when he obtains possession, without the authority of a magistrate. However, if the house contains more rooms than are reasonably required by the landlord and his family, he will be permitted to let any extra rooms. When a landlord requires possession for the purpose of sale of the premises the purchaser will not be entitled 'a sell the premises again within six months except with the authority of a magistrate.

No person is to be entitled to distrain for any rent declared under the Hill to be irrecoverable, und, except with the leave of a magistrate, for anv rent in respect of any house to which the legislation applies. A clause empowers inspectors of factories to act on behalf of tenants in any proceedings under the Bill. HEARING IN CHAMBERS.

Applications to a magistrate for orders under the Bill may be made by a motion with notice to the interested parties, and provision is made for any application to bo disposed of in chambers. No party to proceedings under the new legislation is to be liable to pay the costs of any other party unless an order is expressly made by the magistrate. Such order may he made if the magistrate considers that the conduct of any party to the proceedings has been lor the purpose of causing delay or has been vexatious. Decisions of the Court are to be final and are not to be challenged except on the grounds of lack of jurisdiction. No covenant or agreement is to have any force or effect to deprive any tenant of any right, power, privilege or other benefit provided for in the legislation. The effect of this provision is that tenants are to be debarred from contracting themselves out of benefits. It is further provided that every person who by any threat- endeavours to dissuade or prevent a tenant from making or prosecuting any application under the Bill will have committed an offence. BASIS OF RENTS. The penalty for all offences under the Bill is fixed at a line of £5O. It is provided that regulations may be made by Order-in-Council to give lull effect to the provisions of the Bill. Without limiting the general powers outlined it is further provided that regulations may be made for the fixing of a fair rent at an amount equal to a percentage of the capital value of a dwelling-house being not less than 4 pe- cent, nor more than 6 per cent, per annum together with outgoings for rates, insurance and repairs and any amounts to be allowed for depreciation and as rent of furniture. Such regulations may applv generally or in respect of specified parts of New Zealand or specified classes ol houses The Hon. H. G. R. Mason, who is ju charge of tlie Bill, said that the Bill, as the title implied, was designed for the purpose of restricting ‘.he increase of rents. The essence of the Bill was that rents of houses could not be increased without reference to a magistrate. It applied to dwellings only and did not inelude premises used by n tenant exclusively or principally for business purposes. It was a temporary measure and would expire on September 30 of next year.