How to avoid meth-ridden properties burning holes in your pockets

How to avoid meth-ridden properties burning holes in your pockets

Most New Zealanders active in the property market can spot a leaky home from a mile away. Their ears prick up at the mention of asbestos, and they’re conscious of earthquake strengthening.

But the alarm bells aren't quite so obvious if a property’s ridden with traces of methamphetamine.

The evidence can be hidden by a coat of paint, or the perception that drug users couldn’t possibly live in multi-million dollar houses with white picket fences.

Police say the supply of and demand for methamphetamine has been stable over the past six years.

Yet the fact P (pure methamphetamine) makers, who leave dangerous, invisible, and lasting chemical footprints in their wake, are often on the move, highlights the enormity of the problem.

As manufacturers move between residential and commercial properties, baches, hotels and motels, the number of properties affected will continue to increase, even if the number of P-users flat-lines.

A P testing and decontamination company, MethSolutions, estimates police have only busted around 2,000 of the 20,000 to 40,000 P labs it estimates have been in existence in the about 15 years P has been manufactured here.

Traces of meth can make you sick, devalue your property, and ultimately burn a hole in your pocket.

Lack of reporting

The problem is exacerbated by the fact property owners don’t always have to report contamination, meaning there isn’t a reliable record of which properties have been affected.

Contamination has to be reported when a local authority becomes aware of it. It will then issue a cleansing order under the Health Act 1956, requiring the property to be tested and decontaminated accordingly.

It is at this point that the contamination will be recorded in the property’s Land Information Memorandum (LIM), as well as in the regional council’s contaminated land register.

MethSolutions director, Miles Stratford, points out, having this on a LIM is a disincentive for property owners to report the issue. Rather, they will endeavour to hide the evidence and sell the property off, or deal with it through a private decontaminator.

Drug Testing Services director, Rick Lewer says, "We advise our clients they should report contamination to a territorial authority. Under the Health Act we are sometimes required to report the contamination to a public health unit."

Contamination may also be reported when property owners make insurance claims for losses resulting from contamination.

For example, Tower’s Rental Protection policy stipulates, “You must make a formal complaint to the Police about the manufacture, storage, use or distribution of the controlled drug at your house before this cover applies”.

Who’s liable?

The fact property owners aren’t liable for any health problems their tenants may incur from living or working in contaminated properties, if they weren’t aware of the issue, provides another incentive for them to remain blissfully ignorant.

Stratford says he’s dealt with a case where the Auckland Council issued a West Auckland commercial property owner with a cleansing order in January 2014.

The owner ignored the order, and got a new tenant in July 2014. They only decided to do something about the contamination last month, by which time the tenant’s stock had most likely been contaminated.

Employers on the other hand are responsible for their employees’ health, and will be liable for paying for any issues, even if they’re unaware of contamination in the premises. ACC doesn’t cover this type of workplace injury.

As for state houses, Stratford believes it’s unlikely the Government will fork out to pay private experts to comprehensively test all the houses it’s committed to selling.

He says only one of the six or seven Housing New Zealand properties he’s tested have not been meth affected.

Insurance

Your insurer will cover the cost of decontaminating and restoring your property if you find out it’s been turned into a mini meth lab, right?

Wrong.

There are a few things to look out for in your policy.

1. Exclusions: Some policies may outright exclude drug-related damages. AA HomeCover for example stipulates it won’t cover “accidental damage or costs, directly or indirectly caused by, arising from or involving… pollution or contamination, including any contamination caused by, or in connection with, an illegal activity”.

2. Caps on the amount of cover available: Stratford says a number of policies limit cover for loss resulting from contamination to $25k. If testing costs $3k, decontamination $10k to $50k, re-testing another $3k, and restoration $15k, that $25k goes pretty quick.

3. Meeting certain obligations as a landlord: Tower’s Rental Protection policy and NZI’s Essence Home Insurance policy, for example, detail a list of actions landlords must take to be covered for chemical contamination. This includes completing an internal and external inspection of the house at least every three months, and documenting any new damage or concerns.

4. Proving the contamination happened when you were insured: Tower’s Rental Protection policy stipulates this for example. This highlights the need to do testing on taking out a policy, so you can prove when the contamination occurred.

Different insurers have different schemes for covering owners if their properties burn down, due to meth-related activities.

For some, this is included in general fire cover, while for others, the types of conditions mentioned above need to be met, and the cover may only be limited.

New standards in the pipeline

Standards New Zealand gave Local Government New Zealand a proposal in December, detailing how it would cost over $60,000 to develop a standard on the testing and remediation of properties used for the manufacture or use of methamphetamine.

The idea is to have a more standardised approach to the matter. This could include legally obliging property owners to disclose contamination in LIMs.

The proposal says it’ll take 11 months to put the standards in place. However, Lewer expects it’ll take up to two years for them to be set in stone.

We welcome your help to improve our coverage of this issue. Any examples or experiences to relate? Any links to other news, data or research to shed more light on this? Any insight or views on what might happen next or what should happen next? Any errors to correct?

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Investors should not hesitate to install meth detetctors in their properties so as to avert this problem as much as possible.
Meth detectors act much like smoke alarms and can be monitored sending out alarms to owners when drugs are dedected.
The cost is simalr to smoke alarms but well worth it.
In property I know about, the meths had soaked the whole house to such an extent that the house had to be totally demolished, and the land scraped clean to half a meter depth.
Even the neighbours houses had to be decontaminated.
Luckily insurance did pay out for the lot, but this is no guarantee for the future.

Thanks BigDaddy.....didn't know they existed!!!! 

And people put that stuff into their BODIES!!!!!!!!!!!!!!!!!!!!!!!

Where do i find these meth detectors? do you have a name for them?

Hi,
we don't have data on the reliability or frequency of false reports with this product so can't recommend it.
Also tenants are taping buckets etc over the units, and assuming that works to prevent activation of the alarm.
Does anyone have any data at all about whether meth minder works or not?

I'm curious to know where I stand legally as a commercial tenant. A landlord I leased a small commercial property from knew the property had been previously tenanted by a P addict and potential P cook, and didn't warn me. The usage was food preparation. I found out from a third party, and had the property tested for meth, which was positive. As soon as I found out, I vacated the property. There was a short (6mth) balance on the lease. Am I obliged to pay him for the balance of the lease, especially given that I had to find alternative accomodation and risk loss of reputation from my customers? Remarkably, he seems to think I am.

Problem Solver, I am surprised you are asking for legal advice on interest.co.nz...
Still, I reckon (to take the moral high ground and as a sign of goodwill towards your landlord) you should pay him the balance of the lease. 
You can both then walk away from the situation feeling good about yourselves.

Your property?

Oh, I already have the legal advice, I'm just curious to see where peoples moral compasses point, its often a good indicator of court outcomes.

Landlord are you serious?? 
I reckon (to take the moral high ground and as a sign of goodwill towards you) the landlord should pay back the lease you have already paid, and pay a fair contribution to the cost of shifting. You can both then walk away from the situation feeling good about yourselves.
The law should prosecutre landlords like this, absolutely disgusting (I am a commercial landlord but take time to know and vet all of our tenants)

If the landlord has to pay back the tenant  (Problem Solver) the lease already paid, then the tenant has to pay back the landlord the profit he previously made from using his (the landlord's) property....
and the tenant can pay back his customers as well, for not checking the premises first and putting his customers at risk.
'The law should prosecutre (sic) tenants like this, absolutly disgusting'...
Hmmm... why do you and Problem Solver only blame the landlord?
 
 
 

Some legal advice on contracts
 
Get a written affifavit from your third party, including a statement on how they knew, then tell your ex-landlord to sue you. If it gets to court represent yourself and turn up with the affidavit and the chemists report - doubt if it will get that far - so ask for your bond back, plus re-imbursement of the cost of the tests - PS what were the costs of the tests?

Thank you.....a few hundred as I recall..
 

what part of due diligence do you consider your business responsibility?

all aspects of the business, but that means relying on professional advice, including that of the landlords.

Did your landlord know that you were going to be preparing food?

Yes, they did.

Well in addition to Iconoclasts advice I would start indicating you will pursue damages. Moving is an inconvenience right? Did you lose any stock.
 
Documentation is your key if ever going to court. Be clinical about it.

How much of this problem is caused by people smoking meth in properties verses cooking? If tenants are smoking the stuff I assume it contaminates the property which will show up on tests. How many houses does this affect? Is this a big problem? Or is it just where the cr*p has been cooked?

My understanding is that smoking it will also leave a residue which can be tested for. How many houses does this affect? Anyones guess - but note the comment above that of the 6 or 7 state houses tested by that agent returned only one that was NOT positive for meth residue.
 
You might have noticed how many home ads these days are mentioning things like "first time on the market in xx number of years..."  or "only one owner.." I assume this is code speak for 'never a rental' and hence, unlikely to be meth contaminated.  That's not to say however that owner-occupied houses are completely safe bets.
 
Simple rule - always get a test - whether you are buying or renting.  If buying you can write that in as a condition of sale and the condition can include a stipulation that if the test comes back positive, the cost of the test is to the vendors account.  If renting, you can ask the agent in writing whether the house has been meth tested, and if not, then again make that a condition of the tenancy agreement.
 
To my mind it should be compulsory that all properties are mandatorily tested before sale as well as each time a tenency is terminated and before such time as the property can be offered again for rent. The problem, I suspect is huge.
 
 

I would add that it be compulsory that Kate pay the costs for the mandatory tests before all house sales in New Zealand and changes of tenancy in leased properties in New Zealand. 

Running on ridiculously thin margins are you, Landlord? 

Not at all Kate. Well cashed up am I. And I have never sold nor ever will sell a property so wont have to pay for your compulsory 'meth test' on sales.
I just like to see the we-know-best brigade finance their we-know-best demands.
 

Well good for you - best stay that way!
http://www.zerohedge.com/news/2015-03-18/just-one-chart
 

The drug itself is approved for prescription by the USFDA, so the byproducts of consumption are not likely to be too harmful.
 
My professional experience has been that the ingredients are the problem, toxic and/or flammable. But I wasn't certain so took a quick look at Wikipedia seems to pinpoint the problem. 
 
http://en.wikipedia.org/wiki/Formic_acid
 
http://en.wikipedia.org/wiki/N-Methylformamide
 
Edit: I forgot the byproduct, toxic and the most flammable of all. http://en.wikipedia.org/wiki/Methylamine

geee whizzz - I guess the industrial chemist business must be all the go these days
 
Assuming every young renter entering into a rental or lease agreement asks the landlord-owner for written assurance plus evidence of the tests that the rental premises are meth-free

We went to an open home for a property we liked, checked on the council's GIS database and it was marked as contaminated. Asked the agent and her response was 'gee I forgot to mention that the previous tenant was a P cook'!
 

Yep, I had the same experience.
Saw a beautiful villa in Grey Lynn, the place was reeked with bleach odour, there was wet brown spots on laundry wall (I think they forgot to clean it).  I asked if this was a P-lab, she said "no way, absolutely not.", it was pulled off the market about two weeks alter due to positive result for chemical contamination! 

It is up to the tenant to test the property.  A landlord is not always going to know if a P user has been staying at the property.

Um no, the landlord is renting out a place that should be fit for use.  Also the landlord should be insured for that possibility.
Certainly if buying it is now a test a would be landlord and FHB etc should get done.  I think a basic test is $100?
 

I rented out my property in W.Auckland, the letting agents advised that I have the house 'Meth managed' which involved having a P swab test done on th house before letting it out. This was done - all clear, I then had a 'Meth Minder' monitored meth alarm installed. If it detects Meth in the property, it sends a signal to the monitoring company. The unit is tamperproof as if it is moved, it also sends a signal, The tennants have peace of mind that they are living in a clean Meth free home, and I get to know that the house is being monitored and free from Meth. At change of tennants, the house is also Meth swab checked again. The Meth problem is a massive issue in NZ, a lot of landlords ignore the issue and do not get their houses tested.