What was Tenancy Tribunal case 4709071 about?

The tribunal order states: An application for suppression has been made in this case, and the Tribunal

How much money was awarded in case 4709071?

Compensation: (break lease fees- adv…: $1,075.25 awarded to landlord; Compensation: (Lawns: $276.00 awarded to landlord; Filing Fee: $20.44 awarded to landlord; Rent Arrears: $1,728.57 awarded to landlord

What type of tenancy dispute was case 4709071?

The primary dispute was Rent arrears.

Where can I read the official tribunal order for case 4709071?

The official Ministry of Justice published order is available at https://forms.justice.govt.nz/search/Documents/TTV2/PDF/10123643-Tribunal_Order_Redacted.pdf.

What was Tenancy Tribunal case 4709071 about?

The tribunal order states: An application for suppression has been made in this case, and the Tribunal

How much money was awarded in case 4709071?

Compensation: (break lease fees- adv…: $1,075.25 awarded to landlord; Compensation: (Lawns: $276.00 awarded to landlord; Filing Fee: $20.44 awarded to landlord; Rent Arrears: $1,728.57 awarded to landlord

What type of tenancy dispute was case 4709071?

The primary dispute was Rent arrears.

Where can I read the official tribunal order for case 4709071?

The official Ministry of Justice published order is available at https://forms.justice.govt.nz/search/Documents/TTV2/PDF/10123643-Tribunal_Order_Redacted.pdf.

New Zealand Tenancy Tribunal Case 4709071 — Rent arrears

Claims and awards in Tenancy Tribunal application 4709071 — net $3,100.26 NZD. Amounts reconciled from the published order (claims sum and net total). Verify on MoJ.
Claim	Landlord	Reason
Rent arrears (from 15/4/2023 to 22/04/23	$1,728.57	Rent arrears (from 15/4/2023 to 22/04/23
Compensation: (break lease fees- advertising and admin costs	$1,075.25	(break lease fees- advertising and admin costs
Compensation: (lawns	$276.00	(lawns
Filing fee reimbursement	$20.44	Filing fee reimbursement
Net award	$3,100.26
Total payable by Tenant to Landlord	$3,100.26

Claims and awards in Tenancy Tribunal application 4709071 — net $3,100.26 NZD. Amounts reconciled from the published order (claims sum and net total). Verify on MoJ.
Claim	Landlord	Reason
Rent arrears (from 15/4/2023 to 22/04/23	$1,728.57	Rent arrears (from 15/4/2023 to 22/04/23
Compensation: (break lease fees- advertising and admin costs	$1,075.25	(break lease fees- advertising and admin costs
Compensation: (lawns	$276.00	(lawns
Filing fee reimbursement	$20.44	Filing fee reimbursement
Net award	$3,100.26
Total payable by Tenant to Landlord	$3,100.26

Order

An application for suppression has been made in this case, and the Tribunal orders suppression of the Tenant’s and the Landlord’s names and identifying details.
The term of the fixed-term tenancy of [Tenants name suppressed] at is reduced and now ends at 11:59pm on 22 April 2023.

Reasons

Both parties attended the hearing.
The landlord has applied for rent arrears, compensation, and reimbursement of the filing fee following the end of the tenancy.
The tenants made a cross application at the hearing for reduction of the fixed term tenancy due to financial hardship. The landlord accepted that this claim be heard on the day. as the tenants made it clear they would file their application for their claim to be heard, as well as a failure to maintain claim, and they would ask for a stay of enforcement of any order the Tribunal made until that cross application was heard. Name suppression.
The landlord, being the wholly successful party is entitled to name suppression and made an application for suppression on the application form submitted to the Tribunal.
The tenants made an application during the hearing for their names and identifying details to be suppressed. The tenants left the house and gardens in a reasonably clean and tidy state. They engaged a gardener to ensure the gardens were in a reasonably tidy state, had the lawns mowed and tried to make a property that the photographic evidence shows needed significant repairs and maintenance to be considered to be in a reasonable state of repair.
The tenants run a not-for-profit school for children with special needs and their reputation is of utmost importance to them.
I find that the public interest in this matter does not outweigh the significant duress publishing the tenants’ names could result in when they apply for future tenancies and other potential adverse impacts of having their names published. I therefore grant the tenants suppression of their names and identifying details.

How much is owed for rent?

The tenants gave evidence: a. When they first looked at the premises, they were advertised for rent under a periodic tenancy arrangement; b. They lease another property, that they run a not-for-profit special needs community funded school from. They had resided at this property since 2016, but their eldest son and daughter in law were about to have a baby and needed somewhere to live. The tenants wanted to help them with the new baby, so needed more space that they could share, so they sublet the house at the property where the school is located and entered into this tenancy agreement with the landlord; c. Everything the tenants have is tied up in the school. They do not own any land or the building the school is run out of. The charitable trust that they run has very few assets and receives no funding from the Ministry of Education; d. The premises consist of a main dwelling, which could house the tenants and their two younger sons, and a minor dwelling that could house their eldest son and his new family; e. The property also has another illegal dwelling on it that consists of an old animal barn and a number of cabins and huts that a gardener and her elderly mother reside it. The tenants say the hotch potch of temporary buildings makes that area next to the main house look messy and unkempt. The gardener maintains the property and the paddocks for the owners; f. The tenants’ say their eldest son and his wife agreed to pay $500.00 per week towards the rent of the minor dwelling and to contribute towards the other variable costs such as power, water, internet and the like. Their contribution was the only way the tenants could afford to rent a property at $1,600.00 per week; and g. The tenants requested that the tenancy be for a fixed term from 3 December 2022 to 2 November 2024, to give them and their family soe stability until the new baby turned 1 year old. The landlord agreed and the fixed term tenancy commenced on 3 December 2022.
The tenant has applied for reduction of the fixed-term tenancy, which had been due to end on 2 November 2024. The tenants moved out of the premises on 22 April 2023, but the rent summary shows they had only paid rent to 14 April 2023. They were $100.00 in rent credit on 14 April 2023. As such, the tenants were in rent arrears of $1,728.57 at the date they gave the landlord vacant possession, being 22 April 2023.
The tenants argued that they should only be liable for rent to the date they moved out of the premise and handed the keys back, as the landlord did not take all reasonable steps to limit the damage or loss arising from the tenant’s breach of the tenancy agreement and is required to do so pursuant to s49 of the RTA and that the landlord had agreed to the tenancy ending on 22 April 2023 when the property manager informed them that he had 4 potential new tenants lined up on 18 March 2023 and the owner responded to their request to terminate the tenancy early on 30 March 2023 saying “don’t be sorry life is full of surprises, I just wish you and your family find the next suitable house and keep enjoying life”.
The landlord has applied for rent arrears of $36,700.00 to 22 September 2023, as the new tenants did not move into the premises until 23 September 2023. It relies on section 61(3)(b)of the RTA that confirms a tenant that ends his/her/their fixed term tenancy early is deemed to have abandoned the premises before the end of the lease and is liable to pay rent for any period up to and including the date of the expiry of the fixed term or the date of commencement of a new tenancy of the premises, whichever is the earlier.
The Tribunal may reduce a fixed term tenancy where: a. there has been an unforeseen change in the applicant’s circumstances; and b. there would be severe hardship to the applicant if the term is not reduced; and c. the applicant’s hardship would be greater than the hardship to the other party if the term is reduced. See section 66(1) Residential Tenancies Act 1986.
There has been an unforeseen change in the tenants’ circumstances as follows: a. The tenants’ daughter in law suffered severe postpartum depression and her and the tenants’ eldest son had to move out of the premises to get the care she needed with very little notice as the state of her mental health was concerning her health professionals. The tenants’ son and daughter-in-law stopped paying their contributions to the rent and the outgoings. This placed the tenants under severe financial distress; and b. The special needs school the tenants operate, experienced a significant decline in role numbers at the start of the 2023 school year, due to the impact of the increased cost of living on top of the COVID-19 costs the parents of the disabled children had been forced to bear. This resulted in a sudden drop of income for the tenants in February 2023 they had not been expecting.
The tenants have produced evidence that shows they own no personal assets of any value; all they own is tied up in running the special needs school. The school is run as a charitable trust. The charitable trust has few assets of any value either and neither the charitable trust nor the tenants have much by way of savings in the bank.
The tenants have produced evidence that shows they would be put into bankruptcy if they were to be held liable for rent until 22 September 2023, their school would likely have to close its doors. As such, they say they would suffer severe hardship if the term of the tenancy were not reduced.
The landlord says it too would suffer hardship if the term were reduced.
The landlord provided evidence that: a. The premises are owned by [Trust name suppressed]; b. [Trustees names suppressed] are the Trustees; c. The Trust owns 10 properties in total. In addition, it owns a company called [Company name suppressed]; d. [Company name suppressed];borrowed $609,000 in January 2023, for an undisclosed purpose. The loan was taken as a mortgage over another of the landlord’s properties at [Property address suppressed]. It is not clear from the evidence whether the loan was taken to purchase that property or not. The property is subject to a security interest because of the loan. The landlord is paying an annual interest rate of 9.70% and is repaying the loan in 360 payments of $5,234.89 per month for 360 months; e. [Company name suppressed];took the loan in reliance on [Trust name suppressed];receiving $1,600.00 rent per week from [Tenancy address suppressed] and the landlord says that it will have to borrow from the Trust’s savings to help the Company to repay the $26,174.45 loan for the period 23 April 2023 to 22 September 2023.
The tenant has also produced evidence the landlord did not meet its s49 of the RTA obligations to take all reasonable steps to limit the damage or loss arising from the tenant’s breach of the tenancy agreement, in accordance with the rules of law relating to mitigation of loss or damage upon breach of contract by: a. Not accepting viable tenants that wanted to rent the premises from 23 April 2023 because: i. They were Work and Income beneficiaries and the landlord did not want to rent to a group of 8 to 9 beneficiaries; and ii. They were commercial tenants that wanted to make commercial use of the stockyard. b. Constantly changing property management companies: i. Millvip lost the property management contract in mid-May 2023; ii. Wallace and Stratton had the property management contract from mid-May 2023 to July 2023, but struggled to market it because the property was in such a bad state of repair; iii. Harcourt had the property management contract from 19 July 2023 onwards. It took a week to prepare its marketing campaign, 4 weeks to find a tenant and the new tenant needed to give 28 days’ notice to their previous landlord. c. Taking the property off the rental market from30 June 2023 to 12 September 2023 to undertake much needed repairs and maintenance.
The tenants provided photographic evidence of the property having holes I the walls, leaks in the ceiling, electric sockets broken and wires hanging out of sockets and trees and palms needing trimming, the driveway being in need of repair and the random structures around the barn and clutter needing tidying or removal. They say that the premises had all of these defects when they moved in, even thought the landlord had promised to address these issues before they moved in. The tenants say that these same issues led to potential tenants not wanting to rent a $1,600.00 per week property that was clearly not in a reasonable state of repair.
The landlord confirmed that the property was off the rental market for about a month over winter to undergo some renovations but that it had found the property not to be attractive to the type of tenants it wanted during the winter season. It says it kept looking for new tenants while it undertook the renovations. It also claimed it was entitled to seek tenants that would look after the property and that had good credit and other ratings and that the tenants found in March 2023 were unsuitable as they did not meet these criteria. It is for a landlord to assess the suitability of new tenants and the reasons it gave for not accepting these prospective tenants were fair and reasonable.
The tenants produced evidence that the gardener had informed them that the property had not been viewed or marketed when the renovations were taking place.
On the balance of probabilities, I find that the landlord did not market the property from 15 May to 29 July 2023, while they undertook the renovations as it had been informed by Wallace and Stratton that it could not attract tenants unless the property underwent some renovations to bring it to a reasonable state of repair expected of a high-end property worth $24 million. The landlord gave evidence that Harcourts advertised for new tenants from 8 weeks before 23 September 2023 and the new tenants then had to give 4 weeks’ notice. That means Harcourts were advertising the property by 30 July 2023. This means the tenant cannot be held liable for those 30 days of rent arrears. This leaves the rent arrears of $17,371.42 for the following periods in dispute: a. 23 April 2023 to 14 May 2023 (3 weeks or $4,800.00); and b. 30 July 2023 to 23 September 2023 (7 weeks and 6 days or $12,571.42).
I find that the tenant’s hardship having to pay $17,371.42 rent arrears for that period would be greater than the landlord’s hardship because: a. The tenants have proven that they do not have the means to repay that sum without putting them int bankruptcy and having to close a special needs school for children with learning and other disabilities; b. The tenants had an unforeseen change in their circumstances when their son and daughter-in-law left them carrying an extra $500.00 per week of rent and increased variable utility costs at the same time as their school roll suddenly dropped at the start of the new school year when there had been no forewarning so many parents would be in such financial difficulty that they could no longer afford alternative special schooling for their children; c. The tenants have no ability to get a loan to repay $17,371.42 in rent arrears and no assets to sell to cover that sum of money; d. The landlord owns 10 properties and an equity business and was able to get a $609,000.00 mortgage to either buy [Address suppressed] or to take a mortgage against that property to invest into [Company name suppressed]; e. The [Trust name suppressed];did not take out the loan, a company its owns did. It did not take the loan out as a mortgage over [Tenancy address suppressed] and it has not explained why it took the loan and why the rent from [Tenancy address supporessed] was needed to repay the loan; f. The fact the landlord took [Tenancy address suppressed] off the market to renovate it for at least a month suggests that the rent was not as critical to the Company’s or the Trusts ability to repay the loan payments over that period; g. The fact the Trust can loan the Company the funds to make the loan repayments shows the Trust and the Company has the ability to absorb the loss of $17,371.42 rent arrears than the tenants do.
Therefore, the tenancy ended on 22 April 2023. The landlord provided rent records which prove the amount owing at the end of the tenancy.
Where the Tribunal reduces a fixed-term tenancy, it may order the tenant to pay the landlord reasonable compensation for any resulting loss. See section 66(2) Residential Tenancies Act 1986.
I award compensation of $1,075.25 to the landlord, for the reasonable administration and advertising costs it incurred. I do not find that the tenants should be liable for property management related costs of attending property viewings and undertaking exit and entry inspections. As such I dismiss the landlord’s claims for $360.00 plus GST for attending viewings and $360.00 plus GST for exit and entry inspections. There is no ability in the RTA for a landlord to charge a tenant with the cost of a property manager or agent to manage the premises (refer to section 11 of the RTA). These are a cost of doing business that landlord cannot pass on to the tenant.

Did the tenant comply with their obligations at the end of the tenancy?

At the end of the tenancy the tenant must leave the premises reasonably clean and tidy, remove all rubbish, return all keys and security devices, and leave all chattels provided for their benefit. See section 40(1)(e)(ii)-(v) Residential Tenancies Act 1986. The tenant is required to replace worn out smoke alarm batteries during the tenancy. See section 40(1)(ca) Residential Tenancies Act 1986. The tenant must also replace standard light bulbs.
The evidence provided supports the tenants claims they left the premises reasonably clean and tidy, and removed all rubbish. They also returned the keys and there were no chattels missing at the end of the tenancy.
The landlord made a claim for $2,271.56 for gardening. On examination of the invoice produced, I find that the work undertaken was more than could be classified as bringing the gardens up to a reasonably clean and tidy state and that the costs were related to extensive cutting of trees and palms that had required maintenance before the tenancy commenced. I do not find the tenants liable for these costs. The costs of bringing the property up to a standard, beyond reasonably clean and tidy, so the property is more attractive to prospective renters should be borne by the landlord. As such, I dismiss the landlord’s claims for $2,271.56 for gardening.
The landlord’s claim for $276.00 for lawn mowing is proven and not disputed by the tenants.
The amounts ordered are proved. Reimbursement of filing fee
Because [the applicant] has wholly succeeded with the claim I must reimburse the filing fee.

Tenancy Tribunal case 4709071 — Rent arrears

At a glance

Tenancy Tribunal case 4709071 — Rent arrears

At a glance

Award balance

Claims & awards

Order

Reasons

How much is owed for rent?

Did the tenant comply with their obligations at the end of the tenancy?

Topics & place

Residential Tenancies Act sections

Key findings

Frequently asked questions

Award balance

Claims & awards

Order

Reasons

How much is owed for rent?

Did the tenant comply with their obligations at the end of the tenancy?

Topics & place

Residential Tenancies Act sections

Key findings

Frequently asked questions