What was Tenancy Tribunal case 4965638 about?

The tribunal order states: The tenancy of Teau Manu and Arcadia Talagi-Manu at 39 Norrie Smith

How much money was awarded in case 4965638?

Filing Fee: $27.00 awarded to landlord; Rent Arrears: $20,814.29 awarded to landlord; Water Rates: $1,284.89 awarded to landlord

What type of tenancy dispute was case 4965638?

The primary dispute was Rent arrears.

Where can I read the official tribunal order for case 4965638?

The official Ministry of Justice published order is available at https://forms.justice.govt.nz/search/Documents/TTV2/PDF/10912761-Tribunal_Order_Redacted.pdf.

What was Tenancy Tribunal case 4965638 about?

The tribunal order states: The tenancy of Teau Manu and Arcadia Talagi-Manu at 39 Norrie Smith

How much money was awarded in case 4965638?

Filing Fee: $27.00 awarded to landlord; Rent Arrears: $20,814.29 awarded to landlord; Water Rates: $1,284.89 awarded to landlord

What type of tenancy dispute was case 4965638?

The primary dispute was Rent arrears.

Where can I read the official tribunal order for case 4965638?

The official Ministry of Justice published order is available at https://forms.justice.govt.nz/search/Documents/TTV2/PDF/10912761-Tribunal_Order_Redacted.pdf.

39 Norrie Smith Avenue, Flat Bush, Auckland 2023 Tenancy Tribunal Case 4965638 — Rent arrears

Claims and awards in Tenancy Tribunal application 4965638 — net $20,166.18 NZD. Amounts reconciled from the published order (claims sum and net total). Verify on MoJ.
Claim	Landlord	Reason
Rent arrears to 2 October 2024 (less failure to mitigate	$20,814.29	Rent arrears to 2 October 2024 (less failure to mitigate
Water rates	$1,284.89	Water rates
Filing fee reimbursement	$27.00	Filing fee reimbursement
Net award	$20,166.18
Total payable by Tenant to Landlord	$20,166.18

Claims and awards in Tenancy Tribunal application 4965638 — net $20,166.18 NZD. Amounts reconciled from the published order (claims sum and net total). Verify on MoJ.
Claim	Landlord	Reason
Rent arrears to 2 October 2024 (less failure to mitigate	$20,814.29	Rent arrears to 2 October 2024 (less failure to mitigate
Water rates	$1,284.89	Water rates
Filing fee reimbursement	$27.00	Filing fee reimbursement
Net award	$20,166.18
Total payable by Tenant to Landlord	$20,166.18

Order

The tenancy of Teau Manu and Arcadia Talagi-Manu at 39 Norrie Smith Avenue, Flat Bush, Auckland 2023 is terminated, and possession is granted to [The landlord/s], at 12:00pm, Monday 7 October 2024.
Teau Manu and Arcadia Talagi-Manu must pay [The landlord/s] $20,166.18 immediately, calculated as shown in the table below.
The Bond Centre is to pay the bond of $1,960.00 ([Bond number suppressed]) to [The landlord/s] immediately.

Reasons

The landlord attended the hearing. The tenant did not.
The landlord has applied for termination of the tenancy, rent arrears, refund of the bond and reimbursement of the filing fee.
As the applicant, the landlord must prove each claim to the civil law standard of proof, on the balance of probabilities. Termination
The landlord’s application was filed on 8 August 2024. Rent arrears totalled $20,635.72 (222 days) on this date. Rent was at least 21 days in arrears on the date the application was filed. The tenancy is terminated. See section 55(1)(a) Residential Tenancies Act 1986 (RTA).
The landlord agreed to set the termination date at 12:00pm, Monday 7 October 2024, to allow the tenant some time to pack their belongings, clean and vacate the premises. Water rates
The landlord provided invoices from the water rates authority, which prove the amount owing, namely $1,284.89. Rent arrears and landlord’s failure to mitigate loss
The landlord provided a rent summary which proves the amount owing at the date of the hearing, namely $25,092.86. I have made an order that the tenant pay rent arrears of $16,728.57. In doing so, I have reduced the amount of rent arrears sought by the landlord by one third. This is because I consider that from 3 January 2024, the landlord did not take reasonable steps to mitigate their loss or act reasonably, having regard to all the circumstances of the case. My reasons for this are detailed below. Background
The tenancy began on 23 November 2019.
The landlord gave evidence that throughout the tenancy, the tenant had fallen into arrears, but was always able to catch up of their own accord. In early 2023 however, the landlord took the steps to request a mediation hearing regarding rent arrears. The tenant attended the mediation and the parties agreed upon a payment plan. The tenant cleared the arrears on 7 June 2023 before immediately falling into arrears again on 14 June 2023. By 19 July 2023, the tenant owed $1,950.00 in rent, which they paid in full on this date. The tenant then immediately fell into arrears again on 26 July 2023. From 26 July 2023, rent arrears climbed steadily from $650.00 to $25,092.86 by the date of the hearing. Throughout this period, the tenant made sporadic payments of $650.00 and two lump sum payments of $1,300.00 on 19 June 2024 and $1,650.00 on 3 July 2023. There were periods of three weeks or more where the tenant made no payments at all.
When asked what steps the landlord had taken to try to recover the outstanding rent, the landlord advised that they had regularly communicated with the tenant about the arrears. The landlord stated that the tenant always promised to pay the arrears, but never did. The landlord stated that they believed the tenant would pay the arrears, as the tenant had always made good on their promise to clear the arrears in the past. The landlord wanted to give the tenant a chance to pay the arrears, rather than seek an order for termination, because the tenant looked after the property well. On 17 June 2024, the landlord served the tenant with a 14-day notice to remedy rent arrears of $19,500.00. After sending this notice, the landlord gave evidence that a payment plan was discussed and agreed with the tenant. The tenant agreed to make the following payments towards rent and arrears: a. 03/07/2024: $1,650.00 b. 10/07/2024: $1,300.00 c. 17/07/2024: $1,650.00 d. 24/07/2024: $1,300.00 e. 31/07/2024: $1,650.00 f. 07/08/2024: $1,300.00 g. 14/08/2024: $1,650.00 h. 21/08/2024: $1,300.00 i. 04/09/2024: $1,300.00 j. 11/09/2024: $1,650.00 k. 18/09/2024: $1,300.00 l. 25/09/2024: $1,650.00 m. 02/10/2024: $1,300.00
The tenant made the first payment of $1,650.00 on 3 July 2024, but did not make any other payments after that. The landlord finally applied to the Tribunal for a termination order on 8 August 2024. Rent arrears were $20,635.72 on this date. The law
Section 49 RTA provides that: Where any party to a tenancy agreement breaches any of the provisions of the agreement or of this Act, the other party shall take all reasonable steps to limit the damage or loss arising from that breach, in accordance with the rules of law relating to mitigation of loss or damage upon breach of contract.
In Huang v Ashworth [2024] NZDC 15726, the District Court helpfully summarised the law regarding mitigation of loss in the context of the RTA as follows: [8] If either the landlord or tenant breaches the provisions of the tenancy agreement or the Act, the other party must take reasonable steps to minimise any loss arising from that breach. Accordingly, where the tenant fails to pay rent owing, there is an obligation on the landlord to mitigate the loss. This can be achieved by not allowing the arrears to continue to accrue, instead ending the tenancy and reletting the premises thereby preventing ongoing loss. [9] The rules that apply to mitigation of loss were described by Lord Haldane in British Westinghouse Electric and Manufacturing Co v Underground Electric Railway Co of London, as follows: [T]he law does not allow [a claimant] to recover damages to compensate him for his loss which would not have been suffered if he had taken reasonable steps to mitigate his loss. Whether a claimant has failed to take reasonable steps to mitigate is a question of fact dependent upon the particular circumstances of each case. [10] The learned author of Law of Contract in New Zealand puts it this way: The burden which lies on the defendant of proving that the plaintiff has failed in his or her duty of mitigation is by no means a light one, for this is a case where a party already in breach of contract demands positive action from one who is often innocent of blame. [11] Of relevance is s 55(1)(a) of the Act, which contains the power for a landlord to end a tenancy where rent is more than 21 days in arrears. In Housing New Zealand v Witika the landlord, Housing New Zealand, had allowed five months of arrears of rent to accumulate before it took steps to terminate the tenancy. In the Tribunal the adjudicator applied a “standard practice” of limiting rent arrears to 6 – 8 weeks on the basis that allowing rent arrears to accrue significantly beyond 21 days was indicative of a failure to mitigate loss. He awarded Housing New Zealand only $1760 of the $2256.43 arrears of rent claimed. In the District Court Judge Kerr overturned that decision. On appeal it was held that Housing New Zealand had acted reasonably in relation to the tenant given its position as the provider of state housing. It should not be restricted in its ability to recover the full amount of rent arrears on the basis of a failure to mitigate loss. Judge Kerr concluded: The learned adjudicator, as a matter of practice, seems to have dealt with claims for arrears by fixing an allowance of up to six weeks or two months worth of arrears as being the maximum allowable in any claim. In my view, that artificially creates a ceiling, which in terms of the principles relating to mitigation should not be created. If mitigation of damages is to be based on all the circumstances of the case and on the factual situation pertaining, then each case must be treated on its own merits, and to adopt a practice which may have the effect of tying an adjudicator’s hands in my opinion is not appropriate. [11] The Court held there is a duty to mitigate any loss by ensuring rent does not get too far in arrears. The test of what is required by the landlord to mitigate loss is a factual one that requires the Court to consider: (a) whether the landlord took all reasonable steps to mitigate its loss; and (b) more particularly, whether it acted reasonably having regard to all the circumstances of the case. [12] Judge Kerr avoided imposing an artificial ceiling on the amount of arrears a landlord can let build up but clearly indicated that there is a duty to mitigate when the rent goes into arrears. [13] On one view Judge Kerr appears to be placing a gloss on the obligation to mitigate for an organisation such as Housing New Zealand. This is because under s 3B(a)(i) of the Housing Corporation Act 1974, one of the objectives of Housing New Zealand is to exhibit “a sense of social responsibility by having regard to the interests of the community in which it operates.” As the main provider of social housing in New Zealand at the time, it may considered as contrary to Housing New Zealand’s social obligation to promptly evict tenants who cannot pay their rent. My view is that this analysis by Judge Kerr is an excellent illustration of the need to assess reasonable steps with regard to all the circumstances of the case. Applying that approach to this case, I do not consider that a landlord who has made a considered and sympathetic decision to allow a tenant to have more time to pay arrears should be prejudiced if payment is not made.
The case of Huang v Ashworth involved a tenancy that began in 2019 and ended on 3 January 2023. Throughout a significant period of the tenancy, the tenant had not paid the full amount of rent. As of March 2022, the tenant was 13 weeks behind in rent. Arrears continued to accrue throughout 2022 until the tenancy ended on 3 January 2023. The landlord sought an order for $10,000.00 for rent arrears.
The landlord in Ashworth had engaged in ongoing discussion with the tenant about payment of the arrears. At different times, arrangements were put in place for the tenant to pay the arrears. The tenant made numerous promises to the landlord to pay the arrears and would sometimes “top up” their rental payment to reduce the arrears. Based on the tenant’s multiple promises, the landlord allowed the tenant more time to pay the arrears, rather than seeking eviction. The District Court found the landlord’s attempts to resolve the issue of rent arrears without resorting to eviction reasonable, but only up to a point. At paragraph [18], the District Court stated: [18]... Where a tenant repeatedly breaches promises to make up arrears and instead additional arrears are incurred there comes a point where it is being naïve or careless to your own interests to persist giving the tenant more time to pay. For that reason, I do not consider that the full arrears can be claimed. In other words I am satisfied on balance of probabilities that there was some failure to mitigate loss...”
The District Court considered a reduction of one third of the total rent arrears claimed to be a reasonable reflection of the landlord’s failure to mitigate their loss. Application of law to the present case
As in Ashcroft, it cannot be said that the landlord in the present case took no steps to recover the amount owed. They were in constant communication with the tenant about the arrears. The tenant always promised to catch up on the rent owed. At times, the tenant would clear the arrears as promised, before immediately falling behind again. The landlord discussed various payment plans with the tenant who agreed, but never followed through or stuck to the repayments for very long.
The length of the tenancy in the present case was close to 5 years. This is slightly longer than the tenancy in Ashcroft. Given the length of the tenancy, the fact that the tenant sometimes followed through with their promises to pay, and the trust that the landlord reposed in the tenant to pay the arrears, I consider the landlord’s attempts to resolve the issue without resorting to eviction were reasonable, but only up to a certain point.
By 2 January 2024, rent arrears totalled $7,800.00 (84 days). The tenant had been consistently accruing rent arrears since 26 July 2023, which is a period of almost six months. During this time, the tenant only paid one weeks’ worth of rent every other week and only made two additional “top up” payments of $400.00 on 28 August 2023 and $250.00 on 7 September 2023. By 3 January 2024, it should have been clear to the landlord that the tenant was never going to pay the arrears and was only going to continue falling further behind in their payment of rent. I find that from 3 January 2024 onwards, it became naïve or careless to the landlord’s own interests to persist in giving the tenant more time to pay. The landlord only filed an application for termination on 6 August 2024, when rent arrears were $20,635.72 (222 days). In waiting so long, I find that on the balance of probabilities, the landlord did not take reasonable steps to mitigate their loss.
Between 2 January 2024 and 8 August 2024, which is the period I consider the landlord did not take reasonable steps to mitigate their loss, the total arrears accrued was $12,835.72. One third of this figure is $4,278.57. I consider a reduction of $4,278.57 from the total arrears claimed by the landlord to be a reasonable reflection of their failure to mitigate loss. The tenant is ordered to pay rent arrears of $20,814.29. Filing fee
Because [The applicant/s] has substantially succeeded with the claim I have reimbursed the filing fee.

Tenancy Tribunal case 4965638 — Rent arrears at 39 Norrie Smith Avenue, Flat Bush, Auckland 2023

At a glance

Tenancy Tribunal case 4965638 — Rent arrears at 39 Norrie Smith Avenue, Flat Bush, Auckland 2023

At a glance

Award balance

Claims & awards

Order

Reasons

Topics & place

Residential Tenancies Act sections

Key findings

Frequently asked questions

Award balance

Claims & awards

Order

Reasons

Topics & place

Residential Tenancies Act sections

Key findings

Frequently asked questions