What was Tenancy Tribunal case 5098817 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 5098817?

Filing Fee: $27.00 awarded to tenant

What type of tenancy dispute was case 5098817?

The dispute type was not classified.

Where can I read the official tribunal order for case 5098817?

The official Ministry of Justice published order is available at https://forms.justice.govt.nz/search/Documents/TTV2/PDF/11436643-Tribunal_Order_Redacted.pdf.

What was Tenancy Tribunal case 5098817 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 5098817?

Filing Fee: $27.00 awarded to tenant

What type of tenancy dispute was case 5098817?

The dispute type was not classified.

Where can I read the official tribunal order for case 5098817?

The official Ministry of Justice published order is available at https://forms.justice.govt.nz/search/Documents/TTV2/PDF/11436643-Tribunal_Order_Redacted.pdf.

New Zealand Tenancy Tribunal Case 5098817 — Tenancy dispute

Claims and awards in Tenancy Tribunal application 5098817 — net $27.00 NZD. Amounts reconciled from the published order (claims sum and net total). Verify on MoJ.
Claim	Tenant	Reason
Filing fee reimbursement	$27.00	Filing fee reimbursement
Net award	$27.00
Bond	$2,520.00
Total payable by Landlord to Tenant	$27.00

Claims and awards in Tenancy Tribunal application 5098817 — net $27.00 NZD. Amounts reconciled from the published order (claims sum and net total). Verify on MoJ.
Claim	Tenant	Reason
Filing fee reimbursement	$27.00	Filing fee reimbursement
Net award	$27.00
Bond	$2,520.00
Total payable by Landlord to Tenant	$27.00

Order

An application for suppression has been made in this case, and the Tribunal orders suppression of the Tenants’ name and identifying details.
The term of the fixed-term tenancy of [tenants names suppressed] at [address suppressed] is reduced and now ends at 11:59pm on 21 October 2024.
Veenay Rambisheswar must pay [The tenants] $27.00 immediately, as calculated in the table below:
The Bond Centre is to pay the bond of $2,520.00 () to [tenants name suppressed] immediately.

Reasons

Both parties attended the hearing.
The tenants applied for reduction of the fixed-term tenancy due to end on 26 December 2024, refund of the bond and reimbursement of the filing fee.
The landlord made a cross application for rent arrears, refund of the bond and reimbursement of the filing fee.

Should the fixed term tenancy be ended early?

The parties entered into a fixed term tenancy for a period of 12 months for the period 26 December 2023 to 26 December 2024.
The tenants submitted that they had no intention of ending the fixed term early as they liked the premise, had busy jobs, were planning and saving for a wedding and had a one-month trip planned for the last part of the year.
The tenants produced evidence that they were informed by the landlord’s property manager on 5 March 2024, not quite three months into a twelve-month fixed term tenancy, that the owner of the property “was thinking about selling the unit”. This was followed by an email on 5 July 2024 from the landlord saying: “I understand you are on a fixed term lease, however I had requested if this could be ended earlier due to severe financial hardship. As prospective buyers are owners/occupiers the property would need to be handed over to the new owners once the sale and purchase agreement is signed. Therefore, I am officially writing to you to update you that my property [address suppressed] is for sale. Note this was offered to you as the first option to buy. I realise the request to end the lease earlier may be inconvenient to you. As a result, I had relayed via my property manager Liam a few options to help you. I am willing to pay for your shift to a new location in Glenfield including paying the rent difference up to December as per your original lease, so this will not have any financial impact as part of my offer. I have also looked at a similar property near your current location which has slightly higher rent as your current rent paid is below market. Please refer to the link below for details of the 2-bedroom townhouse on [address suppressed], which is the next road off [address suppressed]. This is only 550m from your current location-refer attached map”.
The tenants were shocked at this request but wanted to try to accommodate the landlord’s needs and replied: Sorry to hear about your financial position. We understand this is not a convenient situation for you at the moment. However, we are currently not in a situation to move. My fiancé and I are both working long hours, planning a wedding, and also going to be away for a month later in the year. Thank you for the link but we are not interested in that property. We will start to look for a property ourselves”.
In this response the tenants have accepted that they are required to move out before the end of the lease because the landlord needs the property back earlier to facilitate a faster sale of the property to the prospective buyers he has lined up. They are also clear that they are going to proactively start to look for a suitable property to move to and are signalling they may not be able to find somewhere straight away, as they have other commitments that will make it hard for them to get out and look for a place to live immediately. They are clear that they will start to look for a new place to live.
The tenants then began to immediately act on the landlord’s formal notice that he is selling the property and needs them to move out so he can give the prospective buyers he has lined up vacant possession when the sale and purchase agreement is concluded. They gave evidence that they started to look at rental properties and at the same time they applied for a mortgage so they could ascertain if they could purchase a house. Once their application for a mortgage was approved, they started to search for a house to buy, based on the landlord’s offer to release them from the fixed term tenancy earlier. The tenants submitted that but for the landlord’s promise to support them being released from the fixed term earlier, by paying moving costs and the difference in rental rates, they would never have started the process of buying a house until the end of the fixed term tenancy.
The landlord clearly understood that the tenants were looking to vacate as early as they could and that they were looking to buy a home when he replied: “Also, if you are still interested in purchasing I can offer $25,000.00 deposit now with settlement in December plus you can save as I will not charge you rent for 5 months, I will still pay insurance and rates”
Based on this email, the tenants’ belief was reinforced that the landlord would do anything to support them to move out earlier than the end of the fixed term.
The tenants then informed the landlord on 21 August 2024 that: a. They had found a place to buy; b. The offer they had made had been accepted; c. Their sale and purchase agreement would go unconditional on 2 September 2024; d. Settlement is on 4 October 2024; e. They cannot move out before the settlement date as they are overseas for a month. f. They believe that this will be beneficial to the as he wanted them to vacate early to help him to sell the house as soon as possible.
It was only at this point that the landlord then attempts to hold the tenants to the fixed term tenancy agreement.
The tenants acted on the landlord’s request for them to end the fixed term tenancy early, led them to believe he had prospective buyers that would want vacant possession of the property before the end of the fixed term lease and offered generous incentives for them to move out earlier than the end of the fixed term lease. The tenants acted on the landlord’s promise to support them to end the fixed term lease early, to their detriment. He is now asking the Tribunal to award him the $5,940.00 lost rent he had incurred as he still has not sold the house and has not put new tenants into the property he is still trying to sell.
The landlord has confirmed he has to pay $4,000.00 per month in mortgage repayments and is experiencing severe financial hardship as a result of having to repay this debt on top of his other expenses.
The tenants have confirmed that they have gone through their savings by buying a house and paying for a wedding and all of their earnings are committed to the repayment of their mortgage and their day to day living costs. They are not in a financial position to also pay back a $5,940.00 debt and would suffer severe financial hardship if they were forced to pay the rent to the end of a fixed term tenancy that they were under the belief they had been released from when they took on their mortgage. Especially when the landlord had assured them they would not suffer any financial disadvantage if they ended the tenancy early, to allow him to sell the property unfettered by having tenants living in the house until 26 December 2024. The law
Parties enter into a fixed term tenancy for security. For tenants this is security of tenure; they can be sure they have a home for at least the agreed term. For landlords it is security of income; they can rely on a set amount of income from their investment.
If a landlord wishes to default on that contract, and the tenants accept the repudiation, then the tenancy ends on the terms agreed. In such a situation of surrender the tenants can stipulate the terms of early surrender provided they are reasonable. Such reasonable terms can be to ensure the aggrieved party (here the tenants) be placed in the same position as they would have been in, but for the breach of the tenancy agreement.
If the parties cannot agree to end the tenancy, it is open to that party to apply to the Tribunal to reduce the term pursuant to section 66(1) RTA.
The Tribunal can 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.
Section 66 sets a high threshold for reducing fixed term tenancies. The jurisdiction in this section is an extension to the doctrine of frustration found in the general law of contract. In most cases, s66 is used to seek a balance between the competing interests of applicant tenants, for whom significant obligations under fixed term agreements can create severe hardship when circumstances unexpectedly turn against them, and landlords, who have financial obligations and expectations of their own arising from the same bargain.
The term “unforeseen” is a legal term defined by reference to the reverse (“foreseeability”) in cases relating to negligence (in determining whether a duty of care is owed and what damages are reasonably foreseeable) and in cases assessing damages for breach of contract (also in assessing the remoteness of damage). In both contexts, there is a body of case law which has established that: a. Foreseeability must be assessed objectively through the eyes of a reasonable person who has taken all reasonable steps to inform himself of the circumstances; b. an outcome is foreseeable in legal terms if it is “liable to result”, “not unlikely”, “quite likely”, a “real danger”, a “serious possibility” or a “real risk”; c. The term “unforeseen” has few if any direct dictionary definitions, but by thesaurus is aligned with such concepts as “unexpected” and “without warning”. In a legal context, it must also be taken as the reverse of what is “foreseen”, thus being “not liable to result”, “unlikely”, “not a real danger”, “not a serious possibility” or “not a real risk”.
As an alternative to ending the tenancy, pursuant to s66 of the RTA, the Tribunal may also consider ending a tenancy such as this one under the doctrine of equitable estoppel.
Promissory estoppel provides a common law equitable remedy when a person has relied upon another person’s promise to their own detriment. When someone makes a claim on the basis of promissory estoppel, they need to prove five elements in order to establish a legal interest. Specifically, there must be: a. A legal relationship between the parties, most commonly established through a contractual agreement; b. A promise or assurance that was reasonably believable in the circumstances; c. Reliance on the promise or assuarnce that was justifiable in the circumstances; d. Detriment as a result of the person relying on the promise or assurance; and e. It would be unconscionable for the person to be allowed to get away with reneging on their promise. Analysis & findings
Based on all the evidence provided, I find that the landlord should be estopped from relying on the fixed term agreement to require the tenants to pay the rent to 26 December 2024, when: a. The landlord had given them an assurance that they could end the fixed term tenancy early as he was selling the property and needed to be able to give his prospective buyers vacant possession as soon as possible, and that was likely to be before the end of the tenants fixed term tenancy; b. The landlord’s offer to end the fixed term tenancy, and to financially support the tenants to move out earlier so that they would not be financially penalised, was reasonably believable in all the circumstances; c. The tenants relied on the landlord’s offer and assurances and their reliance was justifiable in the circumstances; d. The tenants would suffer a detriment as a result of the person relying on the landlord’s assurance and offer to mitigate any financial repercussions to the tenants of ending the fixed term tenancy early; and e. It would be unconscionable for the landlord to be allowed to get away with reneging on his assurance that the tenants would not be financially penalised for ending the fixed term tenancy early, when they would not have done so, but for his assurances.
I end the fixed term tenancy based on the doctrine of promissory estoppel from 11:59pm on 21 October 2024.
I also note that the evidence shows the landlord’s financial position was going to allow him to cover the tenants rent shortfall for five months and their moving costs and also would have allowed him to let them live rent free for five months in the premise if they purchased it from him in July 2024.
On the contrary, the tenants have gone through all their savings purchasing a house and paying for a wedding and they have no other financial means to repay $5,940.00 to the landlord in rent arrears.
Therefore, in the alternative, even if I had not reduced the fixed term of the tenancy on the basis of promissory estoppel, I would have ended it based on the evidence that the tenants would suffer greater financial hardship than the landlord who has an asset that he will be able to sell and repay any debt incurred, where the tenants could loose their new home if they were to be made to pay the landlord the $5,940.00 rent arrears they incurred solely because of his request for them to end the fixed term early.
The parties have confirmed that the rent was fully paid to 21 October 2024. Therefore, there are no rent arrears. Reimbursement of filing fee
Because [The applicants] have wholly succeeded with the claim I must reimburse the filing fee. Name Suppression
The tenants apply for non-publication of their name and identifying details.
The Tribunal must, on the application of a party that has wholly or substantially succeeded in proceedings, order that the party’s name or identifying particulars not be published, unless the Tribunal considers that publication is in the public interest or is justified because of the party’s conduct or any other circumstances of the case.
The tenants have substantially succeeded in these proceedings, and I do not consider publication is in the public interest or justified because of the tenants’ conduct or any other circumstances of the case.
Non-publication of the tenants’ name is ordered.

Tenancy Tribunal case 5098817 — Tenancy dispute

At a glance

Award balance

Tenancy Tribunal case 5098817 — Tenancy dispute

At a glance

Award balance

Claims & awards

Order

Reasons

Should the fixed term tenancy be ended early?

Topics & place

Residential Tenancies Act sections

Frequently asked questions

Claims & awards

Order

Reasons

Should the fixed term tenancy be ended early?

Topics & place

Residential Tenancies Act sections

Frequently asked questions