What was Tenancy Tribunal case 5138230 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 5138230?

Verified claim lines are listed on this page.

What type of tenancy dispute was case 5138230?

The dispute type was not classified.

Where can I read the official tribunal order for case 5138230?

The official Ministry of Justice published order is available at https://forms.justice.govt.nz/search/Documents/TTV2/PDF/11433052-Tribunal_Order_Redacted.pdf.

What was Tenancy Tribunal case 5138230 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 5138230?

Verified claim lines are listed on this page.

What type of tenancy dispute was case 5138230?

The dispute type was not classified.

Where can I read the official tribunal order for case 5138230?

The official Ministry of Justice published order is available at https://forms.justice.govt.nz/search/Documents/TTV2/PDF/11433052-Tribunal_Order_Redacted.pdf.

Unit/Flat 6, 10 Newington Road, Henderson, Auckland 0612 Tenancy Tribunal Case 5138230 — Tenancy dispute

Order

An application for suppression has been made in this case, and the Tribunal orders suppression of the tenants’ names and identifying details.
The term of the tenancy is reduced and the tenancy will end at 11:59pm on Thursday 20 February 2025.

Reasons

Both parties attended the hearing which was held by video conference.
The tenants were represented by [Tenant 1].
The tenants seek an order are reducing the term of their fixed term tenancy under s.66 RTA which provides as follows: “On application by a party to a fixed-term tenancy, the Tribunal may make an order reducing the term of the tenancy by a period stated in the order, and making such variations in the terms of the tenancy as are necessary because of the reduction of the term, where it is satisfied that, because of an unforeseen change in the applicant’s circumstances, the severe hardship which the applicant would suffer if the term of the tenancy were not reduced would be greater than the hardship which the other party to the tenancy would suffer if the term were reduced.”
Section 49 RTA is also relevant. It requires parties to take reasonable steps to mitigate losses resulting from another parties’ breach. There is no criticism by the tenants of the efforts made by the property managers to try and find new tenants for the premises and they are grateful that their bond has been refunded to them before the end of the tenancy. I am satisfied that the landlord has taken reasonable steps to mitigate the situation. Background
On 7 May 2024 the parties entered into a fixed term tenancy agreement for the premises, for a term from 10 May 2024 to 29 May 2025 at a rent of $600.00 per week.
Prior to that date the tenants had committed to purchase of a new build property which was expected to have a completion date at the end of March 2025.
The tenancy was entered into by the tenants because [Tenant 1] was required to spend 12 months training in Henderson. Unexpectedly, that training period was shortened and she was required to return to [City].
In October 2024 the tenants told the landlord about those changed circumstances and that they would be needing to return to [City] at the end of the year.
The tenants took a tenancy in [City] at $300.00 per week and vacated the premises on 21 December 2024.
The landlord began advertising the property during November but says that the residential rental market in Henderson has been in a state of oversupply and it has not yet been able to secure new tenants for the premises.
It notes that the premises have been sold, with the new owner taking ownership during January. At the time the sale was agreed, the previous owner was aware of the tenants’ circumstances and that they would be moving out at the end of December but this application had not then been brought.
The property manager has been appointed by the new owner but has not yet discussed with the owner options such as offering the premises for rent at a lower rental on the basis that the tenants contribute to the rental shortfall. The property manager says those discussions with the new owner will likely take place soon.
The tenants’ position is that they are now required to pay $600.00 per week in rent for these premises as well as $300.00 per week for the rental property they had to take in [City]. As well they say that the settlement date for the property they have purchased has been unexpectedly brought forward so they will also have to begin servicing that mortgage from around 20 February 2025. The unexpected move back to [City] has negatively impacted on [Tenant 2’s] income. The tenants’ say that the combination of those commitments and circumstances puts them in a position of severe financial hardship.
For its part, the property managers point out that the new owner bought the premises with the tenancy in place and if the fixed term is ended early with no alternative tenants having been found, that will create a loss of rent for the new owner. Analysis
The evidence satisfies me that: a. there has been an unforeseen change in the tenants’ circumstances; and b. due to that change in circumstances, the tenants face the prospect of having to pay rent for two dwellings and the mortgage on another, with less than anticipated income, causing them severe hardship.
What I am then required to decide is whether the severe hardship the tenants would suffer if the term isn’t reduced, is greater than the hardship the landlord would suffer if it is.
The possible loss of rent to the owners if the fixed term is reduced, is apparent.
The landlord has not provided evidence of the extent to which that would cause the owner hardship, which is a key consideration in applying s.66.
I have no evidence as to the owner’s financial position. I do not know whether recovering possession of the premises early might allow them to proceed earlier with necessary work to the premises, whether it might provide accommodation for friends or family or other opportunities to mitigate their loss.
I also take into account that the owner bought the premises after the tenants had given notice that they needed to leave and wanted to end the fixed term early. The owner had the opportunity to factor that risk into the terms for purchase of the property.
The evidence is that the critical hardship for the tenants will arise when they are required to begin mortgage payments on around 20 February 2025.
While it is correct that the primary obligation is on the tenants to honour their fixed term agreement, by that date the landlord will have had 4 months’ notice of the unexpected change in the tenants’ circumstances that meant they would have to vacate early, of which there has been 2 months with vacant possession available.
In those circumstances, particularly with no evidence to show that the owner will be caused hardship by early termination of the tenancy, I find it just that the Tribunal exercise its discretion and end the tenancy effective Thursday 20 February 2025.
No Order is made in respect of the filing fee.

Reasons

Both parties attended the hearing which was held by video conference.

The tenants were represented by [Tenant 1].

The tenants seek an order are reducing the term of their fixed term tenancy under s.66 RTA which provides as follows: “On application by a party to a fixed-term tenancy, the Tribunal may make an order reducing the term of the tenancy by a period stated in the order, and making such variations in the terms of the tenancy as are necessary because of the reduction of the term, where it is satisfied that, because of an unforeseen change in the applicant’s circumstances, the severe hardship which the applicant would suffer if the term of the tenancy were not reduced would be greater than the hardship which the other party to the tenancy would suffer if the term were reduced.”

Section 49 RTA is also relevant. It requires parties to take reasonable steps to mitigate losses resulting from another parties’ breach. There is no criticism by the tenants of the efforts made by the property managers to try and find new tenants for the premises and they are grateful that their bond has been refunded to them before the end of the tenancy. I am satisfied that the landlord has taken reasonable steps to mitigate the situation. Background

On 7 May 2024 the parties entered into a fixed term tenancy agreement for the premises, for a term from 10 May 2024 to 29 May 2025 at a rent of $600.00 per week.

Prior to that date the tenants had committed to purchase of a new build property which was expected to have a completion date at the end of March 2025.

The tenancy was entered into by the tenants because [Tenant 1] was required to spend 12 months training in Henderson. Unexpectedly, that training period was shortened and she was required to return to [City].

In October 2024 the tenants told the landlord about those changed circumstances and that they would be needing to return to [City] at the end of the year.

The tenants took a tenancy in [City] at $300.00 per week and vacated the premises on 21 December 2024.

The landlord began advertising the property during November but says that the residential rental market in Henderson has been in a state of oversupply and it has not yet been able to secure new tenants for the premises.

It notes that the premises have been sold, with the new owner taking ownership during January. At the time the sale was agreed, the previous owner was aware of the tenants’ circumstances and that they would be moving out at the end of December but this application had not then been brought.

The property manager has been appointed by the new owner but has not yet discussed with the owner options such as offering the premises for rent at a lower rental on the basis that the tenants contribute to the rental shortfall. The property manager says those discussions with the new owner will likely take place soon.

The tenants’ position is that they are now required to pay $600.00 per week in rent for these premises as well as $300.00 per week for the rental property they had to take in [City]. As well they say that the settlement date for the property they have purchased has been unexpectedly brought forward so they will also have to begin servicing that mortgage from around 20 February 2025. The unexpected move back to [City] has negatively impacted on [Tenant 2’s] income. The tenants’ say that the combination of those commitments and circumstances puts them in a position of severe financial hardship.

For its part, the property managers point out that the new owner bought the premises with the tenancy in place and if the fixed term is ended early with no alternative tenants having been found, that will create a loss of rent for the new owner. Analysis

The evidence satisfies me that: a. there has been an unforeseen change in the tenants’ circumstances; and b. due to that change in circumstances, the tenants face the prospect of having to pay rent for two dwellings and the mortgage on another, with less than anticipated income, causing them severe hardship.

What I am then required to decide is whether the severe hardship the tenants would suffer if the term isn’t reduced, is greater than the hardship the landlord would suffer if it is.

The possible loss of rent to the owners if the fixed term is reduced, is apparent.

The landlord has not provided evidence of the extent to which that would cause the owner hardship, which is a key consideration in applying s.66.

I have no evidence as to the owner’s financial position. I do not know whether recovering possession of the premises early might allow them to proceed earlier with necessary work to the premises, whether it might provide accommodation for friends or family or other opportunities to mitigate their loss.

I also take into account that the owner bought the premises after the tenants had given notice that they needed to leave and wanted to end the fixed term early. The owner had the opportunity to factor that risk into the terms for purchase of the property.

The evidence is that the critical hardship for the tenants will arise when they are required to begin mortgage payments on around 20 February 2025.

While it is correct that the primary obligation is on the tenants to honour their fixed term agreement, by that date the landlord will have had 4 months’ notice of the unexpected change in the tenants’ circumstances that meant they would have to vacate early, of which there has been 2 months with vacant possession available.

In those circumstances, particularly with no evidence to show that the owner will be caused hardship by early termination of the tenancy, I find it just that the Tribunal exercise its discretion and end the tenancy effective Thursday 20 February 2025.

No Order is made in respect of the filing fee.

Tenancy Tribunal case 5138230 — Tenancy dispute at Unit/Flat 6, 10 Newington Road, Henderson, Auckland 0612

At a glance

Claims & awards

Tenancy Tribunal case 5138230 — Tenancy dispute at Unit/Flat 6, 10 Newington Road, Henderson, Auckland 0612

At a glance

Claims & awards

Order

Reasons

Topics & place

Residential Tenancies Act sections

Frequently asked questions

Order

Reasons

Topics & place

Residential Tenancies Act sections

Frequently asked questions