Need Advice re. Tenancy Tribunal Hearing

[antzy]

Hi All,

I am new to this forum. I need your kind advice for upcoming tenancy tribunal hearing from couple of my greedy tenant. Before I start, I need to let you know that I seriously forgot to lodge my bond this time which I always did in the past. I know not lodging the bond is an unlawful act and it is a big set back for me.

Here's a brief story of what happened:

I took 4 tenants which signed a 6 months fixed term tenancy. They all signed the tenancy agreement. Two months later, 2 tenants decided to move out of the flat without finding a replacement. They pretty much just walked out on the other flatmates. They contacted me to get their bond back and I told them that I can not release bond unless the contract is finish or if they find a replacement, the replacement tenant can give them their bond. 3 weeks later, replacement tenants was found and 1 week bond was given back to them by their ex-flatmates.
Now, they are not happy that they only get 1 week bond back and filed an application to TT saying that their bond was not lodged and they want compensation.
This is clearly a dispute between tenants and unlucky enough for me, I forgot to lodge the bond now it is my problem.

I never had any issue in the past and this is new to me. Could anyone give me any advise of what to do or what to prepare in the hearing.

Many thanks,

Antzy

[jimO]

so what did you do with the bond you forgot to lodge?

[antzy]

Thanks for you reply jimO. The bond has now been lodged.

[artemis]

The TT makes up rules as it goes along, so who knows what their decision will be. However, you should make sure you say that non-lodgement was a one off and perhaps provide a list of previous bonds lodged with date lodged and tenancy start dates to support this. Seems the TT comes down harder on professional property managers who make a habit of it.

You could also include in your response what (if any) financial impact this had on the tenants. If none or negligible that could (should) be considered when setting any compensation. They may well be entitled to another week bond back from a new tenant so that seems to me not a financial loss that can be pinned on the landlord.

Have you lodged a change of tenant form?

[Wayne]

If the 2 people pay for the 3 weeks rent they owed they could have all their bond back.

I second artemis though. You could lose out and learn a lesson - always lodge the bond, do not forget!!

[antzy]

The TT makes up rules as it goes along, so who knows what their decision will be. However, you should make sure you say that non-lodgement was a one off and perhaps provide a list of previous bonds lodged with date lodged and tenancy start dates to support this. Seems the TT comes down harder on professional property managers who make a habit of it.

You could also include in your response what (if any) financial impact this had on the tenants. If none or negligible that could (should) be considered when setting any compensation. They may well be entitled to another week bond back from a new tenant so that seems to me not a financial loss that can be pinned on the landlord.

Have you lodged a change of tenant form?

Thanks for your kind advice Artemis. I will explain to TT that this non lodgement is a one off as well as the financial impact.

No, I have not yet lodged a change of tenant form. Any advice on how to do this? Sorry, im quite new to this as I never had tenant that moves out during their fixed term.

By the way, Im just wondering what are the consequences for tenants that break their fixed term contract?

Thanks,

Antzy

[antzy]

If the 2 people pay for the 3 weeks rent they owed they could have all their bond back.

I second artemis though. You could lose out and learn a lesson - always lodge the bond, do not forget!!

Thanks for your reply. I have learnt my lesson, if I lodged the bond this time, this would have been dispute between tenants and nothing to do with Landlord.

[Tantalus]

consequences for tenants that break their fixed term contract? ... At best you may get an order for lost rent. You might also apply for exemplary damages as abandonment is an unlawful act, but in my very limited experience the TT will bend over backwards to favour the tenant who may not in fact even appear at any hearing.

[artemis]

Thanks for your kind advice Artemis. I will explain to TT that this non lodgement is a one off as well as the financial impact. No, I have not yet lodged a change of tenant form. Any advice on how to do this? Sorry, im quite new to this as I never had tenant that moves out during their fixed term. By the way, Im just wondering what are the consequences for tenants that break their fixed term contract? Thanks, Antzy

The change of tenant form is here:

http://www.dbh.govt.nz/UserFiles/File/Publications/Tenancy/pdf/change-of-tenant-form.pdf

It is a joint landlord / old tenant / new tenant exercise. All parties complete the form and it goes to Tenancy Services, who change the names on the bond record. We, as landlords. initiate and help tenants through the process to make sure it happens. It is mainly for the tenants benefit as it sorts out bond refunds at tenancy end. but they can be quite slack.

As the tenants who left were on the fixed term tenancy agreement then they needed to get your agreement or an order from the Tenancy Tribunal to leave. In either case, it would be expected that they remain responsible for rent until a new tenant acceptable to you moves in. They broke their contract so I doubt the TT would be very sympathetic.

Were you short on the rent because they left? If so, you can counter claim for that.

Just also to say, we don't do fixed term contracts. I think they are more trouble than they are worth. Fact is, people will move out for lots of reasons, and the LL either agrees or gets into a messy situation in which they may or may not recover any money owed. Periodic tenancies are much simpler to manage.

[flyernzl]

Agreed.

Fixed term tenancies may work for million-dollar homes rented to large corporates for their executives, but for your average run-of-the-mill tenancy, forget it.

The tenant loses very little - after all, all they have to do is stop paying the rent and you will want them out before the tenency expires anyway.

For the Landlord, a fixed term just means that you lose the right to issue a 90-day notice, which is a big loss of power.