What was the outcome of Tenancy Tribunal case 4996951?

The tribunal order states: By way of declaration, a rent reduction from $1,450 per week to $1,200 was

How much money was awarded in case 4996951?

Rent Arrears: $750.00 awarded to landlord

What type of tenancy dispute was case 4996951?

The primary dispute was Rent arrears.

Where can I read the official tribunal order for case 4996951?

The official Ministry of Justice published order is available at https://forms.justice.govt.nz/search/Documents/TTV2/PDF/10935770-Tenancy_Tribunal_Order.pdf.

What was the outcome of Tenancy Tribunal case 4996951?

The tribunal order states: By way of declaration, a rent reduction from $1,450 per week to $1,200 was

How much money was awarded in case 4996951?

Rent Arrears: $750.00 awarded to landlord

What type of tenancy dispute was case 4996951?

The primary dispute was Rent arrears.

Where can I read the official tribunal order for case 4996951?

The official Ministry of Justice published order is available at https://forms.justice.govt.nz/search/Documents/TTV2/PDF/10935770-Tenancy_Tribunal_Order.pdf.

30A St Stephens Avenue, Parnell, Auckland 1052 Tenancy Tribunal Case 4996951 — Rent arrears

Claims and awards in Tenancy Tribunal application 4996951 — net $750.00 NZD. Amounts reconciled from the published order (claims sum and net total). Verify on MoJ.
Claim	Landlord	Reason
Rent arrears 12/09/24 – 09/10/24	$750.00	Rent arrears 12/09/24 – 09/10/24
Net award	$750.00
Total payable by Tenant to Landlord	$750.00

Claims and awards in Tenancy Tribunal application 4996951 — net $750.00 NZD. Amounts reconciled from the published order (claims sum and net total). Verify on MoJ.
Claim	Landlord	Reason
Rent arrears 12/09/24 – 09/10/24	$750.00	Rent arrears 12/09/24 – 09/10/24
Net award	$750.00
Total payable by Tenant to Landlord	$750.00

Order

By way of declaration, a rent reduction from $1,450 per week to $1,200 was effective for the period commencing 20 June 2024 and ending 11 September 2024.
By way of declaration, from 12 September 2024 the rent returned to $1,450 per week.
By consent, the fixed-term tenancy of Suzanne Rachel Brown at 30A St Stephens Avenue, Parnell, Auckland 1052 will end on 28 February 2025.
Suzanne Rachel Brown must pay Abernethy & Burke Management Limited As Agent For Jackson Muir & Sophia Cranswick - The Thirty A Trust $750.00 immediately, being rent arrears from 12 September 2024 to 9 October 2024.

Reasons

Both parties attended the phone hearing.
The fixed-term tenancy commenced on 28 March 2024. The tenancy agreement records the tenancy will end on 25 February 2026. Summary of parties’ positions
The tenancy agreement records that the tenant is to pay rent in the amount of $1,450 per week. From the start of the tenancy, until 20 June 2024, the tenant paid the rent as it fell due.
Since 27 June 2024, the tenant has been paying $1,200 per week. The tenant claims a rent reduction from $1,450 to $1,200 per week was agreed on 21 June 2024 and that is why she has paid the lesser amount since. The landlord’s agent claims no rent reduction was agreed to and the full rent of $1,450 was due each week.
I heard evidence from both parties on the issue of whether a rent reduction was agreed, and if so, what the terms of the agreement were. The evidence
It is not in dispute that in May 2024, the tenant reached out to the landlord’s agent to advise she was in financial difficulties. The parties discussed the possibility of a lease assignment. On 29 May 2024, the landlord’s agent confirmed the tenant could assign the lease and provided the tenant with a draft lease assignment agreement.
The tenant did not wish to proceed with the lease assignment. On 6 June 2024, the tenant emailed the property manager asking that her rent be reduced to $1,000 per week for four weeks, followed by a rent-review. The tenant also sought to terminate her fixed-term tenancy early, although she did not specify a proposed end date.
The property manager responded to the tenant and advised her he would discuss with the landlords who reside overseas. On 21 June 2024, the property manager sent the tenant a text message in which he stated the landlords were willing to offer the tenant a rent reduction of $1,200 per week “for a limited time” and added “and option to pay off over 12 months.” The property manager then stated it would need to be recorded in a variation agreement.
Following the text exchange, the parties had a phone conversation on 21 June 2024. The parties disagree as to what occurred during that phone conversation: a. The tenant gave evidence that during the phone call the tenant and property manager agreed to a rent reduction to $1,200 per week. The tenant was unsure whether it was for 6 or 12 weeks but stated that it was temporary. The tenant believed the parties agreed to a rent review at the end of the temporary rent reduction. The tenant stated it was never discussed that she would repay the difference between the current rent and reduced rent at the end of the tenancy. b. The tenant stated she did not get any written confirmation of what she states was agreed to in the phone call on 21 June 2024, but did refer to a text message she sent to her employer after her phone call with the property manager. The tenant sent her employer a text message on 21 June 2024 at 1:19pm thanking him for his assistance and stating, “Settled on $1200 pw for 6 week review.” c. The property manager gave evidence that during the phone call on 21 June 2024, the parties did agree to a temporary rent reduction to $1,200 per week. However, the property manager says as the written variation agreement was never signed by the tenant the agreement was not “solidified” and is not binding. The property manager gave evidence that the temporary rent reduction was only offered on the basis the rent reduction each week (being $250 per week) would need to be re-paid, albeit payment could be delayed until the end of the tenancy. The property manager noted the offer to reduce the rent was subsequently withdrawn some weeks later. d. The property manager was unsure whether the temporary rent reduction that was verbally agreed to on 21 June 2024 was for 6 weeks or 12 weeks, but noted the variation agreement which he subsequently drafted and sent to the tenant recorded the rent reduction for the period 20 June 2024 to 12 September 2024 (a 12-week period). The property manager says a temporary reduction for 12 weeks is consistent with the landlord’s instructions to him, as set out in the property manager’s text message to the tenant on 21 June 2024.
The property manager gave evidence that a draft variation agreement recording the agreed temporary rent reduction was sent to the tenant for signing on 24 June 2024. The agreement was sent via electronic link. The property manager says that draft agreement was withdrawn approximately a week later as he was advised it was not the best document to use. He noted it did not provide a condition for repayment of the $250 per week in rent reduction at the end of the fixed term tenancy.
The only draft agreement produced at the hearing is dated 31 July 2024 and is marked in red as “CANCELLED”. The property manager was unable to say on what date the document was created, but stated it was cancelled on 31 July 2024. The agreement is titled “Temporary Rent Reduction Agreement” and states the rent reduction was for the period 20 June 2024 to 12 September 2024. It states the rent of $1450 per week would be reduced to $1200 per week for that period. It does not record that the parties agree to a review thereafter. Nor does it record that the tenant agrees to repayment of the $250 per week in reduced rent at the end of the tenancy. The property manager signed the agreement, however the tenant did not.
The tenant says she did not receive the link to the variation agreement to sign. The tenant said she did not hear from the property manager again until a further email from him on 25 July 2024.
On 25 July 2024, the property manager emailed the tenant setting out that the offer to reduce the fixed term tenancy remained “firmly on the table” and repeated the terms of a rent reduction as discussed on 21 June 2024, being a three-month rent reduction from $1450 to $1200 per week. The property manager then stated, “We have been instructed that any unpaid rent other than the agreed period is to be clawed back either by a payment plan or at the end of the tenancy.”
In a subsequent email on 27 July 2024, the property manager repeated the same terms of a temporary rent reduction and stated, “upon signing, the tenant must also agree to repay any shortfalls in rent up until the agreed date of the rent relief beginning, before the end of the tenancy term.”
The agreement titled “Temporary Rent Reduction Agreement” which the property manager says was sent to the tenant electronically was withdrawn on 31 July 2024.
On 15 August 2024, the property manager emailed the tenant and advised her that the landlords, “do not have any desire to reduce the rent for any period of time during the tenancy.” He stated, “Just to confirm there is no agreed rent reduction and all rent is due and is now in arrears.”
From that point, there were continuing discussions between the tenant and property manager, including a meeting which took place at the premises on 23 August 2024. The parties again differ as to what was agreed during that meeting but it is common ground that the focus was on the issue of a rent reduction.

Was there agreement to reduce the rent?

Ultimately, the issue for me to determine is whether a binding agreement to reduce the rent for a temporary period was agreed to on 21 June 2024.
Section 13B(1) of the Residential Tenancies Act states every variation of a tenancy agreement shall be in writing and signed by both the landlord and the tenant. However, section 13C states that, notwithstanding anything to the contrary in any other enactment, no tenancy agreement, or variation of a tenancy agreement, shall be unenforceable on the grounds that it is not in writing.
Section 13C is consistent with the established principle in contract law that a verbal agreement can be a binding contract if it encapsulates the crucial elements of a legally binding contract. Those elements are: a. An offer; b. Acceptance; c. Consideration; and d. A mutual intention to create a binding contract.
I am satisfied that the crucial elements of a legally binding contract were verbally agreed in the phone conversation on 21 June 2024.
An offer was made by the property manager to temporarily reduce the tenant’s rent to $1,200 per week, and that offer was accepted by the tenant. Consideration was provided by way of rent. I also find there was a mutual intention to create a binding contract; the drafting of a variation agreement is evidence of that. I discuss below my findings as to the terms of the agreement.

What were the terms of the agreement to reduce rent?

The property manager gave evidence that during the phone conversation on 21 June 2024 he did agree on behalf of the landlords to a temporary rent reduction (to $1,200 per week). Although the property manager says he is unsure what time-period was agreed, he noted it was likely a 12-week period as that is what was recorded in the draft agreement.
Accordingly, I find the parties agreed to a rent reduction from $1450 to $1200 for the period 20 June 2024 to 12 September 2024. That amount and that time- period is consistent with the property manager’s text to the tenant on 21 June 2024, as well as his emails sent on 25 July 2024 and 27 July 2024.
I am not satisfied that it was a term of the agreement that the tenant would repay the rent reduction (being $250 x 12 weeks, totalling $3000) at the end of the tenancy. That finding is consistent with the draft agreement titled “Temporary Rent Reduction Agreement” which did not contain such a clause. It is also consistent with the property manager’s emails on 25 July 2024 and 27 July 2024. In those emails the property manager referred to a condition that the tenant repay, “any shortfalls in rent up until the agreed date of the rent relief beginning” (25 July 2024), and, that “any unpaid rent other than the agreed period is to be clawed back” (27 July 2024). Neither of those emails describe the situation the property manager alleges, that is, that the rent reduction would essentially be a deferral of rent payment, rather than a rent abatement which would not be repaid. To the contrary, those emails only refer to repayment of any arrears accrued outside of the agreed temporary rent reduction period.
Lastly, I find there was no agreement that rent would be reduced beyond 12 September 2024. The draft agreement only refers to a reduction in rent up until that date. Accordingly, I find that from 12 September 2024, rent returned to the amount stated in the tenancy agreement, being $1450 per week. Going forward
During the hearing, the parties agreed the fixed term tenancy shall come to an end on 28 February 2025.
Unless alternative agreement is reached between the parties, and recorded in writing, the rent due each week from 12 September 2024 to 28 February 2025 is $1450 per week.

Should the tenant reimburse the application fee?

The landlords claimed rent arrears of $3,750. Given they have only partially succeeded with the claim the tenant is not ordered to reimburse the filing fee.

Tenancy Tribunal case 4996951 — Rent arrears at 30A St Stephens Avenue, Parnell, Auckland 1052

At a glance

Tenancy Tribunal case 4996951 — Rent arrears at 30A St Stephens Avenue, Parnell, Auckland 1052

At a glance

Award balance

Claims & awards

Order

Reasons

Was there agreement to reduce the rent?

What were the terms of the agreement to reduce rent?

Should the tenant reimburse the application fee?

Topics & place

Residential Tenancies Act sections

Key findings

Property management

Frequently asked questions

Award balance

Claims & awards

Order

Reasons

Was there agreement to reduce the rent?

What were the terms of the agreement to reduce rent?

Should the tenant reimburse the application fee?

Topics & place

Residential Tenancies Act sections

Key findings

Property management

Frequently asked questions