The Tenancy Tribunal is crucial in resolving disputes between landlords and tenants under the Residential Tenancies Act. However, a significant portion of its workload involves rent arrears cases, which do not always require the
nuanced adjudication that other tenancy disputes might.

There’s a strong case for removing rent arrears cases from the Tenancy Tribunal and proposing an alternative method to handle these situations more efficiently.

The biggest issue is the current burden on the tribunal. You can find yourself waiting for months to get a hearing, and while you are waiting the arrears continue accumulating. This helps no-one. The landlord is out of pocket and the tenant could find themselves evicted with a bad credit rating.

About 75 per cent of tribunal hearings include a component of rent arrears; many will solely be about rent arrears. These cases are straightforward: the tenant either has or has not paid their rent. There is little room for dispute, so these cases can be considered more a matter of fact than a complex legal disagreement.

The current system needs to be set up to resolve cases quickly. When the tribunal handles rent arrear cases, it wastes time for the landlord and adjudicator. Typically, tenants do not attend these hearings, making the process one of merely putting a formal seal on an order.

The Solution

This time-consuming procedure takes resources away from more complex and contentious cases that require the tribunal’s attention.

There is a solution. A more efficient way would be to handle rent arrears cases remotely. After the tenant falls 21 days in arrears, the landlord could submit an application with all necessary evidence, such as rent statements, arrears notices, a copy of the tenancy agreement, and the tenant’s contact address.

Under section 55 of the Residential Tenancies Act, if the tribunal is satisfied the tenant is at least 21 days in arrears, it must make an order terminating the tenancy.

A remote adjudicator could verify the submitted information and issue orders for termination and possession without a formal hearing. Tenants would still retain the right to contest the decision within five working days if they can demonstrate a substantial wrong or miscarriage of justice, as stipulated under section 105 of the act.

This process would limit the risk to the landlord to around five weeks of rent arrears.

The benefits of removing rent arrears cases include:

• Reduction in tribunal workload: Based on current estimates, the tribunal could reduce its caseload by around 120 cases per week by removing rent arrears cases. This would allow adjudicators to focus on more complex disputes, leading to quicker resolutions and more efficient use of resources.

• Faster resolutions for complex cases: With a lighter caseload, the tribunal could prioritise serious cases involving health and safety, antisocial behaviour, assault, and willful property damage. This could significantly reduce wait times for these urgent matters.

• Consistency and transparency: Handling rent arrears cases remotely with standardised procedures would ensure consistency in decisions. This approach would also maintain transparency as tenants could contest orders within a reasonable time.

• Economic efficiency: Landlords and tenants would save time and money by avoiding unnecessary tribunal hearings. Landlords would receive quicker resolutions and tenants would avoid the stigma of appearing in tribunal records for straightforward cases.

Removing rent arrears cases from the Tenancy Tribunal and handling them through a remote adjudication process offers a practical and efficient solution to a significant portion of the tribunal’s workload. This change would lead to faster resolutions, improved consistency, and better resource allocation, ultimately benefiting landlords and tenants.

Implementing this reform requires careful planning and consideration of tenants’ rights, but the potential gains
in efficiency and justice make it worthwhile.

David Faulkner is the general manager of property management for Property Brokers and is recognised as one of the leading experts in the New Zealand property management industry. He has been involved in the industry developing robust policies and procedures, training, and consultation services for many years.