Tenancy Terminated for Significant Rent Arrears
📌 In brief
The Tenancy Tribunal ended the tenancy of a tenant due to significant unpaid rent, despite the tenant's claims about issues with the rental property. The Tribunal ruled that the amount of unpaid rent was too large to be offset by the tenant's complaints.
⚖️ Legal holding
A tenant cannot prevent termination of their tenancy due to rent arrears if those arrears are substantial.
📖 What the law says
This section states that the Tenancy Tribunal must end a tenancy if the rent is at least 21 days overdue when the landlord applies to the Tribunal. It also allows termination if the tenant has caused or threatened significant damage to the property, or has assaulted or threatened the landlord or their family/agent.
Plain-English explanation — does not replace advice from a lawyer.
📖 Technical summary
The tenancy was terminated due to significant rent arrears, despite the tenant's set-off claims.
📜 Headnote Official document
The Tenancy Tribunal terminated the tenancy of the tenant due to significant rent arrears, rejecting the tenant's set-off claims. The Tribunal found that the extent of the arrears was such that the principle of set-off did not apply.
📚 Full judgment Official document
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[2026] NZTT 5494129
TENANCY TRIBUNAL AT REMOTE LOCATION | TE TARAIPIUNARA RETIHANGA
APPLICANT: [redacted]
Landlord
RESPONDENT: [redacted]
Tenant
TENANCY ADDRESS: [ADDRESS], [POSTCODE]
ORDER
1. The tenancy of [NAME] at [ADDRESS], [POSTCODE] is terminated, and possession is granted to [COMPANY], at 11.59pm on Thursday 18 June 2026.
2. The Bond Centre is to pay the bond of $1,740.00 (BN-00029278) to [COMPANY] immediately.
3. [NAME] must pay [COMPANY] $7,648.00 immediately, calculated as shown in the table below:
Description Landlord Tenant Rent arrears to 18 June 2026 $9,360.00 Filing fee reimbursement $28.00 Total award $9,388.00 Bond $1,740.00 Total payable by Tenant to Landlord $7,648.00
Reasons:
1. Both parties attended the hearing which was held remotely.
2. [NAME] and [NAME] attended for the landlord by video.
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3. The tenant did not access the hearing by the telephone or video link provided in the Notice of Hearing. I called the tenant at the start of the hearing on the phone number provided on the application and she answered the call. The tenant terminated the call part way through the hearing.
4. The landlord has applied for termination of the tenancy, rent arrears and refund of the bond.
5. Section 55(1)(a) Residential Tenancies Act 1986 (RTA) states that the Tribunal must terminate a tenancy if it is satisfied that at the date of the application rent was at least 21 days in arrears.
6. The landlord filed its application for termination on 21 April 2026. At that date the rent records provided by the landlord show the tenant was 4,554.30 in rent arrears. Weekly rent is $580.00. I am satisfied that rent was at least 21 days in arrears on the date the application was filed.
Do the issues raised by the tenant at the hearing as a set off result in the tenancy not terminating?
7. As explained to the parties in the hearing, the Tribunal must consider whether any issues raised by a tenant should fairly be taken into account before it makes a termination or rent arrears decision1. This is called ‘equitable set-off’.
8. An equitable set off is a closely linked claim, “a claim which so affects the [landlord’s] claim that it would be unjust to allow the [landlord] to have judgment without bringing the cross-claim to account” 2. A tenant does not have to file a claim to establish an equitable set-off because it is a defence and not a claim. If the tenant is entitled to set off, any such amount can be set-off against the rent payable for the purposes of a section 55(1)(a) calculation.
9. The tenants raised the following set-off issues at the hearing:
a) the landlord failed to provide an oven rack from the start of the tenancy;
b) a higher fence was required for the safety of the tenant’s children;
c) the window latches needed to be replaced as they often became stuck;
d) one of the landlord’s representatives vaped on the premises.
10. When such set-off issues are raised, it is for the party raising the issues to prove on the balance of probabilities that the other party has committed a breach of the RTA and/or the terms of the tenancy agreement and if so, what amount is then entitled to be set-off against the rent arrears owed.
1 See O’[NAME] v [NAME] (HC Auckland, AP110-PL01, 14 December 2001) 2 Grant v NZMC Ltd [1989] 1 NZLR 8 (CA) at 12-13.
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11. After listing the issues I commenced working through each issue to determine if the tenant had a valid set-off off against the rent payable for the purposes of a section 55 calculation. However the tenant terminated her call after starting to discuss the first issue involving the oven rack. Without the tenant present at the hearing to give more details in relation to the issues I am unable to further consider or determine these issues. The landlord denies any breach in relation to the issues.
12. There maybe some validity to the claims raised by the tenant. However the rent arrears owed are now substantial. Rent owing to the date of the hearing is $9,194.28.
13. In the event the tenant had established she is owed compensation for the above issues I am not satisfied that any award in her favour would reduce the rent arrears owed to the extent that the Tribunal would not terminate under section 55(1)(a). I am satisfied that the extent of the arrears is such that the principle of set-off does not have any application in this case.
14. Accordingly the tenancy is terminated.
15. This does not deny the tenant the opportunity to pursue an application with the Tribunal. If the tenant wishes to do so, it would be in the tenant’s best interests to file an application as soon as possible.
How much rent does the tenant owe?
16. The landlord provided rent records which prove the amount owing at the end of the tenancy.
17. Reimbursement of the filing fee: As the landlord has been successful in its claim I must award reimbursement of the filing fee.
[NAME]
16 June 2026
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Please read carefully: Visit justice.govt.nz/tribunals/tenancy/rehearings-appeals for more information on rehearings and appeals.
Rehearings You can apply for a rehearing if you believe that a substantial wrong or miscarriage of justice has happened. For example: • you did not get the letter telling you the date of the hearing, or • the adjudicator improperly admitted or rejected evidence, or • new evidence, relating to the original application, has become available.
You must give reasons and evidence to support your application for a rehearing. A rehearing will not be granted just because you disagree with the decision. You must apply within five working days of the decision using the Application for Rehearing form: justice.govt.nz/assets/Documents/Forms/TT-Application-for-rehearing.pdf
Right of Appeal Both the landlord and the tenant can file an appeal. You should file your appeal at the District Court where the original hearing took place. The cost for an appeal is $260. You must apply within 10 working days after the decision is issued using this Appeal to the District Court form: justice.govt.nz/tribunals/tenancy/rehearings-appeals
Grounds for an appeal You can appeal if you think the decision was wrong, but not because you don’t like the decision. For some cases, there’ll be no right to appeal. For example, you can’t appeal: • against an interim order • a final order, or the failure to make an order, where the amount in dispute on appeal is
less than $1000 • a final order to undertake work, or the failure to make an order, where the value of the
work in dispute on appeal is less than $1000.
Enforcement Where the Tribunal made an order about money or property this is called a civil debt. The Ministry of Justice Collections Team can assist with enforcing civil debt. You can contact the collections team on [PHONE] or go to justice.govt.nz/fines/civil-debt for forms and information.
Notice to a party ordered to pay money or vacate premises, etc. Failure to comply with any order may result in substantial additional costs for enforcement. It may also involve being ordered to appear in the District Court for an examination of your means or seizure of your property.
If you require further help or information regarding this matter, visit tenancy.govt.nz/disputes/enforcing- decisions or phone Tenancy Services on [PHONE].
Mēna ka hiahia koe ki ētahi atu awhina, kōrero ranei mo tēnei take, haere ki tenei ipurangi tenancy.govt.nz/disputes/enforcing-decisions, waea atu ki Ratonga Takirua ma runga [PHONE] ranei.
https://www.justice.govt.nz/tribunals/tenancy/rehearings-appeals https://www.justice.govt.nz/assets/Documents/Forms/TT-Application-for-rehearing.pdf https://www.justice.govt.nz/tribunals/tenancy/rehearings-appeals/ https://www.justice.govt.nz/fines/about-civil-debt/ https://www.tenancy.govt.nz/disputes/enforcing-decisions https://www.tenancy.govt.nz/disputes/enforcing-decisions http://www.tenancy.govt.nz/disputes/enforcing-decisions/
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A manaomia nisi faamatalaga poo se fesoasoani, e uiga i lau mataupu, asiasi ifo le matou aupega tafailagi: tenancy.govt.nz/disputes/enforcing-decisions, pe fesootai mai le Tenancy Services i le numera [PHONE].
Reasons:
⚖️ What tends to weigh in cases like this
✅ Tends to be accepted
- The landlord proved that the tenant was at least 21 days in rent arrears when the application was filed.
- The landlord provided rent records that confirmed the amount owed at the end of the tenancy.
- The landlord was successful in its claim, so it was awarded reimbursement of the filing fee.
- The rent arrears were substantial, so the principle of equitable set-off did not apply to prevent termination.
❌ Tends to be rejected
- The tenant's claims for set-off could not be fully considered because she terminated her call during the hearing.
- The tenant's potential compensation for her claims would not have reduced the rent arrears enough to prevent termination.
Patterns observed in similar cases in this collection — every case is unique.
❓ Frequently asked questions
What did this decision decide?
The Tenancy Tribunal decided to terminate the tenancy of the tenant due to significant rent arrears.
What was the dispute about?
The dispute was about whether the tenant's set-off claims could prevent the termination of the tenancy due to rent arrears.
How did the court decide, and why?
The court decided to terminate the tenancy, stating that the amount of rent arrears was too substantial to be offset by the tenant's claims.
Which laws or rules were applied?
The Residential Tenancies Act 1986, specifically section 55(1)(a), was applied.
What was the argument that mattered most?
The argument that mattered most was whether the tenant's set-off claims were sufficient to offset the significant rent arrears.
Was the decision for or against the person who brought the case?
The decision was against the tenant who brought the case.
What does this mean for someone in a similar situation?
Someone in a similar situation with significant rent arrears may face termination of their tenancy, regardless of any set-off claims.
What evidence or documents mattered?
The evidence included rent records showing significant arrears and the tenant's set-off claims, which were not substantiated in detail during the hearing.