Tenant Ordered to Pay Rent Arrears and Break Lease Fees
📌 In brief
The Tenancy Tribunal ruled that a tenant must pay rent arrears and break lease fees after ending a fixed-term tenancy early without agreement or Tribunal order. The tenant argued financial hardship, but the Tribunal found that the landlord had taken reasonable steps to mitigate losses and that the break lease fees were fair and reasonable.
⚖️ Legal holding
A tenant remains liable for rent and break lease fees when ending a fixed-term tenancy early without agreement or Tribunal order.
📖 Technical summary
The Tribunal ordered the tenant to pay rent arrears, break lease fees, and other costs to the landlord.
📜 Headnote Official document
The Tenancy Tribunal ordered the tenant to pay rent arrears, break lease fees, and other costs to the landlord after the tenant ended a fixed-term tenancy early without agreement or Tribunal order. The Tribunal found that the tenant remained liable for rent until the end of the fixed term and that the break lease fees were reasonable.
📚 Full judgment Official document
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[2026] NZTT 5452591, 5451892
TENANCY TRIBUNAL AT AUCKLAND | TE TARAIPIUNARA RETIHANGA KI TĀMAKI MAKAURAU
APPLICANT: [redacted]
Landlord
RESPONDENT: [redacted]
Tenant
TENANCY ADDRESS: [ADDRESS], [POSTCODE]
ORDER
1. The [COMPANY_4] is to pay the bond of $2,200.00 () to [COMPANY_1] as Agent for [NAME_1] immediately.
2. [NAME_2], [NAME_3] is to pay the sum of $4749.90 to [COMPANY_1] as Agent for [NAME_1] immediately, for rent arrear to 23 February 2026, water bills, filing fees and break lease fees, as calculated and set out below:
Description Landlord Rent arrears to 23/02/26 $5,650.00 Water rates $311.65 Filing fee reimbursement $28.00 Break lease fee $960.25 Total award $6,949.90 Minus Bond $2,200.00 Total payable by Tenant to Landlord $4,749.90
Reasons:
1. Both parties attended the hearing.
2. This is a landlord claim and a tenancy counter claim.
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3. This was a fixed term tenancy that had commenced on 28 February 2023. There had been several fixed terms agreements entered into over the course of this tenancy. The last 12-month fixed term tenancy commenced on 25 February 20025 and was to end on 23 February 2026.
4. Due to financial changes and work commitments the tenants sought to end the fixed term early. The landlord and tenant entered into discussions on an early release. Both parties agree that a break lease fee and rent payment until the end of the fixed term or a new tenancy was applicable.
5. The landlord advertised the property and reduced the rental to attract a new tenant. However, the new tenant did not take over the property until after the end of the fixed term tenancy, on 6 March 2026.
6. The landlord seeks the break lease fees, rent until the end of the fixed term tenancy, refund of the bond, filing fee, and water bills.
7. The tenants claim that they would suffer financial hardship if they were forced to pay the full cost of the break lease fee and the rent until the end of the fixed term. They seek the Tribunal to consider their situation and make a fair and reasonable resolution.
Ending a fixed term tenancy early:
8. Under section 66(1) of the Residential Tenancies Act 1986, a fixed-term tenancy is binding on both parties for the agreed term unless:
- Both parties agree to end it early, or
- The Tribunal orders termination on specific grounds (such as hardship under section 66(1)(b)).
9. Section 40(1)(a) requires the tenant to pay rent as it becomes due under the tenancy agreement.
10. If a tenant leaves early without agreement or a Tribunal order, they remain liable for rent until the end of the fixed term or until a new tenant takes over (whichever is earlier). The landlord must take reasonable steps to mitigate their loss by seeking a replacement tenant.
11. A break lease fee may only be charged if it is a reasonable estimate of the actual costs incurred by the landlord in re-letting the property (such as advertising and agent fees).
12. In this case, the tenant ended the tenancy early without agreement or a Tribunal order. The landlord did not secure a new tenant until after the fixed term ended. Therefore, the tenant remains liable for rent up to the end of the fixed term.
13. Financial hardship alone does not remove the tenant’s obligation to pay rent unless the Tribunal has made an order under section 66(1)(b) to terminate the tenancy on hardship grounds.
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14. The landlord may also recover reasonable break lease costs, provided they are supported by evidence.
15. The rent arrears claimed cover the period of 18 December 2025 to 23 February 2026, which is 9 weeks and 5 days. The total amount of rent arrears owed is $5650.00.
16. The landlord has provided a rent summary which shows the rent arrears owed under the tenancy agreement.
17. I am satisfied that the landlord has proven their claim for the rent arrears.
Break lease fees:
18. Under section 44A of the Residential Tenancies Act 1986, when a landlord consents to the early termination of a fixed-term tenancy, the landlord is entitled to recover from the outgoing tenant any expenses reasonably incurred in respect of the termination. The landlord must provide the tenant with an itemised account of these expenses.
19. In this case, the landlord has provided a detailed invoice outlining the work carried out and the advertising costs incurred in securing a new tenant. I am satisfied that these costs are fair and reasonable for the work undertaken.
20. Accordingly, the tenant is liable to pay the landlord the break lease costs as invoiced. The landlord has complied with their obligations by providing an itemised account, and the costs claimed are reasonable and directly related to the early termination of the tenancy.
The tenants’ claims:
21. The tenant seeks the Tribunal to consider their financial hardship and whether the landlord did all they could to find a tenant earlier.
22. The tenant say they had provided people to the landlord that were potentially tenants to take over the tenancy. However, as the Landlord stated in the hearing, just because a person expresses interest in a property does not mean that they are suitable as new tenants. There are checks and procedures that must be attended to before a new tenancy is offered.
23. The tenants have not provided any information that would suggest the landlord has not been fully committed and responsible in finding a new tenant to take over the tenancy.
24. The break lease fees I have found fair and reasonable and financial hardship cannot be considered as set out in paragraph 13 of this order.
25. I am dismissing the tenants’ claims. As so I cannot grant suppression of their name and details.
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Filing Fee/ Bond:
26. Because [COMPANY_1] as Agent for [NAME_1] has wholly succeeded with the claim I must reimburse the filing fee.
27. The [COMPANY_4] is to refund the bond to the landlord immediately to offset the debt owed by the tenants to the landlord.
J Northwood
12 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 tenant ended the tenancy early without agreement or a Tribunal order, making them liable for rent up to the end of the fixed term.
- The landlord did not secure a new tenant until after the fixed term ended, justifying the tenant's liability for rent until the end of the fixed term.
- Financial hardship alone does not remove the tenant’s obligation to pay rent unless the Tribunal has made an order under section 66(1)(b) to terminate the tenancy on hardship grounds.
- The landlord provided a detailed invoice outlining the work carried out and the advertising costs incurred in securing a new tenant, which were found to be fair and reasonable.
- The landlord has proven their claim for the rent arrears and the break lease fees, which were supported by evidence and deemed reasonable.
❌ Tends to be rejected
- The tenants claimed they would suffer financial hardship if forced to pay the full cost of the break lease fee and the rent until the end of the fixed term.
- The tenants suggested that the landlord did not do all they could to find a tenant earlier, but did not provide any information to support this claim.
Patterns observed in similar cases in this collection — every case is unique.
❓ Frequently asked questions
What did this decision decide?
The tenant was ordered to pay rent arrears, break lease fees, and other costs to the landlord.
What was the dispute about?
The dispute was about the tenant ending a fixed-term tenancy early without agreement or Tribunal order and the landlord's claim for rent arrears and break lease fees.
How did the court decide, and why?
The court decided that the tenant remained liable for rent until the end of the fixed term and that the break lease fees were reasonable and directly related to the early termination of the tenancy.
Which laws or rules were applied?
The Residential Tenancies Act 1986, sections 40, 44A, and 66 were applied.
What was the argument that mattered most?
The argument that mattered most was that the landlord had taken reasonable steps to mitigate losses and that the break lease fees were fair and reasonable.
Was the decision for or against the person who brought the case?
The decision was against the tenant.
What does this mean for someone in a similar situation?
Someone in a similar situation should be prepared to pay rent arrears and reasonable break lease fees if they end a fixed-term tenancy early without agreement or Tribunal order.
What evidence or documents mattered?
The evidence that mattered included the rent summary, detailed invoice for break lease costs, and the landlord's efforts to secure a new tenant.