Failure to claim bond

Question from Echo updated on 30th August 2017:

I had a management agreement with a property manager which set out clearly that they were to attend Tenancy Tribunal hearings on my behalf and to manage any claims against bond money. At the termination of the last tenancy, the property manager clearly stated to me that all cleaning expenses incurred and damages to the property were the tenant’s responsibility and they would seek remedy from the tenant through the bond refund. 

However, he failed to attend the Tenancy Tribunal hearing and failed to apply for a rehearing. The bond was fully released back to the tenant which was meant to cover all those expenses incurred. The Property Manager now holds me liable for the amount paid for cleaning and repairs by claiming that he acted on my behalf.

My question is whether I shall be liable for those expenses after the property manager failed to claim the bond on my behalf.

Our expert Bernard Parker responded:

Any person making an application to the Tenancy Tribunal is expected to attend and present their case. If your property manager simply fails to turn up, he can expect to have the application dismissed. If there was a good reason for his non-attendance and he makes an application for a re-hearing, the Tribunal may (if the explanation is accepted) re-schedule the hearing. If not, the original decision stands.

Your property manager is correct – when a property manager incurs authorised expenses while acting under an owner’s authority those expenses are a cost to the owner. I suggest you have a conversation with the property manager about his non-attendance at the hearing and the lost opportunity to recover cleaning costs from the tenant. If you cannot resolve your disagreement you can apply to the Disputes Tribunal for a ruling.

Bernard is principal of Quinovic – Kapiti-Mana. Quinovic's outstanding people and systems provide the most professional, effective and reliable residential property management service in the NZ market for over 30 years.

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