Death no end to debts: Tenancy Tribunal case reminder of financial obligations

Woman found liable for rent weeks after she died. Photo / file

Death is no end to debts, a top lawyer has warned after a woman's estate was ordered to pay rent for three weeks after she died.

Joanna Pidgeon, a specialist property lawyer at Pidgeon Law and Auckland District Law Society immediate past president, was commenting on a Tenancy Tribunal ruling where money was charged to an estate after a tenant died.

And that money had to be paid.

Lene Wong died in Ngāruawāhia in September and her landlord was told of the death by police on September 15. Twin Rivers Real Estate and Courtney Trustees applied to the tribunal for $705 rent arrears through to October 6 last year.

That was 21 days after they were notified of her death.

Pidgeon said dying did not discharge a person from their financial responsibilities.

When someone dies and they have a will, that will names those responsible for identifying the assets and liabilities, Pidgeon said. Those people - executors - will be obliged to pay outstanding debts from the assets of the estate and to deal with what remains, she said.

"The executors apply for probate in the will in the High Court which when granted gives them the power to administer the estate. They are required to pay the debts of the estate if there are sufficient funds, and then to distribute the estate" she said.

Ian Todd was named as the executor of Wong's estate. He was ordered to pay the money being claimed.

The tribunal said Todd did not dispute the $640 bond being released to the landlord.

"The landlord has applied for rent arrears and has provided rent records which prove the amount owing. I note that the rent arrears was calculated until 6 October 2019 which is 21 days after the tenant was found deceased

"After considering the rent records, I am satisfied that the landlord is entitled to the amount claimed," said the ruling from the adjudicator.

Joanna Pidgeon of Pidgeon Law. Photo / supplied

Pidgeon said probate existed so that a time period had to elapse until the beneficiaries of an estate were paid out. Probate was usually six months - a time period when those who were claiming money, such as landlords, had enough time to come forward.

"If a claim for payment of a debt is made after six months the creditor risks that the estate will be distributed and there will be no money to distribute," she said.

"If the estate does not have enough money to settle all debts they will usually be paid pro rata from the funds held," she said.