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Landlord’s Best Friend

Landlord’s Best Friend

Mediation can provide both landlords and tenants with workable solutions. Sarina Gibbon, general manager of Auckland Property Investors Association, offers some tips.

By: Joanna Mathers

29 December 2023

If you shudder at the mere mention of tenancy mediation, you likely think it a chore, a kangaroo court even, with the odds firmly stacked against landlords.

Well, I can’t disagree more. Of all the tribunal’s resolution pathways, mediation is the one that lets you have a say in what an agreeable and enduring resolution looks like. The alternative is to leave everything in the hands of a tribunal adjudicator. And I don’t need to tell you how much of a gamble that can be. 

Don’t overplay the self-determination aspect of mediation in your head. You are not going to have your way just by showing up. That said, there are some techniques that will help you participate effectively in a tenancy mediation and influence the outcome. Here are some simple ones that come to mind. 

Don’t Cry Over Spoiled Milk, But do throw It Out. 

Try as media sensationalists might, renting is far less Dickensian than they would have you believe. There are hardly any absolute victims or villains. For the most part, landlords and tenants are much the same. Everyone is doing their best to understand and navigate some very complex tenancy laws. Most people don’t arrive at a mediation with clean gloves. 

For genuine and inadvertent mistakes, such as not providing a rent summary on request, I suggest you fix them up as best as you can, as soon as you can. It’s less about doing the right thing (you should) and more about being strategic with your approach. Starting a mediation with as clean a slate as possible saves you precious time on knucklehead stuff. Why bother when the ending is merely a foregone conclusion? You are better off spending most of the time on contentious issues where you stand to gain significant ground. 

Mediation gives you a say in what an enduring resolution looks like.

Make Your Counterclaim. 

Mediation is one of those rare moments in life when it is appropriate, prudent even, to air out your dirty laundry. 

If you have legitimate grievances against the tenant and find yourself at the receiving end of a tribunal application, file your counterclaim before the scheduled mediation so that all the outstanding issues can be addressed in a single forum. There’s no point starting on the back foot if you don’t have to. By laying everything out at mediation, you and your tenant can flesh out the best way to resolve the dispute and move on.

If your (counter)claim involves rent arrears, be sure to front up to the day with an updated rent summary so everyone knows precisely how much the tenant owes. 

Know The Mediator’s Role

Cynics will have you believe that tenancy mediators are ideologues powered by a fervid desire to stick it to landlords. That couldn’t be further from the truth. Most landlords I’ve worked with have come away from the process with the view that mediators are problem-solvers with a singular focus on expediting fair and mutually agreeable outcomes. We often think of tenancy mediators in the context of mediation, but their role is more pivotal and far-reaching than that. They are also intermediaries in subsequent negotiations between you and your tenant if the mediation yields no agreement. 

Treat the moderator as an ally, not an adversary. Defer to their expertise; when it comes to tenancy, they know a great deal about the law and where the tribunal leans. Be a respectful participant and do everything you can to help them help you. 

Want Vs Need

Treat mediation not as a forum to reaffirm your positions but rather as an opportunity to further your interests. What good is winning the battle if that means losing the war? 

Have two very specific outcomes in mind: the best possible (what you want) and the one you can live with (what you need). Anything in between is a win. 

These parameters will keep you razor-focused on the big picture so you don’t get carried away by the heat of the moment. That steadiness of mind will go a long way to help you negotiate effectively with the tenant. 

Mediators are problem solvers and can help expedite fair outcomes for both tenants and landlords.

Watch Your Mouth 

Chances are, relations are already less than amicable. I don’t blame you. It is hard to stay friends when legal proceedings are involved. Conscious uncoupling isn’t for everyone, and snark can be oh-so-tempting. Find your inner Michelle Obama; go high when the tenant goes low. 

Lower your voice, don’t interrupt the tenant and wipe that scoff off your face. Most importantly, sanitise your language. The tenant isn’t lying; you just remember things differently (bonus points if you can provide documents that support your narrative). “She is not crazy. Oh, no. She just became highly distressed after the floods. You did your best to do what was right by her, but you couldn’t do anything about insurance delays and labour shortages. It is a shame that a mediator has to get involved.”

Park the emotions at the door and get your sardonic kick elsewhere. You are not just there to negotiate with the tenant. You are also signalling to the mediator that yours is a worthy corner to be on. And when it comes crunch time, you want the mediator to go the extra mile to get that deal you want across the line. 

Get The Order Sealed

The agreement you make in mediation will be recorded as a mediated order, which is not legally binding unless it is sealed. 

Effectively, an unsealed order is a gentleman’s handshake; there isn’t much you can do if the tenant reneges on any of the terms. Why run a marathon only to drop out after 41kms? Always ask the mediator to arrange for the order to be sealed. 

I often chuckle at the thought that, as investors, we take great joy out of negotiating for properties, but as landlords, we shy away from tenancy mediation when the two are much the same. When you see mediation for what it truly is: an opportunity to get your rental business back on track, you will come to appreciate how essential a skill it is to have in your landlord toolkit.