Regulations improved for landlords chasing debt

Legislative changes came into force on April 14 that will improve and streamline the judicial processes used by landlords to chase debtors.

Writing
  • 1 May, 2014
  • PROPERTY MANAGEMENT
  • Landlords

The Courts and Criminal Matters Bill amends 20 statutes to enhance courts’ powers and processes for the collection of fines and debts. The bill is considered the biggest change to civil enforcement since the District Courts Act was passed in 1947. A significant change for landlords relates to the attachment order used by landlords with problem tenants.

An attachment order requires employers or the Ministry of Social Development to deduct debt payments from the salaries or benefits of people who owe money in a judgment or court order, until their debt is paid. This is an effective means of recovering the judgment debt.

The Residential Tenancies Act 1986 and the District Courts Act 1947 have been amended to make attachment orders easier and faster to get.  Parties will be able to agree at a hearing or mediation that a debt can be enforced by attachment order, so that payments are deducted directly from the debtor’s income. An attachment order can only be used for recovery of debt where the debt and an agreed repayment plan are finalised – it cannot be used where a tenant is still being charged rent.

Source: landlords.co.nzwww.dbh.govt.nz

LJ Hooker NZ

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