Death no escape from debt, case underlines

AUCKLAND: 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 pastpresident, 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 Ngaruawahia 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.

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

When someone died and they had a will, that will named those responsible for identifying the assets and liabilities, she said.

Those people — executors — would be obliged to pay outstanding debts from the assets of the estate and to deal with what remained, she said.

‘‘The executors apply for probate in the will in the High Court, which when 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 Ms Wong's estate. He was ordered to pay the money being claimed.

The tribunal said Mr 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,’’ the ruling from the adjudicator said.

‘‘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.’’

Ms 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. — The New Zealand Herald