Legal documents have legal consequences and should be vetted by legal professionals.

They signed the lease knowing the consequences.

It is reasonable to ask her to repair the damage from the painting or if not completed by XX day, then you correct the damage and send her a bill.You need to have some firm rules and enforce them with consequences. 

When a tenant doesn't instinctively do the right thing, then they may need to be taught, with clear guidelines and meaningful consequences.

Get a judgment, and then even if you just turn the judgment over to a collection service, at least you will have given them a consequence.  

The reason for rules is because millions of landlords have proven, having screened 10s of millions of applicants that those ridiculous rules serve a very valuable purpose and those landlords that choose to ignore proven valuable tools included in the ridiculous rules will suffer the consequences. 

Those are the same regulations we are forced to work with in our jurisdiction and I choose to ignore them to protect my business and my tenants.You will learn from experience that :  enforcement of the regulations will be rare if not non existent, reports by applicants few and far between, proving their case nearly impossible and landlords will quickly learn to operate their business as they always have.Stupid landlords will tell their applicants why they were rejected and suffer the consequences while the smart one will operate with impunity by simply not being so stupid as to tell them they have discriminated.Ignoring the regulations is necessary to protect your business and your other quality tenants.

This is a business and we have a contract, she broke it and there are consequences.

Secondly, I recommend you man up and accept the consequences of your actions.

Setting aside that it is premature at this point, ultimately if it came down to it, it may make sense to pay the debt to avoid any adverse credit consequences and then at that point sue to get it back.