Residential Tenancy Law
Contributor: Deborah Pippen Currency of information: March 2006Introduction
Private residential tenancies and public housing tenancies in the ACT are governed by the terms of the ACT Residential Tenancies Act 1997 (the RTA). This Act covers both private and public tenancies in the ACT and includes a standard form of residential tenancy agreement containing prescribed terms that apply to all tenancies covered by the RTA. The Act also covers non-tenant occupants of residential premises, establishing a set of occupancy principles with respect to occupancy agreements. This discussion of residential tenancies is structured in the following sections: The Application of the RTA This section surveys the provisions of the RTA applicable to both private and public tenancies. It considers the application of the RTA, canvassing those tenancies that are covered under the RTA and those that are specifically excluded from the application of the Act. Commencing a Tenancy This section outlines general questions that should be considered before entering into a tenancy in the ACT and then discusses the law and issues that arise with respect to entering a tenancy. During a Tenancy This section discusses the law and issues that arise during a tenancy. Ending a Tenancy This section discusses the law and issues that arise when ending a tenancy whether by mutual agreement, by the tenant or by the lessor (eviction). Residential Tenancies Tribunal This section considers the resolution of disputes between parties with specific attention to the operation of the ACT Residential Tenancies Tribunal (the Tribunal). Occupancy Agreements This section discusses the provisions relating to occupants (eg. boarders or lodgers) under the RTA. Public Housing This section discusses the law and issues which are specifically relevant to public tenancies with Housing ACT. Bond Loans This section discusses bond loans which are provided by Housing ACT as a form of housing assistance.Tenants and Occupants - The Difference
As discussed in the next section, there are a number of persons specifically excluded from the operation of the RTA, including boarders, lodgers, caravan park residents and residents in campus based student accommodation. Traditionally, these groups have been regulated by the common law of contract. However, changes made by the Residential Tenancies Amendment Act 2004 (ACT)introduced a set of occupancy principles for 'occupants' as defined under the Act. The coverage and content of the occupancy principles will be examined after the coverage of tenancies and before the discussion of specific issues related to public housing.Public and Private Tenancies - The Difference
As already indicated, both public and private tenancies in the ACT are governed by the terms of the RTA. Private tenancies are those residential tenancies entered into between a tenant and any property owner ("lessor"), whether a real estate agent is involved or not. A public tenancy is a tenancy entered into between a tenant and 'Housing ACT', the public housing provider in the ACT. The RTA sets out a standard form lease applicable to every tenancy entered into in the ACT, regardless of the nature of that tenancy as public or private. There is an additional form of tenancy in the ACT, which is community housing. Strictly speaking community housing is a form of private tenancy, however some community housing providers are governed by some public housing guidelines. Such tenancies are still regulated by the terms of the RTA, and the discussion to follow will equally cover tenants in community housing. While private tenancies are entirely covered by the terms of the RTA, there is a range of additional considerations relating to public tenancies arising out of the nature of public tenancy as a source of social housing provided by the ACT Government. These provisions relate to eligibility for public housing, the application of public housing waiting lists, entitlements to rental rebates and transfers between Housing ACT properties. There is also a separate dispute resolution process applying to grievances with respect to these aspects of public housing. The discussion of the RTA within this section applies equally to public and private tenancies. Those aspects of law that only apply to public tenancies will be outlined after the section has covered the provisions of the RTA.The Application of the Residential Tenancies Act 1997
The RTA applies to all residential tenancy agreements entered into in the ACT. The RTA defines a residential tenancy agreement as an agreement under which a person gives someone else (called the tenant), for value, a right to occupy stated premises for the tenant to use as a home with or without other persons. A tenancy will exist whether or not the agreement is express or implied, in writing or oral, or whether the right of occupation is exclusive to the tenant or not (s 6A). Therefore, the essential elements of a residential tenancy under the RTA are:- An agreement (in writing, oral, express or implied);
- A right of occupation (which need not be exclusive);
- That right is given for value (i.e. rent); and
- The tenant will use the premises as a home.
Exclusions from the Act and Persons Who Are Not Tenants for the Purposes of the Act
The RTA specifically excludes certain agreements and premises from the terms of the Act, as outlined below. Despite these exclusions, however, a written agreement which complies with the conditions given above (s 6A) and expressly states that it is a residential tenancy agreement will be a residential tenancy agreement (s 6B). In other words, parties to arrangements that are not covered by the Act may agree between themselves to 'opt in' and create a residential tenancy agreement. The exclusions from the RTA cover certain persons given a right to live in premises and certain premises themselves Under sections 6D and 6E the following persons given a right to occupy premises are not tenants for the purposes of the Act and do not have residential tenancy agreements:- Where the tenancy arises under the terms of a mortgage over the premises to which the tenancy relates;
- Where the tenancy relates to a scheme whereby a group of adjacent premises are owned by a company and the tenants with a right of occupation are also the joint holders of the controlling interest in the property (i.e. owner occupiers under a body corporate or other such arrangement);
- Where the agreement is entered into for the rental of premises where the right of occupancy is granted for the purposes of a holiday (i.e. rental of holiday units);
- Where the tenant is a party to a good faith agreement for the sale and purchase of the premises to which the tenancy relates (i.e. rent-buy agreement);
- Where the tenant is a boarder or lodger (see discussion below for the meaning of boarder or lodger); or
- Any other person as prescribed by the regulations.
- A caravan or mobile home situated in a mobile home park. A mobile home is defined by the Act as a dwelling (whether on wheels or not) capable of being transferred from place to place and re-erected. A mobile home park is defined as land lawfully used for the purpose of accommodating mobile homes or caravans;
- A hotel or motel;
- Premises used for the purposes of a club;
- Premises situated on the campus of an educational institution; and
- Any other premises as prescribed under the regulations.
- A retirement village. A retirement village is defined for the purposes of the Act as a complex of residential premises established mainly for occupation by people who are at least 55 years old under a scheme in which a person makes a payment (including a gift) to the entity administering the scheme in return for admission into the scheme as a resident of the complex;
- A nursing home or hostel conducted within the meaning of the Aged or Disabled Persons Homes Act 1954 (Cth); or
- Any other premises as prescribed under the regulations.
Summary of coverage
The following table summarises the extent of the coverage of the Residential Tenancies Act.| Residential Status | Coverage | RTA |
| Tenant | Residential tenancy agreement | 6A |
| Children of a tenant, not paying rent or board | Not covered | 6A(1)(c), 71C(1)(c) |
| Adult family members of a tenant, not paying rent or board | Not covered | 6A(1)(c), 71C(1)(c) |
| Living independently in a caravan, not in a Park | Residential tenancy agreement | 6A |
| Caravan park/mobile home resident | Occupancy agreement | 6F(1)(a), 71C(1) |
| Caravan/mobile home park (resident owns the van or home) | Occupancy agreement | 6F(1)(a), 71C(1), 71E(2) |
| Boarder/lodger | Occupancy agreement | 6E(b), 71C(1) |
| On-campus accommodation | Occupancy agreement | 6F(1)(d), 71C(1) |
| Employment-related housing | Residential tenancy agreement | 6C |
| Holiday property | Not covered | 6D(1)(c), 71C(1)(b) |
| Hotel or motel | Not covered | 6F(1)(b),71C(1)(b) |
| Agreement for the sale or purchase of the house | Possibly an occupancy agreement | 6E(1)(a), 71C(1) |
| Agreement arising under a mortgage | Possibly an occupancy agreement | 6D(1)(a), 71C(1) |
| Agreement under a company title arrangement | Possibly an occupancy agreement | 6D(1)(b), 71C(1) |
| Written agreement says that it is a residential tenancy agreement | Residential tenancy agreement | 6B |
| Retirement village | Application of RTA excluded | 4(a) |
| Nursing home or aged care hostel | Application of RTA excluded | 4(b) |
Commencing a Tenancy
In the ACT, any agreement which falls within the definition of a residential tenancy agreement and which is not excluded from the application of the Act is properly considered to constitute a residential tenancy agreement for the purposes of the RTA. Parties to a residential tenancy agreement cannot 'contract out' of the RTA by providing that the provisions of the Act do not apply. Any such contract term will be void (s.9 and cl.3).The Standard Residential Tenancy Terms
Schedule One of the RTA contains 'standard residential tenancy terms'. A residential tenancy agreement entered into in the ACT must contain, and is taken to contain, terms to the effect of the standard residential tenancy terms (s 8(1)(a)). Therefore, there is one standard form of tenancy agreement that applies to every residential tenancy in the ACT. In addition to the standard residential tenancy terms, a residential tenancy agreement may contain additional terms provided that those additional terms are consistent with the standard residential tenancy terms (s 8(1)(b)). The parties to an agreement may agree on the inclusion of additional terms in their agreement, provided that those additional terms are consistent with the existing standard residential tenancy terms Any term of a residential tenancy agreement that is inconsistent with the standard residential tenancy terms is automatically void under the Act unless it has been endorsed by the ACT Civil and Administrative Tribunal (the "Tribunal") (s 9). Where parties wish to enter into a residential tenancy agreement containing terms which are inconsistent with the standard residential tenancy terms, such terms will only be valid and legally binding if the parties have sought endorsement of the inconsistent terms from the Tribunal (s 10). Parties to a residential tenancy agreement may apply in writing to the Tribunal for the endorsement of an inconsistent term. The Tribunal will review the application, having regard to the rights and obligations of both parties under the agreement and whether consent to the inconsistent terms in question was obtained by fraud or undue influence. The Tribunal may either endorse or reject the inconsistent term. If there is an equivalent standard residential term, the Tribunal may substitute the inconsistent term with the equivalent standard residential term. The RTA provides that one type of inconsistent term may be included in a tenancy agreement without being endorsed by the Tribunal (s 8(2)). This is a posting clause, which, if included, must provide that the agreement can be terminated by giving a minimum of 4 weeks notice when, in the course of their employment, the lessor is posted to Canberra or the tenant is posted away from Canberra.Fixed Term and Periodic Tenancies
Where a lessor and a potential tenant have agreed to enter into a residential tenancy agreement, they may choose to begin with either a fixed term tenancy or a periodic tenancy. The tenancy may be oral or in writing. The existence of the tenancy will not be affected by whether or not the tenancy is in writing or is oral, and all tenancies contain the set of standard residential tenancy termsA. Fixed Term Tenancy
A fixed term tenancy is a residential tenancy agreement whereby both parties agree that the tenancy will continue for a fixed period. However, unlike a standard common law contract, the expiration of the fixed term agreed between the parties does not bring the tenancy automatically to an end. Rather, at the expiration of the term agreed upon by the parties, the tenancy automatically becomes a periodic tenancy (see discussion to follow) unless or until the tenancy is terminated in accordance with the RTA or a new fixed term is agreed to by both parties It is important to note that the expiration of time under a fixed term agreement does not, of itself, bring the tenancy to an end (see Ending a Tenancy).B. Periodic Tenancy
A periodic tenancy is a residential tenancy agreement, where there is no agreed fixed period for the continuation of the tenancy. Instead, the tenancy continues indefinitely until either party terminates the tenancy in accordance with the provisions of the RTA (see Ending a Tenancy ) or until a new tenancy is created whereby both parties agree to the commencement of a fixed term. While private tenancies can be entered into on the basis of either a fixed term or a periodic tenancy, all public tenancies operate as periodic tenancies.Forms of Tenancies
The basic residential tenancy agreement is a straightforward agreement between a lessor and a tenant whereby there is a single tenant who agrees to undertake all of the obligations under the tenancy agreement. However, in reality, rental agreements are not usually this straightforward. Often there will be more than one tenant residing in the property, or more than one tenants' name on the residential tenancy agreement. When there is more than one tenant or more than one name on the agreement, it is important to clarify the legal obligations of each party. The difficulties become even more magnified when we move from tenants with families who reside with them (when the legal obligations are usually fairly clear) to the sometimes complex arrangements that can exist in share housing. It is important to understand the legal obligations that may arise in any share housing arrangement and to appreciate the possibility for liability to arise for the acts of house mates, especially where more than one tenant has signed the residential tenancy agreement. The forms of tenancies that can arise in share housing involve co-tenancies, head / subtenancies or other arrangements.A. Co-tenancies
A co-tenancy arises where two or more people jointly agree to undertake the obligations arising under a residential tenancy agreement. Usually, a co-tenancy will involve a written agreement, whereby all tenants place their names 'on the lease' and agree to the obligations contained therein. However, it is important to note that a co-tenancy can be created even where there is no written residential tenancy agreement, if all tenants and the lessor agree to undertake the legal obligations arising under the agreement. The important legal consequence of co-tenancy is the fact that co-tenants are individually and severally liable for the obligations that arise under the agreement. Individual and several liability means that each tenant who is a co-tenant agrees with each other tenant that they will be jointly liable for the obligations arising under the agreement, as well as individually liable. This means that if there are obligations arising under the agreement, for example if there is rent in arrears, the lessor can choose to take action against all of the co-tenants, some of the co-tenants or only one of the co-tenants. The lessor can take action for the full amount owing under the agreement against only one co-tenant. Because that co-tenant is jointly and individually liable, they can be made responsible for the entire debt. If this occurs, that co-tenant will then have a right to pursue the other co-tenants for a contribution to the amount that the co-tenant has had to pay to the lessor because the other co-tenants are jointly liable. Joint and several liability is a very serious consequence that arises from co-tenancy. In practice it means that for the term of the tenancy, each co-tenant is potentially responsible in law for the actions of the other co-tenants in relation to the residential tenancy agreement. It also means that a co-tenant cannot just move out of a tenancy and assume that their obligations under the tenancy have ended. Instead, while they remain a party to the residential tenancy agreement, their legal obligations to the lessor and to the co-tenants remain. In order to terminate those obligations the co-tenant would need to find someone to replace them on the agreement (with the consent of the lessor and other co-tenants) or obtain agreement from the co-tenants and the lessor to release them from their obligations. The only way to ensure the end of liability is for the tenancy agreement to end and the remaining parties to sign a new agreement.Head Tenant / Subtenant
Co-tenancies arise where two or more people agree to be legally responsible to the lessor for the obligations arising under a residential tenancy agreement. However, another scenario arises where only one person agrees to be legally responsible to the lessor, and other tenants agree to be legally responsible to that person. The person who agrees to be responsible to the lessor is known as the head tenant and the other residents are known as subtenants. There are two common scenarios where this situation arises. First, a tenant enters into a lease with a lessor and agrees to undertake the entire responsibility for the lease, and obtains permission to 'sublet' rooms in the house to other tenants. This is common where an individual tenant wants to avoid the potential legal consequences of co-tenancy. The second scenario is where there has been a co-tenancy in existence, but some of the co-tenants have moved on. Rather than obtaining new co-tenants, the existing tenants may prefer to bring new residents into the premises as subtenants. A head tenant in this situation is wholly liable to the lessor under the terms of the residential tenancy agreement for the rent and for the other obligations that arise under the agreement (i.e. the obligation to notify the lessor of the need for repairs if they arise). A head tenant will then enter into separate residential tenancy agreements with subtenants whereby the head tenant agrees to provide them with a right of occupancy of residential premises in return for value. This means that the head tenant stands in the position of lessor to the subtenants and will be bound by a residential tenancy agreement with each subtenant in the same way that their own lessor is bound by their agreement. In practice this means that there is no legal relationship between subtenants and the lessor or owner of the premises. Subtenants cannot force the lessor to affect repairs or fulfil other obligations. Their legal rights only exist against the head tenant, who then has a right to pursue the lessor under the terms of their agreement. Note that, in some situations, the person may be in the property as a boarder or lodger of the head tenant. In this case, there is no legal relationship between the boarder and the lessor; it is a relationship solely between the head tenant and the boarder/lodger.Illegal Subtenancies
In order to create a subtenancy, the head tenant must seek the written consent of the lessor. Clause 72 of the standard residential tenancy terms provides that the tenant shall not assign or sublet the premises or any part of them without the written consent of the lessor, and that no rights in respect of the premises may be created in any third party prior to consent being obtained from the lessor. This is further reinforced in the body of the Act, which provides that a person who resides in the premises without consent does so as a licensee only (s 128). This means that a subtenancy will only be enforceable (eg. if the lessor attempts to have the subtenant removed), if the lessor has given consent to the creation of a subtenancy. Where a subtenancy has been created without such consent, the subtenancy is an illegal subtenancy and the subtenant has no legal protection against the lessor.Tenancy Databases
The Residential Tenancies (Databases) Amendment Act 2011 (A2011-31), with effect from 29 February 2012, inserted new Part 7 ("Residential tenacy databases) which incorporated nationally uniform model provisions for the regulation of residential tenancy databases, agreed to by the Ministerial Council of Consumer Affairs (MCCA). Part 6A of the Act was omitted. Former Part 6A Part 6A of the RTA regulated the use of tenant's personal information through the use of tenancy databases between 28 February 2006 and 28 February 2012. It provided that information was limited in the following ways (s 107B):- It must relate to the tenant only;
- It may be listed only once the tenancy agreement has ended
- It may be listed for a prescribed period only
- The listing person must have been given written notice of the listing, and an opportunity to review the information.
Obligations Upon Entering Into a Tenancy
The obligations of the lessor and the tenant upon entering into a residential tenancy agreement are set out in both the RTA and the standard residential tenancy terms. There are a number of different elements to consider when entering a tenancy that will now be discussed.Residential Tenancy Agreement (lease)
As already discussed, all residential tenancies in the ACT which fall under the definition of residential tenancy agreement in the RTA are governed by the set of standard residential tenancy terms set out in Schedule 1 of the Act. During the negotiations for an agreement, the lessor is required to give the tenant a copy of the proposed tenancy agreement containing the standard residential tenancy terms, allowing the tenant a reasonable time to consider the proposed agreement (s 12 & cl 9). If the proposed agreement contains any terms which are inconsistent with the standard residential tenancy terms, such terms are to be annotated in such a way as to draw the attention of the tenant to the fact that the term is inconsistent (s 12). In addition, the lessor is required to provide the tenant with the following information:- The full name of the lessor;
- An address for service on the lessor and at which the lessor can be contacted; and
- A copy of any relevant energy efficiency rating statement;
- A copy of an asbestos assessment report for the premises, if the lessor can obtain the report by taking reasonable steps, or otherwise an asbestos advice for the premises (s 12(3)).
Up Front Costs of Establishing a Tenancy
At the time of entering into a tenancy, cl 24 of the standard residential tenancy terms and s 15 of the RTA specifically state that the lessor may only charge a tenant rent or bond. A lessor cannot require any payment from a tenant for any of the following things:- Granting, extending, transferring or renewing a tenancy or subtenancy;
- Vacating the premises;
- Obtaining a key to the premises; or
- Obtaining information on the availability of tenancies.
Condition Reports
An important aspect of commencing a tenancy is documenting the state of the rented premises at the time that the tenant takes possession of the property. Documentation of the condition of the premises helps to resolve disputes about property damage or wear and tear at the end of the tenancy, and ensures that tenants are not held responsible for pre-existing damage to the premises It provides each party with the opportunity to set out their view of the condition of the premises A condition report may, but need not, include a list of items at the premises, other than goods leased with the premises (s 29(5)). In order to ensure that documentation of the condition of the premises takes place, the RTA and the standard residential tenancy terms require the completion of a condition report (s 29 & cl 21). The lessor is required to provide the tenant, within one day of the tenant taking possession of the premises, with two copies of a completed condition report. The tenant is required to examine the report, indicate agreement or disagreement with the items or annotate as appropriate, and return one copy of the report to the lessor within two weeks This two week timeframe gives the tenant ample opportunity to identify any issues or problems that might not have been immediately apparent to them. The condition report will be taken to constitute evidence of the state of the premises at the commencement of the tenancy, in the event of any dispute regarding the premises at the end of the tenancy. Therefore it is important that both the lessor and the tenant ensure the completion of a condition report. If the tenant does not return a copy of the condition report, then the report, as completed by the lessor will be used to establish the condition of the property at the commencement of the tenancy (s 30(2)). Where the lessor has failed to supply a condition report to the tenant, in the event of a dispute, the evidence of the tenant as to the state of repair or general condition of the premises will be considered to constitute evidence of the condition of the property at the commencement of the tenancy (s 30(3)). Accordingly, it is advisable for lessors to complete a thorough condition report and provide the tenant with two copies within the first day of the tenancy. Where a lessor does not do this, it is advisable for the tenant to complete their own condition report, and submit a copy to their lessor. A condition report should be reasonably detailed and it may also be helpful for the tenant or lessor to take photographs of the condition of the property as further evidence.Bond
A lessor may require a tenant to pay a bond as a security deposit of up to a maximum of four weeks rent. A lessor does not have to require a bond, but if they do, there are set procedures for the handling of that money. A bond is an amount of money put up by the tenant to secure their obligations under the residential tenancy agreement. The RTA allows a lessor to request a guarantee or indemnity as an alternative (or in addition to) to the bond monies However, the total cost of whatever is requested cannot exceed four weeks rent (s 20). At the end of the agreement, the bond money may be available to cover certain outstanding liabilities that the tenant has accrued over the period of the tenancy, to the end of the tenancy and not beyond it. (s 31) The bond is not designed to cover the last four (or equivalent) weeks of rent due on the property and the standard residential tenancy terms specifically state that the tenant shall not use the bond money to pay the rent for the last week's of the tenancy (cl 26). If the lessor requires a bond on the property, the bond must be lodged with the Office of Rental Bonds (ORB) (ss 23 & 24). The ORB is part of the ACT Registrar-General's Office and an impartial third party that holds all bonds in the ACT. This way, the money is not held by either the tenant, the lessor or any relevant real estate agent (i.e. none of the directly interested parties). Either the lessor, agent or tenant may lodge the bond and the requirements for lodgement are set out in cl 19 and 20 of the standard residential tenancy terms. Where the bond is paid to the lessor, they have two weeks in which to lodge the bond with the ORB after is it received from the tenant. Where the bond is lodged by a real estate agent, the agent has four weeks to lodge the bond. Where it is agreed that the tenant will lodge the bond with the ORB, the lessor may make access to the premises conditional upon the tenant producing evidence that they have lodged the bond. Where the bond has not been lodged with the ORB, the tenant may apply to the Tribunal for an order requiring that the bond be lodged. If the lessor or their agent fails to lodge the bond with ORB within 2 weeks (or another prescribed period) they can attract a penalty of up to 20 penalty units. After lodgement of the bond, the ORB issues a receipt by mail to the lessor and to the tenant. The ORB issues standard forms for the lodgement of bond monies, the transfer of entitlements under the bond and for the refund of the bond (available to download at www.ors.act.gov.au/community/rental_bonds). They also have a comprehensive Rental Bonds Practice Manual available via the website. During the tenancy, parties to the residential tenancy agreement may change, without the tenancy itself ending. Where this occurs, the parties to the tenancy may transfer the bond held with the ORB from an existing tenant who is leaving to a new tenant who is moving in. To transfer the bond monies, the parties need to complete a transfer of bond form, available from the ORB and obtain the signatures of the lessor or real estate agent and the tenants concerned. It is important that these forms are completed and lodged to avoid delays or problems at the end of the tenancy. At the end of the tenancy, the issue of the release of the bond will arise. The tenant(s) is entitled to the return of the bond monies on the property, unless there are outstanding monies owed in relation to the period of the tenancy or unless the property has not been returned in the condition that it was at the beginning of the tenancy, fair wear and tear excepted (s 31). A tenant is required to return the property to the lessor at the end of the tenancy in substantially the same condition as the property was originally rented, allowing for fair wear and tear (cl 64). 'Fair wear and tear' relates to the use of the property by the tenant, recognising that during a period of occupancy, a property that is lived in will experience a degree of wear and tear from normal every day use. When a lessor rents out a property, they must expect and accept that the property will be used and lived in. There are two elements of fair wear and tear:- Fair: This relates to how the damage has been caused. Damage that will not be the tenants' responsibility will be damage that arises in the course of the fair use of the property for residential purposes For example, the wearing of the carpet in high traffic areas of the property would usually be fair use, arising out of the normal use of that property. However motor oil stains in the lounge room carpet probably would not arise in the fair use of the property.
- Wear and Tear: This relates to the effect of the damage, considering the degree and severity of the damage. Minor damage that occurs through usual use of a property, such as scuff marks or sun fading of curtains would be considered fair wear and tear. However where the damage is more significant or severe it may not be considered to constitute fair wear and tear.
Condition of the Premises at Commencement of Tenancy
In undertaking to lease residential premises to a tenant, a lessor must provide a basic level of amenity and habitability. Clause 54 of the standard residential tenancy terms provide that the lessor shall provide the premises to the tenant (including any relevant furniture, fixtures or appliances) in a reasonable state at the commencement of the tenancy. Specifically, the premises must be:- Fit for habitation;
- Reasonably clean;
- In a reasonable state of repair; and
- Reasonably secure.
Tenants' Right of Quiet Enjoyment
In renting premises to a tenant, a lessor surrenders their right of possession of the property, subject to their legal rights of access (see During a Tenancy), for the duration of the residential tenancy agreement. This means that, unless the agreement provides to the contrary, the tenant is provided with exclusive possession of the premises from the date of the commencement of the tenancy (cl 53). The concept of exclusive possession means that a tenant has a right of exclusion of all other persons from the premises, including the right to exclude the lessor from access to the premises, unless the lessor is exercising a particular right of entry under the agreement. Of course, in a situation of subtenancy, a subtenant will generally share a house with a head tenant and will not have a right to exclude the head tenant, however, the head tenant will have a right to exclude the lessor. In addition to the provision of exclusive possession, the lessor also guarantees to the tenant a right of quiet enjoyment of the premises and guarantees that there is no legal impediment to the use of the premises by the tenant for residential purposes (cl 51 & 52). The concept of quiet enjoyment is described in the standard residential tenancy terms as the lessor shall not cause or permit any interference with the reasonable peace, comfort or privacy of the tenant in the use by the tenant of the premisesReal Estate Agents
Lessors often employ real estate agents to manage their properties. This generally means the lessor will have no direct contact with the tenant. Agents are contracted to act on behalf of the lessor and at the direction of the lessor. However the lessor is still bound by the RTA and the agent must ensure the lessor is aware of their responsibilities as well as their rights. It is important for tenants to understand that the agent acts at the direction of the lessor and in the interests of the lessor. Tenants should take this into account if they receive any advice from agents and always seek independent advice. Since there is no contractual agreement between an agent and a tenant it can be difficult for a tenant to take action if they are dissatisfied with an agent's conduct. However, under the Agents Regulations 2003, tenants are given standing as 'customers' of real estate agents and may make complaints concerning agent conduct under the agent rules of conduct. Complaints must be lodged with the Office of Fair Trading. For information see www.ors.act.gov.au/community/fair_tradingDuring a Tenancy
The standard residential terms at Schedule 1 of the RTA include provisions that cover most issues that may arise during a tenancy.Repairs and Maintenance
During the course of a tenancy, unforeseen problems may arise with the rented premises. Where repairs and maintenance issues arise, both the lessor and the tenant have obligations under the standard residential tenancy terms.Lessors' obligations
A lessor (or agent) is required to maintain the property in a reasonable state of repair throughout the tenancy (cl 55). The law makes a distinction between non-urgent and urgent repairs.Non-urgent repairs
Non-urgent repairs are those that do not have an immediate and significant impact on the tenants' ability to live in, or use the premises. The lessor is obliged to make non-urgent repairs within four weeks of being notified of the need for repairs, unless otherwise agreed (cl 57). If a tenant believes that a lessor is not responding quickly enough to a request for repairs, the tenant should write to the lessor or agent detailing the problem and referring to the obligation to do repairs under cl 55. However, a tenant is not required to notify the lessor about anything that an ordinary tenant would reasonably be expected to do (e.g. changing light globe or fuse). It is useful for the tenant to set a deadline for the lessor or agent to make an adequate response. If this is not done, the tenant can make an application to the Residential Tenancy Tribunal for an order that the repairs be done and, if relevant, compensation for the loss of amenity (s 71).Urgent Repairs
In recognition of the need for some repairs to be made within a very short timeframe, the standard residential tenancy terms include a list of examples of urgent repairs (this is not an exhaustive list) (cl 60):- A burst water service;
- A blocked or broken lavatory system;
- A serious roof leak;
- A gas leak;
- Dangerous electrical fault;
- Flooding or serious flood damage;
- Serious storm or fire damage;
- A failure of gas, electricity or water supply to the premises;
- The failure of a refrigerator supplied with the premises;
- The failure or breakdown of any service essential for hot water, cooking, heating or laundering;
- A fault or damage that causes the premises to be unsafe or insecure;
- A fault or damage likely to cause injury to person or property; or
- A serious fault in any door, staircase, lift or other common area which inhibits or unduly inconveniences the tenant in gaining access to or use of the premises
Tenants' Obligations
A tenant is required to advise the lessor of the need for repairs as soon as possible. A tenant is required to take reasonable care of the premises and keep them reasonably clean (cl 63). This is clarified to mean not intentionally or negligently damaging the premises, or permitting such damage by family or visitors or even pets. It is important that tenants are aware they are not liable if the damage is the result of an unavoidable accident. They are also not responsible for damage caused by something outside their control (e.g. during a burglary). Tenants are not responsible for fair wear and tear on a property (See 'Bond' under Entering A Tenancy). A tenant cannot do general repairs and deduct costs from the rent (unless the lessor has consented to such an arrangement, preferably in writing). This would result in rent arrears and would put the tenancy at serious risk. The tenant could then be sent a notice to remedy the arrears and then a notice to vacate could follow. In such a matter the Tribunal will often find the tenant at fault because of the arrears and may make an order terminating the tenancy. For similar reasons, tenants must not withhold rent if the lessor is slow to do repairs (see Termination of a Tenancy).Access and privacy
All tenants have a legal right to privacy and the quiet enjoyment of their home. A tenant is entitled to refuse access to the premises to people, including the lessor and real estate agent, except where their access is authorised by the residential tenancy agreement. Unless otherwise agreed in writing, the tenant has exclusive possession of the premises (cl 53). The standard residential tenancy terms impose an obligation on the lessor to guarantee that there is no legal impediment to the tenants' use of the premises (cl 51). The lessor must also guarantee that they shall not cause or permit any interference with the reasonable peace, comfort or privacy of the tenant (cl 52). Whether the actions of a lessor or agent constitute interference with reasonable peace, comfort and privacy will depend on the facts of each case, but some possible examples include:- Repeated visits by the lessor without justification;
- Interference with doors, windows, locks, water or power supply;
- Attempts to force the tenant to leave through noise, harassment or threats; or
- Entering the premises for an inspection or repairs without giving notice in accordance with the RTA.
Lessor's Right of Access
The lessor's rights to enter a tenant's rented premises are set out in the standard residential tenancy terms and are limited to certain circumstances. Access will be permitted in the following circumstances where a lessor complies with the notice requirements under the standard residential tenancy terms (see 'Notice of Access'):- To inspect the condition of the property;
- To carry out repairs;
- To show the property to prospective tenants or purchasers;
- For health and safety reasons; or
- To carry out the requirements of public authorities
Notice of Access
Notice from the lessor to enter the premises must be given to the tenant. Minimum periods of notice vary according to the reason for access:- Regular inspections - one week notice in writing (cl 79);
- Prospective tenants during three weeks preceding end of tenancy - 24 hours notice (cl 80);
- Prospective purchasers (once the lessor has notified tenant in writing of intention to sell) - 24 hours notice (cl 81); or
- Making or inspecting repairs - one week's notice, having regard to the interests of the tenant. For urgent repairs there must be 'reasonable' notice (cl 82).
- Failure to give notice of a specific time for entry;
- Insisting on entry without permission;
- Use by the agent of their own key to show prospective purchasers through the premises; and
- Insisting on 'open house' exhibitions.
Inspections
The standard residential tenancy terms permit inspections twice a year plus one in the first month of the tenancy and one in the last month of the tenancy (cl 77 & 78). If the notice of inspection specifies an inconvenient time, tenants can try to negotiate a mutually convenient time. Ultimately, however, the lessor has a right to entry provided reasonable notice has been given and the inspection is at a reasonable time. If the parties cannot agree on a time an application can be made to the Tribunal for an order specifying a time. The lessor cannot gain entry without the tenant's consent. If there is a dispute about access, the lessor must go through the Tribunal. The purpose of inspections is to view the condition of the premises and ascertain the need for repairs There is no obligation on the tenant to return the premises to perfect condition for the inspection. Rather, the tenant has every right to leave the premises in it's every day state, bearing in mind their obligations under the tenancy agreement to take reasonable care of the premises and keep them in a reasonably clean condition.Locks and Security
The standard residential tenancy terms provide that the tenant (or lessor) may change the locks with the agreement of the other party (cl 54). This agreement must not be unreasonably withheld. The party who changes the locks will bear the cost, unless otherwise agreed. In an emergency either party may change the locks at their own cost, without the agreement of the other party. Where a lock is changed, a copy of the new key must be provided to the other party as soon as possible. The lessor must not change the locks as a means of barring the tenant from the premises Doing so is an illegal eviction and is prohibited. Further, the lessor may be liable to compensate the tenant for wrongful eviction. If there is a problem and the tenant believes they need to change the locks to prevent unauthorized access, this should be done through the Tribunal.Use of the Premises
For the period of the tenancy, a tenant has exclusive use of the premises (cl 53). The only restrictions on this use are those detailed by the standard residential tenancy terms. The lessor or agent cannot control who the tenant has in the property as guests or what the tenant does in the property beyond these limits.Renovations and Alterations
The tenant may not make additions or alterations, or add fixtures or fittings without the written consent of the lessor. Consent should not be unreasonably withheld. The tenant must repair any damage to the premises on removal of any fixtures or fittings If this is not done the lessor may claim compensation for the cost of any restoration. Any fixtures belonging to the tenant and not removed by the tenant prior to vacating the premises will become the property of the lessor (cl 68). Moving furniture around to suit the tenant is not an "alteration" or "renovation", but putting up wallpaper, wall-mirrors, etc. may be regarded as forms of renovations. Putting nails in a wall may be regarded as damaging the property and is not recommended unless permitted by the lessor. Changing locks, taps, door or window fly screens, etc. are examples of alterations.Body Corporate
Where the premises are part of a body corporate the tenant must comply with the body corporate rules, as long as those rules are consistent with the standard residential tenancy terms (cl 66). The tenant must be provided with a copy of the body corporate rules The tenant does not have a direct relationship with the body corporate, if the body corporate has issues with the tenants' use of the premises it must communicate with the tenant through the lessor.Treatment of the premises
Unless otherwise agreed in writing the tenant must use the premises for residential purposes only (cl 69). The tenant must not use the premises, or permit them to be used, for an illegal purpose to the detriment of the lessor's interest in the premises. The tenant must not cause or permit nuisance, or interfere with the quiet enjoyment of the neighbours (cl 70). This does not mean that neighbours can force evictions because a tenant has a party or plays music at night. Any claims regarding disturbance or nuisance must be proven and this will generally not involve one-off incidents. Neighbourhood disputes are civil disputes and generally able to be resolved through civil law processes. There are no limitations on the tenant being away from the premises, beyond the requirement for the tenant to notify the lessor if they are leaving the premises vacant for more than three weeks (cl 71). This does not mean that the tenant has to have permission to do so, they simply have to advise the lessor of this fact. This is best done in writing but it is not required. If the tenant intends leaving the premises vacant for a period they must be conscious of the fact that they remain liable for the property and if it is vacant for an extended period there may be security or insurance implications. There is nothing restricting the tenant from having a friend stay to mind the property as long as it is clear that the tenant retains liability.Subletting
If a tenant has someone move in and this person contributes rent, the tenant is subletting part (or the whole) of the tenancy and the new resident is known as a subtenant (See Commencing a Tenancy). A tenant is able to sublet the premises provided they have written consent from the lessor; this consent can be given at any time (cl 72). If there is no consent to a sub leasing arrangement, the head tenant is breaching their tenancy agreement and it is a ground for termination by the lessor. In this situation the resident is an illegal subtenant and has no rights under the RTA against the lessor and has no recourse to the Tribunal. The lessor can terminate their tenancy agreement with the head tenant using the standard residential tenancy terms. They can evict the illegal subtenant (who would be considered a lodger of the head tenant) as a trespasser. If the lessor terminates the tenancy with the head tenant and the subtenant remains, the subtenant can become the tenant of the lessor by implication, if the lessor collects rent from the subtenant and acknowledges they are in the premises.Rent - Increases and Reductions
Rent Increases
The frequency of, and process for, rent increases is detailed in the standard residential tenancy terms. The rent may only be increased at intervals of at least 12 months, either from the beginning of the tenancy for the first increase, or after that, from the date of the last increase (cl 35). It makes no difference if a shorter fixed term (e.g. 6 months) has been entered into; the 12-month limit still applies. In a co-tenancy the restriction applies provided that at least one of the tenants remains from the time of the last increase. There can be no rent increase during a fixed term unless an additional endorsed term is included in the residential tenancy agreement allowing it, and such term cannot allow rent increases at intervals of less than 12 months (cl 35). The lessor or agent must give the tenant eight weeks notice in writing of their intention to increase the rent (cl 38). The notice must include the amount of the increase, and the date on which it is to take effect. If the lessor does not provide proper notice, the tenant is not obliged to pay the increased rent. The standard residential tenancy terms state that the amount of rent will not vary except as provided by the RTA and the tenancy agreement. If the rent increase notice is not valid it is advisable for the tenant to write to the lessor before the date of increase stating that they do not intend to pay the increased rent and giving the reason. The tenant should be sure to keep a copy of the letter as evidence in case there are legal proceedings at a later stage. If the tenant has already paid the higher rent they can make an application to the Tribunal for the difference to be repaid. If valid notice is received the tenant has several options. They can accept the increase and pay it when it falls due; they can try to negotiate a smaller increase; or they can terminate the tenancy by giving three weeks notice to the lessor (cl 41). If the tenant wishes to remain in the tenancy and believes the increase to be excessive and the lessor will not consider a lesser amount, the tenant can make an application to the Tribunal for a review of the increase.Review of Excessive Rent Increases
There are time limits for applying for a review, the application must be made no less than 14 days before the day on which the proposed increase is due to come into effect (s 65). This limit may be waived if the Tribunal is satisfied that there are special circumstances; and the changed application date will not significantly affect the lessor. Once an application has been made, no increase in the rental rate can occur unless allowed by the Tribunal (s 66). The Tribunal may disallow part or all of the increase if they find it to be excessive, initially based on a formula provided by the Act (s 67). If the increase is more than twenty percent greater than the relevant increase in the Consumer Price Index, as it relates to housing in the ACT, the lessor must satisfy the Tribunal that the increase is justified. If the increase is less than twenty percent and the tenant believes it is excessive, the onus is on the tenant to satisfy the Tribunal of this (s 68). Example: A 12-month lease and the CPI housing increase over that period was two percent. The rent was $200 per week. The lessor has given notice of the rent increasing to $210. This increase is greater than the CPI increase, two percent of $200 per week is $4 per week and twenty percent of that figure is 80 cents Since the increase is over $4.80 the onus is on the lessor to convince the Tribunal that it is not excessive. If the tenant believes that owing to their specific tenancy situation, an increase below $4.80 is excessive, they would have to convince the Tribunal of this. In deciding on whether an increase is excessive the Tribunal will consider a range of factors including:- The rent before the proposed increase;
- Whether it has been increased previously, the amount of that increase, and the period since that increase;
- Outgoings or costs of the lessor in relation to the premises;
- Services provided by the lessor to the tenant;
- The value of fixtures and goods supplied as part of the tenancy;
- The state of repair of the tenancy;
- Rental rates for comparable premises;
- The value of any work performed or improvements made by the tenant, with lessor's consent; and
- Any other matter the Tribunal considers relevant (s 68(3)).
Rent Reductions
A tenant pays rent in return for full use and enjoyment of the premises they live in. However, there are occasions where, through no fault of their own, this use and enjoyment may be diminished. A tenant's quiet enjoyment of premises is interfered with if there is substantial interference or a significant lessening of freedom in exercising the tenant's rights (s 71(1A)). If this occurs, the tenant should write to the lessor, or agent, advising them of the problem as soon as possible. The tenant should request that it be rectified within an appropriate timeframe and that they be compensated for this loss in the form of a rent reduction. A copy of the letter should be made and kept. If no satisfactory response is received from the lessor or the agent, the tenant may apply to the Tribunal for a rent reduction. The Tribunal may order a reduction if it considers the tenant's use or enjoyment of the premises has significantly diminished as a result of:- The loss of any appliance, furniture, facility or service supplied by the lessor;
- The loss of the use of part of or all of the premises; or
- Interference by the lessor, or their agent, with the tenant's quiet enjoyment of the property. This includes the right to use the property in reasonable peace, comfort and privacy (s 71).
Ending a Tenancy
Ending a tenancy in the ACT is subject to detailed regulation by the RTA (s 36). Tenancies may only be terminated in accordance with the provisions set out in the Act. There are a variety of ways a tenant or lessor can terminate a residential tenancy agreement and it is important that they are aware of the implications and possible liabilities associated with each of them.Termination by Lessor and Tenant
The following provisions, termination by mutual agreement or where the premises become uninhabitable, may be used by either the lessor or the tenant in order to terminate a residential tenancy agreement.Termination by Mutual Agreement
If the tenant and the lessor agree to end a tenancy, it is terminated by mutual agreement irrespective of the terms of the tenancy agreement or penalty provisions. It is extremely important to record an agreement for a mutual termination (together with the recognition that all liabilities have ended) in writing signed by both parties. Otherwise, disagreements may arise later about the basis for the termination, when it took effect, or whether any money is owing under the tenancy agreement. The agreement to terminate the tenancy agreement must not contravene any of the provisions of the RTA.Termination if the Premises Become Uninhabitable
Under the standard residential tenancy terms (cl 86) either party may give written notice of their intention to terminate the tenancy if the premises are destroyed or rendered unfit for habitation, or are not available due to government action. The tenant may give two days notice of termination, and the lessor must give at least one week. Rent is not payable from the date the premises become uninhabitable. If a termination notice is not given, rent is not payable for the period the property is uninhabitable and the tenancy will resume when it is able to be used again (cl 87). If there is a dispute as to whether the premises are uninhabitable the tenant should seek an order from the Tribunal declaring the premises to be uninhabitable.Termination by a Tenant
The RTA provides several grounds on which a tenant can terminate a tenancy agreement. Except where there has been a breach of the tenancy agreement by the lessor, a tenant's legal position in relation to termination of a tenancy is dependent upon whether the tenancy is in a 'fixed term' or is on a 'periodic' basis (see Commencing a Tenancy).Terminating a Periodic Tenancy
Under the standard residential tenancy terms (cl 88), a tenant may terminate a periodic tenancy agreement by giving notice in writing of their intention to vacate to the lessor or agent. The notice period must be at least three weeks. If a tenant vacates without notice during a periodic tenancy, they will be liable for three weeks' rent in lieu of notice, but not for any of the costs involved in reletting the premises.Termination For Breach of the Tenancy Agreement by the Lessor
A tenant has a right to claim compensation for any breach of the tenancy agreement by the lessor. In certain circumstances the tenant may also elect to terminate the tenancy (whether periodic or in a fixed term) if the breach is serious enough. The breach must be fundamental to the existence of the tenancy agreement. The standard residential tenancy terms provide two options for termination if the lessor has breached the tenancy agreement (cl 90): An Tribunal Order Terminating the Tenancy - The tenant may make an application to the Tribunal (s 43). If the Tribunal agrees that the breach justifies termination, it may order that the tenancy will terminate with two weeks notice. This period may be waived if the Tribunal is convinced that the tenant would suffer significant hardship unless the agreement terminated immediately. Tenant's Notice of Intention to Vacate - Instead of applying to the Tribunal, the tenant may serve the lessor with a Notice of their Intention to Vacate the premises as a result of the breach by the lessor. The standard residential tenancy terms set out the following procedures for a tenant to follow when terminating a residential tenancy agreement on the ground of the lessors breach (cl 91): a) The tenant must give the lessor written notice that the lessor has two weeks to remedy the breach if it is capable of remedy; b) If the lessor remedies the breach within that two week period, the tenancy will continue; c) If the lessor does not remedy the breach within the time specified, or if the breach is not capable of remedy, the tenant can give two week's Notice of Intention to Vacate; d) The tenancy agreement then terminates on the date specified by the tenant; e) Rent is payable to the date specified in the notice or to the date that the tenant vacates the premises, whichever is later; and f) If the lessor remedies the breach during the period of the notice of intention to vacate, the tenant may withdraw the notice or may terminate the tenancy agreement on the date specified in the notice by vacating the premises on that date. Once the lessor has received the Notice of Intention to Vacate, the lessor has two options (cl 84). S/he may either: a) Accept the notice and accept that the tenancy shall end on the date nominated in the notice; or b) Apply to the Tribunal for confirmation of the tenancy agreement and an order for compensation or both. It is possible that a notice of intention to vacate may be insufficient protection against liability if the Tribunal decides the termination was not justified by the nature of the breach or that the breach did not occur.Termination by Tenant at the End of a Fixed Term
If a tenant wishes to end the tenancy at or after the end of the fixed term, they are able to do so by giving three weeks notice in writing (i.e. if they wish to terminate the tenancy on the last day of the fixed term, they must give three weeks notice to the lessor of their intention to do so (cl 89)). However, it should be noted here that a lessor cannot terminate a tenancy at the end of a fixed term in this way - they must have a ground for termination under the residential tenancy agreement (see Eviction).Termination by Tenant During a Fixed Term
The tenant can terminate the tenancy agreement during the fixed term with or without grounds.A. With Grounds
On application by a tenant, the Tribunal may terminate a fixed term agreement on any of the following grounds:- The lessor has breached the standard residential tenancy terms and the breach justifies termination of the tenancy, or there are grounds under the standard residential tenancy terms for the termination (s 43);
- Where the tenant would suffer significant hardship if the tenancy agreement were to continue and the level of hardship is such that it is appropriate and just to terminate the agreement during its fixed term (s 44);
- Where the lessor has intentionally or recklessly caused or permitted (or is likely to cause or permit) serious damage to the premises or property of the tenant, or injury to the tenant or a member of their family (s 45); or
- Where the agreement was induced by a false or misleading statement of the lessor (s 46).
B. Termination Without Grounds - "Breaking the Lease"
Terminating a fixed term tenancy agreement without any of the grounds listed above is, in effect, 'breaking the lease'. Whether this is done by giving notice to the lessor, or by simply abandoning the premises, it can have severe financial consequences for the tenant. The agreement terminates upon the tenant giving valid notice of intention to vacate and vacating in accordance with cl 84(1). This includes returning all keys. Upon receiving notice the lessor can either accept the notice or apply to the Tribunal for confirmation of the tenancy and/or compensation. If a tenant terminates a fixed term early, the lessor is entitled to compensation for losses incurred as a result of the early termination (s 107 & cl 84). The lessor is lawfully entitled to compensation for:- The loss of the rent they would otherwise have received;and
- The reasonable costs involved in reletting the premises (e.g. advertising, reimbursement of legitimate agent's costs).
C. Reletting Fees
There is no provision for a lessor or agent to charge a 'reletting fee'. A lessor may, however, seek reimbursement of genuinely incurred reletting costs, and the tenant should demand an itemised account that shows how the costs were incurred. As noted above, compensation for these costs is limited to the equivalent of one week's rent which includes any costs incurred by the lessor or agent in advertising the premises. Advertising costs are not 'additional' to the compensation that can be claimed by the lessor or agent. The lessor or agent cannot claim costs over a total of one week's rent and all costs claimed must be genuinely incurred.D. Reducing losses from breaking a tenancy agreement
If an early temination is unavoidable, the tenant or tenants can take some concrete actions to reduce their potential losses, by:- Giving the lessor or agent as much notice as possible of the proposed date of vacation, so that efforts can be made to find new tenants;
- Cooperating with the lessor or agent in the reletting of the premises by making themselves available to show people through the property;
- Keeping the premises tidy so that it is attractive to prospective tenants; and
- Introducing prospective tenants to the lessor or agent. If a co-tenant is giving notice, finding a new co-tenant and introducing them to the lessor or agent for approval of a change of shared tenancy.
- Check whether the lessor or agent is making genuine efforts to relet the premises. Have they listed the property at their desk? Are they offering it to prospective tenants? What advertising is happening? Are they advertising it for a reasonable rent?
- Ensure that any reasonable offer to rent the premises is accepted by the lessor or agent. Have prospective tenants been discouraged or refused on unacceptable grounds, for example unlawful discrimination or requests for higher rent?
- Once tenants have vacated the premises, it is generally unwise to pay any further money to the lessor or agent, except in final settlement of all issues. Any payment without a guarantee that this is an end to the matter is not advisable, as it may result in money being spent but the premises remaining empty, at the tenants' cost. Of course this does not mean refusing to recognise liability regarding rent, it is a matter of compensating for real losses, not anticipated costs.
- Regularly check vacant premises to see if a new tenanthas moved in, or whether the premises are still on the market for letting. It is not unknown for a lessor to take the opportunity of an early termination to do renovations, effectively taking the property off the market. In such circumstances the tenant will usually be relieved of liability (due to the duty to mitigate â see above).
Termination by a Lessor
In relation to termination by a lessor, the RTA specifies that a tenancy may only be terminated by mutual consent or through an order of the Tribunal (s 36); and that the process set out in the Act and the standard residential tenancy terms must be strictly followed. In general, the process is as follows (cl 92 & 93):- The lessor must serve a valid, written notice to vacate on the tenant, giving them a period of notice in accordance with the type of tenancy and grounds for termination;
- The lessor must have, and must state in the notice, one or more of the lawful grounds for termination set out in the Act, as well as sufficient details identifying the circumstance giving rise to the grounds;
- The notice to vacate should also specify that the lessor requires the tenant to vacate on expiry of the notice period, and that the tenancy will end on the day the tenant vacates;
- If the tenant does not voluntarily move out of the premises, the lessor must apply to the Tribunal for a termination and possession order; and
- The tenant has the right to be present at the Tribunal hearing to defend an eviction.
Grounds for eviction
The general effect of the legislation is to ensure that a tenant can only be evicted in the ACT if:- They have breached the terms of their tenancy agreement; or
- The lessor has a genuine reason for needing to recover the premises.
Power to evict
While the lessor or agent can serve a notice to vacate, only the Tribunal can order an eviction. An important protection given by the RTA is the prohibition against a lessor attempting to recover possession in any other manner than that provided by the Act. If there is any attempt to do so (to effect a 'self-help' eviction), on application the Tribunal can order compensation be paid to the tenant (s 37(2)). If a tenant decides not to vacate the premises after receiving valid notice, the lessor or agent must seek a termination and possession order in the Tribunal in order to regain possession. There is no lawful short-cut available, even where the tenant is in breach of the tenancy agreement or behind in the rent. Listed below are the only permissible grounds for termination of the tenancy agreement, leading to eviction:Termination by the Lessor During a Fixed Term Tenancy
The lessor may not terminate a fixed term tenancy except for a breach of a tenancy agreement, or where the RTA provides grounds (Division 4.1). The grounds are set out below under 'Termination of any tenancy'.Termination by the Lessor During a Periodic Tenancy
A lessor may only terminate an agreement during a periodic tenancy where there is a breach of the tenancy agreement; there is a ground under the RTA (see below); the lessor uses cl 94 (which allows a 26 weeks 'no cause' termination) or there is a ground under the standard residential tenancy terms. The grounds under the standard residential tenancy terms (cl 96) are:- That the lessor genuinely intends to live in the premises or genuinely believes that an immediate relative or a person who has a close family or personal relationship, and a reasonable expectation that the lessor would provide accommodation, intends to live in the premises (4 weeks notice);
- That the lessor genuinely intends to sell the premises (8 weeks notice); or
- That the lessor genuinely intends to reconstruct, renovate or make major repairs that cannot reasonably be carried out with the tenant in residence 12 weeks notice).
A. Termination of tenancy in crisis accommodation
If the premises to which the residential tenancy agreement relates is declared crisis accommodation and the lessor needs the premises to use as crisis accommodation, a lessor may evict a tenant with four weeks notice (s 36(k)). The lessor must give the tenant information about alternative accommodation.Termination of Any Tenancy by Lessor
The RTA provides that the following grounds may, on application by a lessor, give the Tribunal the power to grant a termination:- Where there is a breach of the standard residential tenancy terms, or there are simply grounds under the standard residential tenancy terms for the termination and the lessor has given appropriate notice (ss 47, 48 & 49);
- Where the lessor would suffer significant hardship if the tenancy were not terminated and this hardship is greater than the hardship the tenant would suffer if the order was made (s 50);
- Where the tenant has intentionally or recklessly caused or allowed (or is likely to cause or allow) serious damage to the premises or property of the lessor, injury to the lessor or a member of their family, or if the lessor is a corporation, injury to a representative of the corporation or a member of a representative's family; or serious or continuous interference with the quiet enjoyment of nearby premises by an occupier of the premises (s 51);
- Where the agreement was induced by a false or misleading statement of the tenant (s 52); and
- Where the tenancy agreement was part of a contract of employment, the tenant has ceased working and the premises are required to house another employee (s 53).
Termination Without Cause
The RTA provides that a lessor is able to terminate a tenancy without providing a cause (cl 94). This may only occur where 26 weeks notice is given, and the notice does not require the tenant to vacate during a fixed term.Protection of Subtenants
The legislation not only protects tenants from unlawful eviction, but also extends protection to lawful subtenants. If the lessor has consented to a subtenancy, then the subtenant is protected from unlawful eviction like any other tenant.Termination Process - Notices for Breach
To initiate the termination process, the lessor must serve written notice specifying the grounds on which the notice is issued. This notice is called a Notice to Vacate. Where the termination is due to a breach of the tenancy agreement the standard residential tenancy terms specify the process that must be followed. This process differs according to the breach, but normally the tenant must be given a chance to remedy the breach before a Notice to Vacate can be served.A. Failure to pay rent (cl 92)
If any amount of rent goes unpaid for one week, after that the lessor may serve a notice stating that if the outstanding rent is paid within one week no further action will be taken (this is called a Notice to Remedy). If the rent is not paid within that week, a Notice to Vacate may be served, giving the tenant two weeks to move out. At this time an application for a Termination Order may be made to the Tribunal. Where two previous Notices to Remedy have been served during a tenancy, on the third occasion the lessor may serve a notice to vacate one week after the day on which the rent is due without serving the Notice to Remedy.B. Other breaches
For other breaches of the residential tenancy agreement, the lessor must give a Notice to Remedy the breach within two weeks, if it is capable of remedy. If the breach is not remedied, or is incapable of being remedied, a Notice to Vacate giving two weeks notice can be served. If the tenant does not vacate within the two weeks, the lessor will need to make an application to the Tribunal for a Termination Order in order to remove the tenant. If the tenant breaches the standard residential tenancy terms on three occasions on any grounds, on the third occasion a Notice to Vacate may be served immediately. A Notice to Remedy is not required (cl 93).C. Defective Notices
Where a defective notice is served on a tenant and the tenant vacates the property, the tenancy agreement terminates on the day the tenant vacates However the tenant may apply to the Tribunal for compensation for wrongful eviction, or for reinstatement as tenant (s 58). Where a defective notice is served and the tenant does not vacate, the lessor may apply for the defect to be waived. To do so the Tribunal must be satisfied that the defect did not put the tenant in a worse position (s 59).Retaliatory Applications
Where a tenant believes that a lessor is applying for a termination and possession order in retaliation for the tenant making a complaint or taking earlier action against them, they should notify the Tribunal. The Act provides that the Tribunal must not make a termination and possession order where the order has been sought against a tenant in retaliation for the actions of the tenant (s 57). The provisions work on a reverse onus of proof. If the tenant can demonstrate a reason why the lessor might engage in a retaliatory eviction, the Tribunal must not make the order requested by the lessor unless Tribunal is satisfied that the lessor was not motivated by the reason demonstrated by the tenant. The reasons that a tenant can raise to demonstrate that an eviction is retaliatory are:- That the tenant has applied to the Tribunal for an order against the lessor; or
- That the tenant has complained to a governmental entity about the lessor; or
- That the tenant has taken reasonable action to secure or enforce the tenant's rights. Here the Act provides two examples - that the tenant sought legal advice or mediation; or
- That the Tribunal made an order in the tenant's favour against the lessor.
Termination and Possession Orders
Where the Tribunal grants a lessor's application for termination, the order will specify the date that the residential tenancy agreement will terminate and the date by which the tenant must vacate the property. It will also specify that where a tenant fails to vacate, either the lessor may request that a warrant for eviction be issued to the tenant, or the order shall have effect as if it were a warrant for eviction.- Termination and possession orders may be either:
- Unconditional - they provide the above details, and if a tenant does not vacate as specified a warrant for eviction may be issued; or
- Conditional - they are issued subject to a condition set by the Tribunal (e.g. further non-payment of rent).
Warrants for Eviction
The Tribunal can issue a warrant that authorises the police (and only the police) to take appropriate action, with any necessary and reasonable assistance, to evict a specified person or that person and everyone else on the premises within the time detailed in the warrant (s 40(1)). It will require the police to give the person at least two days notice of the proposed eviction, unless the registrar believes on reasonable grounds that there are exceptional circumstances, or it would be inappropriate to give the notice (s 40(2)). The police may only physically remove a person from premises between 8am and 6pm Monday to Thursday (except on public holidays) or otherwise if authorised by warrant in exceptional circumstances (Residential Tenancies Regulation 1998 s 4A).Costs and Compensation
The RTA expressly provides that the parties to an Tribunal hearing will bear their own costs unless the Tribunal orders otherwise (in the case of one party causing unreasonable delay or obstruction). Tenants can afford to defend an eviction without fear of having to pay the lessor's legal fees if unsuccessful. If a person to whom a Termination and Possession Order is directed fails to vacate the specified premises in accordance with the order, the RTA does provide for the lessor to make an application for compensation for their real losses (s 56). The lessor may apply for:- An amount equal to the rent that would have been payable to the lessor during the period the tenant was in possession of the premises after the termination of the residential tenancy agreement; and
- An amount equal to the reasonable costs incurred by the lessor in applying for a warrant and having the warrant executed.
Substitution of a Tenant - Domestic Violence
In cases of domestic violence where a court has made an order to remove a tenant or co-tenant (the removed person) from the premises, or the individual has given an undertaking to a court to leave the premises; the remaining person can apply to the Tribunal to become the tenant or co-tenant instead of the removed person. In these cases there must be an opportunity for the lessor to be heard on the application, and the application must include evidence of the undertaking or a copy of the court order (s 107A). It is important to note that the requirement is for an exclusion order, not an interim order.Occupancy Agreements
In 2004, a new form of agreement was inserted into the Residential Tenancies Act 1997 by the Residential Tenancies Amendment Act 2004. The new agreements are called 'occupancy agreements' and are designed to provide some protection for residents within the ACT who are not tenants under the Act. The exact scope and coverage of the occupancy agreement provisions has yet to be fully explored under the Act and if you are unsure of whether or not you are a tenant under a residential tenancy agreement, an occupant under an occupancy agreement or something else altogether, you should seek further legal advice.What is an occupancy agreement?
An occupancy agreement is an agreement whereby a 'grantor' (lessor) gives an 'occupant' (resident) a right of occupation of premises under an occupancy agreement. An oral or written agreement will be an occupancy agreement under s 71C if:- An occupant is given a right to occupy stated premises;
- The premises are for use by the occupant as a home (whether or not with other people);
- The right of occupation is given for value;
- The grantor may lawfully terminate the agreement, without cause, by giving less than six months notice; and
- The agreement is not a residential tenancy agreement.
Content of Occupancy Agreements
There is no specific regulation of the process for entering into occupancy agreements or of the content of occupancy agreements. Generally speaking, occupants remain subject to the common law of contract. However, in addition to the general law, the Act sets out a set of 'occupancy principles' that persons are directed to have regard to in considering a matter or making a decision under the Act. Where a person is an occupant under an occupancy agreement, the Act provides access to the Tribunal for the resolution of disputes in relation to their agreement. Where a matter is referred to the Tribunal, the Tribunal must have regard to the occupancy principles in order to resolve the dispute. The occupancy principles are a guide for dispute resolution and do not constitute contractual terms. However, s 71G provides that an occupancy agreement may contain any terms that are consistent with the occupancy principles. The Act provides that Parliament may pass regulations setting out a set of standard occupancy principles to be applicable to all occupants. However no regulations have yet been promulgated. When standard occupancy principles are promulgated, all occupancy agreements in the ACT will be taken to contain the terms that will be set out.The Occupancy Principles
The Occupancy Principles contained within the Act in s 71E set out a series of basic obligations that are relevant for the purposes of dispute resolution under the Act. The Principles provide that an occupant:- Is entitled to live in reasonably clean, repaired and secure premises;
- Is entitled to know the rules of the premises before moving in;
- Is entitled to a written agreement where the occupancy is longer than six weeks;
- Is entitled to quiet enjoyment;
- Is entitled to eight weeks notice of an increase in the amount paid for residency;
- Is entitled to know why an occupancy agreement may be terminated and how much notice they will be given of termination; and
- Must not be evicted without reasonable notice.
Residents in Mobile Home Parks
The occupancy principles relating to access are qualified with respect to residents in mobile home parks who own their own mobile homes. Where a grantor requires access to premises occupied by a mobile home under the occupancy principles this access is limited to the land and fixtures of the grantor. If the grantor requires access to the mobile home itself, the grantor may only enter the mobile home with reasonable notice, at reasonable times, on reasonable grounds and for reasonable purposes.Resolution of Disputes Concerning Occupancy Agreements
The Tribunal has jurisdiction to determine disputes relating to occupancy agreements In the resolution of disputes the Tribunal is directed to have regard to the occupancy principles (s 71J). A party to an occupancy agreement may apply to the Tribunal for the resolution of an occupancy dispute. The process for application to the Tribunal mirrors the process set out above with respect to residential tenancy agreements. In determining a dispute the Tribunal will have regard to the terms of the occupancy agreement and to the occupancy principles. Where the Tribunal resolves a dispute with respect to an occupancy agreement it may make one of a number of orders. The Tribunal may make an order against the grantor or the occupant (or both):- Restraining an action in breach of an occupancy agreement;
- Requiring performance of an occupancy agreement;
- Requiring the payment of money to a person or the Territory (government);
- Requiring the payment of compensation for loss of rent or compensation for other loss on account of breach of the occupancy agreement;
- An order restoring the occupancy agreement or occupant possession of the premises;
- Terminating an occupancy agreement and granting vacant possession to the grantor;
- Declaring that the property has been abandoned;
- Correcting a defect in a notice; or
- Any other such order as the tribunal considers appropriate.
ACT Civil and Administrative Tribunal
The ACT Civil and Administrative Tribunal (the Tribunal) is an independent body which has exclusive jurisdiction to hear and determine any matters arising under the RTA or the standard residential tenancy terms or the standard occupancy terms. The ACAT commenced on 2 February 2009, taking over the jurisdiction of the former Residential Tenancies Tribunal. Hearings are held in a Tribunal Hearing Room at the ACT Magistrates Court.Applications to the Tribunal
Who can apply?
A tenant, an occupant or a lessor can make an application to the Tribunal.Making an application
Making an application for a hearing of a tenancy dispute is a straightforward matter. An application form can be obtained from the Tribunal, the Tenants' Union or associated websites (see Contacts). It is important to include copies of correspondence and other documents (e.g. notices, repair bills) with the application whenever possible. The applicant should keep copies of these as well in case any attached document goes missing.Filing Fees
All applications are subject to a filing fee, set by Attorney General (Fees) Amendment Determinations made under the Court Procedures Act 2004. The size of the fee depends on the nature of the dispute:- Where the amount in dispute is $1,000 or more - $123.00
- Where the amount in dispute is less than $1,000 - $61.00
- Application for termination and possession order - $123.00
- Application for a termination and possession order where no bond has been lodged with the Territory - $237.00
- For an application for any other tenancy dispute - $61.00
- Application for a subpoena to give evidence - $18.50
- Application for a subpoena for production and to give evidence - $36.00
- Application for a subpoena for production - $36.00
Jurisdiction and Powers of the Tribunal
Jurisdiction
Ancillary jurisdiction
Orders Within the Powers of the Tribunal
Tribunal Hearings
A Tribunal hearing is where the parties to a tenancy dispute each tell the Tribunal their side of the story. A Tribunal Member hears the matter and makes a decision based on the information they are provided with. Parties are generally expected to present their own case. In general there are some points that are useful to consider regarding any hearing:- Parties should have their cases well prepared and be clear about what they want to say.
- All relevant documents (e.g. rent receipts, the tenancy agreement) must be brought along to the hearing as the Tribunal may wish to see these documents.
- Hearings are informal and strict rules of evidence are not applied. Hearsay evidence may be sufficient if the Tribunal thinks it is truthful.
- Order that the dispute be set down for hearing again;
- Order that such other steps be taken before the hearing proceeds as the Tribunal directs;
- Adjourn the hearing;
- If the party is the applicant, dismiss the application; or
- Proceed with the hearing ex parte - without any representation from that party.
Legal Representation
There is an unrestricted right to be represented by a legal practitioner or agent at Tribunal hearings (s 30, ACAT Act). The Tribunal will take into account whether parties are represented or not. If a party is unrepresented, reasonable steps will be taken to ensure that they understand the process. If unrepresented it is advisable to at least seek advice before appearing at the Tribunal. It is also useful to attend a hearing at the Tribunal in order to become aware of the environment. Advice for tenants can be obtained from the Tenants' Advice Service or the Welfare Rights and Legal Centre. Advice for lessors may be obtained from the Legal Aid ACT telephone advice service.Appeals to the ACAT
Under Division 8.1 of the ACAT Act, a party to the original application may appeal the decision of the Tribunal to the Tribunal. The appeal is heard by an appeal tribunal allocated by the appeal president which will consist of 1 or more presidential members and possibly 1 or more other members of the Tribunal. A member who decided the original application cannot be on the appeal tribunal (s 81). The appeal hearing can be a full rehearing or a review of all or part of the original decision, at the discretion of the appeal tribunal (s 82).Appeals to the Supreme Court
A party to a Tribunal hearing may appeal to the Supreme Court on a question of fact or law from a decision of an appeal tribunal (s 86, ACAT Act). Leave is required from the Court before an appeal can be lodged. Legal advice should be sought before initiating an appeal.Housing Act Tenancies
Public Housing is social housing provided to those on low incomes or experiencing significant disadvantage who experience difficulties accessing private rental accommodation. In the ACT, Public Housing is administered in accordance with Housing Assistance Programs made under the Housing Assistance Act 2007 (ACT). The object of the programs is to provide rental accommodation to eligible persons in the ACT who are unable to obtain adequate and appropriate housing. The Housing Assistance Programs may be accessed at www.legislation.act.gov.au or www.dhcs.act.gov.au. The agency responsible for public housing in the ACT is Housing ACT. Housing ACT operates under the terms of the Housing Assistance Programs and is administered by the Commissioner for Social Housing (the Commissioner) who is appointed under the Housing Assistance Act 2007 (ACT). In practice the staff of Housing ACT or a delegate of the Commissioner make the majority of decisions under the Programs. Public tenancies in the ACT are covered by the same terms and conditions as those applying to private tenancies under the RTA. As discussed above, all public housing tenants enter into a residential tenancy agreement with Housing ACT, under the standard residential tenancy terms of the RTA. The main difference is that all public housing tenants hold periodic tenancies, and some terms of those tenancies, while governed by the terms of the RTA, are also subject to the terms of the Housing Assistance Programs. Chapter 56 - Public Rental Housing in the ACT examines those matters that are unique to public housing. This includes the issues of eligibility for public housing, matters specific to public housing residential tenancy agreements, transfer and 'exchange' of public housing properties, debt issues and the mechanisms that exist to deal with disputes arising under the Housing Assistance Programs between Housing ACT and applicants for public housing or between Housing ACT and public housing tenants.Bond Loans
Given the length of public housing waiting lists, Housing ACT also provides a bond loan scheme for tenants who are eligible for public housing to use to obtain rental on the private market. To be eligible for a bond loan, applicants have to demonstrate that they:- Meet the existing criteria for eligibility for public housing in the ACT.
- Do not have an interest in any property or have any available means of providing the bond.
- Do not have cash or convertible assets over $7,500 (excluding ordinary household and personal effects; and a car).
- Do not have any outstanding debts to Housing ACT (although this is subject to a discretion held by the Commissioner to waive this requirement).
- Can meet the obligations and payments necessary to sustain a tenancy in a private rental property. In practice, Housing ACT will look at the percentage of income that the applicant will be required to pay in rent and bond loan repayments. Where the percentage of assessable income required to pay rent and bond loan repayments is less than 40 percent an applicant will generally be eligible (if other criterion are met) for a bond loan. Where the percentage is greater than 40 percent, Housing ACT will generally consider the proposed tenancy to be unsustainable and will not grant a bond loan. However, this is a guideline only and the Commissioner has discretion to consider each individual application on its merits.
Contacts, Links and Resources
ACT Administrative Appeals Tribunal -- see ACT Civil and Administrative Tribunal ACT Civil and Administrative Tribunal www.acat.act.gov.au ACT Human Rights Commission www.hrc.act.gov.au ACT Ombudsman www.ombudsman.act.gov.au ACT Shelter www.actshelter.net.au ACT Tenants' Union www.tenantsact.org.au Association of Public Housing Tenants (02) 6262 6472 Australian Human Rights Commission www.hreoc.gov.au Canberra Connect www.canberraconnect.act.gov.au Department of Families, Housing, Community Services and Indigenous Affairs www.fahcsia.gov.au Early Morning Centre www.canberracityuca.org.au/html/early_morning_centre.html Havelock Housing Association www.havelock.asn.au Housing ACT www.dhcs.act.gov.au/hcs/social_housing Office of Rental Bonds www.ors.act.gov.au/community/rental_bonds Real Estate Institute of the ACT www.reiact.com.au Street Law www.streetlaw.org.au Welfare Rights and Legal Centre www.welfarerightsact.orgSitemap
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