Tenants' Union of Tasmania

Lease Termination

The Tenants' Union regularly comes face-to-face with homelessness from its clients due to the inequities of sections of the Residential Tenancy Act 1997.  Under the Act any lease terminations that are instigated by the landlord require a minimum of either only 14 or 28 days notice be given before a tenant must leave the premises.  Low vacancy rates, increasing rents and high security deposits (bonds) along with short notice means that many tenants and their families find it difficult to find alternative accommodation.  When coupled with finding accommodation near schools, places of employment and convenient services, termination of a lease at short notice can be an extremely difficult life event.  In some cases homelessness results.
The Act gives no consideration to the tenant’s potential for finding suitable alternative accommodation, treating the lease as a general contract rather than one that is for the provision of a basic human right.  This can mean that tenants, through no fault of their own, can find themselves on the streets in two or four weeks without recourse to the Law.  
Sections 42 and 43 of the Residential Tenancy Act 1997 sets out when a notice to vacate can be given by the owner and the length of notice required:
(1) An owner of residential premises may serve on a tenant of the premises a notice requiring the tenant to deliver vacant possession of the premises to the owner for any of the following reasons:
(a) that the tenant has failed to comply with any provision of the residential tenancy agreement [14 days notice];
(b) that a residential tenancy agreement expired less than 28 days before the service of the notice [14 days notice];
(c) that the residential tenancy agreement is not for a fixed period and the premises are to be sold, renovated or used for another purpose [28 days notice];
(d) that a residential tenancy agreement is due to expire not more that 28 days after service of the notice [14 to 28 days notice];
(e) that an order has been made under section 86 of the Land Titles Act 1980 for foreclosure of the premises [28 days notice];
(f) that the premises are to be sold pursuant to section 78 of the Land Titles Act 1980 [28 days notice];
(g) that the tenant has caused nuisance at the premises that is substantial [14 days notice].
 
Case Study
John* has lived in a Southern Tasmanian rural rental property for the past ten years on a non-fixed lease with his partner and five children aged between 1 and 15.  He is on a Disability Pension and his partner is on a Parenting Pension.  They are very good tenants helping with repairs and maintenance over the ten years whilst the landlord has done little to the property.  
After ten years, the landlord gives them two Notices to Vacate which are invalid and a third that states the property is to be sold and that they have 28 days to leave.  They have a solid footing in the community with social networks and children in school and so they do not wish to leave the area.  
Being a rural region, alternative accommodation is difficult to find.  In addition, John and his family receive help with their bond from Colony 47 but landlords in the area discriminate against potential tenants by not accepting bond assistance.  Without Court intervention they may be homeless.

High rents also make it difficult for some tenants to keep up-to-date with their payments.  If a tenant falls behind in rent by as little as one day, three times in twelve months and is served notice on each of these occasions then they can be evicted under Section 43(2) of the Residential Tenancy Act 1997:
A notice to vacate on the ground of failure to pay rent is of no effect if a tenant pays all arrears in rent before that notice takes effect unless 2 or more notices to vacate on that ground have been served on the tenant during the immediately preceding 12 months.
Again, the eviction, which only requires two weeks notice, may lead to homelessness.
 

Some sections of the Residential Tenancy Act 1997 are the most progressive in Australia.  For example, all states and territories in Australia except Tasmania allow evictions without grounds.  However, several states have fairer conditions associated with evictions and the period of notice given.  The TUT believes the tenant’s prospects of finding alternative accommodation should be paramount and therefore the following modifications to notice periods should be adopted.
 

Recommendation:

Sect. 42(1)	Description	Present Notice	TUT Proposed Notice	TUT Justification
(a)	that the tenant has failed to comply with any provision of the residential tenancy agreement	14 days	14 days	This is a reasonable period as the tenant has an option to remedy the breach within the notice period.
(b)	that a residential tenancy agreement expired less than 28 days before the service of the notice	14 days	90 days	In the current climate, and with no prior notice, a tenant must have a reasonable opportunity to find suitable alternative accommodation.
(c)	that the residential tenancy agreement is not for a fixed period and the premises are to be sold, renovated or used for another purpose	28 days	90 days	This will allow tenants a reasonable period to find suitable alternative accommodation.
(d)	that a residential tenancy agreement is due to expire not more that 28 days after service of the notice	28 days	90 days	As above
(e)	that an order has been made under section 86 of the Land Titles Act 1980 for foreclosure of the premises	28 days	90 days	As for 42(1)(c)
(f)	that the premises are to be sold pursuant to section 78 of the Land Titles Act 1980	28 days	90 days	As for 42(1)(c)
(g)	that the tenant has caused nuisance at the premises that is substantial	14 days	14 days

 
Recommendation: In the event of a tenant falling behind in rent (rent arrears), a negotiated repayment plan must be attempted prior to eviction.
 
The paramount consideration in housing disputes should be the prevention of homelessness and social dislocation.  Where reasonable progress towards repayment of debts are being made, leases should not be terminated.