21 Dec 12
It is not always easy to find the ideal rental accommodation in just the right area, at an affordable price with all the conveniences that make life comfortable. Once it has been found and secured through a tenancy agreement, and the occupants settle into the neighbourhood, ending the agreement is usually the furthest thing from their minds. However, life has a way of throwing the unexpected at people and sometimes things happen that prevent the tenancy from going through to its legal conclusion.
Tenancy Agreements are Legally Binding
What must be understood is that a tenancy agreement signed by all parties is a legally binding document. It is not something that can just be ignored or torn up because circumstances have changed. This doesn't mean, however, that the tenant is trapped in the tenancy, but it does mean that there are legal processes that must be followed to end a fixed-term tenancy before time.
There are legally specified reasons why a tenancy agreement can be terminated. If the landlord breaches the agreement, if the premises have become unusable, if the rent has increased during a fixed term tenancy of two years or more, or 'extraordinary' grounds and hardship are the only legal reasons that are accepted. There are four extraordinary grounds specified. Accepting a place in social housing, in an aged care facility, where the premises are to be sold and the tenant wasn't informed, and in cases of domestic violence, etcetera.
To end the tenancy on any of these grounds, the tenant must give the landlord a written termination notice and vacate, including returning the keys. The termination notice must state the address of the premises, the date intended to be vacated and the reason. The tenant must also apply to the Consumer, Trader and Tenancy Tribunal for a termination order. Tenants should understand that the tribunal may not make an order to vacate, and the tenancy will continue.
Always Keep the Leasing Agent Informed
Before taking any of these steps, the tenant should firstly contact the real estate rental agency and explain their circumstances. If the tenant has looked after the property, paid their rent on time and fulfilled all conditions of the tenancy agreement up until now, the agency may be sympathetic to the circumstances. When the rental market is buoyant and other good tenants are available, the agency may consent to the transfer of the tenancy to a third party, especially if the new tenant is able to move in immediately and there is no loss of income.
If the landlord does not consent, the tenant should vacate the premises on the specified day, return the keys and stop paying rent. If a break fee is specified in the tenancy agreement, the tenant must pay this amount to the landlord for breaking the agreement. If no break fee is specified, the tenant and landlord may come to some mutual agreement. If not, the landlord can apply to the tribunal for an order that the tenant pays a certain amount in compensation.
It is important that the tenants follow all due processes if they find they must break the agreement. They will need references if they are renting elsewhere, and to leave an agency and a landlord high and dry without going through the legal steps will not help them find new accommodation. Being up front and honest usually works out best in the end.