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Landlord/Agent breaking lease agreement

By 8 January 2014 24

One week before moving into a rental property, the landlord/agent decided to back out of the rental lease agreement which was signed back in mid-December. The agreement was counter-signed and witnessed by one of the agent’s assistants.

Since I wasn’t going to move in  until mid-Jan, agent had agreed to let me pay bond and 2 weeks rent after I returned from the holidays. After having done so, I was told that the owner had basically taken away the property and will not be pursuing with the agreement. I was also told they are well within their rights to do so because bond and 2 weeks rent weren’t paid in full at the time of signing.

Now, I want to know if they can just screw me like this. I’ve always thought that once the agreement has been signed – it cannot be cancelled unless both parties have mutually agreed to do so.

Any thoughts on what to do next would be highly appreciated.

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24 Responses to Landlord/Agent breaking lease agreement
#1
thatsnotme7:45 pm, 08 Jan 14

Sounds very shady to me – I think they’re trying to back out of the deal, and hoping that they can baffle you with legalise.

The standard Tenancy Agreement for the ACT states that:

By signing this tenancy agreement, the lessor and the tenant agree to be bound by its terms
during the period of the tenancy it creates.

There is no provision anywhere in the agreement regarding when the bond should be paid, and in fact bond is not necessary if the lessor decides not to collect it.

There is a section in the agreement where the rent to be paid is documented, and also when that rent must be paid by. What date is shown on your agreement?

If you want to pursue it more, get in touch with the Tenants’ Union – http://www.tenantsact.org.au/contactUs/Tenants-Advice-Service has their contact details.

I’m no lawyer, or expert on the subject, but my quick reading of the agreement doesn’t highlight any clause that makes the agreement dependant on payment of rent in advance, or bond.

#2
arescarti429:56 pm, 08 Jan 14

thatsnotme said :

Sounds very shady to me – I think they’re trying to back out of the deal, and hoping that they can baffle you with legalise.

The standard Tenancy Agreement for the ACT states that:

By signing this tenancy agreement, the lessor and the tenant agree to be bound by its terms
during the period of the tenancy it creates.

There is no provision anywhere in the agreement regarding when the bond should be paid, and in fact bond is not necessary if the lessor decides not to collect it.

There is a section in the agreement where the rent to be paid is documented, and also when that rent must be paid by. What date is shown on your agreement?

If you want to pursue it more, get in touch with the Tenants’ Union – http://www.tenantsact.org.au/contactUs/Tenants-Advice-Service has their contact details.

I’m no lawyer, or expert on the subject, but my quick reading of the agreement doesn’t highlight any clause that makes the agreement dependant on payment of rent in advance, or bond.

Agreed, the fact that you didn’t pay bond and two weeks rent up front shouldn’t make any difference, unless it was a requirement of the agreement (and by not doing so, you violated the terms of the agreement).

If you intend to do anything about it, speak to the Tenants’ Union. You may find that simply calling the owner/agent’s bluff is enough to get them to honor the contract. Otherwise, unless it was a particularly good deal or unique property, you may find that taking further action is more costly in time and effort than simply renting another property in Canberra’s presently oversupplied rental market.

#3
troll-sniffer10:08 pm, 08 Jan 14

They have no right to terminate. Tell them to stick with it or face the consequences. If they try and pull the old them or relatives moving in tell them you’ll be monitoring the truth of that claim as well. The legislation is as clear as day on this, there are no grey areas or paragraphs full of waffle.

#4
LegalNut10:22 pm, 08 Jan 14

The question that arises is whether the contract has come into being. Did the contract specify that the bond and rent could be paid at a later date or was that a separate agreement with the agent. If the latter, one could argue that no consideration has passed (ie nothing has been paid for the contract) and thus it is not enforceable.

I’d give Tenants ACT a call to see if you have a leg to stand on and then consider if RTT action is appropriate.

#5
Queen_of_the_Bun11:22 pm, 08 Jan 14

What date was the lease meant to start? Although it is unusual not to have to pay some sort of deposit.

However, if you’re really stuck, I have a spare room.

#6
gooterz11:28 pm, 08 Jan 14

It said the money was paid hence contract is legit.

#7
Mordd1:25 am, 09 Jan 14

I’ve learnt the hard way never take an Agents word for anything – you will only get screwed over in the future. Insist on any variation, no matter how minor, to any aspect of your lease or conditions, in writing no matter what.

#8
LegalNut8:01 am, 09 Jan 14

gooterz said :

It said the money was paid hence contract is legit.

Yep. For my analysis to have been relevant they would have to have try and cancel the agreeement prior to the payments.

OP appears to have a contract that the lessor can’t walk away from.

#9
vet1118:46 am, 09 Jan 14

Rental agreements are a bit of a different beast to a normal contractual arrangement. My take on your situation would be as follows:
The rental agreement was entered into at the time both parties signed.
If bond and rent was not paid in accordance with the agreement, you have breached the terms of the agreement.
However, it is unlikely your breach of the agreement gives the landlord/agent the right to terminate the agreement.

My expertise is in NSW tenancy law, not ACT. However, I can tell you that if this occurred in NSW, the landlord would have to seek an Order from the tribunal to terminate the agreement. Landlords only have limited circumstances in which they can terminate the agreement, and it’s unlikely a single breach that has since been rectified would give them sufficient grounds to terminate.

It’s well worth having a look at the ACT tenancy legislation. Then, if I were you, I’d send them a letter/email asking them to advise you which provision of the legislation they are terminating the agreement under. They will either then have to make something up, or try and make an argument that the agreement was never entered into. It’s highly unlikely they’d succeed at either argument.

Looking at the situation in practical terms, I would exercise caution in how you go about this. Assuming you are in the right, you then move into a rental property where the landlord has it in for you, and the agent is mad at you for making a fool of them. It could make your life difficult. Alternatively, there appears to be a number of rental places on the market now, and it might be worth seeing if you can find something else in the next couple of weeks.

Good luck.

#10
zorro299:50 am, 09 Jan 14

How strange….it’s likely they found someone to pay more rent or the owners no longer want to rent the place out. Either way, just as you would be penalised for lost revenue if you had backed out of a signed lease (the bond thing makes no difference if the contract had been signed), they should be penalised. Consult the Tenant’s Union to see what the caps on penalties are, but I’d guess at a minimum they’d need to reimburse you for any additional expenses you incurred with short-term accom and moving costs (if you had to move somewhere short-term till you secured another lease). Usually 30 days is termed reasonable to secure another place.

Hope you get it sorted. But, as someone else mentioned, it’s no good moving into a place when they have it in for you from jump street.

#11
RentingInCanberra11:11 am, 09 Jan 14

Hi guys, thanks for all your feedbacks.

For your record, this agreement was signed on the 7th of December. It was a standard 12 month lease with no extra terms and conditions.

After I paid the bond and 2 weeks rent in full on the 7th of January, the agent came back and said the owner had taken away the keys so they couldn’t rent the property out to us anymore. I was originally going to move in on the 15th.

She also said the owner has taken away the property from her and given it to another agent. Since the owner has terminated their agreement with this agent, does that give them the rights to take the property back and cancel my signed tenancy agreement?

#12
vet11111:48 am, 09 Jan 14

RentingInCanberra said :

Hi guys, thanks for all your feedbacks.

For your record, this agreement was signed on the 7th of December. It was a standard 12 month lease with no extra terms and conditions.

After I paid the bond and 2 weeks rent in full on the 7th of January, the agent came back and said the owner had taken away the keys so they couldn’t rent the property out to us anymore. I was originally going to move in on the 15th.

She also said the owner has taken away the property from her and given it to another agent. Since the owner has terminated their agreement with this agent, does that give them the rights to take the property back and cancel my signed tenancy agreement?

Wow, that just makes this a whole lot more complex.

I assume that your rental agreement is with the real estate agent. As such, any action you may take can only be against that agent. You can’t take action against the owner, so it’s unlikely you’ll be able to enforce the action of the agreement, i.e. rent out that property.

However, the agent can take action against the owner for any losses they may incur through meeting their obligations to you. This is likely to include (as stated by others on the forum) reimbursement for short term rental accommodation, furniture storage etc.

My recommendation would be to get yourself sorted out first – try and find another place to live ASAP. You can seek reimbursement for costs incurred later.

Once you’ve got a new place lined up, contact the ACT Tenant’s Union. Please bear in mind that these guys are very busy, so it may take you a while to get through to them. They’ve probably seen similar matters before, and can provide you with some advice.

#13
Pitchka12:00 pm, 09 Jan 14

RentingInCanberra said :

Hi guys, thanks for all your feedbacks.

For your record, this agreement was signed on the 7th of December. It was a standard 12 month lease with no extra terms and conditions.

After I paid the bond and 2 weeks rent in full on the 7th of January, the agent came back and said the owner had taken away the keys so they couldn’t rent the property out to us anymore. I was originally going to move in on the 15th.

She also said the owner has taken away the property from her and given it to another agent. Since the owner has terminated their agreement with this agent, does that give them the rights to take the property back and cancel my signed tenancy agreement?

Instead of asking question that other members are most likely unable to answer with any real certainty, take the advice of a few and for god sakes, speak to the Tenants’ Union and get the answers you are looking for, then let us know what eventuates.

#14
arescarti4212:25 pm, 09 Jan 14

RentingInCanberra said :

Hi guys, thanks for all your feedbacks.

For your record, this agreement was signed on the 7th of December. It was a standard 12 month lease with no extra terms and conditions.

After I paid the bond and 2 weeks rent in full on the 7th of January, the agent came back and said the owner had taken away the keys so they couldn’t rent the property out to us anymore. I was originally going to move in on the 15th.

She also said the owner has taken away the property from her and given it to another agent. Since the owner has terminated their agreement with this agent, does that give them the rights to take the property back and cancel my signed tenancy agreement?

Check the names on your lease agreement (they should have given you a copy). The standard agreement is usually between the tenant and the owner, not the tenant and the agent.

If that’s the case then no, what agent they chose doesn’t affect the agreement they made with you.

#15
RentingInCanberra1:43 pm, 20 Mar 14

Strange it is, the same agent has just listed the property for rent today! Not sure what’s going on…

http://www.allhomes.com.au/ah/act/rent-residential/204-155-northbourne-avenue-turner-canberra/1316895390011

#16
troll-sniffer3:54 pm, 20 Mar 14

Plenty of places around a the moment, rents are going down rather than up, you should be able to secure a better deal than the one you signed, so maybe just walk away and hope the owner get a shite tenant…

#17
RentingInCanberra6:08 pm, 20 Mar 14

troll-sniffer said :

Plenty of places around a the moment, rents are going down rather than up, you should be able to secure a better deal than the one you signed, so maybe just walk away and hope the owner get a shite tenant…

Troll-sniffer, yes, i’ve already found a new place so it’s all good. But looking at ad, for some reason they think they can charge more now!?!? The rent has gone up from $480 (back when I signed) to $540-560!

#18
milkman8:27 pm, 20 Mar 14

RentingInCanberra said :

troll-sniffer said :

Plenty of places around a the moment, rents are going down rather than up, you should be able to secure a better deal than the one you signed, so maybe just walk away and hope the owner get a shite tenant…

Troll-sniffer, yes, i’ve already found a new place so it’s all good. But looking at ad, for some reason they think they can charge more now!?!? The rent has gone up from $480 (back when I signed) to $540-560!

Some landlords are just idiots. As are some tenants.. As a landlord I try to avoid the idiot tenants. As a tenant you should try to avoid the idiot landlords.

#19
RentingInCanberra11:27 pm, 20 Mar 14

well said, mate. for anybody looking for a place to rent, it’s probably best to avoid this dodgy real estate agent from Gungahlin.

#20
taninaus7:11 am, 21 Mar 14

you have to wonder about the competency of the real estate agent when they can’t post an accurate advertisement on all homes – the property only has 2 bathrooms, no bedroom or car parks indicated on the icons, commentary talks about “furnished to the highest standard” but the pictures show an unfurnished apartment.

I think you were smart to walk away and find something else.

#21
VYBerlinaV8_is_back9:12 am, 21 Mar 14

taninaus said :

you have to wonder about the competency of the real estate agent when they can’t post an accurate advertisement on all homes – the property only has 2 bathrooms, no bedroom or car parks indicated on the icons, commentary talks about “furnished to the highest standard” but the pictures show an unfurnished apartment.

I think you were smart to walk away and find something else.

I’ve been a landlord of multiple properties for over a decade now, and my experience of property managers is that when you find a good one, hang on to them, because they are rare.

#22
Sandman4:19 pm, 21 Mar 14

So it’s been empty for nearly 3 months? Or did they take an ultra short term lease at an exorbitant price from January to March?
Sounds like you dodged a bullet there. Not sure that’s the kind of landlord you want. Did you get your bond and 2 weeks rent back?

#23
VYBerlinaV8_is_back4:25 pm, 21 Mar 14

Sandman said :

So it’s been empty for nearly 3 months? Or did they take an ultra short term lease at an exorbitant price from January to March?
Sounds like you dodged a bullet there. Not sure that’s the kind of landlord you want. Did you get your bond and 2 weeks rent back?

There will be something strange going on, like the owner decided to renovate because their tradie son needed work, or something. Some people are pretty weird, and do things for strange reasons.

I doubt it was anything personal to do with the OP.

#24
qbngeek10:36 am, 22 Mar 14

You might also find that you were a victim of a landlord trying to cash in on the Defence posting cycles. It is not uncommon for rent on apartments in the city to go up around December in anticipation of single Defence members or Members moving here without their families.

It is most noticeable with furnished properties as MWD(U) members will try to secure these properties so they don’t need to move/buy/lease a second lot of furniture while they are posted here.

Mid year is a better time for finding a rental around the city.

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