Breach notices

29 Mar 2021

In this episode of the Talking Tenancies podcast, we discuss breach notices with Sam Galer from the RTA.

Rental law changes around ending tenancies, renting with pets and the introduction of repair orders commenced on 1 October 2022.

Transcript

Host - Belinda Heit – Communication and Education – RTA 

Guest – Sam Galer – Customer Experience - RTA 

Host: Welcome to the Talking Tenancies podcast, brought to you by the Residential Tenancies Authority.  I’m your host, Belinda Heit. Join me as we explore everything you need to know about renting in Queensland, with experts from the RTA and industry. We're here to help make renting work for everyone. 

A breach of the tenancy agreement is when the property manager/owner or tenant fails to comply with any part of the agreement. Today's expert from the RTA is Sam Galer, Senior Team Leader of Customer Experience. Welcome Sam. 

Guest: Thank you. 

Host: Now, can you tell us about your role at the RTA and what you're responsible for? 

Guest: So, as you've mentioned, I'm Senior Team Leader, Customer Experience. I look after a team of staff in the Contact Centre who take enquiries about bond matters, tenancy matters and web services. 

Host: And you're back with us by popular demand. Those who listen to the podcast would be no stranger to you and how skilled you are in tenancy laws here in Queensland. 

Guest: I would like to see evidence of that, but I'll take your word for it. 

Host: Now today we're going to talk about breach notices and what they mean, and I know just the words “breach notice” sounds a little bit alarming, doesn't it? 

Guest: Can do and I'll talk a little bit to that because that's a really important point about breach notices. 

Host: So, I guess when we look at it, I mean what is a breach notice and when should we use it? 

Guest: So, a breach notice is really, it's just a document that helps formalise communications between yourself and the other party in a tenancy about a tenancy issue. You mentioned about how breach notices can potentially be perceived. It's a really important point, so we would generally look at issuing a breach notice, ideally not being the first step in addressing tenancy issues. So we would recommend whatever the issue is, that you raise it with the other party and have a conversation to talk it through and agree on the next steps before formalising the discussion that you've had with a breach notice. So, we're not necessarily saying don't issue a breach notice. It may be very appropriate to issue a breach notice, but we would absolutely recommend that someone receiving a breach notice, having no idea that there was an issue previously can, as you said, be a little bit alarming.

So, talking it through with the other party first is really important. Otherwise, it can put a significant dampener on an otherwise workable relationship with the other party. Certainly, in my time I've seen instances where people have used breach notices as a way of laying blame. So, I received a breach notice, I'm going to breach you back and have a bit of a breach war, I generally wouldn't recommend that. It's often not an effective way to address tenancy issues while preserving the relationship. 

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https://www.rta.qld.gov.au/webinars/know-and-understand-your-agreement

 

 

Host: So, I guess some examples of why you might receive a breach notice, could be if you're a tenant, it could include not paying the rent, not keeping the property in good condition or keeping a pet without permission, that’s a fairly popular one as well. 

Guest: Yeah, absolutely. 

Host: So, what about when there is a breach by the property manager or owner? 

Guest: OK, and again a breach can be by any party to the tenancy, so it certainly can happen from the property manager or owner. The process can be the same no matter who has breached the agreement. So, whoever identifies a problem or an issue first, should raise it with the other party, have a discussion together around resolving the issue before the breach notice is actually given, remembering that although the legislation does outline timeframes for rectifying breaches, it's often better to first discuss next steps with the other party and to mutually agree on a realistic and achievable timeframe so everyone is on the same page.  

I'll give a little bit of a scenario on that one, just to make sure that we're balancing that. So, its important to have the conversation. You might have a tenant who is a long-term tenant, always been super reliable with their rent and all of a sudden the rent is not being received. It's past the due date, they're now in breach of the agreement. You wait the required time, but if you then go straight to a breach notice, it may be that the tenant had no idea that they were actually behind in the rent, so not great for the relationship, you know. 

Balancing that out though, if you are an owner or property manager, rent is a situation that can quickly escalate, so really important to follow your processes more or less by the book, but that doesn't mean that you can't have a conversation. You may still issue the breach notice to have it as a record to make sure that you can take necessary action, if required. But have a conversation. 

Host: Yeah, and I think that's a little bit of a misconception, isn't it? That people think it's, you know, it's almost like a fine, I’m being given a fine. No, it's purely a formal piece of communication to set things right, correct? 

Guest: Yep, correct, it's a record of what has happened. It's a record that you have done the right thing under the legislation. You've taken the action that's available to you, but if it's happening in and of itself without any prior communication, it may not go down well. 

Host: So, I guess when we look at, you know, a managing party and how they could potentially breach. It could include things like not maintaining the property from their perspective or not repairing something that was broken or not providing the services that are listed in the agreement. So, what's some examples there? 

Guest: I guess, looking at a breach, so there are varying levels of breaches, if we talk about the property not being maintained or something not being repaired that's broken, we're talking about within a reasonable period of time.  

If I put forward a scenario that it's summer, it's 36 degrees, feels like 42, for someone from Melbourne anyway. You've got a heavily pregnant tenant, for instance. It's a small apartment, the windows don't let a lot of air in, the air conditioning has broken. She's potentially got another couple of small children running around the house as well. I'm making myself hot and flustered just thinking about it. 

Host: Me too! 

Guest: That scenario of air conditioning can have a significant impact to the tenant. The property, everything needs to be maintained in good repair, but that then becomes a very much more pressing issue, for instance than a dripping tap in the garage out the back, that yeah, it's a minor annoyance when you walk past it, but it's not keeping you up at night or really stressing you out as a tenant. They can both technically be breaches, but the impact is very different. 

Host: Yeah, and you know the scenario you've provided, there is a significant impact to the tenants quiet enjoyment, isn't it really? 

Guest: Absolutely it is, yeah. As per the Act, but I guess what we're trying to say here is that you know, being in breach isn't necessarily a bad thing. As we've talked about being in communication, so we're looking at sometimes in a property, things break, you can't expect that everything is going to be absolutely perfect all the way through potentially a long-term tenancy. Sometimes things need a bit of TLC, they need maintaining or a replacement provided, could be just down to old age, frequent use. Again, you should have spoken to the other party about this before issuing the breach notice to formalise the discussion. If you receive a breach notice, again, it doesn't necessarily mean it's like a black mark that you are a bad landlord or a bad tenant, it is simply a way to document and record the discussions that you've already had with the other party. We're going to really reinforce that, but you need to have those discussions and conversations to make sure you get the good relationship. 

But also, a way to keep the other party accountable while you work together to rectify the breach. So, breach notices can also serve to notify the other party of the breach of the agreement. So, if you had, for instance, a property owner that may have entered the property without giving a correct notice, or you may find that the tenant receives a breach notice for a noise issue. In those situations, the breach notice is formally reminding the other party of their obligations as a tenant or as a managing party. 

Host: So, what happens then, if there's repeated breaches that occur from either party in the agreement? 

Guest: So, if the same breach repeatedly occurs, the other party has an option to apply to Queensland Civil and Administrative Tribunal, so that's QCAT, to have the tenancy ended by them. So, a party can apply to QCAT to request that the agreement be terminated if, and there are some requirements here that I'll go through, but if they've issued a notice to remedy breach on two occasions for the same breach and each time that breach was rectified. So, they issued the breach notice within the time frame required the issue was fixed. But then a third breach for the same reason occurs within the 12-month period and the problem is of a serious nature they can apply to QCAT. Applying to QCAT, it’s important to note, does not automatically mean that the agreement will be terminated, but applying to QCAT is the only way to end an agreement correctly for repeated breaches. 

Host: Right. So, in the case of a repeated or a significant breach, what kind of scenarios have you seen? 

Guest: So, using rent as an example, you have a tenant who is late paying their rent. So, the day that the rent is due comes around, they don't pay their rent, OK you then have to wait for them for seven days. While the rent is not paid, if it remains not paid for those seven days, you're issuing a breach notice. Again, having had a conversation hopefully. But you issue that breach notice, they go okay, sorry I didn't realise, they pay the rent. OK, it's resolved, it's done. They've remedied the breach. Two weeks later, it happens again, going through the same scenario. Oh yeah, got the breach notice. Sorry, didn't realise, had an issue with my bank, you know, work’s dried up or whatever it is. There are obviously circumstances that can apply, but you issue the breach notice, you've had the conversation. The breach kicks in, so there's a time frame, it's got to be remedied within seven days. It gets fixed, so the tenant makes it up again and everything's fine, tenancy continues.  

If it happens a third time, within that 12-month period, you don't have to issue another breach notice, you don't issue a notice to leave. It's not always three strikes and you're out. There's a bit of a misconception that that is what happens, well, you've done it three times now I'm giving you a notice to leave. The correct process is that you apply straight to a tribunal and you ask the tribunal to end the agreement on the grounds of repeated breaches.  

So, it's looking at the impact, rent for instance, that that could have. You know the owners got a mortgage to pay, for instance. They're finding they’re behind on their payments because of this. Those are the sorts of things that QCAT potentially can look at in deciding whether they're going to end the agreement. 

Host: And that would be a fairly common outcome in that kind of scenario. 

Guest: Yeah, it can be. It's probably not often that it gets to QCAT for that. You may find that it ends earlier because the breach notice is given, and if the rent is not paid, so it's not remedied, you may proceed to a notice to leave. So, this scenario with repeated breaches is only when you're issuing a breach notice and they are remedying the issue within that time frame, but it keeps happening. 

Host: Yeah, and it doesn't necessarily have to go all the way to QCAT either, does it? 

Guest: No, not at any point, the parties may agree to come to terms to end the agreement, and they may discuss terms of compensation, potentially. As with any of those sorts of circumstances, strongly recommend that you get whatever is agreed to in writing. 

Host: Yeah, and we'll talk about breaking lease in another episode. So, what are some of the outcomes that can come from an unremedied breach? So, let's say you know you, you have got a breach and it's just not remedied. 

Guest: Sure, so we touched on a little bit there, but if you've spoken to the other party about the issue, you've issued a breach notice providing the time frame for them to fix the issue, but it still remains unresolved.  

There are two options, so you can apply for our tenancy dispute resolution service online through the RTA web services or you can submit a dispute resolution request form.  

Just a little bit about our dispute resolution service. So, it's a free and confidential conciliation service that the RTA offers to assist parties in a tenancy to reach agreement. Conciliators, they don't make decisions, so they don't make determinations, they don't look at the evidence provided to them and go this is what needs to happen, this is the decision or the determination. That's not their role. They also don't advocate for either person. Their role is to facilitate discussion and communication, a sharing of information between the parties and helping them to then reach an agreement between the parties. If the matter remains unresolved after conciliation, there's then an option to apply to the Queensland Civil and Administrative Tribunal for them to make an order to rectify the problem or to seek compensation, potentially. 

Another option that you have would be to issue a notice to leave, or if you're a tenant issuing a notice of intention to leave, giving appropriate notice period to end the tenancy. An important note on that, if you're a tenant and you're choosing to end the tenancy early, there is potential for you to pay compensation for breaking the lease, as you've mentioned if we're talking about ending a tenancy early, that'll be another episode.  

Parties can apply directly to QCAT, skipping the conciliation process at the RTA for what are considered urgent applications, these include termination of tenancy orders when the tenant doesn't leave, so a notice to leave or a notice of intention to leave has been issued and expired, or for excessive hardship. 

Host: Right, yeah. And you know, through web services the dispute resolution request that you can now do online, really streamlines that process a lot more, so that's available online as well. 

Guest: Absolutely, yep. 

Host: So, what is a significant breach? This is when things get really serious, right? 

Guest: OK, so a significant breach often relates to whether an agent or a managing party can re-enter a property, so that's often where a significant breach comes in. But listed in the in the legislation, significant breach includes where the tenant uses the property for an illegal purpose, exceeding the number of occupants allowed to live at the property, keeping a pet at the property without the property owner or managers permission or any other matter caused by the tenant that would cost more than the equivalent of one week rent to fix. 
Host: And so, what happens then when there is a significant breach? What's the process, and you know how was re-entry to the property allowed? 

Guest: Sure, so the scenario is where an agent attends a property for a routine inspection and they find that there is a dog, for instance, at the property. They had no idea, no one had talked to them about the tenants wanting to have a dog, they have not been given permission to have a dog. The agent then has that conversation with the tenant, but issues a breach notice to them for keeping a pet at the property without permission. There is the ability for them to then re-inspect the property, so to come back to the property after a certain period of time, so after the breach has been expired to see whether the tenants still have that dog. So that is where the significant breach comes in. 

We do see some confusion and we're probably going a little bit towards entry here as another topic, but there are instances where an agent comes to the property, sees that they feel that the property is not being looked after by the tenant. Sometimes too, a little bit potentially too particular, there are dishes in the sink and the agent feels that the tenant is in breach of their agreement because the dishes are there. Hopefully they don't come to my house and look at that sort of level. 

It's technically not actually a breach, but we do find sometimes that an agent will issue a breach notice for something similar to that. And then feel that they're going to come back to the property within a couple of weeks' time to check that the dishes have been rectified. So very important to make sure that you are familiar with what is and isn't a breach and the time frames and the next actions that you can take under the legislation. 

Host: And again, that same thread that runs through every episode, it's all about communication, isn't it? 

Guest: Certainly is, whenever I come into these, that's what I'm going to promote absolutely because it is the best way, we see so many issues resolved once communication is introduced and so many issues get blown out of hopefully where they could have been by people avoiding talking to each other. 

Host: Crazy isn't. Well thanks again Sam, for helping us to get a greater understanding on breach notices and what they mean. So, in summary, like we said, communication is important in every aspect of renting a property and if you'd like more information on how the RTA can help visit rta.qld.gov.au

Thank you for listening to the Talking Tendencies podcast. For more information about the Residential Tenancies authority, visit rta.qld.gov.au

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