How to Get Rid of Bad Tenants

23/04/2012

We’ve all heard the horror stories about bad tenants failing to pay up, damaging the property and generally making a nuisance of themselves.

If your tenant truly is a lost cause that will end up leaving you out of pocket, then naturally you’ll want to evict them as quickly as possible and bring in someone who will help to get your property investment back on track.

However, you don’t have the right to kick them out without following the correct legal framework. Fail to do so and you could find yourself fighting a lengthy and costly battle.

Step 1: Know the law

Tenants have certain rights that are enshrined by law in each state and territory, and the sad truth is that some nightmare tenants know how to play the eviction game and will use the legal framework to draw out the process for as long as possible. It’s vital, therefore, to have a property manager who is familiar with their state or territory’s tenancy laws.

Tenancy laws

 “The legislation is different from state to state,” notes Queensland based Glenda Rajah, from Guardian Property & Asset Management. “They are all along similar lines, but there are different timeframes involved.”

Each state or territory’s residential tenancy legislation will include the following details:

• The rules for notifying the tenant that they have breached the rental agreement:
• The timeframe that a tenant must be given to remedy the breach
• The rules for issuing a notice of termination of the tenancy if they fail to remedy the breach
• The grounds upon which a landlord can terminate a tenancy

Step 2: Get the agreement right

There are various terms that you can legally include in your tenancy agreement that, if breached by the tenant, will give you legal recourse to issue a breach notice. These include:

• The rental amount and how frequently it must be paid
• The tenants’ duty to inform the landlord or property manager of maintenance issues
• The tenants’ duty to pay for any damage other than fair ‘wear and tear’
• The tenants’ names, and the number of tenants that can live in the property
• The tenants’ rights and responsibilities regarding visitors and their conduct

Including such terms in the tenancy agreement at the start of the tenancy will allow you to refer back to the paperwork when issuing a breach notice.

“With all our properties, the leases come with no smoking inside the premises, so if you walk in [at a routine inspection] and can smell the smell of smoke you can breach them,” says Rajah.

Step 3: Conduct regular inspections

Each state and territory’s tenancy laws stipulate how many routine inspections you or your property manager can carry out each year. In New South Wales, for example, you can carry out a maximum of four routine inspections per year – having given the tenant seven days’ notice of the inspection date.

Here are some of the key warning signs to look out for that your tenant isn’t following the terms of the agreement.

• More beds or mattresses than the number of people on the lease
• Damage to the property
• Unreported maintenance issues
• Uncleanliness

Rajah adds that some of the common reasons to issue a breach notice include cars being parked on lawns, torn fly screens, holes in walls, tears or stains to carpets and unauthorised pets. She warns, however, that it’s important to know the law when it comes to documenting the evidence of a tenant’s bad behaviour.

“When the property managers do their routine inspections, by law they’re not allowed to take photographs of any personal possessions,” she says. “If a car’s parked on the lawn, you’re not allowed to take a photograph of that car because it’s got an identifying registration number. So everything is very tightly controlled.”

Step 4: Issue a breach notice

If your tenant has breached the terms of the tenancy agreement, then it’s important to issue a breach notice as soon as possible – as this is a vital step in the eviction process. Fail to issue a breach notice, giving the tenant the timeframe to remedy the breach that has been outlined in the state legislation, and you won’t be able to commence eviction proceedings.

The state or territory’s official breach of notice form must be issued and delivered in a manner set out by the relevant legislation. This may include giving the notice to the tenant personally, or posting it to them. In most cases your property manager will be posting the breach notice, and legally must allow enough time for the notice to be delivered before the breach period can start. 

In Western Australia, for example, a tenant who fails to pay the rent on time must first be served with an official ‘Breach notice for non-payment of rent’ form. If the tenant doesn’t pay the outstanding rent within 14 days of receiving the form, the landlord can issue a ‘notice of termination’ requiring them to vacate the premises.

A similar process must be followed in each state and territory, and Rajah stresses that following the legal timeframes is vital. 

“A form 11, ‘notice to remedy breach’ can be sent out when they’re eight days in arrears, and you must give them nine clear days to remedy that breach – which includes two days’ postage,” she explains of the process in Queensland.

Step 5: Issue a notice of termination

How to issue a notice of termination:

If you have issued a breach notice and the breach has not been remedied within the legal timeframe then the next step is to issue a notice of termination. This will inform the tenant of the reasons behind the termination, and how long they have to vacate the premises. In Queensland, for example, the tenant must be given no less than seven days to vacate in the case of un-remedied rent arrears, and 14 days in the case of any other un-remedied breach.

“On the notice to remedy breach it lists where they’re paid to and how much rent they must pay to stop the breach. So if they don’t pay that amount by the due date, on the next day we then issue a notice to leave. If they’re paid up by the cut-off date of the notice to leave, all is forgiven,” says Rajah. If not, then it’s time to take the process to the next level.

Step 6: Gaining possession

How to properly gain possession

If you have followed all of the necessary legal steps, but your tenant refuses to vacate the premises by the date specified on the notice of termination, then you can’t simply throw them out. You must go down the relevant legal channels to gain permission to take back control of your property.

In Queensland for example, a landlord can apply to the Queensland Civil and Administrative Tribunal (QCAT) for a termination order and a ‘Warrant of Possession’ – and this application must be made within 14 days of the eviction date stipulated on the notice of termination.

If you fail to apply to QCAT within this 14-day period then, as Rajah puts it, “you have to go back to square one again.”

Once issued, the warrant will authorise a police officer or stated authorised person to enter the premises and make the tenant leave.

“QCAT sends a copy of the warrant to the local police station and they have about 14 days in which the police then go out and serve the warrant on the tenant,” says Rajah, adding that the police can forcibly remove tenants who still refuse to leave.

It’s also worth noting your state or territory’s regulations when it comes to dealing with any property that evicted tenants have left behind. You may well be required to organise the removal and storage of furniture.

“That is all at the tenant’s expense,” explains Rajah. “And that’s again why tenant default insurance is extremely important, because these sorts of things can run into hundreds, if not thousands, of dollars.”

Step 8: Going to court

Few tenancy disputes make it to court, but it’s worth covering your back and preparing for this eventuality all the same. Your tenant may be able to take their dispute to the highest level, for example, or – even if you have managed to evict them – you may choose to chase them up for damage or unpaid rent.

According to Western Australia’s Department of Consumer and Employment Protection, common disputes that find their way to court include:

• refusal to return bond money
• overdue rent
• damage to property
• maintenance of the premises
• problems when ending tenancy agreements

It’s important to keep records of both your conduct and your tenant’s conduct in relation to the tenancy agreement. The Department of Consumer and Employment Protection suggests using the following checklist:

• Can I establish that I had the right to let the premises, or an authority to act if I am not the owner?
• Do I have a copy of the tenancy agreement?
• Did I lodge the bond correctly?
• Have I kept proper records of the rent paid and the date of the last payment?
• Did I issue receipts for rent paid, and are they in order for quick reference by the Magistrate?
• If the rent was paid directly into a bank account, do I have the appropriate statements?
• When the rent fell behind, did I serve a notice on the tenant on the correct day?
• Did I follow correct procedures when serving a notice to end the tenancy agreement?
• Have I arranged for witnesses to appear at the hearing (if required)?
• Have I gone through my evidence thoroughly?

Rajah notes that, in her experience, most disputes that make it to court revolve around non-payment of rent. By the time that the tenant has been evicted, for example, the weeks of unpaid rent may not be covered by their bond and therefore you may wish to file a compensation claim.

She warns, however, that the lengthy process of going to civil court, tracking down the tenants and getting the bailiffs involved makes it “nigh on impossible” to actually recoup the unpaid rent from your ex-tenant.

“The bond will only cover so much, so then we go to court for what we call a compensation claim,” she says, adding that this is another example of why it’s vital to get adequate landlord insurance cover.