Help - My tenants changed thir mind and sent us a demand letter!

K

kirte

Hi All,
It's my first case of "one foot tenant" and I appreciate every bit of the advise. We have a townhouse that was on the rental market. A gentlemen (maybe not :)) inspected it, loved it, and applied for the property last Monday. My PM contacted me on the same day, we walked through the tenant profile, approved him and he signed a 12 month lease next day. On Saturday, we signed all copies and returned them to the agency. On the same day the tenant called the agency and asked to visit the property to make some measurements. He went there with his wife and on return, sent out an email advising that he is not going to rent the property after all. The agency informed him about the break lease procedure and costs. Today his solicitor has sent a letter demanding the return of the bond ASAP, quoting that there "been no lease agreement established" (I've got a signed copy in front of me :)) and threatening us that "clients reserve their rights to take all actions deemed appropriate to ensure the rightful return of monies owed to them together with any legal fees incurred in the process"
The PM said that it's a VCAT matter now, but I'm a bit concerned about how heavy the legal fees could be. Can tenant apply for compensation of their legal expenses as well? Can I be liable for paying them? Do I need a solicitor to represent me, or my PM should be able to do it?

As I mentioned, any advise is appreciated.

Thanks
 
VCAT shouldn't involve heavy legal fees (certainly not at this stage of events!!).

Your PM will likely charge an "appearance fee" unless you decide to go in person (check your PM agreement).

The Y-man
 
Clients love to leave out the important bits when talking to their solicitors - the fact that he actually signed a contract may have slipped his mind.
 
With some contracts there is a statutory cooling-off period - I would check if that is the case with a lease. If not, the solicitor's letter is just to scare you. (We received a solicitor's letter over the matter of a new fence with our neighbour, threatening us with legal action. Very nerve-racking. After we did our own research we wrote back to the solicitor and as of now the neighbour has backed off).

If you need a legal opinion, some insurance policies (NRMA is one) entitle you to a free legal consultation. That might make you feel more confident.
 
kirte said:
Today his solicitor has sent a letter demanding the return of the bond ASAP, quoting that there "been no lease agreement established"
Click to expand...

The very nature of the bond provided by the tennant suggests consideration has been provided, and if there is no cooling off, the soli is blowing hot air.

Im not a solicitor btw !

ta

rolf
 
Thanks a lot for the information. I'll check with PM about cooling off and with my insurance company about free legal advice.
 
Just to be a pain, instruct the pm to lodge the bond today if they haven't already. The tenant will then need to wait until it is registered & then sign a claims form.
 
I love it when our tenants say "you will be hearing from my lawyer".
We just say, we are looking forward to it.

Unless you have a cooling off period, and it doesn't seem so, don't worry about it.
You have a contract, and now they think they can wriggle out of it, if they get their scary lawyer to write you a letter.

Call their bluff.
Good luck ...not that you need it.
 
I can understand about the break lease part, however on the other side is it worth the 12 mths of life with this tenant once in place.

I can see many stress moments if they are pushed to stay.

Read in detail the lease about cooling off and break lease costs.

Brian
 
I have just confirmed there is NO cooling off period on residential leases in NSW.
I suspect the same for Victoria. This link from NSW Fair Trading is very informative about this issue.
http://www.fairtrading.nsw.gov.au/T...nding_a_tenancy/Breaking_a_lease_early.htmlIs
All you must confirm is that you have a valid contract in a legal sense (offer, acceptance, consideration), which appears to be the case. Then you are entitled to compensation if the other party wants to break the contract.

I'd also point out that there are rules of conduct for solicitors to curtail them from this type of behaviour, and there is a governing body to follow up complaints against solicitors. Generally, the solicitors cover themselves by saying "we are advised by our client that.....". At this point, they are just bluffing; they've spent a couple of hundred bucks for a solicitor, in the hope of saving themselves a greater amount.
 
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NBS said:
I can understand about the break lease part, however on the other side is it worth the 12 mths of life with this tenant once in place.

I can see many stress moments if they are pushed to stay.

Read in detail the lease about cooling off and break lease costs.

Brian
Click to expand...

The landlord isn't requesting compliance of the lease, just reletting costs, as far as I can tell.
 
No cooling off period.

They've signed the lease and are up for full lease break charges.

Apply to VCAT and wipe your hands with it. It's their fault they didn't inspect again prior to signing with their partner.
 
kathryn d said:
I love it when our tenants say "you will be hearing from my lawyer".
We just say, we are looking forward to it.

if they get their scary lawyer to write you a letter.
Click to expand...

Most people have a giggle (like yourselves) when someone says "you will be hearing from my lawyer".

The same people have to take an emergency trip to the toilet when they receive a letter from a scary solicitor. Some pay up.

OP - treat the letter as if it was written by the tenant.
 
Ed Barton said:
OP - treat the letter as if it was written by the tenant.
Click to expand...

It possibly was written by the tenant!

I can't speak for VCAT, but QCAT (basically the same) generally doesn't allow legal representation in the actual hearing - and generally 'legal costs' extends only to the QCAT application fee of $50-$100.

VCAT may make a decision that as the tenants never occupied the property, and there was no real lost opportunity to the owner, the tenants may be liable for beak costs up to the value of the bond or something to that effect, rather than the unlimited liability that a normal breaking tenant may face.

Wait and see, but I can almost guarantee that they won't win.
 
Ed Barton said:
Most people have a giggle (like yourselves) when someone says "you will be hearing from my lawyer".

The same people have to take an emergency trip to the toilet when they receive a letter from a scary solicitor. Some pay up.

OP - treat the letter as if it was written by the tenant.
Click to expand...

+1,
its quite funny how in the last 5-10 years, people seem to think that "you will be hearing from our lawyers" and "I will be pursuing legal action" is a sure way to get what they want.

In a previous life I ran a business, and I literally got anywhere between 1-10 of these threats on a daily basis,

99% of them were so ridiculous, that I used to have a template response which would say "thank you for your response, here is the name of my solicitor, here is the number for department of fair trading and ACCC, please feel free to contact any of them. You need to engage a civil lawyer, not criminal, here are also a few numbers of recommended solicitors in your state"

most of the complaints were based on disputes such as:

- my 500GB Hard disk is only showing up as 480GB, im going to sue you for damages
- my 22" LCD is only 20" width, thats false advertising, im contacting ACA/TT
-your competitor charges $30 for postage, while you charge $35! im going to sue you for mental anguish and stress caused due to that (this is despite the fact that she purchased it for $50 less
- you sold me this for $X 2 weeks ago, Harvey Norman sell it for $X as well, but they include a freebie, I want a refund.
Ok, here is your refund
Im still going to sue you!

naturally, I never heard back from them,

and hence why I am no longer in that business
Good times!
 
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