Vacant possession requested - tenant digging heels in for a fight

Hi All,

This is lining up to be our first problem tenant in our landlording history.

This woman moved into our property with the intention of purchasing it. Contract was exchanged subject to finance. (2 weeks) After several months of extentions to her finance clause we decided to no longer give extentions. She then recinded the contract of sale and her deposit was refunded. We put the property back on the market while keeping the door open for her if her finance was approved. On 20th Dec we exchanged an unconditional contract (35 day settlement - vacant possession) and my lawyer advised to serve her 30 days notice. On 21st Dec a letter was delivered to her door. She failed to answer the knock so letter was slipped under the front door. Later that day we received this email -

I received the notice this morning which woke me. Also 48 hours notice is required for anyone to enter the property. 2 weeks ago the realestate were notified of my holiday arrangements being that l would be returning on the 25th January 2014. Which you were informed of. So you have served a notice requesting me to vacate when you know l wont be here.... The ctt have been notified and an order will be made in my favour as its all in writing .I have been advised to let you know in writing that as l am a paying tenant and correct notification has not been given l am to let you know that l do not give my permission for anyone to enter the property whilst l am on holiday.

I replied with this.
Nobody entered the residence at ........ this morning. A notice was merely delivered to your front door around 9am.
Despite inconveniences for both parties, our own recent discussions with Department of Fair Trading (DFT) outlined the fair legal responsibilities according to our lease. We merely acted on the advice given by DFT within the terms of the agreement and are attempting to do things fairly, in compliance with the lease. You were well aware that the property could be sold at any time and our lease agreement clearly states the terms of notice required in such a situation. We had no foresight of the timing of the sale. We cannot see any mention in the lease agreement that going on holidays constitutes grounds for waiving or changing the terms for issuing notice to vacate.

If you are unwilling to vacate on this date we shall, again, follow fair and due process which allows the Consumer Trading and Tenancy Tribunal to make a ruling.

Apparantly she is spending most of her holidays in Melbourne but maybe going overseas for a short period. I do have to provide a Home Owner Warranty Insurance certificate for the sale since it was an owner built property. This requires an inspection to be carried out by a building certifier in the next couple of weeks. It seems I have to give her 7 days written notice for an inspection to occur. Just wondering what happens if she ignores any request and how to proceed from here?

Any info appreciated. :(
 
Why did you let a BUYER become a TENANT? Now the full force of the rental tenancy act applies.

Get legal advice quick else weeks could turn into months until the tenant vacates, and advice with regards to your obligations for the contract of sale.

By the sounds of things you need to get the advice of a different lawyer to the one who is managing the sale. (The lawyer needs to be experienced in tenancy law, not conveyancing.)
 
She moved in 'under licence' and signed a standard lease agreement which would have lapsed upon her finance being approved. Since she recinded the contract of sale it ended up reverting to a continuing rental agreement.
Agreed, a bit messy though I am expecting that now she is just a tenant on a continuing agreement. She has been paying weekly rent all this time.
 
Lodge your claim for vacant possession with the OFT asap. That way you will have your order for vacant possession in the same timeframe as settlement. Lodge on line.

(I am assuming that your property is in NSW).
 
Lease signed on 26th July
Contract of sale exchanged on 20th Sept

There was a special condition written into the lease that the tenancy agreement will cease when settlement of sale occurs between us and her. No bond was taken - mistake No. 2. Mistake No. 1 was to let her move in without an unconditional contract.

Much to learn from this one. :(
 
if there is no fixed term, vp will require an unconditional vacate notice to be served., ie 90 days not 30 days. Contact the OFT and confirm (yes they are working today) & re-serve notice TODAY.
 
This almost sounds like somebody who had this plan from the start. She seems to know the laws and procedures well- perhaps she is getting advice from a tenancy service.

Get good professional advice.
 
if there is no fixed term, vp will require an unconditional vacate notice to be served., ie 90 days not 30 days. Contact the OFT and confirm (yes they are working today) & re-serve notice TODAY.

Hi Scott,

According to the lease Note 4 "Ending a periodic agreement" states:
Other examples of where a periodic agreement can be ended are when a contract for sale of land requiring vacant possession has been exchanged (in which case the notice period is not less than 30 days); a party has breached the agreement(in which case the notice period is not less than 14 days or when the rent has remained unpaid for not less than 14 days.

This is the letter of notice we served on her.

Dear ......,

We have exchanged an unconditional contract for the sale of ........... As stated in our lease agreement dated 26/07/2013, Page 10 ? Note 4, we are giving you the required 30 days? notice to vacate so that the new owners can move into the premises upon settlement. Monday 20th January 2014 will be the date you are required to vacate by. Since you have already paid rent up until Friday 10th Jan the final rent payment until Monday 20th would be $542.85. We will take a water meter reading on the vacating date and forward the amount payable soon after.
 
This almost sounds like somebody who had this plan from the start. She seems to know the laws and procedures well- perhaps she is getting advice from a tenancy service.

Get good professional advice.

She seemed very keen to buy the place Geoff but, perhaps, now she can't buy it she is hanging in for as long as possible. I know she spent time with a couple of banks and a broker. The rent she is paying is definitely not below market - maybe a little above. She did have a whinge that she couldn't afford the rent for too much longer.
Now she can, not only, afford the rent but also go on a 1 month holiday so I would imagine she won't be able to claim financial hardship as an excuse.
 
This almost sounds like somebody who had this plan from the start. She seems to know the laws and procedures well- perhaps she is getting advice from a tenancy service.

Get good professional advice.

Rocky, sorry to hear of this, but thanks for your candid sharing of things that can go wrong and things that shouldn't be omitted from such transactions and contractual documentation.

Get legal advice post haste. Terry w from this site may be able to assist you as he is in NSW or at least lead you to someone experienced in property law if you don't have any leads to a competent lawyer in your neck of the woods.

All the best..............this too shall pass. :( :)
 
Now she can, not only, afford the rent but also go on a 1 month holiday so I would imagine she won't be able to claim financial hardship as an excuse.


Don't rely on this. The holiday may have been a gift (or claimed to be. Not hard to get a friend or relative to give statements).

Just consider the bankrupt high-fliers who live "rent free" in properties owned by "friends".
Marg
 
Thanks Player and Marg.

I will call CTTT and seek some advice first. Already called DFT and they rekoned it was pretty clear cut that she had to go.
The sale of the property is not a huge issue as we were about to rent it out prior to her coming on the scene. Twas a 55/45 decision to accept the offer. As long as she continues paying the rent there shall be little loss really. The 2 main reasons for selling were
1) I was asked to pay back a private loan we had against the property (we can refinance to pay this off if necessary)
2) It was our PPR and it seemed simpler to sell it tax free now rather than convert to an IP and pay CG down the track. I guess we could hold it long term which could be fine as well.
 
...The sale of the property is not a huge issue...

You wrote that the sale is already unconditional and contracts exchanged: that means that they have to buy and you have to sell, and it's meant to be vacant possession.

If you cannot vacate the house and the sale has to be rescinded, what recourse for damages does the buyer have? (What if they have already sold?)
 
If you cannot vacate the house and the sale has to be rescinded, what recourse for damages does the buyer have? (What if they have already sold?)

Not sure as I've never been in this situation. We will, of course, proceed to evict her if possible and finalise the settlement. The tribunal will make an order and all will have to abide by it. If she digs in for a fight the sherrif will be called in to sort it out I guess. I will keep my lawyer and the selling agent in the loop throughout every step. Not sure what else I can do apart from seeking advice from a specialist lawyer like others have suggested. The case seems pretty clear cut and I hope she moves on willingly for everyones sake.
 
Rockstar if tribunal rules in her favour you will certainly be up for any costs incurred by buyer due to you not
settling on time

Best wishes, sounds like a messy situation. Did you receive any legal advice prior to entering into this arrangement?
 
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