behind on rent: what actually happens at the tribunal

claire You're overlooking the most important part of falling behind on rent.

eddie You're behind on rent, and a letter turns up from the tribunal. Most people think that's it, the tenancy's over. It isn't always.

claire Okay. Now I'm listening. And I've put my coffee down.

claire Welcome to Both Sides of the Lease. I'm Claire, from Distinct Properties.

eddie And I'm Eddie. I know the date on every notice, which is less fun at parties than it sounds.

claire It's exactly as fun as it sounds. One real story at a time, told from both sides of the lease.

claire Today, what actually happens when the rent falls behind.

claire By the end of this one, you'll know every step from the first missed payment to the hearing, and the one order that can keep a tenancy alive.

claire So Eddie, start at the start. The rent's late. What happens first?

eddie In the ACT, once the rent's a week behind, the lessor can give a notice to remedy. That gives the tenant seven days to pay.

claire And if they don't?

eddie Then a notice to vacate, which gives two weeks. And the lessor can apply to ACAT.

claire So it's not instant. There are steps.

eddie There are. In one hearing, the member said that from the first notice to the hearing, it had taken about twelve weeks.

claire Twelve weeks of letters piling up on the kitchen bench.

eddie Pretty much. Which is why the day itself matters so much.

claire Okay, so we're in the hearing. What does the member actually do?

eddie First, the basics. Who's here, who can speak for whom, and has the tenant got a copy of the application. Then the ledger. How far behind it was on the day it was lodged, and how far behind it is today.

claire So agents, bring the exact number. To the day.

eddie To the day. Then the member asks the owner's side what they want. End the tenancy, or keep it going, with the rent paid on time and the arrears paid off.

claire And that second option is the bit people don't know about.

eddie It is. Instead of ending the tenancy, ACAT can make a payment order. For the arrears, the rent going forward, or both.

claire So there's a way back.

eddie There can be. But the member has to be satisfied the tenant can realistically keep up the payments. So they test it. In this hearing, the member relied on the steady income, not money that might turn up.

claire So, I'm sure something will come through, doesn't cut it.

eddie It doesn't. And then some really practical stuff. The member suggested an automatic deduction, so the money goes out before it can be spent. And the due date was set a couple of days after payday, in case the pay's late.

claire That's actually kind of lovely.

eddie It's sensible. And the member was clear about the deal. The order lasts a year at most. And if it's broken, the lessor can go back, and it can be in front of the tribunal again within a couple of weeks.

claire So it's a lifeline, but a short one.

eddie A short one, with rules.

claire Dumb question. If my situation changes, can I just change the order?

eddie Not on your own. To change it, both sides have to agree, and ACAT has to think it's fair.

claire Okay, lessons. Tenants?

eddie If the letter comes, turn up, with a real number. One you can actually pay, not the one you hope you can.

claire Owners?

eddie Decide before the day whether you'd keep the tenancy going on a payment plan. The member may well ask you.

claire And us, the agency in the middle?

eddie An exact ledger, to the day. And be reasonable. Members notice.

claire Okay, Swap Sides. I'm the owner. Why should I give a tenant who's already behind another chance?

eddie Because a payment order puts the rent and the arrears on a schedule, with a deadline. And if it breaks, you're back in front of the tribunal fast. Sometimes that beats starting again with an empty property.

claire Over the Border. We manage in New South Wales too. What's different there?

eddie The numbers. The rent has to be fourteen days behind before a termination notice, and that notice gives at least fourteen days. The tribunal there is NCAT, and it can't hear the case until that notice runs out.

claire Fourteen and fourteen. Easy to remember.

claire So, three takeaways. In the ACT, a week behind can mean a notice to remedy, then a notice to vacate. A payment order can keep a tenancy going, if the member believes the numbers. And break it, and you're back in front of the tribunal fast.

claire Quick reminder: this is general information, not legal advice, and the details are in the show notes.

claire Next time, another real story from the tribunal, and both sides of it.

eddie Always both sides. That's us for this one. I'm Eddie.

claire And I'm Claire. If this helped, follow and subscribe wherever you're listening, so you don't miss the next one.