Three strikes and you’re out

Over the past month, REIWA has been busy providing feedback to the State Government on its proposed reforms to the Residential Tenancies Act 1987. One of the key changes to the act involved the removal of no grounds terminations.

The Residential Tenancies Act 1987 reforms propose a range of grounds the State Government considers acceptable for ending a tenancy. One of these includes termination for repeated, serious breaches. It’s modelled around legislation in other states whereby a lease can be terminated for repeated breaches within a certain period, such as over 12 months.

We broadly support repeated breaches as an acceptable ground for termination. This will cover issues that are currently not appropriately addressed by legislation and are instead addressed via a no grounds termination.

However, REIWA recommends a number of changes to this approach.

In several states, the legislation allows a lease to be terminated for repeated breaches of the same type. We believe this ground shouldn’t be limited to three breaches of the same type.

It doesn’t make sense that a person could engage in nuisance twice, break strata by-laws twice and threaten agents, lessors or neighbours twice and still not have their lease terminated. A total of three breaches over a 12-month period, made up of any combination of items deemed as serious, should be a ground for termination.

REIWA also believes a three-strikes system should not automatically require a court order, provided that instances of breaches are appropriately documented, communicated to the tenant and neither party disputes the material facts.

A ground for termination based on repeated breaches should also include non-payment of rent, late payment of rent and non-payment of utilities.

Consistent late payment of rent was raised by REIWA members as an area where property managers lacked adequate grounds to terminate a lease, particularly in situations where tenants were consistently in arrears but only paid once a breach notice was issued.

We also believe the definition of a serious breach should include a failure to adequately care for the premises, intentional property damage and a failure to report damage not caused by the tenant that requires immediate and urgent repair.

Consultation on the reforms continues. REIWA remains committed to ensuring the outcome is workable and balanced. We will continue to strive to ensure the changes introduce as little friction into the Western Australian rental market as possible.

However, it must be noted that the need to repeatedly breach tenants in order to manage a tenancy that might not work at some point is going to make the system a lot more complicated, costly and adversarial. No grounds terminations were simpler for everyone and, in many ways, kinder for tenants.