Darwin Community Legal Service

Hardship

In the Northern Territory, a tenant can apply to have their fixed term tenancy agreement terminated (brought to an end) early if continuing the tenancy would cause them undue hardship.

Hardship can be financial or personal. You may want to end your tenancy agreement because of hardship reasons.

What are my options?

You and your landlord can both agree to end your tenancy at any time. You should tell your landlord if your circumstances have changed and it is now hard for you to continue your tenancy. You may be able to negotiate a new end date. This agreement must be in writing.

If your landlord does not agree or refuses to negotiate, you may apply to the Northern Territory Civil and Administrative Tribunal (NTCAT) to terminate your tenancy agreement. Your application should explain how you are affected by hardship.

You can obtain NTCAT application forms from the NTCAT website: http://www.ntcat.nt.gov.au

Tip: Do not sign any ‘break-lease’ form! Do not return your house keys!

Do not sign any form that says that you wish to ‘break-lease’.

If you wish to apply to NTCAT, do not hand your house keys back to the landlord. Doing either of these things may mean you are unable to make a hardship application. Seek legal advice if your landlord wants you to do either of these things.

Applying to NTCAT

When you apply to NTCAT to end your tenancy agreement due to hardship, you must show that:

  • You are unable to continue your tenancy because it would result in hardship to you; and
  • The circumstances of hardship arose after you signed the tenancy agreement.

What will the NTCAT consider?

The NTCAT will assess your application. Some of the factors that the NTCAT will consider include:

  • The circumstances of your hardship (financial, personal or otherwise).
  • How your hardship affects you.
  • When the circumstances of hardship arose.
  • Your existing assets.
  • How the early termination will affect the landlord.
  • The time remaining on your tenancy agreement.
  • The rental market and how likely your landlord is able to find a tenant to replace you.

Every application will be judged on its own particular facts.

 

Examples of unsuccessful applications

Some applications to NTCAT on the grounds of hardship are unsuccessful. Sometimes, NTCAT may decide to continue your tenancy agreement.

For example, you may experience financial hardship because you have lost your job. However, if you have a substantial asset (such as ownership of a home), NTCAT may be less likely to terminate your tenancy agreement.

For another example, you may have obtained a bank loan before signing your new tenancy agreement. You then find that you cannot afford to make your loan repayments and your rental payments. NTCAT may not terminate your tenancy agreement because you were aware of your financial obligations before signing your tenancy agreement.

Case Example 1 – Illness Sloane signed a tenancy agreement for a period of two years. During the tenancy, he was diagnosed with an illness. Sloane had to move interstate to access medical treatment. Sloane wanted to end his tenancy agreement on the grounds of personal hardship. His landlord refused to negotiate. Sloane applied to NTCAT. NTCAT agreed to terminate his tenancy agreement because of undue hardship.

 

Case Example 2 – Loss of Job Yukie was promised a permanent job for two years. She expected to have stable and secure employment for the next two years. Yukie entered into a new tenancy agreement. However, after working for six months, Yukie lost her job. She was unable to find another job that was in her area of experience and training. Yukie spoke with her landlord. She explained that she had to move to a different city to find work. Her landlord agreed to end the tenancy early, without Yukie having to pay any more rent. Yukie and her landlord made this agreement in writing.

 

What happens if NTCAT terminates my tenancy?

When NTCAT terminates a tenancy agreement early on the grounds of hardship, they set the new date that the agreement comes to end. Your rights and responsibilities as a tenant will terminate at that date.

 

Darwin Community Legal Service 2017: Non-profit community groups have permission to reproduce parts of this publication as long as the original meaning is retained and proper credit is given to DCLS, as the publisher.

Disclaimer: The information contained in this publication is a guide to the law in the Northern Territory. It is not a substitute for legal advice. You should talk to a lawyer about your particular legal issue. The information contained in this factsheet is current as at November 2017

 

Rent increases and reductions

How often a landlord can legally increase the rent for a rental premises depends on the type of tenancy agreement and the terms of that agreement.

Fixed term tenancy agreement

A fixed term tenancy agreement is for a set period of time, for example 12 months. Under a fixed term tenancy agreement, the rent cannot be increased unless the agreement contains a term setting out:

  • the right to increase the rent; and
  • the amount of the increase or the way an increase will be calculated.

The landlord must also give you at least 30 days written notice of a proposed rent increase, setting out details of the amount of the increase and the date you need to start paying the increased rent. If the landlord does not give such a notice, you are not required to pay the increased rent. In this factsheet, a reference to a landlord generally includes a real estate agent or another person acting on the instructions of the landlord.

Under a fixed term tenancy agreement, rent cannot be increased in the first six months of the tenancy, or within six months of the last rent increase.

Periodic tenancy agreement

A periodic tenancy agreement is where there is no fixed term or where the fixed term has expired. Under a periodic tenancy agreement, each rental period is treated as a separate tenancy agreement. A rental period will be one week if you pay your rent weekly, and a fortnight if you pay your rent fortnightly. This means that a landlord can give a new rent increase at the start of each rental period.

If you refuse to pay the proposed increase, the landlord can terminate the tenancy

Negotiating a lesser increase

If you cannot afford to pay the increased rent, you can ask the landlord to reduce the increase. You should inform the landlord how much of an increase you can afford and your reasons for requesting a smaller increase. Any agreement you reach should be in writing and signed by you and the landlord.

Challenging a rent increase at the NTCAT

If you believe the rent payable under your tenancy agreement is excessive, you can apply to the Northern Territory Civil and Administrative Tribunal* (‘NTCAT’).

The NTCAT can decide whether the rent payable is excessive considering:

  • the general level of rents for similar premises in your area (i.e. market rent); and
  • the cost of any services provided by you or the landlord under your tenancy agreement (e.g. gardening or pool maintenance).

The NTCAT will not consider whether you can afford the increased rent. If the NTCAT finds that the rent payable is excessive, it can specify the rent payable under the tenancy agreement for a maximum period of 12 months. You should keep paying the increased rent unless the NTCAT orders otherwise.

Department of Housing tenants

The law around rent increases applies to the Department of Housing, except where:

  • your rent has increased because your rental rebate has been cancelled or adjusted; or
  • your tenancy agreement contains a term that states your rent will change automatically at certain intervals as set out in the tenancy agreement or by a decision of the Minister for Housing.

Rent reduction for withdrawal of services If you are not able to fully use and enjoy the rented premises because the landlord has breached a term of the tenancy agreement, you are entitled to a rent reduction. For example, if the landlord does not repair a broken air conditioner, you can request a rent reduction from the date that the landlord fails to do the repair to the date it is repaired.

Any agreement you reach should be in writing, and be signed by both you and the landlord. If you do not reach an agreement, you may apply to the NTCAT for an order that the rent is excessive given the level of services that has been withdrawn. Among other things, the NTCAT will consider whether the level of services provided under the tenancy agreement has been significantly reduced. You will need to provide evidence to show what was withdrawn, how long it was withdrawn for, and by how much your rent should be reduced. You should keep paying your usual rent unless the NTCAT orders otherwise.

Darwin Community Legal Service 2015: Non-profit community groups have permission to reproduce parts of this publication as long as the original meaning is retained and proper credit is given to DCLS, as the publisher.

Disclaimer: The information contained in this publication is a guide to the law in the Northern Territory. It is not a substitute for legal advice. You should talk to a lawyer about your particular legal issue. The information contained in this factsheet is current as at November 2014.