Ending a tenancy: Rental provider wants renter to leave
If you have been given an immediate Notice to Vacate, contact Tenants Victoria straight away (see ‘Contacts’ at the end of this chapter).
Overview
If a rental provider wants to end a rental agreement and evict a renter, they must follow the specific process set out in the RT Act. This process starts with a Notice to Vacate. A Notice to Vacate includes a termination date, but the renter cannot be forced to vacate the property on this date. If the renter does not vacate, this forces the rental provider to apply to VCAT for a ‘possession order’. Both the rental provider and the renter will have their say about whether the agreement should be ended based on the RT Act and circumstances.
A new feature of the RT Act is the ‘reasonable and proportionate test’ (RT Act ss 330, 330A). This is a relatively conservative test, and not a general defence to challenge possession orders. However, the test must be correctly applied. This means the test must be actively engaged with both the criteria of the test and the impact of the final possession order, should one be made. The RT Act permits a rental provider to give a renter a Notice to Vacate in certain circumstances. The amount of time the rental provider must give the renter to vacate varies and depends on the type of notice given.
Only the police can lawfully enforce an eviction; this requires a warrant to be issued by VCAT. Warrants are only issued by VCAT if a possession order has been made by VCAT. A possession order hearing can only take place if a renter has not left in response to a valid Notice to Vacate that has been served correctly.
Thus, a renter does not need to vacate on the termination date given in the Notice to Vacate. If the renter remains in possession of the premises, the rental agreement is not terminated until a warrant of possession is executed. If the renter wishes to remain in the premises, there may be grounds on which they can challenge a Notice to Vacate or seek additional time before the warrant of possession can be used to evict them. (See ‘Procedure for ending a rental agreement’, below.)
In many applications for a possession order (other than applications to end fixed-term rental agreements), the rental provider must specify the acts, facts, matters and circumstances, including relevant dates, that are to be relied upon as the basis for giving the Notice to Vacate. There are now additional requirements for some Notices to Vacate that require specific documentary evidence to be attached for the notice to be valid. A notice that does meet the requirements set out in the RT Act may be invalid (s 91ZZO). This means that VCAT does not have the power (sometimes referred to as ‘jurisdiction’) to grant a possession order and the rental agreement continues.
Note that the previous ‘no reason’ Notice to Vacate (former RT Act s 263) has been repealed, and a rental provider cannot evict a renter without a reason. The only notice that is similar to this is the end of the initial fixed-term agreement notice.
If there is any doubt about the validity of a Notice to Vacate, parties should seek legal advice.
Immediate Notice to Vacate
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A rental provider may give a renter an Immediate Notice to Vacate if the renter or their visitor intentionally or recklessly caused serious damage to the rented premises, including any safety equipment, or to common areas (RT Act s 91ZI). Note that the renter has an obligation to not remove, deactivate or otherwise interfere with the operation of safety devices (e.g. smoke alarms and fire hydrants) unless it is reasonable to do so (s 63A(1); reg 25). VCAT can award a compliance order instead of a possession order if it considers it appropriate in the circumstances (s 332A).
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A rental provider may give the renter an Immediate Notice to Vacate if the renter or their visitor endangered the safety of neighbours, the rental provider, or an agent, contractor or employee of the rental provider or agent (RT Act s 91ZJ). If the rental provider gives the renter an Immediate Notice to Vacate under section 91ZJ of the RT Act, they must prove that the renter’s (or visitor’s) behaviour is such that the safety of the person was clearly endangered. It is not enough that they felt threatened by the renter. The danger must also be continuing at the time that the Immediate Notice to Vacate is given. These cases often involve quite complicated questions of law and fact.
The RT Act now requires VCAT to also consider the Director’s Guidelines (published on CAV’s website). Guideline 5 sets out relevant case law and factors that VCAT must consider in relation to an Immediate Notice to Vacate (s 330(3)). VCAT can award a compliance order instead of a possession order if considers it appropriate in the circumstances (s 332A).
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The rental provider may give the renter an Immediate Notice to Vacate if the premises are unfit for human habitation or have been destroyed totally, or to such an extent as to be rendered unsafe (RT Act s 91ZL). Even if the renter has been given this notice, they are entitled to challenge the notice, and concurrent urgent repair actions should be considered. While a postponement of the warrant is not strictly available (s 352), VCAT may consider the time when the possession order is to take effect (s 333). Considerations of risk and safety are important. Councils may also have relevant powers under the Building Act 1993 (Vic), which renters and rental providers may wish to investigate.
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The housing crisis and inflation continue to drive rent prices upwards and increase the number of renters facing eviction for rent arrears. It is prudent that people facing eviction for rent arrears seek legal and financial counselling as soon as practicable as repayment plans can be obtained in many situations. Repayment plans do not result in a tenancy database listing (see ‘Tenancy databases’ above). Ultimately, VCAT will want to know if the usual rental payments can be made and also whether a payment plan to discharge the arrears over a reasonable period of time can be made.
For renters facing eviction, attending the hearing may give them an opportunity to ask for additional time (up to a maximum of 30 days if they can show severe hardship) (RT Act ss 352, 333). Usually, the prospects of eviction and homelessness will be considered to have significant weight)).
Rental providers should also seek to identify any rights they may have in relation to mortgage moratoriums or other relief to ensure eviction for rent arrears is a last resort. Unfortunately, for many, eviction will be a reality, and early planning, alternative housing and support resources should be investigated as early as possible.
Rent accrues daily (RT Act s 39). If a renter owes 14 days or more rent a rental provider may give them a 14-day Notice to Vacate (s 91ZM). The reasonable and proportionate test does apply to rent arrears, but it will not operate as a defence to significant arrears that cannot be repaid. Further, a notice that significantly overstates the amount of rent owed is invalid. It is important to review the history and validity of rent increases when a renter faces a Notice to Vacate for rent arrears, as an invalid notice of rent increase may significantly change the amount of rent owed (if any). See ‘Rent increases’, above.
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If the notice is the first, second, third or fourth Notice to Vacate for overdue rent in a 12-month period, and the renter pays all the unpaid rent before the termination date, the notice will have no effect (RT Act s 91ZM(1)). The rental provider cannot apply to VCAT for a possession order, but if they do, VCAT must dismiss the application (ss 91ZM(1), 331(4)). This applies even if further arrears have been accrued after the Notice to Vacate was issued.
The first 12-month period is set from the day the initial rental agreement starts (RT Act s 91ZM). The ‘count’ (referred to as ‘occasions of non-payment of rent’) for the first four notices to vacate for overdue rent restarts each time the next 12 months begin, i.e. on the anniversary of the initial rental agreement.
It is important to note that even if the rent arrears are paid off before the termination date, the Notice to Vacate (if valid) will still add to the court towards a fifth notice, which alters the renter’s available rights when in rent arrears.
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First, second, third or fourth Notice to Vacate
If the notice is the first, second, third or fourth Notice to Vacate for overdue rent in a 12-month period, and the renter did not pay the rent before the termination date, the notice will have effect (RT Act s 91ZM(1)). This means the rental provider can apply to VCAT for a possession order if the renter chooses to stay beyond the termination date (s 91ZM(1)).
At the possession order hearing, VCAT can decide to dismiss the application, adjourn the application, including making a payment plan, or make a possession order (ss 91ZM, 331).
VCAT has the discretion to adjourn or dismiss a rental provider’s application for a possession order on the basis of rent arrears if it believes satisfactory arrangements have been or can be made to avoid financial loss to a rental provider (RT Act s 331(1)).
It is important to present evidence showing:
the reason the renter fell behind in their rent;
the renter’s ability to pay the rent on time in the future; and
the renter’s ability to repay the overdue rent.
A renter should produce evidence including:
a statement from a financial counsellor outlining their income and expenditure and how much they can afford to pay for each instalment (if they are offering to pay by instalments);
medical certificates if the renter has been ill, injured or unable to work;
witnesses who can give evidence about why the renter fell behind in their rent and can confirm that the renter can pay the overdue rent (e.g. a new employer);
copies of bills for unexpected expenses; and
evidence of income (tax returns, pay slips, etc.).
The renter should also ask anyone able to provide evidence in support of their case to attend the VCAT hearing to give evidence in person. It is better to have a witness attend the hearing than give their evidence in writing or a statutory declaration.
At the hearing the renter should explain how they fell behind in rent and how they intend to repay the overdue rent. If VCAT is convinced that the renter had a good reason for falling behind in the rent, that the renter intends to repay the amount owed, and that the renter can afford to pay the rent in the future, it will generally exercise its discretion not to evict the renter.
If VCAT thinks the renter could pay off the overdue rent over time, they can decide to adjourn the application and make an order for a payment plan instead of making a possession order (RT Act s 331(2)).
If VCAT is not sure of the renter’s financial ability to enter a payment plan, they can put the application on hold and refer the renter to a financial counsellor who can help assess their financial situation (RT Act s 331(1A)). If VCAT refers the renter to a financial counsellor they may ask the counsellor to write a report or report verbally to VCAT after their assessment (ss 331(1B), (1C)). This can help VCAT decide if a payment plan should be ordered instead of a possession order.
If VCAT decides to make an order for a payment plan, it will generally order that the rental provider’s application be adjourned for a certain period (usually three to six months).
If the renter follows the VCAT order and pays their usual rent and overdue rent on the terms in the order, VCAT must dismiss the rental provider’s application for a possession order and the rental agreement continues as normal (RT Act ss 91ZM(3), 331(3)).
If the renter fails to pay the instalments, or if they fall behind in their rent again during this period, the rental provider can ask VCAT to renew their application. The rental provider does not have to serve any further notices on the renter in these circumstances. VCAT will send the renter a notice of hearing. The renter should go to the hearing and tell VCAT why they did not, or could not, follow the payment plan order or why they accumulated more overdue rent. If their financial circumstance has become worse, they can ask VCAT to make an order for a different payment plan that they will be able to better follow. As for the first hearing, if VCAT decides the renter can afford to pay the overdue rent and not get further behind with the rent, it may change the payment plan, or order a new one with different payments and time periods (RT Act s 331).
If VCAT decides – at a possession order hearing or a renewed possession order hearing – that the renter cannot afford to pay the overdue rent and their usual rent without getting further behind, it will consider if it is reasonable and proportionate to make a possession order (RT Act s 330). See also ‘Reasonable and proportionate test’, below. Rent owed under a payment plan ordered by VCAT is not considered to be rent arrears for the purposes of issuing a Notice to Vacate (s 91ZM(7)). It is not clear if a rental provider who deliberately delays going to VCAT until the fifth Notice to Vacate will be considered to have abused the process.
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If the rental provider has given the renter five Notices to Vacate for overdue rent in a 12-month period (counted from the date of the rental agreement or the date the renter moved in) and the renter has not moved out by the termination date in the fifth notice, the law is slightly different. The rental provider can apply to VCAT for a possession order even if the renter paid the unpaid rent before the termination date (RT Act s 91ZM(2)). If the rental provider does apply to VCAT for a possession order, VCAT must make a possession order if it is reasonable and proportionate to do so (s 330).
The option to refer the renter to a financial counsellor is not available for the fifth Notice to Vacate. The option to adjourn to allow for a payment plan is also not available as it was for first four notices to vacate (RT Act s 91ZM(2)).
However, there is still a possibility that VCAT could dismiss or adjourn the rental provider’s application for a possession order if they do not think it is reasonable and proportionate to make a possession order (RT Act ss 91ZM, 330). There is limited case law in relation to this, but it is in the renter’s best interest to give as much context as possible as to the reason for the arrears. The renter can also request an extension of time to delay the purchase of the warrant. (See ‘Reasonable and proportionate test’ and ‘Request to postpone the warrant’, below.)
Other 14-day Notices to Vacate
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The rental provider can serve the renter with a 14-day Notice to Vacate if the renter or another occupier was seriously threatening or intimidating to the rental provider, or agent, or their contractor or employee (RT Act s 91ZK). This Notice to Vacate can be challenged to be of no effect if the renter can show it was given in response to them exercising, or proposing to exercise, a right they have under this RT Act (s 91ZZI(3)). Threats must be more than idle and have a degree of malice and likelihood of being carried out. VCAT can award a compliance order instead of a possession order if it considers it appropriate in the circumstances (RT Act s 332A).
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The rental provider can serve the renter with a 14-day Notice to Vacate if the rental agreement says a bond must be paid and the renter does not pay the bond (RT Act s 91ZN).
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The rental provider can serve the renter with a 14-day Notice to Vacate if the renter uses or permits others to use the premises for any purpose that is illegal at common law or under an Act (RT Act s 91ZQ).
Note there is a difference between an offence that arises out of the use of the premises (e.g. operating an unlicensed brothel) and the premises being merely the scene of an offence (e.g. an assault).
Whether the renter has permitted the premises to be used for an illegal purpose may become an issue. Factors often considered to be relevant are whether:
a renter knows of the use of the premises for an illegal purpose; and
fails to take steps to prevent the illegal use.
However, there may be circumstances in which the offender overbears the renter’s will, so it cannot be said that the renter voluntarily permitted the offender to remain on the premises (e.g. where the renter is the victim of family violence by the offender). It is likely that such an incident involved the police and any charges are relevant. The reasonable and proportionate test will be relevant to these matters.
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The rental provider can serve the renter with a 14-day Notice to Vacate if the renter assigns, sub-lets, or purports to assign or sub-let, the premises without the rental provider’s consent (RT Act s 91ZV). (See ‘Sub-letting’, above.)
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Section 91ZP of the RT Act permits a rental provider to serve a 14-day Notice to Vacate for successive breaches of a duty provision (see ‘Duties of rental providers and renters’, above).
This requires the rental provider to have served two previous breaches of duty notices for breaches of the same ‘duty provision’ (RT Act s 91ZP(1)(b)). Upon the third breach of the same duty provision, a Notice to Vacate may be served on the renter. Alternatively, if a third breach notice is given, the rental provider must wait for the required time to lapse before giving the Notice to Vacate.
The rental provider must prove on the balance of probabilities that each breach has occurred. If any breach fails to be proven, or the notice does not adequately set out the details and circumstances upon which notice was issued, then the Notice to Vacate may be dismissed. This may or may not preclude subsequent applications depending on the reasoning by VCAT regarding the validity of any of the Breach of Duty Notices.
While a successive Notice to Vacate was previously a high risk for renters because it mandated VCAT to give a possession order, there may be some limited defence under the reasonable and proportionate test even if the successive breaches are established. It would be onerous, but VCAT may be able to adjourn or dismiss the application if the renter can show a genuine change in action, circumstances or willingness to address the breaches and merit the continuation of the rental agreement. A compliance order is not available (RT Act s 332A).
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If a renter has been given a Breach of Duty Notice (RT Act s 208), a rental provider can apply to VCAT for a compliance order (s 209). If a breach is proven, VCAT may make a compliance order. To be a valid compliance order, the order must contain a caution that if the renter does not comply with order, the rental provider may serve a Notice to Vacate (s 212(4)).
If this order is not complied with, then the rental provider may serve a Notice to Vacate pursuant to section 91ZO of the RT Act. The rental provider bears the onus of proof of showing there has been non-compliance with the order. There is some, but limited, discretion afforded to VCAT with respect to trivial non-compliance that is not a recurrence of a previous breach and is not likely to occur again (RT Act s 332).
The RT Act now also provides that compliance orders may be made in lieu of possession orders for Notices to Vacate for danger, damage or threat and intimidation (RT Act s 330A). Any compliance order made should be measurable, specific and, most importantly, time limited (as the compliance order will otherwise operate indefinitely while the rental agreement continues). See ‘Social housing’ and ‘Rental laws and human rights’, below.
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The rental provider can serve the renter with a 14-day Notice to Vacate if the renter has failed to comply with a term of the rental agreement that prohibits the renter from permitting a child aged under 16 years to live at the premises (RT Act s 91ZT).
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If the renter lives in public housing, a 14-day Notice to Vacate can also be served on the renter by the rental provider if they have:
committed, or allowed another person to commit, drug offences, such as trafficking, supplying, and cultivating (RT Act s 91ZR); or
misled the rental provider about their eligibility for public housing (s 91ZU).
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The rental provider can serve the renter with a 14-day Notice to Vacate if the property was their principal place of residence immediately before the rental agreement started, but only if:
the rental agreement stated that the property was their principal place of residence and they intended to move back in at the end of the renter’s first or second fixed-term rental agreement; and
the notice is given before the end of the first, or second, fixed-term rental agreement (RT Act s 91ZW).
The notice must include documentary evidence to support the reason for giving the notice (RT Act s 91ZZO). The documentary evidence required is both:
the rental agreement; and
a witnessed statutory declaration signed by the rental provider, confirming the date they intend to resume occupancy.
60-day Notice to Vacate
The following notices to vacate are sometimes referred to as ‘no-fault’ notices to vacate because the rental provider can give them at any time as long as the termination date is on or after the last day in the fixed-term agreement. A no-fault Notice to Vacate with a termination date before the end of the fixed-term agreement will generally be invalid (RT Act s 91ZA)(1)(b)).
Most of the no-fault notices also have documentary evidence requirements, which are published on CAV’s website (www.consumer.vic.gov.au). A notice that does not have the required documentary evidence attached to the Notice to Vacate at the time of serving is invalid (RT Act s 91ZZO(e)).
In general, the reasonable and proportionate test may provide a defence in exceptional circumstances to ‘no-fault’ Notices to Vacate. However, the law is still relatively new in this regard, and Notices to Vacate should always be treated seriously as they pose a genuine risk that VCAT will make a possession order.
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The rental provider may give the renter a 60-day Notice to Vacate if the premises are to be immediately occupied:
by the rental provider, or rental provider’s partner, child, parent or partner’s parent; or
by a person who normally lives with the rental provider and is substantially or wholly dependent on the rental provider (RT Act s 91ZZA).
The Notice to Vacate should specify the relationship of the family member or dependent person. The rental provider or their family member must intend to occupy the premises immediately after the termination date in the Notice to Vacate. The notice is likely not valid if a delay is planned between the termination date and the date the family member or rental provider will take occupation of the premises.
If there is a fixed-term rental agreement, the notice must not specify a termination date that is earlier than the last day of a fixed-term rental agreement (RT Act s 91ZZI(1)(b)). A rental provider who obtains possession of the premises after serving a notice under this section must not re-let the premises to another person within six months of giving this notice (s 91ZZH(1)). This prohibition does not apply to the rental provider renting the premises to the person referred to in the notice (s 91ZZH (2)).
The notice must include documentary evidence to support the reason for giving the notice (RT Act s 91ZZO). The documentary evidence required is a statutory declaration signed by the rental provider stating either:
that they intend to reside at the rented premises; or
the name of the person who will occupy the premises, their relationship to the rental provider and a declaration of whether the person is a dependent.
The statutory declaration must also include a statement that the rental provider understands that they must not re-let the premises to any person other than the person named to be moving into the rented premises in the statutory declaration for use primarily as a residence before the end of six months after the date on which notice was given, unless approved by VCAT.
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The rental provider may give a 60-day Notice to Vacate if the premises is to be sold or offered for sale with vacant possession (RT Act s 91ZZB). The rental provider must intend to sell the premises or offer it for sale immediately after the termination date in the Notice to Vacate.
If the contract of sale contains conditions that, if not satisfied, entitle a party to terminate a contract, the rental provider may, within 14 days after the last of these conditions is satisfied, give the renter a Notice to Vacate (RT Act s 91ZZB(2)). If the contract is not conditional, the rental provider may, within 14 days after the contract of sale was entered into, give the renter a Notice to Vacate (s 91ZZ(3)).
If the property has been sold, the contract of sale must be attached to the Notice to Vacate. Renters should check when the sale became unconditional and compare this to the date of the Notice to Vacate. If the Notice to Vacate was not given within 14 days of the unconditional sale date, the notice is invalid.
If there is a fixed-term rental agreement, the notice must not specify a termination date that is earlier than the last day of a fixed-term rental agreement (RT Act s 91ZZI(1)(b)).
A rental provider who obtains possession of the premises after serving a notice under this section must not re-let the premises to another person within six months of giving this notice (s 91ZZH(1)).
The notice must include documentary evidence to support the reason for giving the notice (RT Act s 91ZZO). The documentary evidence required is:
contract of sale, signed by the vendor and purchaser and dated;
contract of engagement or authority to sell with a licensed estate agent; or
preparation of a contract of sale prepared by a conveyancer or lawyer.
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The rental provider may give the renter a 60-day Notice to Vacate if the rental provider intends to immediately repair, renovate or reconstruct the premises, and the work cannot be carried out without vacant possession (RT Act s 91ZX).
The rental provider must have obtained all necessary permits and consents to do the work prior to issuing the Notice to Vacate (RT Act s 91ZX(1)(b)).
The renter can challenge the notice if they believe that the renovations do not necessitate them moving out. The renter must provide evidence to that effect (e.g. statements from tradespeople, photographs and witness statements).
The key question may be whether such work is so extensive as to require vacant possession. The rental provider must also be able to demonstrate to VCAT that they have all necessary permits, if applicable.
If there is a fixed-term rental agreement, the notice must not specify a termination date that is earlier than the last day of that agreement (s 91ZZI(1)(b)).
The prohibition on re-letting premises for six months after the date the notice was given does not apply to notices issued under section 91ZX of the RT Act. The notice must include documentary evidence to support the reason for giving the notice (s 91ZZO).
The documentary evidence required is:
a building permit for repairs or renovation; or
photographic proof that the repairs are required and a contract with, or quotation from, a suitably qualified tradesperson for carrying out planned repairs stating:
the nature of the repairs required;
the reasons why the premises need to be vacated by the renter in order to carry out the repairs; and
an estimate of the length of time it will take to complete the repairs.
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A rental provider may give a 60-day Notice to Vacate if they intend to demolish the premises immediately after the termination date (RT Act s 91ZY). A rental provider must have obtained all the necessary permits before issuing the Notice to Vacate (RT Act s 91ZY(1)(b)).
A rental provider must be able to show VCAT that they have all the necessary permits to demolish the premises. If they cannot show this, the renter can ask VCAT to dismiss the rental provider’s application for possession. The local council can tell the renter if a demolition permit has been granted.
If there is a fixed-term rental agreement, the notice must not specify a termination date that is earlier than the last day of the agreement (RT Act s 91ZZI(1)(b)).
A rental provider who obtains possession of the premises after serving a notice under this section must not re-let the premises to another person within six months of giving this notice (RT Act s 91ZZH(1)). The notice must include documentary evidence to support the reason for giving the notice (s 91ZZO). The documentary evidence required is a building permit for the demolition and a contract with a suitably qualified builder-demolisher, stating the date that demolition will occur.
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This notice is only available in relation to first fixed-term rental agreements. If a rental provider wants the renter to move out once the initial fixed-term rental agreement has ended, the Notice to Vacate must be served:
at least 90 days before the last day of the initial fixed-term rental agreement, if the rental agreement is for a fixed term of six months or more (RT Act ss 91ZZD(3), 91ZZDA(3)); or
at least 60 days before the last day of the initial fixed-term rental agreement, if the rental agreement is for a fixed term of less than six months.
The termination date in the notice cannot be a date that is before the end of the initial fixed-term agreement (RT Act ss 91ZZD, 91ZZDA) (see also ‘Retaliation’, below).
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When a mortgage over the premises was entered into before the rental agreement was entered into, and the mortgagee (usually a bank) becomes entitled to possession of, or the right to exercise a power of sale over, the premises, the mortgagee may give the renter a 60-day Notice to Vacate (RT Act s 91ZZK(1)). This Notice to Vacate may be given during a fixed-term or a periodic rental agreement.
Mortgagees may also be entitled to give other notices under Part 5 of the Act (s 91ZZK(3)). However, in most cases, the mortgagee will rely upon default of mortgage as the reasons for termination (s 91ZZK).
If the mortgagee applies under the RT Act, if there are any court orders showing the mortgagee’s entitlement to possession and to exercise the right of sale, copies of the orders must be attached to the application. Failure to do so may result in their application being dismissed (s 325) (see Commonwealth Bank of Australia v Shrestha (Residential Tenancies) [2023] VCAT 331 (28 March 2023)).
There has, however, been controversy over whether or not a mortgagee must end an agreement according to the RT Act when they become entitled to possession of the property under the mortgage. In the recent decision of Capital Securities XVI Pty Ltd v Kozina & Anor [2023] VSC 178 (6 April 2023) (‘Capital Securities case’), the court states that a mortgagee may be not obligated to follow the processes set out in the RT Act to regain possession. That is to say, the mortgagee may obtain an order such as a warrant for regaining the property (warrant of possession) or an order for ejectment, (as distinct from a possession order under the RT Act) via the Supreme Court Act 1986 (Vic) (see Supreme Court (General Civil Procedure) Rules 2005 (Vic) ords 66.03, 66.12, 66.16).
This approach is consistent with Supreme Court decisions before 29 March 2021. However, provisions seemingly introduced to protect innocent renters are now exacerbating rather than palliating the harm caused by a potentially quick eviction in response to rental providers’ default. That is, a mortgagee cannot serve a Notice to Vacate if the mortgagee expressly or impliedly consented to the mortgagor entering into a rental agreement in relation to the premises, regardless of when the rental agreement was entered into (RT Act s 91ZZK(1)). While this purports to protect renters by restricting when the notices can be given, the effect of this stricture and the Capital Securities case compels a mortgagee to use the Supreme Court provisions which do not guarantee a 60-day notice period (s 91ZZK), or a postponement of the warrant based on hardship (cf. s 352), or the protection against costs (VCAT Act s 109), or even a guarantee that the renters will be joined as interested and effected parties in a proceeding between the mortgagee (bank) and the mortgagor (rental provider). This is a complex area of law, and the interaction of this new provision has not been extensively tested.
A renter may have a compensation action against their former rental provider for a rental provider breaching the rental agreement; however, a renter cannot prevent the mortgagee from taking possession unless their rental agreement predates the granting of the mortgage. Careful attention should be given to the dates of mortgages (including where a rental provider has remortgaged with a new mortgagee rather than refinanced with the same mortgagee). Many mortgagees will continue to use the RT Act as a more appropriate and accessible process; however, in light of the Capital Securities case, it is important that if a mortgagee contacts a renter, they should seek legal advice immediately.
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A public housing rental provider can give a renter a 90-day Notice to Vacate if the renter no longer meets the public housing eligibility criteria (RT Act s 91ZZE).
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In some circumstances, the following Notices to Vacate have no effect (RT Act s 91ZZI):
the property is to be repaired, renovated, or reconstructed (s 91ZX);
the property is to be demolished (s 91ZY);
the property is to be used as a business (s 91ZZ);
the rental provider, or their dependent family member, is to move in (s 91ZZA);
the property is sold, or is on the market (s 91ZZB);
the property is required for a public purpose (s 91ZZC);
it is the end of a fixed-term agreement (s 91ZZD, 91ZZDA); and
the renter is no longer eligible for public housing (s 91ZZE).
The circumstances in which these notices have no effect are if:
the minimum notice period has not been given;
the termination date in the notice is before the end of the fixed term in the rental agreement; or
giving the notice would constitute direct discrimination (see ‘Discrimination’, above).
Retaliation
If a rental provider gives a renter a Notice to Vacate to coincide with the end of a fixed-term agreement (under section 91ZZD or 91ZZDA of the RT Act) and it has been given in response to, or in retaliation for, the renter’s exercise or proposed exercise of a right under the RT Act – or in response to the renter giving the rental provider written notice under section 72AA of the RT Act that the property requires repairs – the notice has no effect. The renter has 28 days after the day on which a 90-day notice is given to apply to VCAT and challenge the validity of the notice (s 91ZZI(5)). They have 21 days in the case of a 60-day Notice to Vacate (s 91ZZI(5)).
If the renter does not apply to VCAT within the specified time, they can argue that the notice is retaliatory when the rental provider applies to VCAT for possession.
In the case of a Notice to Vacate that is given for threats and intimidation (RT Act s 91ZK), the notice has no effect if it has been given in response to a renter exercising, or trying to exercise, their rights under the RT Act (e.g. requesting repairs).
Strictly speaking, ‘retaliation’ is limited to sections 91ZZD, 91ZZDA and 91ZK of the RT Act. However, if renters believe other notices are used in retaliation, they should place the rental provider on notice of section 91ZZH and monitor the property after termination of the rental agreement.
If a Notice to Vacate has purportedly been in retaliation, evidence of this should be included with evidence about the credibility of the rental provider’s conduct and whether they have acted in good faith. The rental provider will need to satisfy VCAT that they will follow through with the action set out in the Notice to Vacate. It will be a factual matter for VCAT to determine if it is genuinely satisfied that a possession order ought to be given in the circumstances based on the evidence before it.
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A renter can challenge a 60-day Notice to Vacate – except for a notice by a mortgagee or a notice for the end of a fixed-term agreement (see ‘Notices to Vacate that have no effect’, above, for when notices about the end of fixed-term agreements can be challenged) – if they think that it is invalid, including if it has ‘no effect’ (RT Act s 91ZZS(1)).
If a renter wants to challenge a Notice to Vacate before there is a possession order hearing at VCAT, they must apply to VCAT within 30 days of the date that they received the Notice to Vacate. If they do not challenge the notice within 30 days, they can still challenge its validity at the possession order hearing (RT Act s 91ZZS(2)).
Family or personal violence
If a renter has been given a Notice to Vacate for an act or breach that was caused by someone who has subjected the renter to family or personal violence, the renter can apply to VCAT to challenge the notice (RT Act s 91ZZU).
This defence is only available to the following reasons for the Notices to Vacate:
damage (s 91ZI);
danger (s 91ZJ);
threats and intimidation (s 91ZK);
failure to follow a VCAT order (s 91ZO);
breaching a duty after having received two previous breach of duty notices for the same breach (s 91ZP);
using the property for an illegal purpose (s 91ZQ); and
drug-related conduct in public housing (s 91ZR).
If a renter receives a Notice to Vacate and would like to know if they can challenge it, they should contact Tenants Victoria as soon as possible (see ‘Contacts’ at the end of this chapter).
A renter can challenge the Notice to Vacate at, or before, a VCAT possession order hearing. If they want to apply to VCAT to challenge the Notice to Vacate they must do this within 30 days of being given the Notice to Vacate (RT Act s 91ZZU). If the renter has not applied before the possession order hearing, leave might be sought for the renter to make the application.
Safety and seeking support should always be considered if this defence is to be raised.
VCAT must make an order that the Notice to Vacate is invalid if it is satisfied that the renter has been, or is being, subjected to family or personal violence, and the act or breach for which the notice was given was caused by the perpetrator of that violence (RT Act s 91ZZV).
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The RT Act contains specific provisions relating to violence on ‘managed premises’. Managed premises are defined as caravan parks, rooming houses, Part 4A parks, and ‘managed high-density buildings’, which are buildings that contain two or more rented premises and have an onsite manager.
A Notice to Leave is different from a Notice to Vacate. Only a manager of a managed premises may give a Notice to Leave (RT Act s 368). A ‘manager’ includes an onsite manager, rooming house owner, caravan park owner or site owner. An ‘onsite-manager’ is specifically defined as a person whose duties include security, day-to-day operational responsibility, and who is employed to be present, or is available to be present, at least seven hours a day, five days a week (s 367). A manager may give a resident, or a resident’s visitor, a Notice to Leave the premises if they have reasonable grounds to believe that a serious act of violence by the resident has occurred on the premises, or that the safety of any person on the premises is in danger from the resident (s 368(1)).
A Notice to Leave under section 368 of the RT Act must be given as soon as the manager can safely do so after the serious act of violence has occurred (RT Act s 326(4)).
A Notice to Leave must be in the prescribed form (RT Act s 368(3)). A Notice to Leave has immediate effect. The resident or visitor must not remain on the premises after receiving the notice (s 369).
Templates of the Notice to Leave forms are available to download from CAV’s website (www.consumer.vic.gov.au).
A rental agreement or residency right is suspended when the renter is given notice, but the renter must continue to pay rent (RT Act s 370). The suspension remains in force for two full business days after it commences (s 371). It is an offence to re-enter the managed premises during the suspension (s 372).
The manager must tell VCAT’s principal registrar that the Notice to Leave was given regardless of whether they apply to VCAT (RT Act s 373). They must do so no later than the end of the next business day after the day on which the Notice to Leave was given (s 373).
If within these two business days the manager of the premises applies to VCAT for an urgent hearing to terminate the rental agreement, the suspension continues until the matter is determined (RT Act s 371). Any application for an urgent hearing to terminate a rental agreement must be heard within two days of the application being made. VCAT must not adjourn hearing such an application for more than a total of five days (s 375). This means that a renter must seek urgent assistance to defend the Notice to Leave. For this reason, before re-entering the premises, parties should contact VCAT to confirm if any application has been made, and, if so, at what time the application was lodged.
At an urgent hearing, VCAT will determine whether it was appropriate for the rental provider to issue the Notice to Leave. If VCAT deems it was appropriate, VCAT may make a termination order, but only if VCAT is satisfied that it is ‘reasonable and proportionate’ to do so, considering the factors set out in section 330A of the RT Act (s 376(1A). (See ‘Reasonable and proportionate test’, below.)
If the rental provider has not made an application to VCAT within two business days, the notice lapses and the renter can return. The suspension will also cease if VCAT determines that it was not appropriate to give the resident a Notice to Leave (RT Act s 376(1B)). The rental provider must not allow any other person to occupy the premises while the suspension is in force (s 377).
It is an offence to give a Notice to Leave or purported Notice to Leave without reasonable grounds (RT Act s 368A). If reasonable grounds cannot be established, the renter may seek to apply for compensation (s 376). However, careful consideration is required with respect to the evidence that may be given in the proceeding.
Renters who have received, or who anticipate receiving, a Notice to Leave should ensure they are contactable (e.g. they have their mobile phone and charger) and should let any support services they use know how to contact them. As indicated on the notice, an excluded person should contact VCAT to determine whether an application has been made and what the anticipated hearing date is. If the renter relies on any health care aids or medications, it is permissible for the renter to negotiate with the rental provider to send an authorised third party on their behalf to collect these (RT Act s 372A).
Family or personal violence
A manager must not give a resident a Notice to Leave:
if the serious act of violence or the act that endangered the safety of a person is family violence; or
if the resident’s visitor is a family member of the resident (RT Act s 368(5)).
Ending a tenancy: Rental provider wants renter to leave
Chapter: 6.1: Tenancy
Contributor: Ben Cording, Lawyer, Tenants Victoria
Current as of: 1 September 2024
Law Handbook Page: 445
Next Section: Procedure for ending a rental agreement
