In the shadows of the Residential Tenancies Act

Not all renters are treated equally under NSW tenancy laws. There are many tenants in fairly conventional renting situations who would be surprised to learn that NSW state tenancy laws don’t apply to them.

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Renters in share houses, for example, will find themselves excluded from the protections of the Residential Tenancies Act if their rental agreement, with the head-tenant they live with, isn’t in writing. No other group of renters requires a written agreement as a precursor to protection under the state’s tenancy laws.

The provision that allows for this exclusion, section 10, is a particularly pernicious provision.

It’s not nice to rent in the shadows of the Residential Tenancies Act. These renters, many of whom are young people, international students, and people on low incomes, are exposed to immediate evictions, spur-of-the-moment rent increases, and a legal imbroglio if their head-tenant refuses to return their bond.

Karen’s Story

Karen responded to a listing on Gumtree for a room in a three-bedroom house in Sydney’s Inner West. Karen went to inspect the house and was shown around by the landlord, Christopher.

During her inspection, Karen observed tools and building materials lying around the house and a large hole in the upper wall and ceiling of the dining room. Christopher explained that he was doing renovations on the property, but told Karen he would be finished before the new tenant moved in.

Karen was impressed by the property’s rooftop terrace and was told by Christopher that this was communal space shared by all tenants.

Karen agreed to take the room and paid him $1840 as a bond and two weeks rent in advance.

Two days before she was to move in, Karen paid a quick visit to the house. She was surprised to see that the major renovations were still being carried out. Karen also discovered that Chris had previously promised the rooftop terrace and entire upstairs area to another tenant for their own exclusive use.

Karen sought an explanation from Chris and tried to renegotiate the rent on her bedroom, which Chris refused. Karen asked Chris for her advanced rent and bond back. Chris refused to return any money and Karen was forced to stay in backpacker accommodation and put her furniture into storage until she found a new place to live.

Thinking she was a tenant and that tenancy laws applied, Karen lodged an application with the NSW Civil and Administrative Tribunal to get her money back from Chris. The Tribunal found that Karen’s lack of a written agreement with Chris excluded her from the protection of tenancy laws under section 10 of the Residential Tenancies Act. Her application was dismissed.

Redfern Legal Centre assisted Karen to bring a misleading and deceptive conduct claim against Chris in the same Tribunal, this time under the Australian Consumer Law (ACL). Under this claim, Karen faced the difficult task of showing that Chris was running a business of renting out rooms.

Fortunately, Karen was successful in her claim and, 8 months and a garnishee order later, all of her money was returned to her plus damages for her extra storage and accommodation expenses.

Karen was lucky because consumer laws covered her situation but these laws don’t cover all renters in situations similar to Karen’s. Redfern Legal Centre advises renters on an almost daily basis that they have no easy recourse to resolve their legal dispute because they are excluded from the Residential Tenancies Act under section 10.