Article By: Marissa Kinred, Lawyer Cappello Rowe Lawyers Sydney

Recent changes to legislation responding to the COVID-19 crisis means that Tenants of households impacted by COVID-19 cannot be evicted for rent arrears for a period of 60 days. There are further restrictions on evictions for a six month period. The details are explained below;

What is an “impacted” household

Households are impacted if:-

1. One or more rent-paying member of the household has lost employment or income (or had their work hours or income reduced) due to COVID-19 business closure or stand-downs; OR
2. One or more rent-payment member of the household had to stop working or substantially reduce work hours due to illness with COVID-19 or to care for a household or family member with COVID-19 AND
3. the above has resulted in a reduction of the household income (including government assistance) of at least 25%.

A rent paying member of the household is any member of the household who regularly contributes towards the rent payable under the tenancy agreement

Who is an “impacted tenant”

Any tenant who is a member of a household impacted by COVID-19 pandemic is an impacted tenant.

The first 60 days

Landlords wanting to terminate an agreement for rent arrears are prevented from giving a termination notice or seeking an order for eviction for 60 days from 15 April, 2020 where their tenant is an ‘impacted tenant’.

Rent during the 60 days period

Although you cannot be evicted during this period, rent arrears will still accumulate and will still be payable unless it is negotiated that it will not be paid or will be reduced.

Six Month Restrictions

Landlords are further restricted for 6 months from 15 April, 2020, from giving impacted tenants notices to terminate or from seeking NCAT eviction orders for rent arrears unless the Landlord has participated in good faith in the formal rent negotiations process provided by NSW Fair Trading Dispute Resolutions Service. This may involve the parties entering into an agreement for rent to be waived or reduced or include a repayment plan.

The final decision as to whether an eviction order can be given lies with NCAT who may have regard to (but is not limited by) the following matters when making a determination:-

• any advice provided by NSW Fair Trading to the parties during formal rent negotiations including whether either party refused to give a reasonable offer about rent;
• whether the tenant has continued to make payments towards rent;
• the nature of the financial hardship either party is experiencing including their financial position;
• the availability or affordability of reasonable alternate accommodation for the impacted tenant;
• any special vulnerability of the impacted tenant;
• public health objectives such as ensuring citizens remain at home and preventing avoidable movements of persons.

Termination dates for particular termination notices given during moratorium period now to be at least 90 days

If a tenant is not impacted by COVID-19, there is no change to the process of termination of the tenancy for non-payment of rent and charges.

However, at least 90 days notice is now required to be given if you wish to terminate the tenancy because of the following reasons:-

• the fixed term is ending
• you are ending a periodic agreement
• there is breach other than for rent arrears; or
• the tenant has not complied with a rectification order.

If you are a landlord or tenant impacted by COVID-19 and have questions or need advice regarding a residential tenancy contact our Property Team at Cappello Rowe Lawyers on 6962 3433 or via email at info@cappellorowe.com.au