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Breaking a lease

Often under duress a tenant may need to break their tenancy agreement, or lease, under the excessive hardship rules, but they should to be aware of their legal responsibilities and the prospect of costs being awarded to re-let the property.

A lease is a legally binding written contract between the tenant and property manager/owner and the easiest way to break a lease is by a written termination agreement signed by both the tenant and the property manager/owner.

If the property manager/owner refuses to break the lease the tenant has these options.

In the case of excessive hardship, a tenant can make an urgent application directly to Queensland Civil and Administrative Tribunal (QCAT), without participating in RTA dispute resolution, to end the tenancy agreement.

The legislation does not define "excessive hardship" as this is dependent on individual circumstances and must be ruled on by an adjudicator at QCAT.

Some examples of excessive hardship may include the loss of a job and no means to pay rent, a tenant who is forced to relocate for work or is suffering severe physical or mental illness.

The tenant should attend the QCAT hearing with the necessary documents to support their claim of excessive hardship.

If excessive hardship is proven QCAT can grant a termination order of the tenancy agreement immediately.

But the tribunal cannot backdate the termination order and the tenant would be responsible for the rent and associated costs up to the termination date.

But if excessive hardship cannot be proven the tenant may be responsible for compensating the property manager/owner for any loss or expense for re-letting the property which may include:
  • payment of rent until another tenant is found
  • repairs
  • cleaning
  • break lease fees, such as real estate agents’ administration fees
  • advertising expenses to relet the property.

However, the property manager/owner has a legal obligation to reduce or minimise costs that result from the lease break. That is, the property manager/owner must make a reasonable effort to re-let the premises quickly.

If there is a dispute between the tenant and property manager/owner about the amount of compensation, an attempt to conciliate the issue must first be made with the RTA.

If the issue is not resolved, the RTA will issue a Notice of unresolved dispute. The matter can then be taken to QCAT for a decision.

If an owner wants to end a fixed term agreement on the grounds of excessive hardship e.g. lost job and unable to pay mortgage, they may also apply to QCAT for a decision.

In this case the tenant may seek compensation e.g. an amount towards moving costs.