Delinquent tenants? 1 mistake could cost you weeks of rent
When your tenant is behind on rent, every day counts.
But here’s the catch: one wrong move when accepting a partial payment can wipe out your legal advantage and force you to start the eviction process all over again. We’ve seen it happen — and it’s expensive.
In this short video, we explain
How to protect your rights while still securing funds
The simple step that keeps your legal position airtight
If you have a question or need help, reach out
VIDEO TRANSCRIPT
Ross Millen:
Hi. We've had some landlords lately that have had their tenants not paying the rent, and they've asked us what to do. Well, naturally, we prepare a notice under the Property Law Act, notice of default, telling them that they've got 14 days to cure their default, or else the landlord can exercise rights like re-entering the property, et cetera.
But what do you do when the tenant makes a part payment of rent? Does the landlord take that, or does the landlord have to hold it somewhere? Now, our advice is that there's always a risk of accepting less money than you're actually owed. So if the tenant sort of says, "Well, I owe you 10,000, but I'll pay you 5,000 today and 5,000 next week, is that okay?" If you take the 5,000, then you've probably waived your rights under the notice, and if you don't get the second lot of 5,000, you'll have to give a second notice.
So you need to be careful that you don't do anything that compromises the first notice, or else you've got to start the 14-day process again. So what we say is you can take the first amount, but hold it in sort of a trust account like our trust account or a suspense account, or contact us and we can write a letter for you or an email for you telling the tenant that you're accepting that 5,000 without prejudice to your rights under the notice.
So remember, if you're giving a notice to your tenant, get us to do it because we'll make sure it's legally correct. And also, don't do anything to waive the notice or else you'll have to start all over again. So if you've got any questions about collecting rent from your delinquent tenants, don't hesitate to contact me or anyone else at the Millens team.
