Urgent legislation has been introduced in WA to provide further support for commercial and residential tenants and landlords experiencing rental distress due to the current COVID-19 crisis.
Commercial Tenancies (COVID-19 Response) Bill 2020
The Commercial Tenancies (COVID-19 Response) Bill 2020 was passed by State Parliament on 17 April 2020 and introduces the following:
- a moratorium on evictions for six months for small commercial tenancies;
- a code of conduct for landlords and tenants.
Both of these measures are focused on encouraging lessees and landlords to work cooperatively to come up with arrangements that enable both parties to get through the crisis. It is recommended that the landlords and their managing agents work closely with lessees to establish affordable payment arrangements or suitably varied terms of a Lease.
According to Premier Mark McGowan: “tenants in financial distress due to COVID-19 should contact their landlord or property manager to try and make an arrangement. This could include a reduction to the amount paid for a period of time, for example”.
Default and breach notices should continue to be issued, particularly in circumstances where the lessee is belligerent or failing to communicate however, up-to-date advice should be sought on the ability to terminate at the expiration of any default notice.
Residential Tenancies (COVID-19 Response) Bill 2020
The Residential Tenancies (COVID-19 Response) Bill 2020, which was recently passed by State Parliament, introduces the following:
- a moratorium on eviction for six months except in limited circumstances;
- a prohibition on rent increases during the emergency period;
- that any fixed term tenancy agreement due to expire during the emergency period will continue as a periodic agreement;
- relieving lessors of the obligation to conduct ordinary repairs if the reason they cannot do so is COVID-19 related financial hardship or a lawful restriction on movement; and
- enabling a tenant to end a fixed term tenancy prior to its end date without incurring break lease fees (however a tenant will still be liable for damage and rent arrears).
Some of the circumstances in which the six-month moratorium on evictions will not apply to a residential tenant include where the tenant is causing serious damage to the property, the landlord or tenant is experiencing undue hardship, a tenant is experiencing family violence and the perpetrator needs to be evicted, the tenant abandons the premises or the agreement is frustrated.
If you have any questions relating to these new laws, or leases more generally, please do not hesitate to contact Pragma Lawyers on (08) 6188 3340 or aaron@pragma.law.
