Tenancy troubles
13/09/2005 The Star Articles of Law with Bhag Singh
A person has a house in Malaysia but spends several years working abroad.
During this time the house is rented out to a family introduced by a
neighbour. The tenant banks the rent into the landlord’s bank account. All
seems well.
The person appears to be friendly and nice. So the landlord is comforted.
The tenant is told that he will be responsible for minor repairs but
anything major will be paid by the landlord. The landlord tells the tenant
that he could deduct any payment made for repair against the rental.
A tenancy agreement was prepared and signed and left with the tenant for him
to stamp. Now more than a year later the landlord finds that recently the
rent was not banked into the landlord’s account and the tenant claims to
have deducted amounts purportedly for repair which are unacceptable to the
landlord.
The tenant has decided to leave and it is discovered that some parts of the
house have been damaged and some items such as air conditioners are missing.
The landlord does not know what to do because some friends have advised him
to lodge a police report while others have told him to sue the tenant while
some have told him that since the tenancy agreement has not been stamped it
is null and void!
Essentially it is a transaction between two parties on terms mutually
agreed. What has happened is that one of the parties has breached the
agreement. So it is broadly a question of breach of contract or rather the
tenancy agreement.
Lodging a police report is not likely to produce any immediate results. Very
often a person faced with a problem is inclined to react by lodging a police
report in the hope that the act of doing so will either frighten the other
party to respond to one’s claim or the police will act to help the
complainant.
Both expectations are in most cases not to be met because adversaries in
commercial disputes are unlikely to be frightened by the lodging of police
reports. On the other hand the police are unlikely to act on such reports
unless a crime is committed.
This is because a police report is to initiate the commencement of
investigations to ascertain whether an offence has been committed. It is in
fact a prerequisite before investigations will commence. However if no
offence is disclosed, then the question of commencing investigations does
not even arise.
In this case what is involved is not what would generally be regarded as an
offence but merely a breach of terms in that the tenant has failed to fulfil
his obligations.
Apart from not paying rent it appears that the tenant has been responsible
for some damage to the property and an air conditioner and other equipment
have gone missing. But it is not known if the items were stolen or removed
by the tenant.
Of course if it is known that they were stolen, then there is the element of
an offence being committed. However given the overall nature of the
transaction the authorities are more likely to view it as a private
transaction and they would not interfere.
This being the case, the remedy for the landlord lies in pursuing a civil
remedy. This would be on the basis of the agreement entered into and the
non-fulfilment of obligations.
As the tenant has now vacated the premises the landlord’s only option is to
sue the former tenant to recover the unpaid rental and expenses incurred for
repairs.
The fact that the Tenancy Agreement has not been stamped does not make the
arrangement null and void. It does not mean that rent in arrears cannot be
recovered or that the tenant would not be liable to compensate the landlord
for the damage caused.
Even if there was no formal Tenancy Agreement the landlord would be able to
recover the rental and any damage caused to the premises.
An area of dispute that is likely to emerge is the extent of the repairs
that the tenant is liable for. The words used in agreement are not really
helpful because parties will disagree on what is meant by minor and major.
This is where a properly worded tenancy agreement could play a useful role
by stating precisely the kinds of repairs that the tenant would be
responsible for.
This objective could be even better achieved if this aspect was
particularised in as much detail as possible. The more specific the
provisions the less the scope for any disagreement.
In the absence of specific agreement the position would be that the tenant
would be responsible for ordinary expenses incurred by the need to maintain
the premises as handed over but not be responsible for any structural
defects in the premises.
Of course the landlord would be entitled to make a claim against the tenant
on the basis of the obligations discussed. However the mechanics of doing so
and the implications of being involved in different tribunals would be
another matter.
Given the scenario it is unlikely that the tenant will pay anything unless
he is taken to court. This of course involves litigation which many people
would rather avoid. Time constraints, effort and costs have to be
considered.
