Guide to Taking a Rent Arrears Case to VCAT

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1 Guide to Taking a Rent Arrears Case to VCAT CEHL June 2010

2 -2- Guide to Taking a Rent Arrears Case to VCAT INTRODUCTION CERCS are required to exercise their rights and obligations as a landlord, and it is expected that all CERCs are able to effectively manage rent arrears. This guide aims to assist CERCs needing to proceed with VCAT action in the case of rental arrears, and is designed to inform most decisions and issues likely to present. To ensure consistency and fairness, CERCS should have a clear policy and procedures regarding rent arrears, and VCAT action should only be implemented in accordance with that policy. As well, it is important to note here that VCAT action should only be taken after the tenant has been given an opportunity to resolve the situation by negotiating a catch up agreement and sticking to it. If in doubt, please contact Common Equity Housing for clarification. Your Co- Op Support Coordinator is available upon request to provide the CERC with assistance and advice, and to attend any scheduled VCAT hearing.

3 -3- Table of Contents Explanation of Legal Terms 4 Filling in the Paperwork Rent Arrears 6 Notice to Vacate 7 Calculating Rent Owed for Notice to Vacate 8 Application by a Landlord to VCAT 9 Sending off the Papers To the Tenant To the Tribunal 11 Applying for an Adjournment 11 Withdrawing a Case 12 Preparing for your day at the Tribunal Keep a file with all information relevant to the Hearing Summary of Proofs 12 Calculating Rent 13 Your Day at the Tribunal Arriving Going into the Hearing Room Etiquette - How to act at the Tribunal 17 Enforcing an Order for Possession 19 Negotiating a Catch Up Agreement 19 Applying for a Renewal of Proceedings 20 Fax - Requesting Renewal of Proceedings 20 Tenant has left the Property Owing Rent 21 Applying Online (Optional) 22 To Register 22 Creating a Notice to Vacate 22 Lodging an Application Online 22 Important Contact Numbers 22 Important Contact Numbers 23 Appendix 1 24

4 -4- Explanation of Legal Terms Rental Arrears When a rental account is not in advance. VCAT action can only be started if the tenant owes 14 days or more rent is owed to the CERC. Termination Date Date on Notice to Vacate on which tenant is asked to leave the property. Notice to Vacate Form sent to tenant requesting they leave the property within a certain period of time. Fixed Term Tenancy A tenancy for a specific period such as 12 months or two years. The maximum length of a fixed-term tenancy is five years. Periodic Tenancy Where there is no written tenancy agreement, or a tenancy with no end date inserted. Adjournment Delaying the full Hearing until a later date. Applicant The person who applies to the Tribunal, generally the CERC. Respondent The person who responds or answers to the Tribunal, generally the tenant. Referee The person who makes the decision at the Residential Tenancies Tribunal Hearing. Determination Decision made by the Tribunal. This can be in the form of an Order (see below), or where a case is dismissed through lack of evidence or due to insufficient notice given. Order The decision that the Tribunal orders. This is normally available for collection after the Hearing, or will be sent in writing to the CERC and the tenant at a later date.

5 -5- Consent order Where both the tenant and landlord have agreed on a way to repay arrears (e.g. Catch up Agreement) over a period time, the Tribunal can include the terms of this agreement in the Order. Possession Order An order that the tenant must vacate and return the property to the landlord. Also known as Vacant Possession. Prescribed Form Form provided by Consumer Affairs which must be used, such as Notice to Vacate. VCAT Victorian Civil and Administrative Tribunal RTL Residential Tenancies List still sometimes referred to as the Residential Tenancies Tribunal a division within VCAT that hears cases about residential tenancies. Warrant A CERC that obtains Vacant Possession may then apply for a Warrant of Possession. This must be executed by the Police. Application for Review If the respondent or applicant was unable to attend the original hearing for a reason such as transport problems or late receipt of notice of Hearing, they can apply for a review of proceedings. If this is granted, the matter is heard again with all parties present. Renewal of Proceedings Where a Consent Order (see above) is granted and the tenant breaches the conditions of the order, the landlord can apply for a Renewal of Proceedings. This reopens the first Hearing the application for a Possession Order. The whole file should be brought to the new hearing along with evidence of the breach of the Consent Order, such as the rent card.

6 -6- Filling in the Paperwork Rent Arrears Check the tenant is at least 14 days in arrears 1. Fill in Notice to Vacate to Tenant(s) of Rented Premises You must use this form as it is prescribed. The inside cover of this notice gives you the exact wording you need for different situations. For Rent Arrears, use the wording on the inside cover of the notice for s246(i). Contact Consumer Affairs Victoria or CEHL to request Notice to Vacate forms. The form comes in triplicate: One copy for VCAT; One copy for the landlord (i.e. the CERC); The Original for the tenant Always send the tenant copy registered post and keep the registered mail receipt as proof of service.

7 -7- Notice to Vacate Name of tenant(s) on Tenancy Agreement Tenant s Name Tenant s Address As Above s246(i) - Overdue rent. You owe at least 14 days rent. Your rent is paid up to and including./../. You owe $ as of././. See the inside cover...of.the Notice form for the exact wording. Always send registered post and keep the Registered Mail Receipt. Date Notice is sent. Name of CERC Ltd. Signature of CERC Member CERC s address Name of CERC Member who signed above 14 Termination date should be about 20 days from the day Notice is sent to the tenant.

8 -8- Calculating Rent Owed for Notice to Vacate Example One Weekly rent is $180 Rent card shows amount owing till fortnight ending 15 th December is $ Date Notice to Vacate (NTV) sent is 9 th December To determine date rent is paid up to: a) calculate daily rent: $180 7 = $25.71 daily rent; b) calculate amount owing at date of NTV: 9 th to 15 th December => 6 days; c) 6 days x $25.71 = $154.26; d) $ $ = $ owing as of 9 th December (date NTV is sent); e) calculate number of days owing: $ $25.71 = days; f) round up to whole days = 34 days; g) count back 34 days from 9 th December => 5 th November. Therefore, rent is paid up to the 5 th November.

9 -9-2. Fill in Application by a Landlord to the Victorian Civil and Administrative Tribunal. You must not send this notice until the tenant has received the Notice to Vacate or the case will automatically be dismissed. Insert CERC s name. Remember to follow by Ltd. Name of CERC Ltd Can be left blank Name of CERC member representing the CERC Name of CERC representative Not applicable to CERCs Name of tenant(s) on Tenancy Agreement. Tenant s Name Attach copies of Notice to Vacate sent to tenant and any other relevant documents e.g. Rent Card, or previous Catch Up Agreement CERC house or last known address R/ Number from previous hearing if applicable. Generally Possession Order due rent arrears in excess of 14 days or Compensation for Rent Arrears (if tenant has already left property) Signature of CERC Member Should be 7 days after the Notice to Vacate was sent to the tenant unless arrears have been paid. Send copy of Application to tenant by registered post; copy to Tribunal can be sent by ordinary mail

10 -10- Sending off the Papers 1. To the Tenant a) It is essential the tenant receives the Notice to Vacate at least 14 days before the termination date on the Notice. If this does not occur any Tribunal hearing will be dismissed. b) The Notice to Vacate should be served by registered mail. c) When sending this notice by registered mail, you must take into account the extra days it takes for the tenant to receive it. This usually means about 4 days after the Notice was posted. Refer Appendix 1. The registered mail receipt must be kept as evidence for any Tribunal hearing that may occur. The receipt is taken as proof that the Notice to Vacate was received by the tenant(s) even if it wasn't picked up from the post office. If the tenant pays the full arrears, or makes a partial payment and is less than 14 days in arrears before the Notice to Vacate is deemed to be served, there is no ground to proceed with further action and the case must be dropped. d) 7 business days after the Notice to Vacate is posted, send the tenant the Respondent's (green) copy of the Application by a Landlord to the Victorian Civil and Administrative Tribunal (available from VCAT or CEHL) by registered mail and keep the receipt. e) Keep the YELLOW copy of the Application form and a Landlord's copy of Notice to Vacate for the CERC. You will need them for any Tribunal hearing or if you need to withdraw the matter. If the tenant has already vacated or abandoned the property, refer page 21.

11 To the Tribunal a) 7 business days after the Notice to Vacate is posted, send the Original (white) copy of the Application by a Landlord to the Victorian Civil and Administrative Tribunal and a Landlord's copy of the Notice to Vacate to: The Principal Register Residential Tenancies List VCAT GPO Box 5408CC Melbourne Vic3001 b) Enclose a Bank Cheque or Money Order - personal cheques are not accepted. Refer to CEHL or for list of current fees. c) The paperwork to the Tribunal can be sent by ordinary post. There is no need for it to be sent by registered post. d) You will get a Notice of Hearing telling you when and where the Hearing will be held. This can take up to 3 weeks. e) If you require assistance, call CEHL, with the date of Hearing and confirm CERC Support Coordinator availability. Applying for an Adjournment If arrears are paid in full, or the tenant makes a partial payment and is less than 14 days in arrears before the date of the Hearing, the CERC can request an adjournment for 3 months. This must be done a) at least 24 hours before the time of the Hearing, using the prescribed form (contact CEHL or refer or b) by attending the Hearing and asking the Referee for an adjournment. You must notify the tenant if you intend to apply for an adjournment (or send them a copy of the request).

12 -12- Withdrawing a Case If arrears are paid in full before the date of the Hearing, you may wish to withdraw the case. This is done by using the withdrawal form on the back of your copy of the Application to VCAT (yellow copy). Send or fax this original to: The Principal Registrar Residential Tenancies List VCAT GPO Box 5408CC Melbourne Vic 3001 Fax: (03) A copy must also be sent to the tenant. Preparing for your day at the Tribunal 1. Keep a file with all information relevant to the Hearing. This will include: a) Tenancy Agreement b) Summary of Proofs (complete as much information as possible) c) Rental history covering the period of arrears d) Catch Up Agreement(s) e) Copies of Notice to Vacate f) Copy of Application by a Landlord to the Victorian Civil and Administrative Tribunal g) Registered Mail receipt(s) h) Previous Tribunal order or reference numbers. Any correspondence relevant to the rent arrears. i) Up to date rent card (as of day of Hearing) j) Any other relevant documentation or evidence such as photos, statutory declarations etc. 2. Summary of Proofs Form A Summary of Proofs form is available for download from or available from the Tribunal upon request.

13 -13- The Tribunal relies on the information contained in the Summary of Proofs to make its decision. Filling in the Summary of Proofs is a good way of checking your information and appearing professional. Fill in 2 copies of the Summary of Proofs form one for the Referee, and a copy for yourself. The Summary of Proofs form covers most of the information required on the day of the hearing. Completing the Summary of Proofs Form 1) Enter the tenancy commencement date. State whether the tenancy agreement is for a fixed term or a periodic tenancy; and whether the tenant remains in possession or has abandoned or vacated the rented premises. 2) Insert details of how the Notice to Vacate was served, including the registered post number. 3) Provide details of service of the Application to VCAT to the tenant. 4) Give details of the rent payable under the tenancy agreement. State the date to which rent was paid at the time the Notice to Vacate was given. Then state the date to which rent is paid as at the date of hearing (or the date of abandonment or vacation if applicable). 5) Finally, calculate rent owed to the date of hearing, or alternatively to the date the tenant abandoned or vacated the rented premises. Calculating Rent Example One: Weekly rent is $180 Rent card shows amount owing till fortnight ending 5 th January is $ VCAT Hearing date is 7 th January; To determine date rent is paid up to as at date of Hearing (for Summary of Proofs): a) calculate daily rent: $180 7 = $25.71 daily rent; b) calculate amount owing at date of Hearing: 5 th to 7 th January=> 2 days; c) 2 days x $25.71 = $51.42 d) $ $51.42 = $ owing as of 7 th January (date of Hearing);

14 -14- e) calculate number of days owing: $ $25.71 = days; f) round up to whole days => 70 days; g) count back 70 days from 7 th January => 30 th October. Any rent paid on account must be included in the calculations. On account represents a partial payment on a day; that is, the tenant hasn t paid a full day s rent, but has paid part of it. To calculate rent on account: a) 70 days x $25.71 daily rent = $ b) $ $ = $9.69 on account Therefore tenant owes $ , with $9.69 on account. Therefore, the tenant owes 70 days rent ($ ) less the amount they have partially paid on one day ($9.69). So you are actually seeking $ If the tenant has not paid anything since the Notice to Vacate was issued, the Summary of Proofs should claim this amount. Example Two: Same scenario only tenant has paid $200 since the Notice to Vacate was sent. $ $200 = $ owing at the date of the Hearing. To calculate how many days the tenant owes: a) $ = days b) round up to whole days => 62 days c) count back 62 days from 7 th January => 5 th November. To calculate rent on account: 62 x $25.71 daily rent = $ $ $ = $4.01 on account. Therefore, the tenant owes 62 days rent ($ ) less the amount they have partially paid on one day ($4.01). So you are actually seeking $ , and the Summary of Proofs should claim this amount

15 -15- The CERC is responsible for completing as much of the information on the Summary of Proofs as possible including tenancy details and rent payable. If you are unsure on how to complete the Summary of Proofs form, contact CEHL for assistance. If there is a mistake with your calculations, or they are different to the VCAT Referee s, he or she will tell you. The difference should be small, so accept the Referee s calculations.

16 -16- Tenant still in possession of property Summary of Proofs Form re Tenant has left property R/number from Notice of Hearing sent by the Tribunal to the CERC Date in box 10 of Notice to Vacate Periodic applies where there is: a) no written tenancy agreement; or b) a tenancy agreement with no end-date inserted. Date in box 8 of Notice to Vacate Date in box 14 VCAT Application Date on registered mail receipt Calculate rent per week Total rent owed at date of Hearing. CERC member appearing at Hearing. X

17 -17- Your Day at the Tribunal 1. Arriving a) Make sure to take all relevant information particularly the Summary of Proofs. Also take a calculator, a calendar, some paper and a pen. b) Arrive at least 15 minutes before your hearing time and find out where the hearing room is. c) Let the clerk know you have arrived. Take your Notice of Hearing with you. d) Wait until you are called. 2. Going into the Hearing Room a) If called in with other cases, you will sit at the back and wait until your case is called. b) Normally the person who makes the application, or the applicant (usually the CERC), sits to the right and the respondent, or the tenant, sits to the left. It is polite to remain standing behind the chair until the Referee asks you to be seated. Referee TENANT Respondent CERC Applicant 3. Etiquette - How to act at the Tribunal a) It is polite to refer to the referee as either Sir or Madam. b) It is polite to refer to the tenant as Mr., Miss, or Ms etc. c) It is polite to dress neatly. d) Do not take food or drink into the hearing room, ad remember to turn off your mobile phone

18 Taking the Oath or Swearing an Affirmation Before hearing the matter, the Referee will ask everyone giving evidence to swear an Oath on the Bible or an Affirmation. You may choose either to take the Oath or Affirmation. You either repeat after the Referee or read off a sheet normally placed in the Bible. You will also be asked your full name, address and occupation. OATH I swear by Almighty God that the evidence I will give in this case, will be the Truth, the Whole Truth and nothing but the Truth. AFFIRMATION I (name) do solemnly and sincerely declare that the evidence I will give in this case will be the Truth, the Whole Truth and nothing but the Truth. 5. Deciding Your Case a) When the Referee has heard all the evidence, they will hand down a determination or decision. b) If you do not understand the decision, ask the Referee to explain it. 6. Asking for a Certified Copy of the Order a) In case the CERC may have to chase-up the debt, it is always a good idea to ask the Referee for a Certified Copy of the Order. This is free and is the first requirement in most situations where you are trying to recover money owed to the CERC by the tenant. b) Thank the Referee and leave the Hearing room. c) Usually, a copy of the Tribunal's decision or Order will be available for collection on the day. Otherwise, a copy will be posted to you and the tenant. This normally takes about 3 weeks.

19 -19- Be well prepared, reasonable and stick to facts, dates and amounts not opinions. Know the next rent day for your Tenant - this is often asked. If you want written reasons for a decision, ask for them at the beginning of the Hearing. Written reasons are only provided on request. Enforcing an Order for Possession If an Order of Possession is awarded, the CERC may need to purchase a Warrant from VCAT to enforce the Order. There is a fee for this. VCAT will fax the Warrant to the nearest Police Station. The CERC may wish to contact the Police to arrange a time for the eviction and to have a locksmith attend to change locks. The Police will usually contact the tenant to advise when the eviction will take place and escort them from the premises if necessary. Note: the CERC does not have to purchase the Warrant straight away the Order of Possession is valid for a period of up to 6 months. Once the Warrant is purchased, it must be enforced by the Police within 14 days. If you purchase a Warrant and then do not use it, the whole case collapses and you will have to start again if you wish to seek possession. While VCAT does have the power to suspend or cancel a Warrant, this is unusual and not recommended. Negotiating a Catch Up Agreement Sometimes you may reach a Catch-Up Agreement with the tenant before going to the Tribunal. In this case you can apply for a delay or adjournment in hearing the case. To do this: a) Go to the Hearing, explain you have reached an agreement and ask for the agreement to become a Consent Order from the Tribunal. Take a copy of the Catch-Up Agreement signed by the CERC and the tenant. Fill in the Summary of Proofs form as this information will be needed. b) Then ask for an adjournment. This means the case will not be heard immediately and the tenant will have a chance to pay off the arrears in

20 -20- keeping with the agreement. Most adjournments are for the period of the Catch-Up Agreement. c) If at any time within the adjournment period, the tenant breaks the agreement, you restart the process by contacting the Tribunal by fax or letter, stating the case reference number and requesting an urgent Renewal of Proceedings. There is no further charge for this Hearing. Usually your case will be listed fairly quickly. The fax number for urgent Hearings is (03) If the arrears have been paid in full during the adjournment period, the application will automatically lapse at the end of the period. Neither the tenant nor the CERC have the power to change a VCAT Order, meaning that a Catch Up Agreement that becomes a Consent Order from the Tribunal cannot be renegotiated. Applying for a Renewal of Proceedings Urgent hearings can be requested where, for example, a tenant has broken a Consent Order from the Tribunal. Put the request in writing, quoting the reference number, and fax to: If a tenant breaks an Order of the Tribunal, it is not necessary to serve another Notice to Vacate. Fax - Requesting Renewal of Proceedings The Principal Registrar Fax to: Dear Sir or Madam, Re: Renewal Request (insert reference number) We request a renewal of proceedings as the tenant has breached the VCAT Order issued (insert date). Yours sincerely, CERC Member

21 -21- Tenant has left the Property owing Rent You can still ask the tenant for compensation for rent arrears even after he/she has left the property. Send the white Application by a Landlord to VCAT and to the tenant's current or last known address by registered mail. It is not necessary to serve a Notice to Vacate. You should make every effort to make sure the ex-tenant receives the Application if you know where they have moved to, send the Application there. If you receive an Order without them attending the Hearing, they can request a re-hearing. Insert CERC s name followed by Ltd Name of CERC Member representing CERC r Name of CERC Ltd Name of CERC representative Name of CERC representative Registered address of CERC or where you prefer the Tribunal to send Notice of Hearing Insert tenant s last known address, if tenant has left and not provided a forwarding address. CERC address is probably the last known address. Tenant s Name X For rent arrears you may attach a copy of any notices sent. Compensation for rent arrears X Send copy of Application to tenant by registered post; copy to Tribunal can be sent by ordinary mail

22 -22- Applying Online (Optional) Website Address: To Register a) Fill in registration document. b) Direct Debit Request - banking details needed. Fees will be charged for any VCAT actions taken, and a monthly statement issued c) Agreement - terms and conditions for use of on-line facility. Creating a Notice to Vacate a) Fill in details and download / send b) VCAT automatically saves the Notice, which becomes part of court file if an Application is made later. c) Notice saved for about 4 months d) Given individual notice number Lodging an Application Online a) Quote individual notice number b) Auto-scheduling for hearing date, time and venue in real time. c) Fee (assumes registered user) - secured telephone link used.

23 -23- Important Contact Numbers 1. General Enquiry Line about Residential Tenancy matters : Phone: (03) Freecall: The fax number when requesting an urgent hearing or advising of the withdrawal of a case from the Tribunal is (03) A phone advisory service for tenants is provided by the Tenants Union of Victoria. Monday, Tuesday, Thursday, Friday, 9:00-4:00 and Wed 4:30-8:00 pm. Phone: (03) CEHL: Phone: (03) Freecall:

24 -24- Appendix 1 Residential Tenancies The following table shows the total number of days to be allowed where the document is sent by registered post. Minimum notice period None (e.g. S.243(1), RTA 1997 Posted on Monday Tuesday Wednesday Thursday Friday Saturday days days days days days days Taken from "Renting a home - A guide for tenants and landlords", Consumer Affairs Victoria, January 2005 IMPORTANT: Public holidays occurring during the postal period must be taken into account. Weekends and public holidays do not affect the minimum notice periods or termination date..

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