If a lease expires and the landlord agrees to the tenant staying on without signing a new lease, either party (landlord or tenant) is by law entitled to give just one month’s notice of lease cancellation from then on. It is, however, advisable to sign a new lease because under the CPA, the tenant has the right to cancel the lease at any time subject to giving 20 business days’ written notice. This does not apply to certain juristic parties, but be warned, if the cancellation right is exercised, the CPA also stipulates that the landlord is entitled to a ‘reasonable’ cancellation fee and this could be as high as three months rental. However, if the tenant is replaced quickly, the cancellation would in most cases be far lower.
The landlord’s “preparation” responsibilities are limited. It is not widely appreciated that the landlord, in terms of the act, is not responsible for ensuring that every aspect of the home is in apple pie order: he has to see that it is ‘habitable’, which is generally translated into that it is reasonably clean and that equipment is working. The Landlord is not, for example, expected prior to the tenant’s arrival to have all the carpets and curtains dry-cleaned or to have all stains on the walls and floors removed.
The lease agreement (and alterations to it) does not always have to be in writing, however it is preferable when all conditions are spelt out in writing as it helps to be able to refer to written points – but a lease agreement is one of the few cases in property law where a verbal agreement, if it can be substantiated, is in fact binding.
It should also be clearly understood that the Rental Housing Act gives landlords ample power over tenants who default on their rental payments. Among the public, it is now a common misconception that the CPA will make life for defaulters easier – but this is not so. Section 4 (5c) of the Rental Housing Act, actually stipulates that the landlord has the right to cancel the lease the moment rent is paid late. This could mean that if it is not paid on the stipulated date, the very next day the landlord is entitled to cancel the lease and if the tenant is then tardy about leaving, the landlord can apply for an eviction order. In some cases the lease may provide softer terms and conditions, which would take precedence over the act – but this should never be assumed until the facts have been checked out.
It should also be clearly understood that the act makes mandatory an initial inspection of the premises by the landlord and the tenant meeting together on a stipulated day, as well as, an outgoing inspection when the lease expires. If either of these inspections is missed by either of the parties, for whatever reason, the checklist drawn up by the one who did attend the meeting is accepted and the other party foregoes his rights in this regard. This has very serious implications if the landlord’s claims for damages are high and there are landlords who regularly over-claim on conventional wear and tear items which in fact are not really damages. It is, therefore, particularly important for the tenant to attend the incoming and the outgoing inspection. There are certain other clauses in the Rental Housing Act which are frequently misunderstood and a good rental agent, if properly trained, will quietly and patiently work through these clauses with the tenant and the landlord at the start of every lease.