Whilst often being a fun and affordable way to live, shared tenancies can be one of the most complex situations in terms of establishing the rights and obligations of various parties. The information in this section is intended as a guide only. It does not cover every situation. In shared tenancy situations tenants have different rights and obligations depending on whether they are a head-tenant, a co-tenant, a sub-tenant, a boarder or a lodger. People living in shared tenancy arrangements are not necessarily covered by the Residential Tenancies Act (1987).
The status of the tenant in a shared house situation will depend on the tenancy agreement and the living arrangement. This section should be read in conjunction with the section on The Tenancy Agreement .
A shared tenancy situation can occur in a number of ways. It may be where a group of people enter into a residential tenancy agreement with the owner. The people may have equal rights and obligations in relation to the tenancy agreement with the owner and with each other. These people are referred to as "co-tenants". A shared tenancy may also occur when a person/s who has a residential tenancy agreement with the owner of the premises sub-lets to share part of the premises with another person (or people). The person/s in this situation is referred to as the "head-tenant", and the person/s they have sub-let to as a "sub-tenant/s". A shared tenancy situation may also occur when the owner lives in the premises and rents part of the premises to another person/s. Depending on the agreement, the person renting form the owner may be a sub-tenant and be covered under the Residential Tenancies Act, or a boarder and lodger and not covered under the Act. Further discussion on co-tenants sharing, the head-tenant sharing with a sub-tenant, sharing with the owner or head-tenant, sub-tenants and boarders and lodgers is contained below.
Because of the difficulties in determining the legal status of an occupant in a shared housing arrangement it is suggested that advice be sought prior to entering into such an arrangement. It is also recommended that people in shared housing complete their own agreement between themselves, setting out how rent and other costs are to be divided, how domestic chores are to be organised and, amongst other things, the process for terminating the contract. In writing up the contract it is important to incorporate the terms of the original tenancy agreement with the owner as much as is possible. For example, the amount of notice to vacate required, whether the tenants are liable for water consumption etc.
If there are a number of tenants who hold a single tenancy agreement direct with the owner, you may each be a co-tenant (or joint tenant) and therefore have equal rights and obligations in relation to the tenancy. Co-tenants may be held individually (severally) or jointly liable in the event of there being a breach of the residential tenancy agreement.
The owner can act against any co-tenant when there has been a breach of the agreement even if only one person is responsible for the problem. For example, if the rent is in arrears because one person in the property has not paid their share, the owner can still commence the process for termination against all tenants.
If a co-tenant wants to move out of the premises before the others, and the other co-tenants agree to this, it is suggested to try and negotiate with the owner to have that tenant's name removed from the agreement so that s/he can't be held liable for any breach of the agreement after s/he moves out. If negotiations fail, it would be important to seek advice about your options before moving out.
The Residential Tenancies Act does not cover disputes between co-tenants.
The Residential Tenancies Act does not cover disputes between co-tenants and the Act is therefore not available for the purpose of dealing with disputes between co-tenants. It is advisable for co-tenants to each seek individual advice with a view to drawing up their own contract in relation to their own living arrangements.
Some disputes of a financial nature which occur between co-tenants, for example, recovering a co-tenant's unpaid proportion of energy costs, may be dealt with through the Small Disputes Division of the Local Court. The Court will look at a number of factors including the agreed arrangements to determine whether or not a co-tenant is liable for the amount claimed.
The head-tenant is a tenant who holds an agreement with the owner and then enters into a tenancy agreement with a third person for them to occupy the premises. That third person does not have a direct agreement with the owner. The head tenant may have obligations as an "owner" under the Residential Tenancies Act for the purposes of their agreement with the third person. In order to establish whether this is the case it will be necessary to seek advice.
A tenant should not enter into an agreement with a third person unless they have permission from the owner for another person to occupy the premises, or to sub-let the premises to another person. Otherwise the owner may claim they are in breach of their tenancy agreement.
If you have entered into a residential tenancy agreement with the tenant rather than the owner, or are sharing with the owner, your rights and obligations depend greatly upon a range of factors. You may be a sub-tenant, or a boarder or lodger. Because of the difficulty in drawing distinctions between the different categories; it is wise to seek advice before you move in, or when you first move in, and before acting on any disputes which might arise.
A sub-tenant has an agreement with the head-tenant rather than direct with the owner. The head tenant may take on the role of the "owner" for the purposes of this agreement and the sub-tenant may be covered by the Residential Tenancies Agreement. It is important to seek advice in order to establish the position of the sub-tenant.
Whether you have rights under the Act, or are a boarder and lodger, depends on a range of factors including the tenancy agreement between you and the owner and your living arrangements. You should always seek advice to clarify your situation and your rights and obligations. See the section on Boarders and Lodgers for more information.
Even the best of friends sharing rented premises can have tenancy problems. To avoid unforseen problems it is suggested that you seek individual advice before entering into any arrangement.
Any agreement between the people sharing should be recorded in writing and signed by all parties. Clearly state each person's rights and obligations. Never sign an agreement unless you agree with and understand the terms and conditions. Seek advice before you sign. Ensure that every person who signed the agreement is provided with a copy.
Tenants Advice Service generally does not get involved in shared tenancy disputes because they often lead to a conflict of interest. Tenants Advice Service is a service to assist tenants and it may be a conflict to take the side of one tenant against another. Please call the Ministry of Fair Trading or for information and assistance to resolve a dispute. Also, the housing officer in your student guild may be able to help if you are a tertiary student.
However, Tenants Advice Service encourages people to seek their advice before entering into an agreement as future disputes may be prevented from arising. For advice before entering into a shared housing situation call TAS on .
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