Cancelled contract

Question from Suresh updated on 12th September 2014:

Hi, I have paid two weeks advance for a house rental and was supposed to move in. But about two days before the move in, I have cancelled it. The agreement was not signed and the contract was not discussed formally, with just a two-week notice expected from either party. Also it was supposed to be a weekly rental. How much of the advanced rent am I eligible to get back since I have not yet moved in?

Our expert Alan Bruce responded:

Under the Residential Tenancies Act 1986 (the Act), a tenancy agreement that has been entered into verbally is still valid, even if it is not in writing. If you and the landlord agreed that you can rent the premises from a certain date, discussed the amount of rent to be paid, along with any other terms and conditions, it may be that you have already entered into a valid tenancy agreement. Each case will depend on its own circumstances and will depend upon your discussions with the landlord. Where a tenancy agreement has been verbally entered into between a landlord and tenant, both parties would need to comply with their obligations under the Act. This includes the requirement for either party to give notice to terminate the agreement. Based on the information you have provided, you would be required to give the two weeks’ notice to terminate your agreement. This notice to terminate can also be given prior to moving into the property. The Act does not allow a landlord to contract out of their responsibilities and therefore the landlord would not be able to give less notice than is specified by law. Any rent that you paid prior to the tenancy commencing may be utilised by the landlord to cover any rent that is due from the date the tenancy commences, until the date the tenancy ends. You may be entitled to a rent rebate depending on when the notice was served. An example of a notice template for tenants, and information on service times can be viewed and downloaded on the Ministry’s website by visiting: http://www.dbh.govt.nz/pub-tenancy-notice-letters#map7. If you are unable to reach an agreement regarding the ending of the tenancy, you could apply to the Tenancy Tribunal to have the matter resolved. The Tenancy Tribunal does not set precedents, and any matter brought before the Tribunal is determined on the circumstances of each individual case. To discuss your situation further, or for information and advice about terminating a tenancy agreement, you can call 0800 TENANCY (0800 836 262) between 8.00am-5.30pm Monday to Friday to speak to a member of our Tenancy Advice Team.

The Ministry of Business, Innovation and Employment provides information and guidance on building law and compliance, services including weathertight homes, and advice for tenants and landlords.

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