August 28, 2008

In this article we would like to remind agents who manage residential tenancies of the importance of the time limits for recovery of rental arrears under the Residential Tenancies Act in Queensland. Section 249 of the Act states that if the Landlord or Tenant claims there has been a breach of the agreement either one may apply to the Small Claims Tribunal within 6 months of becoming aware of the breach for an order about the breach (the Tribunal considers claims up to $7,500 and over that, the claim must be made in the Magistrates Court).

How strict is the six-month time limit?

The Queensland District Court* recently ruled, in a case where rental arrears were five years past due, that the six-month time limit applied and the debt was unrecoverable.

The six-month time limit applies whenever a landlord or tenant makes a claim under the rental agreement. Arguably, there is scope for bringing the claim outside the six-month time limit if the claim is bought independently of the residential tenancy agreement. It could be pleaded for example that rental arrears are simply a debt. A claim pleaded in that way may escape the six-month time limit.

As a best practice rule, agents should, therefore, advise their landlords that rental recovery should commence promptly and before the expiration of six months following the date upon which the rental or other payment was due.

*Delahoy & Grevell v Wuiske & Anor [2006] QDC 276

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