The Bond Dispute Process

Tenants have vacated, but there are issues. What happens now?

All tenants have an obligation to return a property back to the original condition as at the start of the tenancy and outlined in the Entry Condition Report. The only exception is for wear and tear. This is explained in a previous blog – https://blackbirdandfinch.com.au/thepmfiles/when-damage-occurs-at-a-rental-property/

But what happens when there is damage or another issue but the tenants and the owner/agent disagree?

The tenants’ obligation to return the property to a fair condition is a part of the tenancy agreement. It is a common misconception that the tenants then have 3 days to go back to the property to rectify any issues. In fact, it is the agents or owners of the property that have 3 days to attend to the Exit Condition Report.

This is similar to the Entry Condition Report when the tenants had 3 days to complete their report.

Once completed, the agent or owner will advise the tenant by returning the Exit Condition Report or notes of the vacate inspection.

Depending on whether and when new tenants are due to enter the property, the tenants may be given a chance to return, however there is no obligation to. Many properties only have a 3-4 day turn around between tenancies so time is of the essence.

It is the tenants’ responsibility to ensure the property is returned to that condition on the last date of the tenancy (the vacate date). Property Managers are generally under the pump to ensure the property is back to the condition for the new tenants, therefore may not allow tenants to return to the property and just engage a tradesperson.

Remember: The current Exit Condition Report is the new tenants Entry Condition Report.

If the agent/owner feels that there are further cleaning issues or damages, they may make a claim on the Bond at that point and engage cleaners or tradespeople. It is an owners/agents obligation to ensure that they are ‘mitigating the loss’ for the tenant though. This means that an agent or owner can’t draw out the repairs and claim loss of rent or engage the most expensive tradesperson eg, a builder doing a handyman job.  Agents and owners can only claim ‘reasonable’ costs. Owners claiming for the cost and then doing the work themselves would not constitute a reasonable cost, however engaging a qualified tradesman at a reasonable price would.  There may also be compensation costs which have been explained in a previous blog.

If the agents or owners make a claim, an email is sent from the RTA advising the tenant that there has been a claim on the Bond. The tenant can then agree with the claim, input their bank details and receive the rest of the Bond within 48 hours.

If the tenant does not agree, the dispute process will begin.

RTA will receive the notification from the tenant that they do not agree to the claim and will set a mediation date. This is generally a 3-4 week wait.

During that time, both parties can still communicate and often can come to an agreement before the RTA mediation date has been set.

Agents and owners need to convey all costs to the tenants including photographs of before and after and copies of invoices. Tenants need to keep in mind that there is no obligation to get quotes or look for the cheapest tradesperson. This was their obligation to do before the tenancy ended.

If all parties can not agree to the Bond, the RTA mediation takes place. The RTA conciliator will only allow 1 person to speak (a representative is chosen before hand if there if more than 1 tenant) and all parties will be given a chance to explain their views.

In most cases, an agreement is drawn up and sent to each party to sign and the Bond refund is processed.

If all parties do not agree, then the matter is escalated to the Queensland Civil Administrators Tribunal commonly known as QCAT. This is the final stop for all RTA and tenancy disputes. QCAT in Toowoomba is held in the Magistrates court and is presided over by a Judge.

The QCAT process can be tedious and costly for both parties therefore mediation is a prerequisite for most disputes.

Communication is the key in ensuring a fair outcome for all.