Both Tenants and Landlords in Central Otago need to be aware of what can and cannot be included in a residential Tenancy Agreement.

The Residential Tenancies Act 1986 (”Act”) sets out the rights and obligations for both parties, and it is not always possible to get out of these.

If a clause contradicts the Act, that clause is likely to be unenforceable. In some cases, including such a clause could be an unlawful act resulting in a fine.

When is a clause unenforceable?

Despite what a residential Tenancy Agreement states, a Landlord cannot set rules beyond the law, a Tenant cannot sign away their legal rights, and the Act cannot be evaded.

If a clause attempts to do so, it is unenforceable. An unenforceable clause has no legal effect, even if both parties have agreed to it.

Common unenforceable clauses

Professional cleaning requirements

This most commonly involves cleaning clauses. Under the Act, Tenants must keep the property reasonably clean and tidy.

A clause requiring Tenants to have carpets professionally cleaned at the end of the tenancy is unenforceable, as it imposes an obligation beyond the Tenant’s legal duty. Usually, a thorough vacuuming and spot clean is enough to reach this standard.

If the carpets are visibly dirty or stained, a professional clean may be necessary, but it cannot be required as a condition of the tenancy.

Restrictions on Noise and Parties

Loud music and parties are common sources of tension in rental properties.

Tenants have the right to quiet enjoyment of the property, meaning they have the right to the full use and benefit of the property.

A Landlord must not interfere with a Tenant’s reasonable peace, comfort, or privacy. At the same time, Tenants must not interfere with the reasonable peace, comfort, or privacy of others in the neighbourhood.

A clause that outright bans parties is unenforceable, as it unfairly limits a Tenant’s right to enjoy the property. However, Tenants who breach their obligations under the Act could face consequences.

The Tenancy Tribunal has found Tenants who play excessively loud music late at night, or host parties for extended periods, to be in breach of their responsibilities.

Notice Periods

Notice periods for ending a tenancy are set by law. For example, a recent law change allows a Landlord to end a periodic tenancy without reason by providing 90 days’ notice.

A clause allowing a Landlord to give less notice than required by the Act is unenforceable.

This is true even if the Landlord and Tenant reach a ‘win-win’ deal, such as the Tenant paying reduced rent in exchange for the Landlord being able to terminate the tenancy with 30 days’ notice.

Summary

Tenancy Agreements must comply with the Act, and clauses that contradict the Act are unenforceable. Including such clauses can create confusion, disputes, and even legal consequences.

To avoid unnecessary stress or potential fines, Landlords should ensure their Tenancy Agreements align with the law, and Tenants should be aware of their rights.

Checketts McKay Law’s team of tenancy law specialists can assist Landlords and Tenants in navigating Tenancy Agreements and ensuring compliance with the Act.

This article offers an overview of one aspect of tenancy law and is not intended as legal advice.