Northern Territory Ending the Tenancy Agreement
In the Northern Territory, ending a residential tenancy agreement is known as ‘termination’. The landlord or tenant can only terminate the agreement under certain conditions listed below. The tenant or landlord may be liable for compensation depending on the nature of the agreement and the reason for termination.
This guide covers landlords (or head-tenants) and tenants (or sub-tenants) in a Residential Tenancy. This applies to the majority of share accommodation and residential property rental situations. To confirm it covers your situation visit What is my share accommodation situation?
How does termination work?
Under Northern Territory law, there are a certain number of circumstances where the tenancy can be terminated. The landlord or tenant can choose to terminate the tenancy in some situations, and there are other instances where the tenancy will be automatically terminated.
As a general rule, a tenancy agreement cannot be lawfully terminated before the end of a fixed term, unless it is for a specific reason as listed below. Termination before the end of the fixed term for no lawful reason may mean the party terminating the agreement has to compensate the other party.
Termination by agreement
The tenancy agreement can be terminated at any time if the landlord and tenant agree to this. For the sake of greater certainty, it is good practice for the landlord and tenant to note an agreement to end a tenancy in writing.
How do I notify the other party of termination?
In most circumstances, if a landlord or tenant wants to terminate the tenancy, they must notify the other party in writing. There are different forms for the landlord and tenant to use:
- Notice to Terminate Tenancy Agreement—by landlord — for landlords to give to tenants to terminate tenancy agreement
- Notice to Terminate Tenancy Agreement—by tenant — for tenants to give to landlords to terminate tenancy agreement
- Withdrawal of Termination Notice—for landlord or tenant — for landlords or tenants to use if they want to withdraw a previous Notice to Terminate.
Depending on the circumstances, it may be necessary for the landlord or tenant to use the following forms as well:
- Notice to Remedy Breach: Landlord to give to Tenant — for landlords to give to tenants for any breach of tenancy agreement (except for unpaid rent)
- Notice to Remedy Breach: Tenant to give to Landlord — for tenants to give to landlords for any breach of tenancy agreement
- Notice to Remedy Unpaid Rent: Landlord to give to Tenant — for landlords to give to tenants to remedy unpaid rent
- Notice of Storage of Goods: Landlord to give to Tenant — for landlord to give to tenants to notify about storage of goods left behind by tenant
Note: Please read the information provided below about termination before using any of the forms linked above. This will help ensure that you use the correct procedure and form for your circumstances.
Termination and Share Accommodation
If the landlord terminates a co-tenancy, the termination applies to all the co-tenants.
If one co-tenant is moving out but the other co-tenants are remaining, the outgoing co-tenant should notify the landlord. Ideally, the outgoing co-tenant should help to find a replacement who will take over their share of the bond. If the landlord consents, the tenancy agreement should be changed to include the new co-tenant’s name. Alternatively, the incoming and existing co-tenants can sign a new agreement with the landlord.
If the agreement between the head-tenant and the landlord is terminated, the sub-tenant does not automatically lose their right to occupy the premises. The sub-tenant can only be compelled to move out if the landlord is granted a possession order by NTCAT.
If the agreement between the head-tenant and the sub-tenant was for a period of less than 12 months, the Tribunal cannot make a possession order. The landlord can apply to NTCAT to take over the head-tenant’s role in the agreement. This means that the sub-tenant will now pay rent to the landlord.
When can the landlord terminate the tenancy?
The landlord can terminate the tenancy agreement under certain circumstances. The exact process that the landlord and tenant should follow will depend on the reason for termination.
Read more detailed information about when the Landlord can terminate the tenancy.
When can the tenant terminate the tenancy?
The tenant can terminate the tenancy agreement under certain circumstances. The exact process that the tenant and landlord should follow will depend on the reason for termination.
Read more detailed information about when the Tenant can terminate the tenancy.
What happens if the tenant abandons the premises?
Abandonment occurs when the tenant moves out the premises and stops paying rent without giving any notice to the landlord. Abandonment is a breach of the tenancy agreement, meaning that the tenant may be liable to compensate the landlord for any losses incurred as a result. See below for more information about compensation.
If the landlord believes that the premises has been abandoned and there is unpaid rent, the landlord is allowed to retake possession. The landlord can seek a declaration from the Tribunal that the premises is abandoned before attempting to retake possession. Doing so means that the landlord will avoid mistakenly entering the premises if it has not actually been abandoned.
When can I receive compensation?
As a general rule, the landlord or tenant can receive compensation if they have suffered any losses caused by a breach of the tenancy agreement by the other party.
For example, if the tenant breaks the lease before the end of the fixed term, the landlord will generally be entitled to compensation for lost rent. The amount of compensation would generally be the amount of rent payable for the remainder of the fixed term. See below for information about the landlord’s duty to mitigate losses.
Compensation for failure to pay rent
The Tribunal will not order the tenant to pay compensation to the landlord for unpaid rent unless either:
- the rent is at least 14 days overdue, or
- the tenant has previously failed twice to pay rent within 14 days of it being due.
Compensation if tenant fails to vacate by termination date
If the tenant does not move out by the termination date and continues to occupy the premises, the landlord can seek compensation for 2 types of losses incurred:
- Rent Payable — the landlord can apply for compensation for the rent that would have been payable by the tenant, if the agreement was continuing, for the period that the tenant remains at the premises after the termination date.
- Other costs — any other costs incurred by the landlord as a result of the tenant’s failure to move out by the termination date, e.g. eviction costs.
Duty to mitigate losses
Any party receiving compensation is under a duty to mitigate their losses. If they do not take reasonable steps to mitigate their losses, where possible, they may not be awarded the full amount of compensation.
Example: if the tenant has broken the lease, the landlord must make reasonable efforts to mitigate their losses by seeking a replacement tenant. The landlord cannot expect to be fully compensated if they simply leave the premises vacant and make no efforts to find a new tenant.
How does the landlord regain possession of the premises?
The tenant must move out of the premises by the termination date. The termination date is set either in the Notice of Termination or by NTCAT in a termination order. If the tenant continues to occupy the premises after the termination date, they may be liable to compensate the landlord for any losses incurred as a result.
What should the landlord do if the tenant does not move out?
If the tenant has not moved out by the termination date, and the tenancy has been validly terminated, the landlord can apply to NTCAT for a possession order. This order forces the tenant to leave the premises and allows the landlord to retake possession by entering the premises.
Under no circumstances should the landlord attempt to physically remove the tenant from the premises themselves. If the tenant continues to refuse to move out, the landlord should contact the police and have them enforce the eviction.
NTCAT may suspend a possession order for up to 90 days if immediate repossession by the landlord would cause severe hardship (e.g. extended homelessness) to the tenant. In making this decision, the Tribunal will take into account the circumstances under which the tenancy was terminated. For example, whether the tenant breached the tenancy agreement.
What happens if the tenant leaves any goods behind?
Perishable or low value goods
If the tenant leaves behind any of the following goods, the landlord can remove, destroy or dispose of them:
- any perishable goods, including food
- low value goods — only if the fairly estimated value of the goods is less that the cost to remove, store, and sell them.
All other goods
For any other goods, the landlord must follow this process:
- Store the goods — store the goods in a safe place and manner until reclaimed or auctioned off.
- Notify owner of goods — use a Notice of Storage of Goods to notify the tenant that their goods are being stored. If the landlord believes that a person other than the tenant owns the goods, they must notify them instead. Notice must be given within 14 days of the goods being put into storage.
- Newspaper notice — put a notice in a newspaper that circulates throughout the Northern Territory that the tenant’s goods have been stored. The notice must be made within 14 days of the goods being put into storage.
- Reclaiming goods — allow the tenant (or other owner) to reclaim the goods. The landlord is entitled to compensation for the following costs:
- reasonable removal and storage costs
- costs of publishing the newspaper notice
- Auction the goods — if the tenant (or other owner) does not claim the goods within 30 days of when the landlord retook possession of the premises, the landlord must sell the goods at a public auction. The landlord is only allowed to keep the following costs out of proceeds of selling the goods: reasonable costs of removal, storage, and sale, newspaper notice costs, any other outstanding amounts owed to the landlord from the tenancy. Any remaining proceeds should returned to the owner of the goods. If the owner cannot be found, the proceeds must be paid to the Commissioner of Tenancies.
These legal guides provide a brief summary and introduction of the laws and regulations affecting share accommodation. They do not cover all cases in all legal jurisdictions and might not apply in your specific share accommodation situation. It is important that you use this information as a guide only and seek independent Legal Advice or consult the Relevant Acts. We do not accept any liability that may arise from the use of this information.