Ending fixed-term tenancy, is tenant liable for rent?

Question from Peter updated on 23rd February 2011:

My tenant through my property manager asked to break his fixed term tenancy. As part of terms he agreed to continue to pay rent until new tenant was found & moved in. After 6 wks marketing with average response my property manager advised an upgrade of unit areas to be more marketable. Property was not marketed while this was done. I agreed to repay tenant for rent paid during this period. 4 wks after it was back on market, new tenant found & moved in. My property manager is now saying previous tenant is not liable for the 4 wks rent after upgrade when initially they advised me in writing - he was. What's correct?

Our expert Juliet Robinson responded:

Technically, a tenant breaking a fixed term tenancy is responsible for rent up to the time a replacement tenant starts paying rent.  At that point his fixed term liability ends.

However, it appears you took an opportunity, after the tenant had moved out, to improve the property.  You say it was with the tenant’s agreement and you agreed to repay the rent for that period.  The problem is that nothing was done to market the property during that “down time”, and you finished up with the advantage of a more marketable property.

Whether the tenant is liable for the 4 weeks’ rent will depend on the specific facts of your case and whether the tenant agreed to (a) no marketing while the upgrade was in progress and (b) continuing liability after the work was completed.

If the facts indicate that the tenant surrendered possession to you, you may find that he is not liable for the 4 weeks’ rent.  You can’t have your cake and eat it!

Quinovic's outstanding people and systems provide the most professional, effective and reliable residential property management service in the NZ market for over 22 years.

 

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