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Is your client a renter, resident, site tenant or licensee?

Last updated: 29 Mar 2021

Overview

The Residential Tenancies Act 1997 (Vic) (RTA) defines the rights and duties of:

  • Renters under a residential rental agreement (i.e. tenants);
  • Rooming house residents;
  • Caravan park residents;
  • Part 4A site tenants; and
  • SDA dwelling residents.

It is important to consider which of the above categories your client falls into as the RTA regime for each category is different. Your client may also be a licensee and therefore not covered by the RTA.

Practice tip

The RTA is assumed to apply until the contrary is proven. The person or party who asserts the RTA does not apply bears the onus of proving that it is not applicable: s 507.

Is your client a renter?

Section 3 RTA defines a renter (formerly, a tenant) as:

  • the person to whom premises are let under a residential rental agreement; or
  • the person to whom premises are to be let under a proposed residential rental agreement.

Section 3 also provides that a residential rental agreement (formerly, a tenancy agreement) is an agreement, whether or not in writing and whether express or implied, under which a person lets premises as a residence and includes a fixed term residential rental agreement and a periodic residential rental agreement. SDA residences (see below) are expressly excluded.

The RTA does not provide significant guidance on identifying who is a renter. Generally, a residential rental agreement exists where a person pays rent to the residential rental provider for exclusive possession of residential premises (such as a house or flat). The renter may also use the rented premises for trade, professional or business purposes, provided that residential use is the primary purpose: s 7, but see s 8 RTA.

Exclusive possession refers to the ability to exclude others from the premises, including the residential rental provider. This situation can be compared with rooming houses where residents may share a house with other residents and the rooming house operator.

A person may still be a ‘renter’ where the residential rental provider calls your client something else, such as a licensee. It is necessary to look at the nature / substance of the relationship rather than the terms used.

Exclusions

Some residential rental agreements are specifically excluded from the operation of the RTA and this may depend on the type of premises involved. Farming premises (s 11), hotels and motels (s 20) and educational institutions (s 21) are examples of premises that are excluded from the operation of the RTA. See further ss 5 to 15 RTA.

Is your client a rooming house resident?

The RTA sets out a separate scheme to govern residents of rooming houses.

What is a rooming house resident?

A rooming house resident is defined as a person who, with the agreement of the rooming house operator, occupies a room in a rooming house as his or her only or main residence: s 3 RTA.

A rooming house is a ‘building other than an SDA enrolled dwelling in which there is one or more rooms available for occupancy on payment of rent, in which the total number of people who may occupy those rooms is not less than four, or in respect of which a declaration under s 19(2) or (3) is in force’: s 3 RTA.

A room means a room in a building, where the room is occupied or intended to be occupied for the purpose of a residence by a person having a right to occupy the room together with a right to use in common with others any facilities in the building but does not include a self-contained apartment: s 3 RTA.

A rooming house operator is defined as a natural person who, or a body corporate that, conducts the business of operating a rooming house, whether or not the rooming house operator owns the property on which the rooming house is located; s 3 RTA; s 3 Rooming House Operators Act 2016 (Vic).

A resident cannot transfer or assign their rights as a rooming house resident: s 93 RTA.

 

Types of rooming house residency agreements

A resident has the right to reside in the room that they occupy, and use the facilities in the rooming house, which may be an exclusive or shared right: s 92 RTA.

An exclusive occupancy right can be held by two people, for example, two domestic partners may share a room and have exclusive occupancy. The rooming house operator is not permitted to introduce another person to the room if they have granted an exclusive occupancy right: s 92A RTA. If the rooming house operator has granted a shared room right the rooming house owner can choose which residents occupy the room: s 92B RTA.

Residents and rooming house operators may enter into an agreement which specifies the terms and conditions of a resident’s use or enjoyment of the premises, either for a fixed-term or on a periodic basis: s 93A(1); s 94(2). Fixed term agreements must be in writing and in the prescribed form: s 93A(2).

A term or condition in a rooming house agreement that purports to restrict, exclude or modify a right in the RTA is invalid: s 94A(3).

Rooming house operators can enter into a residential rental agreement in relation to a self-contained apartment in a rooming house. In such cases the rooming house provisions in the RTA may not apply depending on the ratio of rooming houses to self-contained apartments: ss 18, and 94(1) RTA. Residential rental agreements entered into in relation to self-contained apartments cannot be for a fixed term of more than five years: 94(3B).

 

Checklist – Is your client a renter or resident? Does the RTA apply?
  1. Is the person named as a renter on a written lease?
  2. Does the person pay rent?
  3. Can the person exclude others from their premises (exclusive possession)? If yes to the above, the person may be a renter, resident or Part 4A site tenant.
  4. Share house: Does the person share the premises with others? Is there a lease? Who is listed on the lease?
  5. Rented room: How many rooms are for rent in the premises?
    1. Is there only one room for rent in the premises? If so, the person may be a boarder, who may not be covered by the Act.
    2. Are there other rooms for rent? Is the total number of people who may occupy the other rooms (including couples) at least four people? If so, the person may be a rooming house resident.
  6. Caravan parks or Part 4A site parks: Does the person live on a property where there are movable dwellings available for occupation? If yes, the person may be a caravan park resident or Part 4A site tenant.
    1. Does the person live in a movable or immovable dwelling as their main residence? Do they have written agreement from the caravan park owner to live there? Have they lived there for more than 60 days? If yes, the person may be a caravan park resident.
    2. Does the person live in a dwelling that is designed to be moved from place to place? If yes, the person may be a Part 4A site tenant.

Is your client a caravan park resident?

A caravan park is defined as an area of land on which movable dwellings are situated for occupation on payment of consideration. A place can be a caravan park even if it contains immovable dwellings: s 3 RTA.

A caravan is a movable dwelling or an immovable dwelling situated in a caravan park: s 3 RTA.

A caravan park owner means any person who is (either wholly or partly) the owner of a business which operates a caravan park: s 3 RTA.

A resident in relation to a caravan park is a person (other than a site tenant – see below) who occupies a site in the caravan park as his or her only or main residence who has (s 3):

  • obtained the prior written agreement of the caravan park owner to do so (whether that agreement was given in respect of that site or another site in the caravan park); and
  • so occupied any site in the caravan park for at least 60 consecutive days, unless they are under an occupancy agreement which is expressed to be for holidaying or non-residential purposes.

 

Practice tip

There is a considerable cross-over between site tenants and caravan park residents in that they both occupy caravan parks. Which category the client falls into should be carefully considered.

Is your client a Part 4A site tenant?

Part 4A site tenants are owners of a movable dwelling who rent the land where their movable dwelling is placed. An explanation of this definition under the RTA is set out below (see also the definitions in ss 3 and 143AA).

A ‘site’ is a site in a caravan park.

A site tenant is a person to whom a Part 4A site is let under a site agreement.

A site agreement is an agreement under which a person lets land as a Part 4A site for the purpose of the occupation of a Part 4A dwelling on that land by the Part 4A dwelling owner as a residence.

A Part 4A dwelling is a dwelling which is fully or partially owned by a site tenant which is designed, built or manufactured to be transported from one place to another for use as a residence. However, a dwelling is not a Part 4A site dwelling if it is a movable dwelling registered under the Road Safety Act 1986 (Vic) (i.e. a caravan): s 3 RTA

A Part 4A site is a site that is available for occupation under a site agreement.

 

Is your client a SDA resident?

For more information on SDA enrolled dwellings see Specialist Disability Accommodation.

‘SDA’ is an acronym for specialist disability accommodation. It is a form of accommodation provided to national disability insurance scheme (NDIS) participants who require specialist housing support. Only people with extreme functional impairment or very high support needs who meet specific eligibility criteria are eligible for SDA.

SDA enrolled dwellings differ from residential services provided under the Disability Act 2006 (Vic). Victoria is still transitioning to the NDIS residency regime and some disability accommodation may still be regulated by the Disability Act 2006 (Vic). The exact regulatory regime the accommodation is governed by should be carefully considered for any clients living in supported accommodation.

Under the RTA, SDA residents are NDIS participants who are funded to reside in an SDA enrolled dwelling or an older person who not an NDIS participant but who is receiving continuity of supports under the Commonwealth Continuity of Support Programme for specialist disability services for old people (a CoS support accommodation client): s 498B RTA.

An SDA enrolled dwelling is a permanent dwelling that provides long-term accommodation for one or more SDA residents and which is enrolled as an SDA dwelling under the National Disability Insurance Scheme (Specialist Disability Accommodation) Rules 2020 (Cth) or the National Disability Insurance Scheme Act 2013 (Cth): s 3 RTA.

SDA enrolled dwellings can be (s 3):

  • an area or room exclusively occupied by an SDA resident and common areas shared by other SDA residents under an SDA residency agreement;
  • the dwelling as a whole occupied exclusively by an SDA resident under an SDA residency agreement; or
  • the dwelling as a whole occupied under a residential rental agreement by at least one SDA resident and other occupants who may or may not be SDA residents.

 

Is your client a licensee?

Licensees are not provided with rights under the RTA. It is therefore important to determine whether your client is a licensee because this will determine whether they are protected by the RTA.

In considering whether a license has been created, it is necessary to look at the facts and intention of the parties and ask whether it was intended that the client pay rent for exclusive possession of the premises.

Generally exclusive possession is found not to exist where a party rents a room only. There is also a presumption that the agreement is a license if the licensor also lives at the premises. These presumptions may be overturned by evidence that the client is living in a rooming house, or in a sublease arrangement where a head renter agrees to provide a sub-renter with exclusive possession of the sub-leased premises (i.e. with a lock on the door to their room).

When considering whether the client is a licensee, it is also necessary to consider whether the client comes within the definition of a rooming house resident as there can be some overlap.

 

Practice tip – is your client a licensee?

In considering whether the client may be a licensee it is important to obtain instructions about the following:

  • Does the client pay rent for exclusive possession? (Is there a lock on the door, can the client exclude all others? Is the room self-contained in some way? Does the room have a private bathroom or kitchen?)
  • Does the client live with the owner of the premises?
  • Is it possible to classify the premises as a rooming house?
  • Alternatively, is it possible to classify the client as a sub-renter? (Note that section 81 of the Act provides that a renter must not assign or sublet premises without the residential rental provider’s written consent. In the absence of consent, the sublease/assignment will be invalid unless the Tribunal has determined that consent is not required.)

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