'Diplomatic Clause' (interpretation?)

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'Diplomatic Clause' (interpretation?)

Post by JR8 » Fri, 30 May 2014 7:10 pm

We rented our current place on a 2 year lease, and are now over one year in.

There are several possible moves afoot prior to that two year period ending, and hence I'm looking at and considering the Diplomatic Clause in our Tenancy Agreement.

At a first look it seems badly worded (internally contradictory), and overall it's not really clear to me quite what it means. Such a clause seems a SGn thing, and I'm not familiar quite how they work. It is a template Tenancy Agreement from a major agent.


It reads:
----------------------
'Provided that the tenant has occupied the premises for a minimum period of Twelve (12) months, the tenant may exercise the diplomatic clause by giving the Landlord Two (2) calendar months notice in writing of the Tenant's intention to terminate the tenancy or Two (2) months rent in lieu of notice is the occupier of the premises and employee of the tenant shall be required by the Tenant to leave Singapore permanently on a job transfer or if the said occupier's employment with the said Tenant is terminated for any reason whatsoever. Provided always that the said written notice shall be accompanied by documentary evidence providing the event relied upon by the tenant in the said written notice.
------------------------

and below, with my annotations in Blue:

------------------------
'Provided that the tenant has occupied the premises for a minimum period of Twelve (12) months [we have],

the tenant may exercise the diplomatic clause by giving the Landlord Two (2) calendar months notice in writing of the Tenant's intention to terminate the tenancy [i.e. quit at 14 months]

or Two (2) months rent in lieu of notice if the occupier of the premises and employee of the tenant shall be required by the Tenant to leave Singapore permanently on a job transfer or if the said occupier's employment with the said Tenant is terminated for any reason whatsoever [I am totally lost with this sentence, . 'Employee of tenant'... is this is relation to Foreign Maids or something? ].

Provided always that the said written notice shall be accompanied by documentary evidence providing the event relied upon by the tenant in the said written notice.'

------------------------


The situation might be, we choose to quit and leave the country at say 18 months. The wife is in employment, I'm in self-employment.

From what I see we have a right to exercise the Dip-clause at 12 months, and on a rolling basis thereafter, effective 2 months later.

The Grounds for using the DC aren't clear though, are simply quitting and leaving enough? If not what are the acceptable Grounds?

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Post by taxico » Fri, 30 May 2014 7:23 pm

some properties are rented by the company on behalf of their employees.

diplomatic clause means (how i interpret it) the occupier is moving out of the country, whether by free will or by force, and the tenant can properly terminate the TA earlier than intended after the minimum period - in the case of what you quoted, i interpret it as 2 months notice or 2 months rent in lieu of notice after the minimum period of 12 months (14 months out of pocket at minimum).

i wouldn't take the exact writing of any TA to find loopholes - they are ALWAYS atrociously written and full of punctuation, grammatical and spelling mistakes.

go with the spirit and you'd be all right. using that to move to another property in singapore is certainly going against the spirit of what that clause is meant to be.

if you'd prefer to have an exit clause, write/negotiate that in before signing the TA.
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Post by JR8 » Fri, 30 May 2014 7:42 pm

Ah I see. So you can have a sub-tenant, of a corporate body who is leasing the apartment. I wasn’t expecting that (you have Corporate Lettings in UK law, and it has it’s own very specific set of terms).

So perhaps going with the spirit of ... ‘'Provided that the tenant has occupied the premises for a minimum period of Twelve (12) months, the tenant may exercise the diplomatic clause by giving the Landlord Two (2) calendar months notice in writing of the Tenant's intention to terminate the tenancy...’, is where the matter settles.



... though the inner-cynic expects the landlord to seek ‘revenge’ via my deposit, or other means...

If that reading is correct, and how it actually functions in practice, then that is all the room for maneuver we need, and what we wished to originally negotiate.

Thx.

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Post by sundaymorningstaple » Fri, 30 May 2014 8:28 pm

The kicker is that you must have written confirmation that your wife has been transferred out of the country other documentary proof of same from the employer. So assuming your wife is the main tenant and the employer gives her said necessary documentation it shouldn't be a problem. Her termination wouldn't hold any water as she's local so she couldn't quit and exercise the option I wouldn't think, and as your are self employed, I don't think that will fly either.
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Post by JR8 » Fri, 30 May 2014 9:25 pm

sundaymorningstaple wrote:The kicker is that you must have written confirmation that your wife has been transferred out of the country other documentary proof of same from the employer. So assuming your wife is the main tenant and the employer gives her said necessary documentation it shouldn't be a problem. Her termination wouldn't hold any water as she's local so she couldn't quit and exercise the option I wouldn't think, and as your are self employed, I don't think that will fly either.
Hmmm... the way I was looking at it was ...

-------
‘'Provided that the tenant has occupied the premises for a minimum period of Twelve (12) months, the tenant may exercise the diplomatic clause by giving the Landlord Two (2) calendar months notice in writing of the Tenant's intention to terminate the tenancy Or... [etc]’

I.e. 'And' and 'Or' are used to define exclusive or inclusive requirements. Hence I'd read the first requirement as being completely exclusive of anything that followed (incl corporate lets etc).

-------

The reference to 'employee of the tenant' leaving Singapore, seems to refer to an employee-let (sub-tenancy) with such a person's employer as tenant. But my wife is a main/joint and equal co-tenant together with me, and not sub-letting from me or any intermediary 'below' the owner.


And you wonder why I'm confused... :???:

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Post by sundaymorningstaple » Fri, 30 May 2014 9:43 pm

You need to understand the spirit of the Dip Clause as it is enforced in Singapore. It matters naught whether the lease is held by the company or by the tenant, the tenant must produce documentary proof that the tenant/employee as been either transferred, or released from employment and is being sent home. As you are self employed here or not (not sure of your legal standing and I don't want to know) you cannot, of yourself, exercise the Dip Clause, therefore only your wife can and as she is a Singaporean, the only way that would be possible is if she has been transferred by her employer to another country and documentary proof of same would be required by the LL to effect the clause.
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Post by Beeroclock » Fri, 30 May 2014 10:24 pm

Yes this wording applies if your (or your wife's) employer has taken the lease and sub let to you, as typical in "expat packages" in big MNCs.

One of my leases here as tenant, I did re write the dip clause as per Taxico, giving me the right to exercise if I leave the country permanently for any reason. After a bit of persuading the LL eventually accepted it.

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Post by JR8 » Fri, 30 May 2014 10:28 pm

Hmmm.... and I remember when I used to consider the law as being so black and white, what an early rude awakening it was to find that it is also considered via the prism of what is subjectively decided is 'just and reasonable'.

And now we're meant to divine the 'spirit' of statute, ay-yor ...


I know someone at a reputable local law firm. Maybe I will put the question forward via that person and see what they have to say. If I get feedback, anything useful, I'll post it back here.

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Post by Wd40 » Fri, 30 May 2014 10:31 pm

I like 1 yr contracts, because practically the owners wont sue you, if you tell them you are leaving the place. They just keep your deposit. 1 yr tenancy is 1 month deposit, which is nothing. I mean you go on a 2 week vacation and leave your apartment vacant, that is as good as 1/2 the deposit lost. Then lose another 1/2 of the deposit and move to another place you like.

Landlord wont sue you because if they want to sue you, they will need to keep the place vacant and they wont do it, they would rather try to rent it out to somebody.

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Post by taxico » Sat, 31 May 2014 12:08 am

JR8 wrote: -------
‘'Provided that the tenant has occupied the premises for a minimum period of Twelve (12) months, the tenant may exercise the diplomatic clause by giving the Landlord Two (2) calendar months notice in writing of the Tenant's intention to terminate the tenancy Or... [etc]’

I.e. 'And' and 'Or' are used to define exclusive or inclusive requirements. Hence I'd read the first requirement as being completely exclusive of anything that followed (incl corporate lets etc).

-------

they get you with the commas... in this case, the lack of.
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Post by Mi Amigo » Sat, 31 May 2014 5:13 am

JR8 wrote:I know someone at a reputable local law firm. Maybe I will put the question forward via that person and see what they have to say. If I get feedback, anything useful, I'll post it back here.
I'll be interested to hear what advice you receive about this. In my experience (some of which was based on expensive legal advice), the system (not just the 'rules' but also their interpretation and 'customary practice') is entirely biased in favour of landlords.
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Post by x9200 » Sat, 31 May 2014 7:52 am

That's is not in line with a number of reports also from this board, how relatively easy is get a favorable ruling in SCT against the LLs while attempting* to recover money (i.e. from the deposits).
Or you mean specifically cases of the Dip. Clause where I would expect the LL is favored as this is (as mentioned by SMS) the spirit of this clause? This clause is a favor provided by the LL and favors are not to be abused.

*) recovering this money to the tenant's hands would be a different matter.

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Post by PNGMK » Sat, 31 May 2014 8:50 am

The letter need only be on the letterhead of some company.

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Post by JR8 » Sat, 31 May 2014 9:17 am

x9200 wrote: This clause is a favor provided by the LL and favors are not to be abused.
A favour, ah what generous people local landlords are :)

I'd consider it pragmatically. Many people moving here don't know whether they'll still be here in two years time.

The landlord offering flexibility has an advantage.

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Post by x9200 » Sat, 31 May 2014 2:09 pm

JR8 wrote:
x9200 wrote: This clause is a favor provided by the LL and favors are not to be abused.
A favour, ah what generous people local landlords are :)

I'd consider it pragmatically. Many people moving here don't know whether they'll still be here in two years time.

The landlord offering flexibility has an advantage.
Whatever we call it the LL directly benefits nothing from this, just introduces an additional risk. I don't think any significant fraction of the SG tenants see is as something very valuable. It competes directly with shorter term leases that many people prefer anyway.

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