:???: Early Termination of Lease

[Dayyan James]

I'm looking for a bit of advise regarding early termination of a rental property.
We recently needed to move to a larger unit due to a family matter. Prior to doing so, we consulted with our agent about what can be done regarding early termination of our lease. The landlords agent responded with the following 3 conditions to be met by us. We agreed and took the lease of the new place.

1. He has to continue paying the rent until a new tenant is found. In the event the rent is lower than $3500, he has to bear the differential cost up to his lease period with the Landlord

2. To clean the premises, service the aircons, touch up paint/remove any nails, pay for all minor repairs, clean the curtains etc

3. To be present during the handover to the new tenant

Now, we found a few tenants, all of which are only willing to pay current market rates; a couple of hundred less than what we are paying. We accepted that we will pay the difference, this is unfortunate, but we agree that it is only fair. HOWEVER, the landlord is now refusing to agree unless we also pay the agency fees to cover their perceived losses AFTER our tenancy ends, and to purchase any furniture the new tenant wants.

We have now been paying the empty unit for 3 months and have 6 months left.

We have not agreed to pay the agency fees or purchase furniture yet.

Advice from anyone who has been through something similar, or understands the rules and regulations around these matters would be greatly appreciated.

OR even better, if anyone is looking for a 2br unit with a really awesome landlord .... oh .. never mind.

Take the poll
Thank you

[Beeroclock]

I would also pressure the agent if he has changed the agreement. Based on those 3 conditions you took the decision, so it's not really fair to throw more conditions/costs at you afterwards. Mention that you might consult CEA about this kind of conduct and if it is acceptable. Looks to me like yet another LL intent on pocketing the full 2 month security deposit, at the same time as collecting rent from a new tenant. If you have the time I would take it to SCT too, it only costs $26 or thereabouts and you have a lot more to gain if successful, but also just to signal to this LL that you're not a pushover.

[Dayyan James]

Thank you for the suggestion beeroclock. I'd hadn't occurred to me to contact the CEA. I've already messaged my agent that I will be doing so. It may get some positive traction.

[Wd40]

We have now been paying the empty unit for 3 months and have 6 months left.

No point taking the poll. I would have never done the above, i.e. paid rent for empty unit for 3 months

I would have lied to the landlord that I am about to lose my job and going back to my home country(how would they know) give them ample notice(2 months, more than enough) to look for new tenant and then just left on a specific date, worst case they would keep the 2 month deposit(I would never sign a lease for 2 years for that very reason, worst case, I should lose only 1 month deposit)

That's it, realistically, your worst case, liability for a rented unit should be the deposit, nothing more. Even though according to the contract you are liable to pay the rest of the lease, realistically that is not possible, especially as a foreigner, if you tell them you are leaving the country.

I have no sympathy for most landlords, they are making a killing out of us by renting at inflated prices and its not like if we leave, they wont be able to rent it out to anyone. They will find someone at slightly lower rent, which is more realistic. So no guilt whatsoever, you are losing your deposit anyways!

[Dayyan James]

Hi WD40,

I don't think all landlords are trying to take people for a ride, I think there are a few that do, but perhaps they are more likely to do this to foreigners as there are probably a few that choose to be dishonest about their reasons to terminate.

I wouldn't lie to save myself money at someone else's expense. it serves only to further alienate us as the "bad guys" at a time when there is already a lot of anti foreign sentiment.

But it does make me think about 2 year leases in a whole new light. That I agree with. I do not recommend 2 year leases.

[Wd40]

But do you think its fair on the landlords part to leave the house vacant for 3 months and make you pay for it? They could have rented it for like 10% or even 20% lower and even then you would haven't lost that much money.

In my case, I faced a very similar situation. I really lost my job and gave notice to my landlord and also helped a lot in finding a replacement tenant. My rent was 2.4k for a 3 bedroom HDB and eventually they said they found someone after a gap of 15 days and they didn't want to keep it vacant and so rented it out for 2.2k(That's what they told me, I am not really sure, if that's the truth). I lost my 1 month deposit, which I think is fair enough because of the loss of rent for the remaining 6 months of $200 each month. Eventually I did find another job in Singapore, while I was in the same house, but I decided not to tell the landlord since I have already given the notice and I could find another place for lower rent after coming back from a vacation.

[zzm9980]

The poll is irrelevant. Are there any conditions or terms on breaking your lease in the tenancy agreement? If not, did the landlord give you those three conditions in a signed contract? If not to either, unfortunately you're on the losing side. Legally you're bound to whatever the tenancy agreement says. If it says nothing on the subject, you're bound to pay rent until the end of the term. Anything you can do to lower this amount is a bonus to you.

[x9200]

DJ, you wrote that it was you who brought the new tenants in so I assume you agreed to undertake this task and the LL accepted it.
The problem I see is that it is not reasonable to expect the LL will accept any tenant. If the new tenant demands something extra (furniture?) this is not necessary to be always accepted by the LL. If nothing was agreed earlier on this, you insist on this tenant and the new tenant insist on the furniture with all the info you provided I would expect you to pay for it.

As of the commission, I don't understand why the LL have to pay any, if his agent did not look for the replacement tenants. If this is only for the paperwork part, then this is a situation the LL could have easily predicted (should have known) at the moment he came up with is demands so I don't think you should pay it.

[x9200]

The poll is irrelevant. Are there any conditions or terms on breaking your lease in the tenancy agreement? If not, did the landlord give you those three conditions in a signed contract? If not to either, unfortunately you're on the losing side. Legally you're bound to whatever the tenancy agreement says. If it says nothing on the subject, you're bound to pay rent until the end of the term. Anything you can do to lower this amount is a bonus to you.

Let's assume the lease is already broken and now they are just negotiating a compensation package. I don't think they need any written amendments to the old contract.

[JR8]

@WD40
Oh dear no. If you’ve leased a place then you are tied to the terms of that agreement, unless agreed otherwise. What you arbitrarily consider ‘ample notice’ is not relevant.
‘Worst case’ is the the landlord takes a court case against you, in your apparent absence, and since you don’t show up the judge (probably automatically) decides/finds against you. When you don’t comply with the terms of said judgement, since you’ve ‘disappeared’, the landlord applies for an Enforcement Order, and again since you aren’t around, you won’t know. Then X months/years later, you’re off with your extended family and guests for your wedding, in Australia woo-hoo!! Wonderful, until your plane gets diverted via SG (as you already suspect you’re perhaps in the s*** if you visit SG again you’ve never been back, not even a flight via Changi), and hey presto... you get arrested on arrival. Great plan lol; unfortunate the shame on the family caused by their ‘fugitive criminal son’ getting carted off to remand-detention!!

More seriously. A deposit is taken to compensate for any damage caused above and beyond ‘fair wear and tear’. It is not there in lieu of unpaid rent. If you are a party to a tenancy agreement and stop paying the rent as required, then you are in the wrong. If it ended up in court a scenario of ‘Judge: so Mr. WD40 why did you stop paying rent and so break the terms of the lease?’ – ‘WD40: Because I suspected the landlord was going to break the terms of the lease’ is not going to work. At that point, you are in the wrong, and the landlord has done nothing wrong. In legal action, especially smaller scale matters like residential Landlord + Tenant, a lot of ‘merit’ is credited to those who proceed demonstrating goodwill/good-faith.

It’s a two way street. A landlord who has experienced what you are recommending is going to be left both out of pocket, and extremely pi$$ed off. Most landlords do not ‘make a killing’, especially in the early days, but that is irrelevant, their personal financial circumstances are nothing to do with the tenant. What next? ‘Judge: So Mr. WD40 why did you stop paying rent and so break the terms of the lease?’ – ‘WD40: Because I suspected the landlord was going to break the terms of the lease, and because he’s making a killing’?

Overall your attitude is irresponsible, and the kind that can give tenants a bad name. It is also one of the reasons that landlording is far from ‘easy money’ as a few non-landlords seem to imagine, as you get to deal with the occasional grade #A –hole. Thankfully though, such experiences are very few and far between, but there is also definitely an element of ‘you reap what you sow’, and it's worth remembering that landlords are often far more experienced at reaping, than tenants are at sowing.

[Wd40]

JR8, I know the law. I am not saying, just stop paying rent and leave. I am saying tell the landlord you have lost your job and that you need to leave the country on x date and that you will help them find a tenant and that they can keep part of the deposit/whole deposit in case of any losses. If the OP had done this 9 out of 10 landlords would agree to terminate the lease and keep the deposit. I am yet to see a landlord who will force you pay the rest of the lease or take you to court. Reason: If they have to take you to court they will have to spend money and also they will have keep the unit vacant. The more practical and sensible choice for them is to rent it out to another tenant and as per my knowledge the market isn't bad and they can find a tenant easily, may be slightly lower rent but then the deposit is good to cover the losses.

That's how I see it. My experience, thus far, has been with 30-40 yr old HDBs which the landlords have paid off long ago and what 18k-20K and now they are taking more than that per year as rental. That's a killing! But regardless, as I said, I have yet to see a landlord who will want to take me to court if I break lease. In fact most of my friends ask me why did I let the landlord keep the deposit and that I should have asked it back, which I know is a bit unreasonable, but that's how the tenant are these days, especially in my circle( you know what type )

[zzm9980]

The poll is irrelevant. Are there any conditions or terms on breaking your lease in the tenancy agreement? If not, did the landlord give you those three conditions in a signed contract? If not to either, unfortunately you're on the losing side. Legally you're bound to whatever the tenancy agreement says. If it says nothing on the subject, you're bound to pay rent until the end of the term. Anything you can do to lower this amount is a bonus to you.

Let's assume the lease is already broken and now they are just negotiating a compensation package. I don't think they need any written amendments to the old contract.

Right, but if the lease is broken OP owes $X - remainder of the lease. They're negotiating to lower that value for $X, but the way I see it any legal dispute will result in the judge just coming back to that $X.

[Dayyan James]

That's not quite right.
The issue is that we are being forced to accept a new conditions (paying the agency fee and furnishing the house), of which had we been told at the offset would have calculated that it was going to disadvantage us to much and would not have taken a lease on the next place until we could have resolved that with the landlord first.

We had three conditions to meet as part of the agreement with the landlord when we advised then of our situation and the need to move. These are noted above.

We agree that it's fair for us to cover the difference where the new tenants offer is lower and to perform minor repairs and touch ups.

The landlord has agreed for us to break lease, but is imposing unreasonable NEW conditions that weren't previously agreed to by us.

[x9200]

The poll is irrelevant. Are there any conditions or terms on breaking your lease in the tenancy agreement? If not, did the landlord give you those three conditions in a signed contract? If not to either, unfortunately you're on the losing side. Legally you're bound to whatever the tenancy agreement says. If it says nothing on the subject, you're bound to pay rent until the end of the term. Anything you can do to lower this amount is a bonus to you.

Let's assume the lease is already broken and now they are just negotiating a compensation package. I don't think they need any written amendments to the old contract.

Right, but if the lease is broken OP owes $X - remainder of the lease. They're negotiating to lower that value for $X, but the way I see it any legal dispute will result in the judge just coming back to that $X.

Not necessary. The judge will evaluate the situation and this will include assessment if the parties where acting reasonably and in good faith to minimize the damage.

For example:

If the tenant finds a substitute tenant to take over the lease, and there are no objective reasons why the LL should not accept it and the LL still refuses I believe there is no way the LL will ever get the full $X amount. I would not be surprised if in such case the LL gets a compensation equal to 1 month rent or even less (or related to whatever it took to find the replacement tenant).

If the tenant breaks the lease for some frivolous purposes, does nothing to repair/minimize the damages, then I would expect the full $X amount will be ordered to be paid plus the legal expenses of the court (even in SCT).

For anything in between, the judge will likely rule the compensation amount based on the scenario where both parties acted in good faith. It may be assumed that it is enough to find a replacement tenant within, say, 3 months and the total compensation amount should be around: rental for 2-3 months + the agent's fees + something for the inconvenience.

I am using the word compensation, but in reality this would consist of what belongs to the repair of the damages (tangible part) and the compensation (inconvenience/etc. related).

Any modern legal system is based (theoretically) on social justice and things mentioned above are typically taken into account.

[JR8]

The communication you had with the three conditions, do you think that in court that would be considered release from the Tenancy Agreement (TA) and ‘full and final settlement’ of any outstanding matters? It’s not clear what went on to arrive at that short-list, or how that communication was phrased, hence the question. The 3-item list is rather poorly conceived*, so it wouldn’t surprise me if he later revisited it, realised his missed opportunity (to gouge you), and turned it into a longer, equally poorly conceived ‘wish list’.

Did you pay stamp duty on the TA, and if so do you have proof it was paid?

The landlord would have paid his agent one months rent in commission on a 2 year lease. Since any replacement tenant that you find won’t incur additional agent’s commission, it’s unclear to me why and what you’re being asked to ‘compensate’ for. How has he explained/justified this demand?

Furnishing. Refer to para #1 above


*1) seems reasonable.
2) This is more or less a standard clause anyway, so there’s no value in having repeated it. (That said: Generally speaking, minor repairs that come under the heading of ‘Fair wear and tear’ would not be a tenant’s responsibility. However in this case, of negotiation for early release, it might be considered reasonable for the landlord to make this additional demand).
3) I can’t see the point of this, can you?