Unpaid Rent Arrears in Queensland

Unpaid rent arrears in residential property can have a serious impact on landlords’ cash flow.

The popular misconception is that landlords are all wealthy property tycoons – but this is simply not true.

A vast majority of investors are small investors who own only one (1) investment property.

Landlords and owners have bills to pay, a mortgage to pay, perhaps property manager or property agent commissions to pay.

Unpaid rental arrears and other residential tenancy problems in Queensland is governed by:

1. Residential Tenancies and Rooming Accommodation Act 2008 (QLD) (“Act”); and
2. Residential Tenancies and Rooming Accommodation Regulation 2009 (QLD) (“Regs”).

In this article our Queensland debt recovery lawyers will explain the process of debt recovery for unpaid rent arrears and the eviction of a bad tenant for unpaid rent.

Rent arrears can have a huge impact on cash flow.  If you have tenants who owe unpaid rent then contact us immediately.  Our lawyers provide expert help with rent arrears and eviction of tenants

Unpaid Rent Arrears – Residential Tenancy

Section 10 of the Act says:

“Residential premises” are premises used, or intended to be used, as a place of residence or mainly as a place of residence.

Section 11 of the Act says:

“Residential tenancy” is the right to occupy residential premises under a residential tenancy agreement.

Section 12 of the Act says:

A “Residential tenancy agreement” is an agreement under which a person gives to someone else a right to occupy residential premises as a residence.

A residential tenancy agreement can be wholly or partly in writing, wholly or partly oral, and wholly or partly implied – or any combination of these.

So, best case scenario is that you have an RTA Tenancy Agreement, but any document which says “Residential Tenancy Agreement” will usually suffice.

However, in our experience we see all kinds of informal agreements.  If you are a landlord who has an informal agreement and you are unsure if it is a residential tenancy agreement, then you should contact us to see if it is an agreement to which the Act applies.

Breach for Non-Payment of Rent

If the tenant has not paid rent for seven (7) days, then the landlord must give the tenant a notice to remedy the tenants breach.

The prescribed form for a notice to remedy the tenants breach is a Form 11.

Section 325 of the Act prescribes the requirements of the notice to remedy the tenants breach:

The approved form must provide for the notice (a) to be signed by or for the party giving the notice; and (b) to include particulars of the breach; and (c) to state the day by which the party to whom the notice is directed is required to remedy the breach.

The tenant will then have a minimum of seven (7) days to remedy the breach.  Section 328(1) of the Act says:

The allowed remedy period for a notice to remedy breach must not end earlier than 7 days after the notice is given.

If the tenant fails to pay the rent in this time, then the landlord can give the tenant a notice to leave for unremedied breach.

Notice to Leave for Unremedied Breach

If the tenant does not pay the rent by the time stipulated in the notice to remedy breach, then the next step is to issue a notice to leave for unremedied breach.

The prescribed form for a notice to leave for unremedied breach is a Form 12.

The Form 12 must be issued after the date the tenant had to remedy the breach (pay the rent arrears).

Section 326 of the Act prescribes the requirements of the notice to leave for unremedied breach, and includes that the notice must:

Be in the approved form; and be signed by or for the lessor; and identify the premises; and require the tenant to hand over vacant possession of the premises to the lessor on the day stated in the notice; and state the ground on which the notice is given; and give particulars of the ground on which the notice is given.

The notice to leave for unremedied breach must also state that information about the tenant’s rights and obligations is contained in the agreement; and that the landlord may apply to QCAT for a termination order without giving the tenant any further notice.

The notice to leave for unremedied breach must give the tenant a prescribed time to leave – for rent arrears the amount of notice is seven (7) days.

Section 329(2)(a) of the Act says:

The handover day for a notice to leave given by the lessor must not be earlier than – if the notice is given because of an unremedied breach and the breach is a failure to pay rent – 7 days after the notice is given.

If the tenant fails to leave then the landlord must make an urgent application to the Queensland Civil and Administrative Tribunal (“QCAT”) for an order terminating the tenancy and issue a warrant of possession.

The date on which the tenant must leave is called the “handover day”.

Schedule 2 of the Act says:

“Handover day” for premises, means the day stated in a notice to leave … as the day vacant possession of the premises is required to be … handed over to the lessor.

Serving the Notices by Post

Clause 44(3) of the RTA General Tenancy Agreement says that:

A notice may be given to a party to this agreement or the … by giving it to the party or agent personally; or if an address for service for the party or agent is stated in this agreement, then by leaving it at the address, or sending it by prepaid post as a letter to the address.

Notices may also be given by facsimile or by email depending on the individual tenancy agreement.

If there is no stipulated address for service for the debtor tenant, the tenant’s address for service is taken to be the address of the rental property.

TIP – We suggest sending the notice by express post.  This will provide the landlord with a time and date that the notice was delivered (and therefore given) to the debtor tenant.

Time for Compliance with Notice

The time that a debtor tenant has to comply with notices given pursuant to the Act, including the notice to remedy breach and the notice to leave, must be from the date that the notice is given.

The date that the notice is given is different from the date that the notice is issued!

Time for delivery by Australia Post must be accounted-for in the time for compliance.

In Marsellos Pike Real Estate v Bate [2014] QCATA 316 Senior Member Stilgoe OAM was required to decide on appeal if the correct time had been given in a notice to remedy breach, and if the tribunal had the power to waive compliance with the provisions of the Act.

The appeal jurisdiction of QCAT decided:

Section 328 of the [Act] states that the period for remedying a breach of tenancy must not end earlier than seven days after it is given … ‘issued’ is not the same as ‘given’.

This means that the time starts from the date of delivery, and not the date of issuance.

This is important because the notice to remedy breach requires a date for the tenant to remedy the breach to be included in the form.

TIP – As well as sending by express post, we suggest giving the tenant a few days extra for compliance with the notice.

For example, if you post the notice by express post on 1st of the month – the notice will likely be delivered on 2nd of the month – the date for compliance is therefore by 9th of the month.

We suggest giving them until 11th or 12th of the month – just in case.

Or, if the tenancy agreement allows for it, facsimile or email on the same day.  If you do email, then request a delivery receipt and a read receipt.

The appeal jurisdiction of QCAT also decided:

QCAT has no discretion to waive the requirement of seven days’ notice. The learned Adjudicator pointed out that notice period in s 328(1) of the Act is mandatory. Section 349 does not allow the tribunal to cure defects in a notice to remedy breach, only a notice to leave.

It is very important that the notices are completed and served correctly, or it could cause fatal problems down-the-line.

Urgent Application to QCAT

If you have ticked all of the boxes above, and the debtor tenants do not leave the property, then you are able to make an urgent application to QCAT.

The Act defines an application as an urgent application if the application is because of a failure to leave the property.

Section 415(1)(a) of the Act says:

An application to a tribunal is an “urgent application” if it is an application for a termination order made because of – a failure to leave.

The prescribed form for an urgent application is a QCAT Form 2 – Application for minor civil dispute – residential tenancy dispute.

You will need to file and serve the application on the debtor tenant.

Both parties are required to attend at the hearing of the application and a decision will be made by a member of the tribunal.

The decisions that can be made for rent arrears include:

1. Termination Order;
2. Money Order for the Unpaid Rent;
3. Warrant of Possession; and
4. Compensation for Failure to Leave.

For more information of QCAT applications, see QCAT Applications.

Termination Order

A termination order is an order terminating the residential tenancy.

Section 293(1) of the Act says:

The lessor may apply to a tribunal for a termination order because – (a) the lessor gave a notice to leave the premises to the tenant; and (b) the tenant failed to hand over vacant possession of the premises to the lessor on the handover day.

Section 293(2) of the Act says:

An application under this section must be made within 2 weeks after the handover day.

The application for a termination order must be made within two (2) weeks of the handover day.

If the tribunal makes an order terminating the tenancy, then the tenancy is over.

Money Order for the Unpaid Rent

As well as a termination order, the tribunal can make an order that the tenant pays to the landlord the amount of the unpaid rent arrears.

By that time, then rent arrears might be around two (2) or three (3) months’ rent.

If the tenant still refuses to pay the amount of the QCAT decision, then the landlord may attempt to enforce the monetary amount in the Magistrates Court (more below).

If the tribunal makes a termination order, then it also must issue a warrant of possession.

Alternatively, you might consider using a debt collector to collect unpaid rent.

Warrant of Possession

Section 351 of the Act says:

A warrant of possession must (a) authorise a police officer, or a stated authorised person, to enter the premises and give possession of the premises to the person in whose favour the termination order was made

A warrant of possession allows the landlord or the landlords agent to attend at the property and forcibly evict the tenant with the police if required.

The landlord or the landlords agent can then change the locks and look for new tenants.

Compensation for Failure to Leave

If the tenant remains in possession after the handover day and forces a landlord to execute the warrant for possession, then the landlord is entitled to claim compensation for any loss or expense and an occupation fee equal to the amount of rent that would have been payable.

Section 358 of the Act says:

If a tenant fails to hand over vacant possession of premises after a termination order is made by a tribunal, the lessor is entitled to receive from the tenant (a) compensation for any loss or expense incurred by the lessor by the failure; and (b) an occupation fee equal to the amount of rent that would have been payable by the tenant for the premises for the period the tenant remains in possession after termination of the agreement.

The landlord might be able to claim reasonable losses and expenses including:

1. Rent arrears;
2. Interest on the outstanding rent arrears;
3. Cleaning costs;
4. Repair costs;
5. Pest control fees; and
6. Filing fee for the application.

This section is to be read with the landlord’s duty to mitigate their losses pursuant to section 362 of the Act which says:

The lessor … must take all reasonable steps to mitigate the loss or expense; and is not entitled to receive compensation for any loss or expense that could have been avoided by taking the steps.

So, if a landlord has managed to get the tenant out of the property and has mitigated their reasonable losses & expenses (by getting new and better tenants for example), then all that might be left to do is to enforce the money decision of the tribunal.

Enforcement of a Money Decision

A decision in QCAT is enforced in the Court by registering a copy of the decision in the Magistrates Court, making it an enforceable money order.

Rule 793 of the Uniform Civil Procedure Rules 1999 (QLD) (“the UCPR”) says:

“enforceable money order” of a court, means (a) a money order of the court; or (b) a money order of another court or tribunal filed or registered under an Act in the court for enforcement.

Section 131 of the QCAT Act says:

A person may enforce the final decision by filing in the registry of a court of competent jurisdiction (a) a copy of the decision that the principal registrar has certified to be a true copy; and (b) the person’s affidavit about the amount not paid under the decision.

Once registered you have the choice of a number of different enforcement options.

Please read our content on enforcement of a registered QCAT decision here.

Rent arrears can have a huge impact on cash flow.  If you have tenants who owe unpaid rent then contact us immediately.  Our lawyers provide expert help with rent arrears and eviction of tenants

Problems with the Recovery of Rent Arrears

There are a number of different unique problems which occur when attempting to recover debts relating to unpaid rent or rent arrears.

Where is the Debtor Tenant?

One of the main problems encountered by landlords and/or their agents is that the debtors will often move and not provide a forwarding address.

Any of the available enforcement options will at some point need a process or a document to be personally served or served by pre-paid post.

If the debtor has left no forwarding address, then it may be difficult and/or expensive to try to find them.

Does the Debtor Tenant own any Property?

The fact that the debtor is renting probably means that they do not own any real property.

This is not always the case, the debtor tenant might have a rental investment property, but it is more likely than not that they do not own any real property.

Seizure and sale of property is a great way to enforce a debt for rent arrears against a debtor tenant.

Does the Debtor Tenant have a Job?

In some cases, the debtor tenant might not have a job and may have been getting rental assistance from the Government.

If the debtor tenant is not working, then it will be even harder to enforce a judgment against the debtor because a warrant for redirection of earnings will not be available.

The Debtor Tenant is a Person?

Because the debtor tenant is a natural person then the statutory demand process and winding-up / liquidation options are unavailable in the recovery of rent arrears.

Rent Arrears FAQ

This section attempts to answer the most commonly asked questions regarding the termination of a residential tenancy and the recovery of unpaid rent arrears.

What happens if your tenant stops paying rent in Queensland?

When a tenant in Queensland stops paying rent, the landlord must first issue a ‘Notice to Remedy Breach’ (Form 11) if the rent is overdue by 7 days. This notice gives the tenant a minimum of 7 days to pay the outstanding rent.

If the tenant fails to remedy the breach within this period, the landlord can then issue a ‘Notice to Leave for Unremedied Breach’ (Form 12), providing the tenant 7 days to vacate the premises.

If the tenant still doesn’t leave, the landlord can apply to the Queensland Civil and Administrative Tribunal (QCAT) for a termination order and a warrant of possession. This legal process ensures that landlords follow a fair procedure, respecting tenants’ rights while addressing rent arrears.

How long does it take to evict a tenant for non-payment of rent?

The eviction process for non-payment of rent in Queensland can vary in duration, depending on several factors. Initially, a tenant must be 7 days in arrears before a ‘Notice to Remedy Breach’ can be issued, which gives them another 7 days to pay.

If unresolved, a ‘Notice to Leave’ is issued, providing an additional 7 days. If the tenant still doesn’t vacate, the landlord must apply to QCAT for a termination order, which can take several weeks to process.

In total, the process can take from a few weeks to several months, depending on the tribunal’s schedule and any complications that may arise.

How do I evict a tenant for non-payment of rent without a lease?

Evicting a tenant without a formal lease in Queensland still requires adherence to the Residential Tenancies and Rooming Accommodation Act 2008. Even in the absence of a written lease, a tenancy agreement, whether verbal or implied, is recognised by law.

The process begins with issuing a ‘Notice to Remedy Breach’ for rent arrears, followed by a ‘Notice to Leave’ if the breach isn’t remedied. It’s crucial to document all communications and actions taken for legal compliance.

If the tenant fails to vacate, you may need to apply to QCAT for a termination order. It’s advisable to seek legal advice in such situations to ensure all actions are legally sound and the rights of both parties are respected.

Can I withdraw the notice if the tenant pays the rent arrears?

Yes, you can withdraw the notice if the tenant pays the rent arrears.  Section 333(1) of the Act says:

The lessor may withdraw a notice to leave for an unremedied breach given by the lessor if the tenant remedies the breach.

If you have had a reasonable relationship with the tenant until the breach, and the tenant remedies the breach before the expiration of the notice to leave, then the landlord can withdraw the notice and the tenancy continues as if the notice to leave had not been given.

The Tenant is claiming that the house was not fit to live in

It is common for a debtor tenant with rent arrears to make counterclaims against a landlord.  The test of whether a house is fit for the tenant to live in is determined by a reasonableness standard test.

In Fine v Geier [2003] QSC 73, Wilson J said:

Questions of fitness for habitation and repair are to be judged against a standard of reasonableness having regard to the age, character and locality of the residential premises and to the effect of a default on the state or condition of the premises as a whole

In Gray v Queensland Housing Commission [2004] QSC 276, Chesterman J said:

“…[N]ot every defect… will condemn a house as unfit. It is to be deemed to be unfit for human habitation if and only if it is so far defective…that it is not reasonably suitable for occupation in that condition…”.

So, unless the property is not reasonably suitable for occupation, or a landlord has failed to do what was required of them under the Act, then the landlord should be able to still claim for unpaid rent arrears.

What to do if tenant stops paying rent?

If the tenant stops paying rent, then the landlord needs to take the following steps:

1. Issue a notice to remedy breach;
2. Issue a notice to leave;
3. Application to QCAT for termination order;
4. If they do not leave, execute the warrant of possession;
5. Enforce the monetary decision in the Magistrates Court.

How long can a tenant not pay rent before eviction?

An estimate of minimum time frames are:

1. Seven (7) days unpaid rent allows for a notice to remedy breach;
2. One (1) day to serve the notice to remedy breach by express post;
3. Seven (7) days after giving notice for the tenant to remedy breach by paying rent arrears;
4. One (1) day to send notice to leave for unremedied breach by express post;
5. Seven (7) days for the tenant to leave;
6. If they do not leave, then approximately twenty-eight (28) days to get an urgent application in QCAT;
7. A further twenty-eight (28) days for the execution of a warrant of possession.

So best-case scenario, the tenants can be out in up to twenty-three (23) days.

The worst-case scenario, the tenant will be out in around seventy-nine (79) days or 11 weeks.

Does landlord have to accept late rent?

If the tenant pays the rent arrears within the time in the notice to remedy breach, then the landlord has to accept the rent.

If the tenant pays the rent after the notice to leave, the landlord does not have to withdraw the notice.  However, if the tenant disputes the notice then it will have to be shown that the issuance of the notice is reasonable in the circumstances.

Can a landlord sue for unpaid rent?

A landlord can sue for unpaid rent.

If the tenant remains in possession after the handover day and forces a landlord to execute the warrant for possession, then Section 358 of the Act says that the landlord is entitled to claim an “occupation fee” being equal to the amount of rent that would have been payable.

Can a landlord garnish wages for unpaid rent?

A landlord can only apply for an enforcement warrant for redirection of earnings after QCAT has made a money order, and that money order is registered in the Magistrates Court.

See our article about applying for an enforcement warrant for redirection of earnings.

How long does a landlord have to claim damages?

Section 293(2) of the Act says that an application under this section must be made within 2 weeks after the handover day.

If an application is made outside of this time then QCAT does not have jurisdiction to hear the application.

In Bergin v Department of Housing and Public Works [2013] QCATA 190 the QCAT appeal jurisdiction discussed whether QCAT had jurisdiction to (a) provide relief from the procedural requirements of section 293(2), and (b) if QCAT has jurisdiction after the two (2) week period.

Dr J R Forbes, Member held that QCAT could not extend the time and so QCAT does not have jurisdiction to hear an application if filed outside of the two (2) week time frame.  Dr J R Forbes said:

[T]he Adjudicator … inadvertently fell into legal error by purporting to exercise jurisdiction he did not possess. Consequently, leave to appeal … must be granted, the appeal allowed, and the order terminating the tenancy set aside.

Can a landlord charge a tenant for damages?

Yes. If the tenant has caused damage to the property other than fair and reasonable wear-and-tear, then the landlord is entitled to recover the cost of repair or replacement from the tenant.

Does a landlord have to prove damages?

Yes. Although the tribunal is not bound by the same rules of evidence as the Courts, it is good to rule-of-thumb to provide the tribunal with independent evidence to prove your claim.

If you are claiming that something needs to be replaced rather than repaired, provide an independent report from an expert (or someone who knows about that thing). 

If you are claiming some monetary amount for damages, then provide the tribunal with a couple of different quotes from independent sources.

This way the tribunal has something more to formulate their monetary decision on than just the word of the landlord.

Rent arrears can have a huge impact on cash flow.  If you have tenants who owe unpaid rent then contact us immediately.  Our lawyers provide expert help with rent arrears and eviction of tenants