QLD property managers - be mindful of section 86 in regards to rent and breaches

I have been assisting Real Estate Excellence Members with a number of enquires about rent and breaches with the public holidays and office closures causing some headaches with rent. Be mindful of  below.

 

If you a member of Real Estate Excellence and would like further assistance on this matter or any other real estate matter, please contact me.

Thank you

Payment of rent by electronic transaction

 

Section 86 of the RTRA Act sets out when rent is deemed to be paid when the tenant pays rent electronically. If the tenant can prove when they paid rent, that day is deemed to be the day in which the rent was paid. For example; if the tenant paid rent electronically on Wednesday but the rent monies did not show in the trust account until Friday (on the agency bank statement), rent is deemed to have been paid on Wednesday.

The rent receipt however would show the date of Friday as the PAMD Regulations require that receipts be done for electronic payments when agencies become aware of monies. Never back date a trust account receipt.

This procedure is particularly important if a notice to remedy breach or a notice to leave has been given to a tenant between Wednesday and Friday such as on Thursday. Given the rent is deemed to have been paid on Wednesday; the notices are not valid and will be required to withdrawn in writing. Do not withdraw any notice such as a notice to remedy or notice to leave until there is definite evidence that rent has been paid (for example, the monies paid show on the trust account bank statement).

Encourage the tenant to pay a few days earlier, or an extra few days in advance to allow for electronic transfer. Although they are paying on a certain date, the tenancy ledger will show consistent late payments. This should be explained to tenants.

86 Payment of rent by electronic transaction

(1) This section applies—

(a) if a tenant effects an electronic transaction to pay rent to the account of the lessor or lessor’s agent on a day; and

(b) does not take any action to defer the payment to the lessor’s or lessors agent’s account to a later day.

(2) Payment is taken to be received by the lessor or lessor’s agent on the day the tenant effects the electronic transaction.

(3) Subsection (2) applies even if, because of circumstances beyond the tenant’s control, the payment to the lessor’s or lessors agent’s account happens on a later day.

Example—

The tenant uses BPay to authorise payment of rent to be debited to the tenant’s account on a Wednesday. However, the financial institution, because of its internal arrangements, does not actually debit the tenant’s account and credit the lessor’s or lessors agent’s account until the next day. The rent payment is taken to have been received by the lessor or lessor’s agent on the Wednesday.

 

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