is a tenant application binding?

A residential tenancy agreement is a contract. Therefore when considering whether or not the landlord and tenant has entered into a residential tenancy agreement, there must be offer and acceptance, consideration and agreement on the terms of the contract.

The facts of Grant & Leichsenring & Pope Nitschke First National Real Estate [2016] SACAT 8 are as follows:

Applicants attended an inspection on 21 January 2016 and signed an application on the same day. On 22 January 2016 the agent sent an email to the tenants advising them of the landlord's approval and including the terms and conditions of the tenancy. The tenants then paid the amount requested in the email into the agent's bank account. The tenants then declined to sign the tenancy agreement at the sign-up appointment.

Held - the application form signed by the tenants DOES NOT constitute an offer. The application does not contain sufficient information about the terms and conditions of the tenancy to form the basis of agreement between the parties. It is an invitation to treat.

Held - the email of 22 January 2016 WAS an offer as the terms and conditions were clear from the email.

Held - the tenant's acceptance of that offer can be inferred from the payment.

Held - a binding agreement existed between the parties on the terms set out in the agent's email.

Moral of the story - be very clear before the tenant pays anything that you have made it quite clear to the tenant what the terms and conditions of the lease are. Otherwise, there is no lease and you will have to refund the lot.

Click here for the ruling.

 

So as a tenant, this happened to me, was offered a property to lease, made arrangements to pick up the keys that friday, then late on thursday, was told sorry the property has been leased through another agent and the keys already handed to the new tennant! Could not sign the lease earlier as that agent only wanted us to sign up on the day we took the keys. As it was only verbal offer, we couldnt do anything. This was in the 90s, so can happen the other way around too. Too bad i had only a couple of days to scramble to find a new place to rent... grrr. Anyhow. Until its signed nothing is binding.. and even if i would of signed something i still dont think i could of done anything because other tenants had already moved in due to a dual listing.