Win for tenants – landlords must pay their own property taxes and council charges

In a recent case that went to VCAT, the tenants argued against a clause the landlord included in their lease (tenancy agreement). The landlord was attempting to make it the tenants’ responsibility to pay some of the landlord’s taxes and council charges.

But according to the law – Residential Tenancies Act 1997 (Vic) – when it comes to property costs, the only things tenants have to pay for other than rent are the charges for utilities such as electricity, gas, and water. And only if the rented home has separate meters for these services.

In this case the landlord applied to VCAT to claim part of the tenants’ bond to pay for garbage and fire service levy charges for the rented property. Tenants Victoria assisted the tenants to make a counter-claim requesting the bond be returned in full.

The director of the landlord in this case had previously tried to make tenants pay for these charges in 2015. But VCAT ruled against him. Despite the previous VCAT ruling, the invalid clause was included again! VCAT ruled the clause inserted into the lease by the landlord was invalid because it attempted to impose additional costs on the tenant beyond those in the law.

VCAT dismissed the landlord’s claim and ordered the full bond be refunded to the tenants.

The decision in this matter has been published by VCAT. The case citation is: Hescon Holdings Pty Ltd v Musgrave (Residential Tenancies) [2019] VCAT 233 (18 February 2019).

The decision in the 2015 matter was also published by VCAT. The case citation is: Shafer v Bourke (Residential Tenancies) [2015] VCAT 874 (11 June 2015).