On 1 July 2013 amendments to the Residential Tenancies Act 1987 come into effect in Western Australia.  The amendments include significant changes and increased regulation of the process to be followed by a mortgagee in taking possession of premises that are subject to a residential tenancy.

Key concepts for mortgagees are:

  • Taking possession of premises that are subject to a residential tenancy is prohibited without a court order.  The maximum penalty has increased from $4,000 to $20,000.
  • A new prescribed Notice to Tenant of Proposed Recovery of premises by Person with Superior Title must be served on the tenant at least 30 days prior to commencement of proceedings for the recovery of possession of premises subject to a residential tenancy.
  • A new prescribed Notice to Vacate from Mortgagee to Tenant must be served on the tenant at least 30 days prior to taking possession.
  • After a Notice to Vacate is served the tenant is not obliged to pay rent for a period of 30 days after service of the Notice and the tenant may recover any rent paid in advance for that 30 day period.
  • A mortgagee now has an express right to reasonable access to the premises, on reasonable notice to the tenant, to market the property.
  • In unspecified ‘special circumstances’ a tenant can apply to the court for an order vesting a tenancy in that person as against the mortgagee even after the mortgagee has taken possession.
  • There are no transitional provisions and the new regulations take effect immediately on 1 July 2013 even if there is a judgment for possession obtained prior to the commencement date.

It is necessary for lenders and mortgage managers to review their processes for dealing with tenanted premises to accommodate these changes.