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A landlord-tenant relationship is a contractual relationship with each having mutual rights and duties. Thus, it is of utmost importance that both the parties to the contract conform to it, to prevent any breaches and damages.

Common Disputes Between Landlord And Tenant

As is the nature of any relationship, it is likely that disputes may arise between a landlord and a tenant. Some of the most commonly occurring legal disputes are as follows-

1. A landlord serves a notice to the tenant under section 106 TPA to vacate the premises as the lease has ended due to efflux of time and the landlord does not wish to extend it. If the tenant refuses to move out, the landlord has to initiate eviction proceedings.
2. When the tenant, before vacating the premises, has not served a proper notice to the landlord as stipulated by the lease agreement, causing a breach.
3. If the landlord refuses to handover the rental deposit that he had taken at the time of renting out the premise to the tenant is also a breach of the lease agreement.

The above points be understood better through these scenarios which commonly occur in our day to day life-

Scenario 1

• The 4th floor of a building has been constructed authorised and has been rented out by a landlord. A tenant rented the place in good faith assuming that clearances are in place for the premises to be let out on rent. In the midst of the lease period, authorities like power, water or municipal disconnected their supplies, rendering the premise unfit to live, thus forcing the tenant to vacate before the lease period is over, without giving a notice. As the tenant vacated the premise without giving a proper notice, the landlord refuses to give back the rental deposit leading to a dispute.

Scenario 2

• A premise rented out for residential purposes is being misused by the tenant for commercial purposes. In such a case, the landlord forcibly evicts him. The landlord takes notional possession and subsequently locks it, thereby not allowing him to enter the premises. All the personal belongings of the tenant in the premise are retained by the landlord. As the tenant has been evicted out of the premise before the lease period, unpaid rentals have to be settled by the tenant which he may refuse to give leading to a dispute.

In light of the above two illustrations, it is clear that there can be disputes between a landlord and tenant for various reasons. Moreover, there are chances that such disputes may reach any level of risk or remain unsolved forever, if there is no prior legal binding. So, what do you think should be done in such a context?

Either party may initially serve a notice to each other giving them sufficient time to undo the breaches to the agreement. After this, the parties may hold negotiations or discussions for the losses caused to them due to the breaches committed and they need to be sufficiently compensated for the same. A positive outcome of these negotiations and discussions is a Rental settlement agreement.

What Is A Rental Settlement Agreement?

A rental settlement agreement comes into play when there has been a dispute between a landlord and tenant, or anybody authorised on their behalf. Either party may commit a breach of the agreement entered into. The parties may then give a notice or initiate a case against each other to settle their claims. Their claims can also be settled through mutual agreement also. The parties may then draw up a settlement agreement to settle their disputes.

What Does A Rental Settlement Agreement Include?

The rental settlement agreement basically states that the landlord and tenant or anybody authorised on their behalf have come to terms and decided to settle their dispute mutually. Some of the important clauses in this agreement include-

• No future claims shall be made on the same subject matter of the current dispute.

• The settlement agreement supersedes all prior agreements, negotiations or understandings.

• No admission of liability i.e. whatever admissions are made during the negotiations shall not be used in the future.

Thus, a rental settlement agreement is a decent way of settling disputes whether one is a landlord or a tenant. You may also check out our article on how to terminate a rental agreement.