Singapore, with its tenancy agreement friendly infrastructure, is a significant player in the global financial industry, boasting classic airports and world-class architecture. Known as a melting pot of cultures, its residents are products of successful academia that strive to rank alongside prestigious Western schools and universities. Renowned for its high regard for values and family-friendly environment, Singapore also stands out for its small geographical size despite its abundance in several other areas.
Singapore is measured to have a total land area of 724.2 square kilometers. Comparing it to the City of New York, it is 170 times smaller. Thus, when it comes to the occupation of land, the government imposes strict regulations. The presence of a dense population did not also help since the problem of living space comes into the picture. Sharing of living space has become the common way of living in the country. Many Singaporeans are not real property owners but instead live under the umbrella of their landlords in a tenancy agreement scenario.
Given Singapore’s situation, tenancy agreement has gained substantial popularity. Tenancy is essentially the transfer of a property’s physical possession from a landlord to a tenant, subject to the terms and conditions stipulated in the agreement. In Singapore, tenancy takes two forms – lease and licenses. The former grants priority interest over the land and permits the tenant to transfer rights to a third party. Here, the tenancy agreement Singapore mandates a duration not less than a six-month period. Conversely, a license is an agreement imparting personal permission to occupy the premises for a shorter duration without assigning rights to a third party or providing the occupant with recourse against nuisance and trespass.
In Singapore, a tenancy agreement binds both the landlord and tenant, obliging them to adhere to its conditions. The Control on Rent Act1 serves merely as a guideline for shaping the tenancy agreement between the two parties. The associated duties, responsibilities, and rights of each party must align with the legal requisites. The tenancy agreement also enumerates the relief methods the landlord can resort to if the tenant defaults on their responsibilities. Given that landlords are chiefly affected by tenancy governance, adequate protection against penalties incurred due to tenant lapses is fitting. The following sections will look into the claims a landlord can recover from a defaulting tenant.
Early Termination of Occupancy
Premature termination of a tenancy agreement occurs when the landlord and tenant jointly agree to end the occupancy before the agreed-upon termination date. In such cases, it is necessary for either party desiring early termination to notify the other through a notice to quit. The notice to quit must be served before the actual early termination of the tenancy. The notice period varies depending on the tenancy’s length or payment frequency. Frequently, a 30-day period is preferred for serving the notice to quit.
However, a mutual decision does not always lead to early termination of a tenancy agreement in Singapore. In such cases, landlords may find themselves in a tight spot as the tenancy ceases to generate income, and finding a new tenant on short notice can be challenging. This is where the security deposit comes into play.
A security deposit is an amount given by the tenant to the landlord before occupancy, usually equivalent to one month’s rent. The deposit serves to protect against any damages or prejudice caused during the tenancy agreement. It commonly addresses the early termination of tenancy, helping landlords mitigate losses. The inclusion of such additional payment terms in the agreement is essential. The manner of retaining the deposit and its amount should be explicitly stated in the contract, thereby informing the tenant and safeguarding the landlord’s rights.
Eviction of Tenants
Like all agreements, a tenancy agreement could potentially experience fallout if a party commits a violating act or fails to fulfil a duty, consequently compromising the other party. Tenancy is not exempt from this, as parties may not always find themselves in the same situation as when they initiated the contract. Therefore, stipulating conditions pertaining to the eviction within a tenancy agreement is crucial as it safeguards the landlord’s rights to evict a negligent tenant.
Eviction is a drastic recourse for a landlord to resort to as it means to re-possess the property from the tenant without affording the latter of a substitute living space. Hence, the right to the eviction of the tenant must be exercised by the landlord with caution and in accordance with the provided grounds under the agreement. The agreement sets out the reason for which a tenant may be evicted. The common reasons are:
1. Violation of the tenancy agreement;
2. Failure and/or delay in payment of rental dues;
3. Causing damage to property; and
4. Conducting illegal activities.
If either one of the causes established in the tenancy agreement is breached by the tenant, the landlord must send a termination notice to the tenant. Termination notice will serve as a demand to the tenant to either fulfill its duty or prohibit acts that will render the landlord in prejudice. This notice will also provide that the tenant is given a specific period of time to vacate the premises if there is a failure to comply with the demand.
In case the tenant still fails or refuses to acknowledge the termination notice, landlords are advised to seek the expertise of a solicitor. The enforcement of the termination notice must be coupled with a court order. The court order must specify that the action of the landlord in causing the eviction of the tenant is favored. If the causation of the eviction is due to non-payment of a rental fee that is worth SGD$20,000 the claim must be launched to the Small Claims Tribunal. Any other amount must be launched to the Magistrate’s Court and District Court.
The court will give the tenant the right to pay the amount of the unpaid rental fee within 4 weeks, if the cause for eviction is due to non-payment, or to file a petition to resist eviction prior to the grant of application for enforcement of the order. The grant of the enforcement order will allow the landlord to ask for the issuance of a Notice of Eviction. The Notice of Eviction will inform the tenant as to the date and time to which he is mandated to vacate and surrender the property. The execution of the service will be officiated by the court’s Sheriff.
Upon the arrival of the designated date and time of eviction, the sheriff together with the landlord will by force enter and re-possess the property. The entry will allow the sheriff to serve the notice and assess the valuables within the property. The inventory of valuables is the basis of the things that will be subjected to auction. The proceeds will be used as the additional payment for the left arrears of the tenant. The landlord should then secure the premises of the property by changing all locks and refrain the re-entrance of the tenant. It is to be noted that the cost of the process of eviction is to be burdened by the landlord alone.
Writ of Distress in Singapore
In cases wherein the drastic measure of eviction is pending before the court and there is urgency on the part of the landlord to recover from the loss of income or damages incurred, the latter may opt to apply before the court a writ of distress in Singapore. The writ of distress in Singapore empowers the court sheriff to enjoin and seize the property of the tenant within the property and subject it to the auction. The value of the sale will be applied to the debts of the tenant. The coverage of the value of the sale will be for the claim of unpaid rent for up to 12 months and the sheriff’s fees and other expenses. The remainder will be given back to the tenant. If the tenant has abandoned the property at the time the writ is granted, it will serve as a grant for the repossession of the property. This is applicable if the tenant owes the landlord at least 2 months of rent.
The application must be filed before the court to which the application for enforcement of eviction is filed. The tenant will be given 5 days to make good on his debt otherwise the grant of the writ of distress in Singapore will be a certainty. The following properties may be subject to the writ of distress in Singapore:
1. Properties at the hands of the tenant at the time of seizure;
2. Tools and implements in existence;
3. Clothes and bedding;
4. Any property relating to the tenant’s work; and
5. Any property under the custody of the law.
The court may allow the tenant to file a stoppage of the auction provided that he will submit before the court the said application together with the list of items seized. Failure to do such will allow the court to base its grant on the application of the landlord. If in case the tenant removes the items, the sheriff has the power to locate the said displaced items within 30 days and recover them.
In summary, an aggrieved landlord is given by the law the chance to recover claims against the erring tenant as provided by the remedies abovementioned. It is important to note that this will be applicable if the manner of recourse is established in the tenancy agreement. Landlords must also be guided in the proper cause against the tenant for his actions to prosper. Therefore, it is highly encouraged that landlords should seek legal aid in pursuing their actions against erring tenants.