By Guest Expert May 26, 2023

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Can a landlord or agent be sued for negligence?

Property Investment
Can a landlord or agent be sued for negligence?

Can a tenant sue an agent or landlord for negligence?

In a word – yes.

Negligence.

It’s a word that doesn’t have a nice ring to it.

It’s kind of ominous – and for good reason.

If a tenant is using the words ‘negligence’ or ‘negligent’ when referring to their landlord or property manager, they aren’t paying a compliment.

There’s actually a good chance that the person to whom they are referring will be the one paying – not compliments but potentially compensation.

Let’s dig deeper…

So just what is negligence?

Put simply, negligence is when someone owes you a duty of care but has failed to act according to a reasonable standard of care and this has caused you injury.

The negligent behaviour can be a result of either an act or a failure to act.

Yes, it sounds like legal-speak but it’s also insurance-speak.

Why?

Because negligence is tied to liability and legal liability is something that you can often protect against with insurance.

So what’s legal liability then?

Liability is basically a person’s obligation or responsibility, under law, to compensate another person if their negligence led to that other person suffering a loss, such as injury or damage to their property.

When it comes to rental properties, both landlords and agents have a duty of care to protect others from loss.

Duty of care means ‘an obligation to take reasonable care to avoid foreseeable harm to another person on their property’.

Landlords owe a duty of care to their tenants and to anyone else who is on their property, such as guests of the tenant, tradies or even the grocery delivery person.

Where agents are concerned, they have a duty of care to their landlord clients in addition to tenants and visitors of the property.

Note: Tenants also have a duty of care to anyone present on the property. It’s called occupiers’ liability and tenants should take out insurance to protect themselves.

What are the landlord’s/agent’s obligations?

The duty of care owed by the landlord to tenants and anyone invited onto the property relates to ensuring that the property is safe.

The landlord and/or agent may be held legally liable if an injury or death occurs, or a person’s property is damaged or lost, as a result of the landlord’s failure to ensure the rental premises are safe.

An agent may also be held liable if it is found that they were negligent in their duties too, for example by not notifying the landlord of a safety issue at the premises or failing to make it safe.

Landlords and agents have a responsibility to ensure that the rental meets applicable state health and safety laws.

This means landlords must take reasonable care to avoid the foreseeable risk of harm to their tenants and others at the property.

Each state and territory has safety requirements that must be met.

While the legislation in each jurisdiction may differ (always refer to your state or territory law for specifics), in general obligations include ensuring:

electrical safety
working smoke alarms
gas safety
the structural integrity of the building
windows and balcony safety

working locks and security devices
pests and vermin are eliminated (if present at the start of the tenancy)
health-threatening issues such as rising dampness or mould are promptly rectified (if the landlord is responsible for its presence)
swimming pool and spa safety.

Further state-specific requirements that must be met related to building standards, fire safety standards, anchoring furniture, blind and curtain safety and maintaining appliances.

In addition, landlords and agents have an obligation to arrange for urgent repairs necessary to avoid exposing a person to the risk of injury.

Tenants also have some responsibilities. They must ensure the rental property remains a safe environment by:

not creating hazards by their actions
alerting the landlord or agent (usually in writing) to any safety issues around the home as soon as possible.

So what makes a landlord or agent negligent?

When it comes to negligence, the landlord’s duty of care includes responsibility for:

defects that existed at the time the tenancy commenced or was renewed, and
defects of which the landlord knows or ought to have known that arose during the term of the tenancy.

A landlord or their agent can be found liable for tenant injury at the rental property if the injury is the result of a dangerous condition or state of disrepair at the premises:

which had not been identified because the landlord or agent failed to conduct regular inspections, or
which they were warned of but failed to properly rectify within a reasonable time.

It should be noted that the landlord will not generally be held liable for injuries that are caused by a defect, hazard or condition that they did not know about and could not have reasonably known about.

Tenant

What should landlords do?

Landlords and agents need to be aware of their legal obligations (duty of care) and take steps to fulfil them, including:

addressing repairs
fixing safety hazards
providing essential services
complying with building standards and safety requirements
conducting regular inspections.

What happens if the landlord is negligent?

If a landlord or agent breaches their duty of care, the person who suffered a loss has avenues for recourse (legal remedies to recoup losses).

Depending on the applicable circumstances and legislation, the tenant may be able to withhold rent, pay for repairs and deduct the cost from their rent or terminate the lease.

Or they may haul the landlord or agent before a tribunal or court.

They may sue the landlord or agent for negligence.

If the actions or inaction of a landlord and/or agent results in a tenant or another person on the premises being injured or having their property damaged, the landlord and/or agent may be required to compensate the person who suffered a loss.

Claims for legal liability (also known as public liability or liability to others) can range from a few hundred dollars to millions.

The compensation will generally reflect the severity of the injury suffered.

Landlords may also have grounds to pursue their agent for negligence if they suffer a loss as a result of their agent’s action or inaction.

If found negligent, the landlord and/or agent are likely to be ordered to pay compensation.

They may also be required to pay the claimant’s legal costs in addition to their own.

How can landlords and agents protect themselves?

Negligence can take many forms and can sometimes lead to costly legal disputes between landlords, agents and tenants.

That’s why landlords and agents need to understand their legal obligations and potential risks.

It’s also why it’s important to protect yourself with the right insurance policy.

For property owners, a landlord insurance policy should include cover for legal liability.

Legal liability insurance provides the policyholder with protection against claims resulting from injuries and damage to people and/or property.

The policies cover both legal costs and any payouts for which the policyholder would be responsible if found legally liable.

Guest Author: This article was written by the team at EBM RentCover and was originally published here. EBM RentCover is one of Australia’s leading landlord insurance providers, protecting more than 150,000 rental properties across Australia.

About Guest Expert Apart from our regular team of experts, we frequently publish commentary from guest contributors who are authorities in their field.