Court Determination of Rent

In leases of residential property or roofed commercial premises, a rent determination action allows a court to set the applicable rent. It does not allow a landlord to choose any amount unilaterally. The renewal date, length of the tenancy and statutory criteria all matter.

For tenancies that have not exceeded five years, increases for renewed terms are subject to mandatory legal limits. Once a tenancy has exceeded five years, or has been renewed after that point, the court considers the property's condition, comparable rents, economic indicators and fairness. An advertised rent in the same district is not automatically a valid comparison: size, age, use and location must also be considered.

The filing date can affect the rental period from which the determined amount applies. Filing before the new term begins, or sending a timely written notice, may be important. An agreed rent-increase clause can also change the assessment. Dates should therefore be checked against the particular lease.

Since 1 September 2023, applying for mediation before bringing a lease dispute to court is generally a procedural requirement. The lease, payment history, written notices, property documents and information about comparable rents can help the parties assess the matter.

This article is for general information only. The legal assessment may differ according to the facts of a particular case.