Deciphering the Difference Between Form 18a Standard and Special Terms

Property Management,  Property Managers

The RTA-approved General Tenancy Agreement Form 18a is a standard agreement which forms part of the Residential Tenancies and Rooming Regulation 2009. Forming part of the regulation means the standard terms of the agreement cannot be altered and must be used in this format in all residential tenancy situations. Standard terms are law and not negotiable. Special terms are not standard terms and are negotiated between the parties to the tenancy agreement. It’s imperative these special terms do not contract out or void any provisions of the RTRA Act and Regulations or any other relevant legislation.

Property managers need to clearly understand that a tenancy agreement is a legally binding contract between the lessor (Item 1) and the tenant (Item 2). Commonly, the property manager completes and signs the document on behalf of the lessor.

Important note regarding special terms:

Due to amendments to the Legal Profession Act 2007 (LPA) that commenced 1 July 2008, Licensed Real Estate Agents and registered salespeople (which includes property managers) need to be careful to not unintentionally breach the LPA. Consequences can include hefty fines or imprisonment. Other legal consequences may follow.

The LPA recognises a property manager can prepare or complete a tenancy agreement by inserting information. However, when it comes to special terms, a property manager must be careful to ensure the proposed special terms meet one of the following criteria:

  1. It is authorised by a party to the proposed tenancy agreement (eg. lessor or tenant); or
  2. It is provided to the property manager in writing by a party (either the lessor or tenant) to the proposed tenancy agreement as an insertion or alteration to be included; or
  3. It was originally drafted by a lawyer and the property manager does not make a change to the wording other than to change a detail about the transaction or crosses out or leaves out an alternative or changes the grammatical form of words.

These amendments also provide that a POA licensee or employee must not give legal advice in relation to a property contract or other document such as a tenancy agreement.

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It’s important for property managers to know the extent of their role and the limitations on advice they’re qualified to provide in relation to special terms. The Realworks version of the Form 18a includes special terms which have been drafted by lawyers. Property managers using this version of the Form 18a need to familiarise themselves with these special terms and the lawful obligations of the lessor and tenant contained in these terms.

If a particular situation requires a more complex special term, the matter should be referred to a lawyer. If a special term is provided by a lessor, best practice is to ask the lessor to provide evidence that the term has been legally drafted to ensure it doesn’t contract outside the provisions of the RTRA Act and Regulations or any other relevant legislation. If the lessor will not (or cannot) provide this evidence, the property manager should seek independent legal advice before inserting the special term on the proposed Form 18a agreement.

REIQ Members seeking further advice on this topic or any other area of property management can call the PMSS Team on 1300MYREIQ (1300 697 347) or email pmsupport@reiq.com.au.  Not a member? Join us today!

Important disclaimer: This article is provided for general information only, and the author is not engaged to render professional advice or services through this article. Readers should satisfy themselves as to the correctness, relevance, and applicability of any of the above content, and should not act on any of it in respect of any specific problem or generally without first obtaining their own independent professional legal advice.

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