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Case Update: Right of landlord to charge double rent from tenant

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LAND LAW
Tenancy agreement – Claim for double rent – Whether there is a requirement on the landlord to show wilful and contumacious conduct on the part of the tenant holding over to render the tenant liable to pay double rent

Rohasassets Sdn Bhd v Weatherford (M) Sdn Bhd & Anor
[2019] 1 LNS 1783, Federal Court
- see the grounds of judgment here

Facts The appellant is the registered owner of a commercial building (the ‘premises’) and had let out the premises to the first and second respondents. Before the expiry of the tenancies, which was almost 10 years later, parties began negotiations for renewal of the tenancies and it went on even after the expiry of the tenancies for more than two years. The appellant expressly reserved its right to charge double rent and consistently reminded the respondents both before and after the expiry of the tenancies to make payment but the respondents did not do so. The respondents knew of the appellant’s right to charge double rent and in fact pleaded for it to be waived, especially in the event of a renewal of the tenancies. This is evidenced by the correspondence between the parties and the meetings between the appellant and the respondents’ representatives. However, the negotiations for new tenancies failed and the appellant gave notices to the respondents to quit and deliver vacant possession of the premises by 1 October 2011. The respondents did not challenge the termination nor the notices to quit but took an additional one month to vacate the premises by delivering vacant possession only on 31 October 2011 although their request for extension was refused by the appellant. The learned High Court Judge dismissed the appellant’s claim for double rent and allowed the respondents’ counterclaims for a refund of the deposits. The Court of Appeal on the other hand allowed the appeal in part ordered the respondents to pay double rent but only for the period commencing from the expiry of the notices to quit up to the date of delivery of vacant possession, and not for the period commencing from the expiry of the tenancies in 2009 and 2011 respectively. Hence, this appeal.

Issues The main issue is whether if the tenant holds over after the expiry of the tenancy, is there a need for the landlord to prove wilful and contumacious conduct on the part of the tenant to entitle the landlord to charge double rent under section 28(4)(a)[1] of the Civil Law Act 1956?

Held The Federal Court held that although there is no requirement on the landlord to show contumacious conduct on the part of the tenant holding over to render the tenant liable to pay the said double rent under section 28(4)(a) of the Act, the appeal must stand dismissed as the respondents were holding over with the appellant’s consent and therefore in lawful possession of the premises for the period between the date of expiry of the tenancies and the date of expiry of the notices to quit. Accordingly, the Court affirm the decision of the Court of Appeal. 

ZUL RAFIQUE & partners
{15 January 2020}

[1] Every tenant holding over after the determination of his tenancy shall be chargeable, at the option of his landlord, with double the amount of rent until possession is given up by him or with double the value during the period of detention of the land or premises so detained, whether notice to that effect has been given or not.