What happens to a rental agreement when a flatmate dies?

There are special rules regarding what happens when a renter dies. These apply to what happens when the rental agreement (lease) ends, what happens to the bond and what happens to a renter’s belongings. A legal representative of the deceased, such as an executor or next of kin will usually manage these affairs and deal with other parties to the rental agreement.

What happens to the rental agreement?

If more than one renter has signed the rental agreement, they are co-renters, also known as joint renters or tenants. If a tenant dies, this does not automatically end the rental agreement. The remaining tenants’ rights and responsibilities under the tenancy agreement continue, while the same contractual obligations under that agreement are passed to the executor of the deceased estate. This means that the executor becomes responsible for the deceased tenant’s obligations under the agreement, such as paying the rent. If the executor does not want to continue renting the property, they need to adhere to the relevant State’s procedures for negotiating an end to the lease and returning the bond.

What happens to the bond?

If a renter who is registered as a joint bond-holder dies, their share of the bond passes to the surviving co-renter(s).

The bond can also be released, transferred or claimed by the deceased renter’s estate. In order to do this, a residential tenancies bond authority (or equivalent) may need to see the following documents:

• A bond claim form or rental transfer form, completed and signed by both the rental provider and the surviving co-renters.
• Proof of death, such as a full death certificate, an interim death certificate issued by the coroner, an invoice from the funeral director, or a grant of probate or letters of administration.
• A statutory declaration.

The bond can be used to pay for repairs or cleaning to return the property to its original condition if this is required, but the usual bond rules apply.

What happens to the belongings left behind?

Responsibility for removing belongings from the rental also falls to the executor as the deceased’s property transfers to their estate or next-of-kin. This means that the executor must be provided access to the rental premises so that they can carry out their responsibility of returning vacant possession (clearing the previously occupied room or tenancy to a vacant condition), dealing with the tenant’s possessions and arranging any cleaning of the property (specialist or otherwise). 

The rental provider (landlord) cannot remove any items from the rental or take immediate possession of the property. If there is no next-of-kin, the executor will have to refer to State procedures for dealing with abandoned tenant property.

What about if the rental provider dies?

If a rental provider, homeowner or landlord, dies, the rental agreement does not automatically end either. There will usually be a representative or administrator for the rental provider who takes on their rights and responsibilities. This means that they are legally bound to do what is stated in the rental agreement.

In terms of the bond, the process for claiming or transferring is different depending on whether there was only one rental provider or more than one.

Moving on

Once vacant possession is returned the property can be advertised for rent. For rental providers, it is important to keep written evidence of the advertising activity associated with the re-letting, including dates listed, costs and commencement date of the new agreement. 

It is also important for all parties to abide by the rules around handling tenant deaths at rentals such as those related to terminating leases, returning bonds and disposing of renter possessions. This will go a long way to minimise financial losses, legal ramifications and other unnecessary burdens on top of the emotional toll that the passing of a flatmate can take, so that everyone can move forward.

If you need help with an application for a grant of probate or letters of administration, the team at Willed can help. 

Disclaimer: The content of this blog is intended to provide a general guide to the subject matter. This blog should not be relied upon as legal, financial, accounting or tax advice.