Heads of Agreement Checklist

Heads of Agreement

Checklist

• The Heads of Agreement should be dated and validly executed by both parties
  
  
• There should be an explicit statement that the Heads of Agreement is meant to be binding
  
  
• If an essential term is absent or uncertain, the agreement will be void for uncertainty or construed as incomplete, ie. the parties should have agreed the terms that are regarded as essential, for example:
  
  - In a simple Heads of Agreement to lease a building the following matters must have been agreed and should be accurately identified - the parties, the premises, the term of the lease, the rent or other consideration payable, review dates and rights of renewal
  
  
• In the above case there was express reference in the Heads of Agreement to matters "not agreed". The Court determined that the matters marked not agreed had such substantial financial implications for both parties that they were marked not agreed as an indication of their importance and were therefore essential terms.
  
  
• There should be a provision for agreement on outstanding issues to be reached by resort to an expert or an arbitrator or by another mechanism (in the above case, the Court determined that the matters not agreed were "of a kind which could not be expected to be settled for the parties by a Court or other third party" ie. the Court was unable to fill the remaining blank spaces.
  
  
• You should ensure that all documents that are referred to as "attached" to the Heads of Agreement are attached, and that the parties have initialled all amendments and the foot of each page.
  
  
• If there is a particular form of agreement to be entered into at a later date (for example, the Auckland District Law Society Lease), then this should be attached or clearly identified in the Heads of Agreement to avoid uncertainty.
  
  
• The Heads of Agreement should be clearly drafted in plain English and accurately reflect the intention of the parties with all the essential terms and conditions incorporated.

Write an Employee Reference Letter

How to write an Employee Reference Letter

There are a few simple guidelines for writing an effective reference letter.

Firstly if you don't feel comfortable writing the reference or don't feel you can't say anything positive about the person involved then its better to tactfully decline. It is far better for the individual to find another person who can provide a positive reference for them.

References should contain the following points -  CLICK HERE

What is Fair Wear and Tear

Are you being too tough on your tenants?

The basic definition for fair wear and tear is:

‘damage that occurs during normal use or something that happens due to aging’.

As a tenant wrapped up in day-to-day life little bumps and dints, some light scratches and a smattering of smudges are usually things which cannot be avoided. A complete list of employment contracts can be found here: Residential Tenancy Agreements.

BUT, what if you are the proud owners of an investment property and your tenants are leaving their mark on your asset? Just HOW much do you let them get away with?

Deciding on what is fair is a huge challenge that property managers have to face every time a tenant leaves a property.

The problem lies in the fact that the term 'fair wear and tear' is not specifically defined in the Tenancy Act or the Tenancy Agreement, so it is open to individual interpretation. Some landlords can be very hard on tenants and while they expect the premises to be perfect, it is important to be fair to the renters.

Things like wearing carpet, slight smudges on the walls, chipped tiles, holes in fly screens, marks on curtains and carpets, insects in light fittings or dusty window and door tracks can happen in a normal day, and, they can happen to anyone. Other important factors that should be considered are the number of tenants, the time of tenancy and the age of fixtures and fittings prior to their tenancy.

It is important to think about the normal signs that appear when a property has been lived in for a period of time. Allowances must be made for this when it comes time for the property inspection and checking off on the original ‘condition report’.

So why is comparing the ‘condition report’ to the current state of the property so important?

The purpose of the final inspection is to compare the current state of the property to the initial condition report completed by the tenants at the beginning of their stay. The legislation states that the tenant must leave the property in the same condition as when they entered, and any substantial damages will then have to be paid from their rental bond after they have vacated the premises.

Just a bit of simple common sense and understanding from both sides can prevent any disputes;

As a tenant you should take care of the property and try and leave it as you entered it or you may be liable for the costs involved for repairs. You may also lose the large ‘rental bond’ which you paid at the beginning of your stay.

As a landlord then understanding that little things happen when living in a property is important and allowances MUST be made, you must take into consideration the fair wear and tear factor. Of course if there are obvious signs of avoidable damage to the property then you should not have to pay for this yourself.

With this understanding the relationship between tenant and landlord can and should be a good one.

http://www.rpemery.com.au

COMMERCIAL SUBLEASE AGREEMENT

What a commercial leaseholder needs to do to Sub-Lease a Commercial property.

Here are some very important things you will need to know before entering into a Commercial Sublease Agreement.

WHAT IS A COMMERCIAL SUBLEASE? 

WHEN CAN I USE A COMMERCIAL SUBLEASE? 

WHAT’S THE DIFFERENCE BETWEEN SUBLETTING AND ASSIGNING A LEASE? 

HOW DO I ENTER INTO A COMMERCIAL SUBLEASE? 

WHAT NEEDS TO BE STATED IN THE SUBLEASE AGREEMENT?

CAN I SUBLET PARTS OF THE PREMISES?

For the answers to these questions please visit the RP Emery website