Rental Agreement: What to include in a Rental agreement

Most important clauses for any rental agreement in Kenya
Rental or lease agreements in Kenya, should be framed with the aim of creating a mutually beneficial relationship and avoiding disputes between the tenant and the landlord. We look at the important clauses that such agreements should cover

Peris, moved into a two-bedroom apartment in Nairobi. However, after two months of their stay, they started noticing problems with the plumbing and electrical wiring in the apartment.When she raised the issues with her landlord, the landlord simply denied any help and asked her to pay for the plumbing and wiring repairs, from her own pocket. Peris had failed to read the fine print in the agreement which had a clause that was slightly tweaked to favour the landlord.

Dos and don’ts while drafting a rental Agreement
The rent agreement, a document that seals the arrangement between a landlord and the tenant, is a potent instrument that can be used and misused.The rent agreement, if formalised properly, helps the landlord and the tenant, and results in a good healthy relationship between the two. However, it should be formalised with all the provisions and necessary laws.

Important clauses for tenants
Provisions relating to your tenure of stay (tenancy period), the frequency and date of rent payments, the time of renewal of your lease and the provisions for repair and maintenance, should be clearly mentioned in the agreement. In addition to these, the roles and responsibilities of the tenant and the landlord should be defined. “It is advisable to take the property on rent, after all repairs and maintenance. One should also check the wiring and plumbing, before occupying the flat. This way, the tenant will safeguard himself from unnecessary expenses that may crop up in future.”

It is also important to check on pending dues, such as electricity.
Rental agreements should also clearly state the amount/consideration paid as booking amount (or security deposit) and as advance, in the agreement.The mention of arbitration clause, is also equally important. If your landlord is providing a furnished flat, it isin your interest to list the items, furniture or goods in the house. Any loss or repair needed, can then be easily established towards the end of your tenancy.

Important clauses for Landlords
A landlord’s biggest worry is that the property can be usurped or illegally occupied by an errant tenant. For this reason, the rent agreement should be registered.It is also important to sign theagreement, in presence of two known witnesses. Due to worsening law and order situation in metros, the policeoften insist on verification of tenants. Landlords can also ask for a copy of employmentletter from the tenants’ employer. However, this should not be a yardstick of anyone’s character. Landlords should insist on police verification, for tenants who are foreign nationals or those who are not natives of that city.

How can tenants and landlords frame the agreement?
In general, most lawyers who assist in framing the rent agreement, have a ready template. This doesn’t mean that you cannot change the provisions. You can also tailor the agreement to suit your needs, with clauses that are mutually acceptable to the tenant and the landlord

What questions should be answered about rent?
Some of them are these. Whatis the term of the lease? What is the monthly rent? In what currency is the rent payable? Isthere escalation rate if the tenancy period is long? In what mode should the rent be paid? To whom should the rent be paid? By which date should therent be paid? What happens if Government levies taxes on rent? What is the delinquency charge for late rent payment? What is the percentage of the delinquency rate? What other remedies are available for rent delays?

Maintenance and Repairs
Some maintenance costs are entirely the responsibility of the landlord while other repair costs might fall on the tenant. The tenancy agreement should clearly stipulate these distinctions.“Normal repairs like fixing  broken window panes or spoiltdoor knobs  are the responsibility of the tenant, but if it is something to do with the structure, for exampleif it has cracks on the wall, it isthe obligation of the landlord.

The tenant should make payments on utilities while land rates paid annually to the central and county governments are entirely the obligation of the landlord. However, due to the prevailing economic conditions, some landlords h pass  on these extra costs to their tenants.

Enjoyment of Property
As a tenant you have the right to privacy. However, there have been instances where landlords or their agents have invaded their tenants’ privacy by visiting them at odd hours or denying them some privileges. According to the tenancy agreement, if the tenant is paying rent and has not contravened any terms on the lease, they should be allowed enjoyment of the premise.“As long as you are not in breach of your agreement, the landlord or their agent cannot just walk in at midnight and say, ‘I want to find out what you are doing.’ You should be allowed to enjoy the premises without undue or unreasonable disturbance by the landlord

Inspection of Premises
The tenancy agreement should have a provision on  the inspection of the premises. Unless there is an emergency, the landlord and his agents should give the tenant notice a 48-hour prior to the inspection.

Rent Increment
IF there is a disagreement, the tenant can engage a rent tribunal, which looks at the balance between the economic circumstances of the tenant and the  landlord’s need to get a return on his or her investment.  But generally, rent increments should be in line with the country’s inflationrates.

Termination of the Lease
If the tenant defaults on the rent, the landlord has the right to terminate the lease. However, the landlord should give notice before taking any action. “The standard  is three months, so if you don’t carry out the necessary repairs within the notice period, the landlord can terminate the lease, carry out the repairs andrecover the cost from the security deposits, and refund you any balance.If the deposit is not enough to cover the defaulted amount, the landlord can have the tenant’s property auctioned. However, they must give you atwo-week notice, during which,if  you make payments, they shouldn’t take any further action. But if you don’t, the auctioneers can come for yourproperty. If they find the premises locked, they should obtain a break-in order from the court. They should also advertise your property before disposing of the to give you a chance to reclaim it.

Conclusion
Start addressing tenancy questions from the moment you get interested in leasing a property. Discuss the monthly rent, length of tenancy, security deposit. The list is endless. Don’t forget to agree on how to resolve disputes arising from the tenancy. Bealert on wording of the covenants during drafting and signing of the agreement, particularly if prepared by theother party.Make sure that any weighty verbal agreements are captured in the written agreement. The obligationsof both parties should be explicit unless implied by law. Some of the questions, which should be answered about repairs and maintenance include, but is not limited to the following. Who is responsible for structural repairs? Who isresponsible for running repairs and maintenance?How should theparties responsible for these repairs be alerted and informed if such repairs are needed? What period is espoused to construe a notice as having been received by the receiving party?What time period is provided for each party to remedy any defect, which istheir responsibility? At what stage can one party repair what is another party’s responsibility? How can one recover the costs?

It is also important to keep a record of your rent payments to avoid future disputes.