Can Landlords charge Double Rent?

How can Landlords charge double rent?

Double rent refers to a compensation amounting to twice the monthly rent, imposed on a tenant who fails to vacate the premises after the expiration of their tenancy.

As a landlord, you may wonder about your options if a tenant remains on your property beyond the expiry of their tenancy. While legal action to recover possession or evict the tenant is possible, this process can be both time-consuming and costly. However, this does not mean you should allow the tenant to hold over the property at the regular rental rate. If handled correctly, you can charge double rent to a holding-over tenant.

Legal Basis for Double Rent

Section 28(4) of the Civil Law Act 1956 states:

“Every tenant holding over after the determination of his tenancy shall be chargeable, at the option of his landlord, with double the amount of his 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.”

This provision aims to deter tenants from overstaying their welcome after their tenancy expires. However, many landlords fail to claim double rent because it is often unclear whether the tenant had permission to remain. Therefore, it is prudent for landlords to provide written notice to tenants to vacate the premises, including a warning that failure to do so will result in double rent being charged.

Case Study: Rohasassets Sdn Bhd v Weatherford (M) Sdn Bhd & Anor

A significant case on this matter is Rohasassets Sdn Bhd (formerly known as Wisma Perkasa Sdn Bhd) v Weatherford (M) Sdn Bhd & Anor [2020] 1 MLJ 557. The Federal Court held that double rent is chargeable only when tenants hold over without the landlord’s consent, whether express or implied. It clarified that double rent is not automatically applicable after expiry of tenancy.

In this case, the Federal Court found that the landlord had given tacit approval to the tenants to remain on the land pending negotiations and did not clearly indicate that it wanted the tenants to vacate the premises post-tenancy expiry:

• Intent to Renew: Negotiations indicated Rohasassets intended to renew the tenancies.
• Acceptance of Regular Rent: Rohasassets accepted regular rent during negotiations without complaint, despite reserving the right to charge double rent.
• No Notice to Quit: No eviction notice was issued until negotiations failed.
• Thus, during the negotiations, the tenants were considered tenants at will rather than trespassers. Rohasassets waived its right to claim double rent through its conduct.

Conclusion

If you intend to charge double rent and require the tenant to vacate the premises, always provide written notice. Clearly state the intention to impose double rent if the tenant continues to occupy the property. This approach ensures that there is no ambiguity and reinforces your legal right to claim double rent.

By following these guidelines, landlords can better protect their interests and enforce their rights under the Civil Law Act 1956.

Author: Patrick Tan, Partner the firm

patrick@tnhlaw.com.my

Disclaimer:

This article is intended for informational purposes only and does not constitute legal advice. Every situation is unique, and specific legal advice should be sought based on the particular circumstances. Readers are encouraged to contact us at Tang Hong & Lock if they require legal advice or have any questions regarding the content of this article.