Free Personal Property Rental Agreement

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Personal Property Rental Agreement

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Your Personal Property Rental Agreement

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PERSONAL PROPERTY RENTAL AGREEMENT

THIS AGREEMENT (the "Agreement") dated this ________ day of ________________, ________

BETWEEN:



_________________________ of ______________________________________________
(the "Lessor")

OF THE FIRST PART

- AND -

_________________________ of ______________________________________________
(the "Lessee")

OF THE SECOND PART

(Lessor and Lessee are collectively the "Parties" and individually a "Party")

IN CONSIDERATION OF the mutual covenants and promises in this Agreement, the receipt and sufficiency of which consideration the Parties acknowledge, the Lessor rents the Property to the Lessee on the following terms:

  1. Definitions
  2. The following definitions are used but not otherwise defined in this Agreement:
    1. "Casualty Value" means the market value of the Property at the end of the Term or when in relation to a Total Loss, the market value the Property would have had at the end of the Term but for the Total Loss. The Casualty Value may be less than but will not be more than the original purchase price of the Property.
    2. "Property" means _______________________________________________________________________
    3. "Lease" means this Agreement.
    4. "Total Loss" means any loss of or damage that is not repairable or that would cost more to repair than the market value of the Property.
  3. Lease
  4. The Lessor agrees to lease the Property to the Lessee, and the Lessee agrees to lease the Property from the Lessor in accordance with the terms provided in this Agreement.
  5. Term
  6. The Lessee will rent the Property from December 3, 2022 until December 4, 2022.
  7. Rent
  8. The rent for the Property will be $_______________ (the "Rent"). The Rent will be paid prior to the Lessee taking possession of the Property.
  9. Delivery
  10. The Lessor will deliver the Property to _______________________________.
  11. The Lessor will bear the risk and cost of delivery.
  12. Use and Repair of the Property
  13. The Lessee will use the Property in a good and careful manner and only for the purpose for which it was designed.  The Lessee will comply with all of the manufacturer's requirements and recommendations respecting the Property and with any applicable law, whether municipal, provincial/territorial or federal, respecting the use of the Property.
  14. The following restrictions on use apply to the Property:
    __________________________________________________________
    __________________________________________________________
    __________________________________________________________
  15. The Lessee will, at the Lessee's own expense, keep the Property in good repair, appearance and condition, normal and reasonable wear and tear excepted.
  16. Loss and Damage
  17. The Lessee will be responsible for all risk of loss, theft, damage or destruction to the Property from any and every cause. If the Property is lost or damaged, the Lessee will continue to pay Rent and will put or cause the Property to be put in a state of good repair, appearance and condition.
  18. In the event of Total Loss of the Property, the Lessee will continue to pay Rent, will provide the Lessor with prompt written notice of such loss and will replace the Property with substantially similar, encumbrance-free property. If a similar property is no longer available, the Lessee will pay to the Lessor the Casualty Value of the Property.
  19. Surrender
  20. At the end of the Term or upon earlier termination of this Agreement, the Lessee will return the Property, at the Lessee's expense and risk, to the Lessor by delivering the Property to _______________________________.
  21. Insurance
  22. The Lessee will, during the whole of the Term and for as long as the Lessee has possession of the Property, take out, maintain and pay for insurance against loss of and damage to the Property for the full replacement value of the Property and will name the Lessor as the loss payee.
  23. The Lessee will, during the whole of the Term and for as long as the Lessee has possession of the Property, take out, maintain and pay for comprehensive general liability insurance against claims for bodily injury, including death, and property damage or loss arising out of the use of the Property.  The insurance policy will have limits of at least $______________, and will name the Lessor as an additional named insured.
  24. The insurance will be in a form and with a company that is reasonably acceptable to the Lessor.
  25. Taxes
  26. The Lessor will report and pay all taxes, fees and charges related to ownership of the Property as required by law.
  27. Indemnity
  28. With the exception of the gross negligence or wilful misconduct of the Lessor, the Lessee will indemnify and hold harmless the Lessor against any and all claims, actions, suits, proceedings, costs, expenses, damages and liabilities, including lawyer's fees and costs, arising out of or related to the Lessee's use of the Property.
  29. Default
  30. The occurrence of any one or more of the following events will constitute an event of default ("Event of Default") under this Agreement:
    1. The Lessee fails to pay any amount provided for in this Agreement within _________ days after same is due or otherwise breaches the Lessee's obligations under this Agreement.
    2. The Lessee becomes insolvent or makes an assignment of rights or property for the benefit of creditors or files for or has bankruptcy proceedings instituted against it under the laws of Canada or other competent jurisdiction.
    3. A writ of attachment or execution is levied on the Property and is not released or satisfied within 10 days.
  31. Remedies
  32. On the occurrence of an Event of Default, the Lessor will be entitled to pursue any one or more of the following remedies (the "Remedies"):
    1. Declare the entire amount of the Rent for the Term immediately due and payable without notice or demand to the Lessee.
    2. Commence legal proceedings to recover the Rent and other obligations accrued before and after the Event of Default.
    3. Commence legal proceedings for the return of the Property.
    4. Terminate this Agreement immediately upon written notice to the Lessee.
    5. Pursue any other remedy available in law or equity.
  33. Assignment
  34. The Lessee may assign this Agreement, the Lessee's interest in this Agreement and the Lessee's interest in the Property by providing the Lessor with prior written notice of the assignment, provided the assignment is a reasonable one to which a reasonable person in the circumstances of the Lessor would not object.
  35. The Lessor may assign this Agreement, the Lessor's interest in this Agreement and the Lessor's interest in the Property by providing the Lessee with prior written notice of the assignment, provided the assignment is a reasonable one to which a reasonable person in the circumstances of the Lessee would not object.
  36. Additional Documents
  37. Upon written demand by the Lessor, the Lessee will execute and deliver to the Lessor documents required by the Lessor to protect the Lessor's interest in the Property including, but not limited to, the documents necessary to register the Lessor's interest at the personal property registry.
  38. Entire Agreement
  39. This Agreement will constitute the entire agreement between the Parties. Any prior understanding or representation of any kind preceding the date of this Agreement will not be binding on either Party except to the extent incorporated in this Agreement.
  40. Address for Notice
  41. Service of all notices under this Agreement will be delivered personally or sent by registered mail or courier to the following addresses:

    _________________________: ______________________________________________

    _________________________: ______________________________________________
  42. Payment
  43. All dollar amounts in this agreement refer to Canadian dollars, and all payments required to be paid under this Agreement will be paid in Canadian dollars unless the Parties agree otherwise.
  44. Interest
  45. Interest payable on any overdue amounts under this Agreement will be at a rate of ________ percent per annum or at the maximum rate allowed under applicable legislation, whichever is lower.
  46. Interpretation
  47. Headings are inserted for the convenience of the Parties only and are not to be considered when interpreting this Agreement. Words in the singular mean and include the plural and vice versa. Words in the masculine mean and include the feminine and vice versa.
  48. Governing Law
  49. It is the intention of the Parties to this Agreement that this Agreement and the performance under this Agreement, and all suits and proceedings under this Agreement, be construed in accordance with and governed by, to the exclusion of the law of any other forum, the laws of the Province of  without regard to the jurisdiction in which any action or proceeding may be instituted (the "Governing Jurisdiction").
  50. Severability
  51. If there is a conflict between any provision of this Agreement and the applicable legislation of the Governing Jurisdiction (the "Act"), the Act will prevail and such provisions of the Agreement will be amended or deleted as necessary in order to comply with the Act. Further, any provisions that are required by the Act are incorporated into this Agreement.
  52. If there is a conflict between any provision of this Agreement and any form of Agreement prescribed by the Act, that prescribed form will prevail and such provisions of the Agreement will be amended or deleted as necessary in order to comply with that prescribed form. Further, any provisions that are required by that prescribed form are incorporated into this Agreement.
  53. In the event that any of the provisions of this Agreement are held to be invalid or unenforceable in whole or in part, those provisions to the extent enforceable and all other provisions will nevertheless continue to be valid and enforceable as though the invalid or unenforceable parts had not been included in this Agreement and the remaining provisions had been executed by both Parties subsequent to the expungement of the invalid provision.
  54. General Terms
  55. This Agreement may be executed in counterparts. Facsimile signatures are binding and are considered to be original signatures.
  56. Time is of the essence in this Agreement.
  57. This Agreement will extend to and be binding upon and inure to the benefit of the respective heirs, executors, administrators, successors and assigns, as the case may be, of each Party to this Agreement.
  58. Neither Party will be liable in damages or have the right to terminate this Agreement for any delay or default in performance if such delay or default is caused by conditions beyond its control including, but not limited to, acts of God, Government restrictions, wars, insurrections, natural disasters, such as earthquakes, hurricanes or floods and/or any other cause beyond the reasonable control of the Party whose performance is affected.
  59. Notice to Lessee
  60. NOTICE TO THE LESSEE: This is a lease. You are not buying the Property. Do not sign this Lease before you read it. You are entitled to a completed copy of this Agreement when you sign it.
  61. Financial Disclosures
  62. Cash Value of Property: $__________________.
  63. Value other than Rent paid or being paid to Lessor: $ in administrative fees.
  64. Total cost of Lease (Rental): $__________________.

IN WITNESS WHEREOF the Parties have executed this Agreement on this ________ day of ________________, ________.



_____________________________
_________________________



_____________________________
_________________________

Last updated November 15, 2022

What is a Personal Property Rental Agreement?

A Personal Property Rental Agreement is a contract made between the owner of an item and someone renting the item for short or long-term use. The owner is called the lessor and the renter is called the lessee.

People mostly associate rental agreements with real property (i.e., real estate and land). However, all sorts of personal property can be rented. It’s important to note that this agreement is only suitable for personal property—not real property.

To rent real property, use a Residential Lease Agreement or Commercial Lease Agreement.

When should I use a Personal Property Rental Agreement?

You should use a Personal Property Rental Agreement when renting out personal property items, such as:

  • Vehicles
  • Trailers
  • Bicycles
  • Furniture
  • Instruments
  • Clothing
  • Jewelry

A Personal Property Rental Agreement can be useful for rental arrangements between friends, family members, or acquaintances. In addition, either party can also be a corporation or organization.

If you’re renting out a piece of equipment, an Equipment Rental Agreement may be better suited to your situation.

Why is it important to use a Personal Property Rental Agreement?

Written contracts are superior to verbal agreements in most situations. It’s no different when renting your personal property to others.

Using a Personal Property Rental Agreement:

  • Prevents misunderstandings and miscommunications
  • Creates written documentation of the rental terms
  • Clarifies the obligations of both parties
  • Defines expectations
  • Proves both parties agreed to the rental terms

What’s included in a Personal Property Rental Agreement?

Our Personal Property Rental Agreement asks you to include the following details:

1. Owner and renter information

There are two parties involved in a Personal Property Rental Agreement:

  • The lessor is the owner of the property.
  • The lessee is the party who is renting the property.

A complete rental agreement needs to include each party’s name and address. If either party is an organization, it must be specified.

2. Property details

A Personal Property Rental Agreement needs to include a description of the property being rented. Depending on the property, a description may include things like a brand name, model, colour, serial number, or date of manufacture. A description should also specify whether the property is new or used.

Also, the agreement should specify the property’s cash value. In most cases, the cash value is an estimate of what the property is worth at the time the contract is made. This amount may not be the same as what the owner paid to acquire the property.

3. Lease term and dates

The lease term is the duration of the Personal Property Rental Agreement. With our template, you can choose from the following options for a lease term:

  • Fixed term
  • Daily with automatic renewal
  • Weekly with automatic renewal
  • Monthly with automatic renewal
  • Yearly with automatic renewal

Automatic renewal means that the lease continues indefinitely for the agreed-upon time period (daily, weekly, monthly, or yearly) until either party wants it to end.

For automatic renewals, parties may have to provide each other with notice to end the agreement. If so, the terms should outline the notice required to terminate the lease.

4. Rental costs

A Personal Property Rental Agreement needs to specify a rental amount and when it will be paid. Our template allows you to choose from the following options:

  • Lump sum upfront
  • Weekly
  • Monthly
  • Yearly

Also, a renter may have to pay a damage deposit (also called a security deposit) to cover potential repair costs resulting from any damage they cause. If the owner collects a damage deposit, the agreement must specify the amount.

5. Delivery details

Delivery refers to the physical possession of the personal property being given to the renter.

A Personal Property Rental Agreement should specify:

  • Who will deliver the property
  • Who pays for delivery, if there are delivery costs

6. Restrictions on property use

The owner has the option of restricting how the renter uses the property. For example, if you’re renting your car to a friend, you may want to restrict them from using the car as a ride-share vehicle. If you don’t include any restrictions, then your friend can use the car as they see fit.

7. Return of property

When the rental term ends, the property has to be returned to the owner. The parties are free to decide how the property will be returned.

Either the owner can retrieve the property from the renter, or the renter can deliver the property back to the owner. The Personal Property Rental Agreement should specify who is responsible for the return or retrieval.

8. Insurance

The rental agreement should specify if the renter will obtain insurance for loss or damage to the property. In some cases, it’s strongly advised renters obtain insurance. For example, if the item is monetarily valuable, such as a car, insurance may be a good idea.

Also, the rental agreement should specify if the renter will obtain insurance for public liability and property damage. Usually, renters only have to obtain this type of insurance if the rented property can conceivably cause damage to other people or property, such as a vehicle.

9. Taxes

A Personal Property Rental Agreement should specify if the renter will pay taxes and fees levied against the property, such as Goods and Services Tax (GST).

The renter is only responsible for paying taxes and fees that are included in the rental agreement or that are required by law to be paid by them.

10. Default period

A grace period is a period of time during which a payment can be made after its due date without incurring a late penalty. If the owner is allowing a grace period for failure to pay rent, the Personal Property Rental Agreement should outline its length (i.e., a specific number of days).

11. Assignment permissions

An assignment transfers a party’s rights and obligations to a third party. The assigning party gives up their rights under the contract to the third party, who becomes a party to the contract.

Suppose someone rents a vehicle for a one-year lease term but stops driving five months into the contract because they’re injured. In this case, they may be interested in assigning the contract to their spouse, so they can continue using the vehicle.

Usually, a renter cannot assign a lease unless the Personal Property Rental Agreement clearly states that they have the owner’s permission. To clarify whether either party is allowed to assign the lease, the agreement should contain clear assignment rights.

12. Overdue fees

A Personal Property Rental Agreement should specify whether a renter has to pay a penalty if a rent payment is overdue. A penalty may come in the form of a fee or interest.

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