New South Wales Consolidated Acts

RETAIL LEASES ACT 1994 - SECT 62B

62B Unconscionable conduct in retail shop lease transactions

(1) A lessor must not, in connection with a retail shop lease, engage in conduct that is, in all the circumstances, unconscionable.

(2) A lessee must not, in connection with a retail shop lease, engage in conduct that is, in all the circumstances, unconscionable.

(3) Without in any way limiting the matters to which the Tribunal may have regard for the purpose of determining whether a lessor has contravened subsection (1) in connection with a retail shop lease, the Tribunal may have regard to:

(a) the relative strengths of the bargaining positions of the lessor and the lessee, and

(b) whether, as a result of conduct engaged in by the lessor, the lessee was required to comply with conditions that were not reasonably necessary for the protection of the legitimate interests of the lessor, and

(c) whether the lessee was able to understand any documents relating to the lease, and

(d) whether any undue influence or pressure was exerted on, or any unfair tactics were used against, the lessee or a person acting on behalf of the lessee by the lessor or a person acting on behalf of the lessor in relation to the lease, and

(e) the amount for which, and the circumstances under which, the lessee could have acquired an identical or equivalent lease from a person other than the lessor, and

(f) the extent to which the lessor’s conduct towards the lessee was consistent with the lessor’s conduct in similar transactions between the lessor and other like lessees, and

(g) the requirements of any applicable industry code, and

(h) the requirements of any other industry code, if the lessee acted on the reasonable belief that the lessor would comply with that code, and

(i) the extent to which the lessor unreasonably failed to disclose to the lessee:

(i) any intended conduct of the lessor that might affect the interests of the lessee, and

(ii) any risks to the lessee arising from the lessor’s intended conduct (being risks that the lessor should have foreseen would not be apparent to the lessee), and

(j) the extent to which the lessor was willing to negotiate the terms and conditions of any lease with the lessee, and

(k) the extent to which the lessor and the lessee acted in good faith.

(4) Without in any way limiting the matters to which the Tribunal may have regard for the purpose of determining whether a lessee has contravened subsection (2) in connection with a retail shop lease, the Tribunal may have regard to:

(a) the relative strengths of the bargaining positions of the lessee and the lessor, and

(b) whether, as a result of conduct engaged in by the lessee, the lessor was required to comply with conditions that were not reasonably necessary for the protection of the legitimate interests of the lessee, and

(c) whether the lessor was able to understand any documents relating to the lease, and

(d) whether any undue influence or pressure was exerted on, or any unfair tactics were used against, the lessor or a person acting on behalf of the lessor by the lessee or a person acting on behalf of the lessee in relation to the lease, and

(e) the amount for which, and the circumstances under which, the lessor could have granted an identical or equivalent lease to a person other than the lessee, and

(f) the extent to which the lessee’s conduct towards the lessor was consistent with the lessee’s conduct in similar transactions between the lessee and other like lessors, and

(g) the requirements of any applicable industry code, and

(h) the requirements of any other industry code, if the lessor acted on the reasonable belief that the lessee would comply with that code, and

(i) the extent to which the lessee unreasonably failed to disclose to the lessor:

(i) any intended conduct of the lessee that might affect the interests of the lessor, and

(ii) any risks to the lessor arising from the lessee’s intended conduct (being risks that the lessee should have foreseen would not be apparent to the lessor), and

(j) the extent to which the lessee was willing to negotiate the terms and conditions of any lease with the lessor, and

(k) the extent to which the lessee and the lessor acted in good faith.

(5) A person is not to be taken for the purposes of this section to engage in unconscionable conduct in connection with a retail shop lease by reason only that the first-mentioned person institutes legal proceedings in relation to that lease or refers to arbitration a dispute or claim in relation to that lease.

(6) A person is not to be taken for the purposes of this section to engage in unconscionable conduct in connection with a retail shop lease by reason only that the first-mentioned person fails to renew the lease or issue a new lease.

(7) For the purpose of determining whether a lessor has contravened subsection (1) or whether a lessee has contravened subsection (2):

(a) the Tribunal must not have regard to any circumstances that were not reasonably foreseeable at the time of the alleged contravention, and

(b) the Tribunal may have regard to circumstances existing before the commencement of this section but not to conduct engaged in before that commencement.

(8) A lessor or lessee, or former lessor or lessee, who suffers loss or damage by reason of unconscionable conduct of another person that is in contravention of this section may recover the amount of the loss or damage by lodging a claim against the other person under section 71A.

(9) If the matter of such loss or damage arises in connection with a matter the subject of proceedings in the Tribunal, the Tribunal may proceed to decide it, and in so doing may award such sum as it thinks fit.

(10) In this section:
"lessee" or "former lessee" includes a person who is a guarantor or covenantor under a lease or former lease.