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PARLIAMENT OF VICTORIA
Retail Leases Act 2003
Act No.
TABLE OF PROVISIONS
Clause Page
PART 1--PRELIMINARY 1
1. Main purpose 1
2. Commencement 2
PART 2--DEFINITIONS AND KEY CONCEPTS 3
3. Definitions 3
4. Meaning of "retail premises" 7
5. Minister may make determinations 9
6. Meaning of "common areas" of a shopping centre 10
7. When retail premises lease is entered into or assigned 10
8. Effect of assignment of retail premises lease 11
9. Meaning of "renewal" of a lease 11
10. Holding over under a retail premises lease 12
PART 3--APPLICATION OF THE ACT 13
11. Application generally 13
12. Application if lease term of less than a year 13
13. Act applies to retail premises in Victoria 14
14. Act binds the Crown 15
PART 4--ENTERING INTO OR RENEWING A RETAIL
PREMISES LEASE 16
Division 1--Entering into a Retail Premises Lease 16
15. Copy of lease to be provided at negotiation stage 16
16. Lease must be in writing and signed 16
17. Landlord's disclosure statement 17
18. Effect of notice of termination 18
19. Notices of termination 19
20. Tenant not required to pay undisclosed contributions 19
21. Minimum 5 year term 20
22. Tenant to be given copy of lease 21
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23. Key-money and goodwill payments prohibited 22
24. Security deposits 23
25. Small Business Commissioner to be notified of lease 24
Division 2--Renewal of a Retail Premises Lease 25
26. Landlord's disclosure on renewal of lease 25
27. Option to renew 26
28. Obligation to notify tenant of option to renew 27
PART 5--RENT AND OUTGOINGS 29
Division 1--The Fit Out of the Premises 29
29. Meaning of "outgoings" to which a tenant contributes 29
30. Alterations to premises to enable fit out 29
31. Payment of rent when landlord's fit out not completed 30
32. Special rent--cost of fit out 31
Division 2--Determination of the Rent 31
33. Rent based on turnover 31
34. Agreement about rent based on turnover 34
Division 3--Review of the Rent 34
35. Rent reviews generally 34
36. Extended application of section 35 36
37. Rent reviews based on current market rent 36
38. Confidentiality of information supplied to valuer 38
Division 4--Outgoings 40
39. Recovery of outgoings from the tenant 40
40. Liability to contribute to non-specific outgoings 40
41. Capital costs not recoverable 41
42. Depreciation not recoverable 41
43. Tenant not liable to contribute to sinking fund 41
44. Interest etc. on landlord's borrowings not recoverable 41
45. Rent etc. associated with other land not recoverable 41
46. Estimate of outgoings 42
47. Statement of outgoings 43
48. Adjustment of contributions to outgoings 45
49. Limitation on recovery of management fees 45
50. Recovery of land tax 48
51. Liability for costs associated with lease 48
52. Landlord's liability for repairs 49
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PART 6--REFURBISHMENT, RELOCATION AND OTHER
INTERFERENCES WITH TENANCY 51
Division 1--Refurbishment, Relocation etc. 51
53. Landlord to give notice of alterations and refurbishments 51
54. Tenant to be compensated for interference 51
55. Relocation of the tenant's business 53
56. Demolition 55
57. Damaged premises 56
58. Refurbishment and refitting 58
Division 2--Other Interferences with Tenancy 58
59. Restriction on whom the tenant employs or engages 58
PART 7--ASSIGNMENT AND TERMINATION OF A RETAIL
PREMISES LEASE 59
60. When the landlord can withhold consent to an assignment 59
61. Procedure for obtaining consent to assignment 59
62. Protection of assignors and guarantors 61
63. Landlord may reserve the right to refuse a sub-lease,
mortgage etc. 61
64. Notice of the landlord's intentions concerning renewal 62
PART 8--ADDITIONAL REQUIREMENTS FOR RETAIL
SHOPPING CENTRES 64
65. Part only applies to retail shopping centres 64
66. Changes to core trading hours 64
67. Confidentiality of turnover information 64
68. Availability of statistical information about the retail shopping
centre 65
69. Advertising and promotion requirements 66
70. Marketing plan for advertising and promotion 66
71. Statement and report on advertising and promotion expenditure 66
72. Unspent advertising and promotion contributions 67
73. Termination by landlord for inadequate sales prohibited 68
74. Geographical restrictions on tenant prohibited 68
75. Tenants' associations etc. 69
PART 9--UNCONSCIONABLE CONDUCT 70
76. Application of Part 70
77. Unconscionable conduct of a landlord 70
78. Unconscionable conduct of a tenant 72
79. Certain conduct is not unconscionable 74
80. Recovery of amount for loss or damage 75
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PART 10--DISPUTE RESOLUTION 76
Division 1--Retail Tenancy Disputes 76
81. Meaning of "retail tenancy dispute" 76
82. Application of Part to retail premises 77
83. Part applies to current and former leases 77
Division 2--The Small Business Commissioner 77
84. Functions of Small Business Commissioner 77
Division 3--Alternative Dispute Resolution 79
85. What mediation and other alternative dispute resolution covers 79
86. Referral of retail tenancy disputes for alternative dispute
resolution 79
87. Retail tenancy disputes must first be referred for alternative
dispute resolution 80
88. Statements made during alternative dispute resolution not
admissible 81
Division 4--The Tribunal 81
89. Jurisdiction of Tribunal 81
90. Parties to proceeding 82
91. Orders the Tribunal can make 82
92. Each party bears its own costs 83
PART 11--OTHER MATTERS 84
93. Indemnities 84
94. The Act prevails over retail premises leases, agreements etc. 84
95. Occupation of residential area under a retail premises lease 85
96. Franchise arrangements 86
97. Service of documents 86
98. Limitation of Supreme Court jurisdiction 87
99. Regulations 87
PART 12--AMENDMENT OF RETAIL TENANCIES REFORM
ACT 1998 89
100. Definitions 89
101. Application 89
102. Rent review 90
103. New sections 12A to 13A substituted 91
12A. Rent reviews based on current market rent 91
12B. Confidentiality of information supplied to valuer 93
13. Rent based on turnover 95
13A. Agreement about rent based on turnover 97
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104. New section 16 substituted 98
16. Notice of the landlord's intentions concerning renewal 98
105. Options to renew 100
106. New sections 20 to 21A substituted 101
20. Liability to contribute to non-specific outgoings 101
20A. Estimate of outgoings 102
21. Statement of outgoings 102
21A. Adjustment of contributions to outgoings 105
107. New sections 24 and 25 substituted 106
24. Landlord to give notice of alterations and
refurbishments 106
25. Landlord's liability for repairs 106
108. New section 30 substituted 108
30. Relocation of the tenant's business 108
109. Minor amendments 110
PART 13--AMENDMENT OF RETAIL TENANCIES ACT 1986 111
110. Definitions 111
111. Application 111
112. Rent review 112
113. New sections 11 and 11A substituted 113
11. Rent based on turnover 113
11A. Agreement about rent based on turnover 115
114. Options to renew 116
115. New sections 14A to 15A substituted 118
14A. Estimate of outgoings 118
15. Statement of outgoings 118
15A. Adjustment of contributions to outgoings 121
116. New sections 17A and 17B inserted 122
17A. Relocation of the tenant's business 122
17B. Landlord's liability for repairs 124
117. Minor amendments 125
PART 14--REPEAL OF 1998 ACT AND TRANSITIONAL
PROVISIONS 126
118. Repeal of Retail Tenancies Reform Act 1998 126
119. General transitional and savings 126
120. Disclosure statements 126
121. Notification of amount of land tax 127
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PART 15--CONSEQUENTIAL AND OTHER AMENDMENTS 128
122. Shop Trading Reform Act 1996 128
123. Victorian Civil and Administrative Tribunal Act 1998 128
PART 17A--RETAIL LEASES ACT 2003 128
77B. Any legally qualified member may make a declaration 128
ENDNOTES 129
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PARLIAMENT OF VICTORIA
Initiated in Assembly 26 February 2003
A BILL
to provide a new regulatory scheme for retail leases, to amend and
repeal the Retail Tenancies Reform Act 1998, to amend the Retail
Tenancies Act 1986 and make minor amendments to certain other
Acts and for other purposes.
Retail Leases Act 2003
The Parliament of Victoria enacts as follows:
PART 1--PRELIMINARY
1. Main purpose
The main purpose of this Act is to replace the
scheme in the Retail Tenancies Reform Act
5 1998 with a new scheme to enhance--
(a) the certainty and fairness of retail leasing
arrangements between landlords and tenants;
and
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Retail Leases Act 2003
Act No.
Part 1--Preliminary
s. 2
(b) the mechanisms available to resolve disputes
concerning leases of retail premises.
2. Commencement
(1) Section 1 and this section (other than sub-section
5 (4)) come into operation on the day after the day
on which this Act receives the Royal Assent.
(2) Part 12 comes into operation immediately before
the commencement of section 118.
(3) Sections 49 and 50 come into operation on 1 July
10 2003.
(4) Part 13 is deemed to have come into operation at
the last moment of 30 June 1998.
(5) The remaining provisions of this Act (including
sub-section (4) of this section) come into
15 operation on 1 May 2003.
__________________
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Retail Leases Act 2003
Act No.
Part 2--Definitions and Key Concepts
s. 3
PART 2--DEFINITIONS AND KEY CONCEPTS
3. Definitions
In this Act--
"accountant" means a member of--
5 (a) the Institute of Chartered Accountants
in Australia; or
(b) CPA Australia (ACN 008 392 452); or
(c) the National Institute of Accountants;
"applicable industry code" has the meaning
10 given by section 51ACA of the Trade
Practices Act 1974 of the Commonwealth;
"assignment" of a retail premises lease has a
meaning affected by section 8;
"building" includes any structure;
15 "common areas" of a retail shopping centre has
the meaning given by section 6;
"dispute" arising under or in relation to a retail
premises lease includes a dispute arising
under or in relation to the lease under a
20 provision of this Act;
"fit out" of retail premises includes the provision
or installation of finishes, fixtures, fittings,
equipment and services;
"GST" has the same meaning as in the A New
25 Tax System (Goods and Services Tax) Act
1999 of the Commonwealth;
"industry code" has the meaning given by
section 51ACA of the Trade Practices Act
1974 of the Commonwealth;
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s. 3
"key-money" means money that a tenant is to
pay, or a benefit that a tenant is to give, that
is--
(a) by way of a premium, or something
5 similar in nature to a premium, in that
there is no real consideration or no true
consideration given for the payment or
benefit (for example, it is so
disproportionate to the benefit that it
10 cannot be true consideration); and
(b) in consideration of--
(i) a lease being granted or an
agreement being made to grant a
lease; or
15 (ii) the variation of a lease; or
(iii) the renewal of a lease or the
granting of an option for the
renewal of a lease; or
(iv) consent being given to the
20 assignment of a lease or to the
sub-leasing of the premises to
which a lease relates;
"landlord" under a retail premises lease--
(a) means the person who under the lease
25 is entitled to the rent payable for the
premises; and
(b) in Part 10, includes a former landlord
(because of section 83);
"lease"--
30 (a) means a lease, sub-lease, or an
agreement for a lease or sub-lease,
whether or not in writing; and
(b) in Part 10, includes a former lease
(because of section 83);
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s. 3
"legal practitioner" means a person admitted to
legal practice in Victoria or an interstate
practitioner within the meaning of the Legal
Practice Act 1996;
5 "outgoings" means a landlord's outgoings on
account of any of the following--
(a) the expenses directly attributable to the
operation, maintenance or repair of--
(i) the building in which the retail
10 premises are located or any other
building or area owned by the
landlord and used in association
with the building in which the
retail premises are located; or
15 (ii) in the case of retail premises in a
retail shopping centre, any
building in the centre or any areas
used in association with a building
in the centre;
20 (b) rates, taxes, levies, premiums or
charges payable by the landlord
because the landlord is--
(i) the owner or occupier of a
building referred to in paragraph
25 (a) or of the land on which such a
building is erected; or
(ii) the supplier of a taxable supply,
within the meaning of the A New
Tax System (Goods and Services
30 Tax) Act 1999 of the
Commonwealth, in respect of any
such building or land;
"renewal" of a retail premises lease has the
meaning given by section 9;
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Act No.
Part 2--Definitions and Key Concepts
s. 3
"retail premises" has the meaning given by
section 4;
"retail shopping centre" means a cluster of
premises that has all of these attributes--
5 (a) at least 5 of the premises are retail
premises;
(b) the premises are all owned by the same
person or have (or would have if
leased) the same landlord or the same
10 head landlord;
(c) the premises are located--
(i) in a single building; or
(ii) in 2 or more buildings that are--
(A) adjoining; or
15 (B) separated only by common
areas or other areas owned
by the owner of the retail
premises; or
(C) separated only by a road;
20 (d) the cluster of premises is promoted as,
or generally regarded as constituting, a
shopping centre, shopping mall,
shopping court or shopping arcade;
"retail tenancy dispute" in Part 10 has the
25 meaning given by section 81;
"Small Business Commissioner" means the
Small Business Commissioner appointed
under the Small Business Commissioner
Act 2003;
30 "specialist retail valuer" means--
(a) for the purposes of a valuation relating
to retail premises in a retail shopping
centre, a valuer having not less than
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Part 2--Definitions and Key Concepts
s. 4
5 years' experience in valuing retail
premises located in regional or
sub-regional shopping centres; or
(b) for the purposes of a valuation relating
5 to any other retail premises, a valuer
having not less than 5 years' experience
in valuing retail premises;
"tenant" under a retail premises lease--
(a) means the person who under the lease
10 is entitled to occupy the premises; and
(b) in Part 10, includes a former tenant
(because of section 83);
"Tribunal" means the Victorian Civil and
Administrative Tribunal established by the
15 Victorian Civil and Administrative
Tribunal Act 1998.
4. Meaning of "retail premises"
(1) In this Act, "retail premises" means premises, or
a part of premises, that under the terms of the
20 lease relating to the premises or part are used, or
are to be used, wholly or predominantly for--
(a) the sale or hire of goods by retail or the retail
provision of services; or
(b) the carrying on of a specified business or a
25 specified kind of business that the Minister
determines under section 5 is a business to
which this paragraph applies.
(2) However, "retail premises" does not include the
following premises--
30 (a) premises in respect of which the occupancy
costs (as defined in sub-section (3)) under
the lease concerned is more than the amount
prescribed by the regulations for the
purposes of this paragraph;
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(b) premises that are used wholly or
predominantly for the carrying on of a
business by a tenant on behalf of the landlord
as the landlord's employee or agent;
5 (c) premises the tenant of which is--
(i) a listed corporation (as defined in
section 9 of the Corporations Act); or
(ii) a subsidiary (as defined in section 9 of
the Corporations Act) of such a
10 corporation;
(d) premises the tenant of which is--
(i) a body corporate whose securities are
included in an official list of a stock
market (as defined in section 9 of the
15 Corporations Act) outside Australia and
the external Territories; or
(ii) a subsidiary (as defined in section 9 of
the Corporations Act) of such a body
corporate;
20 (e) premises used wholly or predominantly for
the carrying on of a specified business or a
specified kind of business that the Minister
determines under section 5 is a business to
which this paragraph applies;
25 (f) premises of a kind that the Minister
determines under section 5 are premises to
which this paragraph applies.
(3) In sub-section (2)(a), "occupancy costs" means--
(a) the rent payable under the lease, not being
30 rent (or any part of rent) that is to be
determined by reference to the turnover of a
business; and
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Part 2--Definitions and Key Concepts
s. 5
(b) outgoings of a prescribed kind to which the
tenant is liable to contribute under the lease;
and
(c) any other costs of a prescribed kind that the
5 tenant is liable to pay under the lease.
(4) Regulations made for the purposes of sub-section
(2)(a) may--
(a) prescribe an amount; or
(b) prescribe a method by which an amount may
10 be calculated.
Note: This Act may not apply to certain premises because of Part
3 (Application of the Act).
5. Minister may make determinations
(1) The Minister may, by notice published in the
15 Government Gazette--
(a) determine that a business is a business or a
kind of business to which section 4(1)(b)
applies; or
(b) determine that a business is a business or a
20 kind of business to which section 4(2)(e)
applies; or
(c) determine that a kind of premises are
premises to which section 4(2)(f) applies.
(2) The powers conferred by sub-section (1) to make
25 an instrument are subject to the instrument being
disallowed by the Parliament.
(3) Section 15 and Part 5 of the Subordinate
Legislation Act 1994 apply to an instrument
made under sub-section (1) as though--
30 (a) the instrument were a statutory rule (within
the meaning of that Act); and
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Part 2--Definitions and Key Concepts
s. 6
(b) notice of the making of the statutory rule had
been published in the Government Gazette
when the instrument was published in the
Government Gazette.
5 6. Meaning of "common areas" of a shopping centre
(1) In this Act, the "common areas" of a retail
shopping centre means the areas in or adjacent to
the centre that are under the control of the
landlord and are used or intended for use--
10 (a) by the public; or
(b) in common by the tenants of premises in the
centre relating to the carrying on of
businesses on those premises--
other than any areas in respect of which there is a
15 retail premises lease to which this Act applies.
(2) The "common areas" of a retail shopping centre
include--
(a) stairways, escalators and elevators; and
(b) malls and walkways; and
20 (c) parking areas; and
(d) toilets and rest rooms; and
(e) gardens and fountains; and
(f) information, entertainment, community and
leisure facilities.
25 7. When retail premises lease is entered into or assigned
For the purposes of this Act, a retail premises
lease is entered into or assigned when either of
these things happen--
(a) under the lease or assignment, the tenant
30 enters into possession of the premises with
the consent of the landlord or begins to pay
rent for the premises;
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Act No.
Part 2--Definitions and Key Concepts
s. 8
(b) the lease or assignment has been signed by
all of the parties to it.
8. Effect of assignment of retail premises lease
For the purposes of this Act, an assignment of a
5 retail premises lease is taken to be a continuation
of that lease (and not the entering into of a new
lease).
9. Meaning of "renewal" of a lease
(1) In this Act, the "renewal" of a retail premises
10 lease means the renewal of the lease--
(a) under an option granted under the lease for a
further term; or
(b) under an agreement to renew the lease for a
further term entered into by all of the parties
15 to the lease.
(2) However, if--
(a) after a retail premises lease expires, there is a
break in the tenant's possession of the
premises; and
20 (b) the tenant resumes possession of the
premises for a further term (whether or not
on the same terms and conditions as under
the expired lease)--
the resumption of possession of the premises is
25 taken not to be a renewal of the expired lease and
is instead taken to be the entering into of a new
lease for the purposes of this Act.
(3) The renewal of a retail premises lease is not to be
taken to be the entering into of a retail premises
30 lease for the purposes of section 17 (landlord's
disclosure statement).
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Act No.
Part 2--Definitions and Key Concepts
s. 10
10. Holding over under a retail premises lease
If, in accordance with a retail premises lease, the
tenant continues to be in possession of the retail
premises for a period after the lease has expired,
5 the lease is taken to continue for the purposes of
this Act while the tenant is in possession of the
premises.
__________________
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Retail Leases Act 2003
Act No.
Part 3--Application of the Act
s. 11
PART 3--APPLICATION OF THE ACT
11. Application generally
(1) This Act applies to a retail premises lease that is--
(a) entered into after the commencement of this
5 section; or
(b) renewed after the commencement of this
section, whether the lease was entered into
before or after that commencement.
(2) Except as provided by Part 10 (Dispute
10 Resolution), this Act only applies to a lease of
premises if the premises are retail premises (as
defined in section 4) at the time the lease is
entered into or renewed.
Note: Sections 36 and 76(1) extend the application of certain
15 provisions of this Act to certain leases entered into or
renewed before the commencement of this section.
12. Application if lease term of less than a year
(1) This Act does not apply to a retail premises lease
for a term of less than one year.
20 (2) However, if the term of a retail premises lease is
less than one year and as a result of either or both
of the following--
(a) the lease being renewed (one or more times);
(b) the lease being continued--
25 the tenant is continuously in possession of the
retail premises for one year or more under the
lease, this Act applies to the lease on and from the
day on which the tenant has continuously been in
possession of the retail premises for one year.
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(3) If this Act applies to a lease because of
sub-section (2)--
(a) section 17 (landlord's disclosure statement)
does not apply to the lease; and
5 (b) section 26 (landlord's disclosure on renewal
of lease) applies to the lease with these
changes--
(i) section 26(1) is taken to provide that
the landlord must give the tenant the
10 disclosure statement referred to in that
section within 60 days after this Act
begins to apply to the lease;
(ii) section 26(3) is taken to provide that if
the tenant has not been given the
15 disclosure statement within that time,
the tenant may give the landlord the
notice referred to in that section no
earlier than 7 days and no later than
90 days after this Act begins to apply to
20 the lease;
(iii) section 26(5)(b) is taken to refer to
when this Act begins to apply to the
lease.
13. Act applies to retail premises in Victoria
25 Subject to this Part, this Act applies to a lease that
provides for the occupation of retail premises in
Victoria regardless of--
(a) where the lease was entered into; and
(b) whether the lease purports to be governed by
30 a law other than the law of Victoria.
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Part 3--Application of the Act
s. 14
14. Act binds the Crown
This Act binds the Crown--
(a) in right of the State of Victoria; and
(b) to the extent that the legislative power of the
5 Parliament permits, in all its other capacities.
__________________
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Retail Leases Act 2003
Act No.
Part 4--Entering Into or Renewing a Retail Premises Lease
s. 15
PART 4--ENTERING INTO OR RENEWING A RETAIL
PREMISES LEASE
Division 1--Entering into a Retail Premises Lease
15. Copy of lease to be provided at negotiation stage
5 A person who, as landlord or on behalf of the
landlord--
(a) offers to enter into a retail premises lease; or
(b) advertises by any means that retail premises
are for lease--
10 must, as soon as the person enters into
negotiations with a person about the lease, give to
that person a copy of the proposed lease in writing
(but the copy need not include particulars of the
tenant, the rent or the term of the proposed lease)
15 and a copy of the information brochure (if any)
about retail leases published by the Small
Business Commissioner.
Penalty: 50 penalty units.
16. Lease must be in writing and signed
20 (1) A landlord or tenant must not enter into a retail
premises lease that is not in writing and signed by
all of the parties to it.
Penalty: 10 penalty units.
(2) A failure to comply with this section does not
25 make the retail premises lease illegal, invalid or
unenforceable.
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s. 17
17. Landlord's disclosure statement
(1) At least 7 days before entering into a retail
premises lease, the landlord must give the
tenant--
5 (a) a disclosure statement in the form prescribed
by the regulations (but the layout of the
statement need not be the same as the
prescribed disclosure statement); and
(b) a copy of the proposed lease in writing.
10 (2) If a tenant has not been given the disclosure
statement before entering into a retail premises
lease, the tenant may give the landlord, no earlier
than 7 days and no later than 90 days after
entering into the lease, a written notice that the
15 tenant has not been given the disclosure statement.
(3) If the tenant gives the landlord a notice in
accordance with sub-section (2)--
(a) the tenant may withhold payment of the rent
until the day on which the landlord gives the
20 tenant the disclosure statement; and
(b) the tenant is not liable to pay the rent
attributable to the period from and including
the day on which the notice was given until
and including the day on which the landlord
25 gives the tenant the disclosure statement; and
(c) the tenant may give the landlord a written
notice of termination at any time before the
end of 7 days after the landlord gives the
tenant the disclosure statement.
30 (4) If the premises are not available for handover to
the tenant on the date specified in the disclosure
statement, the tenant is not liable to pay the rent
attributable to a period before that date.
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(5) If--
(a) any information provided by the landlord in
the disclosure statement is misleading, false
or materially incomplete; or
5 (b) the tenant is not given a copy of the proposed
lease in accordance with sub-section (1)(b)--
the tenant may give the landlord a written notice
of termination.
(6) The tenant may give a notice of termination under
10 sub-section (5) at any time before the end of
28 days after--
(a) the tenant is given the disclosure statement;
or
(b) the tenant is given a copy of the lease; or
15 (c) the lease is entered into--
whichever happens last.
18. Effect of notice of termination
(1) If a tenant under a retail premises lease gives the
landlord a notice of termination under--
20 (a) section 17(3)(c) within the time allowed by
that section; or
(b) section 17(5) within the time allowed by
section 17(6)--
the lease terminates 14 days after the notice is
25 given unless the landlord gives the tenant a notice
of objection to the termination.
(2) Within 14 days after being given the notice of
termination the landlord may give the tenant a
notice of objection to the termination on the
30 ground that--
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(a) the landlord has acted honestly and
reasonably and ought fairly to be excused for
the contravention; and
(b) the tenant is substantially in as good a
5 position as the tenant would have been in if
there had been no contravention.
(3) If the tenant advises the landlord that the tenant
accepts the landlord's notice of objection or the
notice is upheld under Part 10, the lease does not
10 terminate in accordance with the notice of
termination despite sub-section (1).
(4) The tenant is taken to have accepted the notice of
objection if the tenant does not advise (in writing)
the landlord, within 14 days after being given the
15 notice, whether or not the tenant accepts it.
(5) The operation of a notice of termination under
section 17(3)(c) or (5) is suspended until the effect
of a notice of objection to it is determined.
19. Notices of termination
20 The termination of a lease by a notice of
termination given in accordance with this Act
does not affect any right, privilege, obligation or
liability acquired, accrued or incurred under the
lease before the date of termination, unless the
25 landlord and tenant otherwise agree or it is
otherwise provided by this Act or determined
under Part 10.
20. Tenant not required to pay undisclosed contributions
A provision of a retail premises lease that requires
30 the tenant to pay or contribute towards the cost of
any fit out of the retail premises is void unless the
liability to make the payment or contribution was
disclosed in a disclosure statement given to the
tenant in accordance with this Part.
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21. Minimum 5 year term
(1) The term of a retail premises lease, including any
further term or terms provided for by an option for
the tenant to renew the lease, must be at least 5
5 years or, if the term remaining under any head
lease under which the landlord holds the retail
premises is 5 years or less, the length of that
remaining term less one day.
Note: The landlord or tenant may, in accordance with the
10 lease or this Act, be able to terminate the lease before
the end of the term.
(2) In applying sub-section (1), an option conferred
after the lease was entered into must be
disregarded.
15 (3) This section does not apply to a renewal of a lease
if there is no break in the tenant's entitlement to
possession of the retail premises.
Note: This means that a renewal of a lease is not required to
be for 5 years because the minimum 5 year term
20 requirement applied to the lease when it was entered
into and the availability of the renewal will have been
taken into account in determining the term of the
lease.
(4) A lease that is entered into contrary to this section
25 is not illegal, invalid or unenforceable because of
that fact but the term of the lease is extended by
the period that is necessary to ensure the lease
complies with this section.
Note: For example, if a lease is entered into for a term of
30 3 years, its term is extended by 2 years to 5 years.
If a lease is entered into for a term of 2 years with an
option for a further 1 year after the initial 2 years, the
term of the lease is extended to 4 years (with the
option for a further 1 year after the initial 4 years).
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(5) This section does not apply to a lease if--
(a) at the tenant's request, the Small Business
Commissioner certifies in writing that he or
she, or a person acting on his or her behalf,
5 has explained to the tenant--
(i) the effect of sub-sections (1) to (4); and
(ii) that the giving of the certificate and the
giving by the tenant of a notice under
paragraph (b) will result in this section
10 not applying to the lease; and
(b) after having been given a certificate under
paragraph (a)(ii), the tenant gives the
landlord a written notice waiving the
application of this section to the lease.
15 (6) The Small Business Commissioner must issue a
certificate under sub-section (5)(a)(ii) within
21 days after being requested to do so by the
tenant but a certificate issued later than that is not
invalid because of that fact.
20 22. Tenant to be given copy of lease
(1) Within 28 days after being given a copy of the
retail premises lease signed by the tenant, the
landlord must give the tenant a copy (which may
be a photocopy) of the lease signed by the
25 landlord and the tenant.
(2) If the landlord contravenes sub-section (1), the
tenant may give the landlord a written notice of
termination at any time within 28 days after--
(a) the tenant is given a copy of the lease; or
30 (b) entering into the lease--
whichever happens last.
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(3) Subject to sub-section (4), if a tenant gives the
landlord a notice of termination in accordance
with sub-section (2), the lease terminates 14 days
after the notice is given.
5 (4) Section 18 applies to a notice of termination given
under this section in the same way and to the same
extent as it applies to a notice of termination given
under section 17(3)(c) or (5).
23. Key-money and goodwill payments prohibited
10 (1) A person must not, as landlord or on behalf of a
landlord, seek or accept the payment of--
(a) key-money; or
(b) any consideration for the goodwill of any
business carried on at the retail premises.
15 Penalty: 50 penalty units.
(2) A provision of a retail premises lease is void to
the extent that it requires the payment of
key-money or consideration for goodwill or has
that effect.
20 (3) However, sub-sections (1) and (2) do not prevent
a landlord from--
(a) recovering from the tenant costs which the
landlord reasonably incurred in investigating
a proposed assignee of the lease or
25 sub-tenant of the premises; or
(b) recovering from the tenant costs which the
landlord reasonably incurred in connection
with--
(i) an assignment of the lease or a
30 sub-lease; and
(ii) obtaining any necessary consents to the
assignment or sub-lease; or
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(c) claiming goodwill from the tenant in relation
to the sale of a business that the landlord
operated from the retail premises
immediately before its sale, if the lease was
5 granted to the tenant in the course of the sale
of the business; or
(d) receiving payment of rent in advance; or
(e) securing the performance of the tenant's
obligations under the lease by requiring a
10 bond, security deposit or guarantee to be
provided from the tenant or any other person
(such as a requirement that the directors of a
corporation guarantee performance of the
corporation's lease obligations); or
15 (f) seeking and accepting payment for plant,
equipment, fixtures or fittings that are sold
by the landlord to the tenant in connection
with the lease being granted; or
(g) seeking and accepting payment for the grant
20 of a franchise in connection with the lease
being granted.
(4) Any payment made, or the value of any benefit
conferred, by the tenant and received by or on
behalf of the landlord contrary to this section may
25 be--
(a) recovered by the tenant from the landlord in
a court of competent jurisdiction as a debt
due; or
(b) ordered by the Tribunal under Part 10 to be
30 paid to the tenant by the landlord.
24. Security deposits
(1) A retail premises lease is taken to provide that--
(a) money paid by the tenant to the landlord as a
security deposit for the performance of the
35 tenant's obligations under the lease must be
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held by the landlord on behalf of the tenant
in an interest-bearing account; and
(b) the landlord must account to the tenant for
interest earned on the deposit but the
5 landlord is entitled to keep the interest and
deal with it as money paid by the tenant to
the landlord to form part of the security
deposit; and
(c) the landlord is not entitled unreasonably to
10 refuse to accept a guarantee from an ADI
(within the meaning of the Banking Act 1959
of the Commonwealth) in satisfaction of any
requirement to provide security in the form
of a deposit, bond or third party guarantee
15 for the performance of the tenant's
obligations under the lease.
(2) A tenant who has performed all of the tenant's
obligations under a retail premises lease is entitled
to the return of the security deposit.
20 (3) This section does not affect any lawful entitlement
of the landlord to appropriate security deposits.
25. Small Business Commissioner to be notified of lease
Within 14 days (or such other period as is agreed
between the landlord and the Small Business
25 Commissioner) after a retail premises lease is
signed by all of the parties to it, the landlord must
notify (in writing) the Small Business
Commissioner of--
(a) the address of the retail premises; and
30 (b) the landlord's name and address (and, if the
landlord is not a natural person, the name
and address of a person who can be
contacted about the lease); and
(c) the tenant's name and address; and
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(d) such other matters (if any) as are prescribed
by the regulations.
Penalty: 10 penalty units.
Division 2--Renewal of a Retail Premises Lease
5 26. Landlord's disclosure on renewal of lease
(1) If--
(a) a tenant has exercised, or is entitled to
exercise, an option to renew a retail premises
lease granted under the lease; or
10 (b) all of the parties to a retail premises lease
enter into an agreement to renew the lease--
the landlord must (at least 21 days before the end
of the current term of the lease in the
circumstances referred to in paragraph (a) and at
15 least 14 days after the entering into of the
agreement in the circumstances referred to in
paragraph (b)) give the tenant a disclosure
statement in the form prescribed by the
regulations (but the layout of the statement need
20 not be the same as the prescribed disclosure
statement).
Note: Section 12(3) changes the way that this section
applies to certain leases (for example, the time limit
in sub-section (1) is changed).
25 (2) The disclosure statement must include information
that is current from a specified date that is within
3 months before the statement is given.
(3) If the tenant has not been given the disclosure
statement before the retail premises lease is
30 renewed, the tenant may give the landlord, no
earlier than 7 days and no later than 90 days after
the lease is renewed, a written notice that the
tenant has not been given the disclosure statement.
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(4) If the tenant gives the landlord a notice in
accordance with sub-section (3)--
(a) the tenant may withhold payment of the rent
until the day on which the landlord gives the
5 tenant the disclosure statement; and
(b) the tenant is not liable to pay the rent
attributable to the period from and including
the day on which the notice was given until
and including the day on which the landlord
10 gives the tenant the disclosure statement; and
(c) the tenant may give the landlord a written
notice of termination at any time before the
end of 7 days after the landlord gives the
tenant the disclosure statement.
15 (5) If any information provided by the landlord in the
disclosure statement is misleading, false or
materially incomplete, the tenant may give the
landlord a written notice of termination at any
time before the end of 28 days after--
20 (a) the tenant is given the disclosure statement;
or
(b) the lease is renewed--
whichever happens last.
(6) Section 18 applies to a notice of termination given
25 under sub-section (4)(c) or (5) in the same way
and to the same extent as it applies to a notice of
termination given under section 17(3)(c) or (5).
Note: This section applies to the renewal, on or after its
commencement, of a lease entered into before its
30 commencement, see section 11(1).
27. Option to renew
(1) If a retail premises lease contains an option
exercisable by the tenant to renew the lease for a
further term, the lease must state--
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(a) the date until which the option is exercisable;
and
(b) how the option is to be exercised; and
(c) the terms and conditions on which the lease
5 is renewable under the option; and
(d) how the rent payable during the term for
which the lease is renewed is to be
determined.
(2) If a retail premises lease contains an option
10 exercisable by the tenant to renew the lease for a
further term, the only circumstances in which the
option is not exercisable is if--
(a) the tenant has not remedied any default
under the lease about which the landlord has
15 given the tenant written notice; or
(b) the tenant has persistently defaulted under
the lease throughout its term and the landlord
has given the tenant written notice of the
defaults.
20 28. Obligation to notify tenant of option to renew
(1) If a retail premises lease contains an option
exercisable by the tenant to renew the lease for a
further term, the landlord must notify the tenant in
writing of the date after which the option is no
25 longer exercisable--
(a) at least 6 months; and
(b) no more than 12 months--
before that date but is not required to do so if the
tenant exercises, or purports to exercise, the
30 option before being notified of the date.
(2) If sub-section (1) requires the landlord to notify
the tenant but the landlord fails to do so within the
time specified by that sub-section--
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(a) the retail premises lease is taken to provide
that the date after which the option is no
longer exercisable is instead 6 months after
the landlord notifies the tenant as required;
5 and
(b) if that date is after the term of the lease ends,
the lease continues until that date (on the
same terms and conditions as applied
immediately before the lease term ends); and
10 (c) at any time before the landlord notifies the
tenant as required, the tenant may give
written notice to the landlord terminating the
lease from a specified day that is--
(i) on or after the date on which the term
15 of the lease ends; and
(ii) before the date until which the lease
would otherwise have continued
because of paragraph (b).
(3) If the tenant gives the landlord a notice of
20 termination under sub-section (2)(c), the lease
terminates on the day specified in the notice.
(4) If an option to renew is exercised because of sub-
section (2)(b) after the term of the lease ends, the
lease for the further term commences on the
25 expiry of the previous lease, disregarding for this
purpose any period during which that lease
continued because of that sub-section.
__________________
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PART 5--RENT AND OUTGOINGS
Division 1--The Fit Out of the Premises
29. Meaning of "outgoings" to which a tenant
contributes
5 In this Part, "outgoings" to which a tenant under
a retail premises lease contributes or is liable to
contribute means any outgoings (as defined in
section 3) in respect of which the tenant is liable
under the lease to make any payment to the
10 landlord.
30. Alterations to premises to enable fit out
(1) A retail premises lease where the retail premises
are located in a retail shopping centre is taken to
provide as set out in this section if the tenant is
15 liable under the lease to pay an amount for the
costs of, or associated with, carrying out works to
alter any of the following to enable the proposed
fit out of the premises--
(a) the electrical reticulation at the premises;
20 (b) the automatic sprinkler system at the
premises;
(c) the power or gas supply to the premises;
(d) the layout of air-conditioning ducts or
registers;
25 (e) the location of exhausts;
(f) telephone or electrical cabling;
(g) such other things as are prescribed by the
regulations.
(2) The works must be carried out by a person or
30 persons with suitable skills and experience
engaged, or approved, by the landlord.
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(3) The maximum cost of the works, or a basis or
formula with respect to those costs, is to be agreed
in writing by the landlord and tenant before the
works begin.
5 (4) If the landlord and tenant cannot agree on the
maximum cost of the works or a basis or formula
with respect to those costs, the maximum cost is
to be determined by an independent quantity
surveyor appointed by--
10 (a) agreement between the landlord and tenant;
or
(b) if there is no agreement, the Small Business
Commissioner--
and the landlord and tenant are to pay the costs of
15 the independent quantity surveyor in equal shares.
(5) The tenant is not liable to pay an amount in
respect of the works that is more than the
maximum cost agreed by the landlord and tenant,
or determined by the independent quantity
20 surveyor, as the case may be.
31. Payment of rent when landlord's fit out not completed
(1) This section applies to a retail premises lease if--
(a) the liability of the tenant to pay rent under
the lease starts when the tenant enters into
25 possession of the retail premises (whether or
not the tenant is required to enter into
possession by a specified date); and
(b) the landlord has obligations under the lease
concerning the fit out of the premises (that is,
30 the landlord is required to provide some or
all of the fit out before the tenant enters into
possession of the premises).
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(2) The retail premises lease is taken to provide
that--
(a) the tenant is not liable to pay rent, or any
other amount payable under the lease by the
5 tenant (such as an amount payable for
outgoings), in respect of any period before
the landlord has substantially complied with
the landlord's obligations concerning the fit
out of the premises; and
10 (b) except on reasonable grounds of safety, the
landlord is not entitled to deny the tenant
possession of the premises merely because
the landlord has not complied with those
obligations.
15 32. Special rent--cost of fit out
Apart from section 30, nothing in this Act
prevents a retail premises lease from providing for
the payment of a special rent (in addition to any
other rent) to cover the landlord's costs relating to
20 the fit out of the premises.
Division 2--Determination of the Rent
33. Rent based on turnover
(1) A provision in a retail premises lease that the rent
is to be determined either fully or partly by
25 reference to the turnover of the business is void
unless the lease specifies how the rent is to be
determined.
Note: If the provision is void, see section 34.
(2) If a retail premises lease specifies how the rent is
30 to be determined fully or partly by reference to the
turnover of the business, the tenant must give the
landlord--
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(a) within 14 days after the end of each month
for which the rent is to be determined in that
way or such longer period as the lease
provides, a statement in writing giving the
5 turnover during that month or other period to
which the statement relates; and
(b) within 28 days after the end of each year for
which the rent is to be determined in that
way or such longer period as the lease
10 provides and at the end of the lease or on an
assignment of the lease--
(i) a statement of the turnover; and
(ii) an audit report from an independent
accountant stating that in his or her
15 opinion the statement fairly presents the
turnover of the business during that
year or other period to which the
statement relates.
(3) A tenant who gives the landlord statements for a
20 period in accordance with sub-section (2) satisfies
any obligation under the lease to provide turnover
figures or statements for that period.
(4) For the purposes of sub-sections (2) and (3) and
any provision of a retail premises lease about the
25 determination of rent by reference to turnover,
"turnover" does not include any of the
following--
(a) the net amount of discounts reasonably and
properly allowed to any customer in the
30 usual course of business;
(b) the amount of losses incurred in the resale or
disposal of goods reasonably and properly
purchased from customers as trade-ins in the
usual course of business;
35 (c) the amount of uncollected credit accounts
written off by the tenant (except to the extent
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that amounts of a credit account previously
written off by the tenant are recovered);
(d) the amount of any cash or credit refund
allowed on a transaction the proceeds of
5 which have previously been included as
turnover, if the merchandise is returned and
the sale is cancelled or some or all of the fees
for the services are refunded;
(e) the amount of any instalment of purchase
10 money refunded to customers where a lay-by
transaction is cancelled;
(f) the amount of any purchase, receipt or other
similar tax (including GST) imposed on the
purchase price or cost of hire of merchandise
15 or services at the point of sale or hire;
(g) the amount of delivery charges;
(h) the price of merchandise exchanged between
stores of the tenant made solely for the
convenient operation of business and not for
20 the purpose of concluding a sale made at or
from the retail premises to which the lease
relates;
(i) the price of merchandise returned to
shippers, wholesalers or manufacturers;
25 (j) the amount received from the sale of the
fixtures and fittings of the tenant from the
premises;
(k) money received for entries in any public
lottery within the meaning of the Public
30 Lotteries Act 2000, other than amounts
derived as commission or fees on those
entries;
(l) any other matter which the landlord and the
tenant agree is not included as turnover.
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34. Agreement about rent based on turnover
(1) If--
(a) a provision of a retail premises lease that the
rent is to be determined either fully or partly
5 by reference to the turnover of the business
is void because of section 33; and
(b) the lease makes no other provision for
determining the rent--
the rent is to be as agreed in writing between the
10 landlord and tenant.
(2) If the landlord and tenant do not agree on an
amount of rent within 30 days of the landlord
giving the tenant a written notice specifying an
amount, the amount of the rent is to be determined
15 by a valuation carried out by a specialist retail
valuer appointed by--
(a) agreement between the landlord and tenant;
or
(b) if there is no agreement, the Small Business
20 Commissioner--
and the landlord and tenant are to pay the costs of
the valuation in equal shares.
Division 3--Review of the Rent
35. Rent reviews generally
25 (1) If a retail premises lease provides for a review of
the rent payable under the lease or under a
renewal of the lease, the lease must state--
(a) when the reviews are to take place; and
(b) the basis or formula on which the reviews
30 are to be made.
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(2) The basis or formula on which a rent review is to
be made must be one of the following--
(a) a fixed percentage;
(b) an independently published index of prices
5 or wages;
(c) a fixed annual amount;
(d) the current market rent of the retail premises;
(e) a basis or formula prescribed by the
regulations.
10 Note: For reviews based on the current market rent of the
retail premises, see section 36.
(3) A provision in a retail premises lease is void to the
extent that it purports to preclude, or prevents or
enables a person to prevent, the reduction of the
15 rent or to limit the extent to which the rent may be
reduced.
(4) However, sub-section (3) does not apply to a
provision that uses--
(a) a basis or formula referred to in sub-section
20 (2)(a), (b) or (c); or
(b) a prescribed basis or formula referred to in
sub-section (2)(e) that is also prescribed as a
basis or formula to which sub-section (3)
does not apply.
25 (5) A rent review is to be conducted as early as
practicable within the time provided by the lease.
If the landlord has not initiated the review within
90 days after the end of that time, the tenant may
initiate the review.
30 (6) A rent review provision in a retail premises lease
is void if the lease does not specify how the
review is to be made.
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(7) If a provision in a retail premises lease that
provides for a review of the rent payable under the
lease does not comply with sub-section (2), the
rent is to be--
5 (a) as agreed between the landlord and tenant; or
(b) if there is no agreement within 30 days after
the landlord gives the tenant, or the tenant
gives the landlord, a written notice
specifying an amount of rent for the purposes
10 of the review, the amount determined by a
specialist retail valuer appointed by the
Small Business Commissioner as the current
market rent of the retail premises.
(8) The landlord and tenant are to pay the costs of a
15 valuation referred to in sub-section (7)(b) in equal
shares.
36. Extended application of section 35
In addition to a retail premises lease to which
section 35 applies because of Part 3, that section
20 also applies to the determination on a rent
review (conducted after the commencement of
section 11) of the commencing rent for the
renewed term of a retail premises lease that was
entered into before that commencement, and to
25 any subsequent review of the rent payable under
the renewed lease, if this Act would have applied
to the lease had it been entered into after that
commencement.
37. Rent reviews based on current market rent
30 (1) A retail premises lease that provides for a rent
review to be made on the basis of the current
market rent of the premises is taken to provide as
set out in sub-sections (2) to (6).
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(2) The current market rent is taken to be the rent
obtainable at the time of the review in a free and
open market between a willing landlord and
willing tenant in an arm's length transaction
5 having regard to these matters--
(a) the provisions of the lease;
(b) the rent that would reasonably be expected to
be paid for the premises if they were
unoccupied and offered for lease for the
10 same, or a substantially similar, use to which
the premises may be put under the lease;
(c) the landlord's outgoings to the extent to
which the tenant is liable to contribute to
those outgoings;
15 (d) rent concessions and other benefits offered to
prospective tenants of unoccupied retail
premises--
but the current market rent is not to take into
account the value of goodwill created by the
20 tenant's occupation or the value of the tenant's
fixtures and fittings.
(3) If the landlord and tenant do not agree on what the
amount of that rent is to be, it is to be determined
by a valuation carried out by a specialist retail
25 valuer appointed by--
(a) agreement between the landlord and tenant;
or
(b) if there is no agreement, the Small Business
Commissioner--
30 and the landlord and tenant are to pay the costs of
the valuation in equal shares.
(4) The landlord must, within 14 days after a request
by the specialist retail valuer, supply the valuer
with relevant information about leases for retail
35 premises located in the same building or retail
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shopping centre to assist the valuer to determine
the current market rent.
Penalty: 50 penalty units.
(5) In determining the amount of the rent, the
5 specialist retail valuer must take into account the
matters set out in sub-section (2).
(6) The valuation must--
(a) be in writing; and
(b) contain detailed reasons for the specialist
10 retail valuer's determination; and
(c) specify the matters to which the valuer had
regard in making the determination.
(7) The specialist retail valuer--
(a) must carry out the valuation within 45 days
15 after accepting the appointment; and
(b) may apply to the Tribunal under Part 10 for
an order that a landlord comply with a
request under sub-section (4).
38. Confidentiality of information supplied to valuer
20 (1) A specialist retail valuer who is supplied with
information by a landlord or tenant for the
purpose of determining under section 36 the
current market rent for a retail premises lease
must not--
25 (a) use or permit the use of the information for
any purpose other than to determine the
current market rent for the lease concerned;
or
(b) communicate or divulge that information to
30 any other person or permit that information
to be communicated or divulged to any other
person.
Penalty: 50 penalty units.
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(2) However, sub-section (1) does not prevent the
specialist retail valuer--
(a) communicating or divulging the information
to a court, the Tribunal or the Small Business
5 Commissioner, or permitting another person
to do so; or
(b) using, communicating or divulging the
information or permitting another person to
do so--
10 (i) in accordance with the consent of both
the landlord and tenant; or
(ii) in a way that does not disclose
information identifying a particular
lease or tenant, or relating to a tenant's
15 business, for the purpose of specifying
the matters to which the valuer had
regard in making the determination
concerned.
(3) A specialist retail valuer who contravenes this
20 section is liable to pay to the landlord or tenant
concerned compensation for any loss or damage
suffered by the landlord or tenant as a result of the
information being used, communicated or
divulged.
25 (4) The amount of the compensation is the amount
that is--
(a) agreed between the valuer and the person
seeking compensation; or
(b) if there is no agreement, determined under
30 Part 10 (Dispute Resolution).
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Division 4--Outgoings
39. Recovery of outgoings from the tenant
(1) The tenant under a retail premises lease is not
liable to pay an amount to the landlord in respect
5 of outgoings except in accordance with provisions
of the lease that specify--
(a) the outgoings that are to be regarded as
recoverable; and
(b) in a manner consistent with the regulations,
10 how the amount of those outgoings will be
determined and how they will be apportioned
to the tenant; and
(c) how those outgoings or any part of them may
be recovered by the landlord from the tenant.
15 (2) The regulations may prescribe the manner in
which the amount of outgoings may be
determined and apportioned to a tenant.
40. Liability to contribute to non-specific outgoings
(1) A tenant under a retail premises lease where the
20 retail premises are located in a retail shopping
centre is only liable to contribute towards an
outgoing of the landlord that benefits specific
retail premises in the centre if the retail premises
are one of the premises that benefit from the
25 outgoing.
(2) A tenant is not liable to contribute towards an
outgoing of the landlord in accordance with sub-
section (1) in excess of an amount calculated as
prescribed by the regulations.
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41. Capital costs not recoverable
A provision in a retail premises lease is void to the
extent that it requires the tenant to pay an amount
in respect of the capital costs of--
5 (a) the building in which the retail premises are
located; or
(b) any building in a retail shopping centre in
which the retail premises are located; or
(c) any areas used in association with a building
10 referred to in paragraph (a) or (b); or
(d) plant in a building referred to in
paragraph (a) or (b).
42. Depreciation not recoverable
A provision in a retail premises lease is void to the
15 extent that it requires the tenant to pay an amount
in respect of depreciation.
43. Tenant not liable to contribute to sinking fund
A provision in a retail premises lease is void to the
extent that it requires the tenant to make a
20 contribution to a sinking fund to provide for
capital works.
44. Interest etc. on landlord's borrowings not recoverable
A provision in a retail premises lease is void to the
extent that it requires the tenant to pay an amount
25 in respect of interest or other charges incurred by
the landlord in respect of amounts borrowed by
the landlord.
45. Rent etc. associated with other land not recoverable
A provision in a retail premises lease is void to the
30 extent that it requires the tenant to pay an amount
in respect of--
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(a) rent payable under any head lease under
which the landlord holds the retail premises;
or
(b) rent or other costs associated with any other
5 land including--
(i) land on which the building or retail
shopping centre of which the retail
premises forms part is located; and
(ii) land of the landlord used by, or for the
10 benefit of, the tenants conducting
business in that building or retail
shopping centre or in connection with
trading in that building or retail
shopping centre.
15 46. Estimate of outgoings
(1) A retail premises lease is taken to provide as set
out in this section.
(2) The landlord must give the tenant a written
estimate of the outgoings to which the tenant is
20 liable to contribute under the lease that itemises
those outgoings.
(3) The tenant must be given the estimate of
outgoings--
(a) before the lease is entered into; and
25 (b) in respect of each of the landlord's
accounting periods during the term of the
lease, at least one month before the start of
that period.
(4) The tenant is not liable to contribute to any
30 outgoings of which an estimate is required to be
given to the tenant as set out in this section until
the tenant is given that estimate.
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47. Statement of outgoings
(1) A retail premises lease is taken to provide as set
out in this section.
(2) The landlord must prepare a written statement that
5 details all expenditure by the landlord, in each of
the landlord's accounting periods during the term
of the lease, on account of outgoings to which the
tenant is liable to contribute.
(3) The landlord must--
10 (a) make the statement available to the tenant at
least once in relation to expenditure during
each of the landlord's accounting periods
during the term of the lease; and
(b) give the tenant the statement within 3 months
15 after the end of the accounting period to
which it relates.
(4) The outgoings statement may relate to more than
one tenant as long as each tenant to which it
relates can ascertain from the statement the details
20 relevant to the tenant.
(5) The outgoings statement must be--
(a) prepared in accordance with relevant
principles and disclosure requirements of
applicable accounting standards (in force
25 from time to time) made by the Australian
Accounting Standards Board; and
(b) in the case of a statement given under sub-
section (3)(b), accompanied by a report
prepared by a registered company auditor
30 (within the meaning of the Corporations Act)
that states whether--
(i) the statement correctly states the
landlord's expenditure during the
accounting period in respect of the total
35 amount of outgoings, and each
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individual outgoing that comprises
more than the prescribed percentage of
the total amount of outgoings, to which
the tenant is liable to contribute; and
5 (ii) the total amount of estimated outgoings
for that period (as shown in the
estimate of outgoings given to the
tenant) exceeded the total actual
expenditure by the landlord in respect
10 of those outgoings during that period.
(6) However, the outgoings statement given under
sub-section (3)(b) need not be accompanied by an
auditor's report if it--
(a) does not relate to any outgoings other than--
15 (i) GST; and
(ii) water, sewerage and drainage rates and
charges; and
(iii) municipal council rates and charges;
and
20 (iv) insurance; and
(v) any other outgoing of a kind prescribed
by the regulations; and
(b) is accompanied by copies of assessments,
invoices, receipts or other proof of payment
25 for all expenditure by the landlord included
in the statement.
(7) An auditor preparing a report under sub-section
(5)(b) must ensure that the tenant is given a
reasonable opportunity to make a written
30 submission to the auditor on the accuracy of the
outgoings statement.
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48. Adjustment of contributions to outgoings
(1) A retail premises lease is taken to provide as set
out in this section.
(2) There is to be an adjustment between the landlord
5 and tenant for each of the landlord's accounting
periods during the term of the lease to take
account of any underpayment or overpayment by
the tenant in respect of outgoings during that
period.
10 (3) The adjustment is to take place--
(a) within one month after the landlord gives the
tenant the outgoings statement under
section 47 for the period; or
(b) within 4 months after the end of the period--
15 whichever is earlier.
(4) The adjustment is to be calculated on the basis of
the difference between--
(a) the total amount of outgoings in respect of
which the tenant contributed (that is, the
20 estimated total expenditure by the landlord
on outgoings during the period); and
(b) the total actual expenditure by the landlord in
respect of those outgoings during the period,
but taking into account only expenditure
25 properly and reasonably incurred by the
landlord in the payment of those outgoings.
49. Limitation on recovery of management fees
(1) A provision of a retail premises lease is void to
the extent that it makes the tenant liable to pay an
30 amount for management fees unless--
(a) the management fees--
(i) relate to the management of the
building in which the retail premises
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are located or, if the retail premises are
located in a retail shopping centre, that
centre; and
(ii) are exclusive of salaries and other
5 administrative costs related to the
operation of that building or centre; and
(b) the lease, or a disclosure statement given to
the tenant in accordance with Part 4,
specifies--
10 (i) the amount of the management fees for
any accounting period of the landlord
during the term of the lease; and
(ii) a rate, or a method for calculating a
rate, for working out the amount for
15 which the tenant is liable for that
period.
(2) If, subject to sub-section (1), a tenant was liable
under a retail premises lease to pay an amount for
management fees for the landlord's previous
20 accounting period, the amount that the tenant is
liable under that lease to pay for the landlord's
current accounting period must not exceed the
greater of the following amounts--
(a) the amount for management fees that the
25 tenant was liable to pay for the previous
accounting period;
(b) the amount calculated using this formula (as
adjusted, if appropriate, by sub-section
(3))--
B
A×
30
C
where--
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"A" is the amount for management fees that
the tenant was liable to pay for the
previous accounting period; and
"B" is the All Groups Consumer Price Index
5 number (for Melbourne) published by
the Australian Statistician for the
quarter in which the current accounting
period started; and
"C" is the All Groups Consumer Price Index
10 number (for Melbourne) published by
the Australian Statistician for the
quarter in which the previous
accounting period started.
(3) The amount calculated using the formula in
15 sub-section (2)(b) is adjusted--
(a) if the tenant was liable for management fees
for only part of the previous accounting
period, by--
(i) multiplying the amount by the total
20 number of days in the previous
accounting period; and
(ii) dividing that result by the number of
days in the part of the previous
accounting period for which the tenant
25 was liable for management fees; and
(b) if the tenant is liable for management fees
for only part of the current accounting
period, by--
(i) multiplying the amount by the number
30 of days in the part of the current
accounting period for which the tenant
is liable for management fees; and
(ii) dividing that result by the total number
of days in the current accounting
35 period.
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(4) Where the retail premises are located in a retail
shopping centre, if one-half of the tenants in the
centre who are liable under retail premises leases
to pay an amount for management fees for an
5 accounting period of the landlord agree in writing
that sub-section (2) is not to apply in respect of
that period, that sub-section does not apply to any
of the tenants in that centre in respect of that
period.
10 (5) If the Australian Statistician changes the reference
base for the All Groups Consumer Price Index
number (for Melbourne) for a quarter mentioned
in sub-section (2), the new reference base is to be
used after the change.
15 50. Recovery of land tax
A provision of a retail premises lease is void to
the extent that it makes the tenant liable to pay an
amount for tax for which the landlord is liable
under the Land Tax Act 1958.
20 Note: The application of this section is affected by section 121
(notification of amount of land tax).
51. Liability for costs associated with lease
(1) A landlord under a retail premises lease is not able
to claim from any person (including the tenant)
25 the landlord's legal or other expenses relating to--
(a) the negotiation, preparation or execution of
the lease; or
(b) obtaining the consent of a mortgagee to the
lease; or
30 (c) the landlord's compliance with this Act.
(2) However, sub-section (1) does not prevent a
landlord from claiming the reasonable legal or
other expenses incurred by the landlord in
connection with an assignment of the lease or a
35 sub-lease, including investigating a proposed
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assignee or sub-tenant and obtaining any
necessary consents to the assignment or sub-lease.
52. Landlord's liability for repairs
(1) A retail premises lease is taken to provide as set
5 out in this section.
(2) The landlord is responsible for maintaining in
good repair--
(a) the structure of, or fixtures in, the retail
premises; and
10 (b) plant or equipment at the retail premises; and
(c) the appliances, fittings or fixtures provided
under the lease by the landlord relating to the
gas, electricity, water, drainage or other
services.
15 (3) However, the landlord is not responsible for
maintaining those things in good repair if--
(a) the need for the repair arises out of misuse
by the tenant; or
(b) the tenant is entitled or required to remove
20 the thing at the end of the lease.
(4) The tenant may arrange for urgent repairs (for
which the landlord is responsible) to be carried
out to those things if--
(a) the repairs are necessary to fix or remedy a
25 fault or damage that has or causes a
substantial effect on or to the tenant's
business at the premises; and
(b) the tenant is unable to get the landlord or the
landlord's agent to carry out the repairs
30 despite having taken reasonable steps to
arrange for the landlord or agent to do so.
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(5) If the tenant carries out those repairs--
(a) the tenant must give the landlord written
notice of the repairs and the cost within
14 days after the repairs are carried out; and
5 (b) the landlord is liable to reimburse the tenant
for the reasonable cost of the repairs.
__________________
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PART 6--REFURBISHMENT, RELOCATION AND OTHER
INTERFERENCES WITH TENANCY
Division 1--Refurbishment, Relocation etc.
53. Landlord to give notice of alterations and
5 refurbishments
A retail premises lease is taken to provide that the
landlord must not start to carry out any alteration
or refurbishment of the building or retail shopping
centre in which the retail premises are located
10 which is likely to affect adversely the business of
the tenant unless--
(a) the landlord has notified the tenant in writing
of the proposed alteration or refurbishment at
least 60 days before it is started; or
15 (b) the alteration or refurbishment is necessary
because of an emergency and the landlord
has given the tenant the maximum period of
notice that is reasonably practicable in the
circumstances.
20 54. Tenant to be compensated for interference
(1) A retail premises lease is taken to provide as set
out in this section.
(2) The landlord is liable to pay to the tenant
reasonable compensation for loss or damage
25 (other than nominal damage) suffered by the
tenant because the landlord or a person acting on
the landlord's behalf--
(a) substantially inhibits the tenant's access to
the retail premises; or
30 (b) unreasonably takes action that substantially
inhibits or alters the flow of customers to the
retail premises; or
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(c) unreasonably takes action that causes
significant disruption to the tenant's trading
at the retail premises; or
(d) fails to take reasonable steps to prevent or
5 stop significant disruption within the
landlord's control to the tenant's trading at
the retail premises; or
(e) fails to rectify as soon as practicable--
(i) any breakdown of plant or equipment
10 that is not under the tenant's care or
maintenance; or
(ii) any defect in the retail premises or in
the building or retail shopping centre in
which the retail premises are located,
15 other than a defect due to a condition
that would have been reasonably
apparent to the tenant when entering
into or renewing the lease or when the
tenant accepted assignment of the lease;
20 or
(f) neglects adequately to clean, maintain or
repair the building or retail shopping centre
in which the retail premises are located (but
not the retail premises themselves).
25 (3) The tenant must give the landlord written notice
of the loss or damage as soon as practicable after
it is suffered but a failure to do this does not affect
any right of the tenant to compensation.
(4) This section does not apply to action taken by a
30 landlord--
(a) as a reasonable response to an emergency; or
(b) in compliance with any duty imposed by or
under an Act or resulting from a requirement
imposed by a body acting under the authority
35 of an Act.
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(5) The amount of the compensation is the amount
that is--
(a) agreed between the landlord and the tenant;
or
5 (b) if there is no agreement, determined under
Part 10 (Dispute Resolution).
55. Relocation of the tenant's business
(1) A retail premises lease that provides for--
(a) relocation of the tenant's business; or
10 (b) termination of the lease and offer of a new
lease of alternative retail premises--
is taken to provide as set out in this section.
(2) The landlord cannot require the tenant's business
to be relocated or terminate the lease and offer a
15 new lease of alternative retail premises unless the
landlord has provided the tenant with details of a
proposed refurbishment, redevelopment or
extension that are sufficient to indicate a genuine
proposal that--
20 (a) is to be carried out within a reasonably
practicable time after the relocation; and
(b) cannot be carried out practicably without
vacant possession of the retail premises.
(3) The landlord cannot require the tenant's business
25 to be relocated or terminate the lease and offer a
new lease of alternative retail premises unless the
landlord has given the tenant at least 3 months'
written notice of the relocation with details of
alternative comparable retail premises to be made
30 available to the tenant.
(4) The tenant is entitled to be offered a new lease of
the alternative retail premises on the same terms
and conditions as the existing lease except that--
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(a) the term of the new lease is to be the same as
the remaining term of the existing lease; and
(b) the rent for the alternative retail premises is
to be the same as the rent for the existing
5 retail premises, adjusted to take into account
the difference in the commercial values of
the premises at the time of relocation.
(5) Within one month after being given a relocation
notice, the tenant may give the landlord a written
10 notice of termination and the lease terminates
3 months after the relocation notice was given or
at such other time as the landlord and tenant
agree.
(6) If the tenant does not give a notice of termination
15 in accordance with sub-section (5), the tenant is
taken to have accepted the offer of a lease--
(a) on the terms and conditions referred to in
sub-section (4); or
(b) on the terms and conditions that are agreed
20 by the landlord and tenant.
(7) The tenant is entitled to payment by the landlord
of the tenant's reasonable costs of the relocation,
including (but not limited to) the costs of
dismantling and reinstalling or modifying or
25 replacing any fixtures and fittings and legal costs.
(8) If the landlord and tenant cannot agree on the
amount to which the tenant is entitled under sub-
section (7), that amount is to be determined by an
independent quantity surveyor appointed by--
30 (a) agreement between the landlord and tenant;
or
(b) if there is no agreement, the Small Business
Commissioner--
and the landlord and tenant are to pay the costs of
35 the independent quantity surveyor in equal shares.
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(9) The landlord is not liable to pay an amount under
sub-section (7) that is more than the amount
agreed by the landlord and tenant, or determined
by the independent quantity surveyor, as the case
5 may be.
Note: This section sets out what the tenant is entitled to but does
not prevent the tenant from accepting other arrangements
when the details of a relocation are being negotiated.
56. Demolition
10 (1) A retail premises lease that provides for
termination of the lease on the ground of proposed
demolition of the building in which the retail
premises are located is taken to provide as set out
in this section.
15 (2) The landlord cannot terminate the lease on that
ground unless the landlord has--
(a) provided the tenant with details of the
proposed demolition that are sufficient to
indicate a genuine proposal to demolish the
20 building within a reasonably practicable time
after the lease is to be terminated; and
(b) given the tenant at least 6 months' written
notice of the termination date.
(3) If the landlord gives the tenant a notice of
25 termination in accordance with sub-section (2),
the tenant may terminate the lease before the
termination date by giving the landlord not less
than 7 days' written notice.
(4) If the lease is terminated by the landlord in
30 accordance with sub-section (2), the landlord is
liable to pay the tenant reasonable
compensation--
(a) if the demolition of the building is not
carried out, or not carried out within a
35 reasonably practicable time after the
termination date, for damage suffered by the
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tenant as a consequence of the early
termination of the lease; and
(b) whether or not the demolition of the building
is carried out, for the fit out of the retail
5 premises to the extent that the fit out was not
provided by the landlord.
(5) However, the landlord is not liable to pay
compensation for the damage mentioned in
sub-section (4)(a) if the landlord establishes that
10 when the notice was given there was a genuine
proposal to demolish the premises within a
reasonably practicable time after the termination
date.
(6) The amount of the compensation is the amount
15 that is--
(a) agreed between the landlord and the tenant;
or
(b) if there is no agreement, determined under
Part 10 (Dispute Resolution).
20 (7) For the purposes of this section, "demolition" of
the building in which retail premises are located
includes any substantial repair, renovation or
reconstruction of the building that cannot
practicably be carried out without vacant
25 possession of the premises.
57. Damaged premises
(1) A retail premises lease is taken to provide the
following if the retail premises, or the building in
which the premises are located, is damaged--
30 (a) except where the tenant caused the damage,
the tenant is not liable to pay rent, or any
amount in respect of outgoings or other
charges, that is attributable to any period
during which the premises cannot be used
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s. 57
under the lease or are inaccessible due to that
damage; and
(b) except where the tenant caused the damage,
if the premises can be used under the lease
5 but that use is reduced to some extent by the
damage, the tenant's liability for rent, and
any amount in respect of outgoings or other
charges, that is attributable to any period
during which the use is reduced is decreased
10 to the same extent; and
(c) if the landlord reasonably considers that the
extent of damage makes its repair
impracticable or undesirable and notifies the
tenant in writing of that, the landlord or
15 tenant may terminate the lease by giving not
less than 7 days' written notice of
termination to the other party; and
(d) if the landlord fails to repair the damage
within a reasonable time after the tenant asks
20 the landlord in writing to do so, the tenant
may terminate the lease by giving not less
than 7 days' written notice of termination to
the landlord; and
(e) this sub-section does not affect any right of
25 the landlord to recover damages from the
tenant in respect of any damage covered by
this sub-section.
(2) A provision of a retail premises lease is void to
the extent that it has the effect of limiting the
30 liability of a party to the lease to pay
compensation to another party to the lease in
respect of damage to the retail premises or the
building in which the premises are located.
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(3) Nothing in this section prevents the parties to a
lease from terminating the lease by agreement if
the retail premises or the building in which the
premises are located is damaged or destroyed.
5 58. Refurbishment and refitting
A provision in a retail premises lease requiring the
tenant to refurbish or refit the retail premises is
void unless it gives such details of the
refurbishment or refitting as are necessary to
10 indicate generally its nature, extent and timing.
Division 2--Other Interferences with Tenancy
59. Restriction on whom the tenant employs or engages
(1) A provision in a retail premises lease is void to the
extent that it limits or has the effect of limiting the
15 tenant's right to employ or engage persons the
tenant chooses.
(2) However, sub-section (1) does not prevent the
lease from containing provisions that--
(a) specify minimum standards of competence
20 and behaviour for persons employed in the
retail premises or other persons (such as
contractors) doing work there; or
(b) prohibit work from being carried out on
specified items of the landlord's property; or
25 (c) if the retail premises are located in a retail
shopping centre, require the tenant to comply
with any award or agreement (for example, a
construction site agreement) affecting the
centre.
__________________
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Retail Leases Act 2003
Act No.
Part 7--Assignment and Termination of a Retail Premises Lease
s. 60
PART 7--ASSIGNMENT AND TERMINATION OF A RETAIL
PREMISES LEASE
60. When the landlord can withhold consent to an
assignment
5 (1) A landlord is only entitled to withhold consent to
the assignment of a retail premises lease if one or
more of the following applies--
(a) the proposed assignee proposes to use the
retail premises in a way that is not permitted
10 under the lease;
(b) the landlord considers that the proposed
assignee does not have sufficient financial
resources or business experience to meet the
obligations under the lease;
15 (c) the proposed assignor has not complied with
reasonable assignment provisions of the
lease;
(d) the proposed assignor has not provided the
proposed assignee with business records for
20 the previous 3 years or such shorter period as
the proposed assignor has carried on
business at the retail premises.
(2) Section 144 of the Property Law Act 1958 does
not apply to or with respect to a retail premises
25 lease to which this Act applies.
61. Procedure for obtaining consent to assignment
(1) A retail premises lease is taken to provide as set
out in this section.
(2) A request for the landlord's consent to an
30 assignment of the lease must be in writing and the
tenant must provide the landlord with such
information as the landlord reasonably requires
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about the financial resources and business
experience of the proposed assignee.
(3) Before requesting the landlord's consent, the
tenant must give the proposed assignee--
5 (a) a copy of any disclosure statement given to
the tenant concerning the lease; and
(b) details of any changes of which the tenant is
aware, or could reasonably be expected to be
aware, that have affected the information in
10 the disclosure statement since it was given to
the tenant.
Penalty: 10 penalty units.
(4) If the assignment is in connection with the lease of
retail premises that will continue to be used for the
15 carrying on of an ongoing business, the tenant
must give the landlord and the proposed assignee
a disclosure statement in the form prescribed by
the regulations (but the layout of the statement
need not be the same as the prescribed disclosure
20 statement).
(5) For the purpose of complying with sub-section
(3), the tenant may ask the landlord to give the
tenant a disclosure statement that is current from a
specified date that is within 3 months before the
25 statement is given and, if the landlord does not
give the tenant such a statement within 14 days--
(a) the tenant is not required to comply with that
sub-section; and
(b) the landlord is guilty of an offence and liable
30 to a fine not exceeding 10 penalty units.
(6) The landlord must deal expeditiously with a
request for consent and is taken to have consented
to the assignment if--
(a) the tenant has complied with this section;
35 and
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(b) the landlord has not, within 28 days after the
request was made, given written notice to the
tenant consenting or withholding consent.
62. Protection of assignors and guarantors
5 (1) This section applies if--
(a) a tenant gives a landlord and proposed
assignee a copy of a disclosure statement in
accordance with section 61(4); and
(b) the disclosure statement does not contain any
10 information that is false, misleading or
materially incomplete.
(2) None of the following persons are liable to pay to
the landlord any money in respect of amounts
payable by the proposed assignee--
15 (a) the tenant;
(b) a guarantor or covenantor of the tenant.
63. Landlord may reserve the right to refuse a sub-lease,
mortgage etc.
A retail premises lease may contain a provision
20 which allows the landlord an absolute discretion
to refuse consent to--
(a) the grant of a sub-lease, licence or
concession in respect of all or part of the
retail premises; or
25 (b) the tenant parting with occupancy rights to
all or part of the retail premises; or
(c) the tenant mortgaging or otherwise charging
or encumbering the tenant's estate or interest
in the lease.
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64. Notice of the landlord's intentions concerning
renewal
(1) This section applies if the tenant under a retail
premises lease does not have an option under the
5 lease to renew the lease for a further term.
(2) The landlord must, at least 6 months but no more
than 12 months before the lease term ends, give
written notice to the tenant--
(a) offering the tenant a renewal of the lease on
10 the terms specified in the notice (including a
term setting out the rent); or
(b) informing the tenant that the landlord does
not propose to offer the tenant a renewal of
the lease.
15 (3) An offer to renew the lease cannot be revoked
without the tenant's consent for 60 days after it is
made.
(4) If the landlord fails to comply with sub-section
(2)--
20 (a) the landlord must give the tenant a notice
containing the same information as the
notice the landlord was required to give
under sub-section (2); and
(b) the lease continues (on the same terms and
25 conditions as applied immediately before the
lease term ends) until--
(i) the day specified in the notice that the
landlord is required to give under
paragraph (a) (which must be at least
30 6 months after the notice is given to the
tenant); or
(ii) if the tenant gives the landlord a notice
under sub-section (5), the day specified
in that notice.
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(5) If the landlord fails to comply with sub-section
(2), the tenant may, at any time before the
landlord gives the tenant a notice under
sub-section (4)(a), give written notice to the
5 landlord terminating the lease from a day that is
not earlier than the day on which the term of the
lease expires.
__________________
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Retail Leases Act 2003
Act No.
Part 8--Additional Requirements for Retail Shopping Centres
s. 65
PART 8--ADDITIONAL REQUIREMENTS FOR RETAIL
SHOPPING CENTRES
65. Part only applies to retail shopping centres
This Part only applies to retail premises located in
5 retail shopping centres (and applies in addition to
the other provisions of this Act).
66. Changes to core trading hours
A retail premises lease that provides that the
tenant's business must be open for trading during
10 the core trading hours of the retail shopping centre
is taken to provide that the landlord cannot change
those hours unless a majority of the tenants in the
retail shopping centre who hold a retail premises
lease agree in writing to the landlord doing so.
15 67. Confidentiality of turnover information
(1) A landlord under a retail premises lease must not
divulge or communicate to any person any
information about the turnover of the tenant's
business provided by the tenant in accordance
20 with the lease.
Penalty: 20 penalty units.
(2) However, sub-section (1) does not prevent the
landlord communicating or divulging any
information--
25 (a) with the tenant's consent; or
(b) in a document giving aggregate turnover
information about the retail shopping centre
in which the retail premises are located in a
way that does not disclose information
30 relating to the turnover of a particular
tenant's business; or
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(c) to a court, the Tribunal or the Small Business
Commissioner, or for the purposes of any
dispute resolution or valuation, for the
purposes of this Act or the lease; or
5 (d) in compliance with a requirement of or under
an Act; or
(e) in good faith to any of the following persons
in a way that does not disclose information
identifying a particular lease or tenant, or
10 relating to a tenant's business--
(i) the landlord's professional advisers
(such as legal or financial advisers); or
(ii) the proper officer of any financial
institution for the purpose of enabling
15 the landlord to obtain financial
accommodation; or
(iii) a prospective purchaser of the retail
premises or the building in which the
premises are located.
20 68. Availability of statistical information about the retail
shopping centre
If a retail premises lease requires the tenant to pay
an amount in respect of outgoings on account of
expenditure incurred by the landlord in obtaining
25 statistical information about the operation or
performance of the retail shopping centre in which
the premises are located, the lease is taken to
provide that the landlord must, at the request of
the tenant, make the statistical information
30 available to the tenant.
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s. 69
69. Advertising and promotion requirements
(1) A provision in a retail premises lease is void to the
extent that it requires the tenant to undertake any
advertising or promotion of the tenant's business.
5 (2) However, sub-section (1) does not apply to a
provision that requires a payment to the landlord
for advertising or promotion costs incurred or to
be incurred by the landlord.
70. Marketing plan for advertising and promotion
10 (1) A retail premises lease that requires the tenant to
pay an amount to the landlord for advertising or
promotion costs is taken to provide as set out in
this section.
(2) At least one month before the start of each
15 accounting period of the landlord, the landlord
must make available to the tenant a marketing
plan that gives details of the landlord's proposed
expenditure on advertising and promotion during
that accounting period.
20 (3) If the tenant's payment relates to an opening
promotion, at least one month before that opening
promotion the landlord must make available to the
tenant details of the proposed expenditure on the
promotion.
25 71. Statement and report on advertising and promotion
expenditure
(1) A retail premises lease is taken to provide as set
out in this section.
(2) The landlord must prepare a written statement that
30 details all expenditure by the landlord in each
accounting period of the landlord during the term
of the lease on account of advertising or
promotion costs to which the tenant is required to
contribute under the lease.
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(3) The advertising and promotion statement must
be--
(a) made available to the tenant at least once for
expenditure during each of the landlord's
5 accounting periods during the term of the
lease; and
(b) given to the tenant within 3 months after the
end of the accounting period to which it
relates; and
10 (c) in the case of a statement given under
paragraph (b), accompanied by a report
prepared by a registered company auditor
(within the meaning of the Corporations Act)
that confirms whether the statement correctly
15 states the landlord's expenditure during the
accounting period in respect of advertising or
promotion costs to which the tenant is
required to contribute.
(4) The advertising and promotion statement must be
20 prepared in accordance with relevant principles
and disclosure requirements of applicable
accounting standards (in force from time to time)
made by the Australian Accounting Standards
Board.
25 72. Unspent advertising and promotion contributions
(1) A retail premises lease is taken to provide that an
amount that is--
(a) contributed, under a retail premises lease, by
a tenant in the retail shopping centre in
30 which the retail premises are located in
respect of the landlord's advertising or
promotion costs; and
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(b) not spent in respect of those costs--
must be carried forward by the landlord to be
applied towards future expenditure on advertising
or promotion of the centre.
5 (2) When the lease ends, there is to be an adjustment
between the landlord and tenant for the term of the
lease to take account of any underpayment or
overpayment by the tenant in respect of
expenditure on advertising or promotion of the
10 centre.
(3) The adjustment is to be made--
(a) in accordance with the regulations; and
(b) within 4 months after the end of the lease.
73. Termination by landlord for inadequate sales
15 prohibited
A provision in a retail premises lease is void to the
extent that it permits or otherwise provides for the
termination of the lease by the landlord on the
ground that the tenant or the tenant's business has
20 failed to achieve specified sales or turnover
performance.
74. Geographical restrictions on tenant prohibited
(1) A provision in a retail premises lease is void to the
extent that it has the effect of preventing or
25 restricting the tenant from carrying on business
outside the retail shopping centre in which the
retail premises are located, either during the term
of the lease or after its expiry.
(2) Sub-section (1) does not prevent a lease or other
30 agreement from containing a provision that
prevents the use of the name of the retail shopping
centre in connection with a business carried on
outside the centre.
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75. Tenants' associations etc.
(1) A provision in a retail premises lease is void to the
extent that it has the effect of preventing or
restricting the tenant from forming, joining or
5 taking part in any activities of a tenants'
association, chamber of commerce or similar
body.
(2) A landlord under a retail premises lease must not
treat or propose to treat a tenant who--
10 (a) forms or joins; or
(b) proposes to form or join--
a tenants' association, chamber of commerce or
similar body less favourably than a tenant in
similar circumstances who does not do or propose
15 to do any of those things.
__________________
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Retail Leases Act 2003
Act No.
Part 9--Unconscionable Conduct
s. 76
PART 9--UNCONSCIONABLE CONDUCT
76. Application of Part
(1) In addition to a retail premises lease to which this
Part applies because of Part 3, this Part also
5 applies to a retail premises lease that was entered
into or renewed before the commencement of this
section if this Act would have applied to the lease
had it been entered into or renewed after that
commencement.
10 (2) This Part does not apply to conduct that occurred
before the commencement of this section.
77. Unconscionable conduct of a landlord
(1) A landlord under a retail premises lease must not,
in connection with the lease, engage in conduct
15 that is, in all the circumstances, unconscionable.
Note: Section 78 deals with unconscionable conduct by a
tenant.
(2) Without limiting the matters to which the
Tribunal may have regard for the purpose of
20 determining whether a landlord has contravened
sub-section (1), the Tribunal may have regard
to--
(a) the relative strengths of the bargaining
positions of the landlord and tenant; and
25 (b) whether, as a result of conduct engaged in by
the landlord, the tenant was required to
comply with conditions that were not
reasonably necessary for the protection of
the landlord's legitimate interests; and
30 (c) whether the tenant was able to understand
any documents relating to the lease; and
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(d) whether any undue influence or pressure was
exerted on, or any unfair tactics were used
against, the tenant or a person acting on the
tenant's behalf by the landlord or a person
5 acting on the landlord's behalf in relation to
the lease, for example--
(i) concerning trading on Sundays or days
that are public holidays where the
premises are located; or
10 (ii) to agree to a lease term of less than
5 years; and
(e) the amount for which, and the circumstances
under which, the tenant could have acquired
an identical or equivalent lease from a person
15 other than the landlord; and
(f) the extent to which the landlord's conduct
towards the tenant was consistent with the
landlord's conduct in similar transactions
between the landlord and other similar
20 tenants; and
(g) the requirements of any applicable industry
code; and
(h) the requirements of any other industry code,
if the tenant acted on the reasonable belief
25 that the landlord would comply with that
code; and
(i) the extent to which the landlord
unreasonably failed to disclose to the
tenant--
30 (i) any intended conduct of the landlord
that might affect the tenant's interests;
and
(ii) any risks to the tenant arising from the
landlord's intended conduct that are
35 risks that the landlord should have
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foreseen would not be apparent to the
tenant; and
(j) the extent to which the landlord was willing
to negotiate the terms and conditions of any
5 lease with the tenant; and
(k) the extent to which the landlord acted in
good faith; and
(l) the extent to which the landlord was not
reasonably willing to negotiate the rent under
10 the lease; and
(m) the extent to which the landlord
unreasonably used information about the
turnover of the tenant's or a previous tenant's
business to negotiate the rent; and
15 (n) the extent to which the landlord required the
tenant to incur unreasonable fit out costs.
(3) In considering whether a landlord has contravened
sub-section (1), the Tribunal--
(a) must not have regard to any circumstances
20 that were not reasonably foreseeable at the
time of the alleged contravention; and
(b) may have regard to circumstances existing
before the commencement of this section but
not to conduct engaged in before that
25 commencement.
78. Unconscionable conduct of a tenant
(1) A tenant under a retail premises lease must not, in
connection with the lease, engage in conduct that
is, in all the circumstances, unconscionable.
30 (2) Without in any way limiting the matters to which
the Tribunal may have regard for the purpose of
determining whether a tenant has contravened
sub-section (1), the Tribunal may have regard
to--
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(a) the relative strengths of the bargaining
positions of the tenant and landlord; and
(b) whether, as a result of conduct engaged in by
the tenant, the landlord was required to
5 comply with conditions that were not
reasonably necessary for the protection of
the tenant's legitimate interests; and
(c) whether the landlord was able to understand
any documents relating to the lease; and
10 (d) whether any undue influence or pressure was
exerted on, or any unfair tactics were used
against, the landlord or a person acting on
the landlord's behalf by the tenant or a
person acting on the tenant's behalf in
15 relation to the lease; and
(e) the amount for which, and the circumstances
under which, the landlord could have granted
an identical or equivalent lease to a person
other than the tenant; and
20 (f) the extent to which the tenant's conduct
towards the landlord was consistent with the
tenant's conduct in similar transactions
between the tenant and other similar
landlords; and
25 (g) the requirements of any applicable industry
code; and
(h) the requirements of any other industry code,
if the landlord acted on the reasonable belief
that the tenant would comply with that code;
30 and
(i) the extent to which the tenant unreasonably
failed to disclose to the landlord--
(i) any intended conduct of the tenant that
might affect the landlord's interests; and
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(ii) any risks to the landlord arising from
the tenant's intended conduct that are
risks that the tenant should have
foreseen would not be apparent to the
5 landlord; and
(j) the extent to which the tenant was willing to
negotiate the terms and conditions of any
lease with the landlord; and
(k) the extent to which the tenant acted in good
10 faith; and
(l) the extent to which the tenant was not
reasonably willing to negotiate the rent under
the lease; and
(m) the extent to which the tenant unreasonably
15 used information about the turnover of the
tenant's or a previous tenant's business to
negotiate the rent; and
(n) the extent to which the tenant was willing to
incur reasonable fit out costs.
20 (3) In considering whether a tenant has contravened
sub-section (1), the Tribunal--
(a) must not have regard to any circumstances
that were not reasonably foreseeable at the
time of the alleged contravention; and
25 (b) may have regard to circumstances existing
before the commencement of this section but
not to conduct engaged in before that
commencement.
79. Certain conduct is not unconscionable
30 A person is not to be taken for the purposes of
section 77 or 78 to engage in unconscionable
conduct in connection with a retail premises lease
merely because--
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(a) the person institutes proceedings in relation
to the lease or refers a dispute, application or
claim relating to the lease to arbitration,
conciliation, mediation or some other form
5 of alternative dispute resolution; or
(b) the person fails to renew the lease or enter
into a new lease; or
(c) the person does not agree to having an
independent valuation of current market rent
10 carried out.
80. Recovery of amount for loss or damage
(1) A landlord or tenant, or former landlord or tenant,
who suffers loss or damage because of
unconscionable conduct of another person that
15 contravenes section 77 or 78 may recover the
amount of the loss or damage by lodging a claim
with the Tribunal against the other person.
(2) The claim must be lodged within 6 years after the
alleged unconscionable conduct occurred.
20 (3) If the matter of the loss or damage arises in
connection with proceedings in the Tribunal, the
Tribunal may proceed to decide the matter and
award a sum that it considers appropriate.
__________________
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Act No.
Part 10--Dispute Resolution
s. 81
PART 10--DISPUTE RESOLUTION
Division 1--Retail Tenancy Disputes
81. Meaning of "retail tenancy dispute"
(1) In this Part, "retail tenancy dispute" means a
5 dispute between a landlord and tenant--
(a) arising under or in relation to a retail
premises lease to which--
(i) this Act applies or applied because of
Part 3; or
10 (ii) the Retail Tenancies Reform Act
1998 or the Retail Tenancies Act 1986
applies or applied; or
(b) arising under a provision of the Retail
Tenancies Reform Act 1998 or the Retail
15 Tenancies Act 1986 in relation to a lease to
which that Act applies or applied; or
(c) arising under a lease that provides for the
occupation of retail premises in Victoria to
which none of those Acts apply or applied--
20 despite anything to the contrary in this Act (apart
from sub-section (2) and section 119(2)).
Note: If proceedings were in progress under the Retail
Tenancies Reform Act 1998 when this Act
commenced, see section 119(2) (general transitional
25 and savings).
(2) However, "retail tenancy dispute" does not
include a dispute solely relating to the payment of
rent or a dispute that is capable of being
determined by a specialist retail valuer under
30 section 34 or 37.
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82. Application of Part to retail premises
In this Part, a lease of retail premises includes a
lease of premises that are retail premises at any
time during the lease but before a referral under
5 section 86 is made in relation to that lease
(whether or not the premises are retail premises
when that referral is made).
83. Part applies to current and former leases
In this Part--
10 "landlord" includes a former landlord;
"lease" includes a former lease;
"tenant" includes a former tenant.
Division 2--The Small Business Commissioner
84. Functions of Small Business Commissioner
15 (1) The Small Business Commissioner has the
following functions under this Act--
(a) to make arrangements to facilitate the
resolution by mediation, or by another
appropriate form of alternative dispute
20 resolution, of retail tenancy disputes
(whether or not a dispute has been formally
referred under this Act to the
Commissioner);
(b) to take proceedings for an offence against
25 this Act;
(c) to report to the Minister on the operation of
this Act;
(d) to authorise, if the Commissioner considers
it appropriate to do so, a body to represent
30 that the form of a standard lease that the
body is to make available to the public
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(whether or not for a fee) is endorsed by the
Commissioner;
(e) to confirm whether a certificate has been
given in accordance with section 21(5);
5 (f) to prepare and publish an information
booklet or guidelines about retail leases that
may be purchased on demand by members of
the public;
(g) for the purposes only of the Commissioner
10 performing his or her functions under this
Act, to create and maintain a register of the
information provided under section 25;
(h) such other functions as may be conferred or
imposed on the Commissioner by or under
15 this Act.
(2) In arranging for the resolution of retail tenancy
disputes, the Commissioner is to have regard to
the need for the mediation or other form of
alternative dispute resolution to be conducted by
20 persons who are experienced in the field of retail
premises leases.
(3) The Commissioner may himself or herself
conduct a mediation or other form of alternative
dispute resolution and is entitled to be paid his or
25 her fees and expenses for doing so, which must
not be more than the maximum amount (if any)
prescribed by the regulations.
(4) The Commissioner may charge a fee for giving an
authorisation under sub-section (1)(d), which must
30 not be more than the maximum fee (if any)
prescribed by the regulations.
(5) The Commissioner is not subject to the Minister's
control or direction in exercising functions under
sub-section (1)(a) or (b).
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Part 10--Dispute Resolution
s. 85
Division 3--Alternative Dispute Resolution
85. What mediation and other alternative dispute
resolution covers
Mediation and other forms of alternative dispute
5 resolution under this Part are not limited to formal
mediation procedures but extend to preliminary
assistance in dispute resolution, such as the giving
of advice designed to ensure that--
(a) the parties are fully aware of their rights and
10 obligations; and
(b) there is full and open communication
between the parties concerning the matter.
86. Referral of retail tenancy disputes for alternative
dispute resolution
15 (1) Any or all of the parties to a retail premises lease
may refer a retail tenancy dispute to the Small
Business Commissioner for mediation.
(2) The referral must be accompanied by the
application fee, which must not be more than the
20 maximum fee (if any) prescribed by the
regulations.
Note: The parties may ask the Commissioner for
preliminary assistance before referring the retail
tenancy dispute (see section 85).
25 (3) The Commissioner must arrange for each retail
tenancy dispute referred in accordance with this
section to be the subject of--
(a) mediation by a mediator; or
(b) another appropriate form of alternative
30 dispute resolution by a suitably qualified
person.
(4) A party to a mediation or another form of
alternative dispute resolution may be represented
by a legal practitioner but the mediator or person
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conducting the other form of alternative dispute
resolution may, if he or she considers it
appropriate to do so, meet with the party (alone or
together with any other party) without their legal
5 representative being present.
(5) The costs of, and associated with, mediation by a
mediator, or another form of alternative dispute
resolution by a suitably qualified person
(including the fees and expenses of the mediator
10 or person conducting the other form of alternative
dispute resolution) are to be determined by the
mediator or that other person and paid by the
parties in the proportions that they agree among
themselves or, if they cannot agree, in equal
15 shares.
(6) A mediator or person conducting another form of
alternative dispute resolution is not civilly or
criminally liable in respect of the performance, in
good faith, of the functions of a mediator or such a
20 person under this Act.
87. Retail tenancy disputes must first be referred for
alternative dispute resolution
(1) A retail tenancy dispute may only be the subject
of proceedings before the Tribunal (whether under
25 this Act, the Fair Trading Act 1999 or any other
Act) if the Small Business Commissioner has
certified in writing that mediation or another
appropriate form of alternative dispute resolution
under this Part has failed, or is unlikely, to resolve
30 it.
(2) This section does not apply to proceedings for an
order in the nature of an injunction.
(3) This section does not affect the validity of any
decision made by the Tribunal.
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88. Statements made during alternative dispute resolution
not admissible
A statement or admission made in the course of a
mediation or another form of alternative dispute
5 resolution under this Part is not admissible in
proceedings under Division 4 or in any other legal
proceedings.
Division 4--The Tribunal
89. Jurisdiction of Tribunal
10 (1) The Tribunal has jurisdiction to hear and
determine an application by a landlord or tenant
under a retail premises lease, or by a specialist
retail valuer, seeking resolution of a retail tenancy
dispute.
15 (2) In an application under sub-section (1) for
forfeiture or relief against forfeiture (whether or
not for non-payment of rent), the Tribunal has the
same jurisdiction, including equitable jurisdiction,
and powers as the Supreme Court has in relation
20 to proceedings for forfeiture or relief against
forfeiture.
(3) The Tribunal's powers under sub-section (2) are
subject to section 92 (which provides that each
party to the application is to bear its own costs).
25 (4) Subject to section 23(4) (key-money and goodwill
payments prohibited), a retail tenancy dispute
other than--
(a) an application for relief against forfeiture; or
(b) a claim under Part 9 (Unconscionable
30 Conduct)--
is not justiciable before any other tribunal or a
court or person acting judicially within the
meaning of the Evidence Act 1958.
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(5) The Tribunal also has jurisdiction to hear and
determine any other application that under this
Act, the Retail Tenancies Reform Act 1998 or
the Retail Tenancies Act 1986 may be made to
5 the Tribunal.
90. Parties to proceeding
The parties to a proceeding before the Tribunal on
an application under section 89(1) are--
(a) the applicant; and
10 (b) the other party to the dispute; and
(c) any person the Tribunal considers it
appropriate to join as a party to the
proceeding.
91. Orders the Tribunal can make
15 (1) The Tribunal may, in a proceeding under this Part,
make one or more orders--
(a) requiring a party to do, or not to do, anything
including to provide specified facilities,
services, fixtures or fittings under a retail
20 premises lease or to return specified fixtures
or fittings to another party; or
(b) requiring a party to pay money, by way of
restitution or compensation or otherwise, to a
specified person; or
25 (c) rectifying a retail premises lease or other
document; or
(d) granting recovery of possession of the retail
premises to the landlord; or
(e) requiring anything else to be done that it--
30 (i) is empowered to require to be done
under this Act or the Victorian Civil
and Administrative Tribunal Act
1998; or
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(ii) considers necessary or desirable to
resolve the matter concerned.
(2) In ordering the payment of a sum of money by a
party, the Tribunal may order the payment of
5 interest on that sum by the party at the rate fixed
from time to time under section 2 of the Penalty
Interests Rates Act 1983 or at any lesser rate it
thinks appropriate.
92. Each party bears its own costs
10 (1) Despite anything to the contrary in Division 8 of
Part 4 of the Victorian Civil and Administrative
Tribunal Act 1998, each party to a proceeding
before the Tribunal under this Part is to bear its
own costs in the proceeding.
15 (2) However, at any time the Tribunal may make an
order that a party pay all or a specified part of the
costs of another party in the proceeding but only if
the Tribunal is satisfied that it is fair to do so
because--
20 (a) the party conducted the proceeding in a
vexatious way that unnecessarily
disadvantaged the other party to the
proceeding; or
(b) the party refused to take part in or withdrew
25 from mediation or other form of alternative
dispute resolution under this Part.
(3) In this section, "costs" includes fees, charges and
disbursements.
__________________
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Part 11--Other Matters
s. 93
PART 11--OTHER MATTERS
93. Indemnities
(1) A provision in a retail premises lease is void to the
extent that it purports to indemnify, or require the
5 tenant to indemnify, the landlord against any
action, liability, penalty, claim or demand for or to
which the landlord would otherwise be liable or
subject.
(2) A provision in a retail premises lease is void to the
10 extent that it purports to make the tenant liable for
or subject to any action, liability, penalty, claim or
demand in respect of any act, matter or thing done
or omitted to be done by the landlord or any other
person if the tenant would not otherwise be liable
15 for or subject to that action, liability, penalty,
claim or demand.
(3) The landlord must indemnify the tenant for any
amount recoverable from the tenant by a public
statutory authority for charges, rates or taxes
20 payable under any Act for the retail premises.
(4) Sub-section (3) does not apply to--
(a) charges for the supply of water by measure
in excess of the minimum amount payable
for it relating to a period during which the
25 tenant occupied the retail premises; or
(b) charges, rates or taxes for which, under the
terms of the retail premises lease, the tenant
is liable.
94. The Act prevails over retail premises leases,
30 agreements etc.
(1) A provision of a retail premises lease or of an
agreement (whether or not the agreement is
between parties to a retail premises lease) is void
to the extent that it is contrary to or inconsistent
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with anything in this Act (including anything that
the lease is taken to include or provide because of
a provision of this Act).
(2) A provision of a retail premises lease or of an
5 agreement (whether or not the agreement is
between parties to a retail premises lease) is void
to the extent that it purports--
(a) to exclude the application of a provision of
this Act; or
10 (b) to limit the right of a party to the lease to
seek resolution of a retail tenancy dispute
under Part 10 or otherwise to limit the
application of that Part.
(3) A provision contained in any other agreement or
15 arrangement (whether or not between parties to a
retail premises lease) is void if that provision
would be void under this Act if it were contained
in a retail premises lease.
95. Occupation of residential area under a retail premises
20 lease
If--
(a) a retail premises lease confers a right on the
tenant to occupy a residential area in the
building in which the retail premises are
25 located; and
(b) the Residential Tenancies Act 1997 does
not apply to the lease to the extent that it
provides for the occupation of the residential
area--
30 the retail premises lease is taken to provide that
the landlord must ensure that the residential area
is maintained in good repair.
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96. Franchise arrangements
(1) This section applies if a person proposes to grant a
licence to another person to use all or part of any
retail premises wholly or predominantly for the
5 carrying on of a business under a name or mark
identifying, commonly associated with or
controlled by the tenant or a person or corporation
(as defined in section 57A of the Corporations
Act) connected with the tenant.
10 (2) The proposed licensor must give the proposed
licensee, within 7 days before the grant of the
licence--
(a) a copy of any disclosure statement given to
the tenant concerning the lease; and
15 (b) details of any changes of which the proposed
licensor is aware, or could reasonably be
expected to be aware, that have affected the
information in the disclosure statement since
it was given to the tenant.
20 Penalty: 10 penalty units.
97. Service of documents
A document under this Act may be served on, or
given to, a person in or out of Victoria--
(a) by delivering it personally to the person; or
25 (b) by leaving it at the person's usual or last
known place of residence or business with
someone who is apparently--
(i) over the age of 16 years; and
(ii) residing at that place or, in the case of a
30 place of business, in charge of or
employed at that place; or
(c) by sending it by post addressed to the person
at the person's usual or last known place of
residence or business; or
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(d) in any other way authorised by the retail
premises lease concerned or by or under any
other Act.
98. Limitation of Supreme Court jurisdiction
5 It is the intention of section 89(4) to alter or vary
section 85 of the Constitution Act 1975.
99. Regulations
(1) The Governor in Council may make regulations
for or with respect to--
10 (a) the form of the disclosure statements referred
to in sections 17, 26 and 61, in particular the
information that the disclosure statement
must contain and any material that must
accompany it; and
15 (b) establishing codes of conduct with which
landlords or tenants under retail premises
leases, or parties to a lease or licence of
premises that under the terms of the lease or
licence are used, or are to be used, wholly or
20 predominantly for a purpose referred to in
paragraph (a) or (b) of section 4(1), must
comply (including concerning casual leasing
arrangements in retail shopping centres); and
(c) matters of a transitional nature (including
25 matters of an application or savings nature)
arising as a result of the enactment of this
Act (including the repeals and amendments
made by this Act); and
(d) any other matter or thing required or
30 permitted by this Act to be prescribed or
necessary to be prescribed to give effect to
this Act.
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(2) A code of conduct may apply, adopt or
incorporate, wholly or partially or as amended in
the code of conduct, the provisions of any
document issued or published by any body
5 whether--
(a) as issued or published before or when the
code of conduct is made; or
(b) as amended from time to time.
(3) A power conferred by this Act to make
10 regulations may be exercised--
(a) either in relation to all cases to which the
power extends, or in relation to all those
cases subject to specified exceptions, or in
relation to any specified case or class of
15 case; and
(b) so as to make, as respects the cases in
relation to which the power is exercised--
(i) the same provision for all cases in
relation to which the power is
20 exercised, or different provisions for
different cases or classes of case, or
different provisions for the same case
or class of case for different purposes;
or
25 (ii) any such provision either
unconditionally or subject to any
specified condition.
__________________
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Part 12--Amendment of Retail Tenancies Reform Act 1998
s. 100
PART 12--AMENDMENT OF RETAIL TENANCIES REFORM
ACT 1998
100. Definitions
See:
(1) In section 3(1) of the Retail Tenancies Reform Act No.
5 Act 1998, insert the following definitions-- 14/1998.
Reprint No. 1
' "outgoings" has the same meaning as in the as at
1 July 1998
Retail Leases Act 2003; and
amending
"prospective tenant", in relation to a lease Act Nos
entered into under an option provided under 52/1998,
85/1998,
10 a retail premises lease to which the Retail 73/2000,
Tenancies Act 1986 applied (a 1986 lease), 27/2001,
44/2001 and
includes a tenant under the 1986 lease; 63/2001.
LawToday:
"Small Business Commissioner" has the same www.dms.
dpc.vic.
meaning as in the Retail Leases Act 2003;
gov.au
15 "specialist retail valuer" has the same meaning
as in the Retail Leases Act 2003;'.
(2) After section 3(7) of the Retail Tenancies
Reform Act 1998 insert--
'(8) The definition of "prospective tenant"
20 inserted in sub-section (1) by section 100(1)
of the Retail Leases Act 2003 only has
effect from 1 November 2003.'.
101. Application
After section 4(2) of the Retail Tenancies
25 Reform Act 1998 insert--
"(3) For the purposes of this Act, on and after
1 November 2003 an assignment of a retail
premises lease is taken to be a continuation
of that lease (and not the entering into of a
30 new lease).
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(4) If in this Act (as amended by Part 12 of the
Retail Leases Act 2003) it is provided that a
provision, or an amendment made to a
provision, only has effect from 1 November
5 2003, the intention of the Parliament is--
(a) that the provision, or the provision as
amended, takes effect from the
beginning of that date for the purposes
of the continued application of this Act
10 as provided by section 119 of that Act
and for no other purpose; and
(b) any provision of this Act amended or
repealed by Part 12 of the Retail
Leases Act 2003 continues (as in force
15 immediately before 1 May 2003) to
have effect until 1 November 2003 for
the purposes of the continued
application of this Act as provided by
section 119 of that Act.".
20 102. Rent review
For section 12(5), (6), (7) and (8) of the Retail
Tenancies Reform Act 1998 substitute--
"(6) If a provision in a retail premises lease that
provides for a review of the rent payable
25 under the lease or a renewal of the lease does
not comply with sub-section (2), the rent is
to be--
(a) as agreed between the landlord and
tenant; or
30 (b) if there is no agreement within 30 days
after the landlord gives the tenant, or
the tenant gives the landlord, a written
notice specifying an amount of rent for
the purposes of the review, the amount
35 determined by a specialist retail valuer
appointed by the Small Business
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Commissioner as the current market
rent of the retail premises (as described
in section 12A(2)).
(7) The landlord and tenant are to pay the costs
5 of a valuation referred to in sub-section
(6)(b) in equal shares.
(8) The amendments made to this section by
section 102 of the Retail Leases Act 2003
only have effect from 1 November 2003.".
10 103. New sections 12A to 13A substituted
For section 13 of the Retail Tenancies Reform
Act 1998 substitute--
'12A. Rent reviews based on current market rent
(1) A retail premises lease that provides for a
15 rent review to be made on the basis of the
current market rent of the premises is taken
to provide as set out in sub-sections (2)
to (6).
(2) The current market rent is taken to be the
20 rent obtainable at the time of the review in a
free and open market between a willing
landlord and willing tenant in an arm's length
transaction having regard to these matters--
(a) the provisions of the lease;
25 (b) the rent that would reasonably be
expected to be paid for the premises if
they were unoccupied and offered for
lease for the same, or a substantially
similar, use to which the premises may
30 be put under the lease;
(c) the landlord's outgoings to the extent to
which the tenant is liable to contribute
to those outgoings;
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(d) rent concessions and other benefits
offered to prospective tenants of
unoccupied retail premises--
but the current market rent is not to take into
5 account the value of goodwill created by the
tenant's occupation or the value of the
tenant's fixtures and fittings.
(3) If the landlord and tenant do not agree on
what the amount of that rent is to be, it is to
10 be determined by a valuation carried out by a
specialist retail valuer appointed by--
(a) agreement between the landlord and
tenant; or
(b) if there is no agreement, the Small
15 Business Commissioner--
and the landlord and tenant are to pay the
costs of the valuation in equal shares.
(4) The landlord must, within 14 days after a
request by the specialist retail valuer, supply
20 the valuer with relevant information about
leases for retail premises located in the same
building or retail shopping centre to assist
the valuer to determine the current market
rent.
25 Penalty: 50 penalty units.
(5) In determining the amount of the rent, the
specialist retail valuer must take into account
the matters set out in sub-section (2).
(6) The valuation must--
30 (a) be in writing; and
(b) contain detailed reasons for the
specialist retail valuer's determination;
and
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(c) specify the matters to which the valuer
had regard in making the determination.
(7) The specialist retail valuer--
(a) must carry out the valuation within
5 45 days after accepting the
appointment; and
(b) may apply to the Tribunal under Part 10
of the Retail Leases Act 2003 for an
order that a landlord comply with a
10 request under sub-section (4).
(8) This section only has effect from
1 November 2003.
12B. Confidentiality of information supplied to
valuer
15 (1) A specialist retail valuer who is supplied
with information by a landlord or tenant for
the purpose of determining under
section 12A the current market rent for a
retail premises lease must not--
20 (a) use or permit the use of the information
for any purpose other than to determine
the current market rent for the lease
concerned; or
(b) communicate or divulge that
25 information to any other person or
permit that information to be
communicated or divulged to any other
person.
Penalty: 50 penalty units.
30 (2) However, sub-section (1) does not prevent
the specialist retail valuer--
(a) communicating or divulging the
information to a court, the Tribunal or
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the Small Business Commissioner, or
permitting another person to do so; or
(b) using, communicating or divulging the
information or permitting another
5 person to do so--
(i) in accordance with the consent of
both the landlord and tenant; or
(ii) in a way that does not disclose
information identifying a
10 particular lease or tenant, or
relating to a tenant's business, for
the purpose of specifying the
matters to which the valuer had
regard in making the
15 determination concerned.
(3) A specialist retail valuer who contravenes
this section is liable to pay to the landlord or
tenant concerned compensation for any loss
or damage suffered by the landlord or tenant
20 as a result of the information being used,
communicated or divulged.
(4) The amount of the compensation is the
amount that is--
(a) agreed between the valuer and the
25 person seeking compensation; or
(b) if there is no agreement, determined
under Part 10 of the Retail Leases Act
2003.
(5) This section only has effect from
30 1 November 2003.
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13. Rent based on turnover
(1) A provision in a retail premises lease that the
rent is to be determined either fully or partly
by reference to the turnover of the business
5 is void unless the lease specifies how the rent
is to be determined.
Note: If the provision is void, see section 13A.
(2) If a retail premises lease specifies how the
rent is to be determined fully or partly by
10 reference to the turnover of the business, the
tenant must give the landlord--
(a) within 14 days after the end of each
month for which the rent is to be
determined in that way or such longer
15 period as the lease provides, a
statement in writing giving the turnover
during that month or other period to
which the statement relates; and
(b) within 28 days after the end of each
20 year for which the rent is to be
determined in that way or such longer
period as the lease provides and at the
end of the lease or on an assignment of
the lease--
25 (i) a statement of the turnover; and
(ii) an audit report from an
independent accountant stating
that in his or her opinion the
statement fairly presents the
30 turnover of the business during
that year or other period to which
the statement relates.
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(3) A tenant who gives the landlord statements
for a period in accordance with sub-section
(2) satisfies any obligation under the lease to
provide turnover figures or statements for
5 that period.
(4) For the purposes of sub-sections (2) and (3)
and any provision of a retail premises lease
about the determination of rent by reference
to turnover, "turnover" does not include
10 any of the following--
(a) the net amount of discounts reasonably
and properly allowed to any customer
in the usual course of business;
(b) the amount of losses incurred in the
15 resale or disposal of goods reasonably
and properly purchased from customers
as trade-ins in the usual course of
business;
(c) the amount of uncollected credit
20 accounts written off by the tenant
(except to the extent that amounts of a
credit account previously written off by
the tenant are recovered);
(d) the amount of any cash or credit refund
25 allowed on a transaction the proceeds
of which have previously been included
as turnover, if the merchandise is
returned and the sale is cancelled or
some or all of the fees for the services
30 are refunded;
(e) the amount of any instalment of
purchase money refunded to customers
where a lay-by transaction is cancelled;
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(f) the amount of any purchase, receipt or
other similar tax (including GST)
imposed on the purchase price or cost
of hire of merchandise or services at the
5 point of sale or hire;
(g) the amount of delivery charges;
(h) the price of merchandise exchanged
between stores of the tenant made
solely for the convenient operation of
10 business and not for the purpose of
concluding a sale made at or from the
retail premises to which the lease
relates;
(i) the price of merchandise returned to
15 shippers, wholesalers or manufacturers;
(j) the amount received from the sale of
the fixtures and fittings of the tenant
from the premises;
(k) money received for entries in any
20 public lottery within the meaning of the
Public Lotteries Act 2000, other than
amounts derived as commission or fees
on those entries;
(l) any other matter which the landlord and
25 the tenant agree is not included as
turnover.
(5) This section only has effect from
1 November 2003.
13A. Agreement about rent based on turnover
30 (1) If--
(a) a provision of a retail premises lease
that the rent is to be determined either
fully or partly by reference to the
turnover of the business is void because
35 of section 13; and
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(b) the lease makes no other provision for
determining the rent--
the rent is to be as agreed in writing between
the landlord and tenant.
5 (2) If the landlord and tenant do not agree on an
amount of rent within 30 days of the landlord
giving the tenant a written notice specifying
an amount, the amount of the rent is to be
determined by a valuation carried out by a
10 specialist retail valuer appointed by--
(a) agreement between the landlord and
tenant; or
(b) if there is no agreement, the Small
Business Commissioner--
15 and the landlord and tenant are to pay the
costs of the valuation in equal shares.
(3) This section only has effect from
1 November 2003.'.
104. New section 16 substituted
20 For section 16 of the Retail Tenancies Reform
Act 1998 substitute--
"16. Notice of the landlord's intentions
concerning renewal
(1) This section applies if the tenant under a
25 retail premises lease does not have an option
under the lease to renew the lease for a
further term.
(2) The landlord must, at least 6 months but no
more than 12 months before the lease term
30 ends, give written notice to the tenant--
(a) offering the tenant a renewal of the
lease on the terms specified in the
notice (including a term setting out the
rent); or
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(b) informing the tenant that the landlord
does not propose to offer the tenant a
renewal of the lease.
(3) An offer to renew the lease cannot be
5 revoked without the tenant's consent for
60 days after it is made.
(4) If the landlord fails to comply with sub-
section (2)--
(a) the landlord must give the tenant a
10 notice containing the same information
as the notice the landlord was required
to give under sub-section (2); and
(b) the lease continues (on the same terms
and conditions as applied immediately
15 before the lease term ends) until--
(i) the day specified in the notice that
the landlord is required to give
under paragraph (a) (which must
be at least 6 months after the
20 notice is given to the tenant); or
(ii) if the tenant gives the landlord a
notice under sub-section (5), the
day specified in that notice.
(5) If the landlord fails to comply with sub-
25 section (2), the tenant may, at any time
before the landlord gives the tenant a notice
under sub-section (4)(a), give written notice
to the landlord terminating the lease from a
day that is not earlier than the day on which
30 the term of the lease expires.
(6) This section only has effect from
1 November 2003.".
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105. Options to renew
For section 18(3), (4), (5), (6) and (7) of the
Retail Tenancies Reform Act 1998 substitute--
"(3) If a retail premises lease contains an option
5 exercisable by the tenant to renew the lease
for a further term, the landlord must notify
the tenant in writing of the date after which
the option is no longer exercisable--
(a) at least 6 months; and
10 (b) no more than 12 months--
before that date but is not required to do so if
the tenant exercises, or purports to exercise,
the option before being notified of the date.
(4) If sub-section (3) requires the landlord to
15 notify the tenant but the landlord fails to do
so within the time specified by that sub-
section--
(a) the retail premises lease is taken to
provide that the date after which the
20 option is no longer exercisable is
instead 6 months after the landlord
notifies the tenant as required; and
(b) if that date is after the term of the lease
ends, the lease continues until that date
25 (on the same terms and conditions as
applied immediately before the lease
term ends); and
(c) at any time before the landlord notifies
the tenant as required, the tenant may
30 give written notice to the landlord
terminating the lease from a specified
day that is--
(i) on or after the date on which the
term of the lease ends; and
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(ii) before the date until which the
lease would otherwise have
continued because of
paragraph (b).
5 (5) If the tenant gives the landlord a notice of
termination under sub-section (4)(c), the
lease terminates on the day specified in the
notice.
(6) If an option to renew is exercised because of
10 sub-section (4)(b) after the term of the lease
ends, the lease for the further term
commences on the expiry of the previous
lease, disregarding for this purpose any
period during which that lease continued
15 because of that sub-section.
(7) The amendments made to this section by
section 105 of the Retail Leases Act 2003
only have effect from 1 November 2003.".
106. New sections 20 to 21A substituted
20 For sections 20 and 21 of the Retail Tenancies
Reform Act 1998 substitute--
"20. Liability to contribute to non-specific
outgoings
(1) A tenant under a retail premises lease where
25 the retail premises are located in a retail
shopping centre is only liable to contribute
towards an outgoing of the landlord that
benefits specific retail premises in the centre
if the retail premises are one of the premises
30 that benefit from the outgoing.
(2) A tenant is not liable to contribute towards
an outgoing of the landlord in accordance
with sub-section (1) in excess of an amount
calculated as prescribed by the regulations
35 made for the purposes of section 39(2) of the
Retail Leases Act 2003.
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(3) This section only has effect from
1 November 2003.
20A. Estimate of outgoings
(1) A retail premises lease is taken to provide as
5 set out in this section.
(2) The landlord must give the tenant a written
estimate of the outgoings to which the tenant
is liable to contribute under the lease that
itemises those outgoings.
10 (3) The tenant must be given the estimate of
outgoings--
(a) before the lease is entered into; and
(b) in respect of each of the landlord's
accounting periods during the term of
15 the lease, at least one month before the
start of that period.
(4) The tenant is not liable to contribute to any
outgoings of which an estimate is required to
be given to the tenant as set out in this
20 section until the tenant is given that estimate.
(5) This section only has effect from
1 November 2003.
21. Statement of outgoings
(1) A retail premises lease is taken to provide as
25 set out in this section.
(2) The landlord must prepare a written
statement that details all expenditure by the
landlord, in each of the landlord's accounting
periods during the term of the lease, on
30 account of outgoings to which the tenant is
liable to contribute.
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(3) The landlord must--
(a) make the statement available to the
tenant at least once in relation to
expenditure during each of the
5 landlord's accounting periods during the
term of the lease; and
(b) give the tenant the statement within
3 months after the end of the
accounting period to which it relates.
10 (4) The outgoings statement may relate to more
than one tenant as long as each tenant to
which it relates can ascertain from the
statement the details relevant to the tenant.
(5) The outgoings statement must be--
15 (a) prepared in accordance with relevant
principles and disclosure requirements
of applicable accounting standards (in
force from time to time) made by the
Australian Accounting Standards
20 Board; and
(b) in the case of a statement given under
sub-section (3)(b), accompanied by a
report prepared by a registered
company auditor (within the meaning
25 of the Corporations Act) that states
whether--
(i) the statement correctly states the
landlord's expenditure during the
accounting period in respect of the
30 total amount of outgoings, and
each individual outgoing that
comprises more than the
percentage of the total amount of
outgoings prescribed for the
35 purposes of section 47(5)(b)(i) of
the Retail Leases Act 2003, to
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which the tenant is liable to
contribute; and
(ii) the total amount of estimated
outgoings for that period (as
5 shown in the estimate of
outgoings given to the tenant)
exceeded the total actual
expenditure by the landlord in
respect of those outgoings during
10 that period.
(6) However, the outgoings statement given
under sub-section (3)(b) need not be
accompanied by an auditor's report if it--
(a) does not relate to any outgoings other
15 than--
(i) GST; and
(ii) land tax and water, sewerage and
drainage rates and charges; and
(iii) municipal council rates and
20 charges; and
(iv) insurance; and
(v) any other outgoing of a kind
prescribed by the regulations
made for the purposes of section
25 47(6)(a)(v) of the Retail Leases
Act 2003; and
(b) is accompanied by copies of
assessments, invoices, receipts or other
proof of payment for all expenditure by
30 the landlord included in the statement.
(7) An auditor preparing a report under sub-
section (5)(b) must ensure that the tenant is
given a reasonable opportunity to make a
written submission to the auditor on the
35 accuracy of the outgoings statement.
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(8) This section only has effect from
1 November 2003.
21A. Adjustment of contributions to outgoings
(1) A retail premises lease is taken to provide as
5 set out in this section.
(2) There is to be an adjustment between the
landlord and tenant for each of the landlord's
accounting periods during the term of the
lease to take account of any underpayment or
10 overpayment by the tenant in respect of
outgoings during that period.
(3) The adjustment is to take place--
(a) within one month after the landlord
gives the tenant the outgoings statement
15 under section 21 for the period; or
(b) within 4 months after the end of the
period--
whichever is earlier.
(4) The adjustment is to be calculated on the
20 basis of the difference between--
(a) the total amount of outgoings in respect
of which the tenant contributed (that is,
the estimated total expenditure by the
landlord on outgoings during the
25 period); and
(b) the total actual expenditure by the
landlord in respect of those outgoings
during the period, but taking into
account only expenditure properly and
30 reasonably incurred by the landlord in
the payment of those outgoings.
(5) This section only has effect from
1 November 2003.".
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107. New sections 24 and 25 substituted
For sections 24 and 25 of the Retail Tenancies
Reform Act 1998 substitute--
"24. Landlord to give notice of alterations and
5 refurbishments
(1) A retail premises lease is taken to provide
that the landlord must not start to carry out
any alteration or refurbishment of the
building or retail shopping centre in which
10 the retail premises are located which is likely
to affect adversely the business of the tenant
unless--
(a) the landlord has notified the tenant in
writing of the proposed alteration or
15 refurbishment at least 60 days before it
is started; or
(b) the alteration or refurbishment is
necessary because of an emergency and
the landlord has given the tenant the
20 maximum period of notice that is
reasonably practicable in the
circumstances.
(2) This section only has effect from
1 November 2003.
25 25. Landlord's liability for repairs
(1) A retail premises lease is taken to provide as
set out in this section.
(2) The landlord is responsible for maintaining
in good repair--
30 (a) the structure of, or fixtures in, the retail
premises; and
(b) plant or equipment at the retail
premises; and
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(c) the appliances, fittings or fixtures
provided under the lease by the
landlord relating to the gas, electricity,
water, drainage or other services.
5 (3) However, the landlord is not responsible for
maintaining those things in good repair if--
(a) the need for the repair arises out of
misuse by the tenant; or
(b) the tenant is entitled or required to
10 remove the thing at the end of the lease.
(4) The tenant may arrange for urgent repairs
(for which the landlord is responsible) to be
carried out to those things if--
(a) the repairs are necessary to fix or
15 remedy a fault or damage that has or
causes a substantial effect on or to the
tenant's business at the premises; and
(b) the tenant is unable to get the landlord
or the landlord's agent to carry out the
20 repairs despite having taken reasonable
steps to arrange for the landlord or
agent to do so.
(5) If the tenant carries out those repairs--
(a) the tenant must give the landlord
25 written notice of the repairs and the
cost within 14 days after the repairs are
carried out; and
(b) the landlord is liable to reimburse the
tenant for the reasonable cost of the
30 repairs.
(6) This section only has effect from
1 November 2003.".
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108. New section 30 substituted
For section 30 of the Retail Tenancies Reform
Act 1998 substitute--
"30. Relocation of the tenant's business
5 (1) A retail premises lease that provides for--
(a) relocation of the tenant's business; or
(b) termination of the lease and offer of a
new lease of alternative retail
premises--
10 is taken to provide as set out in this section.
(2) The landlord cannot require the tenant's
business to be relocated or terminate the
lease and offer a new lease of alternative
retail premises unless the landlord has
15 provided the tenant with details of a
proposed refurbishment, redevelopment or
extension that are sufficient to indicate a
genuine proposal that--
(a) is to be carried out within a reasonably
20 practicable time after the relocation;
and
(b) cannot be carried out practicably
without vacant possession of the retail
premises.
25 (3) The landlord cannot require the tenant's
business to be relocated or terminate the
lease and offer a new lease of alternative
retail premises unless the landlord has given
the tenant at least 3 months' written notice of
30 the relocation with details of alternative
comparable retail premises to be made
available to the tenant.
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(4) The tenant is entitled to be offered a new
lease of the alternative retail premises on the
same terms and conditions as the existing
lease except that--
5 (a) the term of the new lease is to be the
same as the remaining term of the
existing lease; and
(b) the rent for the alternative retail
premises is to be the same as the rent
10 for the existing retail premises, adjusted
to take into account the difference in
the commercial values of the premises
at the time of relocation.
(5) The tenant is entitled to payment by the
15 landlord of the tenant's reasonable costs of
the relocation, including (but not limited to)
the costs of dismantling and reinstalling or
modifying or replacing any fixtures and
fittings and legal costs that are agreed
20 between the landlord and tenant or, if there is
no agreement, determined under Part 10 of
the Retail Leases Act 2003.
(6) This section only has effect from
1 November 2003.
25 Note 1: This section sets out what the tenant is entitled
to but does not prevent the tenant from
accepting other arrangements when the details
of a relocation are being negotiated.
Note 2: A landlord may give a notice under section
30 30(3) at any time after the passing of the
Retail Leases Act 2003 if the tenant's business
is to be relocated on or after 1 November 2003:
see Interpretation of Legislation Act 1984
section 13.".
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109. Minor amendments
(1) In section 8(5)(b) of the Retail Tenancies
Reform Act 1998, for "or false" substitute
", false or materially incomplete".
5 (2) After section 8(12) of the Retail Tenancies
Reform Act 1998 insert--
"(13) The amendment made to this section by
section 109(1) of the Retail Leases Act 2003
only has effect from 1 November 2003.".
10 (3) In section 34(1) of the Retail Tenancies Reform
Act 1998, for "13" substitute "13A".
(4) After section 34(2) of the Retail Tenancies
Reform Act 1998 insert--
"(3) The amendment made to this section by
15 section 109(3) of the Retail Leases Act 2003
only has effect from 1 November 2003.".
(5) In section 52(1) of the Retail Tenancies Reform
Act 1998, after "that Act" (where first occurring)
insert "(and from 1 November 2003, that Act as
20 amended by Part 13 of the Retail Leases Act
2003)".
__________________
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PART 13--AMENDMENT OF RETAIL TENANCIES ACT 1986
110. Definitions
See:
In section 3(1) of the Retail Tenancies Act 1986, Act No.
insert the following definitions-- 106/1986.
Reprint No. 3
5 ' "outgoings" has the same meaning as in the as at
14 July 1997.
Retail Leases Act 2003; LawToday:
www.dms.
"Small Business Commissioner" has the same dpc.vic.
meaning as in the Retail Leases Act 2003; gov.au
"specialist retail valuer" has the same meaning
10 as in the Retail Leases Act 2003;'.
111. Application
After section 4(4) of the Retail Tenancies Act
1986 insert--
"(5) For the purposes of this Act, on and after
15 1 November 2003 an assignment of a retail
premises lease is taken to be a continuation
of that lease (and not the entering into of a
new lease).
(6) If in this Act (as amended by Part 13 of the
20 Retail Leases Act 2003) it is provided that a
provision, or an amendment made to a
provision, only has effect from 1 November
2003, the intention of the Parliament is--
(a) that the provision, or the provision as
25 amended, takes effect from the
beginning of that date for the purposes
of the continued application of this Act
as provided by section 52 of the Retail
Tenancies Reform Act 1998 and for
30 no other purpose; and
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(b) any provision of this Act amended or
repealed by Part 13 of the Retail
Leases Act 2003 continues (as in force
immediately before 1 July 1998) to
5 have effect until 1 November 2003 for
the purposes of the continued
application of this Act as provided by
section 52 of the Retail Tenancies
Reform Act 1998.".
10 112. Rent review
For section 10(4), (5), (6) and (7) of the Retail
Tenancies Act 1986 substitute--
"(4) If a provision in a retail premises lease that
provides for a review of the rent does not
15 comply with sub-section (1), the rent is to
be--
(a) as agreed between the landlord and
tenant; or
(b) if there is no agreement within 30 days
20 after the landlord gives the tenant, or
the tenant gives the landlord, a written
notice specifying an amount of rent for
the purposes of the review, the amount
determined by a specialist retail valuer
25 appointed by the Small Business
Commissioner as the current market
rent of the retail premises (as described
in section 11(2)).
(5) The landlord and tenant are to pay the costs
30 of a valuation referred to in sub-section
(4)(b) in equal shares.
(6) The amendments made to this section by
section 112 of the Retail Leases Act 2003
only have effect from 1 November 2003.".
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113. New sections 11 and 11A substituted
For section 11 of the Retail Tenancies Act 1986
substitute--
'11. Rent based on turnover
5 (1) A provision in a retail premises lease that the
rent is to be determined either fully or partly
by reference to the turnover of the business
is void unless the lease specifies how the rent
is to be determined.
10 Note: If the provision is void, see section 11A.
(2) If a retail premises lease specifies how the
rent is to be determined fully or partly by
reference to the turnover of the business, the
tenant must give the landlord--
15 (a) within 14 days after the end of each
month for which the rent is to be
determined in that way or such longer
period as the lease provides, a
statement in writing giving the turnover
20 during that month or other period to
which the statement relates; and
(b) within 28 days after the end of each
year for which the rent is to be
determined in that way or such longer
25 period as the lease provides and at the
end of the lease or on an assignment of
the lease--
(i) a statement of the turnover; and
(ii) an audit report from an
30 independent accountant stating
that in his or her opinion the
statement fairly presents the
turnover of the business during
that year or other period to which
35 the statement relates.
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(3) A tenant who gives the landlord statements
for a period in accordance with sub-section
(2) satisfies any obligation under the lease to
provide turnover figures or statements for
5 that period.
(4) For the purposes of sub-sections (2) and (3)
and any provision of a retail premises lease
about the determination of rent by reference
to turnover, "turnover" does not include
10 any of the following--
(a) the net amount of discounts reasonably
and properly allowed to any customer
in the usual course of business;
(b) the amount of losses incurred in the
15 resale or disposal of goods reasonably
and properly purchased from customers
as trade-ins in the usual course of
business;
(c) the amount of uncollected credit
20 accounts written off by the tenant
(except to the extent that amounts of a
credit account previously written off by
the tenant are recovered);
(d) the amount of any cash or credit refund
25 allowed on a transaction the proceeds
of which have previously been included
as turnover, if the merchandise is
returned and the sale is cancelled or
some or all of the fees for the services
30 are refunded;
(e) the amount of any instalment of
purchase money refunded to customers
where a lay-by transaction is cancelled;
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(f) the amount of any purchase, receipt or
other similar tax (including GST)
imposed on the purchase price or cost
of hire of merchandise or services at the
5 point of sale or hire;
(g) the amount of delivery charges;
(h) the price of merchandise exchanged
between stores of the tenant made
solely for the convenient operation of
10 business and not for the purpose of
concluding a sale made at or from the
retail premises to which the lease
relates;
(i) the price of merchandise returned to
15 shippers, wholesalers or manufacturers;
(j) the amount received from the sale of
the fixtures and fittings of the tenant
from the premises;
(k) money received for entries in any
20 public lottery within the meaning of the
Public Lotteries Act 2000, other than
amounts derived as commission or fees
on those entries;
(l) any other matter which the landlord and
25 the tenant agree is not included as
turnover.
(5) This section only has effect from
1 November 2003.
11A. Agreement about rent based on turnover
30 (1) If--
(a) a provision of a retail premises lease
that the rent is to be determined either
fully or partly by reference to the
turnover of the business is void because
35 of section 11; and
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(b) the lease makes no other provision for
determining the rent--
the rent is to be as agreed in writing between
the landlord and tenant.
5 (2) If the landlord and tenant do not agree on an
amount of rent within 30 days of the landlord
giving the tenant a written notice specifying
an amount, the amount of the rent is to be
determined by a valuation carried out by a
10 specialist retail valuer appointed by--
(a) agreement between the landlord and
tenant; or
(b) if there is no agreement, the Small
Business Commissioner--
15 and the landlord and tenant are to pay the
costs of the valuation in equal shares.
(3) This section only has effect from
1 November 2003.'.
114. Options to renew
20 For section 14(3), (4), (5), (6), (7), (8) and (9) of
the Retail Tenancies Act 1986 substitute--
"(3) If a retail premises lease contains an option
exercisable by the tenant to renew the lease
for a further term, the landlord must notify
25 the tenant in writing of the date after which
the option is no longer exercisable--
(a) at least 6 months; and
(b) no more than 12 months--
before that date but is not required to do so if
30 the tenant exercises, or purports to exercise,
the option before being notified of the date.
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(4) If sub-section (3) requires the landlord to
notify the tenant but the landlord fails to do
so within the time specified by that sub-
section--
5 (a) the retail premises lease is taken to
provide that the date after which the
option is no longer exercisable is
instead 6 months after the landlord
notifies the tenant as required; and
10 (b) if that date is after the term of the lease
ends, the lease continues until that date
(on the same terms and conditions as
applied immediately before the lease
term ends); and
15 (c) at any time before the landlord notifies
the tenant as required, the tenant may
give written notice to the landlord
terminating the lease from a specified
day that is--
20 (i) on or after the date on which the
term of the lease ends; and
(ii) before the date until which the
lease would otherwise have
continued because of
25 paragraph (b).
(5) If the tenant gives the landlord a notice of
termination under sub-section (4)(c), the
lease terminates on the day specified in the
notice.
30 (6) If an option to renew is exercised because of
sub-section (4)(b) after the term of the lease
ends, the lease for the further term
commences on the expiry of the previous
lease, disregarding for this purpose any
35 period during which that lease continued
because of that sub-section.
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(7) The amendments made to this section by
section 114 of the Retail Leases Act 2003
only have effect from 1 November 2003.".
115. New sections 14A to 15A substituted
5 For section 15 of the Retail Tenancies Act 1986
substitute--
"14A. Estimate of outgoings
(1) A retail premises lease is taken to provide as
set out in this section.
10 (2) The landlord must give the tenant a written
estimate of the outgoings to which the tenant
is liable to contribute under the lease that
itemises those outgoings.
(3) The tenant must be given the estimate of
15 outgoings--
(a) before the lease is entered into; and
(b) in respect of each of the landlord's
accounting periods during the term of
the lease, at least one month before the
20 start of that period.
(4) The tenant is not liable to contribute to any
outgoings of which an estimate is required to
be given to the tenant as set out in this
section until the tenant is given that estimate.
25 (5) This section only has effect from
1 November 2003.
15. Statement of outgoings
(1) A retail premises lease is taken to provide as
set out in this section.
30 (2) The landlord must prepare a written
statement that details all expenditure by the
landlord, in each of the landlord's accounting
periods during the term of the lease, on
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account of outgoings to which the tenant is
liable to contribute.
(3) The landlord must--
(a) make the statement available to the
5 tenant at least once in relation to
expenditure during each of the
landlord's accounting periods during the
term of the lease; and
(b) give the tenant the statement within 3
10 months after the end of the accounting
period to which it relates.
(4) The outgoings statement may relate to more
than one tenant as long as each tenant to
which it relates can ascertain from the
15 statement the details relevant to the tenant.
(5) The outgoings statement must be--
(a) prepared in accordance with relevant
principles and disclosure requirements
of applicable accounting standards (in
20 force from time to time) made by the
Australian Accounting Standards
Board; and
(b) in the case of a statement given under
sub-section (3)(b), accompanied by a
25 report prepared by a registered
company auditor (within the meaning
of the Corporations Act) that states
whether--
(i) the statement correctly states the
30 landlord's expenditure during the
accounting period in respect of the
total amount of outgoings, and
each individual outgoing that
comprises more than the
35 percentage of the total amount of
outgoings prescribed for the
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purposes of section 47(5)(b)(i) of
the Retail Leases Act 2003, to
which the tenant is liable to
contribute; and
5 (ii) the total amount of estimated
outgoings for that period (as
shown in the estimate of
outgoings given to the tenant)
exceeded the total actual
10 expenditure by the landlord in
respect of those outgoings during
that period.
(6) However, the outgoings statement given
under sub-section (3)(b) need not be
15 accompanied by an auditor's report if it--
(a) does not relate to any outgoings other
than--
(i) GST; and
(ii) land tax and water, sewerage and
20 drainage rates and charges; and
(iii) municipal council rates and
charges; and
(iv) insurance; and
(v) any other outgoing of a kind
25 prescribed by the regulations
made for the purposes of section
47(6)(a)(v) of the Retail Leases
Act 2003; and
(b) is accompanied by copies of
30 assessments, invoices, receipts or other
proof of payment for all expenditure by
the landlord included in the statement.
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(7) An auditor preparing a report under sub-
section (5)(b) must ensure that the tenant is
given a reasonable opportunity to make a
written submission to the auditor on the
5 accuracy of the outgoings statement.
(8) This section only has effect from
1 November 2003.
15A. Adjustment of contributions to outgoings
(1) A retail premises lease is taken to provide as
10 set out in this section.
(2) There is to be an adjustment between the
landlord and tenant for each of the landlord's
accounting periods during the term of the
lease to take account of any underpayment or
15 overpayment by the tenant in respect of
outgoings during that period.
(3) The adjustment is to take place--
(a) within one month after the landlord
gives the tenant the outgoings statement
20 under section 15 for the period; or
(b) within 4 months after the end of the
period--
whichever is earlier.
(4) The adjustment is to be calculated on the
25 basis of the difference between--
(a) the total amount of outgoings in respect
of which the tenant contributed (that is,
the estimated total expenditure by the
landlord on outgoings during the
30 period); and
(b) the total actual expenditure by the
landlord in respect of those outgoings
during the period, but taking into
account only expenditure properly and
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reasonably incurred by the landlord in
the payment of those outgoings.
(5) This section only has effect from
1 November 2003.".
5 116. New sections 17A and 17B inserted
After section 17 of the Retail Tenancies Act
1986 insert--
"17A. Relocation of the tenant's business
(1) A retail premises lease that provides for--
10 (a) relocation of the tenant's business; or
(b) termination of the lease and offer of a
new lease of alternative retail
premises--
is taken to provide as set out in this section.
15 (2) The landlord cannot require the tenant's
business to be relocated or terminate the
lease and offer a new lease of alternative
retail premises unless the landlord has
provided the tenant with details of a
20 proposed refurbishment, redevelopment or
extension that are sufficient to indicate a
genuine proposal that--
(a) is to be carried out within a reasonably
practicable time after the relocation;
25 and
(b) cannot be carried out practicably
without vacant possession of the retail
premises.
(3) The landlord cannot require the tenant's
30 business to be relocated or terminate the
lease and offer a new lease of alternative
retail premises unless the landlord has given
the tenant at least 3 months' written notice of
the relocation with details of alternative
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comparable retail premises to be made
available to the tenant.
(4) The tenant is entitled to be offered a new
lease of the alternative retail premises on the
5 same terms and conditions as the existing
lease except that--
(a) the term of the new lease is to be the
same as the remaining term of the
existing lease; and
10 (b) the rent for the alternative retail
premises is to be the same as the rent
for the existing retail premises, adjusted
to take into account the difference in
the commercial values of the premises
15 at the time of relocation.
(5) The tenant is entitled to payment by the
landlord of the tenant's reasonable costs of
the relocation, including (but not limited to)
the costs of dismantling and reinstalling or
20 modifying or replacing any fixtures and
fittings and legal costs that are agreed
between the landlord and tenant or, if there is
no agreement, determined under Part 10 of
the Retail Leases Act 2003.
25 (6) This section only has effect from
1 November 2003.
Note 1: This section sets out what the tenant is entitled
to but does not prevent the tenant from
accepting other arrangements when the details
30 of a relocation are being negotiated.
Note 2: A landlord may give a notice under section
17A(3) at any time after the passing of the
Retail Leases Act 2003 if the tenant's business
is to be relocated on or after 1 November 2003:
35 see Interpretation of Legislation Act 1984
section 13.
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17B. Landlord's liability for repairs
(1) A retail premises lease is taken to provide as
set out in this section.
(2) The landlord is responsible for maintaining
5 in good repair--
(a) the structure of, or fixtures in, the retail
premises; and
(b) plant or equipment at the retail
premises; and
10 (c) the appliances, fittings or fixtures
provided under the lease by the
landlord relating to the gas, electricity,
water, drainage or other services.
(3) However, the landlord is not responsible for
15 maintaining those things in good repair if--
(a) the need for the repair arises out of
misuse by the tenant; or
(b) the tenant is entitled or required to
remove the thing at the end of the lease.
20 (4) The tenant may arrange for urgent repairs
(for which the landlord is responsible) to be
carried out to those things if--
(a) the repairs are necessary to fix or
remedy a fault or damage that has or
25 causes a substantial effect on or to the
tenant's business at the premises; and
(b) the tenant is unable to get the landlord
or the landlord's agent to carry out the
repairs despite having taken reasonable
30 steps to arrange for the landlord or
agent to do so.
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(5) If the tenant carries out those repairs--
(a) the tenant must give the landlord
written notice of the repairs and the
cost within 14 days after the repairs are
5 carried out; and
(b) the landlord is liable to reimburse the
tenant for the reasonable cost of the
repairs.
(6) This section only has effect from
10 1 November 2003.".
117. Minor amendments
(1) In section 20(1) of the Retail Tenancies Act
1986, for "11" substitute "11A".
(2) After section 20(2) of the Retail Tenancies Act
15 1986 insert--
"(3) The amendment made to this section by
section 117(1) of the Retail Leases Act 2003
only has effect from 1 November 2003.".
__________________
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Act No.
Part 14--Repeal of 1998 Act and Transitional Provisions
s. 118
PART 14--REPEAL OF 1998 ACT AND TRANSITIONAL
PROVISIONS
118. Repeal of Retail Tenancies Reform Act 1998
The Retail Tenancies Reform Act 1998 is
5 repealed.
119. General transitional and savings
(1) Despite the repeal of the Retail Tenancies
Reform Act 1998 but subject to Part 10 of this
Act, that Act continues to apply, and from
10 1 November 2003 applies as amended by Part 12
of this Act, to a retail premises lease to which it
applied immediately before its repeal.
(2) However, if proceedings under Part 3 of the
Retail Tenancies Reform Act 1998 have been
15 commenced but are not completed before that Act
is repealed, Part 3 of that Act continues to apply to
those proceedings despite that repeal and despite
Part 10 of this Act.
(3) Sections 39 and 52 of the Retail Tenancies
20 Reform Act 1998, as in force immediately before
the repeal of that Act, continue to have effect
despite that repeal.
(4) For the avoidance of doubt it is declared that the
effect of section 4(1) of the Retail Tenancies
25 Reform Act 1998 is, and always has been, to
apply that Act to a retail premises lease within the
meaning of that Act that was entered into on or
after 1 July 1998 including one entered into under
an option provided under such a lease that was
30 entered into before that date.
120. Disclosure statements
A disclosure statement given under section 8 of
the Retail Tenancies Reform Act 1998 that
provides information about each of the matters set
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out in the Schedule to that Act is taken to be, and
to have been at all times, in the form of that
Schedule regardless of whether it has the same
layout as the disclosure statement set out in that
5 Schedule.
121. Notification of amount of land tax
(1) Despite anything to the contrary in this Act,
section 50 of this Act does not apply to--
(a) a lease entered into before the
10 commencement of this section; or
(b) an assignment of such a lease.
(2) If--
(a) section 50 of this Act does not apply to a
lease or an assignment of a lease; and
15 (b) the tenant is liable under the lease to pay an
amount in respect of tax under the Land Tax
Act 1958 for which the landlord is liable;
and
(c) the landlord receives an assessment of that
20 tax on or after the commencement of this
section--
within 21 days of receiving the assessment, the
landlord must give written notice to the tenant of
the amount of the assessment.
25 Penalty: 10 penalty units.
(3) A landlord is not required to give notice to a
tenant under sub-section (2) if an estimate of the
amount of land tax which the tenant is liable to
pay has been given to the tenant as required by
30 section 46.
__________________
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Part 15--Consequential and Other Amendments
s. 122
PART 15--CONSEQUENTIAL AND OTHER AMENDMENTS
122. Shop Trading Reform Act 1996
(1) In section 7(1) and (2) of the Shop Trading
Reform Act 1996, after "Sunday" insert "or a
5 public holiday where the shop is located".
(2) In section 7(3) of the Shop Trading Reform Act
1996--
(a) for "Retail Tenancies Reform Act 1998"
substitute "Retail Leases Act 2003";
10 (b) for "Part 3" substitute "Part 10";
(c) for "dispute arising under the retail premises
lease" substitute "retail tenancy dispute
within the meaning of that Part".
123. Victorian Civil and Administrative Tribunal Act 1998
15 After Part 17 of Schedule 1 to the Victorian Civil
and Administrative Tribunal Act 1998 insert--
"PART 17A--RETAIL LEASES ACT 2003
77B. Any legally qualified member may make a
declaration
20 Despite anything to the contrary in
section 124, a declaration may be made in a
proceeding under the Retail Leases Act
2003 by the Tribunal constituted by a
member who is a legal practitioner.".
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Act No.
Endnotes
ENDNOTES
By Authority. Government Printer for the State of Victoria.
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