If you are considering entering into a Retail shop lease in Queensland, it is important that you obtain professional legal advice to ensure your rights are protected, and that you understand the nature of a retail shop lease and your obligations under the lease.
Retail shop leases in Queensland must comply with minimum standards which are set out in the Retail Shop Leases Act 1994.
The abovementioned legislation attempts to address the imbalance which can sometimes arise between large landlords and small retails tenants in respect of access to information and negotiating power, prescribing low cost dispute resolution processes for disputing parties to follow in the event of a disagreement in respect of the lease or assignment.
It is important for the tenant to be aware that although there are mechanisms in place to help protect them against a power imbalance, they still have an obligation to make necessary enquiries and ensure that they understand the viability of the proposed business and the risks involved in entering the lease.
The Act further describes in detail the disclosure requirements for parties entering into a new lease or assignment.
For example, prior to entry into a new retail lease, a Lessor Disclosure Statement must be provided to the prospective tenants at least seven (7) days prior to the execution of the Lease or the tenant entering into possession of the premises. There are different requirements in relation to an assignment of a lease, which include obligations on the Assignee (present tenant) to provide prospective tenants with a disclosure statement prior to the Lessor becoming involved in the matter.
The Act also obligates the tenant to provide a Lessee Disclosure Statement to the Lessor/Assignee, and in circumstances where the tenant has less than five (5) retail premises, the tenant must also provide the Lessor with a Legal Advice Report and Financial Advice Report.
Failure of the landlord to provide the statement to the prospective tenants within these time periods, can, in extreme situations (and relevant time restrictions); result in termination of the lease and there are also implications for the tenant if they fail to comply with the Act.
If you are considering entering into a new retail shop lease, assignment of a retail shop lease or require assistance with your current lease, please do not hesitate to contact one of our Gold Coast Lawyers for specific legal advice on 07 5630 6888.