Check whether the Retail Leases Act applies before entering a lease

If you're about to enter into a commercial lease or similar arrangement that gives you or another party rights to sell goods or services from a given location, it's important to familiarise yourself with relevant leasing legislation including the Retail Leases Act 1994. 

The Retail Leases Act prescribes certain requirements that must be followed by lessors and lessees and limits the effect of leasing terms that might otherwise be included in commercial leasing or similar arrangements.  

The Retail Leases Act may apply, even if your agreement says otherwise. For example, any clause excluding its application is invalid if an agreement meets the definition of a retail shop lease under the Act. A retail shop lease includes any agreement where a right of occupation is granted, whether or not the agreement is for exclusive occupation, express or implied, or made orally or in writing.  

“From time to time my office is contacted by parties in agreements that look very much like a retail lease, yet they have terms which purport to exclude the effect of the Retail Leases Act,” said Small Business Commissioner Chris Lamont. “Lessors should especially be aware of the risk an agreement could be considered a retail lease and therefore be inconsistent with requirements under the Retail Leases Act,” added Lamont.  

Lessees and lessors should consider getting independent and professional advice before signing a lease. The Retail Tenancy Guide provides more information about retail leasing, and lessees and lessors can contact the Commission to find out more about how we can assist. 

In the event of a dispute during the lease, the Commission offers a cost-effective mediation service which can help resolve lease disputes quickly and efficiently.