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Jansen Walsh and Grace



The decision of the Tribunal in Deus Software Pty Ltd v Acumen Auditors Pty Ltd (Building and Property) [2015] VCAT 1667 on 15 October 2015 shows the difficulties if you, as the landlord, have no written lease.  In that case, an accountant offered to lease the premises for, the landlord.  There was an exchange of e-mails, but no formal written lease.  Consequently, no right of re-entry was reserved.  The accountant defaulted in the payment of rent and outgoings.  The landlord changed the locks.  The landlord refused to allow the accountant to collect his goods in premises after re-entry unless the arrears had been paid.  The Tribunal found that the landlord had no right to do so.



You are obliged to give the tenant a Disclosure Statement and information brochure. If these documents are not provided to a tenant at the time when you enter into negotiation of the lease and preparation of the lease documents, then the tenant can:

1.  withdraw from the lease prior to entering into occupation of the premises; or
2.  within 28 days of the commencement of the lease.


The tenant is also entitled to a refund of the rental and other monies paid from the time when the tenant requested the Disclosure Statement and when it is ultimately provided.

What is a retail lease?
The Retail Leases Act applies to any premises from which goods or services are supplied to the general public.  The 2003 Act requires that this be the sole or predominant use of the premises and provides that the Act does not apply to any part used for residential purposes.  The Court of Appeal’s decision in IMCC Group (Australia) Pty Ltd v CB Cold Storage Pty Ltd [2017] VSCA 178 has held that “the ultimate consumer test” is the test in determining whether premises are “retail premises” and therefore governed by the Retail Leases Act 2003.

GST
GST is payable in addition to the rent and a tax invoice should be provided to you.  It is not necessary to give tax invoices monthly as they can cover, for instance, a year of monthly payments.

Outgoings
You pay the outgoings which are specified in the lease in addition to the rent, with one exception if it is a retail lease: land tax.

Security deposit or bank guarantee
You must provide either a bank guarantee or cash for the bond.  This must be invested on your behalf.

Transfer of lease and subletting
The lease allows you to transfer or sublet with the landlord’s consent, which cannot be unreasonably withheld.  Provided that the new lessee is clearly able to perform the lease and meet their obligations the landlord cannot refuse the assignment or subletting.

Signage
All signage requires the landlord’s consent and if this is a sensitive issue it should be set out in the lease.

Insurance
You have to take out insurance for $20 million to cover the risks.

Repairs and minatenance
Repairs and maintenance are your responsibility.  However, any work that may be required of a structural nature is the landlord’s responsibility.  The landlord has an obligation to maintain the property in the condition it was at the commencement of the term.

Fire levy and other essential services
Some retail leases require that you pay for the fire levy.  These leases are inconsistent with the Advisory Opinion of The Honourable Justice Garde dated 1 May 2025 and the decisions of Deputy President McNamara (as his Honour then was) in Chen v Panmure Hotel Pty Ltd [2007] VCAT 2464 and by Senior Member Senior Member Riegler in McIntyre v Kucminska Holdings Pty Ltd [2012] VCAT 1766.

Car parking
Car parking is often an issue and should be dealt with before commencement of the lease.

Your use of the premises
It is your responsibility to ensure that your use complies with the municipal council’s requirements.  However if there are any doubts whether the use is permissible, we can advise you.

Default
Default by you has two potential outcomes.  If the default relates to significant issues, such as payment of rent or the use to which the premises are put, then default entitles the landlord to take back possession of the premises, relet them, and recover the loss from you.  If the default were of a minor nature, then you would get relief from forfeiture leaving the landlord with a right to recover damages.

Possession
It is the usual practice to give you possession before all documentation is signed and exchanged and the initial rent bond and costs paid.