Retail Lease:
Retail Tenancies core jurisdiction is enabled by section 81 and 89 of the Retail Leases Act 2003.
Retail Leases Act 2003 is the mechanisms available to resolve disputes concerning leases of retail premises and promote greater certainty, fairness and clarity in the commercial relationship between landlords and tenants of retail premises.
Retail Tenancy disputes are basically disputes between landlord and tenants under or in respect of retail premises leases.
A retail tenancy dispute as defined in the Retail Leases Act 2003 but logical necessity also means it is a consumer trader dispute within the meaning of Consumer Law.
To put it another way, retail tenancy disputes are a sub-set of consumer trader disputes.
Again, it is a matter of discretion whether proceedings relative to retail tenancy disputes are heard in the Civil Claims List if commenced there or in the Retail Tenancies List.
The discretion seems to be informed by the same considerations as I mentioned with regard to domestic building disputes.
Before any matter goes before the Retail Tenancies List the parties must attempt to settle at the Small Business Commissioner (SBC) (except with an injunction application):
- All Retail Tenancies dispute must first receive a certificate from the SBC that mediation was conducted before VCAT will hear the matter.
- SBC mediations are generally held about 8-10 weeks after the dispute.
- Of all the matters heard at the SBC, around 85% have been disputes referred under the Retail Leases Act.
- The length of a mediation is generally 3-4 hours with a success rate of settle disputes at 74%.
- Where SBC mediation fails, SBC gives a certificate enabling access to VCAT.
- The process on the Retail Tenancies List once the SBC stage has been tried is very similar to Civil List claims.
The most common causes of disputes on Leases:
- Failure to pay rent; 25 per cent of retail tenancy disputes brought forward by landlords typically are matters of rent and outgoings.
- Tenant locked out of premises without adequate notice to rectify breach;
- Breach of Lease – tenant using the premises for a purpose other than that specified in the lease and permitted by the planning permit;
- Subletting tenancy without the permission of the Landlord;
- Damage to premises;
- Failure to maintain the premises by either the Landlord or Tenant;
- Repairs to premises;
- Relocation;
- Refusal to consent to assignment of leases;
- Unconscionable conduct.
- Commencing unauthorised works to premises;
- Tenant’s refusal to vacate at the conclusion of the Lease
- Landlord failing to provide Tenant with quiet enjoyment of the leased premises;
- Withholding security deposit (bond) at the conclusion of the lease term;
- Misunderstandings about outgoings – payment and interpretation;
- Rent Reviews – fixed increase, to market & CPI;
- Exercise of Options and Assignments – failure to notify within the prescribed timeframe.
Most of landlord and tenant disputes can be heard in the Retail Tenancies List or on the Civil List and via Australian Consumer Law. For example disputes about leases of factories and disputes about short-term leases (sub 12 months) of shops and disputes about a licence as distinct from a lease arrangement should be heard under Consumer Law and on the Civil List.
Commencement of proceeding is regulated by the Retail Tenancies Act and sections 67-72 of the VCAT Act:
- Similar to Domestic Building, the Retail Tenancies List use an online application form.
- The Retail Tenancies List commonly runs in a very formal manner, with counsel attending and presenting the case as they would to a Court.
- The Tribunal has discretion to timetable a case in any way it sees fit, so the larger the amount in dispute, the more Court like the procedures become.
- Save in minor disputes it is customary to have the full range of interlocutory steps and the holding of purely summary hearings without pleadings or other preliminaries is the exception rather than the rule.
- VCAT is loathe to enter into pleading fights save where there is an argument about correct parties or insufficient details. Such arguments are usually taken up at directions hearing, or by bringing on an application for further directions. This is only usually allowed in larger or more complex cases.
The tribunal can order a party to do something or not do something relating to the premises or the lease, for example:
- pay compensation;
- correct the lease;
- recovery of possession by the landlord.
Daniel Epstein of Counsel
