NOTE: On 14 July 2021, the NSW Government enacted the Retail and Other Commercial Leases (COVID-19) Regulation 2021 (the Regulation). Under the Regulation, landlords will be prevented from taking any prescribed action against an tenant impacted for a breach of the lease occurring during the prescribed period, unless they have attempted mediation.
This Regulation lapsed on 30 June 2022. However, commercial tenants will continue to be protected by certain provisions in the Regulation.
For more information, see Commercial leases and COVID-19 FAQs.
If you have been locked out of your commercial/ retail shop, or have received Termination Notice, here are some quick points that you may wish to keep in mind.
You owe rent
It may be important to note, that falling behind on your rent payments may be considered a fundamental breach of your Commercial or Retail lease; as such the landlord may choose to “reserve their right to re-occupy without notice.”
However, there may be a grace period, whereby a certain amount of days is provided before you are locked out of the premises. Refer to your Commercial contract or the Retail Leases Act 1994 (NSW) for further information.
If you are still unsure, you may wish to seek legal advice about alternate pathways (such as seeking a remedy through court). You can also contact us to discuss some strategic ways forward with our Mediation Services team.
You owe rent – but there’s reasons
You may have reasons why you have withheld paying rent, perhaps you are in dispute with the landlord.
Please note, we do not suggest you withhold payment of rent rent, as again this may put you in breach of your contract which may have further consequences.
Instead you may consider some options such as seeking legal advice, directly negotiating with the landlord, or mediation in view of early resolution of the issues.
Mediation is a voluntary process, where the parties discuss the issues before deciding on their best way forward. If you find yourself in this situation, please contact us and our team will walk you through some strategic options, including the mediation process.
You are up to date with rent, however still received a termination notice
In situations where your contracted lease term has expired and you have not taken up an option to extend the term, nor renewed your lease; then you may be trading on a "hold-over" or month to month basis.
In this instance, the landlord may wish to reoccupy the premises and therefore has provided you notice to vacate. If this is the case, we suggest you check your contract for the required vacancy notice.
If you have received notice to vacate, however would like to stay on further, there may still be options for you to consider. Some of these options include directly negotiating with the landlord regarding terms of an extension. Alternatively, you may wish to consider mediation.
Please contact us to speak with our Mediation Services team.
Learn more about holdover leases.
Going to court and relief against forfeiture
If you have been locked out of your retail or commercial shop, you may consider applying for Urgent “relief against forfeiture” from the relevant court or tribunal, within the appropriate jurisdiction.
This means that a court may reinstate your lease, so that you re-gain access and re-enter the lease. For example, with regard to Retail leases - under section 72(1)(d) of the Retail Leases Act 1994 (NSW), the NSW Civil and Administrative Tribunal may exercise its discretion to grant this relief if “it considers appropriate”, having regard to all the circumstances of the particular case.
The application to court can be done on an urgent basis, however may still take a period of time to get a hearing. Please note, conditions may apply so to qualify for the forfeiture relief.
In this scenario, it may be best to seek legal advice so to discuss your rights and obligations. You can also contact our team to discuss some strategic options that you may wish to consider.