Corporations Act 2001

This section applies if:

under an agreement made before the control day in relation to a controller of property of a corporation, the corporation continues after that day to use or occupy, or to be in possession of, property (the third party property) of which someone else is the owner or lessor; and

the controller is controller of the third party property.

Subject to subsections (4) and (7), the controller is liable for so much of the rent or other amounts payable by the corporation under the agreement as is attributable to a period:

that begins more than 7 days after the control day; and

throughout which:

the corporation continues to use or occupy, or to be in possession of, the third party property; and

the controller is controller of the third party property.

Within 7 days after the control day, the controller may give to the owner or lessor a notice that specifies the third party property and states that the controller does not propose to exercise rights in relation to that property as controller of the property, whether on behalf of the corporation or anyone else.

Despite subsection (2), the controller is not liable for so much of the rent or other amounts payable by the corporation under the agreement as is attributable to a period during which a notice under subsection (3) is in force, but such a notice does not affect a liability of the corporation.

A notice under subsection (3) ceases to have effect if:

the controller revokes it by writing given to the owner or lessor; or

the controller exercises, or purports to exercise, a right in relation to the third party property as controller of the property, whether on behalf of the corporation or anyone else.

For the purposes of subsection (5), the controller does not exercise, or purport to exercise, a right as mentioned in paragraph (5)(b) merely because the controller continues to be in possession, or to have control, of the third party property, unless the controller:

also uses the property; or

asserts a right, as against the owner or lessor, so to continue.

Subsection (2) does not apply in so far as a court, by order, excuses the controller from liability, but an order does not affect a liability of the corporation.

The controller is not taken because of subsection (2):

to have adopted the agreement; or

to be liable under the agreement otherwise than as mentioned in subsection (2).