Commercial Tenancy (Retail Shops) Agreements Act 1985

Subject to subsection (2), a provision in a retail shop lease to the effect that the landlord or a person claiming through him is entitled to, or may require from the tenant —

key‑money; or

any consideration in respect of the goodwill of the business,

is void.

Without limiting subsection (1), where a retail shop lease provides to the effect that the landlord or a person claiming through him is entitled to or may require from the tenant money or any other benefit in consideration of —

a rent under the lease which is lower than the rent which would otherwise be payable; or

a future reduction in rent payable under the lease,

that money or other benefit is to be taken to be key‑money for the purposes of subsection (1) unless the landlord or person claiming through him proves otherwise.

Subsection (1) or (1a) shall not be construed so as to make void a provision in a retail shop lease for the landlord to receive or recover from the tenant —

any sum that the tenant has agreed to pay to the landlord in respect of the goodwill of a business carried on by the landlord in the retail shop concerned immediately before the lease was entered into; or

expenses reasonably incurred by the landlord in investigating a proposed assignee of the tenant or sub‑lessee of the premises; or

fair and reasonable expenses of the landlord in respect of the negotiation, preparation or execution of, or obtaining the necessary consents to, an assignment of the lease or a sub‑lease of the premises.

Any amount paid or the value of any benefit conferred by a person under a provision of a lease that is void by reason of subsection (1) or (1a) may be recovered by that person from the person to whom the amount was paid or on whom the benefit was conferred upon an application to the Tribunal for an order that the money sought be paid or in a court of competent jurisdiction as a debt due.

[Section 9 amended: No. 48 of 1990 s. 6; No. 55 of 2004 s. 119; No. 23 of 2014 s. 4.]

10. Tenant’s right to assign lease, landlord’s consent to assignment or sub-lease etc.

Notwithstanding any other written law, a retail shop lease shall be taken to grant to the tenant a right to assign the lease, subject only to a right of the landlord to withhold consent to an assignment on reasonable grounds.

Where a tenant under a retail shop lease has in writing requested the landlord to consent to —

an assignment of the lease; or

where the lease provides for a sub‑lease of the premises by consent, a sub‑lease of the premises,

and the landlord fails to give notice in writing of consent or withholding of consent to the tenant within 28 days after receiving the request, the landlord shall be taken to have consented to the assignment or sub‑lease, as the case may be.

A provision in a retail shop lease to the effect that the landlord may withhold consent to an assignment of the lease by a tenant unless the tenant or a guarantor of the tenant, agrees to pay any moneys that are payable under the lease by the person to whom it is proposed to assign the lease is void.

A provision in a retail shop lease to the effect that the landlord or a person claiming through the landlord may recover from the assignor or from a guarantor of the assignor, any moneys that are payable under the lease by the tenant to whom the lease has been assigned is void.

In this section —

assignor means a tenant who assigns a lease in accordance with this section;

guarantor means a person who has guaranteed the performance by a tenant of the tenant’s obligations under a retail shop lease or a person who has indemnified a landlord against any loss the landlord may incur as a result of the failure by a tenant to comply with those obligations;

moneys payable under the lease includes moneys recoverable by action under the lease.

[Section 10 inserted: No. 48 of 1990 s. 7; amended: No. 66 of 1998 s. 6.]

11. Rent review, provisions for in lease and conduct of etc.

A provision in a retail shop lease for review of the amount of rent payable under the lease during the currency of the lease is void unless the lease specifies, in respect of each occasion on which the review is to be made, a single basis on which the review is to be made.

If a retail shop lease provides for the review during the currency of the retail shop lease of the amount of rent payable under the retail shop lease having regard to the market rent of the retail shop concerned —

that market rent shall, for that purpose, be taken to be the rent obtainable at the time of that review in a free and open market as if, all the relevant factors, matters or variables used in proper land valuation practice having been taken into account, that retail shop were vacant and to let on similar terms as are contained in the current retail shop lease, and is not to take into account the value of —

the goodwill of the business carried on in the retail shop; or

any stock, fixtures or fittings in the retail shop that are not the property of the landlord; or

any structural improvement, or alteration, of the retail shop carried out, or paid for, by the current tenant;

and

unless specific provision is made in the retail shop lease for the time at which a review may be initiated, a party to the retail shop lease may not more than 3 months before the date on which that review is to be carried out and not more than 6 months after that date, initiate the review by notice in writing served on the other party to the retail shop lease; and

a provision in the retail shop lease purporting to preclude the increase or reduction of that market rent or to limit the extent to which that market rent may be increased or reduced is void.

A provision in a retail shop lease purporting to preclude the tenant from voluntarily disclosing the rent under the lease is void.

A retail shop lease that provides for review of the amount of rent payable during the currency of the lease shall be taken to provide that where the parties do not agree on the rent payable as a result of the review, the question shall be resolved, subject to subsection (5), by any of the following —

a person licensed under the Land Valuers Licensing Act 1978 agreed to by each of the parties;

a person licensed under that Act and nominated, at the request of each of the parties, by the Small Business Commissioner;

2 persons licensed under that Act, one of whom is appointed by the landlord and one of whom is appointed by the tenant.

If the parties to a retail shop lease referred to in subsection (3) do not agree on the rent payable as a result of the review concerned, the rent payable immediately before that review shall not be increased or reduced before the question is resolved or determined under this section, but nothing in this subsection prevents any increase or reduction in rent which takes place after that resolution or determination from being due and payable with effect from the date of that review.

A landlord under a retail shop lease must, to assist in determining the rent payable as a result of the review, within 14 days after being given a written request to do so by a person who acts under subsection (3), give that person such relevant information as is requested, including any of the following information, about leases for retail shops in the same building or retail shopping centre —

current rental for each lease;

rent free periods or any other form of incentive;

recent or proposed variations of any lease;

outgoings for each lease;

any other information prescribed for the purposes of this paragraph.

If a landlord fails to comply with a request made under subsection (3B) without reasonable excuse —

the person who made the request must, within 7 days after the landlord has failed to comply with the request, give to the tenant written notice of the landlord’s failure; and

the tenant may apply in writing to the Tribunal for an order that the landlord comply with a request made under subsection (3B) to supply the information requested.

A person who acts under subsection (3) shall, at the request of and on payment of the required fee by a party to the lease, provide reasons for his decision in writing to that party.

Notwithstanding subsection (3), a party to a retail shop lease may refer to the Tribunal for determination a question as to the rent payable as a result of the review by the parties where —

the persons acting under subsection (3)(b) fail to reach an agreement on the rent to be paid; or

a person has not acted under subsection (3) and the leave of the Tribunal has been obtained,

but otherwise such a question shall not be referred to the Tribunal.

[(6), (7) deleted]

In determining a question under subsection (5) the Tribunal, after considering all the circumstances of the case, may determine that any increase or reduction in rent payable as a result of the determination of the Tribunal under that subsection is payable over such period as the Tribunal thinks fit.

[Section 11 amended: No. 48 of 1990 s. 8; No. 66 of 1998 s. 7; No. 55 of 2004 s. 120; No. 20 of 2011 s. 31; No. 59 of 2011 s. 8.]