Written by Ben Malone on June 2, 2020
The Retail Shop Leases and Other Commercial Leases (COVID-19 Emergency Response) Regulation 2020 (QLD) (QLD Regulations) came into effect on 28 May 2020.
The QLD Regulations largely mirror similar laws introduced by other States and Territories to implement the National Cabinet’s Code of Conduct for commercial tenancies, however there are a number of important differences that QLD landlords and tenants will need to be aware of.
The QLD Regulations apply to “affected lessees”, being a tenant under a commercial or retail lease where the tenant has a turnover of less than $50M and is eligible for JobKeeper. For the purposes of the turnover test, if the tenant is an entity connected with (or an affiliate of) another entity it will be the aggregate annual turnover of those entities.
If an affected lessee breaches the lease by ceasing trade or not paying rent/outgoings (wholly or partly) during the period 29 March 2020 to 30 September 2020, a landlord is prevented from (amongst other things) doing or continuing the following actions:
unless the landlord has made a genuine attempt to negotiate and the tenant has substantially failed to comply with the negotiation process. Rent also cannot be increased during this period (except turnover rent).
The QLD Regulations impose obligations on landlords and tenants to cooperate and act in good faith in all discussions and actions associated with mitigating the effect of the COVID-19 pandemic on each other.
Either party can trigger the renegotiation process and, once triggered, the parties must both give each other information relating to the request that is true, accurate and sufficient to enable the parties to negotiate in a fair and transparent way.
The QLD Regulations helpfully give examples of the information required, namely turnover information, evidence of JobKeeper eligibility and details of steps the tenant has taken to mitigate the effects of the pandemic. A tenant may also apply for further rent reduction if circumstances materially worsen after an initial agreement is reached – but notably, they do not deal with the alternate scenario of circumstances improving for the particular tenant. Landlords should consider this issue in reaching and documenting any agreement with tenants.
One of the most critical changes the QLD Regulations impose is that landlords must offer tenants an extension to the term of the lease on the same conditions as those contained in the lease equivalent to the period for which rent is waived or deferred. The only exception to this absolute obligation is where the landlord would be in breach of another legal obligation in doing so, or if the landlord demonstrates that the lease cannot be extended because it intends to use the premises for a ‘commercial purpose of the landlord’.
Some other interesting differences about the QLD Regulations when compared to other jurisdictions:
Sincere thanks to our wonderful clients and hard-working team for supporting our inclusion in the Legal 500 (Asia Pacific) Guide as a leading firm in Real Estate for 2023
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February 10, 2023
We are delighted that Massons has been selected as an “Excellence Awardee” in the category of “Boutique Firm of the Year” at the 2022 Australasian Law Awards.
Thank you to all of our wonderful clients who have supported our nomination in this category, and to our amazing lawyers and support staff for making this possible!
Wishing all the other Awardees the best of luck and looking forward to the Gala Dinner. A night out with our team is always cause for celebration – win, lose or draw!!
March 23, 2022
We are excited about our inclusion in Doyle’s Guide for 2022 for NSW in the following categories:
Massons – Leading Property & Real Estate Law Firms
Jodie Masson – Leading Property & Real Estate Lawyers and Leading Leasing Lawyers
Leisha de Aboitiz – Leading Property & Real Estate Lawyers and Leading Leasing Lawyers
Ben Malone – Property & Real Estate Law Rising Stars
Thank you to all of our peers and wonderful clients who have helped to achieve this recognition.
March 14, 2022
February 28, 2022
We are excited to announce the appointment of Alex Ho as a Senior Associate at Massons. Alex started with us as a paralegal and has achieved this milestone in record time due to his hard work, his ability to develop and sustain fantastic relationships with clients, his engagement in constantly seeking to improve himself and others in equal measure, and his absolutely infectious enthusiasm. We couldn’t be prouder! Congratulations Alex!
January 5, 2022
December 8, 2021