In brief

The Retail Leases Act 2003 (Vic) (Act) applies to a lease as a matter of law and cannot be made to apply to a lease, or excluded from a lease simply by stating this in a lease.

What you need to know

  • The Act cannot be excluded from applying to a lease, and parties cannot make the Act apply to a lease.
  • Nothing prevents sections of the Act being incorporated into a lease.

Background

We were recently asked to consider a lease in which the parties sought to contract into the Act, by stating that the Act applied to the lease.

Section 94 of the Act relevantly provides that the Act prevails over any inconsistent provisions in a lease, and a lease is void to the extent that it purports to exclude the application of a provision of the Act. However, the Act does not state that you cannot contract into the Act and there is no similar provision to section 94 addressing whether you can make the Act apply to a lease.

The lease clause in question simply stated that certain sections of the Act applied to the lease. In our view, it is not possible to contract into the Act, which will apply as a matter of law to the lease, or not apply as the case may be.

If parties want to ensure that certain sections of the Act apply to a lease, we suggest replicating those sections and inserting them in the lease. The sections then have effect, as they will be contractual provisions in the lease. For instance, if a tenant wanted to ensure that land tax was excluded from a lease, there is no reason why the relevant section of the Act could not be replicated and inserted in the lease. This will be effective in excluding land tax in a lease.

Conclusion

Parties cannot contract into or out of the Act. However, if a landlord or a tenant wanted certain sections of the Act to apply, we suggest replicating the relevant provisions of the Act and inserting those provisions in the lease.

About the Author

Rohan Ingleton

Partner
A telecommunications and retail leasing expert, Rohan is a property specialist with an enviable reputation.

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