Wednesday, 31 January 2018

Retail Shop Leasing and Dispute Resolution

Retail shop leasing in Queensland is regulated through the Retail Shop Leases Act 1994 (RSLA) and the Retail Shop Leases Regulation 2006.

Part 8 of the RSLA details the mechanism where there is a retail tenancy dispute about a retail shop lease.

Notice of Dispute

Where the Lessor and Lessee cannot resolve a dispute, a Notice of Dispute in the approved form can be lodged with the Queensland Civil and Administrative Tribunal (QCAT) following which a mediator is appointed.

Mediation

The mediator will notify the parties of a date upon which a mediation conference will be convened.

It is important to note that a party cannot be compelled to attend mediation.

Generally, the Lessor and Lessee must represent and conduct their own case at the mediation conference.

The mediator’s role is to encourage the parties to reach a resolution of the dispute. If a resolution can be achieved this can be reduced in writing by way of a Mediation Agreement, which the parties will sign.

The mediator has jurisdiction over most issues of disputes, such as, regarding matters about use or occupation of a leased shop. However, the mediator does not have jurisdiction regarding the amount of rent payable, rent arrears or the amount of outgoings payable.

Rent and Outgoings Dispute

In terms of rent and outgoings, the mediator has jurisdiction to mediate about:
  • the procedure for the determination of rent payable under a retail shop lease, but not the actual amount of the rent; or 
  • the basis on which Lessor’s outgoings are payable by, and the procedure for charging Lessor’s outgoings to a Lessee, but not the actual amount of the outgoings; 
  • whether an item of the Lessor’s outgoings was reasonably incurred in relation to the operations, maintenance or repair of the centre or building. 
In the event the dispute relates to the amount of rent or outgoings payable:
  • where the amount in dispute is $25,000 or less, a “Minor Civil Debt Dispute” application through QCAT is the appropriate step in that instance; 
  • if the amount is $150,000 or less, a claim can be made through the Magistrates Court; 
  • money disputes up to $750,000 are dealt with by the District Court. 
QCAT


In the event:
  • a dispute is not resolved at the mediation conference; or 
  • a party does not attend mediation, 
the mediator must refer the matter to QCAT for determination.

The RSLA also provides for other situations in which a party may make direct application to QCAT.

It should be noted that evidence of anything said in a mediation conference is not admissible in any proceeding before any court or tribunal.

QCAT can make a range of orders at its discretion including but limited to:- (a) enforcement orders – being an order for a party to do, or not to do, something; (b) payment order - an order requiring a party to pay an amount (including an amount of compensation); (c) an order setting aside a mediation agreement; (d) an order in relation to outgoings – such as, where the Lessor’s outgoings were not reasonable; (e) an order setting aside a defective market rent valuation., etc.

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Disclaimer

The material provided in this document is for general information only and is not to be relied upon as advice. No responsibility is accepted for any loss, damage or injury, financial or otherwise, suffered by any person or organisation acting or relying on this information or anything omitted from it.

Copyright © Greyson Legal 2018, All rights reserved.

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