WA bills for commercial tenancies tabled

April 17, 2020

Uncategorized

Bills have been tabled before the Western Australian Parliament to enact the WA State Government’s response to the COVID-19 pandemic with respect to commercial tenancies.

The Bills are available here:

https://www.parliament.wa.gov.au/Parliament/Bills.nsf/ED7097E743C7BC2D4825854C00102B97/$File/186-1.pdf

https://www.parliament.wa.gov.au/Parliament/Bills.nsf/7CDCFDA8EE2BA09C4825854C00139362/$File/188-1.pdf 

Highlights of the WA Bills are:

  1. It applies to small commercial tenants, which is defined by reference to other WA legislation.  It is unclear at this stage whether this extends as far as the Code (which applies to tenants with a turnover of up to $50M).
  2. Small commercial tenants suffering severe financial hardship on account of the COVID-19 pandemic (ie that are unable to meet their obligations under their lease) have the ability to terminated the lease on 21 days notice.  The landlord has the ability to challenge that notice before the WA equivalent of VCAT.  Importantly, there has been no indication from the Victorian Premier that a similar termination right will be enacted in Victoria, and there is no reason for practitioners to expect this to appear in the Victoria’s equivalent legislation.
  3. The WA Bill operates retrospectively from 30 March 2020.  Any actions taken between that date and the commencement of the legislation (such as calling on securities) are not invalidated, but incomplete actions are stayed for the time being.
  4. The Bills apply to leases and licences.  Many franchisees in Victoria operate under franchisee outlet licences (as opposed to leases) and their status under tenancy laws is often the subject of debate.
  5. Incorporated associations are also covered, which would extend to many not-for-profits such as sporting clubs.
  6. It looks like the Bill will incorporate the Code thorough Regulations and then creates a regime for mediation and, if necessary, litigation to enforce its terms.  The Tribunal is given the power to make various orders, including orders for waiver and deferral of rent.  We don’t yet know whether the Victorian Parliament will adopt the Code unchanged or adopt more detailed legislation that reflects the principals embodied in the Code.

Thanks to Alan Wein for his assistance on this post.

About Sam Hopper

Sam is a property and insolvency barrister.

View all posts by Sam Hopper

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