The landlord and the tenant are bound to comply with the terms of the lease. If either party is in breach, the other party may have a right to end the lease.

If you are in a retail premises, then the law in each state varies on how landlords can evict tenants. If landlords do not comply with the relevant law and the terms in the lease, then tenants may take appropriate action against the landlord.

Leases are entered into between the landlord and the tenant for a fixed term and can only be terminated as noted in the lease. Many leases allow for landlords to terminate on the following breaches:

  1. Late payment of rent and other monies;
  2. Not operating the business in strict accordance with its permitted use;
  3. Not performing repairs and maintenance as specified in the lease;
  4. Not holding relevant insurances required;
  5. Transferring or subletting the lease without consent from the landlord; and
  6. Any other breach specified in the lease.

Some leases allow for notice to be provided before the landlord can terminate the lease, however this is not always the case. If no notice requirement is specified in the lease or legislation, the landlord can terminate the lease without notice.

Generally, many leases do not require notice for termination if rent is outstanding for eg by 14 days from the due date for payment. Thus, the landlord can re-enter the premises without notice and sue the tenant for damages.

Some states have legislation in place that requires landlords to serve a notice first before re-entry (for other breaches not relating to the payment of rent). These notices generally require:

  • Specifying the breach under the lease; and
  • If the breach is capable of remedy, requiring the tenant to remedy the breach; and
  • The tenant to pay compensation for the breach.

If the lease does not specify the notice's time frame, then reasonable time needs to be given to the tenant to remedy the breach.

If the landlord does not comply with the above requirements then, the tenant may take the landlord to court. The tenant may be able to receive compensation for illegal re-entry and an injunction on further such actions by the landlord.

To avoid termination of a lease without notice, it is advisable for tenants to insert in the lease a clause specifying notice of any breach of the lease and a reasonable opportunity to remedy the breach.

Before entering into a lease, it is advisable to have a lawyer specialising in commercial leases assist you. They can request changes on your behalf to the lease and ensure the lease gives you adequate protection generally and in circumstances such as this. If the lease is drafted correctly from the beginning, disputes should be easier to resolve or hopefully no disputes occur.

Found this helpful?

Share on:

Call Now Button