For most business owners leasing their premises from which they operate their business from is one of the most important business decisions they will make.

Whether it is an office, industrial, retail shop, warehouse, or other type of premises it is important that you understand the obligations that will be imposed on you as it is a cornerstone to your business’ presence and identity.

In the commercial market generally, you will find the lease will be described as a retail or non-retail lease.

What does a lease contain?

Leases contain a range of terms and conditions many of which you will find as standard such as:

• Parties
• Rent and rental reviews
• Duration
• Obligations of both the landlord and tenant
• Maintenance obligations and responsibilities
• Options to renew

This is not exhaustive but is the basic obligations contained in any lease.

Why get legal advice?

Whilst it may seem straight forward on the face of it lease terms and conditions can be complex and often drafted in such a way to heavily benefit one party and depending on the market conditions the party that is either trying to rent the premises or the party trying to occupy the premises.

Some of the issues that we see cause the most issues in relation to drafting, negotiating, and executing a lease are:

• Identifying the actual area that is to be leased including common areas
• What is the actual use permitted under the relevant authorities and what licences etc that are needed to trade lawfully
• Contributions to fit outs and the parameters around what will be permitted
• Rent free periods or incentives and how they are calculated
• Outgoings and their calculation, and the relevant proportions where other tenants maybe be sharing the premises
• Definitions of the terms
• How and when can rent be suspend or abated.

It is important to consider when entering a lease that you have experienced advice to ensure whether you are a landlord or tenant you understand your legal rights and obligations.

What happens when there is a dispute relating to a lease?

The best way to resolve a dispute is through direct communication preferably in writing to identify the issues.

The relationship between a landlord and tenant is often a long-term relationship and hopefully respectful and honest discussion will result in the matter being resolved.

If communication does not lead to a resolution, then it is often worth seeking a mediated resolution and this can be cost effective.

In Queensland the Small Business Commissioner offers free mediation services for certain disputes. There are also many private mediators and organisations that will for a fee, try and mediate the dispute.

If this is not successful, then you may be left with no option but to seek redress in the Queensland Civil and Administrative Tribunal (QCAT) or through the Courts. This can be an expensive, time consuming and stressful process so it is important to understand your legal rights and approach any dispute on a commercial basis.

We always emphasise to our clients that whilst there is no guarantee you will not have a dispute you can protect yourself by:

• Having a clear dispute resolution process
• Clarify any issues that do not appear to be correct whether it is a calculation or a request for repairs
• Keep records of all dealings and emails between the landlord/tenant and any property managers
• Make sure any notice that is required to be served pursuant to the lease terms is done so correctly

How can FC Lawyers help?

At FC Lawyers, our experienced commercial team assists both landlords and tenants with all their leasing requirements right through from negotiating and drafting a lease, enforcement of lease terms and conditions right through to appearing at mediations and contested hearings.

Contact our team today to discuss your legal needs regarding commercial leasing or business and property law in general.