Tenancy Issues During Covid-19

//Tenancy Issues During Covid-19

Tenancy Issues During Covid-19

The Prime Minister has urged landlords and tenants to negotiate workable arrangements to see them through a period of at least the next 6 months.  Our team can assist you in negotiations, or in the implementation of any agreement for the immediate future and the remainder of your lease.

National Cabinet made further progress on the issue of commercial tenancies. They have agreed that a mandatory code of conduct guided by certain principles will be developed and subsequently legislated by State and Territory Governments to apply for tenancies where the tenant is eligible for the Commonwealth Government’s JobKeeper assistance and is a small or medium-sized enterprise (less than $50 million turnover).

The principles that guide the code will be: 

  • where it can, rent should continue to be paid, and where there is financial distress as a result of COVID-19 (for example, the tenant is eligible for assistance through the JobKeeper program), tenants and landlords should negotiate a mutually agreed outcome;
  • there will be a proportionality to rent reductions based on the decline in turnover to ensure that the burden is shared between landlords and tenants;
  • there will be a prohibition on termination of leases for non-payment of rent (lockouts and eviction);
  • there will be a freeze on rent increases (except for turnover leases);
  • there will be a prohibition on penalties for tenants who stop trading or reduce opening hours;
  • there will be a prohibition on landlords passing land tax to tenants (if not already legislated);
  • there will be a prohibition on landlords charging interest on unpaid rent;
  • there will be a prohibition on landlords from making a claim to a bank guarantee or security deposit for non-payment of rent; and
  • ensure that any legislative barriers or administrative hurdles to lease extensions are removed (so that a tenant and landlord could agree a rent waiver in return for a lease extension).

For landlords and tenants that sign up to the code of conduct, States and Territories have agreed to look at providing the equivalent of at least a three month land tax waiver and three month land tax deferral on application for eligible landowners, with jurisdictions to continue to monitor the situation. Landlords must pass on the benefits of such moves to the tenants. In cases where parties have signed to the code of conduct, the ability for tenants to terminate leases as mentioned in the National Cabinet Statement on 29 March 2020 will not apply. Mediation will be provided as needed through existing State and Territory mechanisms.

As you are aware, our offices are open and we are able to assist you with:  

  1. remote conferencing with clients and counsel;
  2. virtual court appearances;
  3. signing documents electronically and remotely; and
  4. electronic conveyancing and electronic document registration including remote verification of identity (VOI).

 Please do not hesitate to contact us on 9525 8688.

By |2020-04-06T04:26:04+00:00April 6th, 2020|LEGAL NEWS|