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Leasing and Property Newsletter - September 2018

Leasing and Property Newsletter – September 2018

Published on September 13, 2018 by Paul Carroll , Matthew Rafferty , Alex Collie and Gillian Kirwan

In this edition our team report on the following topics:
  1. Can a landlord and tenant agree that the retail legislation applies?
  2. The NSW Government ban the use of aluminium composite panels (ACP) with a core that consists of more than 30% polyethylene within certain buildings of two-storey height or greater: and
  3. Can a tenant claim additional loss after the parties agree to a rent abatement to apply while the air conditioning does not work?

If the Act does not apply ….. it does not apply

The Queensland Civil & Administrative Tribunal (QCAT) found a landlord and a tenant cannot just decide to “agree” that the Retail Shop Leases Act 1994 (Qld) (RSLA) applies to their lease in circumstances where the legislature has provided for the RSLA not to apply.

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Gillian Kirwan, Lawyer
Paul Carroll, Partner

Uncertainty within the foundations: the NSW ban on aluminium cladding and implications of the Building Products (Safety) Act 2017

In response to the Grenfell Tower fire that saw the deaths of 72 people in West London in June 2017 and the earlier Lacrosse building fire in Melbourne, the NSW Government passed on 23 November 2017 the Buildings Products (Safety) Act 2017. The Act allows the certain building materials to be declared as prohibited where there are reasonable grounds that the use is unsafe. As was expected following the commencement of this Act,  Rosemary Ann Webb, the Commissioner for Fair Trading, Department of Finance, Services and Innovation, published a notice banning the use of aluminium composite panels (ACP) with a core that consists of more than 30% polyethylene within certain buildings of two-storey height or greater. This ban commenced on 15 August 2018 and applies not only to new buildings but also to existing buildings constructed prior to the prohibition. The financial ramifications following the banning of ACP and the potential future prohibition of other building materials could be significant for property owners.

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Alex Collie, Lawyer
Paul Carroll, Partner

Was the rent abatement for no air conditioning the end of the matter?

The air conditioning system in a leased premises failed as the lease was being entered into. The landlord and tenant agreed on an abatement that would apply until the air conditioning system was fixed, and the lease continued on that basis. The tenant leased a number of adjoining premises and intended to sublease them all together for use as a medical centre. The lack of air conditioning in this particular small premises meant that it was unable to be used as part of the medical centre. The tenant subleased it to accountants instead, but obtained significantly less rent. Later, the tenant claimed additional compensation for loss resulting from the failure of the air conditioning system.

Could the tenant claim additional loss, even though they appeared to have accepted an abatement as compensation for the lack of air conditioning?

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Matthew Rafferty, Partner

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