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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.

Background

Tivoli Retail Pty Ltd (Landlord) rented premises to Metcash Food & Grocery Pty Ltd (Tenant) by way of lease entered into on 15 June 2012 (Lease). In August 2016, discussion regarding market rent could not be agreed on nor could a specialist retail valuer to determine the rent and so a QCAT nominated a valuer who then determined the market rent.  The Landlord did not agree with the valuer’s determination and filed a Notice of Dispute seeking an order to set the rental determination aside.  The Tenant however, applied to the Tribunal to strike out the Landlord’s Notice of Dispute on the ground the QCAT did not have jurisdiction to determine the dispute because it is not a “retail tenancy dispute”

Does the Tribunal have jurisdiction?

Section 64 of the RSLA, allows a party to a retail tenancy dispute to apply to QCAT for an order to resolve a dispute.

At the time the lease was entered into, the RSLA in operation at that time, excluded from the definition of “retail shop lease” a lease of a retail shop with a floor area of more than 1,000sqm by a listed corporation or a listed corporation’s subsidiary.  As the floor area of the premises is more than 1,000sqm (i.e. 1,504sqm) and as the Tenant was a subsidiary of the listed corporation of the Tenant, the QCAT found the dispute was not about a “retail shop lease” and therefore the dispute between the parties regarding the market rent determination was not a retail tenancy dispute under the RSLA and was outside of the QCAT’s jurisdiction.

Can the Landlord and Tenant just “agree” that the RSLA applies?

Parties to a lease can agree to insert clauses in a lease to adopt certain concepts which are similar to those in the RSLA however this in itself does not result in the lease being a “retail shop lease” under the RSLA nor the parties being able to resolve a dispute about the lease at QCAT.  In the present case, it took many months before questions arose as to whether or not the Lease fell under the “retail shop lease” definition and thereafter the question of jurisdiction arising.

The Landlord submitted that s83(2)(j) of the RSLA conferred jurisdiction however, the QCAT found s83 applies to orders that the QCAT may make “within the substantive jurisdiction conferred upon it” and therefore did not confer jurisdiction upon the QCAT.

Conclusion

As the QCAT did not have jurisdiction in this matter, the Notice of Dispute was struck out for want of jurisdiction. This case is a reminder to each party to understand which Act their lease falls under in order to properly resolve disputes.

Gillian Kirwan, Lawyer
Paul Carroll, Partner

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