Breaches of lease between exercise of option to renew and expiry of lease in Queensland

Duncan, William D. (2015) Breaches of lease between exercise of option to renew and expiry of lease in Queensland. Australian Property Law Bulletin, 30(8), pp. 133-134.

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Abstract

The decision of Greppo v Jam-Cal Bundaberg Pty Ltd [2015] QCA 131 illustrates a defect in s 128 of the Property Law Act 1974(Qld) which gives a right to a lessee to apply for relief against forfeiture against loss of a right to exercise an option to renew. The defect arises because the legislation does not adequately deal with breaches that occur after the exercise of the option but before the expiry of the lease. Most commercial leases of all kinds have a standard provisions, as the lease in this case, as a conditions of the exercise of the option to renew that the lessee will have given notice of exercise within the time specified to the lessor and will have up to the date of expiry of the lease paid all rent and observed all lessee’s covenants. The difficulties occur because invariably an option must be exercised before the expiry of the lease when a lessee may not be in breach of the lease but may later prior to the expiry of the lease fall into breach. As this decision indicates,at least in Queensland, that the lessee who desires to challenge the lessor’s right to enforce those conditions can neither seek relief under s 128 against forfeiture of the right to exercise the option ,or indeed, under s 124 of the Property Law Act 1974 to preserve the agreement for lease brought about by the otherwise regular exercise of the option to renew. The decision cries out for legislative reform along the lines of s 133E of the Conveyancing Act 1919(NSW) which was amended in 2001 to meet this contingency.

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ID Code: 87600
Item Type: Journal Article
Refereed: Yes
Keywords: property law, breaches of lease, option to renew lease
ISSN: 0817-2854
Subjects: Australian and New Zealand Standard Research Classification > LAW AND LEGAL STUDIES (180000) > LAW (180100)
Australian and New Zealand Standard Research Classification > LAW AND LEGAL STUDIES (180000) > LAW (180100) > Commercial and Contract Law (180105)
Australian and New Zealand Standard Research Classification > LAW AND LEGAL STUDIES (180000) > LAW (180100) > Property Law (excl. Intellectual Property Law) (180124)
Divisions: Current > Research Centres > Commercial & Property Law Research Centre
Current > QUT Faculties and Divisions > Faculty of Law
Current > Schools > School of Law
Copyright Owner: Copyright 2015 Lexis Nexis Butterworths
Deposited On: 22 Sep 2015 01:23
Last Modified: 27 Sep 2015 05:08

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