In an August 2024 decision (Ngo v Sin & Partner Pty Ltd) the NSW Civil & Administrative Appeal Panel had cause to consider an appeal from a retail lease lessee seeking rent relief and an extension of the lease term.
The decision made by the Appeal Panel is notable for the confirmation it provides on the following points:
In summary, this decision underscores that while the Tribunal is not empowered to modify lease terms under the COVID Regulations, it may still address claims of unconscionable conduct by awarding damages in relevant circumstances.
- Where there has been no negotiation or a failed negotiation for rent relief pursuant to the COVID Regulations, a lessee is not entitled to apply to the Civil & Administrative Tribunal (Tribunal) for an order that rent be reduced, waived or deferred. However, it should be noted that the lessor may be unable to take a prescribed action against the lessee.
- Where the lessee alleges unconscionable conduct (for example the lessor failing to negotiate or not negotiating in good faith), the Tribunal may order the payment of damages.
- The effect of the COVID Regulations is to protect an impacted lessee from enforcement and recovery actions by a lessor and require the parties enter into negotiations. The COVID Regulations and the Retail Leases Act do not grant the Tribunal power to modify lease terms.
In summary, this decision underscores that while the Tribunal is not empowered to modify lease terms under the COVID Regulations, it may still address claims of unconscionable conduct by awarding damages in relevant circumstances.
