Lease Drafting, Reviews and Advice
Lease Drafting, Reviews and Advice
Should you have a draft lease or have been provided with a final lease document to sign, it is strongly recommended prior to signing the document that you obtain legal advice on the lease documentation. It would also be prudent to involve a lawyer in the review and negotiation of an offer to lease, which forms the basis of the formal lease.
If the lease is for a retail shop, there is specific legislation in Western Australia that regulates and controls what is allowed to be in a retail shop lease and what is potentially void and it is recommended to have the lease reviewed prior to execution. A tenant cannot sign a retail lease earlier than 7 days after being provided the landlord’s disclosure statement and this ensures the tenant has time to obtain legal and financial advice as required.
At D’Angelo Legal we are kept updated and are well aware of the legal requirements relating to leases and the obligations of either party. We can provide you with advice in relation to the proposed lease agreement, including your obligations under the agreement, and any recommended changes that you should ask for prior to accepting and executing the lease agreement.
Assignment of Lease
Assignment of Lease
Should you sell your business or, if for any particular reason, you wish to transfer your obligations under a lease, you will need to assign such rights and obligations by way of an assignment of lease agreement (subject to the lessor’s consent).
D’Angelo Legal is experienced in providing such advice and we will be happy to prepare the necessary documentation required, either on instructions from the landlord or the tenant, (if the landlord’s consent is granted).
We can also assist you in ensuring the assignment criteria of the lease are met, to ensure no undue delays in completing the assignment.
If you are being assigned a lease, you should take great care to ensure your obligations to make good at the end of the term are clear, as well as consider what other financial obligations you may inherit pursuant to the lease and assignment and we are able to provide this advice as required.
Variation of Lease
Variation of Lease
Leases may, over the period of their existence, need to be varied (by consent from all parties involved). It is important that if such variations are needed that these are properly recorded to ensure that both parties’ rights and obligations are correctly documented so as to prevent any confusion and /or dispute in the future.
D’Angelo Legal is experienced and happy to advise on the situation and prepare a variation of lease as instructed.
Sub-Lease
Sub-Lease
If there is excess or unused space to which you are currently paying rent for, you may consider the possibility of subletting the unused or excess space.
Alternatively, if you need to move your business to a new location, or relocate part of your business and an assignment of lease is not an option, you may need to find a new tenant to replace you for the term of your lease.
In such circumstances a sub-lease agreement may be the best solution for you. It is important to note that the difference between a sub-lease and an assignment of lease is that a sub-lease agreement does not generally void the obligations of the tenant under the original contract for lease. The obligations of the tenant and landlord still exist, regardless of the sublessee’s intentions or obligations under the sublease and the landlord must still usually consent to any sub-lease.
Prior to entering into a sub-lease we recommend that you contact us for advice to see if the existing lease will allow for the subletting and the conditions contained within the lease.
It is important to understand that a head tenant still remains liable to the landlord absolutely, even if there is a sub-lease in place. An assignment of lease may be a better option for the head tenant as the same usually means all of their rights and obligations are transferred.
Extension of Lease
Extension of Lease
Your lease may allow for further options such as a right to extend the lease agreement. If you decide to extend the lease, you should do so by a written agreement signed by all parties.
The purpose of the extension of lease is to document and ensure that your rights are protected in relation to the further option period under the lease. This also prevents any arguments as to whether the option was exercised or not.
In the absence of extension of leases it becomes difficult to prove in some circumstances whether an option has been executed correctly.
Quite often there is a rent review due at the option date and the parties should take steps to negotiate / complete the same prior to the tenant being bound to exercise the option, as a significant increase in rent could happen at this time.
Time is of the essence in exercising options and in some cases where the option is not exercised within the time periods permitted under the lease, the option may lapse and not be granted to the tenant.
D’Angelo Legal has the knowledge and experience in advising and preparing your extension of lease agreement. If you require any assistance in understanding your rights under a lease with respect to options and exercising an option then please do not hesitate to contact us.
Surrender of Lease
Surrender of Lease
It is important to surrender a lease prior to entering a new agreement to avoid any additional rights or obligations.
Alternatively, if all parties have agreed to end the lease earlier than the expiry date of the term, it is imperative that a surrender of lease be entered into to avoid either party from making a claim against the other party for their failure to honour their respective commitments under the lease.
D’Angelo Legal has the knowledge and experience in preparing surrender of lease agreements and we ensure the final obligations of the parties are made clear.
Lease Disputes
Lease Disputes
Lease disputes most often arise when the lease conditions are unclear, but can also occur for various reasons during the term of a lease. Such disagreements can include but are not limited to:
- Rent monies disputes;
- Lease term disputes;
- Assignment of lease requests that may be denied by a lessor;
- Bond disputes; and / or
- Maintenance disputes.
We provide plain English advice on your obligations under the lease and can assist in negotiating with the other party to try and resolve the issue for you. If negotiations fail, we can advise on the matter further should you require court or tribunal applications.