Commercial Lease Disputes
Commercial lease disputes are disagreements between landlord and tenant about how a lease should be performed or enforced. We act for both sides in lease disputes across Australia, from a single letter of demand through to tribunal hearings and litigation. For an overview of all our leasing services, see commercial lease lawyers.
Most lease disputes are resolved long before they reach a court or tribunal. The key to a quick, cheap resolution is getting the legal position clear early, framing the dispute correctly, and using the right forum.
Common types of lease dispute
Rent and rent review disputes
Disputes about whether a rent increase is permitted by the lease, whether a market rent review should go to a specialist retail valuer, and whether a CPI adjustment has been calculated correctly.
See: Rent Review Disputes
Outgoings disputes
Disputes over what outgoings the landlord can recover, whether the estimate and reconciliation have been provided in time, and whether items the relevant Act prohibits (commonly land tax in Victoria) have been wrongly charged.
See: Outgoings Disputes
Make good disputes
End-of-lease disputes about the condition the premises must be returned in, the cost of reinstatement, and whether the landlord can claim against the bank guarantee.
See: Make Good Disputes
Repair and maintenance disputes
Disputes about who is responsible for fixing what, particularly structural issues, essential safety measures, roof and water ingress, and HVAC failures.
See: Repair and Maintenance Disputes
Breach of lease and termination disputes
Disputes about whether a breach has occurred, whether the breach notice is valid, whether the landlord can re-enter, and whether the tenant has a claim for relief against forfeiture.
See: Breach of Lease and Termination
Quiet enjoyment and derogation from grant
Tenant claims that the landlord has interfered with the tenant’s right to occupy and use the premises (for example, building works, restricted access, competing tenants in breach of an exclusivity clause).
Bank guarantee disputes
Disputes about whether the landlord is entitled to call on the bank guarantee, the timing of release at the end of the lease, and any over-recovery.
Disputes on assignment, sublease, or surrender
Disputes about whether the landlord can withhold consent to an assignment or sublease, the conditions on consent, and the terms of any deed of surrender.
How we run a lease dispute
- Read the lease and the file. We start by working out the legal position. Most disputes turn on a handful of clauses and a small number of facts.
- Letter of advice. A short written advice on the strengths, weaknesses, and likely outcomes, with a recommended next step.
- Letter of demand or response. The first formal step in most disputes is a letter that sets out the position and what the other side needs to do.
- Mediation. For retail leases, mandatory mediation through the relevant small business commissioner is usually required before tribunal proceedings. For non-retail leases, we still recommend it as the cheapest fast resolution.
- Tribunal or court. VCAT, NCAT, QCAT, SAT, SACAT, ACAT, or NTCAT for retail leases; the Magistrates’ or higher court for non-retail leases and complex matters.
Where lease disputes are heard
- Victoria - VCAT (retail and most commercial leasing); Magistrates’ Court for non-retail debt and possession
- NSW - NCAT for retail leases; Local or District Court for non-retail
- Queensland - QCAT for retail leases; Magistrates’ or District Court for non-retail
- WA - State Administrative Tribunal for retail leases
- SA - SACAT or Magistrates’ Court depending on the issue
- Tasmania, ACT, NT - relevant tribunal or court
Most retail lease Acts require an attempt at mediation through the small business commissioner - such as the Victorian Small Business Commission - before the tribunal will hear the matter.
What outcomes we aim for
In most disputes, the right outcome is a quick negotiated settlement that leaves the lease intact (or cleanly terminated, where that’s the right result). We push hardest in the early stages because that’s where the cheapest wins are. Litigation is the last resort, not the first.
Frequently asked questions
How long do lease disputes take?
Most disputes are resolved within a few weeks of the first letter. Those that go to mediation through the small business commissioner usually conclude within a couple of months. Tribunal hearings, where needed, generally happen within four to six months of filing.
Do I have to go to mediation first?
For retail leases, usually yes. Most state Acts require a genuine attempt at mediation through the relevant small business commissioner before the tribunal will hear the dispute. Even where it’s not mandatory, mediation is often the cheapest fast resolution.
Can I take a commercial lease dispute to VCAT?
In Victoria, VCAT hears most retail tenancy disputes and many commercial leasing matters. Whether VCAT is the right forum depends on the type of lease, the issue, and the value of the claim. We confirm jurisdiction before filing.
How much does a lease dispute cost?
We scope disputes in stages: initial advice and letter of demand on a fixed fee, then mediation and tribunal work scoped after the position is clearer. You’ll always know the next step’s cost before we take it.
Can the landlord recover legal costs from me?
In most retail leases, the relevant Act limits or prohibits the landlord recovering legal costs from the tenant. In a non-retail lease, it depends on the lease terms and the tribunal or court’s discretion.
Should I keep paying rent during a dispute?
Generally yes. Withholding rent gives the landlord a clean breach to terminate the lease, and most tribunals will order back-payment anyway. We advise on whether any narrow exception applies.
Do you act for both tenants and landlords?
Yes, but never on the same dispute.
What do I need to send you?
The lease, the disclosure statement, any correspondence about the dispute, and a short summary of what’s happened. Email is fine. If you haven’t had the lease reviewed yet, consider a lease review as a first step.
Talk to a commercial lease disputes lawyer
Send us the lease and a short summary of the dispute and we’ll come back with a fixed-fee initial advice and a clear next step.