The "Dad & Dave" case* is a good reminder for Landlords not to beat about the bush when giving notices to defaulting Tenants!
Many Landlords want to disqualify a Tenant from exercising an option to renew a Lease by relying on, and protesting about, an ongoing breach of the Lease by the Tenant. Section 133E of the Conveyancing Act 1919, prescribes the content for a formal written notice that a Landlord needs to serve on a Tenant in such circumstances. What is more, it specifies that such a notice needs to be served on a Tenant purporting to exercise an option to renew a lease during the 14 day period following the purported exercise of that option for renewal by the Tenant.
As a Landlord, you need to be aware of this short time frame for response and to promptly instruct your lawyer if you need to serve a Section 133E Notice on a Tenant.
In the Dad & Dave Case, the Landlord of a country pub and his lawyers sent letters to a Tenant threatening to issue a Notice and reserving their rights to do so but never actually gave the notice in the prescribed form , let alone within the 14 day time-frame to do so. The Tenant was therefore able to obtain a declaration from the Supreme Court (plus a costs order ) that it had validly exercised the option to renew the Lease.
The lesson to be learned from the Dad & Dave case is always to instruct us at the earliest possible date and with clear instructions, so that the applicable deadlines do not work against either the Landlord or the Tenant......and so that neither find themselves unwittingly up Snake Gully!
At Coleman Greig, we are happy to take instructions from either Landlords or Tenants and can advise either party on exercising options to renew Lease, or on challenging purported exercises of options for lease renewal. If you would like to speak an experienced commercial leasing expert contact Coleman Greig on ph: 02 9635 6422.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
