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ARTICLE · 06 NOVEMBER 2019

Is there a binding lease or agreement for lease?

Lesson to be taken away from recent case is to be very clear & do not take possession & pay rent until a lease is signed.

AustraliaReal Estate and Construction

Darzi Group Pty Ltd v Nolde Pty Ltd [2019] NSWSC 335

The parties entered into negotiations for a retail lease based on terms of a lease executed by the Tenant and submitted to the solicitors of the Landlord with respect to a restaurant premises located in Dorsal Hotel Forster owned by the Landlord ("15 June 2016 Lease"). The Tenant had been in occupation and operating out of the restaurant premises since late 2014 following the parties executing a heads of agreement.

The Tenant sought a declaration that the 15 June 2016 Lease was a binding lease. The Landlord sought a declaration that the Tenant was on a month-to-month lease.

The key issue is whether the parties reached a binding agreement for the lease of the restaurant premises on the terms of the 15 June 2016 Lease.

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