Business & Commercial Law
Commercial leasing
Do you need a premises from which to operate your business, or are you looking to lease a commercial or industrial property that you own? It is key that a lease is prepared which reflects the commercial terms agreed by the parties.
Typical terms of a lease include:
- Area to be leased – a clear legal and physical description of the premises to be leased including the use of facilities such as carparks, storage, amenities, and other common areas.
- Term of the lease – clearly detailed terms and renewal options that should coincide with the respective parties’ business and investment objectives.
- Rent and outgoings – including the method and time for reviewing rent and the outgoings payable by the lessee.
- Permitted use – allowing for the lessee’s intended use which may need to consider any proposed growth in business activities. Note that the lessee is responsible to ensure that any necessary approvals or licences are in place.
- Fit-out and refurbishment – if relevant, the lease should describe any fit-out permitted, who is responsible for costs and installation, whether fixtures may be removed by the lessee at the end of the lease and any refurbishment obligations when the lease expires.
A commercial lease should provide adequate protection for each party. For example, if a tenant does not pay on time, provisions should allow the lessor to charge interest on the amount owing and re-enter the premises if rent remains unpaid for a significant period of time.
As a tenant, you want to ensure that there is nothing hidden in the terms of the landlord’s ‘standard lease’ which can affect the operation of your business. Terms which limit your ability to access the premises outside business hours or conduct alterations to the premises may not align with your business objectives and are terms which will need to be negotiated with the landlord.
Retail leasing
The Retail Leases Act imposes certain requirements on landlords in relation to leasing retail premises. The Act requires that a draft lease and lessor disclosure statement (which details the terms, outgoings and contributions payable under the lease) be provided to the tenant within a certain period before the lease commences.
While this may seem like a mere formality, a failure to abide by these requirements can have dire consequences for a landlord which includes being unable to recover outgoings and contributions not identified in the disclosure statement. This may ultimately prevent you from getting the most value from your property.
Buying and selling a business
There are many facets to the sale or purchase of any business.
A contract for sale of business should encompass all aspects of a business and the agreed arrangements, including its employees, any leases or properties which may be included in the sale and any existing stock in trade.
Whether as buyer or seller it is essential that documents are drafted and negotiated correctly so that the business in question is transferred in its totality to the purchaser on settlement.
Debt recovery
Recovering a debt can sometimes end up costing more than the debt owed. There are a number of ways to recover a debt, and it is important that the correct strategy is selected. This will generally depend on the legal entity (individual, sole trader or company), the amount owed and whether there are any disputes concerning the debt.
One method of debt recovery is to serve on the debtor a statutory demand. A statutory demand requests that the debt owing be repaid within 21 days and, if it is not complied with, the debtor is legally presumed insolvent. If the debtor fails to pay the debt within this period or does not successfully apply to have the statutory demand set aside, winding up proceedings may be initiated in court.
Sometimes a well drafted letter of demand from a lawyer or a phone call may be all that is required to encourage a debtor to repay an outstanding amount.
If you need any assistance, contact us at [email protected] or call (02) 4588 5955 for expert legal advice.