The COVID-19 Legislation Amendment (Emergency Measures) Bill 2020 (NSW) was passed by both Houses of the New South Wales Parliament on 24 March 2020, which received assent yesterday (Emergency Measures Act). Amongst other things, the Emergency Measures Act introduces a new Part 11 (Response to COVID-19 pandemic) into the Retail Lease Act 1994 (NSW) (Act).

In addition to the Act, the amendment (in Part 11) also applies to Agricultural Tenancies Act 1990, Boarding Houses Act 2012, Residential (Land Lease) Communities Act 2013 and any other legislation relating to the leasing of premises or land for commercial purposes. That is to say that the amendment also applies to commercial leases. Accordingly, it is likely that the Conveyancing Act 1919 (NSW) will also be impacted to the extent that it deals with restrictions on, and relief against, forfeiture of retail and commercial leases.

The new Part 11 of the Act has been established to enact a response to the COVID-19 pandemic, as it:

  1. prohibits the lessor (landlord) from recovering possession of premises or land from the lessee (tenant) in particular circumstances;
  2. prohibits termination of a lease by a lessor in particular circumstances;
  3. regulates or prevents the exercise or enforcement of another right of a lessor under the lease or an agreement relating to the premises in particular circumstances; and
  4. exempts a lessee, or a class of lessees, from operating a provision of the Act or any agreement relating to the leasing or licensing of the premises.

These regulations can only be made (upon the recommendation of the Minister to the Governor) in circumstances where:

  • Parliament is not sitting, and is unlikely to sit within two weeks after the regulations are made; and
  • in the Minister's opinion, the regulations are reasonable to protect the health, safety and welfare of lessees under the Act.

Regulations made under this section of the Act, expire six months after the regulation commences or an earlier date decided by Parliament (by resolution of either House of Parliament).

Moving forward in this current environment, landlords should be particularly mindful of the amendments to both retail and commercial leases during the COVID-19 pandemic, when dealing with tenants and the premises. Legal advice should be sought where situations relating to the provisions of the new Part 11 of Act are concerned. We are considering the COVID-19 pandemic and its impact on our landlord and tenant clients in real time and will continue to remain available for you during this global crisis.

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.