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BUSINESS THROUGH INNOVATION LEGAL 38
RET AIL PHARMA C Y • MA Y 2020
By John Simpson.
Principal
Clinch Long Woodbridge
Lawyers
John Simpson
is a Principal at Clinch Long
Woodbridge Lawyers, a Sydney-based law
firm with a focus on pharmacy. John and his
colleague Peter Clinch have assisted many
pharmacists with a broad range of issues
affecting their business.
Inquiries:
jsimpson@clw.com.au or
02 9279 4888.
WHEN RETAIL LEASES GO WRONG
I
t’s an unfortunate reality that many
people who enter into a lease may
find themselves in a dispute during
the life of that lease.
Pharmacy leases are regulated by
the Retail Leases Act 1994 (NSW),
which sets out a compulsory dispute
resolution process to which both
lessees and lessors must adhere.
When dealing with disputes of this
nature, many people’s first instinct is
to go to court so they can be granted
an enforceable decision. However,
a number of other processes must
be carried out before litigation will
be permitted.
Negotiation
The first step involved in any retail
lease dispute is to attempt good-faith
negotiations. Although negotiation is not
prescribed under the act, it’s a natural
(and important) first step in any dispute
of this nature.
While disputes can often become
emotionally charged, engaging in
“good-faith negotiations” means you put
emotions to the side and approach the
negotiation table with a real intention to
try and settle the matter.
Settling your matter early and amicably
is the best way to resolve your dispute,
as avoiding a drawn-out dispute will
likely save you time, effort and money.
This is why the negotiation step is such
an important one.
Mediation
If negotiation is unsuccessful, the next
step in the process is mediation.
Mediation involves a meeting with
the other party, facilitated by a neutral
third party (the mediator). While having
no ability to make a binding decision,
or to compel you to resolve the issue,
the mediator will attempt to guide
you and the other party to a mutually
agreeable solution.
In the event of a retail lease dispute,
you’re required to arrange mediation
with the Office of the NSW Small
Business Commissioner.
In the event that the mediation is
unsuccessful, the Commissioner
will issue you with a certificate
under section 68 of the act, stating
that mediation was attempted and
was unable to resolve the dispute.
You’ll need this certificate to commence
proceedings at the NSW Civil and
Administrative Tribunal (NCAT).
NCAT
After an unsuccessful mediation, retail
lease disputes are usually dealt with at
NCAT rather than in a more traditional
court. If you do commence proceedings
in a court, the matter will generally be
transferred to NCAT unless the court
finds that the “interests of justice”
require them to deal with the matter.
NCAT is able to deal with retail tenancy
claims and unconscionable conduct
claims up to a value of $750,000
where the lease was signed on or after
July 1 2017. If the lease was signed before
this, the limit will be $400,000.
To make such a claim, you’re required
to lodge your application within three
years of the liability arising. If this three-
year period has lapsed, you may still be
able to make an application for a further
three-year period, although you’ll first
have to be granted approval for an
extension of time.
The wrap-up
If you’re faced with a retail lease dispute,
you’ll be required to undertake several
dispute resolution strategies before
commencing proceedings. While it’s
easy to think of these as simply steps
on the road to NCAT, it’s important to
remember that both negotiation and
mediation have been proven to be very
effective methods of dispute resolution.
If you have any questions, or require
assistance with a retail lease dispute,
please get in contact with our business
law team.
A roadmap to handling retail lease disputes in NSW