What you need to know about the emergency changes to tenancy laws – COVID-19 Legislation Amendment (Emergency Measures) Act 2020 (NSW)
By Lindsay Sheather & Johnny Kong• 07 April 2020 • 3 min read
Significant changes to leasing practice in New South Wales have been made by the commencement of the COVID-19 Legislation Amendment (Emergency Measures) Act 2020 (NSW) (the Act) on 25 March 2020. The changes are effectively immediately.
What are the changes?
The Act allows the Minister to recommend regulations amending legislation governing retail leases (for example, leases of supermarkets, pharmacies, news stands) as well as residential tenancies (specifically, tenancies in respect of residential premises). In particular, the Act allows regulations to be made in order to:
- prohibit landlords from re-entering the premises in particular circumstances (meaning a landlord cannot evict a tenant in particular circumstances)
- prohibit landlords from terminating a lease or tenancy in particular circumstances (meaning a landlord cannot terminate a lease in particular circumstances)
- regulate or prevent the exercise or enforcement of any other rights of a landlord relating to the premises pursuant to certain acts or an agreement in particular circumstances (meaning a landlord cannot exercise certain rights given in a lease or other legislation, for example, claiming compensation)
- exempting a tenant, or a class of tenants, from the operation of a provision of an act or any agreement relating to the leasing or licensing of premises or land (meaning the Parliament can give concessions to certain groups of tenants).
Which kind of leases and tenancies will be affected?
The Act will affect the following types of leases:
- retail leases under the ambit of the Retail Leases Act 1994 (NSW)
- residential tenancy agreements under the ambit of the Residential Tenancies Act 2010 (NSW)
- farm leases under the ambit of the Agricultural Tenancies Act 1990 (NSW)
- occupancy agreements under the ambit of the Boarding Houses Act 2012 (NSW)
- site agreements under the ambit of the Residential (Land Lease) Communities Act 2013
- any other legislation relating to the leasing of premises or land for residential or commercial purposes
Will office leases be affected?
The Act specifically amends ‘any other legislation relating to the leasing of premises or land for commercial purposes’, which indicates that it will apply in part to commercial leases, and may make amendments to the Conveyancing Act 1919 (NSW) which affect commercial leases.
The proposed amendments are not yet known.
What are the particular circumstances and the actual impacts?
The Act has not defined what the particular circumstances are, and these will constitute those measures which the Minister considers to be necessary for responding to the pandemic as are prescribed by the regulations.
It is likely that the regulations will, amongst other things, temporarily:
- prohibit landlords from evicting tenants due to non-payment of rent (including outgoings, GST and other contributions)
- restrict landlords from calling on bond money, such as cash security bonds and bank guarantees
- prohibit landlords from charging penalty interest on late payments of rent.
Maddocks has produced guides to a range of legal issues raised by the coronavirus (COVID-19). You can access these guides here.
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