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Lease Disclosure Statements

Prior to signing a Retail Business contract, Lease Disclosure Statements are required.

Below is the key detail provided by Kafrouni Lawyers here


New Retail Shop Lease Requirement – Business Sales

From tomorrow, 25 November 2015, a seller of a business, connected to a Queensland retail shop lease, has new pre-contract disclosure requirements.

What is required?

The seller must provide the buyer with a copy of the current lease and the assignor disclosure statement, at least 7 days before entering into a business sale agreement. This is pursuant to the Retail Shop Leases Amendment Act 2016.

Can this notice period be shortened?

This 7 day period may be shortened if, by the day prior to the contract date (i.e. contract date minus one day), the buyer:

  1. receives a copy of the lease and the assignor disclosure statement;
  2. gives the seller:
  • a “waiver notice” stating that the buyer agrees to waive the seller’s obligation;
  • has received, from a lawyer, advice about the legal meaning and effect of the waiver.

The requirement for legal advice does not apply to “major lessees” i.e. where the prospective buyer has 5 or more retail shops in Australia.

What are the consequences of non-compliance?

A failure to comply causes a retail tenancy dispute to exist between the buyer and the seller and, up to within 2 months after the assignment, a party may apply to QCAT for an order that the disclosure take place. So, to be clear, it does not invalidate the business sale contract.

The result may appear inconsequential. However, the practical consequences of a failure are serious. As you know, no door should be left open for a dispute in the process of selling a business; and a seller should not be starting the process on the wrong foot.

Where to get the “waiver notice”?

As yet, the Queensland Government has not issued a prescribed “waiver notice” form on its website. Therefore, we have drafted a “waiver notice” that we think complies with the new Act and it is available here: Waiver Notice. If interested, you will also find a summary of the other new changes affecting retail shop leases in Queensland.


What do you need to do?

If you are buying or selling a retail shop, please do not hesitate to contact us if you have any queries on your obligations under the new law, or if you require help with the buy or sell process.

Joe Kafrouni, Director, Kafrouni Lawyers


The information provided by Kafrouni Lawyers is intended to provide general information and is not legal advice or a substitute for it. Business people should always consult their own legal advisors to discuss their particular circumstances. Kafrouni Lawyers makes no warranties or representations regarding the information and exclude any liability which may arise as a result of the use of this information. This information is the copyright of Kafrouni Lawyers.

Liability limited by a scheme approved under professional standards legislation.