Relief from defaults in commercial leases

The COVID-19 Emergency Response Act 2020 affects commercial and residential tenancies. Section 7 in relation to commercial tenancies provides that if “a lessee is suffering financial hardship as a result of the COVID 19 pandemic”, the landlord cannot take any prescribed action on account of failure to pay rent, outgoings or failure to open for business. Compliance with the laws of the State cannot be a breach of a lease. A party can apply to the Small Business Commissioner for mediation or determination whether the lessee is suffering financial hardship. A determination is appellable to the Magistrates Court (s 7(8)–(9)). A lessor is constrained from taking enforcement actions and an order can be obtained from the Magistrates Court to enforce that constraint (s 7(12)–(13)). Similar provisions are in place for residential tenancies (s 8).
Regulations under the act provide that a lessee will be taken to be suffering financial hardship as a result of the COVID-19 pandemic if the lessee is eligible for, or is receiving, a JobKeeper payment in respect of the business (whether in their capacity as an employer or on their own behalf).