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Section 52 of the Retail Leases Act 2003 implies into a “retail premises” lease an obligation on landlords to maintain “in a condition consistent with the condition of the premises when the retail premises lease was entered into” things such as the “structure of, and fixtures in” the premises, “plant and equipment at retail premises” and “the appliances, fittings and fixtures provided under the lease by the landlord relating to the gas, electricity, water drainage or other services”.
When is the lease entered into if an option is exercised? Is it the date when the lease commenced or when the new lease arising by reason of the option being exercised commences?
In Ross-Hunt Pty Ltd v Cianjan Pty Ltd the Tribunal held that that the relevant date was the date that the new term commenced following the exercise of an option and not the commencing date of the first term of the lease.
A further question then arose about whether a provision in a lease that imposes a higher standard on a landlord than that imposed by s.52 is void under s.94 on the ground that it is contrary to or inconsistent with s.52.
In Savers INC (ARB 075 452 185) v Herosy Nominees[the Tribunal held that if parties wished to contract for more than was provided for under s.52 they were free to do so; in that case the leases (and earlier leases to which the landlords and tenant were parties) contained terms that obliged the landlords to undertake repairs to the premises and imposed obligations that were more onerous than those imposed by s.52.
In the recent decision of Di & Li Australia Pty Ltd v Jin Dun Pty Ltd Senior Member Riegler rejected an argument that lease provisions which imposed more onerous obligations on the landlord than those imposed by s.52 were void. The Senior Member said:
“ In my view, s 52 does not prohibit the parties from agreeing to extend the Landlord’s obligations to repair or maintain its installations. The situation might be different if s 52 was expressed as a provision limiting a landlord’s obligation to maintain plant and equipment to a condition consistent with its condition when the lease was entered into. However, the provision does not expressly limit a landlord’s obligations but rather, imposes what I consider to be a minimum obligation on a landlord.
 There is nothing inconsistent or contrary to s 52 for the parties to increase that obligation and in the present case, it made eminent sense for the Landlord to continue to have that obligation upon renewal, given that it held the reversionary interest in the plant and equipment.
Further, it is not the case that s 52 is devoid of any limitation. In particular, sub-section (3) sets out various circumstances which limit its operation.
Those circumstances do not include limiting the comparator to the commencement of the Lease.
In my opinion, it was open for Parliament to have limited the operation of s 52(2) of the Act to the current term by stating words to the effect that a lease is not to include a term which requires the landlord to maintain plant and equipment, other than in a condition commensurate with the condition of the plant and equipment at the commencement of the lease.
However, the section is not expressed in such prohibitory terms, nor is it expressed to indicate any intention on the part of the legislature to ‘cover the field’ in respect of a landlord’s repair liability.”
  VCAT 829.
2011] VCAT 1160
  VCAT 349
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Section 52 of the Retail Leases Act 2003 implies into a lease a term that the “landlord is responsible for maintaining in a condition consistent with the condition of the premises when the retail premises lease was entered into:
“(a) the structure of, and fixtures in, the retail premises; and
(b) plant and equipment at the retail premises; and
(c) the appliances, fittings and fixtures provided under the lease by the landlord relating to the gas, electricity, water, drainage or other services.
The section was considered in Computers & Parts Land Pty Ltd  VCAT 2054 where it was held that a landlord was not required to maintain premises in “state of disrepair” that was “identical” to the state of disrepair when the lease was entered into; the state of repair “need not be any better than at the commencement of the lease” but had to be “the same benefit to the lessee as was agreed to be provided by the demise” (para ). Section 52 was a “keep in repair” obligation as opposed to a “put in and keep in repair” obligation (paras  and ). The expression “keep in repair”:
“…could mean, in extreme circumstances, that the only course open to a landlord is to replace some aspect of rented premises, but only to the degree that it is necessary to give the tenant the same conditions as at the commencement of the tenancy.”
If parts failed they had to be replaced with replacement parts that “in the absence of adequate second hand parts, might need to be new” (para ). While s 52 did not mandate compliance with any legislative standard, a landlord could not contravene “a building or related law or regulation” and if there were an “aspect of the building that was legal at the date of its construction but is no longer legal, repair of that aspect of the building would not be a betterment for the Tenant.”(para ).
The Tribunal rejected contentions that a landlord had to re-design an air conditioning system to remove design flaws or anomalies (para ) and replace the system with one that operated better than the original system (para ) but accepted that there might be circumstances where a roof had to be replaced rather than repaired if it were to survive the duration of the tenancy (para ).
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