How does a tenant obtain relief against forfeiture of its lease? (Part 1)

  • Author : Bill Stark - 20-10-2011

The classic decision in Victoria on this issue was made by Ormiston J in Jam Factory P/L v Sunny Paradise P/L [1989] VR 584. Ormiston J concluded that where a tenant undertakes to pay arrears of rent and to perform any other covenants which were breached, relief against the tenant's forfeiture of the lease should be granted as a matter of course, and refused only in exceptional circumstances. A failure to pay rent does not constitute an exceptional circumstance unless there are consistently lengthy defaults, leading to an inference that the rent will not be paid in the future.

In December 2010, I appeared for a tenant who sought relief against forfeiture in a retail leasing dispute in the Supreme Court (see V&O Princi P/L v Prestige Holdings Group P/L [2010] VSC 627).

The case was unusual because it was not dealt with by VCAT (see my earlier blog about VCAT's exclusive jurisdiction over retail leasing disputes). I have written a paper about that decision, which is available on the Greens List web site: under library, cpd papers, property law, Seminar on Property Law presented by Russell Cocks.

The case stands as further proof of the fact that it is very difficult for a landlord to oppose an application by a tenant for relief against forfeiture successfully.

About the Author

Bill Stark

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