What happens if a tenant renews a retail premises lease when the Act no longer applies?

This question has vexed the leasing community for some time, and has recently been addressed (in part at least) by a VCAT decision that was published in the last week or so.

There are, by and large, two questions:

1. Does the Retail Leases Act 2003 (Vic) continue to apply to the lease if, say, the tenant becomes a listed company or the lease was assigned during its term to a listed company?
2. If the Act does not apply, do the amendments to the lease that were caused by the RLA 2003 still carry through to the renewed term?

Both questions have now been addressed by VCAT in the recent decision of Tiba Kebab Pty Ltd v G8 Education Limited (Building and Property) [2025] VCAT 987, a copy of which is not yet available on AustLii, but can be accessed here.

I refer readers to two excellent blog posts by my friend and fellow-blogger Robert Hay KC that discuss in detail the background to these questions and the recent VCAT decision that are available here and here.

The upshot of the decision is:

1. the RLA 2003 does not apply to a lease if one of the statutory exceptions applied when the lease was renewed. In that particular case, a lease of retail premises to which the Act applied was assigned during its term to a listed company. The new listed tenant then exercised two options for further terms. The Tribunal held that the RLA 2003 does not apply to the renewed terms; and
2. because of the way the lease deed was drafted, the terms of the renewed lease being considered by the Tribunal were not affected by the RLA 2003. The lease that was under consideration appears to be a version of the LIV copyright lease, but it is unclear which version was being used. The covenant had one version of its rent review provisions that applied if the Act applied to the lease and another version that applied if the Act did not. As a result, nothing in the lease was rendered void by the RLA 2003 when it applied and the lease on renewal was unaffected by the RLA 2003.

It is important that the answer to the second question depended on the drafting of the particular covenant being considered in that case. The answer may have been different if the lease covenants do not allow for the RLA 2003 applying or not applying at different times.