VCAT confirms that the Retail Leases Act 2003 (Vic) must be reassessed each time a lease is renewed – key lessons from Tiba Kebab Pty Ltd v G8 Education Limited [2025] VCAT 987.
Why this matters
This decision is important for landlords and tenants of commercial and retail premises in Victoria, particularly where leases include multiple renewal options. It clarifies that the Retail Leases Act 2003 (Vic) (RLA) does not automatically continue to apply to renewed terms (even if the option to renew was contemplated at time the lease was entered into).
Background
Tiba Kebab Pty Ltd v G8 Education Limited [2025] VCAT 987 concerned whether the RLA continued to apply to a series of renewed lease terms when, at the date of renewal, the tenant was a listed corporation.
The landlord, Tiba Kebab Pty Ltd (Tiba), sought an order under section 37 of the RLA for the appointment of a valuer to determine market rent for the 2023-2028 term of the lease in question.
The Tribunal held that the RLA did not apply to the renewed lease and that the rent had been fixed under the lease’s contractual terms. Tiba’s claim was therefore dismissed as “misconceived and lacking in substance”. The reasoning extends principles from Richmond Football Club Pty Ltd v Verraty Pty Ltd [2019] VSC 597 (Verraty).
Facts
The original lease in question commenced in 2008 for five years with five further five-year options between Tiba and Samuel Whiskers Pty Ltd. In 2015, the lease was assigned to G8 Education Limited (G8), a listed corporation since 2007.
G8 exercised its renewal options in 2018 and 2023. Upon the 2023 renewal, G8 proposed a commencing rent in its notice to exercise. The lease required Tiba to object in writing to the proposed rent within 14 days ‘unless the RLA applies’, Tiba did not respond until two and a half months after receiving G8’s notice to exercise stating it did not agree with G8’s proposed rent, culminating in Tiba suggesting that a valuer was to be appointed in accordance with section 37 of the RLA.
Statutory framework and relevant lease provisions
Section 75 of the Victorian Civil and Administrative Tribunal Act 1998 (Vic) (VCAT Act) allows a dismissal of proceedings that are “frivolous, vexatious, misconceived or lacking in substance”.
Section 11 of the RLA applies to leases “entered into” or “renewed” after the commencement of the Act. Section 4(2)(c)(i) of the RLA excludes leases where the tenant is a listed corporation.
Clause 11 of the lease in question provided that if the RLA:
- does not apply, a proposed rent becomes binding unless objected to within 14 days; and
- applies, or if an objection is made but no agreement reached, a valuer determines market rent.
Tribunal’s analysis
The Tribunal confirmed that whether the RLA applies does not change during a term, per Verraty, but additionally held that each renewal is a new lease for the purpose of the RLA. Accordingly, because G8 was a listed corporation at the commencement of the 2018 renewal, the RLA did not apply to that term or the subsequent 2023 renewal.
Clause 11 was then also deemed valid and enforceable because it proposed a separate process depending on whether the RLA applied. As Tiba failed to object within 14 days, the rent to be paid by G8 was that which was proposed in its notice to exercise.
Key takeaways
- The RLA’s application must be reassessed at each lease renewal.
- If a tenant is a listed corporation at renewal, the renewed lease will not be a retail premises lease, even if earlier terms were covered by the RLA.
- Parties can validly plan for the possibility that the RLA will not apply in future terms.
- Strict compliance with contractual time limits is critical—Tiba’s failure to object within the prescribed 14 days meant that it was bound by the rent that was proposed by G8.
For further information
If you would like to discuss any of the above or to request a review of your lease renewal provisions, please contact Suzanne Rieschieck, Mark McKinley and Samantha Taylor.
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