NSW's 2022 COVID-19 leasing laws have again been modified and will now continue until 30 June 2022. The amendments give landlords greater control over their premises by being able to increase rent and, in some circumstances, to terminate impacted lessees' tenancies.
Effective today, the key changes include:
- the prescribed period is extended until 30 June 2022
- there will be fewer impacted lessees because the required 2020-2021 turnover, to qualify as an impacted lessee, cannot exceed $5 million. It used to be $50 million
- landlords can increase rent. This is not expressly limited to rent only owed after 14 March 2022, but leases usually require rent in advance, meaning practically this will only apply to prospective rent
- for prescribed breaches after 13 March 2022, including not paying rent, renegotiation is no longer needed before a landlord terminates or takes any other 'prescribed action'. All a tenant can do is remedy the breach or hope the issue resolves in mediation. If not, and a mediation fails, the landlord remains able to terminate
- when courts and tribunals deal with post-13 March 2022 terminations of impacted lessees, they no longer need to consider the National Code of Conduct
- renegotiations commenced but not concluded before the expiry of the prescribed period (now 30 June 2022) can no longer be continued after the expiry.
The above changes open possibilities, especially for landlords looking to recover possession. Subject to the mediation requirement, landlords could rely only on a tenant's breaches after 13 March 2022, even if the tenant had pre-March 2022 breaches. Also, the benefit of non-concluded rent-relief negotiations will be lost after 30 June 2022 and this will be a further leverage point for landlords. In other words, tenants should seek to strike relief agreements before 30 June 2022.
For a background of these laws, read our past articles on COVID-19 leasing law changes in NSW and 2022's new NSW COVID-19 leasing laws.
This publication does not deal with every important topic or change in law and is not intended to be relied upon as a substitute for legal or other advice that may be relevant to the reader's specific circumstances. If you have found this publication of interest and would like to know more or wish to obtain legal advice relevant to your circumstances please contact one of the named individuals listed.