The 7-day disclosure period in QLD

The 7-day disclosure period in QLD is the minimum time a lessor must allow between giving a prospective lessee the lessor disclosure statement and the proposed lease, and the lease being entered into. Under section 21B of the Retail Shop Leases Act 1994 (Qld), the lessor must give both documents at least 7 days before the lease is entered into. The period gives the lessee time to read the documents and get legal and financial advice.

What the lessor must give

Two documents, together:

• The lessor disclosure statement, on the approved Form 7 under the Act, available from the Queensland Small Business Commissioner (QSBC).
• A copy of the proposed lease, in the terms the lessee is being asked to sign.

The disclosure statement sets out the key facts about the lease and the premises. It usually covers:

• the rent and how it will be reviewed
• an estimate of the outgoings the lessee will pay
• the lessor’s works and any works the lessee must do
• the term, options and any incentives
• details of the shopping centre, if the shop is in one
• any known matters that may affect the lessee’s trading

The lessor is responsible for the accuracy of the statement, even if an agent prepares it.

How the 7 days works

The rule is “at least 7 days before the lease is entered into”. In practice:

Keep a record of the date the documents were given, such as the email they were sent with. If you’re close to the line, allow an extra day rather than argue about the count later.

The 7 days is a minimum, not a deadline. A lessee can take longer, and many do while terms are negotiated. See Form 11 vs Form 12 for the two advice reports, which are usually done in this period.

What happens if the period is missed

If the lessor doesn’t give the disclosure statement at least 7 days before the lease is entered into, the lessee can end the lease by written notice within 6 months after entering it (section 21F). The Act allows a late statement to be cured if the lessee gives a waiver notice before signing, backed by legal advice, so check whether that happened.

The same applies if the statement is materially false, misleading or incomplete. For a wrong statement, the right doesn’t apply if the lessor acted honestly and reasonably and the lessee is in substantially as good a position as if the statement had been right. The lessee may also be able to claim compensation for loss caused by a wrong statement.

These rights depend on the facts. A lessee who wants to rely on them should get advice before giving any notice.

Leasing a retail shop as lessor? We prepare the lessor disclosure statement so it can go out with the lease. Lessor disclosure statements.

Why lessors should give the statement early

A late or wrong disclosure statement can cause problems, and the risk sits with the lessor. If the lessee can end the lease months after moving in, the lessor may be left with empty premises and the cost of re-letting.

Giving the statement early, with the final lease terms, avoids most of this. If the terms change during negotiations, update the statement so it matches the lease that is signed.

Disclosure on renewals and assignments

Disclosure isn’t only for new leases. The Act also deals with disclosure when a lease is renewed or extended, and when a lessee assigns the lease to a buyer of the business. The documents and timing differ in each case, so check the rules for your situation before relying on the 7-day period.

How Queensland compares

Each state with a retail leases Act sets its own disclosure period, and they aren’t all the same. Victoria, for example, has a longer period. See the 14-day disclosure period in Victoria if you also lease premises there.