My sales have slumped and I’m concerned we may not make the next rent payment when it’s due. What will happen if we are in default?
Lawyer Answers (1): Answers from lawyers are general preliminary responses. They are not formal legal advice and cannot taken account of all your circumstances. They do not create a lawyer–client relationship.
Answer by Robert Bailey, Adelaide 5000 SA
- Breaches such as not operating your business within the hours specified under the lease or undertaking works without your landlord’s consent are capable of being fixed. Non-payment of rent or outgoings in accordance with the lease is generally treated more seriously than other types of breaches.
- Read your lease to see if it sets out any procedure to be followed in the event that you default.
- You should seek legal further advice to clarify and confirm what your lease says about defaults particularly if your landlord can issue you with a breach notice. A single default can still have consequences years later.
- If you are having financial difficulties try speaking to your landlord first before you default to negotiate an alternative payment arrangement.