Retail Leases Act 1994 No 46
Current version for 1 January 2014 to date (accessed 20 December 2014 at 02:12)
Part 2A

Part 2A Security bonds

Division 1 Preliminary

16A   Definitions

(1)  In this Part:

approved form means a form approved by the Director-General.

authorised officer means:

(a)  the Director-General, or
(b)  a person appointed by the Director-General to be an authorised officer:
(i)  for the purposes of this Part generally, or
(ii)  for the purposes of a particular provision of this Part in which the expression is used.

money includes a cheque.

prescribed proceedings means:

(a)  proceedings in a court (other than a prosecution) or before the Tribunal in relation to any matter which, under the terms or conditions of a lease, could, but for this Part, have given rise to a claim in relation to a security bond deposited or paid in accordance with those terms or conditions, or
(b)  mediation of a retail tenancy dispute concerning such a claim.

security bond, in relation to a lease or proposed lease, means an amount of money that:

(a)  was (before or after the lease became, or the proposed lease becomes, binding on the parties) deposited with or paid to:
(i)  the lessor, or
(ii)  another person, in accordance with the directions of the lessor or the terms or conditions of the lease or proposed lease, or
(iii)  another person acting on behalf of the lessor, and
(b)  was so deposited or paid in such a way that the effect is to secure, otherwise than by payment of rent in advance, the lessor against any failure by a lessee to comply with any terms or conditions (irrespective of whether those terms or conditions are related to payment of rent or not) applying to or in connection with the lease or proposed lease.

(2)  An amount of money deposited with or paid to a person as referred to in paragraph (a) (ii) or (iii) of the definition of security bond in subsection (1) in respect of a lease is, for the purposes of section 16C, taken to be deposited with or paid to the lessor under that lease.
(3)  For the purposes of the definition of security bond in subsection (1), where:
(a)  money is deposited or paid as referred to in that definition in relation to a proposed lease, and
(b)  a lease between the parties, and of the premises, to which the proposal relates is entered into,
the lease entered into is taken to be the lease proposed at the time the money is deposited or paid, whether or not the lease entered into differs from the lease proposed at that time.

16B   Guarantees and other forms of security

(1)  A retail shop lease is taken to include a provision to the effect that the lessor is not entitled to unreasonably refuse to accept a guarantee from an authorised deposit-taking institution in satisfaction of any requirement to provide a security bond or other bond or a third party guarantee for the performance of the lessee’s obligations under the lease.
(2)  Security provided otherwise than in the form of a security bond is not otherwise subject to the requirements of this Part.

Division 2 Deposit of security bonds with Director-General

16C   Deposit of security bonds with Director-General

(1)  This section applies where a lessor receives a security bond for a lease or a proposed lease on or after the commencement of this section.
(2)  The lessor must deposit with the Director-General an amount of money equivalent to the amount of the security bond not later than 20 business days (or, where some other period is prescribed for the purposes of this subsection, that other period) after:
(a)  the date of receipt of the security bond, or
(b)  the date on which the lease became, or the proposed lease becomes, binding on the parties,
whichever is the later.
(3)  If a lessor’s agent receives on behalf of the lessor a security bond for a lease or proposed lease, subsection (2) extends to require the agent to deposit with the Director-General an amount of money equivalent to the amount of that security bond and so extends as if a reference in that subsection to a lessor were a reference to the agent.
(4)  The Director-General may, without affecting the obligation imposed on a lessor or lessor’s agent under this section, refuse to accept any amount tendered for deposit under subsection (2) that is not accompanied by a notification in or to the effect of the approved form duly completed.
(5)  If a security bond that is (pursuant to section 82) exempt from the operation of subsection (2) subsequently ceases to be exempt, this section applies to the bond as if it had been received when it ceased to be exempt.
(6)  The Minister, by instrument in writing, may, in any particular case or class of cases, extend the period prescribed by or under subsection (2).
(7)  Subsection (2) has effect despite the terms of a lease, any rule of law or the provisions of any other Act.

16D   Deposit of existing security bonds with Director-General

(1)  This section applies in either of the following circumstances:
(a)  where, before the commencement of this section, a lessor under a lease or proposed lease received a deposit or payment of money that, if it had been received after that commencement, would have been a security bond,
(b)  where:
(i)  a lessor under a lease or proposed lease, to which this Act does not apply, received a deposit or payment of money as a security bond, and
(ii)  this Act afterwards becomes applicable to the lease because of the operation of section 6A or for any other cause.

For the purposes of this section, the relevant day is the date of commencement of this section (in circumstances to which paragraph (a) applies) or the day when this Act becomes applicable to the lease (in circumstances to which paragraph (b) applies).

(2)  The lessor, or the lessor’s agent, must deposit with the Director-General within 3 months after the relevant day an amount of money equivalent to the current balance of the amount deposited or paid.
(3)  The current balance is the amount of money deposited or paid, together with any interest or similar payments, and less:
(a)  any amount that:
(i)  has been deducted by way of fees or charges by an authorised deposit-taking institution, or
(ii)  has been refunded or become refundable, or
(iii)  has become the property of the lessor, or
(iv)  has become subject to prescribed proceedings, or
(v)  is payable to the lessee by way of interest earned,
before or during the period referred to in subsection (2), or
(b)  any amount of a kind prescribed by the regulations.
(4)  The Director-General may, without affecting the obligation imposed on a lessor under subsection (2), refuse to accept any amount tendered for deposit under that subsection that is not accompanied by a notification in or to the effect of the approved form duly completed.
(5)  If a security bond that is (pursuant to section 82) exempt from the operation of subsection (2), subsequently ceases to be exempt, section 16C applies to the bond as if it had been received when it ceased to be exempt, and this section ceases to apply to the bond.
(6)  The Minister, by instrument in writing, may, generally or in any particular case or class of cases, extend the period prescribed by subsection (2).
(7)  Subsection (2) has effect despite the terms of a lease, any rule of law or the provisions of any other Act.

16E   Provisions in leases relating to security bonds

(1)  No one (other than the Director-General) is, in respect of any period after the date that an amount of money equivalent to the amount of a security bond is deposited with the Director-General, entitled to receive interest in respect of the bond.
(2)  This section does not prevent the payment under section 16H or 16I of an amount equivalent to interest as referred to in section 16M.
(3)  If, but for this Part, a lessor or lessee would have a claim against a security bond under the terms and conditions of a lease for an amount that cannot be recovered under any other provision of those terms and conditions:
(a)  the lessor may recover from the lessee as a debt an amount equivalent to the amount of the claim that the lessor would have had against that security bond, and
(b)  the lessee may recover from the lessor as a debt an amount equivalent to the amount of the claim that the lessee would have had against that security bond.

Division 3 Payment out of security bonds

16F   Interpretation

In this Division, a reference to an amount of money, in relation to a lease, is a reference to an amount of money equivalent to the amount of money, or part of the amount of money, as the case may require, held on deposit by the Director-General in respect of that lease.

16G   Application for payment

(1)  An application to the Director-General to pay out an amount of money in respect of a lease may be made:
(a)  jointly by the lessor and the lessee, or
(b)  by the lessor alone, or
(c)  by the lessee alone.
(2)  An application is to be in or to the effect of the approved form and may:
(a)  in the case of an application of a kind referred to in section 16H (1)—be made at any time, or
(b)  in the case of an application of a kind referred to in section 16H (2) or (3)—be made on termination of the lease.
(3)  An application by the lessor alone and an application by the lessee alone may, at the discretion of the Director-General, be treated as having been made jointly by the lessor and the lessee, if the applications are substantially the same.

16H   Payment on application

(1) Payment on joint application or to other party
If an application under section 16G:
(a)  is made jointly by a lessor and a lessee under a lease, or
(b)  is made by a lessor under a lease who, in that application, directs the Director-General to pay out an amount of money to the lessee, or
(c)  is made by a lessee under a lease who, in that application, directs the Director-General to pay out an amount of money to the lessor,
the Director-General must pay out an amount of money as directed in that application.
(2) Notice to lessee of application by lessor for payment to lessor
If an application under section 16G is made by a lessor alone under a lease who, in that application, directs the Director-General to pay out an amount of money to the lessor, the Director-General must give notice in writing of the receipt of the application to the lessee.
(3) Notice to lessor of application by lessee for payment to lessee
If an application under section 16G is made by a lessee alone under a lease who, in that application, directs the Director-General to pay out an amount of money to the lessee, the Director-General must give notice in writing of the receipt of the application to the lessor.
(4) Payment to applicant lessor
If a lessee to whom notice has been given under subsection (2):
(a)  does not, within 14 days (or, where some other period is prescribed for the purposes of this subsection, that period) after service on the lessee of the notice or the date of posting of the notice, as the case may be, notify the Director-General in writing that the lessee has commenced prescribed proceedings in relation to an amount of money referred to in the notice, or
(b)  does so notify the Director-General, but those proceedings are discontinued,
the Director-General must pay out that amount to the lessor.
(5) Payment to applicant lessee
If a lessor to whom notice has been given under subsection (3):
(a)  does not, within 14 days (or, where some other period is prescribed for the purposes of this subsection, that period) after service on the lessor of the notice or the date of posting of the notice, as the case may be, notify the Director-General in writing that the lessor has commenced prescribed proceedings in relation to an amount of money referred to in the notice, or
(b)  does so notify the Director-General, but those proceedings are discontinued,
the Director-General must pay out that amount to the lessee.
(6) Payment of balance to other party
If an application referred to in subsection (2) or (3) is made in respect of part of an amount of money held on deposit by the Director-General in respect of a lease, the Director-General must pay out to the other party to the lease the remainder of the amount.
(7) Conflicting applications
If conflicting applications are received, the Director-General may disregard the later or latest application received.
(8) Notice: exceptions
Without limiting subsection (7), the regulations may provide that the Director-General need not give notice under subsection (2) or (3) in such circumstances as may be prescribed.
(9) Extension of period in particular cases
The Director-General may in any particular case extend the period prescribed by or under subsection (4) or (5).

16I   Payment after prescribed proceedings

(1)  If a lessor or lessee under a lease has, within the period prescribed by or under section 16H (4) or (5), commenced prescribed proceedings in relation to the lease and judgment in the proceedings has been entered in or given by a court or a court or the Tribunal has made an order in those proceedings for the payment of money:
(a)  the Director-General must:
(i)  on being served with or obtaining a copy of that judgment or order, and
(ii)  on being satisfied that the judgment or order has not been satisfied and no steps to enforce the judgment or order have been taken under any other Act,
pay out an amount of money held by the Director-General on deposit in respect of the lease, as if the Director-General were the person obliged to pay under the judgment or order, or
(b)  where the Director-General is satisfied that:
(i)  the judgment has been entered or given, or the order made, and
(ii)  that judgment or order has been satisfied (other than as provided in paragraph (a)),
the Director-General must pay out that amount of money to the person obliged to pay under the judgment or order.
(2)  If mediation of a retail tenancy dispute about a security bond has been successful and a certificate has been issued under section 16N (3) setting out the terms of the agreement, the Director-General must, on being served with or obtaining a copy of the certificate, pay out in conformity with the agreement an amount of money held by the Director-General on deposit in respect of the lease concerned.
(3)  For all purposes, money paid out by the Director-General under subsection (1) is taken to be money paid by the person against whom the judgment was obtained or the order was made.

16J   Excess not payable

(1)  This section applies where, in respect of a lease, the Director-General would, but for this section, be required to pay out an amount of money and that amount of money is in excess of the amount of money held on deposit by the Director-General in respect of the lease.
(2)  The Director-General:
(a)  must refuse to pay out the money, and
(b)  must treat applications for payment out of the money as having been withdrawn, and
(c)  must inform the applicants accordingly.
(3)  This section has effect despite any other provision of this Part.

16K   Appeal rights

(1)  The Director-General may, not earlier than 14 days after receiving notice of a judgment or order relating to a security bond, pay out money in respect of the judgment or order even if there is a right of appeal against the judgment or order, but only if an appeal has not been lodged.
(2)  If an appeal has been lodged, the Director-General must not pay out money in respect of the judgment or order unless satisfied that the appeal has been withdrawn or dismissed.
(3)  A payment of money by the Director-General in respect of a judgment or order does not prevent an appeal being lodged.

16L   Withdrawal of application

If prescribed proceedings have not been commenced in relation to an amount of money held by the Director-General within the period prescribed by or under section 16H (4) or (5):
(a)  a lessor or a lessee may, at any time before a payment is made in accordance with an application made by the lessor or lessee, withdraw the application, and
(b)  for the purposes of this section, the application is thereupon taken never to have been made.

16M   Payment out of amount equivalent to interest

(1)  This section applies to amounts paid out by the Director-General under section 16H or 16I in respect of security bonds lodged with the Director-General.
(2)  The total amount available to be paid out in respect of a security bond is to include an amount equivalent to interest at the rate prescribed by the regulations for the time being:
(a)  calculated on the minimum monthly balances from time to time of the security bond held by the Director-General, and
(b)  compounded as prescribed by the regulations.
(3)  For the purposes of subsection (2) (a), minimum monthly balance means the minimum balance during any complete named month during which money in respect of a security bond is held by the Director-General.
Note. Clause 23 of Schedule 3 provides that, until regulations are made for the purposes of section 16M (2), regulations are taken to include provisions referred to in that clause.

16N   Miscellaneous provisions

(1)  If the Director-General is required to pay out an amount of money to a person under this Part, the Director-General may, instead of paying out the money to that person, pay out or apply the money in accordance with that person’s directions.
(2)  For the purposes of this Act, a court or the Tribunal is authorised to issue:
(a)  a copy of any entry of a judgment or a copy of an order, in each case certified by the proper officer to be a true copy of the entry or order, and
(b)  where proceedings have been discontinued, a certificate to that effect signed by the proper officer.
(3)  If a mediation of a retail tenancy dispute about a security bond is successful, the mediator or the Registrar may issue a certificate setting out the resulting agreement.
Note. The certificate may be used for the purposes of section 16I.
(4)  No claim other than a claim provided in this Part lies against the Director-General in respect of security bonds deposited with the Director-General.
(5)  This Part applies notwithstanding the terms of any agreement, any rule of law or the provisions of any other Act.

Division 4 Enforcement provisions

16O   Receipts to be given for security bonds

(1)  A lessor, or the lessor’s agent, receiving money deposited or paid as a security bond must, at the time of receiving the money, give or cause to be given to the person making the deposit or payment a receipt for the money.
(2)  A receipt given under subsection (1) must contain the following particulars:
(a)  the names of the lessor and lessee,
(b)  a sufficient identification of the retail shop concerned,
(c)  the amount of money received,
(d)  the date the money was received,
(e)  such other particulars as are prescribed for the purposes of this subsection.
(3)  A lessor, or the lessor’s agent, must keep or cause to be kept, in the manner (if any) and for such term (if any) as are prescribed, a copy of each receipt given under this section.
Note. Clause 24 of Schedule 3 provides that, until regulations are made for the purposes of section 16O (3), regulations are taken to include a provision referred to in that clause.

16P   Penalty notices

(1)  An authorised officer may serve a penalty notice on a person if:
(a)  it appears to the officer that the person has committed an offence against this Part or regulations made for the purposes of this Part, and
(b)  the regulations prescribe the offence as being one for which a penalty notice may be issued.
(2)  A penalty notice is a notice to the effect that, if the person served does not wish to have the matter determined by a court, the person may pay, within the time and to the person specified in the notice, the penalty prescribed by the regulations for the offence if dealt with under this section.
(3)  A penalty notice may be served personally or by post.
(4)  If the amount of the penalty prescribed for an alleged offence is paid under this section, no person is liable to any further proceedings for the alleged offence.
(5)  Payment under this section is not an admission of liability for the purposes of, and does not affect or prejudice, any civil claim, action or proceeding arising out of the same occurrence.
(6)  The regulations may:
(a)  prescribe an offence for the purposes of this section by specifying the offence or by referring to the provision creating the offence, and
(b)  prescribe the amount of penalty for an offence if dealt with under this section, and
(c)  prescribe different amounts of penalty for different offences or classes of offences.
(7)  The amount of penalty prescribed under this section for an offence may not exceed the maximum amount of penalty that could be imposed for the offence by a court.
(8)  This section does not limit the operation of any other provision of, or made under, this or any other Act relating to proceedings that may be taken in respect of offences.

16Q   Offences and penalty

(1)  Any person who contravenes, whether by act or omission, any provision of this Part is guilty of an offence against this Act.
(2)  Any person who is guilty of an offence under this Part is, on conviction, liable to a penalty not exceeding 20 penalty units.
(3)  This section does not apply to the Director-General or a person acting for or on behalf of the Director-General.

16R   Offences by corporations

(1)  If a corporation contravenes any provision of this Part or regulations made for the purposes of this Part, each person who is a director of the corporation or who is concerned in the management of the corporation is taken to have contravened the same provision if the person knowingly authorised or permitted the contravention.
(2)  A person may be proceeded against and convicted under a provision pursuant to subsection (1) whether or not the corporation has been proceeded against or been convicted under that provision.
(3)  Nothing in this section affects any liability imposed on a corporation for an offence committed by the corporation against this Act or the regulations.
(4)  This section does not apply to a person in the person’s capacity as a director of, or as a person concerned in the management of, a corporation constituted by or under an Act.

16S   Time for commencing proceedings for offences

Despite anything in any Act, proceedings for an offence against this Part or regulations made for the purposes of this Part may be brought:
(a)  in the case of an offence in relation to a security bond for a lease or a proposed lease—at any time before the expiration of the period of 3 years that next succeeds:
(i)  the commission of the offence, or
(ii)  the termination of the lease,
whichever is the later, or
(b)  in any other case—at any time before the expiration of the period of 3 years that next succeeds the commission of the offence.

Division 5 Accounts

16T   Accounts

The following accounts are to be established in accordance with law:
(a)  a Retail Leases Security Bonds Trust Account (referred to in this Division as the Trust Account),
(b)  a Retail Leases Security Bonds Interest Account (referred to in this Division as the Interest Account).

16U   Retail Leases Security Bonds Trust Account

(1)  There is to be paid into the Trust Account all security bonds deposited with the Director-General in accordance with Division 2.
(2)  There is payable from the Trust Account:
(a)  security bonds authorised to be paid out under section 16H or 16I, and
(b)  any other payments authorised by or under this or any other Act to be made from that account.

16V   Retail Leases Security Bonds Interest Account

(1)  There is to be paid into the Interest Account all interest received on investments of money in the Trust Account.
(2)  There is payable from the Interest Account:
(a)  the costs of, or the expenses incurred in, the administration of this Act, and
(b)  any other payments authorised by or under this or any other Act to be made from that account.
(3)  There is payable from the Interest Account such contributions as are agreed annually by the Minister and the Treasurer for payment to the Consolidated Fund.
(4)  Contributions referred to in subsection (3) are to be paid in the manner determined by the Treasurer.
(5)  There may be paid from the Interest Account all amounts payable because of the operation of section 16M.

16W   Agents of Director-General

(1)  Any money received, invested or paid out by an agent of the Director-General for the purposes of this Part is taken to have been received, invested or paid out, as the case may be, by the Director-General.
(2)  Any money received by an agent of the Director-General for the purposes of this Part is taken to have been received by the Director-General on the day that it is received by the agent.

Division 6 General

16X   Exemptions

(1)  For the purposes of, but without affecting the generality of, section 82, a class of security bond may be described by reference to a class of lease or a class of premises in respect of which security bonds are deposited or paid.
(2)  For the purposes of, but without affecting the generality of, subsection (1), a class of lease may be described by reference to periods of continuous occupancy of premises under leases or by reference to terms or conditions of leases.

16Y   Continuous occupation

For the purposes of this Part and regulations made in connection with security bonds, where the same lessee continuously occupies the same retail shop under a series of leases from the same lessor, those leases are taken to be one lease.

16Z   Annual report

The annual report of the Department of State and Regional Development is to include a report of the security bond scheme under this Part.

16ZA   Service of notices and other documents on Director-General

(1)  Any notice, summons, writ or other proceeding relating to or connected with this Part to be served on the Director-General may be served:
(a)  by being left, or
(b)  in the case of a notice, by posting it addressed to the Director-General,
at the office of the Director-General.
(2)  A letter giving a notice in writing to a lessor or lessee by post under Division 3 is taken to be properly addressed if it is addressed to that lessor or lessee at his or her last known address according to the records of the Director-General.
(3)  This section does not affect the generality of section 81A.

16ZB   Recovery of money

Any charge, fee or money due to the Director-General in connection with this Part may be recovered as a debt or liquidated demand in a court of competent jurisdiction.

16ZC   Regulations

(1)  The regulations may make provision for or with respect to the scheme provided by this Part, including (without limiting the foregoing) the manner in which money is to be deposited with or paid by the Director-General.
(2)  Without affecting the generality of section 85, wherever a provision of this Part requires a form to be prescribed or a document to be in writing, the regulations may prescribe:
(a)  a form to be used for that purpose, and
(b)  where that form or document is required to be lodged with or served on or sent to any person—the manner of lodgment, service or sending, and
(c)  particulars or information to be provided by a person completing that form or document.
(3)  Regulations made for the purposes of this Part may create offences punishable by a penalty not exceeding 3 penalty units.
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