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Boarding House Woes

Discussion in 'Commercial Property' started by OldElliottE, 24th Jul, 2015.

  1. OldElliottE

    OldElliottE Member

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    24th Jul, 2015
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    NSW
    Hey Gang

    Some of you already know me from SS. Anyway one of my leases for a boarding house is a mess right now. We have a retail lease which I told the owners I didn't think appropriate for a boarding house anyway but now we are in the process of ending it. Council inspected and referred back to the DA and realised that our granny flat was never approved as accommodation and should always have been just a "staff lounge room" despite having a full kitchen and bathroom. Owners have now decided it's all too much hard work and want to end the use of the house as a boarding house.

    We are trying to negotiate a reduction in our rent due to the loss of the studio part of our boarding house while we also negotiate when we will end the lease and move everything out of the rest of the property. Owners are not playing ball.

    I'm sure I had read somewhere that if someone was found to be earning money off an unapproved granny flat or illegal house division etc then the tenant can apply for all the rent paid to be returned. Is this correct or my imagination? Where would I find this info. Might not apply I guess with this silly retail lease but for the five previous years we paid rent we were on a residential lease.
     
  2. thatbum

    thatbum Well-Known Member

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    Its unlikely because its not generally correct law, but I have heard of a case or two like it.
     
  3. Pistonbroke

    Pistonbroke Well-Known Member

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    Could only apply under a residential lease. As this is a commercial arrangement there would be a provision shifting risk for suitability/fit for porpoise onto the tenant.

    I couldn't fathom why they would use a retail lease other than for its structure a commercial lease would suffice. Did the lessor register the bond or was it a bank guarantee?
     
  4. thatbum

    thatbum Well-Known Member

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    I'm not sure what you mean? I don't think that's right.
     
  5. Pistonbroke

    Pistonbroke Well-Known Member

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    I have heard of the tribunal member (residential leases) overturning/voiding the lease and require the lessor to refund the tenant but can't recall the situation.

    As this isn't a residential lease but the supply of commercial residential premises the oft and residential tribunal won't apply to the lessee however may apply to the occupant of studio if they fell under the RTA.