Tenant & Landlord Obligations for Essential Safety Measures Maintenance

In Victoria, the Retail Leases Amendment Act 2020 clarifies the entitlement of landlords to recover from tenants the costs of installation, repair and maintenance of essential safety measures (ESMs).

In Victoria there is an obligation for the owner of a building or place of public entertainment to maintain the essential safety measures.  An essential safety measure are those passive and active safety features required in a building, structure or place of public entertainment to protect and safeguard the occupants in the event of a fire or other emergency.

According to the Retail Leases Amendment Act (Vic) 2020 (the Act), from October 1, 2020 a landlord (in certain circumstances) under a retail lease can pass on the costs of repairing and maintaining essential safety measures and the costs of installing essential safety measures as part of a fit-out to a tenant as outgoings.

The Victorian Civil and Administrative Tribunal ("VCAT") have also provided an advisory opinion providing further guidance to all stakeholders on the application and payment of costs associated with the provision or maintenance of essential safety measures.

These changes apply to new and existing leases, however, the landlord cannot recover ESM costs incurred before the commencement of the Amendment Act.

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