What happens if I sign a retail lease in Western Australia without a disclosure statement?

Nikolina Milošević
3 hours ago
5 min read

If you sign a retail lease in Western Australia without receiving a disclosure statement from the landlord, you may have significant rights under the Commercial Tenancy (Retail Shops) Agreements Act 1985 (WA), including the right to terminate the lease in certain circumstances and claim compensation. A disclosure statement is not optional. It is a legal requirement, and failure to provide one, or providing a misleading one, has real consequences for the landlord.

Many Perth small business owners do not know a disclosure statement exists, let alone that they should have received one. If you run a salon, clinic, fitness studio, café, florist, or any other retail business from leased premises in WA, this matters to you.

As a small business owner, it's easy to forget about legal risks, but they could result in a huge problem in the future. Click here to read about other overlooked legal risks.

What is a disclosure statement?

A disclosure statement is a formal document that the landlord must give to the tenant before the tenant enters into a retail lease in Western Australia. It sets out the key commercial terms of the lease in a standardised format, so the tenant can clearly see what they are agreeing to before signing.

The disclosure statement covers matters such as the premises, the term of the lease, the rent and how it is reviewed, an estimate of outgoings the tenant will be required to pay, any incentives or contributions offered by the landlord, the permitted use of the premises, and any works the landlord is required to complete.

The purpose of the disclosure statement is to make sure tenants enter retail leases with full knowledge of the commercial terms and financial commitments involved. It is one of the key tenant protections under WA retail leasing law.

When is a disclosure statement required?

A disclosure statement is required before a tenant enters into a retail lease in Western Australia. A retail lease under the Commercial Tenancy (Retail Shops) Agreements Act 1985 (WA) is broadly a lease of premises used wholly or predominantly for the retail sale of goods or services, or for specified retail businesses.

This captures many small businesses that people do not immediately think of as retail, including salons, fitness studios, allied health clinics, cafés, florists, and similar service businesses operating from leased premises open to the public.

If your business falls into this category and you have signed a lease in WA, the retail leasing legislation likely applies to you, and the landlord was required to give you a disclosure statement.

Not sure if your lease is a retail lease or whether you received a valid disclosure statement? Book a call with us to find out:

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What happens if the landlord does not give you a disclosure statement?

If the landlord fails to provide a disclosure statement before the tenant enters the lease, the tenant has specific rights under the Act. The most significant is the right to terminate the lease in certain circumstances within a defined period, even though the lease has been signed.

This right is not unlimited. There are time frames that apply, and the tenant must take action promptly once they become aware of the failure. But the right to terminate is a powerful remedy, particularly for tenants who have signed a lease on terms they would not have accepted had they received the full disclosure.

The tenant may also have rights to claim compensation for losses suffered as a result of the landlord's failure to disclose, particularly where the tenant has relied on assumptions about the financial commitments of the lease that turn out to be inaccurate.

What happens if the disclosure statement is misleading or incomplete?

A disclosure statement that is provided but is misleading, inaccurate, or incomplete can also give rise to tenant rights. If the outgoings estimate understates the actual outgoings, if the permitted use is described inaccurately, or if material matters are omitted, the tenant may be entitled to compensation for losses caused by the misleading information.

This is particularly relevant where a tenant has committed to a lease based on an estimated outgoings figure, and the actual outgoings turn out to be significantly higher.

The interaction with the lease itself

A disclosure statement does not replace the lease. It sits alongside the lease as a summary of the commercial terms. But if there is inconsistency between the disclosure statement and the lease, or between the disclosure statement and what the tenant actually experiences during the lease, the disclosure statement becomes central to the tenant's legal position.

Tenants should always keep a copy of the disclosure statement they received, along with a copy of the signed lease. If there is ever a dispute, the disclosure statement is often the first document examined.

What to do if you did not receive a disclosure statement

If you are a WA retail tenant and you do not remember receiving a disclosure statement, or you received something informal that did not look like a proper disclosure document, get legal advice promptly. The rights under the Act are time sensitive, and delay can reduce your options.

The first step is to confirm whether your lease is in fact a retail lease under the WA legislation, because the disclosure requirements only apply to retail leases. The second is to review what was provided to you before signing and assess whether it meets the disclosure requirements. The third is to understand what remedies are available based on the specific circumstances.

If you think you did not receive a proper disclosure statement, book a Strategy & Advice Consult with us.

Why this matters for Perth small business owners

Perth has a large number of small businesses operating from retail premises across the metropolitan area, from Mandurah to Joondalup and everywhere in between. Many of these businesses are run by owners who signed their lease quickly, without legal advice, and without any understanding of the retail leasing legislation that applies to them.

The protections under the WA retail leasing legislation exist for a reason. Landlords are professionally represented. Leases are drafted in the landlord's favour. The disclosure requirements are one of the few legal counterweights available to retail tenants, and tenants should use them.

The bottom line

If you signed a retail lease in Western Australia without a disclosure statement, you may have rights, including the right to terminate the lease and claim compensation, depending on the circumstances. These rights are time sensitive and fact specific, which means legal advice early is important.

If you are about to sign a retail lease in WA, demand the disclosure statement first. Read it carefully. Compare it to the lease. If anything does not line up, get advice before signing anything.

Get your lease reviewed

If you are signing a retail lease in WA, or you have concerns about a retail lease you have already signed, book a call with us to review it: