Covid-19 lockdown and lease disputes

On 25 March 2020 the Government declared a civil emergency and enforced a Level 4 lockdown. Aside from the unprecedented social impact, shockwaves reverberated throughout businesses operating in New Zealand.

If you owned/operated a business at a leased premise before the lockdown, then almost certainly you have acquired rights when it comes to the payment of rent during the lockdown period.

The standard form Auckland District Law Society lease document (6th edition, 2012) has special provisions relating to “No Access in Emergency”. These were incorporated as a response to the Christchurch Earthquakes and fall out from the Red Zones created following those catastrophes. Put simply, a qualifying lessee will be entitled to withhold a “fair proportion of the rent and outgoings”. Other standard form leases have similar provisions which may be engaged by the circumstances of the lockdown.

On the flipside, if you were the landlord of commercial premises during the lockdown then you will need to carefully consider your approach to the enforcement of rent payments.

Grimshaw & Co is able to provide tailored advice to your situation, after considering the applicable lease documents, and your particular lessor-lessee relationship. We are able to think outside the box to offer a strategy suited to your individual circumstances. This may simply involve an exchange of correspondence, or more formal measures such as mediation, expert determination or quick form arbitration.

Get in touch if you would like to speak to one of our experienced lawyers today.