A landlord communicating to a tenant a termination of a lease
must be clear. This is evident from the decision in Dee-Tech
Pty Ltd v Neddam Holdings Pty Ltd  NSWCA.
THE TERMS PROVIDE FOR THE RIGHT
A lease will generally provide for the circumstances where a
landlord is entitled to exercise its contractual right to terminate
a lease. The relevant termination may be by re-entry or notice of
breach to the tenant of an essential term.
Except in the case of non payment of rent, the landlord must
comply with the provisions of section 129 of the Conveyancing
Act 1919 (NSW) in order for the termination to be
In order for a notice of termination of a lease to be valid, the
notice must make a clear demand for possession. This means that the
notice to terminate a lease must include an unequivocal act or
statement that the landlord is treating the lease as at an end.
The Dee-Tech case demonstrates a bad example of a
notice to terminate.
In the Dee-Tech case, the agent for the landlord served
on the tenant what was unsuccessfully argued as an effective notice
to terminate the lease.
The right for the landlord to terminate the lease arose because
the tenant did not maintain the relevant insurances under the lease
and maintenance of insurance by the tenant was an essential term of
the lease. A breach of this term of the lease meant that the
landlord could terminate the lease subject to the observance of
The notice headed "Notice to vacate the premises" in
the Dee-Tech case included, amongst other things, that:
"You are in breach of your lease and we have been
instructed to terminate this current lease... You are requested to
vacate the premises".
The Court of Appeal held that the notice was
not an unequivocal statement to terminate the
the heading failed to describe that the notice was a
termination of breach of an essential term;
the notice did not state that the lease was terminated;
the notice did not state that the lease would be terminated at
a certain time in the future; and
the notice did not contain any demand for immediate possession
of the premises.
In essence, the notice did not contain any demand at all that
the tenant yield up possession of the premises. It simply confirmed
If the intention of a landlord is to terminate a lease, the
lease should be terminated effectively with clear and direct
Alternatively, a tenant should not take a notice to terminate
given by the landlord on face value and should consider whether the
notice actually serves the purpose for which it was given.
In the Dee-Tech case, in the end, because the lease was
not validly terminated unbeknown to the landlord, in the same and
small window of opportunity, the tenant effectively exercised its
option for a further term and the relationship between the landlord
and the tenant continued.
Many retail leases include a covenant to trade, requiring the tenant to open the premises for trade during certain hours.
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