Casual Mall leasing - a coordinated approach?

This article seeks to examine the nature of casual leasing, the issues which may cause contention between landlords and tenants, the present legal position regarding the practice and examines the possibility of more formalised regulation in the future.A relatively recent phenomenon in shopping centres is the encouragement of internal, and external, traders to become casual tenants in the common areas of shopping centres. Readers of this article will no doubt be familiar with traders operating in the mall areas of shopping centres, particularly during busy periods such as Christmas and Mother's Day. At first glance these activities may seem somewhat benign. Indeed, a visitor to the centre may be forgiven for thinking that the biggest problem associated with casual leasing is its effects on customer flow through areas assumed to be walkways. However, the legal position of landlords and tenants in relation to casual leasing is an interesting one. The practice raises contentious issues between landlords and tenants regarding disclosure, outgoings, access and competition. The issues have been discussed in State inquiries into retail leasing1 and legislation which has recently come into force in South Australia which regulates casual leasing practices.2 The Australian Retailers Association, the Shopping Centre Council of Australia3 and some major lessors4 have been proactive in drafting guidelines dealing with casual leasing. The prospect of a national code for casual leasing has been the subject of discussion between the Australian Retailers Association and the Shopping Centre Council of Australia and has recently been supported in principle by retail tenancy officials.