New South Wales Consolidated Acts

CONVEYANCING ACT 1919 - SECT 133E

133E Breach of certain obligations not to preclude option except in certain circumstances

(1) This section applies to a lease that contains--

(a) an option exercisable by the lessee, and

(b) provision by which the lessee's entitlement to the option is made to depend on performance by the lessee of any specified obligation, whether such performance is required before, or after, or before and after, the giving of any notice by which the option is exercised.

(2) Despite any provision of the kind referred to in subsection (1)(b), no breach by the lessee of any relevant obligation precludes the lessee's entitlement to the option unless--

(a) the prescribed notice has been served on the lessee in respect of the breach, and

(b) the lessee's rights are extinguished in relation to the notice.

(3) In subsection (2)--

"breach" of an obligation includes, where the obligation requires any thing to be done, any neglect or failure to do the thing concerned.

"obligation" includes any agreement, covenant, condition or stipulation by which the lessee is required to do or refrain from doing any thing.

"prescribed notice" means a notice in writing--

(a) specifying the lessee's breach of the relevant obligation and served on the lessee--

(i) within 14 days after the giving of a notice by which the option is exercised, if the breach occurred before the giving of that notice, or

(ii) within 14 days after the breach, if the breach occurred after the giving of that notice, and

(b) states that, subject to any order of the court under section 133F, the lessor proposes to treat the breach as precluding the lessee from entitlement to the option.

(4) For the purposes of subsection (2)(b), the lessee's rights are extinguished in relation to a prescribed notice--

(a) if an order for relief against the effect of the breach in relation to the lessee's entitlement to the option is not sought from the court within one month after service of the prescribed notice, or

(b) if proceedings in which such relief is sought are disposed of, in so far as they relate to that relief, otherwise than by granting relief, or

(c) if such relief is granted on terms to be complied with by the lessee before compliance by the lessor with the order granting relief, and the lessee fails to comply with those terms within the time stipulated by the court for the purpose.