Options in leases often require that a tenant notify the landlord they wish to remain in the property within a certain period of time, but in the recent case of Tripple A Pty Ltd v WIN Television Qld Pty Ltd [2018] the court was asked to examine what occurs when an option is purportedly exercised after this time period has expired.

In this case, the tenants had not given notice of their intention to take up the option within the required time period, but instead began talks with the landlord a week after its expiry. When a dispute arose about the price of rent, the tenant argued that the landlord had waived the option period requirement by engaging in correspondence about the option and the rent payable despite the fact that the option had expired. The Court of Appeal rejected this argument, and found that the correspondence in fact meant a new lease agreement had been entered into which should reflect the current market rent, rather than being informally exercised as an extension of the old lease with the same rent.

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