Need HELP HELP HELP

I'm new to Australia, so have no any experience in business and lease contract.

Last November I bought a convenience shop in Adelaide, and my neighbor shop is a lunch bar. so there states "not to carry on activities that compete with the coffee shop within the same group of shops" on my lease contract.
First I didn't care these matters, because I thought the landlord restricted me and also restricted other shops as well. And on my contract from my previous owner there states "the lessor agreed not to allow other shops in the centre to sell supermarket grocery items & vegetables"

But after I took over the shop, I found the lunch bar can sell everything, kinds of milk ,iced coffee, drinks, ice cream, confectionaries, snacks and so on. Every item with high-profits sold in my shop also can sold in the lunch bar.

we are in a small shopping centre, all customers shopping here want to save time and convenience. For example, a customer goes to our shopping centre to have a lunch. The lunch bar sells both hot food and drinks, but I'm not allowed to sell hot food. The customer will not specifically come to my shop to buy drinks, because the lunch bar sells drinks as well.

I discussed with my landlord but he said there is no provision in my lease for me to impose conditions on other businesses in the shopping centre. The comments restricting other shops were written on the lease, by previous owner, not landlord, are not binding and have no effect.

Later, I found the landlord and the owner of the lunch bar are old friends.I consulted The Eastside BEC Team, responsible for managing small business. The stuff sent a member of South Australian Lease Management to my shop. He looked at my lease contract, said no problem, the reason is that I agreed with the contract.

The lease contract was signed by my previous owner, I only read the contract from him, I don't konw it's different from landlord's. And I also thought the conveyancer should have the responsibility to check my contract,but not.Because of my poor english, it's much harder to me to deal with the issues.

But I still think it is unfair that the landlord only restricts me, don't restrict other shops. In the whole, are all the acts are legal? Is there no fair competition in Australia?

Now it is very difficult to me to run the store, so only the extension of trading hours. Unsafe at night, last month, the store was robbed. I need help, who can give me viable suggestions, how can I do? Thanks a lot.

Added:

My convenience store opened first, with 20 years of history, the lunch bar opened 3 years ago .When the previous owner renewed the lease contract, the landlord required to add restrictions terms into the contract. At that time Australia's good economic development, the previous owner did not care. But now the poor economy, the retail downturn, such a unfair terms, my convenience store is even more difficult.

I am not saying of the lunch bar can not sell those things, I only ask for fair, we can be fair competition.

In some countries, limit the scope of business of the stores within the same shopping center is very common, but mutual, not just limit one shop. Such terms of the contract is invalid, because it is not fair. Not all mutually agreed contracts are legal, the contract clearly contrary to the principle of fairness is not valid.The tenant can ask the court to cancel or modify the contract. The landlord should compensate the loss of tenant.

I just want to know this case is whether legal in Australia, in the case of legal, it is as a lesson.I just want to understand this point.
 
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You agreed to it but now saying it is unfair??

Sounds like a costly mistake. What did your lawyer say about it when your purchased?
 
Sorry for your situation, seems stressful.
Maybe the landlord was shopping for visa applicants?
I've heard many businesses are being fixed for inflated sales prices to overseas purchasors looking to "buy "a PR visa.
 
You agreed to it but now saying it is unfair??

Sounds like a costly mistake. What did your lawyer say about it when your purchased?


The lease contract was signed by my previous owner, I only read the contract from him, I don't konw it's different from landlord's. And I also thought the conveyancer should have the responsibility to check my contract,but not.

Sounds like there was no lawyer involved in the sale.
 
I didn't know before the member of South Australian Lease Management told me.

May be the cause of the cultural differences.
 
I dont think its reasonable to say that a lunch bar cant sell drinks, ice-cream, milk etc. Most lunch bars would sell those items.
Our local store has several take away stores, plus a bakery, plus a convenience store. If I'm buying from the bakery, that is where I would buy my milk. If I'm buying veges, then I'll buy my milk from the convenience store.

I think you need to stop worrying about what other people are doing and get to work on making your store appealing and give people a reason to come in there. Maybe have some specialty items (asian or italian groceries etc). our local convenience store seems to do well with flowers and he has a table where people can wrap them well. maybe some gifts. he also has a licence to sell alcohol, so half the store is a bottle shop, and half the groceries.

work out what people need in emergency situations, and stock them.

it sounds like you didnt do much due diligence. So, you have probably paid more than you should and are not making as much money as you expected to. Dont focus on what other people are doing.... that wont make you a success. Do a business plan and get on with running your business. you should still be able to be successful, despite the other shop selling milk and icecream...
 
I dont think its reasonable to say that a lunch bar cant sell drinks, ice-cream, milk etc. Most lunch bars would sell those items.
Our local store has several take away stores, plus a bakery, plus a convenience store. If I'm buying from the bakery, that is where I would buy my milk. If I'm buying veges, then I'll buy my milk from the convenience store.

I think you need to stop worrying about what other people are doing and get to work on making your store appealing and give people a reason to come in there. Maybe have some specialty items (asian or italian groceries etc). our local convenience store seems to do well with flowers and he has a table where people can wrap them well. maybe some gifts. he also has a licence to sell alcohol, so half the store is a bottle shop, and half the groceries.

work out what people need in emergency situations, and stock them.

it sounds like you didnt do much due diligence. So, you have probably paid more than you should and are not making as much money as you expected to. Dont focus on what other people are doing.... that wont make you a success. Do a business plan and get on with running your business. you should still be able to be successful, despite the other shop selling milk and icecream...

In your opinion, most convenience store would sell hot pies,coffee,sandwich...I am not saying of the lunch bar can not sell those items, I only ask for fair, we can be fair competition.

In some countries, limit the scope of business of the stores within the same shopping center is very common, but mutual, not just limit one shop. Such terms of the contract is invalid, because it is not fair. Not all mutually agreed contracts are legal, the contract clearly contrary to the principle of fairness is not valid.The tenant can ask the court to cancel or modify the contract. The landlord should compensate the loss of tenant.

I just want to know this case is whether legal in Australia, whether my legal rights have been infringed. If not, it's OK, just as a lesson.I just want to understand this point.
 
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Australia is a highly contractual environment unlike some other countries. Here it depends on what is in your lease. However read it carefully as even those things may be open to interpretation. Does the lease say you cant sell milk ? If so can you sell ice cream as it is not milk. Maybe the lease says you cant sell anything that another store already sells. If so then you have problems. What is fair is irrelevant. What your contracts says is very relevant.

Have terryw reveiw it for you. He isnt the cheapest but he is good.
 
In your opinion, most convenience store would sell hot pies,coffee,sandwich...I am not saying of the lunch bar can not sell those items, I only ask for fair, we can be fair competition.

.

I dont think most convenience stores would sell hot food and coffees etc, not suburban ones anyway, except for 7-11 petrol stations.

But I would expect lunch bars to sell ice cream, soft drinks, milk and chocolates.

I just think you need to stop thinking about what is fair, and start working on getting your business profitable. There are plenty of things to sell which the lunch bar wont be doing... focus on those!

It sounds like you didnt think it was unfair until you found out that the lunch bar didnt have the same restrictions as you. So, focus on your business and what you had planned to do when you took over the shop..... make it the best you can with the products you can sell!
 
You are in a shopping centre. You have a retail lease. You took an assignment of the existing lease or a new lease based on the existing usage clause.

When purchasing a business it is critical to engage your experts: a lawyer to explain the legal aspects & a retail leasing advocate for the commerciality of the lease.

By cutting corners to trim off some of your purchase costs you have tied yourself into an unfavorable lease which is burning a hole in your pocket.
 
I think you need legal advice to sort out the interpretation of the terms of your lease and what you can and cannot do. For example, when the landlord say do not compete with the lunch business - what hours and what type? Subject to interpretation.

You have purchased a convenience store and supposed to carry on business with those things already stocked in the store. If new restriction applies on existing items in the store then the previous owner and landlord may have knowingly misled you and you have some grounds to get legal action. When was restriction imposed? When did you buy? Also, whether there may be Consumer statutes that may help you. These are some questions a legal person may explore and advise you.
 
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If the landlord has made you promises that the other stores in your shopping centre will not compete with you and has broken those promises then you can complain to your State fair trading department.
 
You are in a shopping centre. You have a retail lease. You took an assignment of the existing lease or a new lease based on the existing usage clause.

When purchasing a business it is critical to engage your experts: a lawyer to explain the legal aspects & a retail leasing advocate for the commerciality of the lease.

By cutting corners to trim off some of your purchase costs you have tied yourself into an unfavourable (situation)

^^^ This is my opinion also.

This is the end result of a lack of due diligence upfront on your part.



Such terms of the contract is invalid, because it is not fair. Not all mutually agreed contracts are legal, the contract clearly contrary to the principle of fairness is not valid.The tenant can ask the court to cancel or modify the contract. The landlord should compensate the loss of tenant.

^^^ This drives me nuts....
 
You are in a shopping centre. You have a retail lease. You took an assignment of the existing lease or a new lease based on the existing usage clause.

When purchasing a business it is critical to engage your experts: a lawyer to explain the legal aspects & a retail leasing advocate for the commerciality of the lease.

By cutting corners to trim off some of your purchase costs you have tied yourself into an unfavorable lease which is burning a hole in your pocket.

Totally agree.

It is quite the norm to have food retail tenants detail in full their menus into the lease.

If you did not take the opportunity of advising yourself of the situation then so be it. Why should a landlord or anyone else take responsibility for your stupidity?

Focus on your own business and if you cant, then sell up and learn from your mistakes.
 
If retail was simple , competed on equal standing in negotiations & honest , & all players fair, why would each state have an entire act of parliament devoted to retail leases? It says alot for residential leases as well.
 
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