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Lease Incentive claw backs – Can they be enforced?

A decision of the Victorian Civil and Administrative Tribunal (VCAT) late last year has raised great uncertainty for landlords in Australia in their ability to claw black fit out costs and other incentives from tenants.

In its reasoning, VCAT applied an earlier decision of the Queensland Supreme Court which was previously thought to be an anomaly and unique to the facts of that case. The tribunal’s decision however, creates serious doubt on the ability to negotiate claw back clauses with tenants.

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