Below are some frequently asked questions regarding security bonds, section 19 of the Retail Commercial Leases Act 1995 (the Act).
Some leases may require you to pay a cash security bond, which must be held by the South Australian Small Business Commissioner.
Most (but not all) commercial leases in South Australia are subject to the Act.
Leases to which the Act applies are described in the Act as retail shop leases. Your premises do not have to be “retail” or a “shop” to be a retail shop lease or subject to the Act.
A retail shop lease includes any business premises which are used (even to a small extent) for the sale of goods to the public by retail, or the provision of services to the public, or are business premises to which the public is invited to negotiate for the supply of services.
Accordingly, your lease may still be subject to the Act even if your premises are used for more than one purpose or if your premises include an office, a restaurant or cafe, a showroom or display yard, professional rooms or include other “non-retail” type premises. It is your use of the premises that determines whether or not your lease is subject to the Act.
A security bond cannot exceed the equivalent of three months’ rent (exclusive of GST). If a lease provides rent concessions, such as a rent-free period or a period of rent at concessional rates, the concession will be disregarded.
The rental threshold amount and the amount of a security bond are both exclusive of GST.
This security bond amount must be lodged with the Office of the South Australian Small Business Commissioner within seven (7) days of receipt of moneys by the landlord.
If the party receiving the security bond is a registered agent—within 28 days.
Bond forms are submitted to the SASBC via email or post. A 'retail and commercial lodgement of security bond' form can be downloaded from the forms page.
Payment must be made by direct debit.
When the tenancy/lease has ended, a claim for a refund can be made for of the bond.
A lessee or lessor/agent can make a claim against a bond by completing a 'bond refund form', downloadable from the forms page.
A bond will only be disbursed when both parties have given consent, however if the Commissioner receives a completed form from one party, the Commissioner will inform the other party by written notice and allow 14 days to provide a response. If no written notice of dispute is received the bond will be refunded.
Receipt of a dispute will be referred to the Magistrates Court to determine the matter.
Forms required to lodge or request a refund can be found on the forms page.
If you are unable to find an SASBC notification e-mail sent to you as part of a lodgement or refund, check your junk mail and mark the sender as safe, otherwise contact the office via firstname.lastname@example.org. or telephone toll free 1800 072 722.
If both parties have not completed and signed the refund form, the SASBC will send a notice of claim form (dispute application) to the other party. The form must be returned to the SASBC within the nominated time frame (14 days) before the security bond it paid out under subsection (5) of the Act.
If the refund is disputed, the SASBC will create a dispute file and will be referred to the Magistrates Court to resolve the dispute. The SASBC case management team will contact both parties to advise that a dispute has been referred to the Magistrates Court.
If one lessee on the bond can be contacted, the SASBC will accept a signed declaration authority (which is located on the back of the Retail and Commercial Security Bond Refund form (link)) authorising the release of the bond to the nominated tenant.
This authorisation must be signed when it is submitted to the SASBC.