Licensing salon rooms is not a retail business: shop lease dispute dismissed for want of jurisdiction (QCAT, 2026)

What happened

The tenant leased premises in Newstead, a suburb of Brisbane. Its business was to license the use of individual salon rooms to freelancers, who used those rooms to provide hair, beauty and allied health services as their own businesses. That was the use of the premises set out in clause 7.1 of the lease document.

A dispute arose between the tenant and the landlord over whether land tax should be included in the outgoings the landlord charged the tenant. The tenant said the lease was a retail shop lease, which would mean the land tax could not be passed on. The landlord said the lease was not covered by the Retail Shop Leases Act 1994 (Qld), so the land tax was payable. The tribunal recorded that there was also a dispute about rent abatement and rubbish removal.

Acting on its view that the lease was a retail shop lease, the tenant lodged an application for mediation with the Queensland Small Business Commissioner. That is the dispute resolution step set out in Part 8 of the Act. Mediation did not resolve the dispute, so the mediator referred it to the tribunal.

It was not disputed that the building containing the premises was not a retail shopping centre. In February 2026 the tribunal ordered both sides to file written submissions on whether it had power to deal with the matter at all. Those submissions came in during March 2026. The tribunal apologised to the parties for the delay in dealing with the matter after that, which it attributed to its overstretched resources. The matter was heard and decided on the papers, meaning on the documents alone without a hearing, under section 32 of the Queensland Civil and Administrative Tribunal Act 2009 (Qld).

What each side wanted

The tenant argued that the premises were used wholly or predominantly to carry on a retail business as described in the Retail Shop Leases Regulation 2016 (Qld), so the premises were a retail shop under section 5B of the Act, the lease was a retail shop lease under section 5A, and the dispute was a retail tenancy dispute the tribunal could decide under section 103. It said all of the floor area was used to provide retail services or to support them, that the test in section 5B looks at how the premises are used and not at whether the tenant itself or its licensees deliver the services, and that the definition of retail business focuses on the nature of the services rather than the contracts behind them. The landlord argued the opposite: that section 5B asks what business the tenant itself carries on, and the tenant's own business was licensing salon suites to independent operators, which is a space-licensing business and not one of the businesses listed in the Regulation. On the landlord's case, the tenant did not itself provide hair, beauty or allied health services to the public, so the lease was not a retail shop lease and the tribunal had no power to hear the dispute.

What the tribunal decided

The tribunal ordered that the proceeding be dismissed for want of jurisdiction. "Want of jurisdiction" means the tribunal has no legal power to decide that type of dispute.

No money was ordered to be paid either way, and the tribunal did not decide whether land tax was in fact payable. The tribunal noted it made the order effectively under section 47(1)(a) of the Queensland Civil and Administrative Tribunal Act 2009 (Qld), on the basis that the proceeding was misconceived.

Why the tribunal decided it that way

The tribunal's power to hear a retail tenancy dispute comes from section 103 of the Retail Shop Leases Act. A retail tenancy dispute is a dispute under or about a retail shop lease, and a retail shop lease is a lease of a retail shop. Under section 5B a retail shop is premises either in a retail shopping centre or used wholly or predominantly for carrying on a retail business, and under section 5C a retail business is one prescribed by the Regulation, with the list set out in Schedule 1. Because the building was accepted not to be a retail shopping centre, everything turned on whether a retail business was being carried on at the premises.

The tribunal accepted there was no doubt that retail businesses were being conducted from the premises. Those were the businesses of the freelancers who had licences to use parts of the space. But the tribunal did not accept that this made the lease a retail shop lease. It held that section 5B must be read as asking about the business carried on by the tenant itself, not the business of a third party to whom the tenant licenses space. On the evidence, the tenant carried on no retail business: its business was licensing the use of spaces within the premises to freelance operators and providing them with what the tribunal described, at best, as support services.

The tribunal reached that reading by looking at the Act and the Regulation as a whole. The Act describes a retail shop lease as the lease of a retail shop, not the lease of a space to be used as a retail shop. It also pointed to the object of the Act in section 3, to promote efficiency and equity in the conduct of certain retail businesses in Queensland, and to the explanatory notes for the Bill, which spoke of a framework for the advantage of direct participants in the retail industry. The reference to direct participants put the emphasis on the parties to the lease and the business for which the lease exists, not on third parties. The relevant business is therefore the one that is the subject of the lease, usually found in the lease's own "use of premises" clause.

The tribunal added that Parliament had expressly listed the business activities that count as retail businesses, and licensing space to other operators who might run a retail business is not one of them. Had Parliament intended that, it could readily have said so. The tribunal noted the landlord's reliance on section 5A(2)(c), which excludes a lease of premises used wholly or predominantly for a business carried on by an employee or agent of the lessor, but said that provision did not itself answer the question. The conclusion was that the tenant's business of licensing spaces was not a retail business, regardless of what the operators did, so the lease was not a retail shop lease and the tribunal had no power to decide the dispute.

What this means if you are in a similar position

This decision shows that the label on a dispute does not decide where it can be heard. Before a Queensland tribunal can deal with a shop lease dispute under the Retail Shop Leases Act, the premises have to be a retail shop, and if the building is not a retail shopping centre that depends on the business the tenant itself carries on being one of the businesses listed in the Regulation. If you are in a similar position, the decision shows the tribunal will look at the "use of premises" clause in the lease and at what the tenant actually does, rather than at the activities of subtenants, licensees or other operators who occupy the space.

It also shows that the threshold question gets decided first, and that mediation through the Queensland Small Business Commissioner and payment of a tribunal fee do not settle it. The referral of a dispute to the tribunal after mediation does not prove the tribunal has power to hear it. Here the tribunal directed both sides to file submissions on jurisdiction before anything else, and the substantive arguments about land tax, rent abatement and rubbish removal were never decided.

In a disagreement over outgoings, rent or repairs under a commercial or retail lease, the step most people take first is a written notice to the other side setting out the dispute and asking for it to be resolved, including any mediation step the lease or the legislation requires, and only after that an application to the tribunal or court that has power to hear that kind of dispute.

How to apply: our step-by-step guide to a QCAT application. More decisions: QCAT cases and other civil disputes.

Source: Freedom Suits Australia Pty Ltd v Newstead Central Holdings Pty Ltd [2026] QCAT 466 (read the full decision). This summary was prepared from the published decision for general information. It is not legal advice, and the tribunal’s own reasons are the authoritative record.