Lease Guarantee / Guarantor Agreement (Australia)
LEASE GUARANTEE AND GUARANTOR AGREEMENT
This Lease Guarantee and Guarantor Agreement ("Guarantee") is made on [Guarantee Date] in [State/Territory], Australia.
1. PARTIES
1.1 Landlord: [Landlord Name], of [Landlord Address] ("Landlord").
1.2 Tenant: [Tenant Name], of [Tenant Address] ("Tenant").
1.3 Guarantor: [Guarantor Name], of [Guarantor Address], email [Guarantor Email] ("Guarantor").
2. BACKGROUND
2.1 The Landlord and the Tenant have entered into, or are about to enter into, a [Lease Type] dated [Lease Date] for the premises situated at [Premises Address] ("Lease").
2.2 As a condition of the Landlord entering into the Lease, the Landlord has required the Guarantor to provide this Guarantee in respect of the Tenant's obligations under the Lease.
2.3 The Guarantor has agreed to provide this Guarantee in consideration of the Landlord entering into the Lease with the Tenant.
3. GUARANTEE
3.1 In consideration of the Landlord entering into the Lease with the Tenant, and for other good and valuable consideration (the receipt and sufficiency of which the Guarantor acknowledges), the Guarantor unconditionally and irrevocably guarantees to the Landlord the due and punctual performance of all of the Tenant's obligations under the Lease, including the payment of all rent, outgoings, GST, and other amounts payable by the Tenant under the Lease ("Guaranteed Obligations").
3.2 The Guarantor must, on demand by the Landlord, pay to the Landlord any amount that the Tenant fails to pay under the Lease when it falls due, and must perform or procure performance of any obligation that the Tenant fails to perform under the Lease.
3.3 This is a continuing guarantee and extends to cover all amounts and obligations under the Lease, including any variations, extensions, or modifications of the Lease agreed between the Landlord and the Tenant. The Guarantor consents in advance to any such variations, extensions, or modifications and acknowledges that they will not discharge the Guarantor from liability under this Guarantee.
3.4 The Guarantor's liability under this Guarantee is not affected by any time or indulgence granted by the Landlord to the Tenant, any failure by the Landlord to enforce the Lease or take action against the Tenant, the release of any co-guarantor, the bankruptcy or insolvency of the Tenant, or any other event that might otherwise discharge a guarantor at law.
3.5 The Guarantor acknowledges that the Landlord is not required to first proceed against the Tenant before making a demand under this Guarantee. The Guarantee is a primary obligation and the Landlord may demand payment from the Guarantor whether or not the Landlord has demanded payment from the Tenant or taken any other action to recover the amount owed.
4. DURATION OF GUARANTEE
4.1 This Guarantee continues [Guarantee Duration].
4.2 Notwithstanding the expiry of the Lease term, this Guarantee continues to apply to any liability of the Tenant that arose during the Lease term but remains unpaid or unperformed as at the date the Guarantee would otherwise expire.
4.3 The Guarantor remains liable under this Guarantee in respect of any holding over period during which the Tenant remains in occupation of the Premises after the expiry of the Lease, subject to any applicable cap under clause 5.
5. RIGHTS AND OBLIGATIONS OF GUARANTOR
5.1 Until all of the Tenant's obligations under the Lease have been fully performed, the Guarantor must not claim or exercise any right of subrogation, contribution, indemnity, or marshalling against the Tenant in relation to payments made by the Guarantor under this Guarantee.
5.2 The Guarantor must provide the Landlord with written notice of any change to the Guarantor's address within 7 days of the change occurring.
5.3 The Guarantor acknowledges that the Guarantor has had the opportunity to obtain independent legal advice in relation to this Guarantee before signing it and the nature and effect of this Guarantee has been explained to the Guarantor.
5.4 Where the Guarantor is an individual (not a company), the Guarantor acknowledges that the Landlord has advised the Guarantor to obtain independent legal and financial advice before executing this Guarantee.
6. NOTICES
6.1 Any notice or demand under this Guarantee must be in writing and may be served on the Guarantor by personal delivery, prepaid post, or email to the address set out in this Guarantee. A notice sent by post is deemed received 2 business days after posting. A notice sent by email is deemed received when transmitted, provided no delivery failure notification is received.
6.2 Landlord notices: [Landlord Address].
6.3 Guarantor notices: [Guarantor Address], email: [Guarantor Email].
7. GENERAL PROVISIONS
7.1 This Guarantee is governed by and construed in accordance with the laws of [State/Territory], Australia.
7.2 This Guarantee is binding on the Guarantor, the Guarantor's personal representatives, successors, and assigns.
7.3 If any provision of this Guarantee is void, voidable, unenforceable, or illegal, it is severed from this Guarantee without affecting the validity and enforceability of the remaining provisions.
7.4 This Guarantee may only be released, varied, or discharged by a written instrument signed by the Landlord.
7.5 A waiver by the Landlord of any breach of this Guarantee does not constitute a waiver of any other or subsequent breach.
7.6 This Guarantee may be executed in counterparts, each of which constitutes an original.
EXECUTION
This Lease Guarantee is executed by the parties on the date first written above.
GUARANTOR
[Guarantor Name]
Address: [Guarantor Address]
LANDLORD
[Landlord Name]
Address: [Landlord Address]
Guarantor
________________
Signature
Date: ________________
Landlord
________________
Signature
Date: ________________
What Is a Lease Guarantee / Guarantor Agreement (Australia)?
A Lease Guarantee / Guarantor Agreement in Australia grants a tenant the right to occupy residential premises and records the rent, bond, term, and the repair and notice obligations of landlord and tenant under the Real Property Act 1900 (NSW).
Under Australian law, a guarantee is classified as a secondary obligation — the guarantor's liability is dependent on the existence of the tenant's primary obligation under the lease. This means that if the lease is void or unenforceable, the guarantee may also fail. For this reason, most Australian commercial lease guarantees also include an indemnity, which is a separate primary obligation that remains enforceable even if the underlying lease is invalid or unenforceable.
Lease guarantees in Australia are governed primarily by contract law principles, with additional overlay from state and territory legislation. For retail leases, the applicable Retail Leases Acts (including the Retail Leases Act 1994 (NSW), the Retail Leases Act 2003 (VIC), the Retail Shop Leases Act 1994 (QLD), and equivalent legislation in other states) may impose limits on the types and amounts of security, including guarantees, that a landlord can require. Consumer protection legislation, including the Australian Consumer Law (Schedule 2 to the Competition and Consumer Act 2010 (Cth)) and state Fair Trading Acts, may also apply to guarantee arrangements, particularly where the guarantor is an individual consumer.
The most common type of lease guarantee in Australian commercial and retail leasing is a personal guarantee provided by the directors of a company tenant. Because a proprietary company has limited liability and its assets can be dissipated or the company deregistered, landlords require personal guarantees from the directors to confirm that there is a person with personal assets standing behind the company's lease obligations. It is standard practice for all directors of a company tenant to provide personal guarantees.
The legal framework governing the Lease Guarantee / Guarantor Agreement (Australia) in Australia draws on several key statutes and regulatory bodies. Under state and territory residential tenancies legislation, including the Residential Tenancies Act 1997 (Vic), Residential Tenancies Act 2010 (NSW), and equivalent Acts in other jurisdictions, tenancy tribunals (NCAT in NSW, VCAT in Victoria) adjudicate disputes. The Real Property Act 1900 (NSW) and Transfer of Land Act 1958 (Vic) govern property registration through state land registries. Section 52 of the Australian Consumer Law (Schedule 2, Competition and Consumer Act 2010) prohibits misleading conduct in property transactions. The Foreign Acquisitions and Takeovers Act 1975 (Cth) requires FIRB approval for foreign purchasers. Parties executing a Lease Guarantee / Guarantor Agreement (Australia) in Australia should confirm the document reflects current law, including any amendments enacted since the original drafting date. The Real Property Act 1900 (NSW) sets the foundational requirements.
When Do You Need a Lease Guarantee / Guarantor Agreement (Australia)?
A Lease Guarantee Agreement is needed whenever a landlord requires a third party to guarantee the tenant's obligations under a lease as a condition of entering into that lease. In Australian commercial and retail leasing, a personal guarantee from the directors of a company tenant is almost universally required.
You need a lease guarantee when entering into a commercial lease with a company tenant and the landlord requires the directors to provide personal guarantees of the company's lease obligations; when a residential landlord requires a parent, family member, or other creditworthy person to guarantee the obligations of a tenant who does not meet the landlord's income or credit requirements; when a retail lease is being entered into and the landlord requires additional security beyond the bank guarantee or cash bond; when a new business tenant with no trading history is taking a lease and the landlord requires the business owner's personal guarantee; and when a lease is being assigned from one tenant to another and the incoming tenant's directors are required to provide guarantees as a condition of the landlord's consent to the assignment.
For residential tenancies, a guarantor is sometimes sought when the tenant is a student, a young person starting their first rental, or a person returning from overseas with no local rental history. State residential tenancy legislation may impose restrictions on how landlords can enforce guarantees for residential tenancies, and both landlords and guarantors should be aware of the applicable legislation in their state.
Parties in Australia should prepare a Lease Guarantee / Guarantor Agreement (Australia) proactively rather than waiting for a dispute to arise. Courts interpret agreements based on the written terms rather than oral representations. Under state and territory residential tenancies legislation, including the Residential Tenancies Act 1997 (Vic), Residential Tenancies Act 2010 (NSW), and equivalent Acts in other jurisdictions, tenancy tribunals (NCAT in NSW, VCAT in Victoria) adjudicate disputes. The Real Property Act 1900 (NSW) and Transfer of Land Act 1958 (Vic) govern property registration through state land registries. Section 52 of the Australian Consumer Law (Schedule 2, Competition and Consumer Act 2010) prohibits misleading conduct in property transactions. The Foreign Acquisitions and Takeovers Act 1975 (Cth) requires FIRB approval for foreign purchasers. Where the transaction involves regulated activities, prior approval from the relevant authority may be required before execution.
What to Include in Your Lease Guarantee / Guarantor Agreement (Australia)
A well-drafted Lease Guarantee Agreement for Australian commercial, retail, or residential tenancies should address all of the following key elements.
Identification of parties: The guarantee must clearly identify the landlord, the tenant, and the guarantor. If the guarantor is an individual, their full legal name and residential address should be recorded. If the guarantor is a company, the company's ACN should be included. Where there are multiple guarantors (as is common where all directors of a company tenant are required to guarantee), each guarantor should be separately identified.
Identification of the lease: The guarantee must clearly identify the lease being guaranteed by reference to its date, the names of the landlord and tenant, and the address of the leased premises. If the lease is registered on title, the certificate of title reference should also be included.
Scope of guarantee: The guarantee should clearly state all of the tenant's obligations that are covered, including rent, outgoings, GST, make good obligations, and any other amounts payable under the lease. An 'all obligations' guarantee covers everything; a limited guarantee may cover only specified obligations.
Primary obligation: The guarantee should state that the guarantor's obligation is a primary obligation, allowing the landlord to demand payment from the guarantor without first being required to demand payment from the tenant or take action against the tenant.
Cap on liability: If the parties agree to limit the guarantor's total liability, the cap amount should be clearly specified. Where no cap is agreed, the guarantee should expressly state that the guarantor's liability is unlimited.
Duration: The guarantee should specify whether it covers the initial lease term only, all renewal and extension periods, or continues until released in writing by the landlord. The guarantee should also state that it covers any liabilities that accrued during the lease term but remain unpaid after the lease expires.
Indemnity: Including a separate indemnity alongside the guarantee provides the landlord with a primary obligation that survives any defect in the underlying lease and strengthens the landlord's position if the lease is later found to be void or unenforceable.
Additional compliance elements for a Lease Guarantee / Guarantor Agreement (Australia) used in Australia include: Under state and territory residential tenancies legislation, including the Residential Tenancies Act 1997 (Vic), Residential Tenancies Act 2010 (NSW), and equivalent Acts in other jurisdictions, tenancy tribunals (NCAT in NSW, VCAT in Victoria) adjudicate disputes. The Real Property Act 1900 (NSW) and Transfer of Land Act 1958 (Vic) govern property registration through state land registries. Section 52 of the Australian Consumer Law (Schedule 2, Competition and Consumer Act 2010) prohibits misleading conduct in property transactions. The Foreign Acquisitions and Takeovers Act 1975 (Cth) requires FIRB approval for foreign purchasers. Forms-legal.com provides this template as a starting point for Australia-compliant documentation.
Cite this page
Reference this free template in an article, syllabus, or research note:
Forms Legal. (2026). Lease Guarantee / Guarantor Agreement (Australia) (Australia) [Legal document template]. Forms Legal. https://forms-legal.com/australia/real-estate/leases/lease-guarantee-guarantor-agreement-australia
"Lease Guarantee / Guarantor Agreement (Australia) (Australia)." Forms Legal, 2026, https://forms-legal.com/australia/real-estate/leases/lease-guarantee-guarantor-agreement-australia.
@misc{formslegal-lease-guarantee-guarantor-agreement-australia,
author = {{Forms Legal}},
title = {Lease Guarantee / Guarantor Agreement (Australia) (Australia)},
year = {2026},
howpublished = {\url{https://forms-legal.com/australia/real-estate/leases/lease-guarantee-guarantor-agreement-australia}},
note = {Free legal document template. Based on Real Property Act 1900 (NSW)}
}Also available for these jurisdictions:
Frequently Asked Questions
A lease guarantor is typically required by an Australian landlord when the tenant presents a higher-than-normal credit risk. The most common situations include: where the tenant is a company (particularly a private company or small proprietary company) without a significant asset base or trading history; where the tenant is a new business with no established credit history; where the tenant has a poor credit rating or has had previous insolvency events; where the proposed lease is for a significant term or involves a substantial rent commitment; and where the security deposit or bank guarantee provided by the tenant is insufficient in the landlord's view. For commercial and retail leases, it is standard practice in Australia for the landlord to require the directors of a company tenant to provide personal guarantees. This is because a company can be deregistered or wound up with limited funds remaining to satisfy the landlord's claims, whereas a personal guarantee gives the landlord recourse against the directors' personal assets. For residential tenancies, guarantors are sometimes required where the prospective tenant has insufficient income, a poor rental history, or is a student or young person without an established rental history.
A guarantee and an indemnity are related but legally distinct obligations that are commonly included together in Australian lease guarantee documents. A guarantee is a secondary obligation — the guarantor promises to pay or perform if the tenant (the primary obligor) defaults. Because the guarantee is secondary, it is dependent on the existence and enforceability of the lease. If the lease is void or unenforceable (for example, because the tenant lacked legal capacity to enter into it), the guarantee may also fail. An indemnity, by contrast, is a primary obligation — the guarantor promises to indemnify the landlord against loss regardless of whether the lease is enforceable. An indemnity is not dependent on the validity of the underlying lease and provides the landlord with a more effective form of protection. For this reason, most sophisticated Australian commercial landlords require both a guarantee and an indemnity in their lease guarantee documents. The indemnity ensures that even if there is a technical defect in the lease that prevents the guarantee from being enforced, the landlord can still recover its losses from the guarantor under the indemnity.
Yes. While many Australian landlords prefer an unlimited personal guarantee, it is common in practice — particularly for retail leases governed by the Retail Leases Acts — for the parties to negotiate a cap on the guarantor's liability. A guarantee cap limits the guarantor's total liability to a fixed dollar amount, regardless of the amount the tenant actually owes under the lease. Common cap amounts in Australian commercial leases are equivalent to three to twelve months' rent (plus GST and outgoings). In some states, the applicable Retail Leases Act limits the amount of security (including guarantees) that a landlord can require. For example, in New South Wales, the Retail Leases Act 1994 (NSW) places limits on the types of security a landlord can require from a retail tenant. Where the original lease also requires a bank guarantee or security deposit, the landlord and guarantor sometimes agree to a cap that reflects the security already provided. The cap should be clearly expressed as a total aggregate amount covering all claims under the guarantee, not just per-incident claims.
Whether a lease guarantee extends to a renewal or extension of the lease depends on the terms of the guarantee itself. A well-drafted guarantee for Australian commercial or retail leases will usually expressly state whether the guarantee covers any renewal, extension, or variation of the original lease. If the guarantee is expressed to cover 'the Lease including any renewals or extensions', it will generally bind the guarantor during any renewal period exercised by the tenant. If the guarantee is limited to 'the initial term only', the guarantor will not be liable for the tenant's obligations during any renewal or extension period. Where the guarantee does not expressly address this, Australian courts have generally held that a variation or renewal that is materially different from the original lease may discharge the guarantor if the guarantor did not consent to the variation. To avoid this outcome, landlords typically include a clause in the guarantee stating that any variation, renewal, or extension of the lease does not discharge the guarantor's obligations, and that the guarantor consents in advance to such changes.
A guarantor who pays the landlord under a lease guarantee generally has the right of subrogation — that is, the right to step into the landlord's shoes and pursue the tenant for recovery of the amount paid. This right of subrogation is a well-established principle of Australian guarantee law. In addition, where there are multiple guarantors who are jointly and severally liable, a guarantor who pays more than their proportionate share has a right of contribution against the co-guarantors to recover the excess. However, most well-drafted lease guarantees in Australia include a 'postponement of rights' clause that prevents the guarantor from exercising subrogation or contribution rights against the tenant or co-guarantors until all of the tenant's obligations under the lease have been fully satisfied. This clause protects the landlord from having the guarantor's recovery claims compete with the landlord's own claims against the tenant. Once the tenant's obligations are fully discharged, the guarantor may pursue the tenant for reimbursement as a creditor.
This template is provided for informational purposes only and does not constitute legal advice. Laws vary by jurisdiction and change over time. Consult a qualified attorney for advice specific to your situation.Full disclaimer
Found an error? Let us knowRelated Documents
You may also find these documents useful:
Commercial Lease Agreement (Australia)
Create a comprehensive Australian Commercial Lease Agreement covering permitted use, rent and GST, CPI and market rent reviews, outgoings, bank guarantee, make good obligations, assignment conditions, insurance requirements, and option to renew. Compliant with state-specific Retail Leases Acts (NSW, VIC, QLD, WA, SA) and the GST Act 1999.
Lease Amendment / Variation Agreement (Australia)
A Lease Amendment and Variation Agreement is a formal written document that modifies one or more terms of an existing lease without replacing the original agreement in its entirety. In Australia, lease amendments are essential legal instruments used by landlords and tenants to record mutually agreed changes to the lease — whether those changes involve a rent adjustment, a variation in the permitted use of the premises, a modification of maintenance obligations, or any other term of the original lease. By executing a signed amendment, both parties create a legally binding record of the varied terms that supplements and forms part of the original lease agreement.
Residential Tenancy Agreement (Australia)
Create a legally compliant Residential Tenancy Agreement for any Australian state or territory. Covering landlord and tenant rights, rent, bond, condition report, maintenance obligations, break fees, and termination procedures in accordance with the NSW Residential Tenancies Act 2010, VIC Residential Tenancies Act 1997, QLD Residential Tenancies and Rooming Accommodation Act 2008, and equivalent state legislation.
Commercial Sublease Agreement (Australia)
Create an Australian Commercial Sublease Agreement for the subletting of commercial or retail premises. Covers head lease details, head landlord consent, permitted use, sublease term, rent and GST, outgoings, bank guarantee or security deposit, make good obligations, Subtenant’s compliance with head lease, and Retail Leases Act compliance across all states and territories.
Lease Assignment Agreement (Australia)
Create a comprehensive Australian Lease Assignment Agreement for the transfer of a commercial, retail, or residential lease from an outgoing tenant (assignor) to an incoming tenant (assignee). This template covers all key aspects of a lease assignment under Australian property law, including landlord consent, the consideration (lease premium or goodwill payment) payable to the assignor, the release or continuing liability of the assignor, security deposit arrangements, assignor warranties, and stamp duty responsibility. Suitable for NSW (Conveyancing Act 1919), VIC (Property Law Act 1958), QLD (Property Law Act 1974), and all other Australian states and territories. A lease assignment is one of the most significant transactions in commercial property law. When a business changes hands, a tenant relocates, or a lease needs to be restructured, the assignment of the existing lease is often the most commercially efficient way to deal with the unexpired lease term. An assignment transfers all of the tenant's rights and obligations under the existing lease to the incoming tenant, who steps into the shoes of the outgoing tenant and must perform all of the tenant's obligations from the assignment date until the lease expires. Under Australian property law, most commercial and retail leases require the landlord's prior written consent before the lease can be assigned. The landlord's right to withhold consent is not unlimited — under the Retail Leases Acts in NSW, VIC, and QLD, a landlord cannot unreasonably withhold consent to an assignment of a retail lease. The landlord may, however, impose reasonable conditions on consent, such as requiring the incoming tenant to provide a new bank guarantee, enter into a deed of covenant directly with the landlord, or demonstrate financial capacity to meet the lease obligations. One of the most critical issues in a lease assignment is whether the outgoing tenant (assignor) is released from all future obligations under the lease after the assignment takes effect. Under Australian common law, an outgoing tenant who assigns a lease is not automatically released from liability — if the incoming tenant defaults, the landlord may pursue the original tenant for the outstanding obligations. A formal release by the landlord, documented in the assignment agreement, is the only way for the outgoing tenant to achieve a clean break. This template includes a detailed release clause and a corresponding 'no release' alternative, depending on what the parties have negotiated. The consideration (or lease premium) payable by the incoming tenant to the outgoing tenant for the assignment is a common feature of commercial lease assignments, particularly where the lease contains below-market rent, valuable options to renew, or where the assignment forms part of the sale of a business. The consideration may be subject to stamp duty in some Australian states — this depends on the state, the amount of the consideration, and whether the lease is a dutiable instrument in that state. The template includes a stamp duty clause allocating responsibility between the parties, but parties should obtain specific advice from the relevant state revenue authority or a solicitor. For retail leases, the assignment process is subject to additional requirements under the applicable Retail Leases Act. In New South Wales, the Retail Leases Act 1994 (NSW) provides that a landlord cannot unreasonably withhold consent to an assignment and sets out specific grounds on which consent may be withheld (such as the proposed assignee being of insufficient financial capacity or proposing a use that is inconsistent with the permitted use under the lease). Similar provisions exist in Victoria and Queensland. Landlords who withhold consent without reasonable grounds may be liable to the outgoing tenant for any resulting loss. The assignor warranties section is designed to protect the incoming tenant from taking over a lease that is already in breach. Standard warranties given by the outgoing tenant include confirmation that the lease is current and in full force, that all rent and outgoings have been paid to date, that no notices of breach or termination have been received, and that no disputes are pending. If the assignor is unable to give these warranties, the parties should investigate and resolve any outstanding issues before the assignment proceeds. This template is designed for use by commercial solicitors, business brokers, property managers, and commercial tenants managing lease assignments throughout Australia.