In the context of the COVID-19 crisis, and
Australia’s economic recession, a Chilean restaurant in the city asked its
landlord for a rental reduction. The landlord agreed to a 50% reduction in
August 2020, and therefore the rent was reduced by 50% from September
2020. The Chilean restaurant, in reliance on the promise to reduce the
rent, refurbished the landlord’s premises. A retractable front window, to
provide for socially distanced tables on the street front, and a new take away
food oven for preparing home deliveries, were also installed.
In March 2022, the landlord notified the Chilean
restaurant owner that the rent would be put back up to its original rate. The
landlord also communicated that he wished to be reimbursed for the reduction in
the rent between September 2020 and March 2022.
Which of the following statements is CORRECT ?

Question

In the context of the COVID-19 crisis, and
Australia’s economic recession, a Chilean restaurant in the city asked its
landlord for a rental reduction. The landlord agreed to a 50% reduction in
August 2020, and therefore the rent was reduced by 50% from September
2020. The Chilean restaurant, in reliance on the promise to reduce the
rent, refurbished the landlord’s premises. A retractable front window, to
provide for socially distanced tables on the street front, and a new take away
food oven for preparing home deliveries, were also installed. 
 In March 2022, the landlord notified the Chilean
restaurant owner that the rent would be put back up to its original rate. The
landlord also communicated that he wished to be reimbursed for the reduction in
the rent between September 2020 and March 2022. 
 Which of the following statements is  CORRECT ?

Answer

The promise to reduce the rent is enforceable
and cannot be modified without the assent of the Chilean restaurant: The
landlord can neither put the rent back up again nor claim the
past unpaid rent.

Answer

According to the doctrine of promissory estoppel, the
landlord has the right to put the rent back up again, but would be prevented
from claiming back the past discounted rent.

Answer

Provided that the promise to reduce the rent is
in writing and is signed by the parties, the
landlord can neither put the rent back up again nor claim the
past unpaid rent.

Answer

The promise to reduce the rent is not
enforceable: The landlord can put the rent back up again and can also claim the
past unpaid rent.

Crowdly

In the context of the COVID-19 crisis, and Australia’s economic recession, a Chi...

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