Lease of land

A lease may be registered affecting whole or part of a current parcel.

If it is intended to lease a piece of land that comprises part of a current parcel, the site must be defined in either a deposited plan or a compiled sketch plan annexed to the lease. Any compiled plan must comply with the Registrar General's compiled plan policy.

The requirements for the plan and the associated lease document will depend on the length of the total term of the lease. The total term is the combination of the original term plus any option of renewal period. There are two periods to consider:

  • total term of 5 years or less, or
  • total term of more than 5 years.

Total term of 5 years or less

When the lease affects the whole of a lot in a current plan -  the body of the lease will simply identify the area to be leased by reference to the lot and deposited plan number. A new plan is not required.

When the lease affects part of a lot or lots in a current plan - it will be necessary to provide a plan to define the land in the lease. The description in the body of the lease should adequately define the land by reference to:

  • the unique way in which the land is designated in the plan, and
  • the plan used to define the boundary of the land being leased.

Examples

  • '... being part of the land in common property in Strata Scheme No. , situated at 345 Schemes Road, Strataville, hatched and designated A in the plan annexed to .... ', or
  • '... being the part shown in Lot...DP....'

A plan used to define the part of the lot or lots in the current plan should comply with one of the following:

  • a plan of compilation (not survey) annexed to the lease.
  • a plan of survey lodged as a deposited plan, where:
    • the plan must comply with normal plan preparation and lodgment requirements
    • the heading should state 'Plan of Part of Lot........for lease purposes'
    • the plan purposes will be 'LEASE'
    • no residue lot will be shown
    • normal survey plan requirements must be adopted, or
  • a plan which has already been lodged in NSW LRS and complies with one of the above standards.

Subdivision consent not required

A lease with a total term of 5 years or less does not constitute a subdivision in terms of Section 4B of the Environmental Planning & Assessment Act 1979. [see s.7A(3) Conveyancing Act 1919]. Consequently subdivision consent is not required.

However, any deposited plan for a lease with a total term of 5 years or less should bear a statement on the Administration Sheet e.g:

THIS PLAN IS ONLY AVAILABLE TO DEFINE LAND FOR LEASE PURPOSES WHERE THE TERM PLUS ANY OPTION FOR RENEWAL IS 5 YEARS OR LESS.

IT IS NOT AVAILABLE FOR SUBDIVISION OR TITLE ISSUE PURPOSES. 

Easements created by inclusion in a lease

Section 47(2)&(3) Real Property Act 1900 provides for the grant or reservation of an easement by a lease. The lessor must be the registered proprietor of the servient tenement (land burdened) in the case of a grant of easement, or of the dominant tenement (land benefited) in the case of a reservation of easement.  The reservation of an easement in favour of a third party is not authorised by s.47(3) Real Property Act 1900.

The approved Form of Lease Form 07L (PDF 234 KB)  should be used, accompanied by an annexure stating all references to title affected by the easement and a plan (for which the prescribed fee is payable) setting out the terms and the site.  The easement to be created must be included in the property leased panel of the lease form.

All relevant certificates of title should be lodged with the lease.

The easement will cease once the lease is terminated.

Total term for more than five years

A lease of land creates a subdivision under s.7A Conveyancing Act 1919 (formerly s.327AA Local Government Act 1919 now repealed) when the total of the original term of the lease, together with any option of renewal, is more than five years.

When the lease affects the whole of a lot in a current plan - the body of the lease will simply identify the area to be leased by reference to the lot and deposited plan number. A new plan is not required.

When the lease affects part of a lot or lots in a current plan - it will be necessary to provide a plan to define the land in the lease and the residue of any lot in a current plan affected by the leased area.

The plan must:

  • be a deposited plan of subdivision
  • bear a completed subdivision certificate and
  • be a survey, complying with the normal requirements for plan preparation and lodgment.

Alternatively, the lease may refer to a plan which has already been lodged in NSW LRS and complies with the above standards.

Note  A sub-lease with a term greater than five years will constitute a subdivision, even if the head lease affects the entirety of the parcel.