While all leases technically create a leasehold estate, it is NSW LRS practice to treat leases as interests in the land and record them in the Second Schedule where possible. A leasehold estate folio may be created for a lease:
- at the request of the lessor or
- to facilitate the registration of leases and subleases on the title for a property containing numerous shops, suites, units, warehouse spaces etc.
A folio is also created for the estate in fee simple. A certificate of title is issued for the leasehold estate and for the estate in fee simple.
All notifications affecting the head lease are recorded on the leasehold estate folio. The type of dealing to be used with a leasehold estate folio is determined by the Schedule affected, eg a transfer of the lease must be drawn on a Transfer form 01T (PDF 100 KB) because the lessee is shown in the First Schedule; Note A Transfer of Lease form 01TL suitably modified will be accepted; a mortgage of lease must be drawn on the National Mortgage form.
A sublease is recorded as a lease of the leasehold estate. All notifications affecting the estate in fee simple are recorded on the fee simple folio.
- the certificate of title for the estate in fee simple is not required for a dealing affecting a leasehold folio. The certificate of title for the leasehold folio must be produced if required and
- when dealing with a leasehold folio, the related fee simple folio must also be checked, especially for caveats.
Leasehold Strata Schemes
Where a Strata scheme is registered on a leasehold folio, folios for the common property and the lots in a Strata scheme are created. A folio is also created for the estate in fee simple. Certificates of title are issued for the lots in the leasehold Strata scheme, the common property, and for the estate in fee simple. The fee simple certificate of title is held by the registered proprietor. See Baalman And Wells, Land Titles Office Practice, Lawbook Co. 2001 [525.750], [545.800].
The requirements for dealings affecting leasehold estate folios, and Strata schemes in general apply to these folios. Note The Strata scheme is terminated on the expiry of the lease.