Do I have a valid lease and should I register it?

What is a lease?

A lease allows the lessee the right to exclusive possession to a property for a defined period of time Thomas v Sorrell (1874) Vaug 330

To determine whether you have a valid lease the decision in Radaich v Smith (1959) 101 CLR 209 sets our three principles to consider.

  1. Substance not form of the agreement – look at the provisions, nature of the premises.
  2. Intention – not decisive only when it assists to understand the effect of the agreement legally. Not relevant if the intention was a sham to hide there is no exclusive possession.
  3. Exclusive possession – construction of the instrument and the surrounding circumstances.

A further test as to the certainty of the commencement date of the lease should also be considered. The date of commencement and the term of the lease have to be certain or capable of being made Lace v Chantler [1944] KB 368.

Why should I register my lease?

Under the Torren System, a registered lease has priority over an unregistered one. If a party has entered into a lease agreement for a premises where they will conduct a retail business for a period of 4 years or more and the parties do not register the lease, the lessee may not be secure in that lease in the event the property owner decides to sell the premices and does not disclose the lease to the purchaser.  

Should you require any assistance to determine whether you have a valid lease or are concerned whether your lease has not been registered, please contact our office and one of our Solicitors on 02 4655 4224 or email at info@familyfocuslegal.com.au and we will be more than happy to discuss your matter with you.

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