Lease registration is currently voluntary in each State and
Territory (refer to Table 8.1 of the Draft Report).
Leasing practice differs in the various States and Territories
in relation to registration.
The differing leasing practice stems from the various Torrens
Title legislation in each State and Territory which confer an
indefeasible leasehold title upon tenants.
Generally speaking, short term leases to tenants who are in
possession do not need to be registered to give such tenants an
indefeasible leasehold title.
The concept of a 'short term' lease differs between
NSW, Qld, Tas, ACT – short term means 3 years or
SA and NT – short term lease means 1 year or
WA – short term lease means 5 years or less.
The exception is Victoria where there is no upper limit on the
length of the term – a lease to a tenant who is in
possession grants an indefeasible leasehold title regardless of the
term. Consequently, leases are rarely registered in Victoria.
A tenant under a lease which is not a short term lease should
ensure that the lease is promptly registered:
So that the lease is effective at law; and
To protect the tenant against a successor in title of the
Retail tenancy legislation in all States and Territories (except
Qld) mandate minimum 5 year terms so that in all jurisdictions
(other than Vic, Qld and WA), retail leases would normally be
expected to be registered.
However, in all jurisdictions (except WA) where minimum 5 year
terms are imposed, it is possible to circumvent the minimum 5 year
requirement by obtaining relevant certificates.
In Qld and the ACT, before lodging a lease for part of a
building (such as a shopping centre) for registration, a survey
plan of the leased shop prepared by a registered surveyor must be
attached to the lease. The costs to prepare such a plan (which are
typically passed on to tenants) range from $300 to $500.
Registration fees to register a lease (which are also typically
passed on to tenants) are set out in Table 8.1 of the Draft
In those jurisdictions where registration is not required to
obtain indefeasibility, tenants would be justified in objecting to
incurring extra costs merely to improve the transparency of the
retail tenancy market.
There is often a significant time delay between the signing of a
lease and registration due to the need to obtain mortgagee consent
(where required or applicable) and prepare a survey plan of the
leased shop. Mortgagee consent can often take several months to
obtain. Consequently, by the time a lease is registered, the
information may be 'out of date'.
Where lease incentives are given by a landlord to a tenant, they
are often not documented in the lease. Rather, they are commonly
included in some form of side deed which is intended to remain
confidential. As a result, registration of the lease may not
disclose the effective rent payable by the tenant.
If the objective is to improve the transparency of the retail
tenancy market then my suggested alternative to registration of
leases is to require the parties to the lease to prepare, sign and
lodge with a central authority an epitome of the lease in a
prescribed form which sets out the essential lease terms including
any lease incentives.
The epitome should be required to be signed by both parties to
the lease to ensure that there is less scope for inaccurate
information being passed on to the central authority.
The central authority would be charged with creating a public
register of the essential terms of leases which it would make
available for searching for a nominal fee using a variety of
The cost to the parties to prepare, sign and lodge such an
epitome should be minimal given that:
The essential commercial terms of a lease are foremost in the
parties minds when they sign the lease; and
Most landlords (and some larger tenants) require some form of
legal 'sign off' from their solicitors which sets out the
essential lease terms before they will sign the lease.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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