If you are the tenant of a commercial lease in Queensland, you will need to consider how best to protect your interests in the property. One way to do so is to register your lease. While registering a lease is not compulsory in Queensland, it is wise to do so if your lease is over three years in length. This article explains:
- what registering a lease entails; and
- when it is a good idea to register one.
What Is a Lease?
When you enter into a lease with a landlord, you receive an exclusive right to use a property for the term of the lease. The landlord retains ownership and title. However, you have the right to occupy and use the land without their interference. If you breach the lease, the landlord has a right to terminate the lease.
In Queensland, state laws regulate both the lease and how the landlord is required to deal with the land.
What is Registration?
As a tenant, the landlord may ask you if the lease is to be registered. Lease registration refers to the process of noting your interest in the lease on the title of the land. You can do this through the state government department in charge of dealing with land titles.
In Queensland, at the time of writing, this department is the Department of Natural Resources, Mines and Energy. Once a lease is registered, the registration acts as notice to anyone who searches the land title that the lease exists.
Continue reading this article below the formProtection for Shorter Leases
It is not compulsory to register a lease in Queensland. However, registration can benefit you in certain circumstances. This is especially the case for leases that are longer than three years in length.
If your lease is less than three years in length, the law has inbuilt protections for tenants, known as ‘indefeasibility in title’. This means that registration is not necessary because the law will protect your interest in the lease.
Protection for Longer Leases
For leases three years and longer, on the other hand, there is no automatic legal protection. Therefore, in these circumstances, registration may be a good idea. If you want to ensure that your rights are legally protected, registration is particularly important.
What Are the Benefits of Registering A Long-Term Lease?
Registering a lease of over three years in Queensland ensures that the land title officially notes your interest in the land.
Having your interest registered on the title creates a legal interest in the leased premises. This means that your name is noted on the title to the land as the tenant and becomes a ‘legal fact’. When a lease is noted on the title, it takes the form of an entry on the computer folio for that property. This makes the title easily discoverable when somebody searches for it on the Department of Natural Mineral Resources and Energy database.
An unregistered lease, on the other hand, is an ‘equitable interest’. This means that your interest as the tenant is not noted on title to the land. Importantly, a legal interest will generally trump an equitable interest.
Registering a lease is important if the landlord wants to sell the land during the term of your lease. In this case, any prospective purchaser can search the titles register and see that your lease is registered. The prospective purchaser will need to continue to honour the lease and will be bound by the lease as your new landlord.
However, if you do not register a lease of three years or more and the landlord decides to sell, a prospective purchaser may not know about your lease. If the purchaser buys the property without knowledge of your lease, they may not be bound by the lease. This means that they could evict you.
In these circumstances, registering the lease ensures that you can enforce your rights under the lease against the new landlord.
This guide will help you to understand your options when you purchase a business with leased premises.
Key Takeaways
If you are the tenant of commercial premises in Queensland, you should consider whether to register your lease. For leases under three years, registration is not compulsory because the law automatically provides protection. For leases over three years, however, there is no such protection. Therefore, registration may be wise. If you have questions about registering a commercial lease in Queensland, contact LegalVision’s leasing lawyers on 1300 544 755 or fill out the form on this page.
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