Tenants who rent land, but not a dwelling

In some rare circumstances, a lease may relate to land only, and not to a dwelling upon the land (and the land is not a residential site in a residential park). In some of these cases, the arrangement between the landlord and tenant might be that the tenant will erect their own dwelling on the land; in other cases, the tenant may have bought an existing dwelling, as well as the ‘underlease’ of the land, from the previous resident.

If you have a lease for land only, you are not covered by the Residential Tenancies Act 2010 (RT Act 2010), because it applies in relation to ‘residential premises’, which means more than bare land (Turner v York Motors Pty Ltd[1951] HCA 52). For similar reasons, you cannot be covered by the Landlord and Tenant (Amendment) Act 1948 (NSW) (the LTA Act 1948), either: it, too, applies to ‘premises’.

Be aware, however, that what you think is a lease for land only, and not the dwelling upon the land, may actually be a lease for both. This is because the law generally regards dwellings to be fixtures: that is, they are part and parcel of the land.

This means that when you build a house upon leased land, it will generally become part of the property (Turner v York Motors Pty Ltd[1951] HCA 52, per Dixon J). It appears that the lease will at that point become a lease with respect to premises, and so will be a tenancy agreement covered by the RT Act 2010.

It also means that if you have purchased an existing dwelling from a previous resident, with an underlease of the land, the dwelling will generally be a fixture and part of the land – even if you (and the landlord, for that matter) believe that you acquired it separately to the land, and that the landlord has no interest in it (May v Ceedive Pty Ltd[2006] NSWCA 369). In this case, the dwelling is actually part of the landlord’s property, and the lease will be an agreement under the RT Act 2010 (or even the LTA Act 1948, if all of the usual tests are satisfied).

The law presumes that a dwelling and other object affixed to land (that is, not merely resting on the land by its own weight) is a fixture. The party who claims that it is not a fixture, and so not part of the land, bears the onus of proving that claim. Whether it is or not will depend largely on the intention of the person who affixed it to the land.