New South Wales Consolidated Acts

CONVEYANCING ACT 1919 - SECT 106

106 Leasing powers where mortgages or certain charges

(1) A mortgagor of land while in possession shall as against every incumbrancee have by virtue of this Act power to make from time to time any such lease of the mortgaged land, or any part thereof, as is in this section described and authorised. For the purposes of this subsection the expression
"mortgagor" does not include an incumbrancee deriving title under the original mortgagor.

(2) A mortgagee of land or person having the benefit of a charge on land while in possession shall as against all prior incumbrancees (if any) and as against the mortgagor or person whose land is subject to the charge have by virtue of this Act power to make from time to time any such lease as aforesaid.

(3) The lease which this section authorises is--A lease for any term not exceeding five years.

(4) Every person making a lease under this section may execute and do all assurances and things necessary or proper in that behalf.

(5) Every such lease shall be made to take effect in possession not later than three months after its date.

(6) Every such lease shall reserve the best rent that can reasonably be obtained, regard being had to the circumstances of the case, but without any fine being taken or the rent made payable in advance except as to the last payment which may be made payable on a day not more than one month before the expiration of the term.

(7) Every such lease shall contain a condition of re-entry on the rent not being paid within a time therein specified not exceeding thirty days, and the covenants implied by section 84 shall not be excluded therefrom.

(8) Where the land comprised in any such lease is under the provisions of the Real Property Act 1900 , the lease shall be registered in accordance with the provisions of that Act.

(8A) Where the land comprised in such lease is not under the provisions of the Real Property Act 1900 , the lease shall be executed by the lessee and registered under Division 1 of Part 23.

(9) Within one month after having made a lease under this section--

(a) a mortgagor shall deliver to the mortgagee (or, if there is more than one, to the mortgagee first in priority) and, where another person has the benefit of a charge on the land, to the other person, or

(b) a person whose land is subject to a charge shall deliver to the person having the benefit of the charge and, where the land is mortgaged to another person, to the mortgagee (or, if there is more than one, to the mortgagee first in priority),

a duplicate or a counterpart of the lease duly executed by the lessee, but the lessee shall not be concerned to see that this provision is complied with.

(10) A contract to make or accept a lease under this section may be enforced by or against every person on whom the lease if granted would be binding if--

(a) in so far as the lease, if granted, would comprise land under the provisions of the Real Property Act 1900 --a caveat has been lodged pursuant to section 74F of that Act in respect of the contract, and

(b) in so far as the lease, if granted, would comprise land not under the provisions of the Real Property Act 1900 --the contract has been registered pursuant to Division 1 of Part 23.

(11) This section applies in relation to a mortgagor and mortgagee or the parties to a charge only if and in so far as a contrary intention is not expressed in the instrument creating the mortgage or the covenant in respect of which the charge arose, or otherwise in writing, and shall have effect subject to the terms and conditions of that instrument, or any such writing.

(12) Nothing in this Act shall prevent the instrument creating the mortgage or the covenant in respect of which the charge arose from reserving to or conferring on either or both of the parties to the mortgage or charge any further or other powers of leasing or having reference to leasing, and any further or other powers so reserved or conferred, shall be exercisable as far as may be as if they were conferred by this Act, and with all the like incidents, effects, and consequences, unless a contrary intention is expressed in that instrument.

(13) Nothing in this Act shall be construed to enable a mortgagor or mortgagee to make a lease for any longer term, or on any other conditions than such as could have been granted or imposed by the mortgagor, with the concurrence of all the incumbrancees, if this Act had not been passed.

(14) This section applies only in case of a mortgage made after the commencement of this Act, but the provisions thereof, or any of them, may by agreement in writing, made after the commencement of this Act between mortgagor and mortgagee, be applied to a mortgage made before the commencement of this Act, so nevertheless that any such agreement shall not prejudicially affect any right or interest of any mortgagee not joining in or adopting the agreement.

(15) The provisions of this section referring to a lease shall be construed to extend and apply as far as circumstances admit to any letting, and to an agreement, whether in writing or not, for leasing or letting.

(16) The power of leasing conferred by this section shall, after a receiver of the income of the mortgaged or charged land has been appointed under this Act by the mortgagee or person having the benefit of the charge and the instrument by which the appointment was made has been registered, be exercisable while that appointment is in force by that mortgagee or person instead of by the mortgagor or person whose land is subject to the charge in relation to any land affected by the receivership in the same manner as it would be if the mortgagee or person having the benefit was in possession of the land and the mortgagee or person may, by deed, delegate that power to the receiver.

(16A) Where a trust corporation has been appointed receiver pursuant to section 115(6A), a delegation under subsection (16) by that trust corporation in its capacity as mortgagee or person having the benefit of a charge shall be sufficiently evidenced by a statement in the lease of the decision of that trust corporation to exercise the power conferred by subsection (16).

(17) This section applies to land under the provisions of the Real Property Act 1900 subject to mortgage or charge under that Act and section 53(4) of that Act shall not apply to leases authorised under this Division.