Leases

Many leases of retail space, office space and parts of a building merely define the Premises as “that part of the building indicated on the plan annexed“.

By defining the premises in this manner it is only defined two-dimensionally (horizontally). The plan may identify the premises boundaries as being the interior face of walls, the median point of walls or the exterior face of walls.

Such a plan does not identify premises horizontally e.g.: (a) what is the lower level of the premises – the surface of the floor or from the top of any floor coverings; and (b) does the premises extend to the underside of a ceiling, the upper side of a ceiling or the underside of the roof or does it include the roof.

The failure to have a three-dimensional definition leads to uncertainty as to lessor and lessee obligations which refer to the premises. Major lessee obligations include repair and make good.

A three-dimensional definition of premises is essential to provide certainty with respect to the obligations to repair.

Example: If the premises is defined two-dimensionally as for example “part of the second floor of a two level building” by reference to an area shown on a plan annexed and the floor of the second level is wooden does the lessee: (a) have an obligation to repair the wooden floor; and/or (b) have obligation to repair the roof.

All premises are different. The horizontal extremities of any premises also need to be considered.

Example: In retail premises where the shopfront or walls are glass, to prevent a lessee from using the glass for advertising or screening purposes the premises definition in relation to the glass should possible say “to but not including the interior face of the glass”. The lessee will then not have a right to affix signage or screening film to the exterior or interior of the glass.

Easements Land is a limited resource. With modern technologies and developments there is an increasing need to use a three-dimensional definition in easements.

An easement is an interest in land. The party who has the benefit of an easement has a proprietary right. That proprietary right cannot be unilaterally changed by the grantor of the easement.

At present s181 of the Property Law Act only provides limited rights to have a court modify or extinguish easements.

Easements have generally been identified by way of an area on a survey plan. That is the easement is defined horizontally – two-dimensionally. The issue which arises is: (a) does the grantee have any rights under the ground level of the easement area; and (b) is there any limitation on the height of the grantee’s rights above the ground level?

The courts approach is that the height or depth of a right of way only extends as far as is required by the reasonable needs of the person having the benefit of the easement area. A three-dimensional definition in the grant of easement can overcome the necessity of having a court determine what is reasonable and avoiding the uncertainty of whether the court is prepared to decide the matter and/or determine what is reasonable.

Example: The owner of a commercial property has granted an adjoining owner an easement of right of way for parking purposes over its existing parking area and driveway area. The owner wishes to further develop the existing parking area. The owner cannot build on existing parking area as that would interfere with the adjoining owner’s rights to park on the existing parking area. The easement does not have a three-dimensional definition. Can the owner construct a podium level above the existing car parking area and undertake the further development on top of the podium level. The question, in the absence of the three-dimensional definition is what height does the podium need to be so that the rights of the adjoining owner for access and parking over the existing parking area under the podium are not interfered with.

The absence of the three dimensional definition in the easement can result in uncertainty and/or delay and/or prevent the future development of the owner’s land.