LEASES & TENANCY

LEASE *Formality?
• Letting of a land for a term exceeding 3 years & is a
registrable interest. • The parties must execute:
• type of dealing where registered proprietor (lessor) - Form 15A and register it at the relevant land office if it
allows another person (lessee) to occupy the land for a is for a lease transaction.
specific duration (consideration: rent payment). - Form 15B and register it at the relevant land office if it
• NLC requires parties to sign specific forms (must be is for a sub-lease transaction.
registered). - If lease or sub-lease relates to alienated land, must
attached a plan and description to enable to identified.
TENANCY
• Tenancy-letting of land for a term not exceeding 3 *General restrictions on powers?
years and is not a registrable interest.
• S. 225 NLC (refer)
*Characteristic of a lease? • No lease or tenancy may be granted to 2 or more
persons otherwise as trustees or representatives.
1. Given the right to exclusive possession of the land. • If the alienated land is subject to a charge, written
2. Parties must have intended to create a lease and not a consent from the chargee must be obtained prior to the
licence. creation of the lease or sub-lease.
3. A lessee must be given a definite period. • Such consent when obtained, must be signified when
executing the relevant instrument in Form 15A or Form
Yong Tong Hong v Siew Soon Wah 15B.

- The landlord served a month notice to AP to quit *Consent from chargee?

unless the AP (tenant) accept a new tenancy at an
increased rental. Murugappa Chetty v Low
- 1 year later, the landlord transferred the land to his
children, (RS). - Chargee’s consent was not obtained in of 30 months
- RS brought action to eject AP based on 2 grounds: it unregistered lease granted by the owner.
was void for uncertainty- the term stated therein “the - When the chargee brought foreclosure proceedings
tenancy shall be permanent” and void for lack of because of the chargor’s default, the court ordered the
registration. lessee’s caveat to be removed.
- Held: No uncertainty as the parties has agreed for - Held: Where any land subject to a charge, the
some form of permanent letting. (S. 222(3) NLC) & proprietor shall not be capable of granting any lease
even an unregistered lease is void, it is good as an without first obtaining the consent of the chargee.
agreement for a lease.
*Express & implied provisions on the lessors’s part?
*Duration?
• To pay all rent due to the state authority.
• Every lease or sublease must exceed 3 years; • To guarantee quiet enjoyment of the property to the
- Min above 3 years and max up to 99 years (for whole lessee.
land). • During tenancy, if the property unfit for occupation not
- Min above 3 years and max of 30 years (if part of the by lessee’s negligence, the rent cease to be payable
land). until the property fit again for use (if remain 6 months,
- Min above 3 years and max of 30 years (if sublease). the lessee may terminate by giving 1 month notice).
• To observe and perform all express or implied
• A lease less than 3 years is term as tenancy/ tenancy conditions.
exempt from registration. • Not to transfer the lease or sub-lease or part without
the written consent of the lessor.
*Power to grant lease under NLC? • To pay the rent, rates, taxes in respect of the property.

• S. 221, 222. 223

Khoo Ee Liang v Henry Waugh Ltd Margaret Chua v Ho Swee Kiew & Ors

- The lessor claimed from the lessee the sum of - AP (registered prop) granted to the RS a lease over a
RM38118.78 which he had paid as rates and taxes to shophouse for a term of 25 years at the rental of
the authorities. RM280 per month.
- Held: In the absence of any agreement to the contrary, - The lease was not registered, and AP wanted to sell the
all rates and taxes are payable by the lessee and premised and offered the RS to purchase the premise at
consequently the lessor was entitled to recover the said RM90,000 within 3 days.
sum from the lessee. - RS claimed for specific performance, AP appeal on the
ground that the lease was not registered.
*Determination of lease? - Held: Although the lease was not registered, but it’s a
valid as an agreement for a lease and can be enforced
• Express surrender. in equity by specific performance.
- Lease may be terminated before the original
termination by landlord agree to surrender the lease. Wan Salimah v Mahmood bin Omar
- Effected by an instrument in Form 15C.
- Must obtain written consent from the chargee. - PF entered into a lease agreement with DF who lease
his share in land with PF for 15 years for rental of
• Expiry of term. RM1800 per year.
- S. 240, S. 313 - The lease was not registered, DF refused to sign Form
- Upon expiry of the term of tenancy exempt from 15A.
registration, endorsement made on the RDT may be - Held: The lease was good as an agreement enforceable
cancelled. in equity and ordered the Def to sign the Form 15A.

• Service of notice to quit. *Difference between lease and licence?

- Issue by one party to another
- Notice must express an unconditional intention to LEASE LICENCE
terminate the lease of a certain date.
Creates interests in land. Does not create interests in
• Operation of law. land but a personal
- Where there has been a frustration of the contract. obligation.
- Eg : Compulsory land acquisition by the government.
Exclusive possession of the Right to occupy
• Forfeiture. land.
- When the landlord is given the right to terminate the
lease upon the violations of certain terms and Dispossession entitles the Compensatable in breach
conditions. lessee to recover possession with damages.
- S. 234, 235 NLC (refer) of the land.
- Forfeiture is affected either by re-entry of the land or
action in the court. A right in rem A right in personam
- Eg : failure to pay rent, unlawful use of the premise.

*Effect of unregistered lease? Woo Yew Chee v Yong Yong Hoo

• If unregistered will still create a lease relationship - Court test: the nature and quality of occupancy whether
between lessor and lessee. it was intended that the occupier should have a stake in
• Such lease stands as an equitable lease. the premises sub-let or whether he should have only a
• Confers only a right in personam and not a right in personal privilege.
rem. - Court will look at the arrangement between parties and
• Parties may sue for breach of provisions. their intention.
TENANCY EXEMPT FROM REGISTRATION Mok Deng Chee v Yap See Hoi

• Tenancy not exceed 3 years. - RS were the owners of a house.

• Not registrable under NLC. - The house was subsequently sold to the AP’s father
• Can be created by word of mouth or in writing. which inherited by AP and continued paying the
• The interests of the tenant may be protected against ground rent of one dollar.
subsequent dealings is by RDT under s. 316 NLC. - AP demolished the house and built a completely new
• Failure to endorse the TER would not bind any house.
subsequent tranferee, chargee, sub-lesee of the land. - The parties started to quarrel and RS served on AP a
notice to quit.
Than Kok Leong v Lo Kim Hai - Held: No written agreement between the landowners
and the house owners regarding the tenancy is
- Held: TER does not bind a subsequent purchaser immaterial. Payment of rent shows there is tenancy.
unless prior to the sale and transfer, an endorsement of - The equity is not lost by the changes made to the house
the tenancy has been made pursuant to s. 213(3). not by the changes in its relationship.

Luggage Distributors Sdn Bhd v Tan Hor Teng *Tenancy with estopple?

- AP (registered prop) of a property ground floor rented • Invoked by the landlord against the tenant.
out to the RS. • S.116 of the Evidence Act: no tenant be permitted to
- Terms of the rental- 2 rears + further 2 years option. deny his landlord’s title.
- No endorsement of the tenancy on the RDT. • 2 conditions: Possession & permission.
- AP entered into agreement to sell the property.
- RS exercised option to renew and entered a private Wee Tiang Yap v Chan Chan Bros
caveat on the RDT. Singma Sawmill Co. Sdn. Bhd. v Asian Holdings Sdn. Bhd.
- Held: S. 224(b) prohibits any option for renewal from
being considered in determining the length of time. 
TER is not a registrable interest-not qualify as
caveatable interest.

*Tenancy coupled with equity?

• A tenant spends his money to improve the land with an

expectation of being able to remain on the land.
• If the landlord serves a notice to quit, the tenant may
plead a doctrine of tenancy coupled with equity.
• The landlord is estopped from terminating the tenancy
until he has satisfied the tenant’s equity either:
1. By giving more time for the tenant to be in
possession of the land.
2. To compensate the tenant.

Inwards v Baker

- Held: if the owner of land requires or allows another,

to expend money on the land under the expectation
that he would be able to remain there, that raises an
equity in the licence such as to entitle him to stay.