New South Wales Consolidated Acts

STRATA SCHEMES (LEASEHOLD DEVELOPMENT) ACT 1986 - SECT 40

40 Effect of merger of leasehold estate with lessor’s reversion

(1) On receipt of a notification given in accordance with section 39 and an application in the approved form before the leasehold strata scheme to which they relate is terminated (whether under section 37 or otherwise), the Registrar-General shall, if satisfied that the application has been duly made, make such recordings in the Register to effect the merger of leasehold and reversionary estates as the Registrar-General considers appropriate and, when those recordings are made:

(a) the leasehold strata scheme shall become a strata scheme within the meaning of the Strata Schemes (Freehold Development) Act 1973 ,

(b) the strata plan relating to the scheme shall become a strata plan within the meaning of that Act,

(c) each former lot shall become a lot within the meaning of that Act and, except as provided by paragraph (e), shall vest in the former lessee of the lot for an estate in fee simple,

(d) the former common property (if any) shall become common property within the meaning of that Act and, except as regards any lease acquired by the body corporate under section 22, shall vest in the body corporate for an estate in fee simple,

(e) the fee simple estate in any lot in relation to which a merger has not been recorded in the Register shall be held subject to the former lease of the lot,

(f) any registered mortgage, charge, covenant charge, easement, restriction on the use of land or positive covenant conferring or imposing rights or obligations with respect to the former leases of lots or the former lots shall confer or impose equivalent rights or obligations with respect to the lots created,

(g) any registered easement, restriction on the use of land or positive covenant conferring or imposing rights or obligations with respect to the former common property shall confer or impose equivalent rights or obligations with respect to the common property created, and

(h) except as provided by paragraph (e), the former leases of each former lot and the former lease of the former common property (if any) are determined.

(2) When lots and common property within the meaning of the Strata Schemes (Freehold Development) Act 1973 are created by subsection (1), that Act applies to and in respect of those lots and that common property and the Registrar-General shall record in a folio of the Register for each lot particulars of all estates and interests affecting that lot by virtue of subsection (1).