Top Line Toppled – A Welcome Development For Landlords And Tenants

Section 73 of the Land Title Act (British Columbia) provides, in effect, that unless an approving officer approves, a person may not lease an unsubdivided piece of a legal parcel of land for a term of more than three years (leases of portions of a building are exempt). Prior to International Paper Industries Ltd. v. Top Line Industries Inc. (1996), 20 B.C.L.R. (3d) 41 (C.A.), it was generally accepted that the effect of this restriction was that a lease of part of an unsubdivided parcel of land did not create an interest in land registrable in the Land Title Office or enforceable against a third party purchaser, but did create personal rights enforceable as between the original parties to the lease. In Top Line, the B.C. Court of Appeal sent shockwaves through leasing and legal circles by deciding that a lease granted contrary to s. 73 was void from the outset and did not create personal rights between the parties to the lease. The decision jeopardized hundreds, if not