Purchasing a Company Title, Cross Lease or Moiety Title in South Australia is not as straight forward as buying a property that has its own title under the Torrens title system. It is not for everyone. The first hurdle to overcome is to make sure you have a clear understanding of what you are about to purchase!

Prior to Strata Titles legislation in 1988 and Community Title legislation in 1996, no provisions were in place to evidence ownership of a unit which was part of a group of units on one title with shared facilities. To protect ownership and to provide for the transfer of such a unit, ‘Company Title’ and ‘Cross Lease’ (or ‘Moiety Title’) schemes were established. These schemes use company and leasing law respectively to establish ‘ownership’ of units. The schemes are complicated and more difficult to understand than “normal” ownership under the Torrens title system. As a result many purchasers (and financiers) are scared off which can also have a significant negative effect on the price obtainable for these properties.


A nominated company is the sole registered proprietor (owner) of the land, with each unit owner having a share in this company via a share certificate. The company’s Articles of Association or Constitution set out the rules of the unit scheme, and are available from the Company’s secretary.

This share entitles the unit owner to the exclusive right to occupy their unit and access common areas such as driveways and stairwells.

When you purchase a property in a company title, the applicable shares for your unit are transferred to you, but there is no registration on the title to the land to evidence the ownership.

Often each shareholder is also a director of the company.

Some advantages of owning a company title are:

  • Generally not as expensive as a corresponding Strata or Community apartment;
  • Transfer of shares need to be approved by the Directors of the company;
  • May be easier to address any issues with other shareholders rather than a strata manager;
  • Most apartments are owner-occupier; and
  • Where renting is permitted, the rules may require that the tenant also needs to be approved by the company’s board.

Some disadvantages of owning a company title are:

  • Value may be depressed compared to a corresponding Strata or Community apartment;
  • May have difficulties in dealing with your preferred lender as some lenders are not prepared to lend as much compared with Strata or Community apartments;
  • Approval of a purchaser may restrict the size of your market; and
  • Be familiar with the Articles of Association or Constitution – failing to comply with any rules can have serious consequences.

Some other considerations when purchasing a Company Title apartment are:

  • Restrictions on transfers;
  • Do the Articles prescribe an interview for potential purchasers?
  • Is renting permitted?
  • Can any restrictions be placed on the tenant or tenancy itself?
  • How is the exclusive possession of the unit described?
  • What obligations do you have to make contributions? Is this at the discretion of the Directors?
  • What liabilities does the company have?
  • Is there adequate insurance over the building?
  • What provisions are there for maintenance and repairs?
  • What obligations are there for common areas, parking space, storage space and use of balconies?
  • Are there restrictions on advertising for selling or renting?
  • What is the extent of the Director’s powers?


These are also known as ‘less than entirety titles’ or ‘moiety titles’. Ownerships are evidenced by:

  1. Each unit owner owning a share of the land on the title (“less than entirety” title) on which the unit scheme is constructed; and
  2. Leases their unit and the rights of the common areas from the other registered proprietors of the land for themselves. This lease is registered over all the titles (if more than one), which jointly comprises the scheme.

The covenants of the leases set out the rules for such a home unit scheme. The owners collectively are considered the Lessors and the Lessee is the individual whose unit it is.

Disadvantages of Cross Leases:

  • The rights of the owner depend on the particular lease – usually arranged by a developer who built the development but has no further interest in it;
  • The term is usually 999 years, but usually the physical or economic life of the building is a lot shorter;
  • If you don’t comply with the covenants in the lease, the other unit owners may be able to force you to sell your share in the fee simple title;
  • If agreement can’t be reached to make any kind of decision for the common areas with other owners, lengthy arbitration may be required;
  • You will need the agreement of the other lease-holders before altering the unit, which may also involve additional surveying and legal costs;

Whilst Company Title and Cross Lease units may be cheaper they are more complicated to understand and transfer. A prospective purchaser can expect to pay significantly more for conveyancing fees but good advice and due diligence at this stage is a worthwhile investment! We have extensive experience in transfers of Company Title and Cross Lease ownership.

Company Titles and Cross Leases can be converted to a Community Title but the agreement of all unit holders will be required. Conversion to a Community Title scheme is an expensive process but may significantly increase the value of the property and simplifying future dealings with the units.

For further information please contact Anna on 8362 6400 or email Anna Pantelios. Join our mailing list to receive updates and advice on current issues.