- Length:14 pages (5200 words)
- Available in:Microsoft Word DOCXApple PagesRTF
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About this agreement
This lease sets out the terms under which you will let out spare plant and machinery to another business. It can be used for a short term - a few weeks, or long term, measured in years.
Using this template, your lease could be for a fixed term or on a rolling basis. We include the option for your lessee to purchase the machine after a certain time. That is to say you can make it a finance lease or an operating lease. There are no legal constraints in what deal you want.
As with all Net Lawman documents our drafting notes will guide you what you can change safely, and what we suggest you should not change.
The law in this document
The contract has been drawn for a lessor who is not in the business of leasing to consumers. That is to say, the lessee or hirer must be a company or person in business.
The Personal Property Securities Act 1999 and other law relating to consumer credit and protection law is therefore not required.
The advantage of not having to take account of this law is that you are free to make the deal you want without having to look over your shoulder at government regulations (although, of course, there is a raft of legislation about operation of almost any machine). To make your life easy, we have provided multiple options in many areas including: responsibilities for maintenance, payment of the lease rent, options for buy-out at the end of lease, options to extend the lease and much more.
This agreement is a real, full legal document. It covers every reasonable angle, providing both a statement of the commercial terms and a very firm basis of rights of both parties, but principally to protect the owner of the machine or plant.
This document might be used in situations such as:
- A sole trader (such as a builder) leasing spare equipment to another sole trader or business for a single job.
- A business leasing unused plant to another business for a long term contract.
Examples of the type of plant that could be leased using this document include:
- a crane
- a cherry picker
- a dumper truck
- a roller
- an excavator
Important to this agreement is that the plant is movable and will be stored under the control of the lessee.
This agreement is extremely comprehensive and written in plain English. It has been drawn for maximum flexibility and ease of use.
Key features are:
- The term of the lease can be as long or short as you like, from months to years. We suggest a short period so that the contract can be renewed and terms (such as the rental amount) updated.
- The document allows use of several schedules to record the detail of the agreement. This keeps the "legal" wording of the commercial transaction separate to the "subject matter", creating an agreement that is easier to read, amend and reuse.
- Options for rent and payment plans. The rent might be a simple monthly or annual payment or may be variable.
- The buy-back arrangement is an option you can include or delete.
- Options for lease rentals
- Full description of the machine - subject matter of lease
- Warranties and exclusion by lessor
- Testing and checking of machine by the lessee and conditions of acceptance
- Prohibition on selling and subletting
- Termination and premature termination and its consequences
- Optional provision for deposit by the lessee of additional security in cash or goods
- Option of guarantor
- Repair and maintenance terms
- Insurance: lessee insures in name of the lessor
- Buy-out provision
- Option to extend lease term
- Lessor’s right to inspect machine during lease and many other strong provisions on lessor’s rights
- Set of lessee’s obligations
- Lessee to indemnify lessor
- Other important legal and commercial provisions
Alternatives to this document
Net Lawman has more suitable documents if you are leasing: