Most residential blocks like Augustus Court are set up on a two-tier system with two principal elements - the freehold and one or more leases.   The holder of the freehold (the freeholder) owns all the land bound by the records defined by the Land Registry and any structure(s) built on that land.  Following the redevelopment of the main building in the late 1980s, leases were drawn up - one for each of the fifteen resulting units - and sold, each lease giving the purchaser the temporary right (the leasehold) to occupy that part of the building defined within that particular lease as a self-contained unit and for up to a defined period of time.   This period was set originally as 125 years from 1987.   As the lease is a legal document relating to property ownership it can be bought and sold on the open housing market.

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The lease is also a contract between the leaseholder and the freeholder.  It contains definitions of benefits and a list of terms and conditions (covenants) with which the leaseholder must comply.   One of the benefits, for example, is that each lease includes the allocation of one defined parking space within the car park.   An example of one of the covenants is the requirement for the leaseholder to seek the freeholder’s written authority before sub-letting or putting the lease up for sale to another purchaser or some other transfer of ownership.