Chapter 6 - Leases

Question 1

Is a lease capable of being legal?

Answer 1

A lease is capable of being legal estate in land s1(1)(b) LPA 1925- a term of years in absolute in possession

Question 2

what are the formalities required for a lease for more than three years?

Answer 2

• a deed (s52 LPA 1925) . the deed must meet the criteria set out in s1 LPMPA 1989
• ( It must be in writing , clearly stated that it is intended to be a deed , it is validly executed as a deed).

Question 3

what are the formalities for a lease of three years or less?

Answer 3

some require no formalities . they are called ‘parol leases’. these can be created orally.

Question 4

what requirements must be satisfied for a parol lease to be legal?

Answer 4

a)the lease must be for three years or less

b) must take in effect in possession.( tenant must have the immediate right to possess and enjoy the land

c) tenant pays best rent which could be reasonably obtained (market rent)

d) The landlord must not charge a fine or premium. This is a one-off capital sum. For example, granting the lease for £5,000. This premium could be paid instead of rent

Question 5

can leases for three years be created by deed?

Answer 5

• yes

Question 6

in what situations will equity intervene to recognise an equitable lease?

Answer 6

this will happen where the correct formalities for the creation of a legal lease has not been followed.
equity will intervene in two circumstances:
a) where there is a contract to create or transfer a legal estate
b) where there is an attempt to use a deed is not valid.

Question 7

what are the requirements for equity to recognise the arrangement where there is a contract to create or transfer a legal estate?

Answer 7

• a contract
• complying with s2 LPMPA 1989
  -clean hands.
  this is known as the doctrine in walsh v lonsdale

Question 8

what is an estate contract?

Answer 8

• arises from a contract to transfer an existing legal estate

Question 9

what criteria needs to be satisfied for an equitable property right to arise after parties fail to make a valid deed?

Answer 9

• a contract
• complying with s2 LPMPA 1989
  -clean hands

Question 10

what are the essential characteristics of a lease?

Answer 10

1. the estate must be for a duration permitted for a leasehold estate
2. the grant must give exclusive possession
3. the grant must have the correct formalities

Question 11

what is created instead if one or more of the essential characteristics of a lease is missing?

Answer 11

A licence

Question 12

what are the difference between a lease and a licence?

Answer 12

lease: proprietary right in land that can bind purchaser of the reversion (freehold estate)
- can be assigned to a new tenant (bought and sold) and lease continues to exist
- An occupier with the benefit of a lease may benefit from a range of statutory protections

Licence: creates a personal right that will not bind the purchaser of the reversion

• A licence cannot be assigned and a new license is required if the identity of the parties to the licence changes
• Licensees in occupation do not benefit from statutory protection.

Question 13

Explain the permitted duration requirement

Answer 13

• a lease must have a definable beginning and a definable end
• can be fixed or periodic

Question 14

what is the effect of a creation of a lease for life?

Answer 14

creation of a lease for a term of 90 years ending on the death of the tenant (or as otherwise provided for in the agreement)

Question 15

what is a break clause?

Answer 15

a contractual right to bring the lease to a premature end

Question 16

explain the exclusive possession requirement

Answer 16

• must have exclusive possession, anything less with create a licence

definition :
- the tenant can exclude all from the land
- does not need to be in occupation to enjoy exclusive possesion