Commercial Tenancies Flashcards
When a tenant has a lease, what does the landlord have?
the landlord has a reversion - the right to retake the land when the tenant’s estate ends
What is a lease?
also called ‘demise’ or ‘demised interest’ - A lease grants the absolute rights of possession for a definite period of time
How are leases created?
They are created by contract (either express or implied)
How did Highway Properties change the relationship between leases and property law?
Highway Properties says that even after possession, some aspects of contract law still apply - a commercial lease is treated as both a conveyance and a contract
What is the difference between a lease and a license
if the agreement does not grant exclusive possession for a definite period of time, it is a license
at common law a license is revocable at any time by the licensor, not true of leases
True or False: the rights to a lease are inheritable?
True, interests in a lease are alienable and therefore inheritable, but often they are too short to be inherited
What is a license?
A license is the permission to use land for some purpose without certainty of duration
it is revocable at any time by the licensor
True or False: In deciding if a lease exists, it is the intention of the parties that matters?
This is one of the approaches to a lease: focusing on the intention to create the landlord/tenant relationship. This is the approach used by the courts (what the document SAYS)
Other approach is to focus on whether the agreement grants exclusive possession (what the document DOES)
What is a covenant?
a term in the lease outside of the grant of land that usually involves an agreement to undertake certain duties
Define independence of covenants
the failure to perform a covenant dos not give a right to terminate the lease, nor the right of re-entry to the landlord
What is a conditional covenant?
A term in the lease that, if breached, allows for termination
e.g., rent - but by statute this is a condition with a grace period of 15 days (not a covenant)
CHECK THIS WITH PHILLIPS???
True or False: a tenant can terminate a lease by abandoning the premises?
False, if a tenant abandons the premises they are still responsible for rent
If a tenant abandons the leased premises, does the landlord have a duty to mitigate their damages?
No, there is no duty to mitigate - the tenant is on the hook for the whole lease unless the landlord finds a new tenant
Why does the landlord finding a new tenant (after the original tenant abandoned the premises) terminate the original lease and release the original tenant from liablity?
if the landlord gets another tenant then someone else has been granted exclusive possession and the original tenant’s duties are relieved
If the tenant abandons, are they immediately liable for all of the rent due?
No, the tenant is not liable until the end of the term - you can’t say they haven’t paid until they haven’t paid
How can a lease be ended early?
A surrender is required to end a lease early
What is a surrender?
a bilateral agreement to end the leasehold relationship and revert possession to the landlord - landlord HAS to agree
if a surrender occurs, the tenant is relieved of their liability for the remainder of the lease
Importance of MetroMatic?
(lease of laundry room in building)
illustrative of the courts looking to the intention of the lease agreement - it conferred exclusive possession and control of the premises and so was a lease
What are the mechanisms of surrender?
1) acts of the parties: parties explicitly agree
2) operation of the law: parties participate in a course of action inconsistent with the continued existence of the lease -> implied surrender
i) acceptance of a new interest by the lessee
ii) acceptance by possession of the landlord (landlord re-enters with intention to possess OR signs a lease with a new tenant)