Essential requirements of a lease

Question 1

What is a licence?

Answer 1

Personal premission to be on land

Question 2

How will courts determine whether there is a lease or a licence?

Answer 2

Substance not label

Question 3

What are the requirements of a lease?

Answer 3

• Certainty of term
• Exclusive possession
• Correct formalities

Question 4

What are the types of certainties of term?

Answer 4

Fixed
Periodic

Question 5

How may there be an implied periodic term?

Answer 5

look objectively at relevant circumstances including payment/acceptance of rent on periodic basis

Question 6

How is the length of the term calculated for periodic terms?

Answer 6

period which rent calculated

Question 7

What was the effect of the Prudential case and uncertain terms in leases?

Answer 7

Uncertain term may not be lease but an implied periodic tenancy may arise by virtue of possession and payment of rent

Question 8

What is exclusive possession?

Answer 8

Right to exclude all others

Question 9

What are the facts that indicate that there is not exclusive possession?

Answer 9

a) Landlord retains key and has right of access
b) Landlord provides services
c) Sharing clause
d) Landlord retains right to relocate tenant

Question 10

When will the courts be more likely to accept a licence rather than a lease?

Answer 10

Business tenancies

Question 11

What determines whether multiple occupiers hold a joint tenancy lease?

Answer 11

• Unity of possession: no exclusive use of any part
• Unity of interest: same term, same conditions, jointly liable for rent
• Unity of time: start at same time
• Unity of title: same document or separate but identical and interdependent

Question 12

If the four unities do not exist and neither do individual tenancies, where there are multiple occupiers what can there only be?

Answer 12

Individual licensees

Question 13

What are the factors that defeat a lease?

Answer 13

Intention to create legal relations
Service occupancies

Question 14

When may there be a lack of intention to create legal relations?

Answer 14

Family arrangement, act of friendship or generosity

Question 15

what may evidence an intention to create legal relations even where there is a family relationship?

Answer 15

degree of formality and/or market rent paid

Question 16

What is considered a service occupancy?

Answer 16

required to live in premises for better performance of duties as an employee

Question 17

If there is rent paid, will a service occupancy be a lease?

Answer 17

No

Question 18

What are the formalities for a legal lease?

Answer 18

Deed –
* Clear on face intended to be deed
* Validly executed
* Delivered

Question 19

Based on the term of a legal lease, how are the interests noted?

Answer 19

Over 7 years = registration
7 years or less = overriding interest

Question 20

What is the short lease exception for the formalities for legal leases?

Answer 20

lease 3 years or less need not be by deed where –
a) Takes effect in possession
b) Granted at best rent
c) Not subject to fine or premium

Question 21

What are the types of arrangements that fall into the short lease exception?

Answer 21

• Short fixed term leases
• Express periodic tenancies
• Implied periodic tenancies

Question 22

What are the formalities for an equitable lease?

Answer 22

• In writing
• Contains all agreed terms
• Signed by both parties
• Remedy of specific performance available