Essential Requirements Of A Lease

Question 1

What is a lease?

Answer 1

A lease is created when a landlord grants the temporary right to a tenant to use and enjoy land exclusively for a specified duration.

Question 2

How does a lease differ from a licence?

Answer 2

A lease confers exclusive rights to occupy land, while a licence grants personal permission to be on someone’s land.

Question 3

What are the key characteristics of a lease?

Answer 3

For a lease to exist, there must be certainty of term and exclusive possession.

Question 4

What is certainty of term?

Answer 4

Certainty of term means the tenancy must be granted for a specific duration, making it clear when the arrangement will end.

Question 5

What is exclusive possession?

Answer 5

Exclusive possession means the right to exclude all others from the property, including the landlord.

Question 6

What case established that substance matters over labels in lease agreements?

Answer 6

Street v Mountford [1985] AC 809 established that courts will look at the substance of an agreement rather than its label.

Question 7

What are the two types of terms that can demonstrate certainty of term?

Answer 7

Certainty of term can be shown through a fixed term or a periodic term.

Question 8

What is a fixed term lease?

Answer 8

A fixed term lease has a maximum duration known from the outset, such as a lease for 5 years.

Question 9

What is a periodic tenancy?

Answer 9

A periodic tenancy is a lease that continues indefinitely until either party gives notice to terminate, typically on a weekly, monthly, or yearly basis.

Question 10

What must formalities in a lease include?

Answer 10

Formalities are the rules that must be followed to create a legal estate, requiring a high degree of adherence.

Question 11

What factors may indicate a lack of exclusive possession?

Answer 11

Factors include the landlord retaining a key, providing services, or having a sharing clause.

Question 12

What is the significance of the landlord providing services

Answer 12

In Marchant v Charters [1977] 1 WLR 1181, it was held that if a landlord provides services, there is a licence, not a tenancy.

Question 13

What is the concept of joint tenancy?

Answer 13

In a joint tenancy, all co-owners are deemed to constitute one single entity and must hold the four unities: possession, interest, time, and title.

Question 14

What are the four unities required for a joint tenancy?

Answer 14

The four unities are unity of possession, unity of interest, unity of time, and unity of title.

Question 15

What can defeat a lease despite its characteristics?

Answer 15

A lack of intention to create legal relations or a service occupancy can defeat a lease.

Question 16

What is a service occupancy?

Answer 16

Service occupancy arises in employer/employee relationships where the occupier must live on the premises for job performance.

Question 17

What case illustrates the concept of service occupancy?

Answer 17

In Norris v Checksfield [1991] 1 WLR 1241, the court held there was no lease due to service occupancy as the driver needed the premises for job performance.

Question 18

What was the case focus of Norris v Checksfield?

Answer 18

A lorry driver claimed a lease of the premises he was occupying as part of his job.

Question 19

What was the court’s holding in Norris v Checksfield?

Answer 19

The court held there was no lease and it was a service occupancy because he required the premises for the better performance of his job.

Question 20

What was the case focus of Royal Philanthropic v County?

Answer 20

A teacher claimed he had a lease for a house near the school where he taught.

Question 21

What was the court’s holding in Royal Philanthropic v County?

Answer 21

The court held he had a lease because the occupation did not enable him to better perform his duties as a teacher.

Question 22

What is the key question to determine service occupancy?

Answer 22

Whether the employee is in occupation for the better performance of their job role.

Question 23

What is the general rule for creating a legal lease?

Answer 23

A deed must be used (LPA 1925, s 52).

Question 24

What is required for leases over 7 years?

Answer 24

The lease must be registered (LRA 2002, s 27(2)(b)(i)).

Question 25

What happens if a lease over 7 years is not registered?

Answer 25

A legal leasehold estate will not have been created (LRA 2002, s 27(1)).

Question 26

What is the requirement for leases of 7 years or less?

Answer 26

They do not need to be registered and will be binding on a new freehold estate owner as an overriding interest (LRA 2002, sch 3 para 1).

Question 27

What are the conditions for the short lease exception under LPA 1925, s 54 (2)?

Answer 27

The lease must take effect in possession, be granted at best rent, and not be subject to a fine or premium.

Question 28

What types of arrangements fall within the short lease exception?

Answer 28

Short fixed term leases, express periodic tenancies, and implied periodic tenancies.

Question 29

What is an equitable lease?

Answer 29

An equitable lease may be created if parties enter into a contract for lease or fail to create a valid deed.

Question 30

What must be present for a tenant to have an equitable interest?

Answer 30

There must be a document that complies with LP(MP)A 1989, s 2 and the remedy of specific performance must be available.

Question 31

What prevails in case of conflict between common law and equity?

Answer 31

Equity will prevail.

Question 32

What are the requirements for a lease term over 7 years?

Answer 32

Deed + registration.

Question 33

What are the requirements for a lease term of 7 years or less?

Answer 33

Deed; the lease will be binding as an overriding interest.

Question 34

What are the requirements for a lease term of 3 years or less?

Answer 34

No formalities required if it takes effect in possession, is granted at market rent, and no premium is payable.

Question 35

What happens if parties try to grant a legal lease but fail?

Answer 35

The tenant will have an equitable lease if the agreement is in writing, contains all terms, and is signed by both parties.