Landlord-Tenant (Leases) Flashcards
Lease
Gives the tenant (lessee) exclusive possession of the premises for a period of time (does not give title).
Creation of a Lease (SOF)
In general, a lease may be created expressly, either orally or in writing. But a writing is generally required by the SOF for a term of more than one year.
Implied Leases (Invalid Writing)
An implied lease may be created by the conduct of the parties when the written lease is an invalid writing. The resulting tenancy will be periodic.
Implied Leases (Holdover Tenants)
An implied lease may be created when a holdover tenant pays rent and the landlord (lessor) accepts the rent.
How to Approach a Landlord-Tenant Question
(Step 1)- Type of tenancy?
(Step 2)- What is the dispute?
(Step 3)- Has the LL/T transferred their interest in the property? (assignment v. sublease)
Types of Leases (TPAS)
Include:
- Term of Years
- Periodic
- At-Will
- Tenancy at Sufferance
Term of Years
Tenancy with a definite beginning and end (e.g. until a set date or for a set number of months or years).
Creation of Term of Years
Term of years is created by express agreement between the landlord and the tenant for a term specified in the lease. If the duration is for longer than a year, the agreement must be in writing.
Termination of Term of Years
Term of years is terminated automatically at the end of the fixed period. No notice is required.
Periodic Tenancy
Has a set beginning date and continues from period to period (e.g. month to month) without a termination date, until proper notice is given.
Creation of Periodic Tenancy
A periodic tenancy is created expressly or by implication with a holdover tenant.
Termination of Periodic Tenancy (Notice)
The landlord or the tenant must give appropriate notice of intent to terminate:
Periodic Tenancy: Appropriate Notice
Notice must be in writing if the lease or state statute so specifies, otherwise it can oral (and equal to the rental period, up to a maximum of six months). E.g. one-year tenancy = 6 months’ notice.
Periodic Tenancy: Date of Termination
The modern/majority approach is that notice can take place on any date (but it does not take effect until the start of the next rental period). The CL/minority approach is that notice has to be given at the start of the rental period.
At-Will Tenancy
Has no fixed duration and lasts only as long as the landlord and tenant desire.
Creation of Tenancy at Will
Tenancy at will is generally created by express agreement of the parties.
At-Will Tenancy: When Tenancy Terminates
The at-will tenancy terminates if:
- Freely as soon as either party decides
- Either party dies
- The tenant commits waste
- The tenant attempts to assign his interest
- The landlord transfers his interest
- The landlord transfers the premises to a third party for a term of years
When a Lease Gives a Landlord a Unilateral Right to Terminate
Most courts find a tenancy at will that may be terminated by either the landlord or the tenant.
When a Lease Gives a Tenant a Unilateral Right to Terminate
Most courts find that the tenant receives either a life estate or fee simple (depending on the language). Although a few courts find a tenancy at will that may be terminated by either the landlord or the tenant.
Tenancy at Sufferance (Holdover Tenant)
- A tenancy at sufferance occurs when a tenant remains in possession of the leased premises (“holds over”) after the end of the lease term.
- In most states, if a residential tenant holds over, the landlord may recover possession and receive the reasonable rental value for the holdover period.
Holdover Tenants: Distinguishing Between Periodic Tenants and Tenants at Sufferance
What type of tenancy is created will depend on the landlord’s actions
- If the landlord wants the tenant to remain on the land (evidenced by accepting rent) the tenant becomes a periodic tenant
- If the landlord does not want the tenant to remain on the land (does not accept rent), the tenant becomes a tenant at sufferance until the landlord can get the tenant off the property.
Holdover Tenants: Determining Period Length for a Periodic Tenancy
If the tenant becomes a periodic tenant, the period is determined by the type of jurisdiction.
- CL- the length of the expired lease, with a maximum of one year
- ML- treat the period as the period for which rent is reserved.
Tenant’s Duties
Include:
- Pay Rent
- Avoid Committing Waste
- Render Repairs
Duty to Pay Rent
A tenant has a duty to pay rent. But the tenant is relieved of this duty if all or a portion of realty is destroyed (unless tenant intentionally or negligently caused the destruction).
Duty to Pay Rent: Term of Years
The tenant is liable for all unpaid rent in the lease.
- CL rule- the landlord could only sue for rent as it accrued
- ML majority rule- allows for anticipatory repudiation but the landlord has a duty to mitigate (make reasonable efforts to re-rent the property).
Duty to Pay Rent: Periodic Tenancy
The tenant is liable for the rental obligation up until proper notice is given to terminate the lease.
Duty to Pay Rent: Tenancy At-Will
The tenant is liable for the amount of rent stated in the agreement that is already owed.
Duty to Pay Rent: Tenancy at Sufferance
The tenant is liable for the reasonable rental value of the property.
Tenant Defenses to Paying Rent
Include:
- Failure to Deliver Possession
- Tenant has Been Evicted
- Tenant Surrenders Premises to Landlord
- Destruction
- Warranty of Habitability
Duty to Deliver Possession
- Majority (English) rule- the landlord has an obligation to deliver possession of the property to the tenant
- Minority (American) rule- the landlord has no obligation to deliver possession of the premises; the tenant must take it.
Tenant Evictions
If the tenant has been evicted, it is an excuse for not paying rent. Includes actual eviction and constructive eviction.
Constructive Eviction
- When the landlord has allowed the condition of the premises to deteriorate to the point that the tenant is essentially being forced out (the use and enjoyment of property is substantially interfered with).
- However, remember that the tenant must actually move out within a reasonable time following the acts constituting the substantial interference.
Constructive Eviction by a Third Party?
Even if the acts constituting the substantial interference are due to third parties, the landlord can be liable because the landlord should have had reason to know that the interference would cause a constructive eviction.
Tenant Surrenders Premises to Landlord
In order to claim this defense to paying rent, the landlord must accept the surrender and retake possession of the premises.
Destruction
- Under the CL, destruction generally did not excuse payment of rent because the tenant was still in possession of the actual land (unless T leased only a portion of a building)
- Under the ML, no distinction is drawn between leasing all or a portion of the building. Destruction will be a defense to payment of rent (unless tenant intentionally or negligently causes the destruction).
Duty to Avoid Committing Waste
Is the same as that for life tenants (remember permissive waste, voluntary waste, and ameliorative waste)
Permissive Waste
Unlike a life tenant, a lease tenant’s duty to avoid waste is not limited to the extent of income derived from or the reasonable rental value of the property.
Ameliorative Waste
Under the modern view, a tenant may commit ameliorative waste if:
- Expressly authorized; or
- There is a change in circumstances that warrants the improvements to be made (if improvement does not depreciate property value)
- Otherwise the lease tenant will be liable.