leaseholds Flashcards
what does the landlord transfer in a leasehold
transfers a present interest in a leasehold estate to a tenant; the landlord retains a future interest known as a reversion, which becomes a present interest once the leasehold estate ends
what are the types of leases
terms of years
periodic tenancy
tenancy at will
tenancy at sufferance
what is a Term of years lease
a lease for a definite term
It must have a definite beginning and end date. The end date of the lease must be either stated or calculable based on the lease’s description of the terms
what is a periodic tenancy lease
a lease in which the terms consist of successive periods, such as a month to month or year to year
It continues indefinitely (ie automatically repeat) until either the landlord or the tenant provides notice of termination
what is the rule for notice of termination for periodic tenancy leases
The notice must be equal to the shorter of a full period or 6 months
if its a lease that renews every four months, you give notice four months out OR six months, whichever is shorter
So pretty much you cant give notice in the middle of the period
what is the rule for notice of termination for terms of years leases
the landlord or tenant dont have to give notice for termination because we know when the lease is going to terminate
what is a tenancy at will lease
a lease without any definite terms; either the tenant or the landlord may cancel the lease at any time
what is the rule for notice of termination for a tenancy at will lease
Termination is at the will of either party
Many jurisdictions require at least 35 days notice to invoke the cancellation right
what is a tenancy at sufferance lease
not really a lease, but It occurs when a tenant stays on the property longer than the term of the og lease
This tenant is called a hold over tenant
The landlord may either evict the tenant and receive damages or compel the tenant to lease for a successive term
if the person has a right to a specfic area, is it a lease or a liscence or easement
prob a lease
how much control does the person have of the area (ie to determine if its a lease or license)
full=prob lease
Particular use= easements/
if the rights are borader is it a lease or liscence or easement
lease
how long is the duration(in terms of lease or liscence or easmennt)
If its definite= easement(these can also go on into perpetuity too)
Really short= most likely a liscense
when must a lease be written according to sof; and what happens if they arre not in writing but need to be
when they are longer than a year; leases that purport to be longer than a year but are not in writing result in a tenancy at will – ie either party may terminate the lease at will
what are the obligations that a tenant has
At common law, a tenant has an obligation not to commit waste on the property
The tenant is liable for only voluntary waste
but when in doubt, know that the lease controls
who is the lessor and lessee
lessor – landlord
lesssee -tenant
but to avoid confusion just do landlord/tenant language
can the tenant committ permissive or ameloirative waste?
when in doubt the lease controls, but if the lease is silent
ameiloritve = prob not just because even though it might raise the value it still has to go back to the landlord
permissive – not possible because tenant isnt obligated to make repairs unless the lease says otherwise
Freehold investments v richstone: landlord tries to evict tenant after he installs new cabinets
FACTS
The lease prohibits any alterations without the consent of the landlord and specifies that even papering the walls or changing the color of the wall paint is a prohibited alteration
The tenant removed and replaced a series of wall cabinets
ISSUE
Was the tenant’s actions a violation of the lease?
Did it constitute a waste?
Majority looked at the language of the lease
Even if its raising the value of the property, cant commit ameliorative waste
Dissent
Thinks landlord is trying to terminate lease because tenant is a statutory tenant
Usually ameroltative waste is a structural alteration, and the change here was non structural
If the lease had been silent to alteration, dissent might have won
what is a statutory tenant
A statutory tenant is a tenant whose lease begins according to normal rules of law, but whose tenancy continues because of legislative action (such as rent control)
what are the landlord obligations
duty not to discriminate via the fair housing act, delivery of posession, and that the leased premises are in a condition suitable for the tenants use
when does the duty to discriminate not apply
- when it is a single family house – if the owner does not own more than three houses at a time and they are not using a real estate broker to sell or rent
- owner occupied units where no more than four families live
Jancik- discriminatory landlord gets busted in a sting;
evidence of intent to discriminate in the rental of housing will support a conclusion that an ad for housing violates the fair housing act even when discriminatory intent is not explicitly stated in the ad
Glover- landlord discriminates on the basis of family composition
familial status is also a protected class that cant be discriminated against
what does a landlords duty to deliver posession of the premise depend on
depends on whether we mean legal possession or physical possession, and it depends on which jurisdiction we live in
does a landlord have the duty to deliver legal possession
At the beginning of the lease, a landlord has a duty to deliver the legal right to possess the property
This means that no meritorious legal claims to possess the property can be asserted against the tenant. No one else can assert a superior right to occupy the premises.
what is legal posession
legal right to be there
what is physcial posession
ability to enter on the premise
what is the english rule (majority)
a majority of state follow the English rule, which imposes a duty on the landlord to provide actual physical possession to the tenant on the first day of the lease
A landlord never is liable for a trespasser who begins trespassing AFTER the first day of the lease
what is the american rule
a minority of states follow the American rule, which imposes no duty on the landlord to provide actual physical possession
what is the remedy for failure for landlord to deliver physcial premise
If a landlord breaches this duty to provide possession, the tenant may repudiate the lease or recover damages
can you contract around the duty of the landlord to deliver posession
American rule jurisdiction allow a tenant to contractually require the landlord to deliver physical possession
English rule jurisdictions vary: some jurisdictions allow the tenant to waive this right (meaning that the landlord can contract out of his obligation to deliver
adrian v rabinowitz
D leased to P certain store premises in the main business district for the term of six months
The gravamen of this action is the breach of an obligation thereby imposed upon the lessor, to delivery of to the lessee possession of the demised premises at the beginning of the term so prescribed
At the time of the execution of the k, the premises were tenanted by another, who failed to respond to the landlord’s notice to vacate in June
The landlord instituted dispossess proceedings, which terminated in a judgement of removal
The judgment was executed on July 7 and the p moved in two days later
ISSUE
Whether, expressly or by implication, the contract imposed upon the lessor the duty of putting the lessee in actual and exclusive possession of the demised premise at the beginning of the term
yes; court pretty much explains that the english rule is better because it makes sense for the landlord to be responsible for dealing with holdover tenants
what are the two doctrines associated with a landlords obligation to ensure that the leased premises are in a condition suitable for the tenants use
the covenant of quiet enjoyment and the warrant of habitability
when is the legal possession obligation violated
not until somone brings a challenge that is sucessful
what are the three ways the covenant of quiet enjoyment can be breached
complete physical eviction, a partial physical eviction, or a constructive eviction
what is a complete eviction and what are the remedies
occurs when the tenant cant gain physical possession of the leased property because of landlords wrongful action/inaction
The tenant is not obligated to pay rent, may terminate the lease, and may recover damages
what is A partial physical eviction
occurs when a tenant can’t gain physical accesses to a part of the leased property because of landlords wrongful action/inaction
The tenant may abate rent, and in some jurisdictions, the tenant may terminate the lease
what is a constructive eviction
occurs where a landlord’s wrongful conduct has substantially interfered with the beneficial use and enjoyment of the premises, causing the tenant to vacate the premises.
The tenants vacation terminates the lease, and the tenant is not liable for any remaining rental payments
The tenant may also recover damages
what happens if substantial interference occurs but the tenant does not vacate the premises
the tenant may not terminate the lease under the doctrine of constructive eviction
what is substainial interferece with beneficial use and enjoyment (via the constructive eviction def)
because of the conditions that result from the landlords wrongful coduct, it makes it so that its interfering with the purpose of the lease , even though they can physically be there
what is wrongful conduct (via the constructive eviction def)
when the landlord acts or fails to act where there is a duty to act
what does a teanant need to do to officically vacate the premise via the constructive eviction
they must terminate the lease with ZERO intention to return
Brugger v Fonti: lessees claim constructive eviction after loud disco and sewer probs
The defendants complained that the disco music was loud and interfering with their business and attacking undesirable people who would loiter in the common hallway
Ds also complained of a sewer issue and a hole in the wall
Ds complained to the P about the same problems that had previously existed
P corrected the sewer problems and arranged to have the noise from the disco reduced
P also hired a security guard
Sometime in august of 1979 the exhaust fan in kitchen of the restaurant broke causing smoke to fill the building
P replaced the fan asap, but the restaurant had to be closed over a weekend
After this, the Ds QUIT THE PREMISES, claiming that the problems mentioned above had proved fatal to their business
They were then behind on their rent hand had not paid the utility bill since April
P sued in an action for breach of lease and damages
D claim that they were constructively evicted from the premises as a result of the disco noise, lack of maintenance and associated problems
ISSUE
Were the D’s constructively evicted from their rental?
No;A tenant must however, abandon the premises within a reasonable time AFTER THE ALLEGED INTERFERECE
The record shows that Ds first complained of the disco noise and other problems in January but didn’t leave until august
Additionally, where the maintenance problems were remedied within a REASONBLE TIME, constructive eviction does not occu
Barash v PA Terminal Real Estate: landlord of highrise building cuts off the A/C
The lease said that the landlord will furnish air cooling during June-Sept on business days from 9-6
P took possession and on that same day in the evening, at 6 D turned off all the air and by 7 the heat became unbearable
D would only put the air on after hours for an extra fee, which p refused to pay
P sued and D sought dispossession for the nonpayment
ISSUE
Whether landlord’s allegedly wrongful failure to supply a continuous flow of fresh air on evenings and weekends to offices leased by tenant constitutes a partial actual eviction reliving tenant from the payment of rent or, at the most, a constructive eviction requiring the tenant to abandon the premises before he may be relived of the duty to pay rent
Because the eviction, if any, is constructive and not actual, the tenant’s failure to abandon the premises makes the cause of action insufficient in law
To be an eviction, constructive or actual, there must be a wrongful act by the landlord which deprives the tenant of the beneficial enjoyment or actual possession of the demised premises
However, a right to 24 ventilation cant be established in the absence of changing the lease
An actual eviction happens when the landlord wrongfully ousts the tenant from PHYSCIAL POSESSION of the leased premises
THE TENANT, HOWEVER, MUST ABANDON POSESSION IN ORDER TO CLAIM THAT THERE WAS A CONSTRUCTIVE EVICTION
what is the implied warranty of habitablity (IWoH)
requires a landlord to ensure the clenliness, saftey, and fitness of the premises – sufficent for human habitation
the landlord must be give an opportunity to correct a problem that would otherwise violate the IWoH
only some jursidctions follow this
can the implied warranty of habitability be waived?
no, most jurisdictions wont allow this
hilder v st. peter – slumlord
the case where everything that could be wrong was wrong; garbage all around, sewage problems, no lock on thr door
was there a breach of the implied warranty of habitiblity?
yes; it was more than simple wear and tear and the fact that there is someone breaching any housing codes show a potential breach of implied warranty of habitabilty
what is the common law rule about a tenant transfering their interests
a tenant may transfer her interest without consent from the landlord
However this rule is only a presumption: in the OG lease between the tenant and the landlord, the landlord may contractually require the tenant to obtain the landlord’s permission before the tenant assigns or subleases her interest
Hence, the common law rule that allows tenants to transfer their interest in leases represents the rule that applies ONLY IF the lease is SILENT on the issue
what is the common law rule for the tennat being able to transfer their interest with a commercial lease
In the commercial lease context, where a lease states that a tenant must obtain the landlord’s consent before assigning or subleasing her interest, the landlord may not withhold consent unless he has a commercially reasonable basis for doing so
what are the two situations where the second tenant is directly liable to the landlord for that rent
- where there is privity of contract or
- where there is an assignment
explain privity of k that would make the second tenant directly liable to the landlord for the rent
if the second tenant has agreed by k with the og tenant (or with the landlord) to pay rent directly to the landlord, the second tenant is contractually liable to the landlord for the rent
what is an assignment (ie one of the situations that would make the second tenant directly liable to the landlord for the rent)
occurs when a tenant transfers the ENTIRETY of the remaining duration of her lease to the second tenant (the assignee)
ie The landlord’s possessory interest immediately follows the possessory interest of the assignee
In an assignment, even if the assignee has not agreed by k to pay rent to the landlord, is the assignee liable to the landlord for rent if the og tenant fails to pay rent
yes
how do we know if the real covenant to pay rent run with the land in the assignment context
what about equitable servitude
- intent – was there an intent for the promise to apply to sucessors (as betwen the og tenant and landlord) – there is a presumption that if assigned, new tentant obligated to pay rent
- touch and concern? – paying rent usually does
3.privity of estate? horizontal and vertical? – depends if the sucessor took the full estate via an ASSIGNMENT and not a sublease!
horizontal is about the landlord transgering a leasehold to the og tenant along with the og covnenat to pay rent
equitable seritue – same intent and touch and concern as real covenant, and element three is notice
how do you know if youre doing an equitable servitude analysis or a real covenant analysis?
you have to understand what the landlord is trying to do
if they are tying to get rent – real covenant
if they are tyring to kick them out – equitable servitude
who is remains liable under the og lease to the landlord, (via k law) REGARDLESS of whether the second tenant is in either privity of estate or privity of contract with the landlord
the og tenant
when doing an analysis in terms of the og tenant, do you need to prove that it runs with the land via the intent/touch and concern etc?
no! you just need to prove they breached the lease via the writing, the other analysis is reserved for any SUBSEQUENT tenant!
what are the differing approaches in terms of material breach vs a non mateiral breach of the second tenant so the land lord can kick them out
material breach= dont need to go through equitable servitude, the land lord can just temrinate
non material = go thorugh the equitable servitude analysis
what is a material breach of the lease vs non material breach of the lease
material= covenant to pay rent is always material
nonmaterial= covenant to repair
ernst v conditt – assignment or sublease? the go cart case
condit argues it was not an assignment because rogers still holds some interst in the land
also aruges that because the word ‘sublease’ was in the agreement, it couldnt be anyhing more htan a sublease
assignment; just because an agreemtn calls something a sublease/assignment dosent mean thats what it is; look to what the lang is acutally conveying
The fact that the lease included a clause that Rogers remained liable under the terms of the lease did not create any right of re-entry or reverter, although it did mean that Rogers remained liable in the event that Conditt defaulted on his obligations
what is a sublease
when a tenant transfers LESS THAN THE REMAINING DURATION OF HER LEASE TO THE SECOND TENANT (the subleasee)
The second tenant IS NOT in privity of estate with the landlord because their respective estates (the leasehold estate of the assignee and the freehold estate of the landlord) ARE NOT successive in time
why is it important that we know if its an assignment or a sublease?
because with a sublease you are not obligated to pay the landlord rent(unless you k to do so) and an assignment you are obligated to pay the rent (all in terms of being the second tenant)
what is a novation
a contractual release of obligations under the og lease
Such a novation would not release the assignee of his obligation to pay rent
nexsen v haddock – can a tenant sublease without the landlord’s consent?
in south carolina, absent the landlords wirtten consent, the sublease will be seen as null
what are the four topics in term of lease termination
self help remedy of eviction, retalitotry eviction, abandoment, and mitigation of damages
what is the self help remedy of eviction and what are the two appraches
a land lord can evict a tenant for nonpayment of rent or for other material breaches. at 1. common law, the landlord can unilaterally act to retake possession of the premise
- the modern approach: some jurisdictions require a judicial order to physically evict a tenant because of the uneven power dynamic in the common law approach
what is needed under commmon law self help remedy to evict a tenant
- landlord legally entitlted to take back posession
- the landlords means of retaking are PEACEABLE
berg v wiley – a family affair restaunt case; landlord changes the locks on tenant’s building
the landlord takes reposession while the tenant is not there via changing the locks
did the landlord renter the premise forcibly and wronfully as a matter of law
the court says it could have got violent via the history of animosity between the parties and said it failed under the common law approach because of this
what is retaltiory eviction amd which leases do they apply to
applied to periodic tenancy or tenancy at will
whne the landlord decides to terminate the lease for the reason that the tenant has excerised their rights
this is not allowed
jurisdictions usually have a set time period where if the landlord terminates, its deemed to r
what are some examples of relatitoy eviction
reducing funcitons so the tenant leaves, rasing the rent after the tenat excerssies their right, and obviously eviction
does relatitory eviction apply to a term of years lease
no, because thats the lease that has a definite end time and cant be terminteed before that
is there a time period that an eviction will be deemed retaliatory?
jurisdictions usually have a set time period where if the landlord terminates, its deemed to retalitory
if the eviction comes outside of that time period, tenant has the burden to show it was retalitory eviction
gokey v bessete: the mobile home case; landlord evicts tenant after tenant complains about sewer line
during the lease time between the parties, there was a water leakage into the tenants home, power failures, and a faulty sewer line
the tenants stoped paying rent, and then the landlord locked the barn where the freezer was, causing a loss of food
the landlord then termintated the lease and aruged no retalitaion because the eviciton was because the tenants stopped paying rent
issue: in looking at why a landlord ended the lease via retalitory, should the court take an objective apporach (ie looking at the facts) or a subjective (seeing what the landlord was thinking)
objective! because the termination was within the jurisdictional time period, court deemed it was objectively retaltioy
whats going on inside a landlords mind does not matter
what is abandoment and what must a tenant do to abandon
when tenant leaves with no intent to return
to abandon, a tenant must
- vacate the premise without justification
2.lack present intent to return to premise and - default in payment of rent
what does abandonment by a tenant represent
an offer of surrunder
what can a landlord do if a tenant abandons the premise (three options)
- mitigate damages by reletting premise to a new tenant
- leave premise vacant and sue tenant for rent accured
- terminate the lease, and therefore accepting the offer of surrender
what happens if the landlord accepts the tenants offer of accpetamce after they abandon
the landlord cant recover any damges beyond the time of that acceptance
accpetance of the offer releases the tenatn of any obligation to pay rent
what happens if a land lord rejects a tenants offer of surrender
the tenant continues to be liable until the premises is re-let or the og lease term ends, whichever occurs first
what do most jurisdcitions say about the landord option to leave the premise vacant and sue tenant for rent accured in response to tenant abandoment
most jurisdicions have rejected it, espcieally in the residential context
what does it mean for the landord to mitigate damages when a tenaant abanonds (ie its the maj rule)
once a tenant abandons the property, the landlord must make reasomble efforts to re-let the property, and failure to mitgate limits the amount of damages that a landlord may claim
sommer v kridel: tenant abandons property after wedding falls through
tenant goes into posession expecting to be married but the wedding falls through, and he tries to get out of the lease
after tenant vacates, someone tries to rent, but landlord wont let them see it and then later the ll tries to recover for the full amount of rent accured
issue: did the ll properly mitigate damages>
no; he should have allowed that person to see the premise
a landlord has an obligation to make a reasonble effort to mitigate damages in this siutaiton
how do courts want landlords to treat abaonded premiese
like vacated apartments; the landlord nees to show that he excersied reasonable diligence to relet the abandoned premise
holy properties: commercial tenant abandons lease
the tenant that defaulted was a commerical tenant
the landlord didnt mitgate damages via reletting the property
issue: does a landlord have a duty to mitigate commercial tenants abanoment
not necisarily; in the commerical context, some jurisdictions wont require the ll to mitgate
they use a certainity rationale; in business transactions, the certianitu of settled rules is often more important than whehtehr the established rule is better than another or even whehtr it is the correct rule
