Leases Flashcards
Formalities to create a lease
If 3 years or less then parol lease and no formalities
If more than 3 years need a deed for a legal lease
Can a lease be created orally
Only a parol lease
When can a lease be equitable due to failure of formalities
Contract to transfer land
Attempt to create a deed but not valid so find a contract
Essential requirements of a lease
Specific duration
Exclusive possession
Correct formalities
Is rent necessary to create a lease
No
Can a license be assigned
No
Can you create a lease for life
No this would create a lease for 90 years ending on death of tenant
What is a break clause
A fixed term tenancy with a contractual right to bring it to an end
When does T have exclusive possession
When in general control even if contract tries to exclude it
Is a lease created if employer lets employee live with them
No just a licence
Can a legal periodic lease be inferred
Yes
Is a parol lease legal or equitable
Legal
Implied covenants
Quiet enjoyment and fitness of property
What is quiet enjoyment
Ts possession of land will not be substantially interfered with by acts of L
Can L interfere with Ts peace or comfort to encourage them to leave
No this is an offence
Ls obligations re dwelling houses
Keep on repair structure, exterior and installations of water gas electric sanitation and heating
Alienation meaning
Disposal of existing leasehold
Can T assign lease
Absolute prohibition - no
Qualified prohibition - need consent
Fully qualified prohibition - need consent which cannot be unreasonably withheld
Can there ever be a qualified covenant against assignment, under letting, charging, or parting with possession
No because LTA turns it into a fully qualified covenant
Enforcement of covenants in leases before 1Jan 1996
Contract may bind successors. If not:
Old T: privity of contract. Remains liable for burden until end of lease even after asignment. Gives up benefit
New T- privity of estate. Liable for covenants that touch and concern the land.
New L: liable for covenants that touch and concern the land
L can pursue old T, new T or both
Old T can sue new T under common law, indemnity or implied indemnity
Enforcing covenants under leases created post 1 Jan 1996
New T and Old T liable for benefit and burden (unless personal) only while lease is vested in them and then automatically released. L can only pursue current T
New L subject to benefit and burden (unless personal)while holding freehold and then must apply to be released or can put in contract that no longer liable when not holding freehold. Otherwise T can pursue old L and new L or both
What is an authorised guarantee agreement
Agreement between L and outgoing T than L can hold Outgoing T liable for breach of covenant by new T
What remedy can L have if new T is bankrupt and disclaims lease
Can require old T to enter into lease again
When can L have an AGA
Lease covenant against alienation and reasonable (or if commercial it was a condition of consent)
How can a fOrmer T recover for loss suffered under AGA
Recover from current T or indemnity (indemnity only implied into old leases)
Can L get a guarantor as well as an AGA
Yes
S17 LTA
L can sue original T for fixed charge not paid by current T. Serve notice within 6 months of it falling due
If old T pays under s17 LTA what can they have in return
An overriding lease
According to s18 LTA when does s17 apply
When new T agrees to variation of terms of lease not originally contemplated
S19 LTA terms of overriding lease
Same terms and duration plus 3 days
Must pay rent and comply with covenants
Ways to determine a lease
Surrender - mutually agree to end by deed (doesn’t end sub-t)
Disclaim- bankruptcy or liquidation (doesn’t end sub-t)
Repuditory breach
Frustration
Merge - L and T are same person
Ts remedies for breach of L covenant
Damages - contractual principles
Self help- cannot with hold rent but can notify L and if fail to repair then do it self and recover cost (set off at common law)
Set off at equity- T can have unliquidated claim set off against liability for rent if they withhold rent and L sues. Two claims must be sufficiently direct
Ls remedies for non-payment of rent
Debt action
Commercial rent arrears recovery - take possessions and sell.
Forfeit
When at commercial rent arrears recovery be used
Commercial property
Rent only (not insurance etc)
Rent due must exceed 7 days
L must give T min of 7 days notice of intention from authorised enforcement agent
When can T apply for relief from forfeiture
Pays everything before trial
Courts discretion within 6 months of court order
Courts discretion for Non residential lease within any period of time if no court order was obtained
Can L loose right to forfeit
If they waive breach expressly or impliedly by recognising continuation of lease in full knowledge of breach
How to forfeit
Make formal rent demand at premises in daylight unless lease removes this requirement
Ls remedies for breach of other covenants (not rent)
Damages
Specific performance
Self help - if lease allows L to enter
Forfeiture - other than for nonpayment of rent it must be allowed by lease
Notice required for L to seek damages from T for breach of covenant other than rent
If lease have 3 or more years unexpired serve s146 notice on T explaining they can serve counter notice claiming benefit of 1938 Act Within 28 days. If they do no further action without leave of court
How to forfeit - breach of covenant other than rent
Serve notice specifying breach and deadline to remedy
Does forfeiture of head lease end sub lease
Yes but sub T can apply to court to have headlease vested in them on terms court thinks fit
Can you remedy breach of covenant against alienation
No
