Leases

Question 1

Javad v Mohammed Aqil (1991)

Answer 1

Both parties were in the process of negotiating a 10 year lease over land
During negotiations, the potential lessee was let into possession of the land, for which he paid quarterly
Negotiations broke down and the potential lessor sought to evict
The potential lessee refused to leave on the basis that his possession had created an implied quarterly periodic tenancy, which gave rise to protection under landlord and tenant legislation

HELD: No periodic tenancy.

The potential lessee was merely a tenant at will. The parties had not intended for there to be anything more than this whilst formal negotiations were taking place
Although the payment of rent is a good indicator of an implied periodic tenancy, allowing possession during negotiations is a classic case giving rise to a tenancy at will.

Question 2

Barclays Wealth Trustees v Erimus Housing (2013)

Answer 2

A fixed term commercial lease, which had contracted out of landlord and tenant protective legislation, expired
The lessee remained in possession of the premises whilst negotiations took place to create a new (more permanent) fixed term lease
After 16 months, negotiations had not been concluded
The lessee claimed that an implied periodic tenancy had been created, providing landlord and tenant legislative protection
Held: The parties did not intent to create a periodic tenancy, especially as such a tenancy would provide landlord and tenant legislative protection for the lessee, which was contracted out of in the previous lease
The lessee had merely a tenancy at will.

Question 3

Javad v Mohammed Aqil [1991

Answer 3

There was a tenant of will.

Nicholls said:
If one party allows another to go into possession on payment of rent
of so much per week or month, failing more, the inference to be drawn is that the parties intended that there should be a weekly or monthly tenancy .… But I emphasise the qualification ‘failing more’. Frequently there will be more. Indeed, nowadays there normally will be other material surrounding circumstances. The simple situation is unlikely to arise often, because of the new statute/legislation.

They had not agreed about the terms of the purposed lease so they could not have agreed to a periodic tenancy.

Parties going for 10 year fixed lease, it wold be wrong to infer from that they intended to create a periodic tenancy.

Question 4

Barclays Wealth Trustees v Erimus Housing [2014] EWCA

Answer 4

The payment of rent gives rise to no presumption of a periodic tenancy.

Rather, the parties’ contractual intentions fall to be determined by looking objectively at all relevant circumstances. The most obvious and most significant circumstance in the present case, as in Javad v Aqil, was the fact that the parties were in negotiation for the grant of a new formal lease. In these circumstances, as in any other subject to contract negotiations, the obvious and almost overwhelming inference will be that the parties did not intend to enter into any intermediate contractual arrangement inconsistent with remaining parties to ongoing negotiations. Inference is stronger if it carries statutory protection.

The parties did not intent to create a periodic tenancy, especially as such a tenancy would provide landlord and tenant legislative protection for the lessee, which was contracted out of in the previous lease
The lessee had merely a tenancy at will

Question 5

Bruton v London & Quadrant Housing Trust [2000]

Answer 5

There can be a lease even when that person does not have the fee simple.

Just because something is called a licence does’nt mean it is.

a local council acquired property which they proposed to redevelop but couldn’t afford to do it straight away so they granted a licence over the property to defendant housing trust. They gave defendant permission to use the property and provide temporary housing for the homeless. A license is simply permission to be on land, a license does not give the licensee (occupier) any proprietary interest in the land, it is simply a personal right. The agreement between Bruton (the homeless person) and the trust expressly acknowledged that the trust had no interest in the property and so the agreement proceeded on basis that they were not granting Mr Bruton a lease but a sub licence. Mr Bruton was not happy with condition of accommodation and wanted them to carry repairs, he claimed that they had statutory obligation, but this would only exist if he had a tenancy.

The basis of the estoppel is that having entered into an agreement which constitutes a lease or tenancy, he cannot repudiate that incident or obligation. …

Question 6

Kay v Lambeth LBC [2006]

Answer 6

– HOL stressed the non-proprietary status of Bruton type tenants.

As a lease requires a proprietary interest from which it can be granted, and which the licensee did not have, the lease would not bind the licensor

Question 7

Berrisford v Mexfield Housing Co-operative Ltd [2011] UKSC

Answer 7

HOL confirmed the contractual tenancy and acknowledge as in Kay v Lambeth that tenancy would not be binding on council.

Bruton v London and Quadrant Housing Trust [2000] was correct in law, and Bruton would not have rights exercisable against the owner of the property; only against the Housing Trust. Both Bruton and the housing trust could have assigned their rights.

Question 8

Street v Mountford

HL

Answer 8

Characteristics of a lease:

1) Exclusive possession
2) Certainty of duration (fixed/periodical)
3) Rent

The only intention of the parties which is relevant is the grant of exclusive possession, this is different from a license.

Exclusive possession = territory control, it can kick the landlord out and can exercise the rights of an owner of land.

Question 9

Prudential Assurance v London Residuary Body

Answer 9

Ð you must know the fixed maximum term of the lease.

Question 10

Lace v Chantler [1944

Answer 10

The maximum duration was not specified and certain.

A lease was purportedly granted ‘for the duration of the war’, referring to World War II.

2 Uncertain situations:

1) Termination event is uncertain, when it occcured (e.g. signing)
2) At commencement of the lease it was uncertin when the termination event would occur (uncertin duration).

The CA based its decision on the second point. Held: requirement of certain duration is not satisfied unless the maximum duration of lease is certain at commencement of lease (prospective certainty).

Prospective certainty is required (Prudential assurance)

The termination event (end of war) was conceptually uncertain, there might be disagreement as to when there was an end of the war, a truce?

Question 11

Ashburn Anstalt v Arnold [1989] Ch

Answer 11

Do not have to have prospective certainty as long as you will know when termination event takes place.

Land was sold but the purchaser did not require land immediately so the seller was allowed to stay in possession but the agreement went on to say that the purchaser could at any time give 3 months’ notice that they did require the land. Acquiring Lace v Chantler you would say you do not know when notice will be given. But COA in this said it does not matter because as long as you will know when you get there, this is sufficient to satisfy requirement of fixed duration. In an agreement for the sale of land, the vendor reserved the right to remain in the property ‘save that [the vendor] can be required by [the purchaser] to give possession on not less than one quarter’s notice in writing upon [the vendor] certifying that [the purchaser] is ready at the expiration of such notice to proceed with the development of the property ….’ COA thought that the problem in Lace v Chantler was that we don’t know what the end of the war means, so COA in this case said you do not need to have prospective certainty as long as you will know when termination event takes place. As long as you know when you have gotten there this is okay.

Question 12

Prudential Assurance v London Residuary Body

HL

Answer 12

Uncertain time. Periodic tenancies can be certain in duration as term contunies until determined as if both parties made a new agreement at the end of each year.
Supporting Lace v Chantler

Believed that Re Midland Railway Agreement and Ashburn was wrongly decided!

A grant for an uncertain term does not create a lease.

A lease can be made for 5 years subject to tenants right to determine if the war ends before the expiry of 5 years or lease made from year to year subject to fetter on right of landlord to determine the lease before expiry of 5 years unless war ends. Both are valid because create a determinable certain term of years.

Question 13

Re Midland Railway Agreement [1971] Ch

Answer 13

A 6 month periodic tenancy provided for determination by the landlord on 3 months’ notice if the landlord could show that he needed the land for his business premises.

Held: The notice requirement was enough to provide certainty of duration for a fixed term lease. It was preferable to hold parties to their intended bargains than to uphold a requirement of unqualified determination
This preference was overruled in Centaploy v Matlodge [1974].

Question 14

Centaploy v Matlodge [1974] Ch

Answer 14

weekly tenancy, but under terms the tenancy could only be determined by the tenant. Landlord had no power to determine in any circumstances. Held: this was a contradiction of terms, to allow a periodic tenancies where one party had a right to bring it to an end and the other did not, inconsistent with nature of periodic tenancies.

Question 15

Prudential Assurance v London Residuary Body

Answer 15

The lease was said to last until the land was required for further development.

The lease was void
Prospective certainty is required in the certain duration of a lease
In order to make an equivalent lease with certain duration, a nominal date should be set far in the future with the option to terminate early

Question 16

Berrisford v Mexfield Housing Co-operative Ltd [2011] UKSC

Answer 16

landlord was a housing association and let a flat to the tenant in consideration of a weekly rent. Agreement was expressly determinable by the tenant giving one month’s written notice. However, the landlord could only terminate in tightly prescribed circumstances such as non-payment of rent etc. Despite this provision, in absence of any default of any tenant wrongdoing, the landlord gave one-month notice to tenant. Tenant objected, the court applying Prudential Assurance said the tenancy was void for uncertainty because power for landlord to terminate it meant the lease did not satisfy duration of fixed term.

Question 17

Berrisford v Mexfield Housing Co-operative Ltd [2011] UKSC

Answer 17

s 149(6) of the Law of Property Act 1925 turned the agreement into a 90 year fixed term lease determinable under express provisions.
Therefore, satisfy the common law requirement of fixed term. The Berrisford line of argument was qualified in 2 cases below.

Question 18

Hardy v Haselden [2011] EWCA

Answer 18

held could only use 149(6) if the agreement was in writing.

Question 19

Southward Housing Co-operative v Walker [2015] EWHC

Answer 19

further limited by saying if anything in agreement which is inconsistent with an intention to create a 90 year term then the Berrisford approach cannot be used. (s149(6)).

Question 20

Street v Mountford

Answer 20

talked about exclusive possession for a term in return for rent, it is true that for majority of cases, leases are granted in return for rent but contrary to assertion of Lord Templemen in Street v Mountford, the payment of rent is not a requirement of a lease. Pointed out in ashburn case that any requirement of such would be inconsistent with s205 LPA.

Question 21

Lynes v Snaith [1899] 1 QB

Answer 21

This case found that the key distinction between a lease and a licence is the concept of exclusive possession.

Exception - where negative any intention to create a tenancy

Question 22

Facchini v Bryson (1952)

Answer 22

Exception to the Lynes v Snaith rule: where an act of generosity, friendship, or a family arrangement was part of the material circumstances to the creation of a ‘lease’, that ‘lease’ would not be created where there was no intent to create a lease, it will negative any intention to create a tenancy.

In the present case, however, there are no special circumstances. … The occupation has all the features of a … tenancy, and the parties cannot by the mere words of their contract turn it into something else.

Question 23

Street v Mountford

Answer 23

Street granted Mountford the right to occupy two rooms in his house, with exclusive possession, for a weekly rent and determinable on 14 days’ notice
Street had Mountford sign a declaration that the right to occupy constituted a licence and not a lease. Mountford sought a declaration that the agreement constituted a lease

Held:Was the agreement a lease? yes

A court is entitled to look behind the label given to an agreement to decide whether in fact a lease was granted, but disguised as a licence
The agreement here was clearly a lease, therefore Mountford was entitled to legislative protection under landlord and tenant legislation. It put to an end the sham Somma v Hazlehurst cases.

Question 24

Aslan v Murphy [1990]

Answer 24

A licence containing a clause requiring the surrender of possession between 10:30 and 12:00 each day was said to constitute a sham licence designed to avoid landlord and tenant legislation. Applying Street v Mountford [1985], as there was never any intent to enforce this term, a lease had been granted.

This case also found that a lessor’s retention of keys, by itself, will not prevent a finding of exclusive possession.

Question 25

AG Securities v Vaughan

Answer 25

AG Securities, who had a long lease over a building, licensed each of 4 rooms to separate individuals at different times and under independent agreements.
The licensees claimed that they collectively held a lease over the building and therefore claim that they were entitled to protection under landlord and tenant legislation? Held: no.

In AG Securities v Vaughan case, the courts will be prepared to uphold a genuine sharing case

Question 26

Antoniades v Villiers [1990]

Answer 26

Unmarried couple occupied a double bedsitting room under separate but contemporaneous agreements, which sought to negative the grant of exclusive possession and required the occupiers to share with such other persons as the landlord might nominate. This was another Sommer v Hazlehurst case.

HOL said it was another Sommer v Hazlehurst, the Sommer approach was shut down in Street v Mountford.

Question 27

Mikeover v Brady

Answer 27

Where there are separate obligations upon licensees to pay licence fees to a landlord, a joint lease could not be found.
It is submitted that this case is wrong, as it is a Court of Appeal decision which undermines House of Lords (now Supreme Court) authority on the distinction between leases and licences, such as in AG Securities v Vaughan [1990].

Question 28

Javad v Mohammed Aqil

Answer 28

this tenancy at will could be converted into a LEGAL periodic tenancy by the acceptance of rent. We say legal because periodic tenancy has no formal requirements because comes under s52(2) exception and any periodic tenancy created will contain all terms of the wanted lease, so far as it is possible.

Question 29

Browne v Warner

Answer 29

This case decided that a formally-(one which was void as legal due to lack of formalities) could still constitute an enforceable contract for that lease.
Court held: equity would recognise this defective lease as a contract for a lease. They said a defective lease is a deemed contract for lease.

Question 30

Parker v Taswell

Answer 30

A defective lease at law will be deemed valid in equity.

Question 31

Coatsworth v Johnson (1886)

Answer 31

Have to come to equity with clean hands.

he had been in breach of obligation under terms of lease so in terms of equity he did not have clean hands so the court did not award him specific performance

Question 32

Warmington v Miller

Answer 32

if court had granted specific performance, this would be requiring the would be landlord to grant a sublease in breach of his own legal obligations

Question 33

Rouf v Tragus Holdings and Café Rouge (2009)

Answer 33

The doctrine of Walsh v Lonsdale (1882) will not operate where rent is unpaid.

Question 34

Walsh v Lonsdale (1882)

Answer 34

In 1879, by agreement in writing, L agreed to grant to W a seven-year lease of a mill. One of the terms of the lease was that the lessor/landlord could demand the payment of one year’s rent in advance. However, no formal lease was executed but W took possession of the mill and paid rent quarterly in arrears. 3 years into the intended lease, L demanded a year’s rent in advance and, when W refused to pay, he levied distress for it (by seizing goods belonging to W and would sell then in order to pay the rent he claimed to be owed). W said that the intended 7 year lease had not been executed and therefore he was a periodic tenant, gone into possession, paid rent which was accepted, before the new landlord/tenant legislation so wold have readily implied a periodic tenancy. W said an obligation to pay a years rent in advance was inconsistent with a legal periodic tenancy. Court said W sought specific performance of the agreement for a lease. W argued that distress was a legal remedy, not an equitable remedy; that, in the absence of formal execution of the seven-year lease, at law he was a tenant from year to year; that an obligation to pay rent a year in advance was inconsistent with such a tenancy; and that Lonsdale therefore had no entitlement to levy distress.

The tenant holds under an agreement for a lease. He holds, therefore, under the same terms in equity as if a lease had been granted, it being a case in which both parties admit that relief is capable of being given by specific performance. That being so, he cannot complain of the exercise by the landlord of the same rights as the landlord would have had if a lease had been granted. Court said that in theory the intended tenant may have legal tenancy and equitable version of intended 7 year lease persuent to Walsh v Lonsdale but equity prevails therefore it is the equitable lease which prevails with all the terms of the intended lease.
On the facts If for some reason the equity 7 year lease was not available because don’t satisfy all grounds then it would be open for tenant to rely on legal periodic tenancy if equitable route is not available, but if this happens, equity prevails first.

Question 35

Industrial Properties v AEI [1977]

Answer 35

Walsh v Lonsdale only applies to leases which are defective for some formality requirement.

The fee simple estate in some business premises were purchased from a business by its directors, but no formal conveyance was executed
The directors then granted a lease out of the purchased fee simple estate to AEI
AEI breach their covenant to keep the premises in good repair.

Held: As the sale of the fee simple estate was not formally completed, the doctrine of Walsh v Lonsdale (1882) could operate twice, first on the sale of the fee simple estate, and then on the lease.

The covenant was then enforceable

Question 36

Berrisford v Mexfield Housing Cooperative Ltd [2011] UKSC

Answer 36

Walsh v Lonsdale only applies to leases which are defective for some formality.

The problem was that the term was uncertain because it was a purported periodic tenancy , this meant that the arrangement was invalid as a periodic tenancy, but its invalidity was because is failed to comply with the substantive requirement of a tenancy, therefore, Walsh v Lonsdale could not be used to cure this.

Question 37

Forcelux Ltd v Binnie [2009] EWCA

Answer 37

XXX

Question 38

Pineport v Grangeglen (2016)

Answer 38

landlord made physical re-entry and tenant did nothing for 14 months then he sought relief against forfeiture. The court held that since it created no disadvantage to landlord provided the arrears were paid off and landlord recovered cost. The court re-granted the lease, so the court is indulgent towards tenants who do not pay the rent.

Question 39

Glass v Kencakes [1966]

Answer 39

if s146 notice does not comply with requirements it will be void and any forfeiture based on a void notice will itself be void.

Question 40

Anders v Haralambous

Answer 40

Notice must specify the particular breach complained of the breach complained off in 146bnotice must be the breach identified in the declaration of breach by the first tribunal. Established in the case

Question 41

Akici v LR Butlin Ltd

Answer 41

The specfiiciation must give adequate notice to the tenant so he knows what is needed for him to remedy the situation.

Question 42

Akici v LR Butlin Ltd [2006]

Answer 42

Specification must be required so tenant has notice to put things right. Has to be quite precise.

The one breach which was not mentioned was that the tenant had shared possession. Held: notice was void because it failed to specify the breach as required.

Question 43

Rugby School v Tannahill

Answer 43

if landlord did not want compensation then they did not have to ask for it.

Landlord was governor of rugby school; breach was that she used the premises which she rented was that she used the premises for prostitution. The school did not want compensation because they did not want compensation for prostitution. However, this is an exception.

Question 44

Anders v Haralambous [2013]

Answer 44

Breach complained of in 146 notice must be the breach identified in the declaration of breach by the first tribunal.

Question 45

Expert Clothing v Hillgate House

Answer 45

it is accepted that concept of capability of remedy turns on question of whether “whether the harm that has been done to the landlord by the relevant breach is for practicable purposes capable of being retrieved’ (Expert Clothing)

so the test of the remediability of the breach has become the test for damage of that breach. Was the harm suffered by landlord be an effective remedy if the tenant would comply within reasonable time of a s146 notice.

Expert clothing case it required X to reconstruct premises within 9 months of lease, tenant failed but court said it is capable of remedy because reconstruction could be done after and landlord can be compensated. When premises were reconstructed he could charge a higher rent so if reconstruction took place later then he would lose money.

Question 46

Scarla house v Forbes

Answer 46

Court said no remedy for a” once and for all breach” in negative covenant. In this case they held once tenant breach once and for all negative covenant cannot be remedied. But this has been questioned.

Question 47

Savva v Hussein

Answer 47

breaches of covenants not to display signs on outside of premises or alter premises without consent of landlord (negative covenants). Court held: why can these breaches not be remedies, why cannot harm be retrieved, in respect of signs you can get permission and if landlord refuses you can pay any loss landlord might have suffered with signs being there. It appears that it can be remedied

Question 48

Akici v LR Butlin Ltd [2006]

Answer 48

breach of covenant against subletting or sharing possession (problem in Scala House v Forbes case). Neuberger said in case where house has been sublet for example, the tenant might persuade the sub tenant to surrender the sub tenancy, on the facts this may not be possible but you cannot say that such a breach is NEVER capable of being remedied because it may be possible to get it reversed.

Question 49

Telchadder v Wickland Holdings (2014)

Answer 49

Mr Telchadder was described as excentric, he lived in a block of flats and used to like hiding behind trees and jumping and scaring other residents, wearing camouflaged netting. Landlord sent a notice to him, which he warned that the tenancy will be terminated if he continued to do this, unsure if it was a 146 notice. He then resisted jumping out for 3 years and then his behaviour started to deteriorate and he harassed other residents including threatening them. The Landlord sought to terminate the argument on basis of its notice served 3 years ago. Court considered whether X was remediable and within a reasonable time (146(1) reasonable time requirement). Court held that this behaviour could not be remedied but it was not particularly grave behaviour and could be remedied by avoiding this antisocial behaviour in future. They stressed that it does depend upon facts of each case. Other issue in case was what sense could Mr T comply with notice within a reasonable time, how do you put right your antisocial behaviour. The court held: we need to read this in a flexible way and if he resisted behaviour for a reasonable time this will satisfy the requirement, for 3 years he behaved himself so he had remedied the breach and so the landlord could not rely on the 2006 notice for forfeiting the tenancy in 2009.
S146 notice should require the tenant to take remedial action. All breaches are capable of remedial remedy.

Question 50

Ropemaker Properties v Noonhaven [1989

Answer 50

Usually, a breach of covenant against immoral use will not allow relief from forfeiture to be granted
but such a relief can be granted in exceptional circumstances

ropemarker were the landlords of premises and noonhaven were tenants under 25-year lease. The premises consisted of 5 floor and under terms of lease, the different floors were to be used for a nightclub. In fact, the premises were sub-let to different parties but the case concerned the use of two floors in property which were used as a burlesque club, each club charged entrance. Each club made money through sale of alcohol, the staff made it clear that X were available for sex. Landlord sought forfeiture and tenant sought relief. The court granted relief because 1) the immoral use had ended and was unlikely to resume 2) getting rid of the tenants would not remove the stigma because clubs had been run by manager who had long left. 3) the landlord themselves admitted that any stigma attached to the use of property would be short lived. But a key factor was that the lease of the premises was of substantial value and two years before these events, the landlords had been willing to buy back the lease from the tenants for a substantial money. Therefore, the premises would be worth more now, so if forfeiture was afforded the tenants would loose a valuable property which was out of proportion to the offence caused to landlord. So court held that they would grant relief against forfeiture.

Question 51

GMS Syndicate v Gary Elliott [1982] Ch 1

Answer 51

tenant had sublet part of premises but retained other part themselves, breach committed on sublet part. Nevertheless the landlord sought the lease of the hwol property. Court held that this was too harsh and they would grant relief on the part of premises which had not been involved in breach.

Ð relief against forfeiture for tenants: s 146(2)
Ð relief against forfeiture for sub-tenants: s 146(4)

Question 52

Escalus Properties v Dennis [1996] QB

Answer 52

Definition of lesse in s146 means that a subtenant can apply for relief against forfeiture under s146(2) which applies to tenants so in both cases although there is a distinction between tenants and subtenants, the subtenant can apply as if it is a tenant. If you can apply under s146(2) as a tenant, if you are granted relief as tenant it involves reinstatement of original relief whereas if relief is granted under s146(4) it will normally take form of a new lease. This is significant because it might make a difference in the rent payable because if the old lease is reinstated the tenant pays rent at level of original lease but if subtenant gets a new lease this is likely to be a higher rent so advantages for subtenant to seek relief as a tenant not as a subtenant.

Question 53

Statutory benefits of leases

Answer 53

1) Security of tenure - ¥ Except in specifically circumstances a landlord who has let his property to a tenant, he could not evict a tenant, even if there was a weekly tenancy, landlord could not give a notice for eviction.
2) Rent control - landlord cannot raise the price ridiculously to kick X out.

Question 54

s54(2)

Answer 54

No need for deed if less than 3 years and if:

1) possession
2) rent
3) A fine = lump sum

Question 55

Requirments of equitable lease

Answer 55

Ð Equitable lease depends upon availability of specific performance this required compliance with 3 conditions in s2. If SP is not available, the tenant might be able to rely on legal periodic tenancy but this is subject to termination of notice to quit.

Equitable lease must be protected by registration.
Ð Registered Land – Notice on the charges register. Unregistered land – Class C4 land charges.

Question 56

Can an equitable lease be protected?

Answer 56

yes

Ð Registered Land – Notice on the charges register.

• Unregistered land Class C4 land charges.

Question 57

Requirements of forefeiture

Answer 57

1) There must be a forfeiture clause

Question 58

Scheme’ of forfeiture

Answer 58

1) Breach of covenant
2) re-entry of property
3) possession proceedings

Question 59

Billson v Residential Apartments

Answer 59

Where a court order forfeits a lease, a lessee may not then apply for relief from forfeiture

However, were peaceable possession if taken (physically, and without a court order), a lessee may apply for relief from forfeiture within a reasonable period of time

The House of Lords expresses their distaste for the option given to lessors to re-take possession under forfeiture without a court order (which is legal)

Question 60

Breach - non payment of rent of lease

Answer 60

If breach takes form of non payment of rent:

1) landlord makes a formal demand for rent which is due but not paid (most leases exempts the landlord from this requirement)
2) Landlord can then commence action for possession proceedings.
3) payment before judgment At any time before the date of judgement in these proceedings the tenant can stop these proceedings by paying the rent and any costs the landlord has encountered by the proceedings, this will automatically bring proceedings to an end.
4) relief against forfeiture

Question 61

Hammersmith v Monk

Answer 61

Periodic tenancies continue only so long as both parties wish for it to continue.