Leases and licences Flashcards
Explain the three primary principles which Street v Mountford stands for when determining whether an agreement amounts to a lease or a license in a residential context
Principles from Street v Mountford:
- A lease is a grant of land, for a term, with exclusive possession.
- A license does not create an estate in land – it just makes an act lawful which would otherwise be unlawful.
- Exclusive possession is a power to keep out strangers and the landlord. In a residential context, you have exclusive possession when your landlord does not provide attendance or services which require unrestricted access and use of the premises.
- An agreement can be a lease even if it calls itself a license, so long as the effect of the agreement fulfills the definition of a lease
Explain why the court in Antoniades v Villiers held that Mr. Villiers and Ms. Bridger had a lease rather than a license.
It was clear from the course of negotiations and from what actually happened in practice that Mr Antoniades did not intend to share accommodation with Mr Villiers and Miss Bridger, nor to allow others to do so:
1. The right to do so, apparently reserved under the agreement, had never been exercised.
2. It was clear that neither of the defendants knew what ‘exclusive possession’ referred to; had Mr Antoniades intended to share, this would have emerged during negotiations.
The clause was a pretense and if it had been genuine there would have been more negotiating and discussion on the technicalities. It was only to get out of the Rent Act
Principles in Antoniades v Villiers
Principles:
- Separate agreements can be interdependent (in particular where they contain identical terms); one must examine the surrounding circumstances (e.g. did the occupants apply for the accommodation jointly, and did they seek joint and exclusive possession of the premises?).
- Specific terms in an accommodation agreement can be a pretense (or sham) and therefore take no effect. To establish whether the terms are a pretense, one must examine the surrounding circumstances (e.g. the course of negotiations, the intended and actual use of the premises, etc.)
Explain what Westminster City Council v Clarke adds to our understanding of when a clause in an agreement will amount to a sham.
When determining whether a term is a sham or not, the court can look to the purpose of the inclusion of the term. Does the term serve to fulfill the purpose of providing the accommodation (e.g. by ensuring that an occupant can be moved to a different room for their own protection/that of others in the building in order to fulfill a statutory duty)?
Drawing on the three key elements identified in the lecture, explain why the four young men in AG Securities v Vaughan were held to have licenses, rather than a joint tenancy
Requirements:
1. Unity of possession: each joint tenant must be entitled to possession of every part of the co-owned land. (Meyer v Riddick (1990) 60 P&CR 50, 54).
2. Unity of interest: each joint tenant’s interest must be the same in extent, nature, and duration.
The interests were different in AG Securities: the agreements each gave a six-month interest, which would then become monthly. Since each agreement took effect at a different point in time, the extent of the interest differed between each occupant: one had a six-month interest from a date in 1982, another had a six-month interest from a date in 1985 (by which time, the first occupant’s interest was only for a month), etc.
3. Unity of title: each joint tenant must derive their title to the estate from the same act (eg adverse possession) or the same document.
For example, Brown v Faulkner [2003] NICA 5(2) [39]. In relation to AG Securities v Vaughan, one of the problems with arguing that the four young men were joint tenants was that they had separate agreements which could not be read together so that there was no unity of title.
4. Unity of time: the interest of each joint tenant must normally vest at the same time.
’Vest’ in this context means ‘start’ – that is, each joint tenant’s interest in the land must start at the same time. Again, this was a problem in AG Securities v Vaughan, since the occupants of the flat signed different agreements at different times and their rights to occupy the flat began at different times.
Why do landlords sometimes prefer to give occupants of their dwellings a license, rather than a lease?
Giving occupants a license means that the license holder has a lot fewer rights, such as:
Whether you have the power to exclude the landlord and all others. This is reserved for leaseholders; licensees generally have no such power.
The extent to which you are protected from rent increases. In relation to fixed-term tenancies, rent increases are generally not permissible without the tenant’s agreement; in relation to periodic tenancies, the rent cannot normally be increased more than once a year. The extent of your rights as a licensee will depend simply on what the contract states (ie if it permits regular rent increases, then you will be subject to them).
Licensees have certain protections with regard to the state of the property, but leaseholders are protected by the Landlord and Tenant Act 1985, which offers more extensive protection
Leaseholders’ deposits must be placed in a deposit protection scheme (which helps ensure that if a dispute arises between landlord and tenant, the deposit will not be unduly withheld); no such protection exists for licensees.
Licensees can be evicted in accordance with the terms of their contract (there are some basic protections, but not as extensive as those of tenants). Absent a relevant term, the landlord need merely give ‘reasonable notice’ (usually 28 days, but it may be shorter).
On what grounds do Lucy and Mitchell argue that no one is a private owner of land? Do you agree with them?
Lucy and Mitchell argue that private property raises expectations and that these are not met in modern societies. In principle, private property means ultimate power, control and right over the land but in practice, in the modern western world, this is not the case and actions are constrained and controlled. They argue that a limited capacity to exclude others is simply not private property. e.g. Infrastructure Act 2015, Town and Country Planning Act 1990.
To a certain extent, yes, but at the same time, I believe that as society changes so can the understanding of what private property entails. Especially in terms of environmental regulations and city planning controls, these are very good for our society.
+ Stewardship of land
Discuss whether Lucy and Mitchell’s argument that no one is a private owner of land applies to leaseholders.
Yes, the argument applies to leaseholders as well. As in a leasehold, the rent increase is more regulated, it is not merely up to the landlord to determine. Termination protection is extensive in a leasehold, where the landlord cannot easily, on his own discretion, have the tenants leave. Furthermore, in a leasehold, the landlord could be excluded which ultimately takes away the power of the private owner and gives it to the tenant.
