Leases- essential requirements Flashcards
what is a lease?
created when one person with an estate in land grants temporary right to another person to use and enjoy that land exclusively.
proprietary right.
how to distinguish between a lease and a licence?
- certainty of term- granted for a certain duration.
- exclusive possession- right to exclude others from the property.
- correct formalities-
what is a fixed term?
maximum duration of the arrangement is known from the outset.
- once it is created, neither party can unilaterally bring the lease to an end earlier unless there is a break clause present in the lease enabling them to do so.
what is a periodic term?
lease for one period.
can give notice to quit.
expressly or impliedly r.g monthly payment of rent.
‘term’= reference to which the rent is calculated not the intervals at which it is payable.
when will an occupier have exclusive possession?
question of fact.
substance of agreement has to be examined.
courts will look at reality of the situation.
what are the three scenarios which may indicate that an occupier does not have exclusive possession>
- landlord retains key and has right of access- courts will look at the purpose for which the key is retained. If to carry out repairs that this is an indication of exclusive possession.
- landlord provides services- indication of licence, not a tenancy. look to see whether it has been exercised. whether the tenancy is essential for them to better perform their duties.
- sharing clause- no exclusive possession, unless the clause is a sham.
how to have a business tenancy?
certain term and exclusive possession.
courts look at the degree of control of the business tenant and whether the landlord has the right to relocate.
how can joint tenants be viewed as a single entity?
Unity of possession- entitled to occupy the whole premises (if they have exclusive possession of part of a property it is possible for them to have leases on their part)
Unity of interest- same term, same conditions and jointly liable for rent.
Unity of time- interest must start at the same time.
unity of title- interests must derive from the same document or from separate but identical documents which are interdependent.
what are the factors that may defeat a lease?
- no intention to create legal relations e.g family arrangement, act of friendship or generosity.
- service occupancy e.g where the occupier is an employee and is required to live in the premises for the better performance of his duties as an employee.
what is the general rule for the formalities of creating a lease?
a deed must be used!
what are the formalities for leases over 7 years?
lease must be registered and created using a deed.
what are the formalities for a lease for 7 years or less? (between 3 and 7 years)
does not need to be registered.
(will be binding as overriding interests).
what are the formalities for a lease with a term of 3 years or less?
- need not be created by a deed IF
- lease takes effect in possession (tenant takes lease immediately)
- lease is granted at ‘best rent’ (market)
- the lease is not subject to a fine or premium (no upfront payment for the grant of a lease)
(not registered either as not more than 7 years).
(lease will be binding as overriding interest)
which type of lease do the short lease exceptions apply to?
- short fixed term leases.
express periodic tenancies.
implied periodic tenancies.
(for periodic, will fall under the exceptions if each individual period of the tenancy is for 3 years or less).
what are equitable leases?
if parties choose to enter into a contract for lease or may be the parties try to create a legal lease and fail by either not creating a valid deed or not registering the lease.
Courts will recognise they have an equitable interest in the land providing there is a document that complies with LPMPA 1989 and remedy of specific performance is available.
what are the formalities to create an equitable lease?
- in writing.
- contains all the terms.
- signed by both parties.
