Property - LANDLORD/TENANT LAW

Question 1

Four Leasehold or Nonfreehold Estates

Answer 1

(1) Tenancy for Years
(2) Periodic Tenancy
(3) Tenancy At Will
(4) The Tenancy at Sufferance

Question 2

TENANCY FOR YEARS (aka “Estate for Years” or the “Term of Years”)

Answer 2

Tenancy-for-Years (aka “Term of Years”) is a lease for a FIXED PERIOD OF TIME. It could be as short as 2 days or as long as 50 years

When you know the termination date from the start, you have a TENANCY OF YEARS

A TERM OF YEARS for greater than one year MUST BE IN WRITING to be enforceable due to Statute of Frauds

Because a TERM OF YEARS states from the outset when it will terminate NO NOTICE is needed to terminate

e.g. L leases Blackacre to T “from Jan 1, 2011 to July 1, 2011 — this is a “term of years” bc know end date

Question 3

How much NOTICE is needed to terminate a TERM OF YEARS?

Answer 3

Because a TERM OF YEARS states from the outset when it will terminate NO NOTICE is needed to terminate

Question 4

The PERIODIC TENANCY

Answer 4

This is a lease which continued for SUCCESSIVE intervals until Landlord or Tenant give proper notice of termination

Can be created EXPRESSLY - e.g. L conveys to T from “month-to-month” or “year-to-Year” or “week-to-week”

Can arise by IMPLICATION, in any one of three ways:
(a) Land is leased with NO MENTION OF DURATION, but provision is made for the payment of rent at set intervals

(b) VIOLATION OF SOF - An oral term of years in VIOLATION of the statute of frauds creates an IMPLIED PERIODIC TENANCY measured by the way RENT is tendered
- –e.g. L and T negotiate on phone for commercial lease of five years at $1,000 a month - violates Stat of Frauds so what you have is a month-to-month periodic tenancy

(c) THE HOLDOVER - In a RESIDENTIAL lease, if L elects to holdover a T who has wrongfully stayed on past the conclusion of the original lease, an IMPLIED periodic tenancy arises measured by the way rent is now tendered
e. g. T holds over after the expiration of her one-year lease, but sends another month’s rent check to L, WHO CASHES IT - not have an implied month-to-month periodic tenancy

***NY - in NY the landlord who elects to holdover a tenant creates an implied month-to-month periodic tenancy, UNLESS OTHERWISE AGREED

Question 5

What are the terms of a HOLDOVER Periodic Tenancy?

Answer 5

Generally, the terms and conditions of the expired tenancy apply to the NEW tenancy

In a COMMERCIAL lease, if the original lease was for one year or more, a year-to-year tenancy results from holding over
–if original lease was LESS THAN 1 year the periodic term is determined by the manner in which rent was due and payable under prior tenancy

In RESIDENTIAL leases it becomes a month-to-month (or week-to-week if T was paying week to week) regardless of what prior tenancy was - aka it just becomes periodic tenancy based on when rent is paid

ALTERED TERMS - if L NOTIFIES the T before termination of the tenancy that rent will be increased, the tenant will be held to have acquiesced to the new terms if he does not surrender, EVEN IF HE OBJECTS to the increased rent, provided increase is REASONABLE

Question 6

How do you TERMINATE a PERIODIC TENANCY?

Answer 6

NOTICE, usually written, must be given
– At common law, at least equal to the length of the period itself, unless otherwise agreed (thus a month-to-month periodic tenant gets a months notice)

IF the tenancy is from year-to-year or greater, only 6 months NOTICE is required

FREEDOM OF CONTRACT - by private agreement, parties may lengthen or shorten these common-law prescribed notice periods

Note also - PERIODIC TENANCY must end at the conclusion of a natural lease period
e.g. month-to-month tenancy started on Jan 1. O may 15, T sends written notice, T is bound until June 30th

Question 7

TENANCY-AT-WILL

Answer 7

TENANCY-AT-WILL is a tenancy of no fixed duration

e.g. “To T for as long as L or T desires.”

Unless the parties expressly agree to a tenancy-at-will, the payment of regular rent will cause a court to treat this as an implied periodic tenancy

the tenancy at will may be terminated by either party at ANY TIME but a reasonable demand to vacate is usually needed

**in NY, the landlord terminating a tenancy at will must give a minimum of 30 days written notice of termination

Question 8

TENANCY-AT-SUFFERANCE

Answer 8

IT is created when T has WRONGFULLY HELD OVER past the expiration of the lease. We give this wrongdoer a leasehold estate (tenancy-at-sufferance) to permit L to recover rent

Tenancy-At-Sufferance lasts only until L either EVICTS T or elects to hold T to a new tenancy

**NY, landlord’s acceptance of rent subsequent to the expiration of the term will create an implied month-to-month periodic tenancy, unless otherwise agreed

Question 9

TENANT’s DUTIES

Answer 9

(1) Liability to third parties
(2) Duty to REPAIR
(3) Duty to PAY RENT

Question 10

Tenant’s Liability to Third Parties

Answer 10

this is a matter of tort law

T is responsible for keeping the premises in good repair

T is liable for injuries sustained by THIRD PARTIES T Invited, even where L promised to make all repairs

e.g. L leases building to T, expressly promising to maintain premises in good repair. T’s invitee trips on loose floorboard and sues T. If invitee sues T, T LOSES (even though T may seek indemnification from L)

Question 11

Tenant’s Duty to Repair

Answer 11

Tenant has a duty to repair when the lease is silent

The Standard: Tenant must MAINTAIN the premises and make ordinary repairs
–he need not do anything more but can’t commit WASTE (remember 3 kinds: voluntary, permissive, ameliorative)

Question 12

What is a “Fixture”

Answer 12

A FIXTURE is a once-movable “chattel” that has been so affixed to land that it has ceased being personal property and has become a party of the realty
–OBJETIVELY shows the intent to permanently improve the realty

e.g.s Heating systems, custom storm windows, a furnace, certain lighting installations

Question 13

The Law of Fixtures

Answer 13

Fixtures follows the “walks with waste” doctrine

When a tenant removes a fixture she commits VOLUNTARY WASTE

T must not remove a fixture, no matter that she installed it

FIXTURES PASS WITH THE OWNERSHIP of the land

Question 14

How to tell when a tenant installation qualifies as a FIXTURE

Answer 14

(1) Express Agreement Controls
(2) SUBSTANTIAL HARM TEST - In the absence of agreement, T may remove a chattel that she has installed so long as removal does not cause SUBSTANTIAL HARM to the premises
(3) If removal WILL CAUSE SUBSTANTIAL HARM, then in objective judgment, T has shown the intent to install a FIXTURE and the fixture must stay put

Question 15

Tenant’s Duty to repair when Tenant has EXPRESSLY COVENANTED in the lease to maintain the property in good condition for the duration of the lease

Answer 15

At COMMON LAW, historically, T was liable for any loss to the property, including loss due to FORCES OF NATURE

Today, MAJORITY VIEW - T is off the hook T may end the lease when the premises are destroyed without T’s fault

Note: in NY** absent tenant’s express undertaking to restore the premises in the event of their destruction, if the premises are destroyed through no fault of tenant, tenant may quit the premises and surrender possession without any further duty to pay rent

Question 16

Tenant’s duty to PAY RENT

Answer 16

2 situations for breach of this duty

(1) Tenant doesn’t pay rent and IS IN POSSESSION of the premises – L MAY
(i) EVICT through the courts
(ii) continue relationship and SUE FOR RENT

L MAY NOT resort to SELF-HELP
**IN NY, self-help is flatly prohibited and entitles tenant to treble damages

(2) Tenant doesn’t pay rent and is NOT IN POSSESSION - L may SIR
(i) SURRENDER - L could choose to treat T’s abandonment as an implicit offer to surrender which L accepts (Surrender is when T shows by words or conduct that she wants to give up the lease)
- -NOTE: if the unexpired term is greater than one year - surrender must be in writing to meet the statute of frauds, but L just has to send a signed (by L) letter to tenant says “i accept your surrender” and that will suffice

(ii) IGNORE - L may ignore the abandonment and hold T responsible for unpaid rent, just as if T were still there - this option is available only in a MINORITY of states
(iii) RE-LET - L could re-let the premises on the wrongdoer tenant’s behalf and hold him liable for any deficiency

MAJORITY RULE: L must at least try to re-let (this is a mitigation principle

but in NY** generally does not require landlord to mitigate damages when tenant abandons premises

Question 17

LANDLORD’s DUTIES

Answer 17

Major Duties

(1) Duty to Deliver Possession
(2) Implied Covenant of QUIET ENJOYMENT
(3) Implied Warranty of Habitability

Question 18

Duty to Deliver Possession

Landlord Duties

Answer 18

The MAJORITY TULE (known as the “English Rule”) requires that the Landlord put the Tenant in PHYSICAL POSSESSION of the premises.

Thus, if at the start of tenant’s lease a prior holdover tenant is still in possession, Landlord has breached and the new tenant gets damages

[Note: the “American rule” (minority view) is that L need only give T legal possession and not physical possession - e.g. by giving T keys to the premises]

Question 19

The Implied Covenant of QUIET ENJOYMENT

Answer 19

A tenant has a right to the “quiet use and enjoyment of the premises without interference from Landlord.
–Applies to both RESIDENTIAL and COMMERCIAL leases

2 ways to breach

(1) Breach by ACTUAL WRONGFUL EVICTION - this occurs when L (or someone with paramount title) wrongfully evicts T, or excludes T from the premises
- – Actual Eviction terminates the tenant’s obligation to pay rent

(2) Breach by CONSTRUCTIVE EVICTION.
elements of constructive eviction -
SING

(i) SUBSTANTIAL INTERFERENCE - sub int. with ability to live there (ie so court can conclude the premises are uninhabitable), due to L’s actions or failures. Substantial interference could be a chronic problem, doesn’t have to be permanent (e.g. every time it rains apt floods)
(ii) NOTICE - T must notify L of the problem and L must fail to respond meaningfully
(iii) GOODBYE - T must vacate within a reasonable time after L fails to remediate

Note: the landlord is NOT liable for acts of other tenants with 2 exceptions

(1) L must not permit a NUISANCE on site
(2) L must control all COMMON AREAS

REMEDY: Tenant may terminate lease and may also seek damages

Question 20

Implied Warranty of Habitability

Answer 20

THE STANDARD: The premises must be fit for basic human dwelling (ie reasonably suitable for human residence)
– the appropriate standard may be supplied by HOUSING CODE or case law

Applies only to RESIDENTIAL leases

Sorts of problems that trigger breach of the implied warranty of habitability include: no heat in the winter, no running water, no plumbing etc.

Question 21

What are T’s entitlements when the implied warranty of habitability is breached

Answer 21

MR^3: Move, Repair, Reduce, Remain

M: MOVE out and end the lease (but, unlike breach of quiet enjoyment by constructive eviction, T doesn’t have to)

R: REPAIR and deduct, allowable by statute in a growing # of jurisdictions. T may make the reasonable repairs and deduct their cost from future rent

R: REDUCE rent ..and/or withold all rent until the court determines fair rental value. Typically, T must place withheld rent into an “escrow account” to show her good faith

R: REMAIN in possession, pay rent and affirmatively seek money damages

Question 22

RETALIATORY EVICTION

Answer 22

If T lawfully reports L for Housing Code Violations L is barred from penalizing T, by, for example, raising rent, ending the lease, harassing T, or taking any other reprisals

(can’t lash out at good faith whistle blowers)

Question 23

ASSIGNMENT V. SUBLEASE

Answer 23

the distinction between Assignment and Sublease is meaningful because it determines whether landlord can proceed DIRECTLY against the transferee or only against the transferor

RULES Re: Assignments and Subleases
In the absence of some prohibition in the lease, a T may freely transfer his or her interest in whole (thereby accomplishing an ASSIGNMENT) or in part (thereby accomplishing a SUBLEASE)

In the lease L can prohibit T from assigning or subletting without L’s prior written approval

However, once L consents to one transfer by T, L waives the right to object to future transfers by that T, unless L EXPRESSLY reserves the right

• IN NY*****
  (a) ASSIGNMENT - unless the lease provides otherwise, a residential T may NOT ASSIGN without L’s written consent. L can unreasonably withhold consent to ASSIGN, and T’s sole remedy is to seek RELEASE from the lease.

(b) SUBLEASES - in NY, a T in a residential building having four or more units has the RIGHT TO SUBLEASE subject to L’s written consent. Consent to sublease CANNOT BE UNREASONABLY WITHHELD. Unreasonably withheld consent is deemed consent.

Question 24

The Assignment

Answer 24

e.g. T1 has 10 months remaining on a 2-year term of years. T1 transfers all 10 months to T2.
This is an ASSIGNMENT because T1 is giving everything she has to T2.

As a result, L and T2 (assignee) are in PRIVITY OF ESTATE - this means that L and T2 are liable to each other for all the covenants in the original lease that “run with the land.”
—Common e.g.s - the promise to pay rent, to paint , to repair, to pay taxes

L and T2 are NOT in PRIVITY OF CONTRACT unless T2 ASSUMES all promises in the original lease

L and T1 are no longer in PRIVITY OF ESTATE. However, they remain in PRIVITY OF CONTRACT

Thus, L and T1 are SECONDARILY LIABLE to each other.

e. g. L leases Blackacre to T1. T1 assigns to T2. T2 assigns to T3. T3 engages in flagrant abuse to the premises.
- - L can proceed against T3 because L and T3 are in PRIVITY OF ESTATE
- L can proceed against T1 (he is SECONDARILY liable) as well because they are in PRIVITY OF CONTRACT
- L CANNOT proceed against T2 because L is not in privity of estate or privity of contract with T2

Question 25

The SUBLEASE

Answer 25

L and Sublessee are in neither privity of estate nor privity of contract. They share NO NEXUS.

The relationship between L and T1 remains fully in tact during sublease. T1 is liable to T2 and vice versa.

Question 26

Landlord’s TORT LIABILITY

Answer 26

The common law of caveat lessee (“tenant beware”) is the norm - ie let T beware.

For personal injury, L was under no duty to make the premises safe

However, there are 5 EXCEPTIONS to this common law rule - CLAPS
C - COMMON AREAS - L must maintain all common areas (e.g. hallways, stairwells etc.)

L - LATENT Defects rule - L must WARN of hidden defects that L knows about or should know about - note: this is a duty to WARN not REPAIR

A - ASSUMPTION of repairs - A L who voluntarily makes repairs must complete them with reasonable care

P - Public Use Rule - L who leases public space (such as a convention hall or a museum), and who should know, because of the nature of the defect and the length of the lease, that T will not repair, is liable for any defects on the premises

S - SHORT-TERM lease of furnished dwelling - L is liable for any defect on site (short term = 3 months or less)