A lease is a interest in land, giving a tenant the exclusive possession for a fixed period of time, in consideration of a payment (rent).
Interest in property — a property interest that includes possession of the property [unlike license, a permission, which is a contractual right, short-term with consideration ($). Land Law].
The landlord’s rights are subject to the tenancy, and they also have
reversionary interest of the property at the end of the tenancy.
(The interest returns to the landlord.)
Types of lease:
- Fixed-term lease
- dates to begin and end
- ends automatically
- Periodic tenancy
- yearly, monthly, weekly
- determined by the payment of rent
- either may terminate near completion by giving notice
- Tenancy at will
- any time
- either may terminate at any time by giving notice
- Tenancy at sufferance / holdover tenancy
- tenant remains after expiration of lease until landlord ejects/evicts, or imposes a new lease
- tenant still liable for rent.
Terms in lease
A lease agreement includes:
- Premises
- date, names, address
- Habendum — to have and to hold
- commencement and duration of lease
- Reddendum
- rent clause
- amount, deposit, review…
- Covenants
- Conditions
- Warranty
Option to renew — a specific clause to allow a tenant to continue to occupy the premises.
Diplomatic / Repatriate clause safeguards the tenant if they are no longer employed or is transferred to another country. Allows termination of a lease after 12 months by giving a two month notice. Security deposit refunded.
Rent review clause defines the intervals to adjust rent.
Covenants and rights
Landlord covenants:
- Quiet enjoyment of the premises, allowing tenant the use of the premises without interference.
- No derogation from the grant, observing all the terms granted to the tenant.
- Property must be fit for habitation at the start of lease.
- Good title, paid property tax and quit rent (? quit rent is a tax that seems to have been abolished).
- Exclusive possession of the premises for the fixed term.
- Any buyer or successor is bound to the terms of the lease.
Tenant covenants:
- Pay rent, utilities…
- Keep premises in good repair
- No alterations, waste, sublet, nuisance, unapproved purposes
- Allow access to landlord, potential tenant/buyer to view premises.
Landlord rights:
- Twice a year, with two days’ notice in writing, to view the property.
- Serve notice in writing to tenant of defect, requiring repair.
- Enter and effect repair if tenant does not, without interfering with use and occupation of premises by tenant.
- Landlord may re-enter leased property when
- rent is in arrears for 30 days
- a default to covenant / condition is continued for 30 days
- repairs are not completed in timeframe.
- Tenant still liable for breach.
Termination of lease
By expiry, unless an option to renew was exercised.
By express power, clause in agreement states an event on which it ends.
By surrender of the unexpired term, when the tenant gives notice and landlord accepts.
By forfeiture, a term in the lease is breached.
By notice to quit, a clause that clearly allows for this right.
When rent is not paid, here’s relief.
Within six years of the arrears due,
Distress Act seizes and sells tenant’s goods for rent not exceeding 12 months of the tenancy. Tenant can apply to court in five days to stop the sale.
Forfeiture of lease brings the lease to an end, unless tenant pays for all arrears within four weeks of notice.
Waste
Waste — alteration or damage to land, brought to court.
Permissive waste is when the tenant allows land to fall into disrepair; usually not liable, and liability imposed by lease.
Voluntary waste is intentional damage, and the tenant is liable unless excused by lease.
Equitable waste is wanton destruction, restrained in equity (unjust and unfair). Liable unless excused by lease, especially for life tenant.
Ameliorating waste improves the land. Must be restrained, and court will intervene if “substantially injurious character”. 🙂
When others get involved
Assignment of lease — Executed from current to new landlord/owner.
Novation — Executed from current to new tenant. (Not the end of a contract. New tenant takes over obligations of the tenancy).
Subletting of lease? Tenant responsible for sub-tenant.
Privity of Contract — Only parties on the contract can sue each other.
Privity of Estate — Third party not in contract, but has an interest in the property, can sue based on the contract. (New landlord/owner to current tenant.)
❤️🌧️
Image of someone on a couch under a blanket/towel by Wokandapix from Pixabay.
Tenant or landlord? Either’s fine. 🙂
