Leases

Question 1

For how long can a tenant grant a sublease?

Answer 1

Only for a shorter term than the term held by the tenant.

Question 2

What is a landlord entitled to under their reversionary interest?

Answer 2

Receipt of rent.

Power to retake physical possession once the lease ends.

Question 3

What are the formalities required for legal leases of more than three years.

Answer 3

A deed is required

Question 4

When may equity recognise an equitable lease?

Answer 4

Where there is a contract to create or transfer a legal estate.

Where there is an attempt to use a deed but the deed is not valid.

Question 5

When can a contract create an equitable lease?

Answer 5

There is a contract complying with s.2 LPMPA 1989 and the parties have clean hands.

Question 6

What if a contract is executed but the parties do not have clean hands?

Answer 6

An equitable right is known as an ‘estate contract’.

Question 7

What are the three essential characteristics of a lease?

Answer 7

The estate must be for a duration permitted for a leasehold estate.

The grant must give exclusive possession.

The grant must have the correct formalities

Question 8

What if one or more of the essential characteristics of a lease are missing?

Answer 8

Then a licence is created.

Question 9

What are the differences between a lease and a license?

Answer 9

Question 10

What happens when there is an attempt to create a lease for life?

Answer 10

A lease is created for a term of 90 years which ends on the death of the tenant (or as otherwise provided for in the agreement).

Question 11

Will a fixed-term lease with a contractual break clause breach the essential requirement for permitted duration?

Answer 11

No

Question 12

What does exclusive possession entail?

Answer 12

The ability for the tenant to exclude all (including the landlord) from the land.

It extends beyond mere occupation and relates more to control of the property.

Question 13

What if a landlord retains keys to the property>

Answer 13

It does not negate exclusive possession unless the occupier lacks general control of the landlord’s entry.

Question 14

What are service occupancies?

Answer 14

Where an employer allows an employee to live in the employer’s accommodation for the better performance of their duties.

Such a service occupancy will terminate when the employment comes to an end.

Question 15

Are service occupancies leases or licenses?

Answer 15

Licenses.

Question 16

How is the term of the lease for a periodic tenancy calculated?

Answer 16

the term of the lease is calculated by reference to the period for which the rent is expressed to be reserved.

Question 17

What is the payment of rent evidence of?

Answer 17

An intention to create legal relations.

Question 18

What are contractual terms contained in a lease known as?

Answer 18

Covenants.

Question 19

Which covenants will be implied on the part of the landlord to include?

Answer 19

Quiet enjoyment; and

Obligations in respect of fitness of the property.

Question 20

What does the covenant of quiet enjoyment entail?

Answer 20

It does not mean the absence of noise, although regular excessive noise may amount to substantial interference.

Any acts likely to interfere with the residential tenant’s peace or comfort that are done to cause them to give up occupation are an offence under the PEA 1977.

Question 21

What are the landlord’s obligations in respect of fitness of the property?

Answer 21

Keep in repair the structure and exterior of the dwelling-house;

Keep in repair and proper working order the installations for the supply of water, gas,
electricity and sanitation; and

Keep in repair and proper working order the installations for space heating and water
heating.

However, the landlord is only liable if there is disrepair and only once such disrepair has been notified to them.

Question 22

What are the different types of alienation?

Answer 22

Assignment;

Sub- lease;

Mortgage/ charge;

Parting with possession/ occupation.

Question 23

What is the liability of the original tenant for old leases (before 1996)?

Answer 23

If the original tenant (T1) assigns the lease to T2, T1 remains subject to the burden of the covenants in the lease but ceases to be entitled to the benefit of covenants in the lease.

T1’s contractual liability lasts for the duration of the lease.

Question 24

What is the liability of an assignee for old leases (before 1996)?

Answer 24

When the original tenant (T1) assigns the lease to an assignee (T2) there is a relationship of
privity of estate between the landlord and T2 which means the tenant is entitled to exclusive possession, liable to pay rent and is the party in whom the lease is currently vested.

T2 is liable for breaches of all real covenants which are covenants which touch and concern the land and include both positive and restrictive covenants.

An assignee is only liable under privity of estate for the duration that the lease is vested in them

Question 25

What are examples of real covenants?

Answer 25

To pay rent, rates or taxes;

To repair;

relating to the use of the property.

Question 26

What if the new tenant fails to comply with obligations under an old lease?

Answer 26

The landlord has the choice of pursuing the original tenant under privity of contract or the new tenant under privity of estate or both.