Term
| What is a leasehold interest? |
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Definition
| an interest in land for a fixed period of certain duration granted in consideration of the rent received |
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Term
| What are the three essential requirements of a lease? |
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Definition
1) Exclusive possession
2) Certainty of duration
3) Proper creation |
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Term
| What is the test in exclusive possession discussing substance not form? |
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Definition
Radaich v Smith:
By seeing whether the grantee was given a legal right to exclusive possession of the land for a term or from year to year or for a life or lives.
Can be possible without a lease. |
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Term
| exclusive possession of bar within hotel not a lease, owing to personal nature of original business partnership |
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Definition
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Term
| exclusive possession at full market rent likely to indicate a lease |
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Definition
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Term
| What is the case for a lease being void for uncertainty? |
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Definition
Prudential Assurance v London Residuary Body
Valid if lease for fixed term determinable on the happening of some event (‘Lease for 5 years or until the land is required for road widening’) |
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Term
| Lease for life is not uncertain. |
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Definition
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Term
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Definition
Fixed Term
Periodic Tenancy
Yearly Tenancy
Tenancy at Will
Tenancy at Sufferance
Tenancy by Estoppel |
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Term
| Can a periodic tenancy be created by legal implication? |
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Definition
| Yes, Will arise from legal implication from possession of property and payment on some regular periodic basis |
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Term
| How long is the expected termination notice for periodic tenancies? |
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Definition
Notice must be given for a minimum of one cycle of the tenancy expiring on the end of the cycle
PLA s133-136 |
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Term
| How are yearly tenancies created at common law? |
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Definition
a) Express grant
b) Implied agreement (from common intention of parties) |
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Term
| If there is a tenancy and no agreement as to its duration, it will be deemed a tenancy at will determinable at any time by one months notice in writing |
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Definition
s129 PLA
Dockrill v Cavanah |
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Term
| What are the rules for termination of expressly created yearly tenancy? |
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Definition
| s135 PLA: Termination of expressly created yearly tenancy must be by at least 6 months notice expiring at the end of the year cycle. |
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Term
| How are tenancies at will created? |
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Definition
Implication of law:
where negotiations are continuing;
occupant to complete contract to purchase property
no periodic tenancy established through irregular payment
tenant in occupation after expiry of lease, but prior to paying rent on reg basis |
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Term
| How are tenancies at will terminated? |
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Definition
s137 PLA: notice must be for a reasonable period
Turner v York Motors – What is reasonable depends on circumstances and nature of occupation, 1 month enough in most circumstances |
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Term
| What is a tenancy at sufferance? |
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Definition
| - Arises by implication of law where a person holds over after a termination of a lease or tenancy without the permission of the owner |
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Term
| What is tenancy by Estoppel? |
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Definition
| - Both lessor and lessee are estopped from denying the existence of a lease (ie after conclusion of lease, tenant realizes LL was not true owner. Must still pay rent owing) |
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Term
| What are the general requirements for creation of a legal lease hold interests (>3 years)? |
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Definition
General rules in PLA:
s10, 11: in writing, signed by lessor
s59: evidenced in writing, signed by lessor
LTA: 181-185: registration of lease. |
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Term
| What are the formal requirements for creation of a short term leases (<3 years)? |
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Definition
- S12(2) PLA – can create an oral lease for 3 years or less (provided tenant enters into possession)
- S185(1)(b) LTA – Short term lease do not have to be registered, although they can be |
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Term
What are the effects of failure to comply with the requirements of a legal leasehold interest?
@ Law, In Contract, In Equity. |
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Definition
at law: void. except where T is in possession and paying rent - implied T@W. (Moore v Dimond)
in contract: if s59 satisfied - valid. (Leitz Leeholme Stud)
in equity: if spec performance available and lease is in writing, lease created. (Walsh v Lonsdale)
Oral lease can be recognised if doctrine of PP invoked. |
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Term
| What are the landlord's covenants? |
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Definition
1) Covenant for quiet enjoyment
2) Covenant not to derogate from grant
3) Covenant to maintain the premises in good repair
4) Common Law duty of care |
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Term
Case for quiet enjoyment.
Held: A landlord will be liable for the actions of third parties if they are aware of the actions by a tenant that disturb other tenants and they have the power of control under the lease and they fail to exercise that control |
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Definition
| - Aussie Traveller v Marklea: |
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Term
| What does not to derogate from grant? |
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Definition
| - Landlord must not interfere with or do anything inconsistent with the purpose for which the premises are let which will harm the tenant |
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Term
Derogation from grant:
- However if business is unusually sensitive and LL doesn’t know about it, small interference will not be derogation
- Loss must be physical, not economic loss (ie leasing adjacent property to business competitor not derogation from grant) |
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Definition
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Term
| What does in a condition fit for habitation mean? |
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Definition
| must be maintained so that by ordinary use damage is not caused to the occupier either in respect of personal injury or harm to health (Summers v Salford Corporation) |
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Term
| - LL must have knowledge of the defect for obligation to arise |
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Definition
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Term
| What's the common law duty of care for LL covenants? |
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Definition
| - A landlord will be liable in negligence where there is a failure to take reasonable care for the safety of the premises and where the injuries to tenants are caused by reasonably-foreseeable factors |
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Term
| What are the tenant's covenants? |
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Definition
1) Payment of rent (105(1)(a) PLA
2) Repair
3) Not to assign or sublet |
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Term
| ‘In the manner of a reasonable tenant’ means maintenance but not necessarily repairs, and keeping it clean and tidy. |
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Definition
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Term
| Explain the Haskell v Marlow exemption from s105 regarding wear and tear. |
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Definition
| S105 exemption from wear and tear limited to direct effects. Ie if tile falls off roof, tenant not responsible for immediate consequences, but if tenant does nothing over time more water will get in, walls will rot and house will become uninhabitable. Cannot say that this is wear and tear. |
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Term
| When are tenants free to assign? |
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Definition
| Lease contains no covenant against assignment, or is silent – tenant is free to assign |
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Term
| What are the four implied powers of the LL? |
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Definition
s107PLA:
a) To enter and view the state of repair of the premises
b) To enter and repair
c) To enter and carry out the requirements of a public authority
d) To re-enter and take possession |
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Term
| What are the two relationships an assignment of lease creates? |
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Definition
Contractual: privity of contract
Properietary: privity of estate |
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Term
| Explain understanding of privity of contract v privity of estate in assigning leases. |
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Definition
- When tenant assigns lease, he has privity of contract with both the landlord and assignee. There is also privity of estate between LL and assignee, but no privity of contract. So LL and tenant are only bound to each other on covenants that ‘touch and concern’ the land
- If LL assigns the reversion (right to possession once lease runs out, eg freehold): s117 and s118 PLA make both the benefit and burden of the covenants that ‘touch and concern’ the land run with the reversionary estate. So LL can sue and be sued on the covenants |
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Term
| How do sub-leases work in terms of breach of terms of head-lease? |
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Definition
- If sub-tenant is in breach of the head-lease, LL can end the head-lease and the sub-lease will fail
- Sub-tenant has both privity of contract and privity of estate with the original tenant |
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Term
| How can a lease end? (4 ways) |
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Definition
1) Effluxion of time – expiry of the term of the lease
2) Notice – in periodic tenancies (PLA s129-137)
3) Surrender – consensual ending of the lease prior to the expiry of the terms
4) Forfeiture – applies to fixed term leases but not periodic tenancies |
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Term
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Definition
| Early termination of a lease by the landlord because of some breach of covenant by the tenant. |
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Term
| When can LL forfeit a lease? |
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Definition
Rent is in arrears for one month
Tenant has been in default of a covenant for two months |
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Term
| How is forfeiture accomplished? |
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Definition
| - Forfeiture is accomplished by LL re-entering the land. |
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Term
| What is re-entry comprised of? (2 things) |
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Definition
Re-entry can be:
An unequivocal demand for occupation of the premises (Ex parte Whelan)
Commencing a court action for possession of the premises (Moore v Ullcoats) |
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Term
| Does LL need to give T notice of forfeiture? |
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Definition
Not enforceable without notice Notice must specify the breach Must ask lessee to remedy the breach, and allow the lessee a reasonable time to remedy the breach If lessee fails to remedy breach within reasonable time, lessor can forfeit lease
s124 PLA |
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Term
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Definition
| - Waiver is the unequivocal act by the lessor which indicates the lessor's intention to keep the lease in existence where the landlord has knowledge of the breach of covenant. |
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Term
| What options does the T have to purchase and renew the lease? |
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Definition
- S128 PLA: Exercise of an option in a lease is conditional on the tenant having properly performed the terms of the lease
- A landlord seeking to rely on a breach of a term of a lease as the basis for denying an option must give notice to the tenant of the landlord’s intention. |
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Term
| What are the landlord's remedies where T is in breach of a covenant? |
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Definition
1) Forfeiture (as discussed above)
2) Damages for breach of contract
3) Damages for repudiation or fundamental breach of contract |
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Term
- Repudiation arises where one party’s actions (usually the tenants) show an intention not to be bound by the lease.
Which case is this? |
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Definition
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Term
| What two options does the LL have if the breaches amount to repudiation? |
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Definition
1. Accept the repudiation (thereby terminating the lease), and
2. Seek damaged to recover all losses (including prospective losses for the unexpired period of the lease) |
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Term
| - Landlord has a duty to mitigate loss – must attempt to re-let the premises |
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Definition
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Term
| What will amount to repudiation? |
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Definition
Depends on individual facts
Consistent and deliberate breaches of fundamental terms will amount to repudiation
A tenant who abandons possession and stops paying rent will have repudiated lease obligations
Shevills Case |
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Term
| Summary of losses recoverable to LL on termination? |
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Definition
1. If lease is forfeited
- Rent owing to date of forfeiture
- Damages for breach of any other covenant (ie repairs)
2. If repudiation accepted
- All the above, and
- Any prospective losses
Cost of finding a new tenant
Loss of rent if replacement lease is at reduced rent |
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Term
| Four options available to T for breach of covenant? |
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Definition
1. Sue for damages
2. Terminate the lease (if the breach is serious)
3. If lessor repudiates, can accept repudiation and recover damages for loss of bargain
4. Rent owing may be set-off against damages caused by lessor’s breach (British Anzani) |
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Term
| Consult Retail Shop Leases Act for more information on Retail Shop Leases. |
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Definition
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