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Leasehold Estates - Detailed
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Combine with Leasehold Estates revised lecture of mine.
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Lecture 2: Leasehold [Live]: 16/10/20:[1] Residential Tenancies:
In this Live Lecture we look at residential tenancies. We will consider the following topics:
• The role of exclusive possession in distinguishing leases from functionally similar
occupancy arrangements
• Have questions around Air B&B how do we define from an occupancy to a
lease? Gets to the question of what a lease is etc.
• Multiple occupiers
• Where people in sharing occupancy arrangements
• Regulation of residential tenancies
• Rights and obligations in a modern residential arrangement/lease
[2] Exclusive Possession:
• Recall the lease is an estate in land
• Lease is recognised as proprietary, not contract
• Lease has an affect to bind 3rd parties [consequences]
• Defining feature of an estate is the right to exclusive possession
• Main quality of estate is the right to exclusive possession, right to exclude the
whole world from a piece of land, including the land owner, defining moment
of an estate.
• This concept has been used to distinguish leases from functionally similar occupancy
arrangements e.g. licences
[3] Street v Mountford [1985]:
Occupancy agreement:
- "I Mrs. Wendy Mountford agree to take from the owner Roger Street the single
furnished room number 5 and 6 at 5 St. Clements Gardens, Boscombe, Bournemouth,
commencing 7 March 1983 at a licence fee of £37 per week.
- I understand that the right to occupy the above room is
conditional on the strict observance of the following rules”:
o [3] The owner always has the right to enter the room to inspect its
condition, read and collect money from meters, carry out maintenance
works, install or replace furniture or for any other reasonable purpose
- [10] May be terminated by 14 days written notice
Definition of a lease: “the grant of exclusive possession for a term at a rent creates a
tenancy”
Substance over form approach: “If the agreement satisfied all the requirements of a
tenancy, then the agreement produced a tenancy and the parties cannot alter the effect of the
agreement by insisting that they only created a licence. The manufacture of a five pronged
implement for manual digging results in a fork even if the manufacturer, unfamiliar with the
English language, insists that he intended to make and has made a spade”
Lord Templeman
Exclusive possession used to distinguish licence vs lease:
- Helps to define what a lease is, exclusive possession is the key tool for
judiciary for distinguishing a lease from other occupancy
, - This is a licence arrangement owner of property has not given a grant of
exclusive possession to other party reserved right to access property
o E.g. hostile:
In those types of agreements there is a license yes you ca
occupy your room, but at no stage has the owner granted you
the legal right to exclude everyone else, they have reserved the
right for access for cleaning services etc.
By focusing on exclusive possession we can distinguish a
licence from a lease
-
Licence: “An occupier of residential accommodation at a rent for a term is either a lodger or
a tenant. The occupier is a lodger if the landlord provides attendance or services which
require the landlord or his servants to exercise unrestricted access to and use of the
premises”
Lease: “If… residential accommodation is granted for a term at a rent with exclusive
possession, the landlord providing neither attendance nor services, the grant is a tenancy;
any express reservation to the landlord of limited rights to enter… [view/repair] the premises
only serves to emphasise the fact that the grantee is entitled to exclusive possession and is a
tenant.”
Notes:
Court had to consider how do we actually define a lease? = key question
LPA 1925 would define this within s.1[1] but does not get very far, how do we
develop this to give us a test for what a leasehold actually is.
Wendy Mountford = occupier
o Occupied this under an occupancy agreement that she signed with Mr Street
and this agreement provided the following stated above ^
o She had friends who were paying a lot less, and had stronger set of legal
rights. She was aware of the Rent Act 1977
Under this, which applied to residential leases, tenants get stronger
protection against eviction and would have a fair rent.
If she find it is a lease itself, she can then get those protections = her
argument arguing her occupany was a lease
Roger street = owner [solicitor himself]
o He does not want the Rent Act to apply made it clear they sat as adults,
negotiated a contract and this was a license for you to occupy. Right to stay
there in contract law, if it is a license then the Rent Act does not apply.
Lord Templemen outlined a substance over form approach:
o Can see formality of arrangement, but what in substance have you created
within the law? Reality of your agreement?
o Surely a lease is a grant of exclusive possession at a term of rent =
o Definition of a lease:
“the grant of exclusive possession for a term at a rent creates a
tenancy”
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