Fragmentation by reference to time: leasehold estates

Definitions

DEFINITION: A lease is an estate in land given by a landowner to another person for a fixed or certain duration which gives that person a right to exclusive possession of the land.

“Demise” is another word for lease, as is “tenancy”.

Lessor’s interest during the lease: leasehold reversion.

Classification of leases

Fixed term

• lasts for a fixed duration and determines when the term expires

• term must be certain or capable of being made certain (eg ends ‘on the last day of the 2010 Cth games’ is capable of being made certain)

Periodic

• Seen as being for a definite period (eg a month) with a superadded provision that it is to continue for a further period unless the appropriate notice is given by either party

• Can be created by

  • Written or oral agreement

  • Fixed term lease is invalid but tenant goes into possession and pays rent periodically

  • Tenant overholds after expiry of a fixed term lease and continues to pay rent periodically

• Determines by proper notice to either party; what notice period is necessary depends on the period of tenancy

Tenancy at will (quasi-leasehold estate)

• Arise where a person is in possession with the consent of the landlord but does not pay rent

• Can be terminated at any time by either party without giving notice

• Alienation will bring the tenancy to an end

• Can arise by express agreement or by implication (usually by implication).

• Examples

  • Tenant overholding after expiry of lease

  • Purchaser allowed to occupy before settlement

Can't really be leasehold estate because there is no defined duration and duration is not capable of being known for certain. Even a tenancy at will can require reasonable notice (a ‘packing up’ period).

Tenancy at sufferance (quasi-leasehold estate)

• Arises when a person originally enters into possession with consent (eg a tenant), but remains without paying rent and without the assent or dissent of the landlord (eg overholding tenant)

• Tenant ‘holds over’ without landlord’s express consent or dissent, pays no rent

• Landlord may sue for recovery of possession at any time without notice

• Only arises by implication, eg where

  • T remains in possession after fixed term lease ends without paying rent

  • Life tenant pur autre vie for the life of A remains in possession after...

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