#19939 - Pq Map Licences And Leases - Land Law

Licences

Licences: Personal right, allowing B to do something over A’s land, which otherwise would’ve been a trespass: Thomas v Sorrell

No formality requirements for licenses. Creation can be deliberate or accidental

• Colchester Coop v Kelvedon (2003): Parties intended to create licence even though easement was possible. Intention relevant to distinguishing between easement & licence, but not between lease & license.

Step 1: What licence?

3 types: Bare licenses; Contractual licenses; Estoppel Licences (w8).

• Bare licence: Gratuitous permission to enter another’s land. Eg, being invited for dinner. (no legal issues)

  • If A revokes this after B enters, B must leave in reasonable time (Robson v Hallet).

• Contractual licence: Permission granted in return for consideration. eg, buying a ticket to the cinema. Needn’t be created by formality (eg T&Cs at back of parking ticket).

  • Concern use of, not disposition of an interest in land. A obliged to give effect to license.

Step 2: Contractual licence will bind B, but what about 3rd parties?

What if A grants B license, but transfers the land to C? Do B's rights bind C?

• Bare Licenses: Since they don’t even bind A, they won’t bind C.

• Contract Licenses: Denning erroneously said that a contractual license can be a proprietary right (Errington)

Current law: Ashburn Anstalt v Arnold [1989]

• Principle 1: CLs only bind parties to contract, & don’t affect 3rd parties. Not right in rem.

• Principle 2: Unless C undertakes to effect B’s rights, when purchasing land from A, because C generates ‘new’ rights for B, and isn’t bound by A&B’s original agreement.

• Licence can’t be protected by Notice, ORI(AO), S3 1(2)/S 3 LRA 2002, nor a Land Charge.

Constructive trust: Ashburn, Lloyd v Dugdale

• Establishing CT, if a promise to honor the license was made + lower price paid. 2 elements:

1. The sale was subject to someone else's rights; +

2. Unconscionability: a) if C got discount due to right; b) simply knowing of right insufficient

   • Not desirable to impose trust from inferences

Step 3: Remedies

1. Specific performance usually awarded where A granted permission, but B hasn’t entered land yet.

Verrall [1981]: New council forced to honour old agreement to let NF use a hall

2. Injunctions usually awarded where A granted permission, but B is already on the land and A wants B removed.

Millennium Productions (1948): Prevents A from revoking license before its contractual date of expiry.

3. Damages usually awarded where performance is frustrated

Wood v Ledbitter: Damages where performance is impossible. Frustration principles apply.

Leases

Step 1: Does the lease satisfy the correct formalities?

1. Always transfer by Deed.

• s52 LPA:, all conveyances of land for the purposes of creating a legal estate must be by deed.

• By deed: all freeholds, all leaseholds except short leases (<3) (s54(2) LPA), prescription easements don’t.

2. Sometimes registration of title

• Must register: Freehold title s7 LRA 2002, Legal mortgages, 7+y leaseholds (s27(1)), express legal easements.

• Needn’t: Leases <7y, Leases >3<7 (optional, but deed), Leases <3y (can’t be registered, no need for deed).

Step 2: Criteria for the lease present? (Rent, Fixed term, Exclusive Possession): Established in Street v Mountford [1985]

Significance of the lease/license distinction

• Lease is a proprietary right, license is contractual. Former enforceable against 3rd parties, eg for claims of trespass or nuisance. Licensee can very narrowly sue in nuisance Dutton.

• Lessees are statutorily protected.eg right to challenge rent increases if exceed comparable rent (HA 1988, ss 13-14), No eviction without due process/court order s8 HA

1. Rent requirement

Ashburn Anstalt v. Arnold (1989) Non-essential:

• A could sell/give a leasehold estate to B, instead of requiring rent.

• The LPA 1925, s 205(1)(xxvii), also affirms that payment of rent isn’t essential.

• But some leases (eg in Housing Act) require rent to qualify for statutory protection.

Bostock v Bryant 1990: Rent can take any form (peppercorn), as long as it is certain (fixed & recurring).

However, expressly excluding rent can suggest that the parties didn’t intend to create a lease.

2. Fixed term

Lace v. Chantler (1944) Confirmed in Prudential [1992]

• Principle: Parties must know the maximum duration they are tied into the agreement, and that duration must be fixed/certain.

• An alleged lease for the duration of WW2 was void for being of uncertain.

However, periodic tenancies are valid (they are not fixed term tenancies)

• The requirements for an implied periodic tenancy, as specified by Lord Templeman in Prudential, are:

  • (1) C is paying rent; (2) C is in exclusive possession; (3) There is no fetter on the ability to give notice (to end it).

Prudential Assurance v London Residuary Body [1992]

• Principle: No express agreement, but B pays A regular rent, a tenancy of a certain duration can be implied from the facts.

• Eg: paying rent every week implies a periodic tenancy of one week. However, this isn’t one lease, it is a succession of weekly leases, that the parties can withdraw from with a week’s notice.

• If the periodic tenancy is <3 years, it is a legal interest.

• Facts: lease was of indeterminate duration ‘until road works start’. But lessee paid annual rent.

Sometimes, the fixed terms are implied in law, not agreed by the parties

Berrisford v. Mexfield (2011)

• Principle: Sometimes, uncertain terms are rendered certain by law.

LPA 1925, s 146(6): a lease for life is statutorily converted into a 90-year term.

• This is only available when the parties intended a lease for life Southward Housing Coop v. Walker (2015)

3. Exclusive possession

Street v Mountford [1985]: Principles to establish exclusive possessnion

1. Substance, not form

• Principle 1: The courts look to substance, not form, of the agreement.

• Thus, an agreement labelled ‘licence’ can still be a lease (Watts v Stewart (2016))

2. Intentions:

• Principle 2: Not the parties' intentions that are relevant, but objective reading of the agreement

3. Exclusive possession

• Principle 3: : Right to exclusive possession not factual state of exclusive occupation. (Villiers)

• Not ‘does B have exclusive possession of flat’, but ‘can B legally exclude landlord & ors from flat’

4. Exclusive posessor rights

• Can exercise the rights of a landowner, which is in the real sense his land albeit temporarily and subject to certain restrictions”,

• can keep out strangers and keep out the landlord unless the landlord is exercising limited rights reserved to him by the tenancy agreement to enter and view and repair

• The occupier is a lodger [i.e., licensee] if the landlord provides services which require unrestricted access to … the premises

• landlord’s “express reservation of limited rights to enter to carry out services imply that tenant is entitled to exclusive possession. Otherwise, no need to reserve rights.

5. Relevant factors

• Principle 4: In assessing exclusive possession, I consider (1) the labelling of the agreement (2) the nature of the parties’ relationship and (3) provision of services but landlord’s “express reservation … of limited rights to enter and view … and to repair and maintain the premises only serves to emphasise … that the grantee is entitled to exclusive possession”, because if the grantee (tenant) hasn’t been granted exclusive possession, the grantor (landlord) has no need to reserve these rights.

Attempts to circumvent Street v Mountford [1985] : Shams and pretences

• Antoniades v Villiers [1990]

  • Principle 1: The test for exclusive possessions is one of entitlement to possession not whether one actually has exclusive possession.

  • Sham clauses are not there genuinely, serving only to bypass statutory protections.

• Nature of the property: Despite the agreement allowing L to let others stay at the flat, it only had 1 bed, which implied that neither party genuinely believed it. + no one...