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Leases Notes

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Land Law Reading Week 3 Introduction

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Exclusive possession; for a limited term; in return for rent (not any more: Skipton BS v Clayton)- Street v Mountford

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NB the standard definition of exclusive possession for a limited term is applied when the tenant (B) is simply claiming a lease for the purpose of showing that he has a proprietary right e.g. against TPs. However where B claims that the landlord (A) granted him a lease because B wants to bring himself within the protection of a statute, the courts tend to distort the test to fit their beliefs about whether B ought to come within the statute (policy question). McFarlane categorises this as doctrine vs practical convenience.

'Exclusive possession, rent, term' Gardner: Work out in two steps if there is a lease. (1) on face value is there a lease contract and (2) if not, are the aspects preventing it from being a lease a "sham/pretence". NB Lord Templeman tends to run these together. Exclusive possession

* Vis-a-vis the landlord - 'tenant' or 'lodger'?
Street v Mountford [1985] AC 809; [1985] Conv 328, [1986] Conv 39, [1985] CLJ 351: D granted P a right to exclusively occupy a house at a weekly rent, terminable on 14 days notice, and which purported to be a licence. HL held that where, as here, residential accommodation had been granted for a term at a rent with exclusive possession, the grantor providing neither attendance nor services, the legal consequence was the creation of a tenancy. This is regardless of incorrect labelling. Lord Templeman: Unrestricted access of the landlord or his servants to the property means that the occupier will be a lodger, and not a tenant, since there is no exclusive possession. Aslan v Murphy [1990] 1 WLR 766: Cases where the Ps were paying rent for accommodation to Ds, and the agreements stated that they did not have exclusive possession and would have to share the property with other people to whom Ds might give possession, as well as stating that the freeholder would keep keys. CA held that Ps were tenants since, on a true construction, there was "exclusive possession" (definite periods and rents were not in contention). If the true bargain was that the defendants were entitled to exclusive possession of the premises unless and until the plaintiffs required them to share their occupation, the defendants were tenants. Here the claims that Ps could

be forced to share possession was a pretence, while the retention of keys by D was ineffective. Lord Donaldson MR: "Provisions as to keys, if not a pretence which they often are, do not have any magic in themselves. It is not a requirement of a tenancy that the occupier shall have exclusive possession of the keys." What matters is the reason for having the keys, e.g. quickly entering in the case of a fire. Exclusive possession is determined on the facts: Here Ds were taking no serious steps to try and find other occupants and was not treated as a serious possibility. Therefore it must have been pretence. Westminster City Council v Clarke [1992] 2 AC 288: P let D have a room in a hostel as he was homeless, it could oblige him to share his room with other homeless people at any given point and could be evicted if he caused nuisance to other residents immediately, or otherwise if he caused nuisance. HL held that it had been legitimate for P to limit D's rights to those of the lodger having regard to the circumstances and the purpose of providing D with a room. Lord Templeman: It was in both D's and P's interest that occupants should not have exclusive possession or tenancy: If one room became uninhabitable e.g. flooded, the council could move the person staying in that room into another one that could be shared. Hence there was actually a practical reason to deny exclusive possession, unlike in Aslan. Also the objective of providing temporary accommodation until occupants could find elsewhere to live is more consistent with a license than a tenancy. "This is a very special case which depends on the peculiar nature of the hostel maintained by the council, the use of the hostel by the council, the totality, immediacy, and objectives of the powers exercisable by the council and the restrictions imposed on Mr. Clarke. The decision in this case will not allow a landlord, private or public, to free himself from the Rent Acts or from the restrictions of a secure tenancy merely by adopting or adapting the language of the licence to occupy." Bruton v London and Quadrant Housing Trust [2000] 1 AC 406: X, a local authority, gave D a licence to use some buildings due for redevelopment to temporarily house homeless people, but not exclusive possession. P signed an agreement with D, allowing him to stay in a property alone on a temporary weekly basis, but that he would have to vacate upon notice from D. D had the right to enter to make repairs and inspect the premises. When the property was in disrepair, P claimed he was a tenant and therefore that D had a statutory duty to effect repairs, for which he sought an order of specific performance against D. HL held that there was a tenancy, since there was exclusive possession for a definite period in return for consideration. The tenancy would be in personam, since the person purportedly granting exclusive possession (D) did not have exclusive possession himself before granting it to P!
Lord Hoffmann: A tenancy is where "one person gives another the right to exclusive occupation of land for a fixed or renewable period or periods of time, usually in return for a periodic payment in money." He says it is irrelevant that the trust had no authority to grant leases, since this is not pleaded here. This decision is bad for policy reasons: it is

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