Land Law 2: Leases and Licences Outline

The street requirement Street v Mountford [1985]:

Single Occupancy:

Is there Exclusive Possession?

1) Definition: Exclusive possession is defined as the right to use premises to the exclusion of
all others including the landlord himself.

2) The case of Street v Mountford [1985] made emphasis on ‘substance over form’.

RESIDENTIAL CASES: Avowed wishes and labels are virtually irrelevant. (Aslan v Murphy
[1990]).
COMMERCIAL CASES: It will only be relied on if it is a last resort. Note that the court only
hinted that it may be relied on if parties have relative bargaining powers, prior legal advice
and had negotiated over the agreement. (Clear Channel UK Ltd v Manchester City Council
[2005]).

3) Are there any valid terms at odds with exclusive possession? Not pretences (Antoniades v
Villers [1990]/Huwyler v Ruddy [1996])

(A) Landowner can enter to provide services such as cleaning (Marchant v Charters
[1977])
(B) The Landowner can require the occupant to move to other suitable premises
(Dresden Estates v Collinson (1987)).
(C) The Occupant is required to vacate the property during particular times (Aslan v
Murphy [1990]).
(D) The landowner can enter the premises at any time to ensure compliance with the
terms of occupancy (Westminister CC v Clarke [1992]).
NOTE: Limitations on how to use the land and landlords limited rights to ‘enter, view and
repair’ are not at odds with exclusive possession.

4) Does the agreement expressly confers exclusive possession (Default position of

commercial) or can it be inferred (Default position of Residential)?

Are there facts or circumstances in the case which suggests that this should not be inferred/
Expressly conferred?
Residential: Monmouth BC v Marlog (1995), Camden LBC v Shortlife Community Housing
Ltd (1993) Commercial: London & Associated Investment Trust Plc v Calow (1987)

Multiple Occupancy:

1) Is there exclusive possession?

 (A) Is there a single, collectively held right of exclusive possession? (joint tenants of a
single leasehold)

The 4 Unities must be present:

(1) Unity of Possession: The agreement allows occupants a general right to
occupy the whole premises and affords them exclusive possession over the
whole area.

(2) Unity of time: The occupants interest commenced at the same time.

(3) Unity of Interest: The occupants are collectively liable for rent and terms of
agreement are the same (Mikeover Ltd v Brady [1989]).

(4) Unity of title: must be one signed document or signed separate agreements
but are interdependent. If the signed separate agreement is signed by people
unknown to each other, move in at different times under different agreements
and only move in as and when a room becomes available this unity will not be
held to exist (AG Securities v Vaughan [1990]).

(B) Is there a distinct right of exclusive possession of individual areas?’

The agreement must specifically state that their area/room is their own (AG
Security v Vaughan [1990]).

2) Are there pretences and avowed wishes?

Other Requirements:

(1) TERM: Two types of terms: (A) Fixed term (ends when the term ends)
(B) Periodic term (ends when a proper ‘notice to quit’ is given)

The agreement must be term certain (s205(1)(xxvii) LPA 1925)

-It is uncertain if the end date is not specified (Lace v Chantler [1944])
-It is uncertain if a periodic term states the landlord will not serve a notice for a
certain period of time and the period is unknown (Southward Housing Co-operative
Ltd v Walker [2015].

Note: If a fixed term was regarded as uncertain, a periodic term may be inferred if
the occupant moves onto the land and pay rent (Prudential Assurance Co Ltd v
London Residuary Body [1992]).

However, if the party is an individual, rent is payable and a lease for life is not clearly
contrary to the parties intention, according to s149(6) LPA 1925, this could be
construed as intending to create a lease for life (90 yr lease) (Mexfield Housing Co-
operative v Berrisford [2012]/ Southward Housing Co-operative Ltd v Walker
[2015]).
 (2) RENT: Rent is payment that is given in return for exclusive use of the premises
(Bostock v Bryant [1990]). Note: Expenses paid for are not considered rent (Same
case)

Note: Rent is not strictly necessary for there to be a valid lease. (s205 (i)(xxvii) LPA
1925 and Ashburn Anstalt v Arnold [1989]).

Are there any exceptions?

(A) There was no intention to create legal relations. Eg an act of charity (Booker v
Palmer [1942]).
(B) The occupant was a ‘service occupant’. Their licence ends with end of employment
(Norris v Checksfield [1991]). There are two conditions to be met to be classified as
a service occupant: (1) The occupation of the premises are part of the employment
and (2) it is of material assistance in the carrying out of his/her employment duties
(Carroll v Manek & Bank of India (1999)).

(3) Formalities:
Legal Lease: For a legal leasehold estate, it is necessary for there to be either: (i) a
deed (s 52(1) LPA 1925) and, sometimes, registration if it is for more than 7 years
s27 (2)(b)(i) LRA 2002; or failing that (ii) compliance with s 54(2) LPA 1925, for which
the lease must take effect in possession (Long v Tower Hamlets LBC [1998]), be for a
term not exceeding 3 years, and be for the best rent reasonably obtainable e.g
market value or higher (Fitzkriston LLP v Panayi [2008]).

Equitable Lease: If there is no legal lease, there may an equitable leasehold estate
(under Walsh v Lonsdale (1882) if there is a written agreement which is signed by
both parties, as required by s 2(1) LP(MP)A 1989.

Failing that, the agreement fails entirely to create a leasehold estate. If the party
meant to be the tenant moves onto the land and pays a rent, however, the courts
will readily infer that the parties intended a new periodic term, which will be legal
presuming that it comes within s 54(2) LPA.

Note: if the Street conditions are met but the grantor lacks any estate in the land,
there will be a purely contractual ‘tenancy’: Bruton v London & Quadrant Housing
Trust [2000]. It would seem that there are no formality requirements for such a
tenancy.

LASTLY WOULD A THIRD PARTY BE BOUND?

This will not be so if the right is only a licence: Ashburn Anstalt v Arnold [1989].

If there is a legal leasehold estate, it will bind any purchaser of the land. An equitable
leasehold estate will bind a purchaser if it is protected by a notice (s 32 LRA 2002) or, failing
that, if it is an actual occupation overriding interest.
2017 PQ

2015
- B becomes registered proprietor of VH&A
Feb 1st
- B offers L occupancy of annexe for ‘up to three years’ no rent is paid in return. But L
agrees to keep annexe lean & do odd jobs
rd
Feb 3
- R&J sign separate but identical documents headed ‘occupancy agreement’ with the
terms
o Term of 3 years
o Rent = 3600 / y payable at 300/m
o B will ensure that the lounge is cleaned at least once each fortnight
Feb 6th
- R&J move in
- R&J Refuse B’s service

2017
- B sells VH&A to T
- T tells L to vacate
- T Demands J Pay entire rent.

Issue 1: Is L obligated to Vacate?

Regarding Laurence, Benvolio has provided that he could occupy the annexe for up
to three years, and he is not obligated to pay rent, but he agreed to perfrom odd jbos, and
clean at B’s request. To determine what rights L has, it must first be determined if he has a
lease or a liscence agreement. The case of Street v Mountford has outlined that to establish
a leasehold there must be exclusive possession, term, and rent. In Multiple occupancy
situations, regarding exclusive possession, the rule that will be followed regarding L will be
that of AG secerity v Vaughn since there is no collectviley held right of EP, with R&J. the rule
in AG security determines that to determine EP the agreement must specifically state that
their area / room is their own. This is the Case for Laurence since his verbal agreement with
B established that he can occupy the Annex. However, there was a pretence and avowed
wishes attached which was that he would complete odd jobs / clean the lounge. Second is
the requirement of term, it can be inferred from B’s wording that the term was intended to
be periodic since he said ‘up to three years’ instead of ‘for three years’. Finally, the aspect of
rent must be satisfied. While L is not paing a rent, s205 (i)(xxvii) LPA 1925 and the case of
Ashburn Anstalt v Arnold establish that rent is not strictly necessary for there to be a valid
lease. So far it appears that a valid leasehold agreement can be found for B. however, it
should be noted that because the term was periodic, it would be reasonable to say that it is
within T’s right to end the lease and that L’s occupancy would come to an end at the notice
of termination.

Issue 2: Is J obligated to pay entiriety of rent

 Regarding T’s request to pay the entirety of the rent, this does not appear to be a
vilid request purely because from the outset R&J had signed separate agreements.
However, some considerations should be made, primarily that in 2015 B had noticed that
R&J were holding hands, and treating the space as a joint space. Additionally, R described
the duo as inseperable, and that the second bedroom would serve as a study, meaning they
would be sharing one bedroom. This may indicate that they are a couple and generally, the
courts when considering the unity of title will treat the title as a single document even
though separate agreements. Which would make Juliet jointly liable for Romeo. If L comes
to learn this, and proceedings with court, the Court may consider this, and require J pay for
R’s portion of the rent.