DISTINGUISHING BETWEEN LEASES AND LICENSE
A license is essentially a permission given by the owner or occupier of land to another person to enter the land for some purpose, for example, to lodge in a room, to view a flim or to swim in a pool: acts which might otherwise amount to trespass.
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It is best to firstly explain what leases and licences are. There are two legal estate under the property act 1925 [2] , an estate in fee simple absolute in possession and a term of years absolute.
Tenure by a lease is an agreement that the tenant may enjoy exculsive possession for a specified period of time, also referred to as ‘term of years absolute’ [3] . The leaseholder may be designated as lessee, or termor [4] .
The leading authority for leases is Street v Mountford [5] , where the House of
Lords laid down the test (intention of the parties) for distinguishing a lease, or tenancy, from a licence. The House of Lords held that where the arrangement in question was intended to create legal relations, and the occupier was granted a right to exclusive possession of the premises for a fixed or periodic term at a rent, then a lease or tenancy arises. Anything else is a licence.
A lease creates a legal estate, the phrase ‘term of years absolute’ could be seen as contradicted through the case of Bruton v London & Quadrant Housing Trust [6] . It was held by the House of Lords that the case was of a special nature, the decision and outcome will be considered in more detail further in the essay. But generally a legal lease will create a legal lease.
The Law of Property Act [7] require for a fixed term not an indefinite term. In Lace v Chantler [8] there was a lease for an uncertain term, ‘for the duration of the war’ was held not to be a lease as it was not for a fixed term. A specific period like ‘for 60 years’ is a clear term which satisfies the Law of Property Act. Therefore, all that is required is a fixed period , in Cottage Holiday Associates Ltd v Customs and Excise Commissioners [9] the courts accepted
Top of Form
It is best to firstly explain what leases and licences are. There are two legal estate under the property act 1925 [2] , an estate in fee simple absolute in possession and a term of years absolute.
Tenure by a lease is an agreement that the tenant may enjoy exculsive possession for a specified period of time, also referred to as ‘term of years absolute’ [3] . The leaseholder may be designated as lessee, or termor [4] .
The leading authority for leases is Street v Mountford [5] , where the House of
Lords laid down the test (intention of the parties) for distinguishing a lease, or tenancy, from a licence. The House of Lords held that where the arrangement in question was intended to create legal relations, and the occupier was granted a right to exclusive possession of the premises for a fixed or periodic term at a rent, then a lease or tenancy arises. Anything else is a licence.
A lease creates a legal estate, the phrase ‘term of years absolute’ could be seen as contradicted through the case of Bruton v London & Quadrant Housing Trust [6] . It was held by the House of Lords that the case was of a special nature, the decision and outcome will be considered in more detail further in the essay. But generally a legal lease will create a legal lease.
The Law of Property Act [7] require for a fixed term not an indefinite term. In Lace v Chantler [8] there was a lease for an uncertain term, ‘for the duration of the war’ was held not to be a lease as it was not for a fixed term. A specific period like ‘for 60 years’ is a clear term which satisfies the Law of Property Act. Therefore, all that is required is a fixed period , in Cottage Holiday Associates Ltd v Customs and Excise Commissioners [9] the courts accepted