I. LANDLORD-TENANT
A. Leasehold estate
1. 2 types of present estates-
a. Freehold estates- forms of “owning” land (title passes)
i. Fee simple
ii. Life estate
iii. Fee tail
b. Non-freehold estates or leasehold estates- forms of “leasing” land
2. Definition- legal interest that entitles the T to immediate possession of designate land, for a fixed pd. of time or for as long as the T and LL desire
3. Distinction b/t leasehold estate and non-possessory interest
a. Leasehold- right of exclusive possession and use
b. Non-possessory, mere right to use in a particular manner (easement)
c. Revocable privilege to enter land temporarily for a specific purpose (license)
d. Difference b/t possession and use
i. Whether the party occupies a specific, distinct area
ii. How much control a party has over the area
iii. Whether parties used lease-like terminology and provisions in defining their relationship
4. Categories (almost all leasehold estates are term or years or periodic)
a. Term of years
i. Advance agreement that will continue for a designated pd.(can be days, weeks, months, or years)
ii. Beginning and end dates of max. lease are fixed
iii. Automatically expires when agreed pd. ends, w/out any notice of termination
iv. LL can terminate tenancy upon T’s breach of specific lease terms
b. Periodic (month-to-month is most common)
i. Initial fixed pd. and then automatically continues for additional equal pds. until LL or T terminates tenancy by giving advance notice (no fixed ending date)
ii. Many arise by implication based on conduct of parties (paying rent)
iii. Common law- LL or T could terminate for no reason at all simply by giving advance notice to the other party
iv. Today- governed by state statute
* Particular form of written notice given in a particular manner
* 30 day notice to end month-to-month leases
* 2-3 mo. for yr.-to-yr. leases (6 mo. at common law)
* Majority rule- common law approach that tenancy ends on the last day of the fixed pd.
* LL can still terminate for no reason w/ advance notice, but not for an improper reason such as discrimination or retaliation
1. Retaliation looks at protected T conduct & prohibited LL conduct
* LL can also terminate for a material breach of T’s obligations
c. Tenancy at will
i. No fixed duration and endures only as long as both LL and T desire
ii. Most arise by implication
iii. Common law- tenancy ended at will whenever LL or T chose through notice or conduct of the parties
iv. Today- statutes
* 30 day advance notice→ periodic tenancy
v. If T beings making monthly rent payments that LL accepts, a ct will conclude that the parties conduct gives rise to a mo-to-mo tenancy (periodic tenancy)
d. Tenancy at sufferance
i. Not a true estate in land, so no notice needed to terminate (evict any time)
ii. No LL-T relationship
iii. Person in rightful possession of the land wrongfully continues in possession after that right ends
iv. LL can recover damages for pd. of wrongful occupancy measured by fair rental value or prior rent
v. Holdover tenant- most common form of tenancy at sufferance
* T remains in possession of leased premises after leasehold estate ends
* At the LL’s discretion, done through notice or conduct, LL can:
1. Evict T as a trespasser, or (traditional common law rule)
2. Hold T to a new tenancy (traditional common law rule)
3. Modern law-
a. LL is obligated to mitigate damages
b. Holdover- charge a prorated rent if holdover was unintentional or double the rent during the holdover period (look to state statutes or LL may be able to charge whatever rent they want)
c. Length of the new tenancy- maximum term for a holdover tenancy is 1 yr. regardless of the original lease term
i. Opinions split when shorter term or period is applicable
* Is it a periodic tenancy or term of yrs?
* Is the term 1 yr or 1 month?
B. Lease as a conveyance
1. Common law
a. Lease- conveyance of an estate in land
b. LL transferred his right to possession of specific land to T (1-time event)
c. Consequences
i. T had sole duty to repair and maintain any structures on premises
ii. T was required to pay rent
iii. T was required to continue tenancy and pay rent even if LL breached any lease obligations
iv. LL had no duty to mitigate damages if tenant abandoned premises
2. Trend in treating residential leases as a K instead of as a conveyance (commercial leases are still treated as conveyances)
a. K approach honors legitimate expectations of the parties
b. Equitable principles
i. LL is obligated to maintain premises
ii. T has no obligation to pay rent if crucial structures are destroyed
iii. T may terminate if LL breaches any lease obligations
iv. LL may be obligated to mitigate damages if T abandons premises
C. Covenant of quiet enjoyment and eviction
1. Covenant of quiet enjoyment (non-disturbance)- covenant insuring against consequences of a defective title or any other disturbance of the title; T won’t be evicted
a. T shall quietly, hold and enjoy the leased premises
b. Paramount title- any rights in the leased premises that may be inconsistent w/ T’s rights as created by the lease, that are held by a 3rd pty at the time the lease is made, and which the LL cant terminate by the time T is entitled to possession (LL breaches QE if holder of PT interferes w/ T’s possession
i. Examples- liens, mortgages, easements
ii. Subordination Non Disturbance Attornment (commercial, not residential setting)
c. Breach of quiet enjoyment- T must show:
i. Active interference w/ its possession or interference that results from inaction in the face of an independent duty to act, and
ii. The interference is attributable to the LL and LL’s agent or paramount title holder, then the LL has breached the covenant of QE, and T will have available the std K remedies for breach
2. Constructive eviction- if T promptly departs premises as a consequence of breach of quiet enjoyment, departure makes the breach a constructive eviction and terminates the leasehold estate and the lease contract
a. Breach must be intentional, substantial interference, permanent, and T abandoned premises w/in a reasonable time
b. T leaves leased premises due to conduct by LL which materially interferes w/ T’s beneficial use of the premises→ T is released from obligation of paying rent
c. 2 issues
i. What is wrongful conduct?
* Acts and omissions of LL
* Conduct by 3rd parties
ii. What conduct substantially interferes w/ T’s use and enjoyment?
* Definition
* Partial constructive eviction- LL’s conduct substantially interferes w/ T’s possession of a portion of the premises
1. Majority rule- T who remains in partial possession can’t claim constructive eviction
2. Minority- recognize partial constructive eviction: when LL’s wrongful conduct substantially interferes w/ T’s use and enjoyment or part of the leased premises, T need only vacate that part in order to rely on constructive eviction
d. Remedies
i. Terminate lease and sue for damages
ii. Remain in possession and sue for damages
e. Limitations on constructive eviction doctrine
II. CREATION OF
avoided by the LL waiving his right to refuse consent or by being estopped from using it
c. Justifications for the Majority Rule
i. Freedom of ownership and control over one’s property (bundle of sticks; right to exclude)
* If you want this and you’re in a minority rule jurisdiction, you have to put it in the lease
ii. Approval clause gives LL discretion (should be used in good faith and fair dealing: minority response)
iii. Stare decisis
iv. LL has right to realize increased value of the property (increase in value properly belongs to the LL)
v. CA statute: LL can shift burden of mitigating damages to the T
2. Minority view- where a lease provides for assignment only w/the prior consent of the LL, such consent may be w/held only where the LL has a commercially reasonable objection to the assignment (trend is going toward this view)
a. Reasonableness- determined by comparing the justification for a particular restraint on alienation w/ the quantum of restraint actually imposed by it
b. Determining whether refusal of consent was reasonable-
i. Stds. of good faith
ii. Financial responsibility of proposed assignee
iii. Legality of the proposed use
iv. Suitability of proposed use
c. What is unreasonable?
i. Denying consent solely on basis of personal taste or convenience
ii. Denying consent in order that the LL may charge a higher rent than originally contracted for
c. ASSIGNMENT- if T transfers its entire remaining interest (right to possession)
i. Assignment triangle- LL leases to T, then T assigns his interest to the assignee
* Lease from LL to T created to independent legal relationships
1. Privity of contract- relationship b/t 2 parties who enter into a K
a. Arises b/t LL and T and then again b/t T(assignor) and assignee
b. No privity of contract b/t LL and assignee, unless assignee expressly agrees to assume T’s obligations under the original lease
2. Privity of estate- property law label for the relationship b/t 2 parties to the conveyance of an estate in land
a. Dissolves prior privity of estate b/t LL and T when T transfers his entire interest to the assignee and creates a new privity of estate b/t LL and the assignee
i. LL and assignee can sue each other if covenants of the original lease are breached
ii. Rights and duties of the parties
* Privity of estate confers rights and duties on assignee and LL: each is obligated to perform those covenants of the original lease that “run w/ the land” as real covenants or equitable servitudes (tool for enforcing private land use restrictions)
1. Most covenants in most leases “run w/ the land”: almost
