Leasehold Estates:
The Leasehold Estate
Three kinds of leaseholds:
Term of Years
Periodic Tenancies
Tenancies at Will
The Term of Years – an estate that lasts for some fixed period of time or for a period computable by a formula that results in fixing calendar dates for beginning and ending, once the term is created or becomes possessory.
The period can be one day, two months, five years, or 3000 years. There are all terms of years.
At common law there was no limit on the number of years permitted, but in some American states statutes limit the duration of terms of years.
A term must be for a fixed period, but it can be terminable earlier upon the happening of some event or condition. Because a term of years states from the outset when it will terminate, no notice of termination is necessary to bring the estate to an end.
Death doesn’t terminate a term of years.
Terms of years have two elements:
1. Ascertainable beginning
2. Fix end period
The Period Tenancy
A periodic tenancy is a lease for a period of some fixed duration that continues for succeeding periods until either the landlord or the tenant gives notice of termination. Death doesn’t terminate a periodic tenancy.
E.g. to A from month to month, to B from year to year
Notice: Renewal continues indefinitely until timely notice is given.
For a month to month period, notice must be given by at least 1 month but can’t exceed 6 months
For a year to year period, notice must be given by 6 months.
The Tenancy at Will
A tenancy of no fixed period that endures so long as both landlord and tenant desire. The death of either party terminates the tenancy. Two elements:
· Indefinite period
· Mutual right to terminate
The Term of Years of Determinable – unilateral power to terminate a lease engrafted on a term of years or a periodic tenancy.
Ex. Lease by L to T for 10 years or until L sooner terminates.
Tenancy at Sufferance – arises when a tenant remains in possession (holds over) after termination of the tenancy. Common law rules give the landlord confronted with a holdover essentially two options – eviction (plus damages), or consent (express or implied) to the creation a new tenancy.
Garner v. Gerrish (Pg. 365) –
Landlord and tenant enter a lease which says the tenant can terminate the agreement at a date of his own choice. The lease also says the landlord has a right of reentry if the rent is not timely paid. Issue over whether lease given was tenancy at will or term of years determinable. A conveyance that only gives the tenant the right to terminate at will is a determinable life estate, not a tenancy at will. It is simply a life estate terminable at the will of the tenant. Court holds tenancy for life since otherwise would contradict agreed upon K terms. J/Defendant. – “Quasi-Tenancy at will”
Crechale & Polles, Inc. v. Smith (Pg. 369) —
Term of years for 5 years. Tenant stays the entire term and then requests to stay on a monthly basis. Landlord refuses. Tenan
y)
Implied warranty of habitability (See Hilder)
Duty not to engage in retaliatory eviction
Tort liability for injuries to tenants or other persons (only if exceptions are met)
Delivery of Possession (Landlord Duty #1)
Hannan v. Dusch (Pg. 384) –
Tenant and landlord agree on a lease. Come time for the lease to begin, previous tenant is wrongfully holding over. Tenant sues landlord claiming that the landlord not only has a right to deliver legal possession, but to deliver physical possession as well. Court cites two opposing views:
English Rule – the courts imply a covenant requiring the lessor to put the lessee in possession
American Rule – recognizes the lessee’s legal right to possession, but implies no such duty upon the lessor as against wrongdoers. If a person wrongfully holds over, the rightful tenant has an action against the stranger, not the lessor.
The court adopts the American rule and says the landlord has no duty to deliver physical possession, only legal. Tenant must take action against the tenant who is wrongfully holding over.
Note: Today, majority of courts would apply the English Rule since the landlord has more than $ than tenant and is in better position to bring action.
