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Property I
University of Tennessee School of Law
Hess, Amy Morris

Property Outline
 
What you own when you own property is a bundle of rights or “a bundle of sticks”
 
Landlord and Tenant
 
The leasehold Estates-
Leasehold Estates:  The tenant has a present possessory interest in the leased premises, and the landlord has a future interest (reversion)
 
Principle Types of Leaseholds:
1)      Term of Years: an estate that lasts for some fixed period of time. Has a fixed calendar dates for beginning and ending.  
a.       Creation: 
                                                              i.      Normally created by written leases. 
                                                            ii.      You can also have an unfixed beginning, but once the lease starts the end becomes clear. An example of this would be if the building is under construction or renovation.
                                                          iii.      Term of years doesn’t have to be for an actual term of years. It’s for any fixed period. If it’s more than a year, the statute of frauds applies, and it has to be in writing.
b.      Termination: 
                                                              i.      The death of the landlord or tenant has no effect on the duration.
                                                            ii.      The term of years ends automatically, and no one has to give notice to anyone else.
                                                          iii.      If one party breaches, the other party may have a right to terminate early. (failure to pay rent)
                                                          iv.      Surrender: Consists of the tenant giving up his leasehold interest to the landlord and the landlord accepting. (writing is necessary if the unexpired term is more than one year)
c.       A lease failing as a term of years, becomes either a periodic tenancy, a tenancy at will, or a license, depending on the particulars of the lease and the case.   
2)      Periodic Tenancy: a lease for a period of some fixed duration that continues for succeeding periods until either the landlord or tenant gives notice of termination. (for fixed period & keeps renewing until someone terminates it (“energizer bunny”) 
a.       The beginning date must be certain, but the termination date is always uncertain until notice is given
b.      Lease can begin on any day
c.       All conditions and terms of the tenancy are carried over from one period to the next unless there is a lease provision to the contrary. 
d.      Creation: 
                                                              i.      By Express Agreement
                                                            ii.      By Implication: if the lease has no set termination but does provides for the payment of rent at specific periods. 
                                                          iii.      By Operation of Law:
1.      Tenant Holds over
2.      Lease invalid
e.       Termination: 
                                                              i.      The death of the landlord or tenant has no effect on the duration.
                                                            ii.      It automatically keeps renewing until one party terminates it. There are termination rules. Either party can terminate it.
                                                          iii.      If notice not given, period is automatically extended for another period If either party wants to terminate, they have to give advance notice, at least as far in advance as the period (maximum of 6 months).
                                                          iv.      At common law, the lease could only end on the end of a period, not the middle of a month. You have to end on a renewal date.
1.      On week-to-week, it would end whenever the end of the week is.
2.      A month-to-month period does not have to be a calendar month.
                                                            v.      Under Uniform Landlord Tenant Act, 66-28-512, week-to-week must give 10 days notice to terminate, and month-to-month must give 30 days.
3)      Tenancy at will: a tenancy of no fixed period that endures so long as both landlord and tenant desire.
a.       If the lease gives only the landlord the right to terminate, a similar right will generally be implied in favor of the tenant so that it creates a tenancy at will. However, if the lease is only at the will of the tenant, courts usually do not imply the right to terminate in favor of the landlord. (they normally interpret it as conveying a life estate or fee simple.)
b.      Creation: 
                                                              i.      Unless the parties expressly agree to a tenancy at will, the payment of regular rent will cause the court to treat the tenancy as a periodic tenancy.
c.       Termination:
                                                              i.      It ends at the death of one of the parties or when one of the parties terminates it because it requires mutual will.
                                                            ii.      Either party may terminate.
                                                          iii.      Requires Mutual Will for the relatio

ion, and the landlord has to stick with that decision.
 
A good lease will specify what will happen if the tenant holds over. All of these provisions only apply when the lease is silent. 
 
When a tenant continues in possession after the termination of his lease, the landlord can either to evict him, treat him as a trespasser, or to hold him as a holdover tenant.
 
Courts are hesitant to enforce long, implied tenancies. If they do find a holdover tenancy, they’re likely to find one for the shortest period. They will choose a month over a year lease.
 
What do you do as the landlord’s lawyer and you & landlord want to say that they are not a tenant but you also want the money for the time they stayed? Landlord in a bad position. The landlord has to tread carefully. 
They have to evict them quickly OR
If they decide to let them stay make sure the tenant only gets month-to-month lease. 
 
The Lease
Some Considerations When Determining Whether Something is a Lease:
1)      Intention of the parties
2)      Looks like a lease
3)      Duration (shorter looks like a license, longer looks like a lease)
4)      Number of restrictions on use
5)      Exclusivity of possession (By and large, leases are more exclusive than licenses.)
6)      Nature of the rent obligation
7)      Degree of control retained by the granting party
8)      Presence or absence of incidental services
9)      The use of the word “lease” is good evidence, but it’s not necessarily going to control the outcome.
 
Why does it matter if it’s a lease or a license?
1)      It matters if it’s a lease or a license b/c tenants get more rights under a lease.
2)      Some states require tenants to pay tax on lease. There, it matters if it’s a lease or not b/c that determines whether you have to pay taxes.
3)      Sometimes there are issues w/ whether a person is an employee or tenant if their employer provides them w/ housing as part of their compensation. If it’s a lease, you can have guests. If you’re an employee, you can’t.
 
Selection of Tenants (Herein of Unlawful Discrimination (pg 460-464)