What is a lease?

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Property lawyer Terese Kingman takes a look at leases and answers some commonly asked questions.

What is a lease?

A lease is a legally binding contract between a landlord, who owns the freehold of a property, and a tenant. The tenant should have ‘exclusive possession’ of the property which is the subject of the lease and the lease will be for a ‘certain term’, for example a lease for 6 months or for 999 years.

What is a fixed term lease?

Most leases are for a fixed term, usually ranging from 3 years to 999 years. The lease will finish at the end of the fixed term.

What is a periodical tenancy?

A periodical tenancy is an tenancy agreement between a landlord and a tenant for a period of time, for example, a week, a month, six months, a year etc. The main characteristic of a periodical tenancy is that at the end of the given period the tenancy automatically renews itself until either the landlord or the tenant serves notice to end the tenancy.

Is a landlord obliged to keep a dwelling house fit for human habitation whilst let to a tenant?

Yes. Under the Landlord and Tenant Act 1985 a dwelling house must be fit for human habitation throughout the tenancy. However, this is usually expressly provided for in the lease.

Is Rent an essential requirement of a lease?

No, but if a rent is charged it does suggest that a contractual arrangement exists between the parties.

Why would a lease include a rent review clause?

A landlord will not usually want the rent to remain the same throughout the term of the lease if it is for a long period. Landlords generally want to ensure that tenants are paying a going market rent. Rent reviews are particularly common in commercial leases.

When will a landlord be allowed to forfeit a lease?

Forfeiture normally arises for either non-payment of rent or breaches of covenants. However, the landlord can only forfeit a lease if there is a clause in the lease which allows him the right of re-entry if the tenant breaches a covenant. A residential lease will usually allow for the landlord to give notice to the tenant and his mortgage lender before he exercises his right of re-entry. A tenant can apply to the court for relief if the landlord is acting unfairly.

Can a landlord prevent a tenant from sub-letting the premises?

It depends on whether there is an absolute or qualified covenant not to assign or sub-let in the lease. The former means a landlord can prevent a tenant from sub-letting. The latter means that the assignment cannot take place without the consent of the landlord. In this instance a landlord is not entitled to withhold his consent unreasonable.

If you have any queries concerning leases or leasehold property please contact Terese Kingman on 01769 575982 or email her at [email protected]