Land Law: Analysing Leases and Licences with Property Guardianship

This essay provides a comprehensive analysis of the legal distinctions between leases and licences within the context of land law, with a particular focus on the complexities introduced by property guardianship schemes. It begins by establishing the fundamental differences between a lease, which grants exclusive possession for a fixed term, and a licence, which offers a more flexible and often temporary right to occupy property. The essay then explores the legal requirements for creating a lease, including the mutual intention of the parties, exclusive possession, and a fixed term with rent. It also outlines the characteristics of a licence, highlighting its contractual nature and lack of protection under various housing acts. The essay further examines the impact of case law, such as Street v Mountford, in determining the nature of the agreement. The discussion then extends to the challenges posed by property guardianship, including the lack of a statutory definition and the potential for confusion regarding the rights and responsibilities of guardians. The essay also explores the implications of these arrangements, particularly in relation to the classification of properties as houses in multiple occupation and the impact on business rate liability. It concludes by emphasizing the importance of clear legal drafting to avoid inadvertently granting exclusive possession to occupiers and to ensure that the intentions of the parties are accurately reflected in the agreement.

LEASES FOR LAND LAW

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
ESSAY ............................................................................................................................................1
REFERENCES................................................................................................................................5

INTRODUCTION
Government do not encourage or endorse use of the property guardianship schemes as the
form of the housing tenure, as the guardians could be asked for living in conditions which do not
meet standards expected from residential properties, people have right of making informed
decisions of their own relating to housing choices. Property guardianship agreement usually are
licenses for occupying, that differs from the residential tenancies. The focus of essay is to draw
distinction between licence and lease and to analyse challenges posed by the property
guardianship and whether they have led to further difficulties to determine the difference
between lease and licence with an individual.
ESSAY
Issue
Understanding difference between the licence and lease in the property is essential for
considering the type of arrangement. Both of the terms moreover seems as same but there is
difference between the two in jurisdiction (Ferreri, Dawson, and Vasudevan, 2017). On concept
is formal where other offers flexibility and also alternate solutions for being tied into lease
agreements. It is informal agreement that is purported as beneficial for all the parties involved.
Issue here is to make distinction between lease and licence in property custodianship.
Rules
Lease
It is formal contract between the owner of property and occupier of property that provides
detailing of the specific obligations for each party in arrangement. Lease outlines key terms of
occupation of premises like amount of rent and length of the occupancy, along with
responsibilities for every party for keeping premises in the working order. Lease creates
proprietary in land and is enforceable against the third parties. There is also protection under
Housing Act and could not be terminated without proper notice for quit. Three elements are
required to be satisfied for considering it as lease (Ferreri, Dawson,2018). 1)Landlord and tenant
needs to have mutual intention for entering into legal relationship. 2) Tenant needs to have
exclusive possession of property; and 3) There needs to be fixed term of the occupation with
fixed rent or rent review process.
Licence agreement
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Licence agreements are contractual agreements between the licensee and licensor that is
used commonly when specific part of property or have temporary access to property of the
licensor. Licence has the enforceability between parties to it and has no protection under Rent
Act 1977 and Housing Act 1988 & 1996 and is also terminable through common laws at shorter
notice. Two elements are there that are to be satisfied for considering the license agreement.
Parties have mutual intention of entering into legal relationship and Licensee do not have the
exclusive possession of property
Implementation of Rent Act, 1977 led the landlord to create licences instead of giving
occupier a limited protection. Statutory provisions for the leases are less extensive now than in
1970s and 80s but legacy of distinction between licence/ lease lives on.
The case of Street vs Mountford [1985] has confirmed that grant of the exclusive
possession for term creates lease as opposed to licence, regardless of what parties have labelled
arrangement. The legal distinction in licence and lease are of fundamental importance, it has
significant implications for anyone occupying or owning premises.
Legal and Equitable Lease
Sect 1 of Law of Property Act 192 recognises the leases as estate in the land capable of
existing in law. Sect 52 of LPA, 1925 requires that lease needs to be created by the deed to be
legal. Expressly created equitable lease needs to be in the writing compliant with the sect 2 Law
of Property Act, 1989. While unregistered legal lease binds and purchaser of superior estate
could not take free of lease. Lease of the less than 7 years would override if it is legal. Longer
leas needs to be registered. Equitable lease could be created deliberately and it will give rise to
non completed contracts for lease and also result due to flaws in execution of deed of the lease.
Legal lease bind world whereas the equitable leases are vulnerable to the third parties if they are
not registered as land Charge. Properly protected legal leases are invulnerable to the third parties.
Application
In the case of Camelot Property Management ltd vs Roynon [2017], case concerned the
property guardians related with tenant or licensee. In this Camelot was property guardian firm
and work of the company was to arrange for guardians for living in the empty commercial
properties. It arranged persons for disused property of elderly care home in the Bristol, and one
individual was Roynon. In this there was written agreement between parties stating such
agreement will be licence that allows Roynon for having shared right for occupying property.
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Contract, not included express reservation in favour of company like right to enter (Meers, and
Hunter, 2020). Roynon had possession of 2 rooms and not allowed access to them. Due to this,
notice was served by company to quit Roynon and as he refused for vacating place.
Court in this case held that the Roynon, have exclusive possession of two rooms of
property that was locked. Camelot could conduct the visual inspections and these equated
Camelot to retain right for access and thus Roynon had exclusive possession of the area.
Restrictions paced over Roynon in written agreement of licence restricted only manner of using
room and terms were sufficient for defeating exclusive possession. Drafting of the license needs
to be completed with the utmost caution. Licence is construed as lease as in above case where it
is granted for more than 6 months and licensee is capable to claim as tenant for protection
provided under Landlord and Tenant Act, 1954.
In another case of Watts vs Stewart [2017], the court upheld decision of court at first
instance and also did not accepted that Watts had the exclusive possession of flat. The exclusive
legal possession allows occupier for excluding all the other, including owners, from property and
Watts did not had this right. Merely having personal license for occupying flat is subject to the
various laws and regulations.
It has to be remembered that initiating license or lease relationship, intention of parties
needs to be clearly outlined and legal drafting in the watertight for ensuring that occupiers are
not given inadvertently exclusive possession of part or whole of property.
Landlord could call agreement as licence and it will not impact if the criteria as provided in case
of Street v Mountford have been satisfied. Landlord can negate the exclusive possession through
insertions of some clauses that landlords do not acts on like in the case of Murphy vs Aslan It
will take form of the false promises of providing services or attendance (Wickes,2018). If
relationship between the landlord and person are purely and entirely out of generosity or
friendship lease may not exist even if criteria specified in case of Street vs Mountford have been
satisfied.
Similarly, even if criteria specified in case of Street v Mountford are also satisfied, lease
may not exist if relationship between the parties is not of tenant and landlord.
Property Guardianship
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Official or statutory definition of property guardians are not there. This is accepted
widely that the property guardian is party entered in the agreement for living in building or part
which would be empty otherwise for primary purpose to secure and safeguard property.
Property guardianship usually offers licence to occupy and licence is contractual right for
occupying the premises in return for payment of the license fee. It arises when the exclusive
rights for possession and also the intention of entering into legal relationship of the tenant and
landlord. Tenancy arises when landlord grants the legal right for exclusive possession of the
premises for specified period of the time, in return for payment of the return.
Challenges of Custodianship
When the guardians tries to enforce the repairs against the landlords cases are governed
by both the models, judges decide about the tenant while parliament decide on protections
offered to tenant. Potential issue of guardian occupied properties are classified as the houses in
the multiple occupations as they tend to occupied by the more than two households that share
one or more amenities.
Property owners are required to be aware that questions about whether the guardianship
schemes will be mitigating the business rate liability depends on who is under rateable
occupation of property. Leaving commercial property empty for months with significant risks for
owners of property. Owners also needs to consider whether these risks are also outweighed by
benefits of property guardianship (Grohse, 2020). These arrangements are bringing their own
issues and the property owners could prefer to keep the control of arrangements made for the
empty property.
In the end, it could be concluded that the new laws have increased the problems for
making distinction between lease and a license.
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REFERENCES
Books and Journals
Ferreri, M., Dawson, G. and Vasudevan, A., 2017. Living precariously: property guardianship
and the flexible city. Transactions of the Institute of British Geographers. 42(2). pp.246-
259.
Ferreri, M. and Dawson, G., 2018. Self-precarization and the spatial imaginaries of property
guardianship. cultural geographies.25(3). pp.425-440.
Meers, J. and Hunter, C.M., 2020. The face of Property Guardianship: Online property
advertisements, categorical identity and googling your next home. People, Place &
Policy online.
Wickes, R.,and et.al., 2017. Neighborhood guardianship and property crime victimization. Crime
& Delinquency. 63(5). pp.519-544.
Grohse, I.P., 2020. Guardianship of Minors’ Property in Medieval Norse Law. In Nordic
Inheritance Law through the Ages (pp. 53-70). Brill Nijhoff.
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