Land Law- Sem 1

Street v Mountford

Facts: 

• Wendy Mountford and her husband lived on the top floor of a house in Poole divided into flatlets- Owned by Roger Street, a solicitor. 

• An agreement was signed in 1983 

  • Payment of £37 a week 

  • Ban on anyone but them occupying the rooms without prior permission 

  • Right on owner's right to enter rooms for inspection 

  • Clean and tidy 

  • Agreement terminable on 14 days notice. 

• The agreement was titled 'license' agreement- didn’t give them tenancy. 

• Tenacy was protected under Rent Acts- security of tenure (right to stay as long as you occupy), fair rent without being affected by conditions of scarcity. 

• Under the Rent Act 1977 s1- tenancy under a dwelling which is let as a separate dwelling is a protected tenancy. 

• Issue: did the agreement create a lease? 

• Two opposing arguments:  

1. Street- subjective intention is paramount- intent of license by signing contract 

2. Mountford- objective test- once certain qualities are present, there is a lease 

• The decision: they decided that a lease is an arrangement which confers exclusive possession, for a term, at a rent. They adopted the objective test. 

What is a lease?

A lease is distinct from a freehold, which is indefinite in length but a lease is time limited. 

Leasehold estate- control of property is defined by the time of the lease. Carved out for a set period of time. 

License- permission. Gives no property interest by itself.

Aslan v Murphy [1989] 

Facts: 

• Murphy occupied small basement room owned by Aslan 

• Contract stated it was a 'license fee'- owner retained keys, occupant must vacate room for 90 mins each day and the owner permitted others to use the space. Essentially stating that Murphy did not have exclusive possession. 

• In practice, no other people were permitted to use the room and the daily exclusion rule was never enforced. 

Held: 

• Applied substance over form approach (Lord Templeman) 

• Daily exclusion and sharing terms were not exercised 

• Retaining a key is not determinative, it depends on how it is used 

• Thus, Murphy was a tenant with exclusive possession. Not a lodger or a licensee. 

Antoniades v Villiers [1990] 

• Antoniades owned a one bedroom flat in a loft conversion occupied by an unmarried couple- Villiers and Bridger 

• The owner waned them to sign separate but identical agreements, described as a license. 

• Question was asked whether it was a lease or license. 

• Templeman's substance over form was followed 

  • Title is not determinative 

  • The agreements were not separate, they were interdependent and read together. 

• Clause 16 was a pretense- never intended to be used. 

• Looking to the reality: a couple were sharing a small one bed flat as joint tenants with executive possession. 

AG securities v Vaughan [1989] 

• HMO

• Parties moved in at different times

• AG retained the right to introduce a new occupier when someone left. 

• Lease or license? 

  • Court held that they were licensees, not joint tenants 

  • The separate agreements were genuine and reflected the real arrangement between the parties 

  • They were not joint tenants (moved in at different times) 

  • Clause allowed landlord to replace tenants- they did not have executive possession 

Certainty of term

• Leases must be of a certain term- Lace v Chantler [1944] 

• Special rules apply to convert any attempt to create a lease for life into a fixed term of 90 years- LPA s149. However, this is specific and not a general cure for any uncertainty- Mexfield Housing Cooperative Ltd v Berrisford [2011] 

When will a purchaser be bound by the lease?

• Unregistered title- bind whole word, irrespective of notice 

• Registered title: 

  • Less than 7 years- can be overriding interest. Sch 3 para 1 

  • More than 7 years- must have been registered 

Westminster City Council v Clarke [1992] 2 AC 288 

• The City Council (C) owned a hostel for homeless men in which Mr. Clarke (D) occupied a room. 

• C and D entered into an agreement which permitted D to stay at the hostel which was headed ‘Licence to Occupy’ and clearly stated that it is not intended to create rights and obligations of a tenancy. 

• The agreement also stated that the occupier’s accommodation can be changed without notice as the council directs and the occupier can be required to share a room. 

• Following complaints by other residents the C sought to remove D from his accommodation. 

• D argued that the agreement was a lease and that he was entitled to statutory protection from removal as a ‘secure tenant’ under the Housing Act 1985.

• The grant of exclusive possession would be inconsistent with the C’s purpose

• Rights reserved by an owner over the property licensed to an occupier will not be deemed to be pretences intended to hide the appearance of a lease if they serve a genuine purpose. 

Characteristics of a tenancy

1. Exclusive possession 

2. For a certain term 

3. At a rent 

Priority- general rules

LRA (2002) s28(1)- priority as between interests in registered land are determined by the order of creation. 

Exceptions:

LRA 2002 s29(1)- transfer of legal estate for value which is then registered.

Priority- protection of an interest

• Notice is put on register

• Leases of less than 7 years

• Interests of persons in occupation

• Legal easements

Actual occupation cases

Boland- Mrs Boland significantly financially contributed to the property but hadn't registered any legal interest. She had proprietary interests since she contributed to the purchase of the home. She had actual occupation 

McCann- she contributed to the purchase price of a property, but her actual occupation did not exist prior to the creation of the legal charge. She only moved her furniture in 25 minutes before the legal transfer. 

Facchini v Bryson [1952]

Service occupancy- lease was created

Lack of intention to create legal relations

Family- Errington v Errington

Formalities not complied with tends to create an equitable lease

Walsh v Lonsdale and s2 Law of Property- Misc Provisions Act 1989.