(17) Leasehold Estates

What is a leasehold estate?

A nonfreehold estate in land that gives the tenant exclusive possession while the landlord retains a reversion.

What interest does a landlord retain after conveying a leasehold?

A reversionary interest in the property.

Does a tenant hold seisin of leased property?

No. The tenant has possession, while the landlord retains seisin.

What is the common law view of lease covenants?

Lease covenants are independent; a landlord's breach generally does not excuse the tenant's obligation to pay rent.

What is the modern view of lease covenants?

Leases are treated more like contracts, and a landlord's breach may excuse the tenant's future performance because the covenants are treated as dependent.

What are the four leasehold estates?

Tenancy for years, periodic tenancy, tenancy at will, and tenancy at sufferance.

What is a tenancy for years?

A leasehold with a fixed beginning and fixed ending date that automatically terminates at the end of the stated term.

What is the defining characteristic of a tenancy for years?

The parties know exactly when the tenancy will end.

How is a tenancy for years typically created?

By a written lease.

Does a tenancy for years require notice to terminate?

No. It expires automatically at the end of the stated term.

What is the common law Statute of Frauds rule for leases?

Leases longer than three years must be in writing.

What is the modern Statute of Frauds rule for leases?

Leases longer than one year generally must be in writing.

What happens when an oral lease violates the Statute of Frauds?

Entry onto the property creates a tenancy at will.

What happens if rent is paid under an invalid oral lease?

The tenancy at will becomes a periodic tenancy based on the rent payment schedule.

What is surrender of a lease?

The tenant voluntarily gives up the leasehold before expiration and the landlord accepts it.

What is a periodic tenancy?

A leasehold that automatically renews for successive periods until properly terminated by notice.

What distinguishes a periodic tenancy from a tenancy for years?

The beginning date is certain, but the ending date is uncertain until proper notice is given.

How can a periodic tenancy be created?

By express agreement, by implication from periodic rent payments, or by operation of law.

What is a holdover tenant?

A tenant who remains in possession after the lease has expired.

What was a holdover tenant considered at common law?

A tenant at sufferance.

What options does a landlord have when a tenant holds over under the modern rule?

The landlord may treat the tenant as either a trespasser or a periodic tenant under the terms of the prior lease.

What tenancy results when a tenant enters under an invalid lease?

A tenancy at will.

What converts a tenancy at will into a periodic tenancy?

Payment of rent at regular intervals.

How is a periodic tenancy terminated?

By proper notice from either party.

What was the common law notice requirement for terminating a periodic tenancy?

Notice equal to the rental period, but never more than six months.

What is the modern notice requirement for terminating a periodic tenancy?

Generally thirty days' notice, unless modified by statute.

What is a tenancy at will?

A leasehold that may be terminated at any time by either the landlord or the tenant.

What is required for a valid tenancy at will?

It must be terminable by both parties.

What happens if only the landlord has the right to terminate a tenancy at will?

The same right will generally be implied in favor of the tenant.

How is a tenancy at will created?

By express agreement or by operation of law, such as an invalid lease.

Did the common law require notice to terminate a tenancy at will?

No.

What is the modern trend regarding termination of a tenancy at will?

Many jurisdictions require written notice before termination.

What is California's notice period for terminating a tenancy at will according to the outline?

Thirty days.

Besides notice, how else may a tenancy at will terminate?

By operation of law, such as death or termination of the landlord's reversion.

What is a tenancy at sufferance?

A tenancy created when a tenant lawfully enters possession but wrongfully remains after the tenancy ends.

How long does a tenancy at sufferance last?

Until the landlord takes action to evict or otherwise resolve the tenancy.

How can a tenancy at sufferance be transformed into another tenancy?

By the landlord's express or implied consent.

Into what types of tenancy may a tenancy at sufferance be converted?

A tenancy at will or a periodic tenancy.

What remedies does a landlord have against a tenant at sufferance?

Evict the tenant, consent to continued occupancy, or recover the reasonable rental value under quasi-contract.

Is notice required to terminate a tenancy at sufferance?

No.

Testable Issue: What are the four leasehold estates?

Tenancy for years, periodic tenancy, tenancy at will, and tenancy at sufferance.

Testable Issue: What happens when an oral lease violates the Statute of Frauds and the tenant takes possession?

The tenancy becomes a tenancy at will, and payment of periodic rent converts it into a periodic tenancy.

Testable Issue: What distinguishes a tenancy for years from a periodic tenancy?

A tenancy for years ends automatically on a fixed date, while a periodic tenancy continues until proper notice is given.

Testable Issue: What rights does a landlord have when a tenant holds over after the lease expires?

The landlord may treat the tenant as a trespasser or, under the modern rule, create a new periodic tenancy under the prior lease terms.

Testable Issue: When may a tenancy at sufferance become a periodic tenancy?

When the landlord consents, expressly or impliedly, to the tenant's continued possession.

Essay Rule: How should you analyze a leasehold estate?

Identify the type of tenancy, determine how it was created, apply any Statute of Frauds issues, determine the applicable notice requirements, and analyze how and when the tenancy terminates.

Master Synthesis: What is the framework for analyzing leasehold estates?

Determine whether the tenancy is for years, periodic, at will, or at sufferance; analyze creation, Statute of Frauds issues, termination requirements, and any holdover or consent issues to determine the parties' rights and obligations.