CH 4-2: Leasehold Estates

An estate that gives the holder a temporary but exclusive right to possess a property without having title to the property.

Leasehold Estate

This type of leasehold estate is for a fixed time period. It expires at the end unless parites agree to renew.

Estate for Years

This type of leasehold estateis for a fixed, short period of time. Renews automatically unless a party announces termination.

Periodic Estate

This type of leasehold estate is for no particular time period. Either party can terminate.

Estate at Will

This type of leasehold estate is not truly an estate. The tenant remains after lease ends without permission.

Estate at Sufferance

A lessee who remains in possession of property after the lease has expired without permission; a tenant who refuses to surrender possession of property at the tenancy's end.

Holdover Tenant

The owner's interest in a leasehold estate, which is reversionary because possession reverts to the property owner (lessor) when the lease ends.

Leased Fee Estate

A person who leases property; a tenant.

Lessee

A person who leases property to another.

Lessor

Someone in lawful possession of real property, especially someone who has leased property from the owner.

Tenant

A leasehold estate is considered _.

Personal Property

TRUE or FALSE: The lessee is the property owner, while the lessor is the tenant of a leasehold estate.

FALSE: A lessee is the tenant, and the lessor is the owner of a leasehold estate. It might help to remember that the suffix "or" indicates one who gives, and "ee" indicates one who receives. The lessor (owner) grants a leasehold estate to the lessee (tenant).

TRUE or FALSE: With leased fee estates, possession reverts to the property owner when the lease ends.

TRUE: Because the interest is reversionary and temporary, the property owner regains possession when the lease ends.

Donna owns a vacant rental property. Right now, Donna holds a ___ estate. Donna finds a tenant, Jack, to rent the property, and they move in. Now, Donna's interest is a ___ estate. Donna is the .

fee simple / leased fee / lessor

TRUE or FALSE: Pedro has a six-month lease. This is a periodic tenancy, and Pedro can terminate the lease at any time with proper notice.

FALSE: This is an estate for years. This type of leasehold estate can be for any length of time, as long as there is a specific ending date, such as six months from now. This type of lease terminates only at the end of the lease period unless both parties mutually agree otherwise.

TRUE or FALSE: An estate for years can be terminated by the death of one of the parties to the lease.

FALSE: An estate for years is not terminated by the death of either party or by the sale of the property. Only an estate at will is terminated by the death of either party.

Stu is building a new house, which will be finished in three months. Jeff invites Stu to live in the apartment over Jeff's garage for the three months. Jeff will collect $200 in rent from Stu for the next 13 Saturdays. This is an example of a(n):

Estate for years

TRUE or FALSE: Fred notices that a house has been empty for weeks. Fred learns that the property owner Johanna lives in a different state, so they move in, knowing that Johanna will have no idea that they are there. This is an example of a tenancy at sufferance.

FALSE: For there to be a tenancy at sufferance, Fred would have to have first been a legitimate tenant. Fred is nothing more than a trespasser or squatter.

Mark inherited the duplex from his grandmother, Beatrice. Beatrice's will indicates that Mark could keep the property as long as Mark does not build a bar on the land. What type of possessory interest does Mark have in the property?

Freehold estate

Mark's sibling Steve finished college last June and has not been able to find a job. Mark lets Steve live in the other half of Mark's duplex while Steve looks for a permanent job. Steve occasionally gives Mark money for bills from Steve's temporary job delivering pizza. What does this situation represent?

Estate at will

Steve finally lands a job in another state, so Mark is now ready to find a tenant for the duplex. After advertising, Mark finds a nice, quiet computer programmer, Lewis, to rent it. Mark and Lewis sign a 12-month lease. What does this situation represent?

Estate for years

Lewis is a good tenant who always pays rent on time. After Lewis stays on after the lease expires without a new lease and pays the same monthly rent. What does this situation represent?

Periodic estate

A few months pass. Lewis is laid off from the software company. Lewis has no money to pay the rent and no place else to go, so Lewis simply stays put without Mark's permission. What does this situation represent?

Estate at sufferance

Mark has a change of heart and decides that Lewis can stay on for a while, even if Lewis can't pay rent on a regular basis. What does this situation represent now?

Estate at will

Lewis is able to take on some work as a short-term contractor. Lewis now has some income and can pay Mark $500 per month in rent. Knowing the temporary nature of contracting work, Mark agrees to let Lewis remain in the duplex for as long as Lewis is able to pay the monthly rent. What does this situation represent?

Periodic estate