Lease V Licence V Easement PDF

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Compare and Contrast Summary of Land Law...

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LEASE V LICENCE V EASEMENT Lease Property Interest and contractual interest (Legal or Equitable)

Licence Contractual Interest (Purely equitable) NOT a property interest

Easement Property Interest and a contractual interest (Legal or Equitable)

Covenant A legal word for a formal promise (Equitable Interest)-NonPossessory/Not a property interest Contractual

Example

Renting something like a flat or a car

An ability to do something? Like a drivers license etc

Ceda: Pay fees into an association for the upkeep of the mall

Definition?

A property interest but also a contract in which a party conveys land, a house etc

A permit to do something or carry on a trade etc

Drainage easements, pipelines, cable easements owned by water etc. A right of way to do something on someone else’s land-short of posession.

What is it?

Easement Appurtenant: Attaches to a particular piece of land (dominant tenement) and it runs with both the dominant and the servient tenement. Easement is owned by another plot of land Easement in Gross per s291 Not attached to a dominant tenement but rather is personal to the grantees (owned by a person)

Covenants have to do with your land Positive Covenant: Do something that would beneficially affect the value of someone else’s land Restrictive Covenant: Obey by doing nothing. Don’t do anything that will cause detriment to someone elses land (neighbour?)

How can they be created?/Enforceable

Writing (Disposition per s24?) or Oral + Part performance

By a contract

Legal easement: Easement certificate (s90A LTA) OR Pursuant to a memorandum of transfer which has been executed by grantor and grantee, s90, Land Transfer Act (formally)

Through a contract or an agreement They are a part of a lease deed so additional terms and conditions are transferred with the property

Equitable easement: Can be created informally Requirements to have an..//Characteristics

-Fixed term/periodic term (Smallwood v Sheppards) -Exclusive posession (Fatac) -Rent (Street v Mountford in Fatac). Rent does help indicate intent -Intent- (Fatac: Objective) -consideration -Language and Style (NZ Fish & Game held that they might be factors)

Anything short of a lease is a licence.

Requirements: -Expressly (Not by prescription) -Must be positive (Conferring a right on the servient tenement except of those of negative easementsthere are both positive and negative easements, however negative easements are strict) -Must not substantially deprive the servient owner from legal possession

Agree to one/sign a contract

Does it have exclusive posession?

Exclusive posession

Don’t have exclusive posession

Don’t have exclusive posession (Lord

Not relevant but can caveat a covenant

Can it sue Trespassers?

Can sue trespassers

The different types available

-Legal Lease (capable of being registrated/deed) -Equitable lease -Equitable contract to lease (Agreement for a lease is regarded as a lease as held in Walsh v Lonsdale) -Short term lease (legal interest but cannot be registered) Yes If legal but not if equitable

Does it remain if the land gets sold?/Gets passed on?

Can it be defeated?

An equitable lease can be defeated by a legal lease. (Legal lease >equitable lease however you can protect an equitable lease by caveating)

Can’t sue trespassers (Exceptions apply) Equitable licence?

No

Yes-by anything essentially (cannot be protected by priority rules or caveat)

S v Ouster Principle) Can’t sue trespassers

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Legal Easement Equitable Easement

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Yes, essentially forever (because of the land) (Pipes under the ground??) An equitable easement can be defeated by a legal easement

Positive and Restrictive covenant can if there has been notice per s303. Can be forced into it by an injunction of specific performance

Characteristics of an Easement + Exclusive Posession Clos Farming Estate makes the last characteristic of Re EllenBorough park more intelligible by saying that an easement must be capable of being an easement by -Rights purported cannot be expressed in terms too wide or vague -Easements need to require a quality of utility (The utility of the easement is…) not just mere rights of recreation -Whether such rights would substantially deprive the park owners of legal posession In regards to the last characteristic: There is no NZ Case Law Two Approaches: Australian line of cases; Ouster Principle (Lord Neuberger in Moncrieff) English Line of cases; Moncrieff v Jamieson (Lord Scott)

Towers argues that the two tests might be cumulative. Towers focuses on functionality Ouster Principle: Clos Farming: An easement must not amount to joint occupation or deprive owners of possession Reilly v Booth: Describes the Ouster principle as a principle of proportionality. There must not be an easement which gives exclusive and unrestricted use of a piece of land London & Blenheim Estates: Must not leave the servient owner without any reasonable use of his land Lord Neuberger in Moncrieff v Jamieson takes the ouster principle approach. Essentially even if you have exclusive control over a small piece of land and its only a small area of the land, its still an easement. Look at part of the land subject to the easement itself in relation to the whole servient tenement and whether the servient owner is left with reasonable use of the land Lord Scott in Moncrief v Jamieson: Believes the ouster principle is wrong. Looks at use rather than posession If you have exclusive control it is not an easement Only focuses on part of the land subject to the easement Dislikes the qualitative nature of the ouster principle Wright v McAdam; Issue: Locked shed case; Held that an easement to store coal in a shed on the servient tenement was valid. If the shed was locked and was used exclusively, posession could then be demonstrated. More Joint occupation/substantial deprivation cases: East Freemantle: The right to park cars does not extend to confer exclusive and unrestricted use of the land in question Cites Copland: The matter must be one of degree. A coal shed in a large property is one thing and the exclusive use of a large part of the alleged servient tenement is another. Satisfied Lord Scotts test in Moncrief and Reasonable use test in London & Blenheim estates in which an easement for car parking is ‘transitory in nature’. Parking is transitory in nature, does not deprive the owner of posession (lord Scott) and the servient tenement still has reasonable use of their land Jea Holding: Held to be a valid easement as the servient owner could still use the parks and it was a reasonable use of the land Clos Farming: Held not an easement as the owners of dominant land controlled the whole land and there was no use for the servient owner. Towers v Stolyer: About parking space Decided that although the easement meant that the ability of the servient owner to use the space was significantly reduced, they could still make use of those areas to an extent that it didn't unreasonable interfere with the dominant owner's rights, which meant that it was an easement

CURRENTLY IN NZ: Australia: Ouster principle is orthodox principle England: Used to be ouster principle but Moncrieff has shaken it No definitive authority in NZ but its likely the courts will follow the orthodox approach. Lease v License: Fundamental difference is exclusive posession (Fatac) Things to take into account about whether the parties intended to have exclusive posession?: Parties intention: Intention of parties is the main difference (intention of that of substantive rights) How did the parties intend to express exclusive posession (substantively), Control? Consent? Locked? Sign? Obligations? Logical form? Labels? Rent? (more on last 3 below) Landlord requiring tenants consent to do something on that land which then signifies tenant control over land and exclusive posession (NZ Fish & Game) Factors: Rent? Rent is an important indicator of a lease but its absence does not negate tenancy (Street v Mountford) Labels? Unaffected by the label the parties choose to put (Street v Mountford) Logical form? Lease is a grant of exclusive posession subtracted by restrictions WHILE a license is nothing while adding things (Simon France; NZ Fish and Game) While in Fish and Game there were extensive restrictions in the contract, restrictions are not inconsistent with having posession (Minority in Wik) A lease could be granted for a limited purpose like in a pastoral lease (Minority in Wik found that pastoral leases were leases that gave exclusive posession). The extensive obligation would also be consistent with having a lease. Restrictions are not inconsistent with posession License (Contractual license) v Easement (Equitable easement): Olo Ltd: Look at the parties intention If elements that are essential to the existence of an easement are not present (such as consideration), then it can only be a licence.  Unless there are strong indications that the right was intended to be personal to the grantee (licence/contract) then it is probably to be construed as an equitable easement. Citing McDonald v Peddle: Factors for parties intentions References to ‘his..’ or ‘the grantee’ is not indicative that the right is intended to be personal Adding successors in the title might indicate that its an easement but failing to do so is not fatal in indicating it’s a license. Failing to include successors in title does not mean the parties intended to create a licence rather than an easement The use of the word ‘License’ in conveyancing is indicative of it being a licence EVEN if there were successors in the contract (successors in the contract means its an easement?) –IDC Group

Can a Licensee sue in Trespass: Two approaches Orthodox approach

Manchestor v Dutton; English cases ORTHODOX APPROACH: The orthodox approach is that only those who have exclusive posession (lease) can sue in trespass Hill v Tupper: Licensee means you cannot sue for trespass Sealink: Reaffirmed orthodoxy but have expressed doubt in regards to traditional approach. Sealink had expressly reserved the right to sue trespassers so licensee didn’t have a right to that superior of trespassers Georgeski: Reaffirmed orthodoxy but have expressed doubt in regards to traditional approach + suggests posession in fact might be sufficient for trespass MANCHESTOR V DUTTON: Allow trespass cause of action for licensee if its necessary to vindicate and give rights to occupation. Majority in the case: Licensee’s favour; licensee has a right superior to that of a bare trespasser Has not be subsequently overruled but has been accepted in the CoA cases Mayor of London v Hall Countryside residential v T Vehicle Control Services v Cmsrs for Revenue Will allow trespass as long as licensee have occupation National Provincial Bank v Ainsworth: Occupier can sue trespasser, if it is necessary to vindicate and give effect to the right of occupation granted by the license. Obiter: Exclusive posession could be viewed as a relative concept (between two parties) like in chattel law CoA or SC in NZ would have to adopt this approach and a more liberal judge too. Practical need for this approach as it allows the licensee to protect their interest against a mere trespasser. Furthermore, this approach would be consistent with current tread of increasing protection of licensee as in s206 (3) PLA extending relief against cancellation for occupation licensees. How to cancel a lease? Ending a lease due to breach 1. A landlord will always be able to cancel a lease Express provision consistent with the Act (s243) OR Implied by Clause 12 which has to be in accordance with s244: Can cancel a lease for failure to pay rent or breach of covenant (for 15 working days without notice) OR s245 or s246 in accordance with s243 which has to be in accordance with s244 (10 working days with notice; formal notice must be given specifying the breach and give the tenant stipulated time to remedy the breach and must say what compensation the landlord thinks might be reasonable) 2. Landlord must follow procedural code in order to cancel a lease s243; s244-264 Lessor may apply for order of posession of the land or re enter peaceably if the lessor wishes to exercise a right to cancel a lease because of a breach by the lessee of a covenant or condition; s244 3. The tenant may go to court and ask for relief against cancellation for breach of covenant or condition: s253

Discretion is wide, although statutory, is treated equitable Cancellation Cases: Mulholland v Waimarie Industries: • There is a presumptive relief on payment given the arrears and costs are paid • If tenant is hopelessly insolvent and unable to pay rent, court will not grant relief as a general rule • Mere suspicion of insolvency will not be enough to outweigh the presumptive right to relief on payment of rental and costs Strong Hurunui Hotel: Used the proportionality test in Studio X in considering the application for relief against cancellation Breach deliberate, important and persistent BUT there would be a big loss to the tenant and could be remedied quickly without lasting damages and thus conditional relief granted Factors: Breach deliberate? Beyond D control? Conduct of Landlord? Willingness of tenant to make good of breach? Personal qualifications of tenants? Gravity of breach? Lasting damage caused to landlord? Stylo Medical Services: Even though tenant got behind on their rent and paid it by the time the court proceedings cam about, the Judge warned them it would be the last time, and they did it again and there was still relief against forfeiture. The fact you are a bad payer is not enough Sibrad Company: Number of breached of the lease and tenant has not been good. Thus the landlord would be prejudiced if relief is granted. Tenant could find another land, Landlord shouldn’t have to live next to a bad tenant (breach; nuisance, disturbance or damage to landlord and neighbours land and using land in a noxious or offensive matter) Cites Gill v Lewis: Application against forfeiture (cancellation) arising from failure to renew is different than application for relief when there has been failure to pay rent...