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Flat Living WeBSiteGuide Understanding your lease LeASe mAnAGe YourBLoCK SerViCe


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What is a lease? Sterling Estates explainsthecomplexitiesof theleasehold system


AleAse in itssimplecontext is a contract betweentwo parties. In such acontract, an interest


of land or property is being createdorgiven by theland owner (commonly referred to as the landlord), to the tenant (commonly referred to as the lessee). In such a contract, land or property has been demised to thelesseefor aperiodoftime. Whensuchaninterest in land or property is beinggranted,there is oftenconsideration,(that’s money tomeand you), passing fromthelesseetothe landlord. Such considerationmay be a one-off premiumpaymentbeing made at the start of the lease or a yearly premium, (rent), being paid over thetermofthe lease. In someinstances theremay be a combination of both; a one-off premiumand a yearly rent being paid to thelandlord. The creation of this contract


–the lease–gives rise tomany rights, often bestowed on the lesseewhich, withoutthis lease, the lessee would not have. Obligations both positive andnegativebetween thetwo parties involved are recorded in this leasecontract. Should one party fail to comply with such obligations this would give rise to a breach of lease, whichisessentially abreachofa contractualobligation,resulting in someone probably being sued. Or at least that was and is the theory. The contract, or lease, attempts to strike apositionof equality betweenbothlandlord


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and lessee, but does it? By looking at both the


evolution of common lawand statutewhich governsthe relationship between landlord andlessee, it is clearthatthe ‘powers that be’ have attempted to bring somecertainty and proper equality betweenthe parties. Onemust remember, historically this contractual relationship betweenlandowner and tenant often was not in writtenform. Therewas a timein Englishlawwhere contracts forthe sale of land or an interest in land were enforceablebyoralagreements


properties and or relationships betweenthe landlord andlessee. Ishall notbeattemptingto either describe thenumerous types of leases and the difference betweenacommerciallease and a residential lease for the purpose of this article. Thefactis, that this is an ongoing debatewhich theJudiciary constantly deals with,and is atopicoflegal debate depending onwhat right you are trying to enforce at the time, or thepositionyou wanttoadopt for personal gain and/ or benefit. In generalterms,there are


leaseswhichare commercial in naturewhichattempt to


that thereisnosuchthingas a standard lease


as well as writtenones. You can imagine the disputes that theseoralcontracts would have given rise to. Legislation wasbrought aboutwhich then sought to crystallisethe position;making itmandatory fortransactionsinvolving the sale of land/propertyand or dispositionofthe sameto be in awritten agreement. Reference can bemade to both the Law of Property Act1925and The LawofProperty(Miscellaneous Provisions) Act 1989. Therearemany typesofleases which relate tomany types of


regulate thebusinessrelationship betweenthe landlord andlessee andthere areleaseswhichare residentialinnature(in that the leaserelates to aflat or house), whichattempt to regulate therelationshipbetween a landlord,whoviews hisinterest in thepropertypurelyfrom a commercial basisand alessee, whoviews theirinterest in the demisedpropertyasahome. The residentiallessees position has theoreticallychanged in recent years, forexample thelesseemay nowbeone of theselandlordsin hisownright,whohas acquired


thefirst thingto realise...is


thelease property forthe purpose of rentingthe sameoutfor short periodsoftimeand earninga rental income.Whether the leasepropertyisresidential or commercial in nature,there is bothamplecommonlawand statutetoprovide guidance and regulationsregarding theconduct of both thelandlord andlessee. For the purpose of the rest


of this articleIshall discussin broad termswhat you the reader should consider and reflect on when dealing with a leasewhich relates to a residential property such as aflat or house.Weshall discusswhattheyare,andwhy they are needed. Finally, we’ll look at the importance of being familiar with your leaseand someof the things to look out for. Thefirst thingtorealisewhen


dealing with leases,isthatthere is no such thingasastandard lease. Theremay well be standard prescribed covenants, obligations and clauseswhich


Findoutmore


Go to http://www.flat-living. co.uk/advice/18-lease


This area of thewebsite is splitintoanumberof useful sections: nAbout your lease nExtending your lease nBuying your freehold nAbout Right to Manage


Issue 15 Flat Living


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