1. Class XX – Leasehold Estates Prof. David Glazier Nov 2, 2006 PropertyProperty

2. Today’s Class The Leasehold Estates - The Term of Years - The Periodic Tenancy - The Tenancy at Will Cases: Garner v. Gerrish - The Tenancy at Will - Leasehold v. Freehold Estate Crechale & Polles v. Smith - Holdover tenants End at 11:40

3. California Bar Exam Subjects Professional Responsibility Real Property Remedies Torts Trusts Wills and Succession Civil Procedure Community Property Constitutional Law Contracts Corporations Criminal Law/Procedure Evidence State specific law tested Also covered by MBE

4. Renting v. Owning Leasehold EstateFreehold Estate

5. The Term of Years Leasehold estate that lasts for fixed period - despite name, may be short or long -- 1 day, 1 month, 1 year, 5 years, etc. - common law had no limits - many states now limit by statute -- Cal limits agricultural land to 51 years -- Cal limits urban land to 99 years Can specify event that will end tenancy - “To T for 25 years or until his death” No termination notice required at lease end

6. The Periodic Tenancy Fixed duration lease continuing until one side gives notice - “To A from month to month” - “To B from year to year” If term not specified, equals rent frequency Common law notice requirement - 6 mos. for year to year - lease period for any shorter lease -- e.g. 1 month for month to month

7. Tenancy at Will Continues as long as parties mutually agree - Either party can terminate as desired - Generally 30 days notice required -- or time equal to rent interval - Also ends at death of either party (PT/TOY don’t) Courts may find a Tenancy at Will if: - oral lease where state SOF requires a writing - lease allows one party to terminate (historically)

8. Garner v. Gerrish (NY 1984) The Facts: Robert Donovan owned house in Potsdam, NY Leased to tenant Lou Gerrish in April 1977 - details filled in on preprinted lease form -- rent set at $100/month -- Gerrish can terminate at date of his choice -- right of reentry if rent not paid 30 days after due Donovan died in November 1981 Executor David Garner served notice to vacate

9. Garner v. Gerrish (NY 1984) The Issue: Does lease giving one party right to terminate still create a tenancy at will? - If so estate ended with Donovan’s death - Executor’s order to vacate valid or Did lease create a “life tenancy” - If so Gerrish can remain for his natural life - Fixed payment of $100/month

10. Garner v. Gerrish (NY 1984) Analysis: The common law - If lessee is at will, lessor must also be -- otherwise would effectively be a life estate -- can’t create a fee w/o livery of seisen Modern law - No reason to be bound by antiquated rules - Intent of contracting parties should govern

11. Garner v. Gerrish (NY 1984) Decision: What did the court decide? What estate did Gerrish have?

12. Crechale & Polles v. Smith (Miss 1974) The Facts: C gave S a five year lease ending Feb 1969 - monthly rent was $1250 S sought month-to-month extension in Dec/Jan C says he said no; S says C said he could stay - C tells S to leave/must pay double rent if holdover S pays rent for Feb-Mar and C cashes check S pays “final” rent (Mar-Apr) but C rejects check - S telegrams that he’s tendering premises

13. Crechale & Polles v. Smith (Miss 1974) The Sad Saga Continued: After S says he’s out, C declares he’s renewed - asserts S liable for new 5-year term A year later C says pay up or vacate S’s attorney then returns key to C!?

14. Crechale & Polles v. Smith (Miss 1974) Holdover Tenants: The Law: Landlord has two common law options: (1) treat as trespasser and evict or (2) hold as tenant for a new term [full duration of original lease if < 1 year, additional year if original lease > 1 year]

15. Crechale & Polles v. Smith (Miss 1974) The Decision: Landlord didn’t exercise either traditional option: (1) Demanding tenant vacate precludes subsequent renewal of lease but (2) Accepting rent and failing to eject creates right of tenant to remain so landlord here creates month-to-month tenancy - S owes rent for actual occupancy and damages

16. Holdover Tenants: Takeaways Common law: Landlord’s option: evict or hold to new term State statutes: May limit holdover term (e.g., month to month) May provide double rent (e.g., Miss.) Typically address “self-help” Customary Exceptions: Circumstances beyond tenant’s control Ongoing negotiations De minimis holdover

17. Looking Ahead Next Class – Tue 11/07 pp. 373-87 The Lease - Skim pp. 373-376 *** Discrimination Law - Skim pp. 376-383 *** Delivery of Possession - Read pp. 384-387 - Hannan v. Dusch pp. 384-87 - Notes 1-3 on pp. 387 -- English v. American rules-your thoughts?? Office hours today: 2:00-3:30

18. Questions?