Determination of a Lease, Forfeiture and Relief

In one line

A lease ends in one of eight ways, forfeiture can be waived or relieved against, a tenant who stays on with the landlord's assent gets a new tenancy, and none of this applies to agricultural leases unless the State says so.

In exam wording: section 111 provides that a lease of immovable property determines by efflux of time; by the happening of an event on which the time was conditionally limited; by the happening of an event on which the lessor's interest terminates; by merger; by express surrender; by implied surrender; by forfeiture; and on the expiration of a notice to quit.

Section 111: the eight modes

(a) Efflux of the time limited. The commonest, and it needs no notice: the term simply runs out.

(b) The happening of an event on which the time was conditionally limited. Where the lease was to last until something happened, it ends when it happens.

(c) Termination of the lessor's interest. Where the lessor's own interest in the property terminates, or his power to dispose of it extends only to the happening of an event, the lease ends on that event. A lessor cannot grant more than he has.

(d) Merger. Where the interests of the lessee and the lessor in the whole of the property become vested at the same time in one person in the same right. The tenant buys the freehold, and the lease is swallowed by the ownership.

(e) Express surrender. The lessee yields up his interest to the lessor by mutual agreement.

(f) Implied surrender. Surrender inferred from conduct. The Act's illustration: a lessee accepts from his lessor a new lease of the property, to take effect during the continuance of the existing lease. That is an implied surrender of the former lease, which determines thereupon.

(g) Forfeiture. In three cases:

1. the lessee breaks an express condition providing that on breach the lessor may re-enter;
2. the lessee renounces his character as lessee by setting up a title in a third person or claiming title in himself; or
3. the lessee is adjudicated an insolvent and the lease provides that the lessor may re-enter on that event;

and in any of these cases the lessor or his transferee gives notice in writing to the lessee of his intention to determine the lease.

Those last words are essential and are the commonest omission in an answer. Forfeiture is not automatic. The breach gives a right; the lease ends only when the lessor elects and gives written notice of his intention.

(h) Expiry of a notice to quit, duly given by one party to the other, under section 106.