Andrew
Legal Matters with Arthur Marara
THERE are two essentials of a contract of lease.
We highlighted this in the earlier article, that is, an undertaking by the lessor (the person who grants a lease) to give the lessee (the person who holds the lease) temporary use and enjoyment of a thing; and an undertaking by the lessee to pay a sum of money in return for the use and enjoyment he or she will receive (for example, an undertaking to pay rent).
What do the above elements mean? This article will discuss the essentials in detail.
The lessor does not necessarily have to be the owner of the property or thing.
This means a person who is leasing a property from another person can lawfully sublease the property to another person if there is no specific prohibition against subleasing.
A lessee cannot, therefore, attack the lease agreement on the basis of the lessor’s lack of title if the latter has delivered and continues to deliver the use and enjoyment of the property.
This means a subtenant can lawfully be evicted for breach of terms of a sublease.
In Sby G.M.CO v Klipriviersberg Estate & G.M. Co 1893, Kotze CJ commented on this principle as follows:
“By the law of this country, any person can let to another something which belongs to a third party, and it is not open to the lessee to raise the defence that he has discovered that the lessor had no right to enter into a contract of lease with him, or that the property leased belongs to another person, where, for instance, he is, during the currency of the lease, sued for the payment of the stipulated rent.”
This approach was adopted in a later case, Clarke v Nourse Mines Ltd 1901 TS 512 at 520-521, where Solomon J held that one must pay for what one has contracted for and received, and that it is against good faith to attempt to use the law to avoid payment in such circumstances.
Thus, while the lessor does not need to be the owner of the thing let, he or she must guarantee that the lessee will have undisturbed use and enjoyment of the property.
If the lessor fails to do so, he or she may be in breach of contract and may be liable for damages. Lease agreements have to be crafted neatly to address the issue of subletting and the consequences of such.
In many instances, lessees usually sublet and use the proceeds from the subtenants to settle their rent and, in other instances, even make a profit from the premises.
Temporary
One of the key terms in a lease is “temporary”. This means the focus of the lease is on the “temporal” use and enjoyment of a thing.
Parties are, however, free to enter into agreements that grant the use and enjoyment of a thing to another in perpetuity.
While this agreement is not invalid, it will not be a contract of lease. This requirement is fulfilled if the lease agreement is entered into for an indefinite period or until the occurrence of an event that is bound to happen, although the time for its occurrence is unknown. You, thus, need to be clear about what you are entering yourself into.
Use and enjoyment
The contract of lease must confer on the lessee power to use and enjoy the thing that is let.
This, however, does not mean the lessor cannot grant partial use and enjoyment of a thing. This usually happens when the lessor rents out one room of his or her house, or when the lessee lets the surface of one wall for advertising. You may have seen many adverts like these in many urban areas.
The right of use and enjoyment of a thing consists of the right to use the property (lus utendi) and the right to collect and use up its fruits (lus fruendi).
The lus utendi and the lus fruendi are only two incidents of the bundle of rights an owner has in relation to the property he or she owns.
Where a lessor grants power on the lessee other than that of use and enjoyment, for example, the power to diminish, consume or alienate the thing, the contract cannot be classified as a lease.
◆ To be continued . . .
LEGAL DISCLAIMER: The material contained in this article is set out in good faith for general guidance in the spirit of raising legal awareness on topical interests that affect most people on a daily basis. Laws and regulations are complex and liable to change, and readers should check the current position with the relevant authorities before making personal arrangements. For legal advice, you should consult with an attorney concerning your specific situation.
◆ Arthur Marara is a corporate law attorney. WhatsApp him on +263780055152 or email [email protected]
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