CASE STUDY

Case Study



Case Study

The essence of this case is whether David's occupation is under a lease or just under a licence. The distinction between a lease and a licence is important because David will enjoy the security of tenure legislation found in the Land and Tenant (Consolidation) Ordinance (LTCO), while he does not if he occupies the studio under a licence. David will qualify as a lessee if his occupation displays the certain characteristics: Exclusion Possession and Fixed Duration.

Exclusive Possession

In order for occupation to qualify as a lease, David must be given exclusive possession of the studio. It is exclusive possession that justifies the recognition of David's occupation as an estate or interest in the land itself. It marks the degree of physical control over the land that entitles David to call the land his own and to keep out anyone he does not wish to enter, including Carol. If exclusive possession is not given, David will only enjoy a licence to occupy, which confers no estate or interest in the land.

In this case, David is given exclusive possession because he is given the right to occupy the studio for one year. Although David and Carol sign an agreement described as a licence, they cannot create a licence simply by calling the agreement a licence. Carol must ensure that no exclusive possession is granted to David. Street v Mountford (1985)AC 809

Moreover, the terms of the agreement also confirm David's control of the studio. As the right to enter and view the premise is granted to Carol, it again supports the grant of exclusion possession to David. If no grant of exclusive possession is made, there will be no need for Carol to reserve a right to enter and inspect.

However, we cannot say that David is a lodger because no terms in the agreement give Carol the right to interfere with David's right to use the studio or restricting David's or his visitors' access to the studio at certain times of the day. Moreover, David has an individual key to the studio. The studio is furnished and he has to clean the studio by himself because no Amahs service is provided. Thus, David is given exclusive possession. May King Development Co v Young Ching-huo Ltd. (1981) HKLR 280

Fixed Duration

A lease grants a right to exclusive possession for a defined or certain period of time. That period may vary from the very short to the very long.

Commencement Date

The commencement date of the lease must be ascertainable Harvey v Pratt (1965) 2 All ER 786. It is usual to state the commencement date, but if it is not stated, just like this case, it must be possible to infer a date from the terms of the parties' agreement, in this case the date of taking up possession by David.

Certainty of Duration

The duration or term of the ease must be ascertainable at the commencement of the lease. In this case, a granted occupation for a period of one year confirms the certainty of ...