LEASES I:. Landlord and tenant.—A landlord is an owner of an estate in real property, or of an interest therein, when considered with relation to another hiring the property and agreeing to pay rent, who is known as the "tenant." 2. Definition of rent.—Rent is a definite periodi cal return for the use of land. The expression "definite" does not mean necessarily that which is ascertained by the agreement itself, but that which can be made definite. If the return from a farm is to be a share of the produce, while neither party knows in advance what that share will be worth, the fact that the share can be ascertained when the return is to be made, make it a definite return. Hence "leas ing on shares" establishes the relation of landlord and tenant.
The return must be periodical as well as definite. A period must be specified when the return is payable. Sometimes it is all payable at one time, as at the beginning or the end of the term. Very often the rent is paid in instalments, either monthly, quarterly, or yearly.
3. Term of lease.—The time during which occu panty is to last is known as the term of the lease, or technically as "the term." There_is no limit as to what the term may be. It may be one day, one month, one year, or 999 years.
In New York State long-term leases usually are made for twenty-one years with the privilege of one or more renewals for similar terms. The reason for this is that the rent on leases for more than twenty one years is taxable as personal property to the per son entitled to receive it. If the person is not within the state, it may be taxed against the tenant. This tax is an added burden since it is imposed in addition to the ordinary tax upon the land, and to avoid it the expedient of the shorter term with renewal privilege has been adopted.
4. Assignment of landlord's interest in the rent, his right to receive rent, and his expecta tion of being restored to possession of the property at the expiration of the term, remains real property. A deed to the property carries with it the right to receive the rent. The tenant's interest, regardless bf the length of the lease is personal property, is assign able as personal property and goes to the personal representative rather than to the heirs. Unless the lease expressly provides against it the tenant's rights may be assigned or mortgaged. Any such
mortgage would be a lien on the tenant's term or right of occupancy. If a lease provides that it shall not be assigned by the tenant, as leases usually do, and if notwithstanding the covenant, the tenant assigns the lease, and the landlord knowing of the assignment accepts rent from the assignee, that pro vision of the lease will be deemed to have been waived. Thereafter the lease is freely assignable. To guard against this possibility, the lease should provide not only that the tenant shall not assign but also that no subsequerit assignee shall assign.
An assignment of a lease does not relieve the tenant of liability to pay the rent he has agreed to pay. He is bound on his covenant to pay rent, but is entitled to be credited with any amount collected by the land lord from the assignee. Any occupant other than the original tenant can be held liable for the payment of a fair rental and can be sued for the value of the occupancy during his actual use. He cannot be held for the rent called for by the lease unless an agree ment to pay that rent can be shown.
5. Leases created orally and by writing.—A lease for the term of one year or less may be created orally. A lease for a term exceeding one year must be in writing and must be signed by the person to be charged. These terms may vary in different states. In New Jersey, for instance, a lease must be for a ten-year-term period, in order to be recorded, and leases may be made orally for any term up to five years. The statute law of the individual states should be consulted when exact information is re quired. The element of signing and the necessity for expressing clearly the entire contract in the in strument are the same as in the other instruments we have considered. Some leases may be recorded (in New York those for three years or longer) but they usually are binding upon the parties even tho not recorded. It should be noted that actual notice by occupancy applies to leaseholds as well as to other interests in the land. Possession of the property gives to those dealing with the property actual notice of the tenant's rights. It is not safe to conclude that if a tenant has not recorded his lease the term of it is only a short one.