6. Monthly shortest lease known commercially and to the law is the tenancy from month to month. This is an agreement, oral or written, whereby the tenant hires and the landlord lets the premises for a period of one month only. A term of leasing from week to week comes under this same classification. While the tenancy apparently terminates at the end of the month, it is actually a self-renewing month-to-month arrangement. The tenant usually remains in possession and the landlord receives the rent month after month.
It is a uniform rule, except in New York State, that a notice to quit shall be coincident with the length of the tenancy period. So a tenant from month to month must be given one month's notice, a tenant from week to week, one week's notice ending with the tenant's week, and so on. In New York City, by statute, only five days' notice is required. The requirement of notice to end leases of this kind is reciprocal. This is the common law rule, but an apparent exception exists in New York State, where a dictum of the court implies that the tenant need not give notice. If the tenant stays over his monthly term for even one day he is liable for another month's rent.
7. tenancy-at-will is the longest term of letting in the eyes of the law. The term is indefinite—there is no limit to its duration. The usual arrangement is that a letting is agreed upon, with rent payable monthly, but no term is stated. The tenancy-at-will is apt to be confused with a monthly tenancy. If the parties desire a monthly tenancy it should be so provided in the written agree ment if there be one, or the rent receipt should read to that effect.
A tenancy-at-will can be terminated by either party at will. In New York City, by statute, all tenancies at-will end on May 1 of each year and the tenant can remove or the landlord require possession without notice.
8. Tenancy for years.—A tenancy other than that from month to month, or at will, is usually for a year or more. The term is fixed definitely by agreement. Such a tenancy ends of its own force, without notice, on the last day of the term. If the tenant continues in possession at the end of the term, the landlord may exercise one of three options. He may dispossess the tenant and obtain possession; he may consider the tenant a hold-over from month to month, or he may consider the tenant a hold-over for a further period of one year. If nothing be said on either side, the presumption is that of the hold-over on an annual basis and upon the same terms as the former lease.
9. Ground lease.—There is a form of lease for years which is sometimes called a ground lease. The feature of this form of lease is that it is a lease of the ground only, the tenant erecting the structure on the land. The term of the lease must, of necessity, be long, in order to induce the tenant to erect a suit able building. There may be one long term, or there may be a term of say twenty-one years with a privi lege of one or more renewals for like terms.
The rent fixed by a ground lease is often based on a percentage of the value of the land. In case of renewal privileges, it may be provided that the rent for the renewed term be made a certain percentage of the value of the land at the time the new term commences. The new value is arrived at frequently by arbitration. Usually all taxes, assessments and water rates must be paid by the tenant, so that the return to the landlord is net.
The problem of the tenant is to put a building on the plot and obtain such rents from sub-tenants oc cupying it as will pay the following charges: (a) The ground rent.
(b) Taxes and water rates (and assessments if any).
(c) Fire insurance, labor, heat, light and power, repairs, and all expenses incidental to the upkeep and maintenance of the building.
(d) Interest on the amount invested in erecting the building.
(e) An amount sufficient to amortize the cost of the building by the end of the term of the lease, or the end of the last renewal of the lease.
(f ) A sum over and above all the foregoing charges to compensate him for his own services and the risk he assumes in undertaking the enterprise.
In some cases it is provided in the lease that at its expiration the landlord shall pay the tenant a fixed sum for the buildings erected. In this case the ten ant would only have to amortize the difference between the cost of the building and the sum to be received from the landlord on the surrender of the premises. It should be remembered that the buildings are real estate and belong to the landlord as owner of the fee as soon as erected, but nevertheless the landlord can agree to pay the tenant for them on the expiration of the lease. The maxim is "He who owns the soil owns from the center of the earth to the sky," but but there are many qualifications of this.