© 2015 oncourse learning chapter 13 leasehold estates
TRANSCRIPT
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© 2015 OnCourse Learning
Chapter 13Leasehold Estates
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IN THIS CHAPTER
• Landlord–tenant law. • Defines and explains the parties in
a lease.• The essential elements of lease.• Duties, obligations, and rights of
the parties to the lease agreement.
• Leaseholds.
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LANDLORD–TENANT RELATIONSHIP
• A lease is a contract between the owner of the property and the tenant.
• The owner transfers to the tenant a property interest of possession for a prescribed period of time.
• The owner is the landlord or lessor. • The tenant is the lessee.• Possession of the property will go
back to the owner at end of lease.
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LEASE ELEMENTS
• Property Description• Term• Rent• Written or Oral Provisions• Recordation
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Michigan Truth in Renting Act
• Regulates rental agreements for residential properties.
• Prevent landlords from using leases to violate tenants’ rights.
• Tenants cannot waive rights.• Excludes certain provisions from
being in rental agreement.
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Required Notice NOTICE: MICHIGAN LAW ESTABLISHES
RIGHTS AND OBLIGATIONS FOR PARTIES TO RENTAL AGREEMENTS. THIS AGREEMENT IS REQUIRED TO COMPLY WITH THE TRUTH IN RENTING ACT. IF YOU HAVE A QUESTION ABOUT THE INTERPRETATION OR LEGALITY OF A PROVISION OF THE AGREEMENT, YOU MAY WANT TO SEEK ASSISTANCE FROM A LAWYER OR OTHER QUALIFIED PERSON.
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Mutual Obligations
• The tenant’s consideration is rent. • The landlord’s consideration is possession
of the premises and the right of quiet enjoyment.
• The landlord’s obligation to give possession of the premises to the tenant is directly tied to the tenant’s payment of rent.
• If one party fails in his or her responsibility (consideration), the other party may be relieved of his or her duty.
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Landlord’s Duties• The landlord is required to put the
tenant in possession. • The landlord does not have an
automatic right to inspect the leased premises.
• The landlord has the right to enter the premises in an emergency and with proper notification.
• The landlord is obligated to have the premises in habitable condition.
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Tenant’s Duties• Maintain the premises with
ordinary wear and tear excepted.• The tenant is expected to use the
premises only for legal purposes and to conform to all local laws.
• Pay the agreed-upon rent in a timely fashion.
• Vacate the premises without the need for legal eviction by the landlord at end of lease.
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Law of Negligence
• The failure to use care that a reasonable person would use in like circumstances.
• A person is liable for damages that result to another person if the duty is not performed in a reasonable fashion.
• The duty of care imposed upon the landlord is the care a reasonable and prudent person would exercise under like conditions.
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Michigan Security Deposits Act
• Regulates how a landlord may handle security deposits received from tenants.
• These laws apply to residential leases only.• A security deposit may not exceed one and
one-half months’ rent.• Tenant must give the landlord a forwarding
address within four days after moving.• Security deposits must be placed in a
regulated financial institution or landlord must post a surety bond with the State.
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Termination and Eviction Remedies
• At expiration of the lease.• The landlord and tenant can
mutually agree to cancel a lease.• Eviction.• Tenant’s claim of constructive
eviction.• Tenant abandons the premises and
the landlord reenters to accept return of possession of the premises.
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TYPES OF LEASES
Gross LeaseNet LeaseGraduated LeaseEscalated LeaseIndex LeaseFixed LeaseReappraisal LeasePercentage LeaseGround LeaseOil and Gas LeasesSale and Leaseback
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CHAPTER TERMINOLOGY REVIEW
assignmentescalated leaseevictionfixed leasegraduated leasegross leaseground leaseholdover tenantindex leaseleaselesseelessorMichigan Security Deposits ActMichigan Truth in Renting Actnegligencenet leaseoption to renew
percentage leasequiet enjoymentreappraisal leaserecapture clausereversionary interestsale and leasebacksecurity depositsublease