English Tenancy Law Case Study

COMMERCIAL TENANCY LAW IN AUSTRALIA

AJ BRADBROOK
CE CROFT

BUTTERWORTHS (1990)

[1.04] the doubt which has been created results from a series of English decisions given in the course of the 1950s and 1960s. In 1952 Denning LJ (as he then was), expressed the view that the test of exclusive possession was by no means decisive: Errington v Errington [1952] 1 All ER 149 at 297; [1952] 1 KB 290. His Lordship said that the difference between a tenancy and a licence was that in a tenancy an interest passed in the land, whereas in a licence it did not; that in distinguishing between a lease and a licence the test of exclusive possession was by no means decisive; that the matter was one of intention and
that, if it appeared that all that was intended was that the occupier should be granted a personal privilege with no interest in the land, he would be held to be only a licensee, notwithstanding that he was given exclusive possession. In Crane v Morris [1965] 3 All ER 77 at 78, Lord Denning went so far as to say:
At one time it was said. That the difference between a licence and a tenancy was that, on a tenancy, the occupier had exclusive possession, but on a licence he had not exclusive possession. We have got long past those days. It is now perfectly well settled that a man may be a licensee (and no tenant) even though he has exclusive possession . . .
Compare his Lordship's reference to "old law which is now gone" in Shell¬Mex and BP Ltd v Manchester Garages Ltd [1971] 1 All ER 841; [1971] 1 WLR 612 at 616.
In Isaac v Hotel de Paris Ltd [1960] 1 All ER 348, the Judicial Committee held that the intention of the parties was the paramount consideration and that, while the fact of exclusive possession was of great importance, if it appeared that all intended was that the supposed lessee should have a personal privilege with no interest in the land, he would be a mere licensee. Thus there appears to be the authority of the Judicial Committee for the proposition that the grant of exclusive possession is not inconsistent with the creation of a mere licence.
Some three months before the decision of the Judicial Committee was given, the High Court gave judgment in Radaich v Smith (1959) 101 CLR 209.
The court was there concerned with the question whether an agreement relating to the use of refreshment rooms was a lease or a licence. Unfortunately, not all members of the court dealt in terms with the question whether the grant of the right to exclusive possession was inconsistent with the creation of a mere licence. McTiernan J at 214, said that the true test of a supposed lease was whether exclusive possession was conferred upon the putative lessee and that the "exclusive possession" test had survived intact the criticism it received in Errington v Errington. Taylor J at 217 held that the effect of the instrument under consideration was to grant a right to exclusive possession and that in consequence it was "inevitable" that the instrument should be held to create a leasehold interest. His Honour
continued:
It will be seen that I have treated the question in this case as concluded by the fact that the instrument conferred upon the appellant the right to exclusive possession for the specified term. And it seems to me that where, as in cases such as the present, it becomes necessary to identify a particular transaction as either a lease or a licence this factor must be decisive. The instrument either makes a grant of an interest in the land or it does not; if it does, a leasehold interest is created and if it does not then nothing more than a licence is given. I do not, of course, overlook that an interest in land -- for example, an easement or a profit a prendre may be created without a grant of possession. Nor do I wish to assert that whenever a legal owner admits another to possession of his land a leasehold interest is necessarily created. For instance, possession given to a builder under the terms of a building contract does not create such an interest. What I have in mind is that where there is a grant of a right for a determinate period in respect of land and the question is posed whether the grant creates a lease or a licence the question may be resolved by considering whether the right in question is a right to exclusive possession.
Menzies J, at 220, regarded the conferring of the right of exclusive possession as decisive. Windeyer J at 222 put the matter as follows:
Whether the transaction creates a lease or a licence depends upon intention, only in the sense that it depends upon the nature of the right which the parties intend the person entering upon the land shall have in relation to the land. When they have put their transaction in writing this intention is to be ascertained by seeing what, in accordance with ordinary principles of interpretation, are the rights that the instrument creates. If those rights be the rights of a tenant, it does not avail either party to say that a tenancy was not intended. What then is the fundamental right which a tenant has that distinguishes his position from that of a licensee? It is an interest in land as distinct from a personal permission to enter the land and use it for some stipulated purpose or purposes. And how is it to be ascertained whether such an interest in land has been given? By seeing whether the grantee was given a legal right of exclusive possession of the land for a term or from year to year or for a life or lives. If he was, he is a tenant. And he cannot be other than a tenant, because a legal right to exclusive possession is a tenancy and the creation of such a right is a demise. To say that a man who has, by agreement with a landlord, a right of exclusive possession of land for a term is not a tenant is simply to contradict the first proposition by the second.
His Honour went on to refer to recent decisions holding that only licences had been created, saying:
These decisions are largely a by-product of rent restriction statutes and other legislation here and in England. They are all explicable if they mean, as I think they all do, that persons who are allowed to enjoy sole occupation in fact are not necessarily to be taken to have been given a right of exclusive possession in law. If there be any decision which goes further and states positively that a person legally entitled to exclusive possession for a term is a licensee and not a tenant, it should be disregarded, for it is self-contradictory and meaningless.
Unfortunately, Dixon CJ contented himself with observing that he had nothing to add to the reasons given by the other members of the court.
Windeyer J had further occasion to consider the nature of a lease in Chelsea Investments Pty Ltd v Federal Commissioner of Taxation [1966] ALR 929; 115 CLR 1. His Honour was there concerned with the "statutory tenancy" of a tenant of prescribed premises after the expiration of a notice to quit. Referring to the statutory tenant, Windeyer J said at (CLR) 6-7:
What rights did the law actually give to Virgona? That rather than their description, is the essential question. It gave him a right to continue in occupation subject to his performing in favour of his landlord the taxpayer what had formerly been his contractual obligations under the lease, to pay rent and so forth. Until he should be ordered by a competent court to give up possession, he had a right to exclusive possession as against all others including his landlord, is the very essence of tenancy. It creates an interest in land: Radaich v Smith (1959) 101 CLR 209. It seems to me that this same right when it flows from statue rather than from contract is an relation to the land, if not, in a technical sense an estate in the land.
In Lapham v Orange City Council (No 2) [1968] 2 NSWR 667 it was held by the Court of Appeal, following Radaich v Smith (1959) 101 CLR 209, that to determine whether a tenancy was created the test was whether there was conferred the right to exclusive possession of the property. Support for the view that exclusive possession is the touchstone of a lease is also to be found in the remarks of Williams J in Clarke v Tyler (1949) 78 CLR 646 at 658, and in the observations of the same judge in Minister of State for the Army v Dalziel (1944) 68 CLR 261. In the latter case his Honour at 305 said:
The principal purpose of the lessee in entering into a lease is to obtain the exclusive possession of the demised property so that he may use and enjoy it for those purposes for which the property is suited and which are not forbidden by the lease. This exclusive possession is, therefore, of the very essence of the proprietary interest conferred upon a lessee by a lessor.
In Goldsworthy Mining Ltd v Federal Commissioner of Taxation (1973) 128 CLR 199; 3 ATR 546 Mason J considered, by way of obiter, whether there was any conflict between Radaich v Smith and the advice in Isaac v Hotel de Paris Ltd [1960] 1 All ER 348. His Honour at (CLR) 212 concluded that the question whether the grant is to be described as a lease rather than as a licence is to be answered initially ". . . by reference to the test: Does it confer on the appellant a right of exclusive possession? (See Radaich v Smith (1959) 101 CLR 209.) The decision of Mason J was followed in Dampier Mining Co Ltd v Federal Commissioner of Taxation (1981) 35 ALR 335, see 348-9, 356. The decision of the Judicial Committee in Isaac v Hotel de Paris Ltd is not, in my opinion, inconsistent with Radakh v Smith". The advice of the Judicial Committee was also considered by the House of Lords in Street v Mountford [1985] 2 All ER 289 at 297. In ICI Alkali (Aust) Pty Ltd (in vol liq) v Federal Commissioner of Taxation [1977] VR 393, McInerney J dealt with the question of whether a document which purported to be a lease from the Governor of the State of South Australia created a leasehold estate having regard to the various limitations placed upon the grantee in relation to the use of the land by the terms of the document and by legislative provisions. In considering this question, His Honour applied the test laid down by Windeyer J in Radaich v Smith, namely, was the grantee given a legal right to exclusive possession of the land for the relevant term, and inclined to the view that in all the circumstances of the case, the grantee acquired a lease and not a licence of the land in question.
More recently, in Lewis v Bell (1985) 1 NSWLR 731, the New South Wales Court of Appeal reviewed the authorities. In that appeal the court considered a document styled "This Licence Agreement" which granted rights in respect of a number of horse boxes and certain other facilities. In a judgment adopted by the other members of the court Mahoney JA applied the test in Radaich v Smith (1959) 101 CLR 209, and the approach adopted by the High Court to determine whether the grantee had been given the right of exclusive possession, that "the court must initially go to the terms of the grant" (quoting Windeyer J at 223: see (1985) 1 NSWLR at 735). In most cases the position will then be clear but there will be circumstances where it is not clear what is being granted, and its context" (Mahoney JA at 735). flis Honour continued at 735:
In deckling, in such cases, whether what has been granted is the right to exclusive possession, the court, in the process of construction, has in practice looked, inter atilt, to two things: the nature of the rights which, in terms, have been granted; and the intention of the parties.
The nature of the rights granted is significant as an inference can be drawn that the grantee was, or was not, granted exclusive possession. The inference has, said Mahoney JA at 735, been put on this basis, at least:
First, it has been held proper to infer that the rights granted do not carry by implication the grant of exclusive possession because the rights granted are inconsistent with the right to exclusive possession. Thus a leasehold interest is an interest in land and, as such, is of its nature transferable: Richardson v Landecker (1950) 50 SR (NSW) 250 at 255; 67 WN 149 at 151. If the right granted is, of its nature, not transferable or is otherwise personal to the grantee it will, as such, not be a leasehold interest: cf Abbeyfield (Harpenden) Society Ltd v Woods [1968] 1 WLR 374 at 376; [1968] 1 All ER 352 (n) at 353. In principle, where the rights are of their nature inconsistent with there being a lease, there will be no implication of a grant of exclusive possession. Second, it has been held necessary to infer the grant of exclusive possession because the rights which have in terms been granted can be enjoyed only by one who has been granted exclusive possession. The grant of exclusive possession has been inferred from the nature of what has been expressly granted. This was the basis of the decision of their Honours in Radaich v Smith (see at 215, 217, 221, 223-5).
Land Reclamation Co Ltd v Basildon District Council [1979] 2 All ER 993 provides an example of an incorporeal right, an easement of way, not capable of being occupied in the ordinary sense. His Honour continued by saying that the usual principles apply to the implication of a grant of exclusive possession as apply generally, namely that "it is necessary in order to give business efficacy to the rights which otherwise have been granted". Reference was made to Codelfa Construction Pty Ltd v State Rail Authority of New South Wales (1982) 149 CLR 337. No implication should be made, said Mahoney JA, if the parties had directed their attention to the matter or expressly provided that no implication was to be made. However, his Honour was apparently not meaning to suggest that it is open to the parties to "declare" an agreement to be of a type at variance with the position at common law. Presumably Lord Templeman's judgment of the House of Lords in Street v Mountford [1985] 2 All ER 289 at 294, which was almost contemporaneous, was not available to Mahoney JA or he may have cited his Lordship's colourful analogy: "The manufacture of a five pronged implement for manual digging results in a fork even if the manufacturer, unfamiliar with the English language, insists that he intended to make and has made a spade". Instead, he relied upon the statement of Windeyer J in Radaich v Smith at 222, that the parties cannot "escape the legal consequences of one relationship by professing that it is another". Nevertheless, this does not mean that the intention is irrelevant but, as Mahoney JA makes clear at 736, 737, it is potentially applicable in two stages in the court's reasoning. The first stage, aspects of which have already been considered, involves construing the document according to the ordinary rules of interpretation and construction. Intention thus gathered may lead the court to read down words that may, out of context, be construed as granting exclusive possession. Any express statement of intention by the parties particularly as to the nature of the relationship to be created “will be of substantial, though not necessarily conclusive importance: it will, in accordance with the rules of construction, yield to the intention to be derived from the document as a whole". Similarly, intention is relevant to another aspect of construction, the implication of terms on the basis of business efficacy. As has already been indicated, this may include the implication of a grant of exclusive possession.
At the time Mahoney JA delivered his judgment, the English and Australian courts appeared to agree on the functions of intention in this first stage but not in the second, the classification stage. It was in this stage that the significance of intention was less in the view of the Australian courts. His Honour said at 737: "Once the nature of the rights granted is finally determined, the classification of the transaction, as lease or licence, will depend upon whether the rights are or are not those of exclusive possession". In other words, no amount of labelling will turn a fork into a spade. As Lord Templeman's statement implies, the House of Lords has recently had occasion to reconsider the English position. His Lordship, in his judgment for the House of Lords in Street v Mountford [1985] 2 All ER 289, reviewed the English authorities and came to the view on the proper role of the intention of the parties as has been taken by the Australian courts. He said at 300:
My Lords, the only intention which is relevant is the intention demonstrated by the agreement to grant exclusive possession for a term at a rent. Sometimes it may be difficult to discover whether, on the true construction of an agreement, exclusive possession is conferred. Sometimes it may appear from the surrounding circumstances that there was no intention to create legal relationships. Sometimes it may appear from the surrounding circumstances that the right to exclusive possession is preferable to a legal relationship other than a tenancy. Legal relationships to which the grant of exclusive possession might be referable and which would or might negative the grant of an estate or interest in the land include occupancy under a contract for the sale of the land, occupancy pursuant to a contract of employment or occupancy referable to the holding of an office. But whereas in the present case the only circumstances are that residential accommodation is offered and accepted with exclusive possession for a term at a rent, the result is a tenancy.
His Lordship followed by saying that "the position was well summarised by Windeyer J sitting in the High Court of Australia in Radaich v Smith (1959) 101 CLR 209 at 222" (the substance of which is contained in the first quote from Windeyer J, above) and concluding with the remark that "I gratefully adopt the logic and the language of Windeyer J". It remains to be seen whether the English Rent Acts will lead to the maintenance of a divergence of approach in particular cases.
There are a number of useful examples of the application of the approach now reaffirmed by the appeal courts: see Hayes v Seymour-Johns (1981) 2 BPR 9366; Streatfield v Winchcombe Carson Trustee Co (Canberra) Ltd [1981] 1 NSWLR 519 at 526-629; Australian Aggregates (NSW) Pty Ltd v Maxmin Pty Ltd (SC, NSW (Hodgson J) 16 May 1988, unreported); AG Securities v Vaughan [1988] 3 All ER 1058 (HL); and see Bretherton v Pawn (1986) 278 EG 615 (CA). In the absence of a written agreement the same principles apply, but the court must draw its own conclusions "as to whether there was or was not a right of exclusive possession from the circumstances and facts of the case in order to see whether the proper inference is that such a term was included by means of, and derived from a history of, such a right being recognise-: Smith v Northside development ltd [1987] 2 EGLR 1951 at 152 (CA); and see Ex parte Robert John Ply Ltd; Re Fostars Shoes Pty Ltd [1963] NSW R 41.9; 63 SR (NSW) 260, considered in Australian Aggregates (NSW) Ply Ltd v Maxmin Ply Ltd at p 46 of his Honour's judgment.

The nature of a licence is considered in [3.01]; see also [3.02] and [3.03] for a further discussion of the distinction between a lease and a licence.
Certainty of agreement necessary
[1.05] As in the case of other binding agreements, the basic terms of a lease must be agreed upon before the lease is capable of being enforced by any party to it. For example, the duration of the term, its date of commencement, the parties to it, and the subject matter of the demise must be agreed upon and must be capable of being ascertained with certainty. (In the case of demise by deed, consideration consists of the seal.) If the grant of the term is affected by means other than a deed, then consideration must be provided by the lessee; this is usually done in the form of a reservation of rent: see Chapter 11. Consequently, the date of the commencement of the term must be specified or be capable of being ascertained. Where no date is fixed for the commencement of the tenancy, it is usually taken to commence at the date of the document or act constituting the demise: see Woodfall on Landlord and Tenant, 28th ed, para 1-0500. If a deed of lease is delivered in escrow the date to be inserted is the date of delivery and rent expressed to run "from the date hereof" will run accordingly: Alan Estates Ltd v W G Stores Ltd [1981] 3 All ER 481. A lease may specify a commencement date prior to the date of its execution: Bradshaw v Pawley [1979] 3 All ER 273. The extent to which the obligations of the parties are effected from the earlier date until the date of execution depends on the terms of the lease; in some cases the earlier date may only be a reference point for fixing the expiry date; in others, obligations may be imposed. Megarry V-C said, in that case ([1979] 3 All ER at 277-8):
I cannot see what there is to stultify an agreement in a lease to make payments in respect of past periods or to require the court to construe a lease so as to prevent any agreement from relating to past periods unless compelled to it. It is by no means unknown for a lease not to be executed until after the prospective lessee has entered (usually with safeguards for the lessor), and for the lessee then to pay rent and observe the terms of the lease as from a date prior to the execution of the lease. If as a matter of construction the obligation is to pay rent at a specified rate from some date earlier than that of the execution of the lease, why should which not be enforceable?
I think that some support for this view is provided by a dictum of Pollock CB in Shaw v Kay. The report in the Exchequer Reports [(1847) 1 Exch 412] that was cited to me omits this, but it is to be found in the report of the case in the Law Journal Reports, Exchequer [17 LJ Ex 17 at 18]. Pollock CB said:
'A party may covenant to indemnify another from what has passed. I may demise premises to-day, and covenant to save my tenant harmless from what has happened six months before.'
On the same footing I do not see why, by suitable wording, a lease should not impose on one of the parties some liability for things past.
Stamp duty considerations may limit the usefulness of this flexibility.
It is sufficient if the commencement becomes certain by the time when the lease is to take effect in possession, and accordingly the term may be made to commence upon the happening of an uncertain event: Bishop of Bath's case (1605) 6 Co Rep 34b; 77 ER 303; Clowes v Hughes (1870) LR 5 Exch 160;
Terry v Tindale (1882) 3 LR NSW 444; Brilliant v Michaels [1945] 1 All ER 121 at 127 8, see also 12.021. The period of the Icon must also be fixed with certainty. A tenancy to continue during the time the tenant, a schoolmaster, was stationed in a particular town: Morison v Edmiston [1907] VLR 191, and a lease to endure for the duration of the war: Anthony v Stanton [19431 VIA 179; Lace v Chandler [1944] 1 All ER 305; [1944] KB 368, have been held to be bad for uncertainty, and these are but illustrations of the general rule that the term must be definite: Binions v Evans [1972] Ch 359 at 366. By lease dated 1 August 1945 the plaintiff leased premises to the defendant for a term of three years "computed from" 1 July 1945, at an annual rent payable by quarterly instalments, the first payment to be made on 1 July 1945, and payments thereafter to be made on the first days of October, January, April and July in each year. It was held that the date of expiry of the lease was 30 June 1948: Box v Lock (1948) 65 WN (NSW) 291. The expression "for the term of 12 months from" was considered in Forster v Jododex Pty Ltd (1972) 127 CLR 421; [1972-73] ALR 1303; see also [2.02]. In the case of a term for fixed years, the maximum duration of the term must be ascertained before the term takes effect (although this requirement probably does not apply to periodic tenancies): Charles Clay and Sons Ltd v British Railway Board [1971] 1 All ER 1007; Centaploy Ltd v Matlodge Ltd [1973] 2 All ER 720. A lease for life may be a lease for a fixed term within the meaning of a statute: Borambil Pty Ltd v O'Carroll (1974) 3 ALR 391. The premises, the subject of the demise, and its boundaries must also be described with certainty. This requirement is satisfied if the description is one which enables the boundaries of the property to be ascertained or defined. In Goldsworthy Mining Ltd v Federal Commissioner of Taxation (1973) 128 CLR 199; 3 ATR 546, Mason J held that part of the sea bed can be the subject matter of a demise if the boundary is described by reference to the surface as it exists from time to time and the mere fact that the boundary may move is not fatal to the validity of the lease. See also Streatfield v Winchcombe Carson Trustee Co (Canberra) Ltd [1981] 1 NSWLR 519 at 529. On the question of certainty, see further [4.02], [6.03] and [14.03] and Chapter 6.
Requirement as to writing
[1.06] By s 52 of the Property Law Act 1958 (Vic), leases of land, except those that are not required by law to be in writing, are void for the purpose of creating a legal estate unless made by deed: Conveyancing Act 1919 (NSW) s 23B (which does not apply to land under the Torrens system); Property Law Act 1974 (Qld) s 10; Law of Property Act 1936 (SA) s 28; Property Law Act 1969 (WA) s 33; Conveyancing and Law of Property Act 1884 (Tas) s 60(1).
Except for Tasmania, all States have dispensed with the requirement for a seal, if the document bears the words "signed, sealed and delivered": NSW, s 38(3); Property Law Act 1958 (Vic) s 73A; Qld, s 45(2), 47; SA, s 41(4); WA, s 9(2), (4). Jordan CJ summarised the effect of the New South Wales requirements in Dockrill v Cavanagh (1944) 45 SR (NSW) 78; and see Enkelmann v Glissan (1982) NSW Cony R 55-084; Alcova Holdings Pty Ltd v Pandarlo Ply Ltd (SC, NSW (Bryson J) 2 May 1988, unreported). In relation to the Western Australian provisions, see Abjomson v Urban Newspapers Pty Ltd (SC, WA (Full Court) 2 December 1987, unreported), especially Kennedy J at pp 9-11 of his Honour's judgment; and Adamson v Hayes (1973) 130 CLR 276 at 298 (Walsh J) and 306 (Gibbs .0. Section 54(1) of the Property Law Act 1958 (Vic) (which reproduces s 2 of the Statute of Frauds) provides that
all

Interest in land created by parol and not put in writing and signed by the persons creating the smile, or by 1heir agents lawfully authorised in writing, hall have, notwithstanding any consideration having been given by the same, the force and effect of interests at will only. Subsection (2), however, provides that
Nothing in the foregoing provisions of this Division shall affect the creation by pawl of leases taking effect in possession for a term not exceeding three years (whether or not the lessee is given power to extend the term) at the best rent which can be reasonably obtained without taking a fine. [NSW, s 23D; Qld, s 12; SA s 30; WA, s 35; Tas, s 60(3), (4).]
Consequently, the position may be summarised as follows:
(1) A lease for a term not exceeding three years and which otherwise complies with s 54(2) may be made verbally, in writing or by deed.
(2) All other leases should be made by deed. If they are not so made, the lessee will be —
(a) At law, at best a yearly (or other appropriate periodic) tenant upon the terms of the lease, so far as applicable;
(b) In equity, a tenant for the appropriate term of years, provided that there is either a sufficient memorandum or a sufficient act of part performance; see further [4.03]-[4.08].
This should be compared to an agreement for a lease which must be in writing even if the contemplated demise is to be only for a month. This is so because of the operation of s 126 of the Instruments Act 1958 (Vic), as to which, see [4.03]: NSW, s 54A; Qld, s 59; SA, s 26; WA, Statute of Frauds 1677 s 4 as amended by the Law Reform (Statute of Frauds) Act 1962; Tas, s 36. As to NSW, s 54A and equitable estoppel, see Waltons Stores (Interstate) Ltd v Maher (1988) 62 ALJR 110 at 129, 135. The grant of a weekly tenancy under which possession is to be given at a future date is not a lease "taking effect in possession" within s 54(2): Haselhurst v Elliot [1945] VLR 153. The lease falls within s 54(2) if it is for a term of three years from the making thereof, and not from a future day: Rawlins v Turner (1699) 1 Ld Raym 736, or if it is for a term commencing on a future day and expiring on a day not more distant than three years from the making of the lease: Ryley v Hicks (1725) 1 Str 651; Kewley v Ball [1913] VLR 412. A lease is for a term not exceeding three years if at the time of the agreement it may last for less than three years, although it may also last for more: Ex parte Voisey; Re Knight (1882) 21 Ch D 442; therefore, yearly: Hammond v Farrow [1904] 2 KB 332 at 335; Dennis & Copley v Eddie [1952] VLR 92 at 99; weekly: Haselhurst v Elliot [1945] VLR 153 and other periodic tenancies may be created verbally; cf the view expressed in Harrison, Cases on Land Law, pp 165-6. In Hand v Hall (1877) 2 Ex D 355 it was held, dealing with corresponding English provisions, that a lease for less than three years containing an option for a further three and a half years was a lease for a term not exceeding three years; see also Roberts v Birkley (1888) 14 VLR 819 at 823-4; Gerraty v McGavin (1914) 18 CLR 152 at 163-4, to the same effect; see too 195 Crown Street Pty Ltd v Hoare [1969] 1 NSWR 193. Until the option is exercised no new or additional interest passes to the tenant: Gerraty v McGavin at 163. In Kushner v Law Society [1952] 1 All ER 404 it was held, distinguishing Ex parte Voisey; Re Knight (1882) 21 Ch D 442, that a lease for a term of 14 years containing a clause whereby the lessee could determine the lease at the end of any year as was a lease for a term exceeding three years within the meaning of the English provision corresponding to s 54(2) (i.e. Law of Property Act 1925 (UK) s 54 (2). Similarly, in Quinlan v Avis (1933) 149 LT 214 it was held that a lease was a lease for a term of not less than two years within the meaning of a provision similar to that to be found in the Landlord and Tenant Act 1958 (Vic) s 48, notwithstanding that the lessee had an option to determine it.
The question arises whether a lease for, say, five years which gives the lessor an option to determine the lease at the end of any year is a lease for a term exceeding three years. Kushner v Law Society suggests that it is, for in that case Lord Goddard CJ said at 407:
It seems to me that we must apply to this document the same principle which has always been applied to the construction of s 4 of the Statute of Frauds, which provides that contracts not to be performed within a year must be in writing. The principle of law, which is now well established and was reaffirmed by the House of Lords in 1912 in Hanau v Ehrlich [1912] AC 39, is that, if a contract is for an indefinite term but can be determined by either party at reasonable notice within the year, the statute does not apply, but, if the contract is for a definite period extending beyond the year, though it may be concluded by notice within a year, the statute does apply. The agreement now before us purports to create a lease for 14 years with a provision that it may be determined earlier. Notwithstanding that provision, the lease is for a definite period.
This passage suggests that it makes no difference whether the option to determine is given to the lessor or the lessee; in neither case will the presence of the option prevent the lease from being one which exceeds three years. In Quinlan v Avis (1933) 149 LT 214 at 215, Talbot J said:
The object of Parliament was that at the time when the premises were decontrolled the tenant should have security for at least two years. That security is not in any way lessened by giving him an option to determine within a shorter period.
The security is, of course, taken away if the landlord has an option to determine the lease.
As can be seen, an oral lease taking effect in possession for a term of say, two and a half years at the best rent which can be reasonably obtained without taking a fine, is good. But an oral agreement to create a weekly tenancy in the future is caught by s 126 of the Instruments Act 1958, so that unless there has been part performance, such an agreement is unenforceable. Agreements for a lease are discussed in Chapter 4. On the question of part performance, see [4.05]. Where the manager of a company acting with due authority signs a lease in his capacity as manager, such writing satisfies s 54(1). In those circumstances, no written authority to the agent is necessary under that section because the manager was not executing the lease as an agent. Rather, the lease was executed by the company, its execution being authenticated by the manager's signature: Richardson v Landecker (1950) 50 SR (NSW) 250.
Section 54(2) applies only if the rent is "the best rent which can be reasonably obtained without taking a fine". The corresponding provisions in the other States are similarly phrased: see Conveyancing Act 1919 (NSW) s 23D (2); Law of Property Act 1936 (SA) s 30(2); Conveyancing and Law of l'roperty Act 1884 (Tas) s 60(4); cf Property Law Act 1974 (Qld) s 12(2); Property Law Act 1969 (WA) s 35(2) which contain no proviso in relation to the rent. The question whether a legal assignment of a lease must be by deed is discussed in [15.07]. A lease which does not fall within s 54(2), and is not made by deed, is void at law. But if the lessee takes possession under a void lease, then at common law a tenancy at will arises; see [2.15]-[2.17] and, on payment of rent, a yearly or other periodic tenancy is created, on the terms of the void lease so far as that can be applied: Martin v Smith (1874) LR 9 Ex 50; 11874 801 All ER Rep Ext 1903; Moore v Dimond (1929) 43 CLR 105; see further 12.091 [2.111. Moreover, in equity, under the doctrine of Walsh v Lon.vdale (1882) 21 Ch D 9; [1881-5] All ER Rep Ext 1690, the lessee under the void lease is in the same position as regards the lessor as if a valid leak has been granted, provided that there is either a sufficient memorandum or some act of part performance; see further [4.05]-[4.08]. A lease under seal can be varied by an agreement not under seal: Plymouth Corporation v Harvey [1971] 1 All ER 623 at 627.
In the New South Wales Conveyancing Act 1919, s 127(1) provides to the effect that "no tenancy from year to year shall be implied by payment of rent and . . . if there is a tenancy and no agreement as to its duration then it shall be deemed to be a tenancy determinable by either party by one month's notice in writing expiring at any time": see Progressive Mailing House Pty Ltd v Tabali Pty Ltd (1985) 57 ALR 609 at 615. Property Law Act 1974 (Qld) s 129(1) and Property Law Act 1969 (WA) s 71 is the only equivalent legislation.
Term and reversion
[1.07] a tenant has an estate or interest in land carved out of the estate of his landlord: Keith v Twentieth Century Club (1904) 52 WR 554; see further [1.02]. The lease creates an interest for a term less than that which the grantor has: Chelsea Investments Pty Ltd v Federal Commissioner of Taxation [1966] ALR 929; 115 CLR 1 at 8. The term must be certain: see Street v Mountford [1985] 2 All ER 289 at 294 and [2.02]. The lease of an estate is in fact the sale of a partial interest in it: Re O'Shea [1957] VR 352 at 356.
The interest which the lessor retains is known as the reversion. Ordinarily, an incident of the reversion is the right to receive from the lessee payment for the use of the land; reservation of rent is not, however, essential: see [1.12].
The reversion may be assigned, thereby creating the relationship of landlord and tenant between the assignee and the original lessee.
The assignment of the term (which creates the relationship between the assignee and the lessor) is considered in [15.011415.11]. The reversion is not necessarily freehold; where the reversionary is himself the holder of a mere leasehold interest, the lease carved out of that interest is called a sublease; see further [1.08].
Subleases
[1.08] the power to grant leases is not confined to the owners of freehold estates: the holder of a leasehold interest may grant a lease. A lease granted by the holder of a leasehold interest is called an under lease or (more commonly) a sublease. In the same way, the holder of the leasehold interest created by the sublease may grant a further lease, called a sub-under lease. Indeed, there is no limit to the number of lesser leasehold estates which may be carved out of the freehold estate. Two rules must, however, be borne in mind. In the first place, a tenancy at will is not an interest which permits of the creation of a sublease: Fink v McIntosh [1946] VLR 290 at 292-3. In the second place, if it is desired to create a sublease as opposed to effect the assignment of the term, some reversion, be it only a day, must be preserved; otherwise the purported sublease will amount to an assignment: White v Kenny [1920] VLR 290. For an example of the retention of a reversion of one day upon the grant of a sublease by the holder of a 55-year building lease, see Re Automotive & General Industries Lid's Lease ((Adam .1), I May 1970, unreported). A purported assignment of less than the whole term is a sublease: 409 Lonsdale Si Ply Ltd v Carra [1974] VIZ 887 at 893.
For the purpose of the rule that a purported sublease will take effect as an assignment if it in fact transfers the whole of the interest of the supposed sub lessor a tenancy from year to year is regarded as a tenancy which continues until it is in fact determined; accordingly a tenant from year to year may grant a sublease from year to year or even for a term of years: Oxley v James (1844) 13 M & W 209; 153 ER 87; 409 Lonsdale St Pty Ltd v Carra at 893; W Skelton Ltd v Harrison & Pinder [1975] QB 361 at 367. This principle applies to other periodic tenancies, and a weekly tenant may sublet the premises from week to week: Woods v Moses [1953] ALR (CN) 1165. Subleases are further discussed in [15.02]-[15.04A].
Concurrent leases
[1.09] where a lease is already in existence the lessor may grant a further lease, concurrent with the existing term. Such a lease is known as a concurrent lease. It is a lease for a term to commence in praesenti, subject to an existing lease: Stewart v Goldman & Co Pty Ltd (1947) 64 WN (NSW) 155.
A concurrent lease operates as an assignment pro tanto of the reversion: Land v Clyne (1968) 92 WN (NSW) 134. It may be defined as a lease of the reversion immediately expectant on an existing lease: Wordsley Brewery Co v Halford (1903) 90 LT 89; Carberry v Gardiner (1936) 36 SR (NSW) 559 at 577; Stewart v Goldman & Co Pty Ltd (1947) 64 WN (NSW) 155; Cook v Evans (1948) 49 SR (NSW) 83; Richardson v Landecker (1950) 50 SR (NSW) 250. A concurrent lease interposes the concurrent lessee between the existing lessor and lessee, the concurrent lessee becoming the landlord of the existing lessee: Buckby v Speed [1959] Qd R 30; Land v Clyne (1968) 92 WN (NSW) 134. The concurrent lessee is, accordingly, the proper person to determine the existing lease, for example, by giving notice to quit, where this is an appropriate mode of determining it: Stewart v Goldman & Co Pty Ltd or by re-entry in an appropriate case: London and County (A & D) Ltd v Wilfred Sportsman Ltd [1970] 2 All ER 600, in the headnote to which the second lease is wrongly described as a reversionary lease. It is the concurrent lessee who is entitled to possession on the termination of the existing lease and it is he who can maintain ejectment proceedings on the termination of that lease: Traynor v Thompson [1953] VLR 706 at 717. This is so even if the existing term is brought to an end prematurely, as by surrender: Neale v Mackenzie (1836) 1 M & W 747 at 762. The concurrent term, while it must begin before the expiration of the earlier term, may end either before or after the earlier term.
A concurrent lease is not a future lease, to be enjoyed only when the earlier term comes to an end. A concurrent lease gives forthwith a right to the rents arising from the existing lease and to the benefit of the tenant's covenants therein contained: .Re Moore & Hulrrz's Contract [1912] 2 Ch 105; Cole v Kelly [1920] 2 KB 106; [1920] All ER Rep 537; Neale v Mackenzie (1836) 1
M & W 747; Noone v Traynor (1952) 69 WN (NSW) 33 at 35; Traynor v Thompson, supra, at 716; Property Law Act 1958 s 149(5). A future, or reversionary, lease is one which is to commence in reversion, that is to say, which is not to take effect until some date in the future. Future leases are the subject of [1.10].
A tenant whom has granted a sublease may grant a concurrent sublease:
Woods v Moses 1953fAI,R (CN ) 1165.
Concurrent leases enjoyed a brief and unwonted popularity some years ago in Victoria as a device for evading the operation of s 85(1) of the Landlord and Tenant Act 1958 (Vic). By this section, a person who became the lessor of prescribed premises, being a dwelling-house, by purchase, transfer of assignment thereof or of a lease thereof was prohibited from giving notice to quit on the ground that he reasonably required the premises for occupation by himself until after the expiration of a period of 12 months from the date of the agreement of the purchase, transfer or assignment of the premises or of the lease thereof. In order to introduce upon the scene a new lessor having prospects of obtaining an ejectment order while evading the restriction on giving notice to quit contained in this section, existing lessors frequently granted concurrent leases. This device was for a time successful, it being held that the words "by purchase" did not include the taking of a concurrent lease: Cook v Evans (1948) 49 SR (NSW) 83; Kirsch v Auhl [1949] VLR 324. The gap in the legislation was closed by an amendment made by the Landlord and Tenant Act 1953 (No 5760), which made the section extend to a person who became lessor by the grant of a concurrent lease: see s 85 of the Landlord and Tenant Act 1958.
Future or reversionary leases
11.10] A lease may be granted to take effect in possession either at once or from some date in the future. Further, a lease may be made to commence from a date in the past: a large proportion, if not indeed the majority, of leases executed are of this kind. It is not possible, however, by a lease executed, say, in February 1970 to create a term beginning on 15 December 1969 in the sense of bringing into existence a term before the date of the execution of the lease. In such a case, the lease relates back to the date from which the term is expressed to commence only for the purpose of marking the duration of the lessee's interest: its operation as a grant is merely prospective from the date of its execution: Shaw v Kay (1847) 1 Ex 412; 154 ER 175; King v McIvor (1883) 4 LR (NSW) 43; 4 ALT 153; Fernhill Railway Co v Mayor of Dunedin [1884] NZLR (SC) 86; Cadogan v Guinness [1936] 2 All ER 29; [1936] Ch 515; Queensland Television Ltd v Federal Commissioner of Taxation (1969) 1 ATR 419; 119 CLR 167; Roberts v Church Commissioners for England [1972] 1 QB 278; Perpetual Trustee Co Ltd v Morley (1968) 121 CLR 659 at 662-3; Bradshaw v Pawley [1979] 3 All ER 273; Brikom Investments Ltd v Seaford [1981] 2 All ER 783 at 786. In relation to agreements for lease, see [4.01].
A lease granted to take effect in possession from some date in the future is a future lease; such leases, since they take effect in reversion, are also called reversionary leases.
Future leases must not be confused with concurrent leases. An example of the confusion of the two kinds of lease is found in the headnote to London and County (A & D) Ltd v Wilfred Sportsman Ltd [1970] 2 All ER 600, where a concurrent lease is misdescribed as a reversionary lease. A concurrent lease is a lease which is to take effect immediately in possession, subject to an existing lease. Further leases are leases in reversion: concurrent leases are leases of the reversion. See [1.09].
Although the expressions "future lease" and "reversionary lease" are generally treated as synonymous, the latter is by some reserved for those future lease in which the term commences after the determination of some either lease: Green v Bowes- Lyon 11%01 1 All FR 301; [19601 1 WI R 176 at 181, as opposed to future leases where the date of commencement of term is fixed in some other manner. An example of a reversionary lease in the narrow sense will be found in Fuller's Theatre & Vaudeville Co Ltd v Rofe, [1923] AC 435 at 438.
By the doctrine of interesse termini, actual entry had to be made by the tenant in order to perfect his title. Until entry he had no estate in the land, but only a right of entry, which was called his interest in the term, or interesse termini: Joyner v Weeks [1891] 2 QB 31 at 47; [1891-4] All ER Rep Ext 1438. This doctrine has been abolished by statute: Property Law Act 1958 s 149(1). The only limitation now in respect of the grant of future leases is that contained in s 149(3) of the Property Law Act 1958 (Vic), whereby a term, at a rent or granted in consideration of a fine, limited after the commencement of the Act to take effect more than 21 years from the date of the instrument purporting to create it shall be void, and any contract made after such commencement to create such a term shall likewise be void: Conveyancing Act 1919 (NSW) s 120A(3); Property Law Act 1974 (Qld) s 102(3); Property Law Act 1969 (WA) s 74(3). The subsection does not apply to any term taking effect under a settlement, or created out of an interest under a settlement, or under a power for mortgage, indemnity or other like purposes. The effect of this provision is considered in Re Strand and Savoy Properties Ltd [1960] 2 All ER 327; [1960] Ch 582; and Weg Motors Ltd v Hales [1961] 3 All ER 181; [1962] Ch 49.
Building leases
[1.11] a building lease contains a covenant by the lessee to erect buildings on the demised land. The covenant may be either to erect a building on vacant land or to pull down old buildings and erect new ones in their place. A building lease is to be contrasted with a repairing lease: City of London v Nash (1747) 3 Atk 512 at 513-14; 26 ER 1095. The rent paid by the lessee under a building lease is known as ground rent; see [1.12].
Rent
[1.12] The only necessary characteristic of any tenancy is that it should give the right of exclusive possession to the tenant for an ascertainable period of time; reservation of rent is not essential: Weston v Ray [1946] VLR 373 at 377; Francis Longmore & Co Ltd v Stedman [1948] VLR 322 at 323; Burns v Dennis (1948) 48 SR (NSW) 266, and other authorities referred to and applied in Hayes v Seymour-Johns (1981) 2 BPR 9366 at 9369; cf Street v Mountford [1985] 2 All ER 289 at 294, but explained in Ashburn Anstalt v Arnold [1988] 2 All ER 147 (CA) on the basis that Lord Templeman could not have meant "no rent, no lease" for this would be inconsistent with Law of Property Act 1925 (UK) s 205(1)(xxvii) (see Property Law Act 1958 (Vic) s 18(1)) and the judgment of Windeyer J in Radaich v Smith (1959) 101 CLR 209 at 222, which was expressly approved in Street v Mountford at 300. Accordingly, the Court of Appeal held that the reservation of a rent was not necessary for the creation of a tenancy. The parties sometimes stipulate for a nominal rent in the mistaken belief that reservation of rent is essential to the creation of a tenancy. For an example of a peppercorn rent, see R v Registrar of Titles; Ex parte Commonwealth (1915) 20 CLR 379; see further, Chapter 11.

Rack rent is a rent of the full value of the holding or near it : 2 B1 Com 43 Re Sawyer & 19191 2 Ch 133, Rack rent is to be contrasted with ground rent. The latter expression is sometimes loosely used. The context in which it appears may materially affect its meaning: Stewart v Alliston (1815) I Mer 26; 35 ER 587. Ground rent is the rent at which land is let for the purpose of improvement by building. It carries with it the reversionary interest in buildings erected after the date of the lease. "The term ground rent is well understood and has a definite meaning; it is the sum paid by the owner or builder of houses for the use of land to build on, and is therefore much under what it lets for when it has been built on": Bartlett v Salmon (1855) 6 De G M & G 33 at 41; 43 ER 1142.
Leaseholds as personalty
[1.13] By an exception to the general rule that rights over land are regarded as real property, leasehold interests are held to be personal estate. Personal estate consists in part of chattels real and in part of chattels personal. Leaseholds are chattels real. As they are interests in land, they bear many analogies to realty: Union Bank of Australia v Harrison Jones & Devlin Ltd (1910) 11 CLR 492 at 526; Minister of State for the Army v Dalziel (1944) 68 CLR 261 at 299.
Although leasehold interests are personal property, the rule in Flureau v Thornhill (1776) 2 Wm BI 1078; 96 ER 635; [1775-1802] All ER Rep 91, limiting the damages recoverable from a vendor of real estate who has acted in good faith and is unable to make title, applies to agreements to grant a lease; see [13.04].
Tenancy by attornment
[1.14] At common law an assignment of the reversion could not be completed without an attomment by the tenant (Doe d Wright v Smith (1838) 8 Ad & El 255 at 260), the attornment being the act of the tenant putting one person in the place of another as his landlord: Cornish v Searell (1828) 8 B & C 471; 108 ER 1118; Gerard Estates Pty Ltd v McGregor [1967] 2 NSWR 292; 86 WN (Pt 1) (NSW) 156. This situation has been remedied by statute; by s 151 of the Property Law Act 1958 (Vic), the conveyance of the reversion is valid without any attornment of the lessee: see Conveyancing Act 1919 (NSW) s 125. As to whether this section applies to an oral lease, see Gerard Estates Pty Ltd v McGregor. The tenant may safely continue to pay rent to the previous landlord until he is given notice of the assignment. Notice of the assignment need not be given before bringing ejectment for breach of covenant other than a covenant to pay rent: Shaltock v Harston (1875) 1 CPD 106. The section has no application where at the time of the assignment the tenant has no interest in the land, as where he had assigned: Allcocks v Moorhouse (1882) 9 QBD 366. For the position where the assignee relies on s 79 of the Supreme Court Act 1986 (Vic) (see [19.03] for corresponding provisions in other States), and the half-year's rent accrued due partly before and partly after the date of the assignment, see Rickett v Green [1910] 1 KB 253.
In modern times the expression "attornment" has come to be commonly used, not in the special sense of the acknowledgment of the tenant which was formerly necessary to complete an assignment of the reversion, but in the more general sense of any acknowledgment or admission of the existence of a tenancy. Attornment clauses, whereby the mortgagor or purchaser "attorns

And becomes” tenant to the mortgage or vendor, are almost invariably inserted into mortgages and "terms" contracts of sale of land.
At attornment clause operates to create a tenancy by estoppel if the facts are such that a true tenancy is not created: Cole on Ejectment pp 219, 230; Partridge v McIntosh & Sons Ltd (1933) 49 CLR 453; Ex pane Jackson; Re Australasian Catholic Assurance Co Ltd (1941) 41 SR (NSW) 285; A NZ Bank Ltd v Strelitz [1964] NSWR 401; Regent Oil Co Ltd v J A Gregory (Hatch End) Ltd [1965] 2 All ER 90; [1966] Ch 402; City Mutual Life Assurance Society Ltd v Lance Creek Meat Works Pty Ltd [1976] VR 1.
See further [20.08] and Cam & Sons Pty Ltd v Commissioner of Land Tax [1965] ALR 852; 112 CLR 139.
Leases created by estoppel
[1.15] In addition to tenancies by estoppel created by an attornment clause in the circumstances referred to in the preceding paragraph, the courts have recognised the creation of leases by estoppel in other circumstances. In Taylor Fashions Ltd v Liverpool Victoria Trustees Co Ltd [1981] 1 All ER 897 the tenant took a lease for 28 years with an option for a further 14. In the belief that it had an option the tenant installed a lift at substantial cost but, unknown to both the landlord and the tenant, the option was void, not having been registered under the Land Charges Act 1925 (UK). It was held that the landlord was estopped from asserting the invalidity of the option on the basis of representations made as to the validity of the option and also because the landlord had encouraged one of the plaintiffs to incur expenditure and alter their position irrevocably by taking additional premises on the basis that the option was valid. The tenant in Andrews v Colonial Mutual Life Assurance Society Ltd [1982] 2 NZLR 556 had expended a substantial sum of money in refurbishing and recarpeting the premises. The work took place with the landlord's knowledge and agreement, the landlord having confirmed that they were prepared to offer the tenant a new lease for three or six years. It was held that the plaintiffs were entitled to succeed on the basis of proprietary estoppel. After reviewing the authorities (see 567-9) Barker J said (at 570):
Whether or not the defendant considered there to be a contract for a new lease, its conduct throughout was such as to give rise to an action based on proprietary estoppel. When the defendant learned of the extensive refurbishing to be undertaken by the plaintiffs, the defendant should have concluded that the plaintiffs were undertaking this work in the belief that they were to have a new lease on the terms of the letter. Yet, the defendant did nothing to disabuse them of that view".
Similar issues arose more recently in the High Court in Waltons Stores (Interstate) Ltd v Maher (1988) 62 ALJR 110. In summary, the facts were that Mr and Mrs Maher purchased land in the commercial centre of Nowra for commercial development. A substantial brick building and two dilapidated buildings stood on the land. After negotiations with Waltons it was agreed that the Mahers would replace these buildings with a new building, designed specifically to suit Waltons' requirements, which would be leased to Waltons for six years with a six-year option. Waltons' solicitors sent an agreement for lease and draft lease to the Mahers' solicitors on 21 October 1983. Some amendments were required, which were incorporated in fresh documents which were prepared by Waltons' solicitors. On 11 November the Mahers' solicitors forwarded the executed documents "by way of exchange" to Waltons' solicitors. Demolition work then began on the new brick portion of the old building work was approximately 40 per cent completed, Waltons' informed the Mahers' solicitors that Waltons did not intend to proceed, the contracts not having been exchanged. The appeal was dismissed, the High Court being of the view that Waltons was estopped from denying that a concluded agreement existed. Mason CJ and Wilson J, in a joint judgment, said (at 117):
The second factor of importance is that the respondents executed the counterpart deed and it was forwarded to the appellant's solicitor on 11 November. The assumption on which the respondents acted thereafter was that completion of the necessary exchange was a formality. The next their solicitor heard from the appellant was a letter from its solicitors dated 19 January, informing him that the appellant did not intent to proceed with the matter. It had known, at least since 10 December that costly work was proceeding on the site.
It seems to us, in the light of these considerations, that the appellant was under an obligation to communicate with the respondents within a reasonable time after receiving the executed counterpart deed and certainly when it learnt on 10 December that demolition was proceeding. It had to choose whether to complete the contract or to warn the respondents that it had not yet decided upon the course it would take. It was not entitled simply to retain the counterpart deed executed by the respondents and do nothing: cf Thompson, at [49 CLR] 547; Olsson v Dyson (1969) 120 CLR 365 at 376. The appellant's inaction, in all the circumstances, constituted clear encouragement or inducement to the respondents to continue to act on the basis of the assumption which they had made. It was unconscionable for it, knowing that the respondents were exposing themselves to detriment by acting on the basis of a false assumption, to adopt a course of inaction which encouraged them in the course they had adopted. To express the point in the language of promissory estoppel the appellant is estopped in all the circumstances from retreating from its implied promise to complete the contract.
It is not the purpose of this work to examine estoppel in any detail. The reader is referred to the leading texts: Meagher, Gummow and Lehane, Equity, Doctrines and Remedies (2nd ed) and P Finn (ed), Essays in Equity.
Abolition of doctrine of interesse termini
[1.16] by the doctrine of interesse termini, actual entry had to be made by the lessee in order to perfect his title. Until entry, he had no estate in the land, but only a right of entry which was called his interest in the term, or interesse termini: Joyner v Weeks [1891] 2 QB 31 at 47; [1891-4] All ER Rep Ext 1938. The doctrine did not apply to a lease for life: Ecclesiastical Com¬missioners for England v Treemer [1893] 1 Ch 166. An interesse termini was assignable, and on death passed to the lessee's personal representative: Doe v Walker (1826) 5 B & C 111. Until the lease was perfected by entry, the lessee could not maintain an action for trespass, for this action is based on actual possession: Ryan v Clarke (1849) 14 QB 65 at 73; he might, however, bring ejectment: Doe d Parsley v Day (1842) 2 QB 147, or maintain an action against his landlord for not putting him in possession: Wallis v Hands [1893] 2 Ch 75; [1891-4] All ER Rep 719. As to this doctrine generally, see (1960) 24 Conveyancer 462. The doctrine has been abolished by statute: see Conveyancing Act 1919 (NSW) s 120A(1); Property Law Act 1958 (Vic) s 149(1); Property Law Act 1974 (Qld) s 102(1); Residential Tenancies Act 1975 (Qld) s 12; Law of Property Act 1936 (SA) s 246; Property Law Act 1969 (WA) s 74(1).
KIND OF TENANCY.
The five kinds of tenancy
[2.01] If the tenancy at sufferance is regarded as a tenancy, there are five kinds of tenancy:
(1) tenancy for a fixed term;
(2) tenancy from year to year;
(3) periodic tenancy for less than a year;
(4) tenancy at will;
(5) tenancy at sufferance.
It is proposed to say something as to the nature and incidents of each of these in turn.
Tenancy for a fixed term — certainty
[2.02] This is a lease for a fixed period of time. The term will often be several years, but it may be any fixed period, for example, six months: Box v Attfield (1886) 12 VLR 574, or even six days. In Thorn v Martin (1960) 77 WN (NSW) 301, the lease was for a term of one week, a circumstance adverted to by Maguire J in Ex parte Monters Pty Ltd; Re Webster [1960] NSWR 521; [1961] SR (NSW) 354. A lease for a "term of years" (which must be for two years at least: Land Settlement Association Ltd v Carr [1944] 2 All ER 126; [1944] 1 KB 657; cf Re Land at Liss [1971] Ch 986), is an example of a lease for a fixed term, but parties may fix any period they please, provided that they comply with the rule which requires that a certain period be fixed: see Street v Mountford [1985] 2 All ER 289 at 294. A tenancy to continue during the time the tenant, a schoolmaster, was stationed in a particular town: Morison v Edmiston [1907] VLR 191, and a lease to endure for the duration of the war: Anthony v Stanton [1943] VLR 179; Lace v Chandler [1944] 1 All ER 305; [1944] KB 368, have been held to be bad for uncertainty, and these are but illustrations of the general rule that the term must be definite: Binions v Evans [1972] Ch 359 at 366. A lease for life may be a lease for a fixed term within the meaning of a statute: Borambil Pty Ltd v O'Carroll (1974) 3 ALR 391. As to the requirement that the relevant terms of the lease must be capable of being ascertained with certainty, see [1.05].
The commencement of the term must be certain, but it is sufficient if the commencement becomes certain by the time when the lease is to take effect in possession, and accordingly the term may be made to commence upon the happening of an uncertain event: Bishop of Bath's case (1605) 6 Co Rep 34b; 77 ER 303; Clowes v Hughes (1870) LR 5 Exch 160; Terry v Tindale (1882) 3 LR NSW 444; Brilliant v Michaels [1945] 1 All ER 121 at 127-8.
By lease dated 1 August 1945 the plaintiff leased premises to the defendant for a term of three years "computed from" 1 July 1945, at an annual rent payable by quarterly instalments, the first payment to be made on 1 July 1945, and payments thereafter to be made on the first days of October, January, April and July in each year. II was held that the date of expiry of the lease was

30 June 1948: Box v Lock (1948) 65 WN (NSW) 291. The expression “for the term a twelve months from" was considered in Forster v Jododex Ply Lid (1972) 127 CIA 421.
Automatic expiration
12.03] A lease for a fixed term expires automatically at the end of that term: Cobb v Stokes (1807) 8 East 358; 103 ER 380; see too [16.05]. Similarly, a lease will automatically come to an end upon the happening of an event upon which it is expressed to determine: Right d Flower v Darby (1786) 1 Term Rep 159 at 162; 99 ER 1029; Swift v Macbean [1942] 1 All ER 126. It may have been agreed between the parties, however, that the tenancy is to continue after the expiration of the term until a stated notice is given, and in such a case the tenancy will continue until it is determined by the requisite notice: Brown v Trumper (1858) 26 Beav 11; 53 ER 800. It must be emphasised that, unless the parties have agreed that a tenancy on certain terms is to exist after the expiration of the fixed period, the lease will automatically come to an end upon the expiration of the fixed period; in other words, a lease for a fixed term is determined by effuxion of time without the need for any notice to quit or other act. If a lessee for a fixed term remains in possession after the expiration of that term, he may, unless there is something in the facts warranting the conclusion that a new tenancy has been created, be ejected without notice; the mistaken view that notice to quit is required in such circumstances is thought to have its origin in the former predominance of prescribed premises and the operation of legislation such as Pt V of the Landlord and Tenant Act 1958 (Vic), whereby "lessee" is defined as including an overholding tenant: s 43(2), and notice to quit on a prescribed ground is a prerequisite to the recovery of possession from a lessee: s 82. Similarly, it is thought that the erroneous notion prevalent in some quarters that the giving of notice to quit is the usual means of forfeiting a lease for breach of covenant has the same origin.
Provision for notice — overholding clauses
[2.04] Reference has already been made to the fact that, while ordinarily a lease for a fixed term automatically comes to an end upon the expiration of that term, the parties may agree that the lease is to continue until determined by notice. So a lease for a fixed term may itself provide that, if notice is not given to determine the lease at the end of the term the tenancy shall continue as a yearly tenancy: Brown v Trumper (1858) 26 Beav 11; 53 ER 800. In such a case the provision for the continuance of the lessee's interest or the creation of some new interest in the lessee is contained in the lease itself. This must be distinguished from the case where a lessee holds over after the expiration of the lease and pays rent and there is attributed to the parties the intention of creating a new tenancy, often a tenancy from year to year (but note the New South Wales, Queensland and Western Australian legislation referred to in [2.14]). See for example, Christopher v Wright [1949] VLR 145 at 147. The case of the over holding clause must also be considered. While an over holding clause may be drawn in terms which show an intention that a new tenancy shall arise upon the expiration of the original term, it will ordinarily be in a form which does not speak on the question whether a new tenancy is to arise after the expiration of the term and which is intended only to secure that, if a new tenancy is created by the conduct of the parties, that new tenancy shall be determinable by a short period of notice (often one month). See Hamilton v Porta [1958] VR 247 at 250 I , and contrast Ex parte' Molders Pty ltd; Re
Webster [1960] NSWR 521; I 19611 SR (NSW) 354; sec also Di Tonle v Zollo [1977] VR 547.
As to the terms on which an overholding tenant holds the premises, see [7.13]; see also [2.09]-[2.11].
Fixed terms and notices to quit
[2.05] A lease for a fixed term will not ordinarily be determined by notice to quit. The parties may agree, however, that it shall be so terminable, and such agreement is effective. It is well settled that the incorporation into a lease for a fixed term of a right to terminate the lease on giving certain notice is not bad for repugnancy. See for example, Porter v Williams (1914) 14 SR (NSW) 83. The lease may provide for the giving of what may perhaps be described as notice to quit in either of two types of case; on the question of terminology see Foa on Landlord and Tenant, 8th ed, at 586 note (c). In the first place, the lease may confer upon the landlord, or the tenant, or both, an option to determine it before the expiration of the agreed term. This right may be made exercisable only at a specified time, for example, at the end of the fifth year of the term, or in a specified event, for example, if the landlord requires the premises for a certain purpose. Occasionally, the right to determine is given without its being limited either by the fixing of a time at which it is to be exercised or the naming of events upon which it is to arise. It is usual to require the party exercising his option to determine the lease to give a certain period of notice to the other.
In the cases so far discussed the right to determine the lease has not been connected with any default by the other party. A well-drawn lease for a fixed term will confer upon the lessor the right to determine the lease in the event of a breach of covenant on the part of the lessee and in certain other events, ordinarily being events which reflect upon the solvency of the lessee. This provision usually empowers the lessor to determine the lease by re-entry, and re-entry does not require the giving of any notice to quit. Occasionally, a poorly drawn lease is found which empowers the lessor, in the case of a breach of covenant or the occurrence of one of the other specified events, not to re-enter, but to give notice to quit of a short period specified in the lease; to require the giving of some specified period of notice as opposed to mere re-entry has nothing to commend it from the point of view of the lessor.
It may be observed in passing that, just as leases occasionally stipulate for the giving of notice to quit instead of re-entry as the means of effecting a forfeiture, so tenancy agreements creating periodic tenancies occasionally provide not only for the giving of notice to quit, but also for determination without notice by way of forfeiture; see [17.01]. The provision occasionally found in leases whereby the giving of a period of notice instead of re-entry is stipulated for as a means of forfeiting the lease must not be confused with the reference frequently made in well drawn leases to the giving where appropriate of the notice required by s 146 of the Property Law Act 1958 (Vic): Conveyancing Act 1919 (NSW) s 129; Property Law Act 1974 (Qld) s 124; Landlord and Tenant Act 1936 (SA) s 10; Property Law Act 1969 (WA) s 81; Conveyancing and Law of Property Act 1884 (Tas) s 15.
Ejectment of overholding tenant
Where one who has been lessee of premises and whose term has come to an end remains in possession against the will of his landlord, he is a trespasser: Fry v Metzelaar [1945] VLR 65 at 67. Where such a person remains in possession without either the assent or dissent of his landlord, he is a tenant at sufferance (ibid). The distinction is without importance so far as the recovery of possession is concerned, for even if the former lessee has remained in possession without the dissent of the lessor and so become a tenant at sufferance, he may be ejected without any previous notice to quit or demand of possession: Natural Gas & Oil Corporation Ltd v Byrne (1951) 68 WN (NSW) 207 at 213. Except in the case where the lease itself provides for the creation of some further tenancy, the lessor is accordingly, where the lessee remains in possession after his term has come to an end, entitled to recover possession without notice to quit or demand of possession, unless there has been some subsequent creation of a further tenancy either by express agreement or by conduct from which an agreement is to be inferred; see also [2.04] Character of tenancy from year to year
[2.07] A tenancy from year to year, also known as a yearly tenancy, is merely an example of a periodic tenancy. In the case of a periodic tenancy, there is not a new tenancy with the beginning of each recurring period, but a tenancy which continues indefinitely until termination: Amad v Grant [1947] ALR 191; 84 CLR 327 at 336; Commonwealth Life (Amalgamated) Assurance Ltd v Anderson (1945) 46 SR (NSW) 47; Gleeson v Richey [1959] VR 258 at 261; Bemays v Prosser [1963] 2 All ER 321; [1963] 2 QB 592.
Determination of yearly tenancies
[2.08] A tenancy from year to year differs from the lesser periodic tenancies in that the period of notice required for its determination is not the recurring period (a year), but only half a year: Landak v Menzies (1909) 16 ALR 217; 9 CLR 89 at 101. The notice must expire at the end of a year of the tenancy, but this requirement is regarded as satisfied, not only in cases where the tenant is in terms required to quit on the last day of the year, but also in cases where he is required to quit on the anniversary of the commencement of the year, provided that in the latter case no language is used which will not permit the notice to be construed as requiring the tenant to quit at the first moment of the anniversary. See Sidebotham v Holland [1895] 1 QB 378; Bathavon Rural Or District Council v Carlile [1958] 1 All ER 801; [1958] 1 QB 461, and the other decisions cited in [20.05] in relation to the lesser periodic tenancies. Section 32(2) of the Landlord and Tenant Act 1958, whereby in the case of the summary proceedings to recover possession in a magistrates' court under Pt IV of the Act a notice to quit shall not (unless otherwise expressly agreed) be invalid by reason only of the fact that it expires on a day other than the day of expiry of a recurring period, has no application to tenancies from year to year; the provision applies only to periodic tenancies the recurring period of which does not exceed one month: see Conveyancing Act 1919 (NSW) s 127; Landlord and Tenant Act 1899 (NSW) s 22A; Property Law Act 1974 (Qld) ss 129, 131, 133(2); Property Law Act 1969 (WA) s 72.
Yearly tenancy presumed where tenant holds over
[2.09] A lessee who remains in possession after the expiration of a lease for a term without the assent or dissent of the lessor is a tenant at sufferance:
Natural Gas & Oil Corporation v Byrne (1951) 68 WN (NSW) 207 : and see Longrigg, Burrough : and Trounson v Smith (1979) 251 EG 847 (CA). In certain circumstances the lessee will, once rent is accepted by the lessor, become a tenant from year to year (but see the New South Wales, Queensland and Western Australian legislation referred to in [2.14]). Unless the parties have agreed otherwise, the notice required to determine a yearly tenancy is half-a-year's notice expiring at the end of a year of the tenancy: Landale v Menzies (1909) 16 ALR 217; 9 CLR 89 at 101. For these reasons, an overholding clause is inserted in well-drawn leases. In Hamilton v Porta [1958] VR 247 the lease contained a clause in the following terms:
Provided always that no overholding …shall be construed as creating a tenancy from year to year, but that notwithstanding the failure of the tenant to vacate the premises upon expiration of the said term or of the landlord to require possession at such expiration or payment and receipt of rent by the landlord and tenant respectively the tenant's occupancy or possession of the leased premises after the expiration of the said term may be determined by either the landlord or the tenant at any time upon one month's written notice…
Herring CJ stressed that this clause did not speak on the question whether a new tenancy was to be inferred after the expiration of the term. That was a question which could be determined only by reference to the intention of the parties, with regard to which no help could be derived from the terms of the clause. The effect of the clause was merely that in the event of an overholding after the expiration of the term from which a new tenancy was to be inferred, such new tenancy would, in the absence of any agreement to the contrary between the parties, be terminable on a month's notice on either side. The possibility of the existence of a yearly tenancy is in practice often overlooked in proceedings for the recovery of possession from a tenant who has held over after the expiration of a lease for a fixed term; see also [2.04].
Holding over after short terms
[2.10] the authorities conflict on the question when a yearly tenancy is created as the result of the tenant's holding over. It is clear that the doctrine of a presumed yearly tenancy applies not only where the term was for a period of years, but also where it was for a year certain: Bank of Victoria v M'Hutchison (1881) 7 VLR (L) 452; Box v Attfield (1886) 12 VLR 574; Adler v Blackman [1952] 2 All ER 41; [1953] 1 QB 146. In Box v Attfield the Full Court expressed the opinion that it was "sufficiently plain" that the doctrine applied where the tenant held over after the expiration of a term of six months. In Solomon v Bray (1873) 7 SALR 128 the Full Court of South Australia held that to make a tenant holding over and paying rent a tenant from year to year the original letting must have been for a year or an aliquot part of a year, or at a yearly rent; therefore, a letting for a period of 18 months at a weekly rental was not a letting from year to year, and where a tenant held over beyond such period, and continued to pay rent as before, he was merely a weekly tenant. Cussen J in Beattie v Fine [1925] VLR 363 at 374, spoke of a yearly tenancy's being implied "where a tenancy extends over one year or a number of years": see also [2.04].
Holding over where weekly rent reserved
[2.11] the second question which arises is whether a yearly tenancy is to be presumed only if the rent is paid by reference to a year, or at least an aliquot part of a year. Here the authorities undoubtedly conflict.
In Adler v Blackman [1952] 2 All ER 41; [1953] 1 QB 146 the Court of Appeal held that it was essential to the presumption of a yearly tenancy that the rent should be expressed as all annual sum, though it might be payable half yearly, quarterly, monthly or even weekly. There was no presumption of a yearly tenancy where the rent was stated as a rent per week and not as an instalment of the rent fixed for a year. In that case the Court of Appeal applied the dictum of Maugham J in Ladies' Hosiery & Underwear Ltd v Parker [1930] 1 Ch 304 at 328; [1929] All ER Rep 667, and disapproved the decision of Macnaghten J in Covered Markets Ltd v Green [1947] 2 All ER 140. Similarly, in Ball & Huntley v Laffin (1876) 10 SALR 6 at 12, Stow J said that whether the tenancy was created by entry under a void lease or an agreement for a lease, or by holding over after the expiration of a tenancy, and by payment of rent, in either case the question was whether the rent was paid with reference to a yearly holding, and that where the payment was a weekly one the tenancy ought not to be held to be from year to year. In Rowston v Sydney County Council (1954) 92 CLR 605 at 616, the Full High Court, in what would seem to be a mere dictum, said:
As between the claimant council and the defendant appellant the rent has always been payable as a weekly sum not apparently referable to a year. If no more appeared it would be impossible at common law to regard the tenancy as one from year to year . . . . But it must be borne in mind that the rent reserved by the reddendum in the lease was expressed as a yearly rent of £443 and so in proportion for any less period than a year payable by weekly payments of £8 10s 5d to be made in advance. If the £8 10s 5d is considered as nothing but an instalment of a rent calculated as a yearly rent then the inference would at least be open, if not inevitable, that a tenancy from year to year was implied between the claimant council and the defendant. It is to be noted that E8 10s 5d a week is not a true instalment of the rent of £443. A rent at the rate of £8 10s 5d a week calculated for 365 days would give a yearly rent of £444 6s. That perhaps is not a very important consideration.
The South Australian Full Court has held that to make a tenant holding over and paying rent a tenant from year to year the original letting must have been for a year or an aliquot part of a year, or at a yearly rent; therefore, a letting for a period of 18 months at a weekly rental, the tenant to pay rates and taxes, is not a letting from year to year, and where a tenant holds over beyond such period, and continues to pay rent as before, he is merely a weekly tenant: Solomon v Bray (1873) 8 SALR 128.
In other cases it has also been said that for a yearly tenancy to be presumed the rent must be paid by reference to a year or an aliquot part of a year. See Dennis & Copley v Eddie [1952] VLR 92 at 99 where Sholl J refers to the question whether there must be payment of rent by reference to a year or an aliquot part of a year without expressing any opinion upon it. Such cases occur where a tenant over holds…. In such cases payment or acknowledgement of rent constitutes evidence of the establishment of a tenancy, and the fact that the rent is paid by reference to a year, or aliquot part of a year, affords evidence of a tenancy from year to year: Moore v Dimond [1930] ALR 341; 43 CLR 105 at 114 per Knox CJ, Rich and Dixon JJ. Similarly, in Re Weigall & Dawes' Lease [1942] VLR 49, a case of a lease for three years at an annual rent payable monthly, O'Bryan J said, at 54, that the obligation imposed by a covenant in the lease did not rebut "the inference which would otherwise be drawn from mere continuance in possession and payment of rent by reference to an aliquot part of a year, viz, that the tenancy intended was one from year to year. . .".
In Beattie v Fine [1925] VLR 363, Cussen J said at 374
After a consideration of all these cases it is sufficient lot me to say that where a tenancy extends over one year or a number of years, the agreement providing that the rent shall be payable in relation to some period which (though there is no word like "year" or "annual" used directly in connexion with the rent) is in fact an aliquot part of a year — eg, monthly or quarterly — and, the tenancy having expired, the tenant holds over with the consent of the landlord, and rent is paid and received in respect of such periods, the implication of law is, unless there is something to rebut it, that the tenant holds over as a tenant from year to year…. I might be justified in stating the rule in wider terms, such as those used in some of the cases, but this is enough here.
This judgment was referred to by Kitto J in Turner v York Motors Ply Ltd [1951] ALR 1054; 85 CLR 55 at 93. In the same case Dixon CJ said at (CLR) 66:
There is little resemblance between such a case and the very many instances in which a person has been let into, or has retained, possession of land without any express contact, and the question is whether he is a tenant, and if so, for a term of what duration. Such cases occur when a tenant overholds; when a tenant for life has granted a lease in excess of his power and dies before its determination, and the remainderman allows the lessee to retain possession; when a mortgagor has granted a lease without statutory or other power; and when the terms of entry are too vague or uncertain to be ascertainable. In such cases payment or acknowledgment of rent constitutes evidence of the establishment of a tenancy, and the fact that the rent is paid by reference to a year, or aliquot part of a year, affords evidence of a tenancy from year to year. The existence and duration of the tenancy in such a case were, however, questions of fact.
Webb J at (CLR) 86 referred to the creation of a tenancy from year to year where a tenant held over and paid rent: see further Permanent Custodian Trustees v Payne [1964] NSWR 1098; Queensland Television Ltd v Federal Commissioner of Taxation (1969) 1 ATR 419; 119 CLR 167 at 175. If a yearly tenancy will be implied only where rent is paid by reference to a year or an aliquot part of a year, then, since a week is not an aliquot part of a year (Dennis & Copley v Eddie [1952] VLR 92 at 99), there will be no presumption of a tenancy from year to year where a lessee holds over and continues to pay rent after the expiration of a lease reserving a weekly rent. In Edwards v Horrigan; Ex parte Horrigan [1923] St R Qd 8, the tenant held over after the expiration of a void lease for five years at the rent of 18s per week. It was held by the Full Court of Queensland that, though a tenancy from year to year could arise by implication of law only in cases where the rent was payable with reference to a yearly tenancy, yet in the instant case the rent was clearly payable with reference to such a tenancy because the agreement provided clearly that the weekly rent was to be payable throughout the five years.
The Victorian Full Court has twice dealt with the question. In Bank of Victoria v M'Hutchison (1881) 7 VLR (L) 452, there was a lease for one year at a rent of 30s per week. The tenant held over after the expiration of the term at a weekly rent, which was raised to 40s shortly after the expiration of a second year. The court held, rejecting the argument that the rent must be payable for periods referable to a year or an aliquot part of a year, that the justices were at liberty to infer a tenancy from year to year. Five years later the Full Court held, following Bank of Victoria v M'Hutchison, that if, after the expiration of a tenancy for a year certain at a weekly rent, the tenant is allowed to remain in possession, still paying the same rent, the presumption is that the continuing tenancy is a yearly one: Box v Attfield (1886) 12 VLR 574. It may be noted that in Moore v Dimond I 19301 ALR 341; 43 CIA 105, Isaacs J at (CLR) 122, expressly approves Bank of Victoria v M'Hutehison and Box V Attfield, and Knox CJ, Rich and Dixon JJ at (CLR) 117, refer to the decisions with apparent approval. Note also, however, that a passage in the joint judgment, at (CLR) 114, suggests that the presumption of a yearly tenancy arises only where the rent is paid by reference to a year or an aliquot part of a year.
In Fitzgerald v Button (1890) 16 VLR 561, a tenant for life granted a lease for 21 years at a yearly rent payable weekly. Upon his death the representatives of the remainderman, not knowing the terms of the lease, and being refused inspection thereof, wrote to the tenant asking him to pay the rent weekly to them, and he continued thereafter to do so for a considerable time, until the representatives gave him a week's notice to quit. Holroyd J dismissed an action for the recovery of the premises, on the ground that, assuming the lease to have terminated upon the death of the tenant for life, the receipt of rent by the representatives had constituted a tenancy from year to year between them and the lessee. This decision was affirmed by the Full Court: (1891) 17 VLR 52. It should be noted that in this case the lease reserved a yearly rent of £234, payable by weekly payments of £4 10s. Accordingly, even on the view of the law taken by the Court of Appeal, a yearly tenancy might have been presumed; for in Adler v Blackman, it was recognised that, provided that an annual rent is reserved, the fact that the rent is payable weekly will not prevent the presumption of a yearly tenancy from arising. The case of Fitzgerald v Button is therefore of little assistance for present purposes although one observation made during the argument at first instance is of interest. Counsel for the defendant made the following submission:
Upon the death of the tenant for life that lease terminated, but the tenancy was allowed to continue upon the same terms precisely. It must therefore be presumed to be a tenancy from year to year, the fact of the rent being payable weekly not affecting the presumption: Bank of Victoria v M'Hutchison, followed Box v Attfield, which also shows that the same presumption applies where the lease was originally for an aliquot part of a year.
This moved Holroyd J to remark, "I do not think there is the slightest doubt f those two cases being correct": (1890) 16 VLR 561 at 563.
The decisions of the Full Court in Bank of Victoria v M'Hutchison and Box Attfield were cited to the Court of Appeal in Adler v Blackman [1952] 2 All -1_,R 41; [1953] 1 QB 146 at 148. The Court of Appeal did not find it necessary consider its decision, and, indeed, did not even call upon counsel for the respondent. The result is that there is conflict between two decisions of the Full: ourt and a later decision of the Court of Appeal. This conflict was referred to Adam J in Marshall v Burman (No 2) [1961] VR 161 at 166-7, his honour finding it unnecessary to choose between the two lines of authority. 17 or a discussion of the current status in Australia of decisions of the English and other) courts, see (1987) 61 ALJ 263.
No presumption in absence of necessary intention
[2.12] In a case to which the restrictions of landlord and tenant rent control legislation, such as those imposed by Pt V of the Landlord and Tenant Act 1958 (Vic) apply, if a landlord takes no steps to oust his tenant at the expiration of the term, but merely leaves him in possession and accepts rents after the expiration of the term, no inference is to be drawn against him that the intend to create a tenancy from year to year, for it cannot be said that the landlord has voluntarily abstained from turning the tenant out: Morrison v Jacobs [1945] 2 All ER 430; Bowden v Rallison [1948] 1 All ER 841 at 843; Christopher v Wright [1949] VLR 145; Hamilton v Porta [1958] VR 247; Arnold v Mann [1957] ALR 1207; 99 CLR 462. These decisions apply where no more appears than that the lessor might or might not have left the lessee in possession, not because he intended to create a tenancy from year to year, but because his rights were restricted by the Act; the decisions have no application where it appears that the lessor's reason for leaving the lessee in possession was not the existence of the statutory restrictions on eviction: Dennis & Copley v Eddie [1952] VLR 92 at 100; see also [2.04].
Periodic tenancy for less than a year
[2.13] The tenancy from year to year, which is one example of a periodic tenancy, has been dealt with in [2.07]42.11]. Periodic tenancies are tenancies having a recurring period; they are tenancies for a series of indefinite periodic terms, and continue indefinitely until they are determined: Bootes v Staples & Co [19,16] GLR 530; Commonwealth Life (Amalgamated) Assurance Ltd v Anderson (1945) 46 SR (NSW) 47; Fink v McIntosh [1946] VLR 290 at 292; see also [2.07]. Subject to express agreement, a periodic tenancy does not determine upon the tenant's death: Youngmin v Heath [1974] 1 All ER 461. The periodic tenancies for less than a year which are commonly found are tenancies from quarter to quarter, tenancies from month to month and tenancies from week to week. A fortnightly tenancy may be created (Munro v Dare [1934] St R Qd 332; Foenander v Dabscheck [1954] VLR 38), as may a daily tenancy (Butcher v Bowen [1964] NSWR 36; 80 WN (NSW) 1520) and a half yearly tenancy (Re Midland Railway Co’s Agreement [1970] 1 Ch 568, affirmed [1971] 2 WLR 625). Similarly, there may be a letting for successive periods of 364 days: Land Settlement Association v Carr [1944] 2 All ER 126; [1944] 1 KB 657. The parties may, it would seem, select any period they please. A monthly tenancy properly so called is a tenancy the recurring period of which is a calendar month, not a lunar month of 28 days: for example, the monthly periods might extend from the twenty-fifth day of one month to the twenty-fourth of the next month: Amad v Grant [1947] ALR 191; 74 CLR 327 at 348; Wiltshire v Dalton (1948) 65 WN (NSW) 54. A monthly tenancy in the accepted sense is not to be confused with a tenancy the recurring period of which is only 28 days. Such a tenancy may be described as a lunar monthly tenancy, or as a tenancy from four weeks to four weeks: Bootes v Staples & Co [1916] GLR 530, or as a four-weekly tenancy: Lemon v Lardeur [1946] 2 All ER 329; [1946] KB 613; Rae v Clifford [1893] NZLR 257. In the case of a weekly tenancy it will often be found that the tenant pays rent every four weeks. Where a weekly rent is reserved, and the rent is by express or implied agreement payable every four weeks, the tenancy may be a mere weekly tenancy, or a weekly tenancy determinable by four weeks' notice, or a lunar monthly tenancy. The distinction between a weekly tenancy determinable by four weeks' notice and a lunar monthly tenancy is a somewhat fine one. A weekly tenant who pays rent monthly in advance is entitled to a month's notice: Cohen v Milner [1960] VR 499 at 503.
Tenancy at will
[2.15] A tenancy at will, though called a tenancy, is unlike any other tenancy except a tenancy at sufferance, to which it is next-of-kin. The tenancy is terminable at the will of either party: Binions v Evans [1972] Ch 359. It has properly been described as a personal relation between the landlord and his tenant; it is determined by the death of either of them or by any one of a variety of acts, even by an involuntary alienation, which would not affect the subsistence of any other tenancy. It is true that in some cases the relation of tenant at will may be expressly created by contract (Manfield & Sons Ltd v Botchin [1970] 3 All ER 143; [1970] 2 QB 612) but that is an exceptional case, and usually the tenancy at will is founded on an implied contract: Wheeler v Mercer [1956] 3 All ER 631; [1957] AC 416 at 427. There are very many decisions on particular facts dealing with the question whether a tenancy at will has been created by implied agreement. In practice it is at times necessary to make a choice between five possible relations. The relationship may be that only of licensor and licensee or there may have been created a tenancy at sufferance, a tenancy at will, one of the lesser periodic tenancies or a tenancy from year to year. The choice is often not an easy one. The fact that the rent was reserved at an annual rate was held to override the expressed intention of the parties to create a tenancy at will in Manfield v Botch/n. Whether in modern times the tenancy at will has suffered a change in its purpose and function was considered in Heslop v Burns [1974] 1 WLR 1241