Definition of a lease

A lease is a legal estate.
Legal estate is defined under s2 of CPO as "a term of years absolute in land"
"A term of years absolute in land" is defined under s2 of CPO as including "a term for less than a year, for a year or years and a fraction of a year and from year to year."

Key words in the definition: 1) Term 2) Of years 3) Absolute

1) What is a "term"?

• The lease must be a definite period instead of indefinite.
• Commencement date of the lease must be certain (One Queen v Chan Siu Lan)
• The maximum duration of the lease must be certain at the date of commencement. (Lace v Chantler)
• (What if duration of lease is not certain but maximum duration is?)

2) What is "of years"?

A lease can be for ANY fixed duration, let it be 999 years or 99 days.
(Can a lease be e.g. every other day for half a year)

3) What is "absolute" ?

A literal interpretation of absolute means that the term of years must not be determinable on any condition. However, since this term is taken from England and aligning with the legislative intention, absolute must also mean a term of years liable to determination by notice, re-entry, operation of law...

4) Application of "term" in different types of lease

• Perpetually renewable lease: A lease which gives the tenant a right to renew the lease at the end of the term on identical terms and conditions. Not likely to be effective unless there are express words to that effect. (Marjorie v Barclay)

• Periodic tenancy: Rule of certainty of term in Lace v Chantler is also applicable (Prudential v London)

Glossary

• Interesse termini: A tenant have no legal estate until he commits the entry. Before that, he merely has the right to take possession in contract.

• Reversionary lease: A lease commencing at a future date.