LEGAL IMPLICATION OF A LEASE OVER A LICENSE

Background

A lease is defined under Section 3 of the Registered Land Act as a grant without consideration by the proprietor of land to exclusive possession of that land. A lease may also be defined as a contract by which the one party, while reserving a reversion to himself confers upon the other the right to the exclusive possession of real property for a limited time. There are various classifications of leases, which include: A lease for a fixed period, Periodic tenancies, Tenancy at Will Tenancy at Sufferance, Lease in Possession: Reversionary (or future) lease. A lease may be terminated by expiry or effluxion of time, by notice -i.e. notice to quit, by forfeiture, by surrender - may be express or implied, by merger, or by frustration.

A license on the other hand is defined as permission granted by the proprietor of land, which allows the licensee to do some act in relation to the land which would otherwise be a trespass. Thou licenses may assume various forms and perform a multiplicity of purposes, the law has in the past recognised the following four categories of licenses: the bare license, the license coupled with the grant of an interest, the contractual license and the license based on proprietary estoppel. A license may be revoked with or without notice thou most contractual licenses require for a notice to be issued the rest of the categories of licenses may be revoked without giving notice. 

License And Lease Distinguished.

The following distinctions can thus be drawn be drawn between a lease and license. Whereas a lease creates an estate or proprietary interest in land, a license creates only a personal permission to be on land.  A license only makes an action that would otherwise be unlawful to be lawful, this distinction is important in relation to protected tenancies and also inheritance. Concerning protected tenancies, the Rent Restriction Act (Cap 296) and the Landlord and Tenant (Shops Hotels and Catering Establishments Act (Cap 301) only give protection to a tenant and not a licensee. Concerning inheritance, a lease, can be inherited, assigned or sub-let. A licence on the other hand, is a mere personal privilege of occupation and therefore it cannot be the subject of inheritance or assignment.

We invite your enquiries and or consultation on leases and transfer of property in Kenya, generally. You may call us on +254 715 310 677/+254 773 865 798 or you may email us at info@stralexgroup.co.ke.

Yours faithfully,

FOR: STRATEGIC LEGAL SOLUTIONS GROUP LIMITED

Centre for Legal Research & Policy Development - a participating consultancy in the SLS Group of consultancies