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Section 33.

1
The Rental Agreement

Section
33.1 The Rental
Renting
a
Place
Agreement
Chapter
33

to Live

Section 33.1
The Rental Agreement
Section 33.2
Responsibilities of Landlord and Tenant

Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement


What Youll Learn
How to define the main types of tenancies
available to persons who rent real
property (p. 712)
How to describe some of the common
covenants found in a lease (p. 714)
Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement


What Youll Learn
How to summarize rent control laws
(p. 718)

Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement


Why Its Important
Knowing all you can about rental
agreements and the types of tenancies will
help you choose a place to live and know
how to address disputes that may arise.

Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement


Legal Terms
lessee (p. 712)
lessor (p. 712)
tenancy (p. 712)
tenancy for years (p. 713)
periodic tenancy (p.713)

Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement


Legal Terms
rent day (p. 713)
tenancy at will (p. 714)
tenancy at sufferance (p. 714)
lease (p. 714)
sublease (p. 716)

Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement

Section Outline
Tenancy
Types of Tenancies
Tenancy for Years
Periodic Tenancy
Tenancy at Will
Tenancy at Sufferance

Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement

Section Outline
The Lease Agreement
Terms in a Lease

Rent Control

Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement

Pre-Learning Question
What is a tenant?

Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement

Tenancy
If you rent real property, such as an
apartment or house, you are a
tenant.
If you own real property and rent it
to someone else, you are a
landlord.
Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement

Tenancy
The contract between a tenant and a
landlord is called a lease.
In a lease, the tenant is known as the
lessee, and the landlord is the lessor.

Understanding Business and Personal Law

Renting a Place to Live

33.1 33.1
Section
The Rental Agreement

What to Look for


in Selecting an Apartment
Location
Near school, work
Near church, mosque,
synagogue
Near shopping
Near public
transportation
Near recreation: parks,
museums
Understanding Business and Personal Law

Renting a Place to Live

33.1 33.1
Section
The Rental Agreement

What to Look for


in Selecting an Apartment

Finances
Amount of monthly rent
Amount of security
deposit
Cost of utilities
Length of lease

Understanding Business and Personal Law

Renting a Place to Live

33.1 33.1
Section
The Rental Agreement

What to Look for


in Selecting an Apartment
Building
Condition of building and
grounds
Parking facilities
Recreation on premises
Security system
Condition of hallways,
stairs, and elevators
Access to mailboxes
Understanding Business and Personal Law

Renting a Place to Live

33.1 33.1
Section
The Rental Agreement

What to Look for


in Selecting an Apartment
Layout and Facilities

Size and condition of unit


Type and controls of heating
and cooling systems
Plumbing and water
pressure
Type and condition of
appliances
Condition of doors, locks,
windows, closets, and floors
Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement

Pre-Learning Question
What is a tenancy?

Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement

Types of Tenancies
Although they rent from someone
else, tenants own an interest in the
real estate they lease, called a
leasehold estate or tenancy.

Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement

Types of Tenancies
The types of tenancies are
tenancy for years
periodic tenancy
tenancy at will
tenancy at sufferance

Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement

Tenancy for Years


A tenancy for years is the right to
occupy property for a definite or fixed
period of time.
It may be for one week or 99 years, as
long as the time period is definite.
Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement

Periodic Tenancy
A periodic tenancy, also called a
tenancy from year to year (or month to
month, or week to week), is a tenancy
that continues for successive fixed
periods.

Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement

Periodic Tenancy
One of the parties may terminate this
tenancy by giving advance notice to
the other party.

Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement

Periodic Tenancy
The notice requirement differs from
state to state, but it is often the period
between rent days.
The rent day is the day on which the
rent is due.
Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement

Tenancy at Will
A tenancy at will is an interest in real
property that continues for an
indefinite period of time.
No written agreement is required to
create this tenancy.
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Section 33.1 The Rental Agreement

Tenancy at Will
It is terminated when either the
landlord or the tenant gives the notice
required by state laws, which is
usually 30 days.

Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement

Tenancy at Sufferance
A tenancy at sufferance arises when
a tenant doesnt leave the premises
after his or her tenancy has expired.

Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement

Tenancy at Sufferance
This situation often occurs when a
tenancy for years expires or when a
tenancy at will has been properly
terminated by the landlord but the
tenant remains in possession.

Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement

Jill Stunzi signed a lease to rent an


apartment for six months. What type
of tenancy has she agreed to?

Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement

ANSWER
Tenancy for years.

Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement

Jamal Youngston has an oral


agreement with Mary ODonnell to
rent her basement apartment until he
graduates from college. What type of
tenancy has he agreed to?
Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement

ANSWER
Tenancy at will.

Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement

Marcus Kennedy is a contract painter


and often works for weeks on end
away from home. During these times
he often rents a hotel room from week
to week. What type of tenancy is he
agreeing to?
Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement

ANSWER
Periodic tenancy.

Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement

Pre-Learning Question
What is a lease agreement?

Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement

The Lease Agreement


A written agreement between a lessor
and a lessee is called a lease. The
lease creates the landlord-tenant
relationship. It provides the tenant with
exclusive possession and control of
the real property of the landlord.
Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement

Terms in a Lease
The terms of a lease, known as
covenants, set forth the rights and
duties of the landlord and tenant.

Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement

Terms in a Lease
Common terms, or covenants, found
in a lease include
security deposit
decoration and repairs
assignment and subletting
option to renew or to purchase
Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement

Security Deposit
Landlords often require you to pay a
security deposit and the last months
rent at the beginning of a tenancy in
order to secure the payment of rent or
repairs for damages to the property.

Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement

Decoration and Repairs


The landlord has no obligation to
decorate the premises, unless the
lease says so or it is required by
statute or local ordinance.

Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement

Decoration and Repairs


However, the landlord must make any
repairs necessary to keep the
premises fit for living. This includes
repairs such as fixing a leaky roof or a
broken furnace.

Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement

Assignment and Subletting


An assignment of a lease occurs
when you transfer the remaining
period of time in a lease to someone
else.

Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement

Assignment and Subletting


A sublease occurs when you transfer
part of the term of lease, but not the
remainder of it, to someone else.

Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement

Assignment and Subletting


If a landlord doesnt want a tenant to
assign or sublet the property, a
covenant in the lease must say that.
Otherwise, a tenant may either assign
or sublet the property to someone
else.
Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement

Option to Renew or to Purchase


The option to renew the lease gives
renters the right to a new lease, under
the same terms, for an additional
period.

Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement

Option to Renew or to Purchase


The option to purchase the property is
an agreement by the lessor to sell the
property to the lessee for a stated
price.

Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement

Pre-Learning Question
What is rent control?

Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement

Rent Control
Some large communities have passed
rent control laws to keep rent within an
affordable range.

Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement

Rent Control
These laws limit what landlords can
charge for rental property and also
often contain procedures that must be
followed before tenants can be
evicted.

Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement


Section 33.1 Assessment

Reviewing What You Learned


1. What is the difference between a
tenancy for years, a periodic
tenancy, and a tenancy at will?

Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement


Section 33.1 Assessment

Reviewing What You Learned


Answer
A tenancy for years is for a fixed time
period. A periodic tenancy continues for
successive periods until one of the parities
ends it by giving proper notice.

Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement


Section 33.1 Assessment

Reviewing What You Learned


Answer
A tenancy at will is for an indefinite time
period and is often an oral agreement.

Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement


Section 33.1 Assessment

Reviewing What You Learned


2. Name the common covenants found
in a lease.

Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement


Section 33.1 Assessment

Reviewing What You Learned


Answer
Security deposit, decoration and repairs,
assignment and subletting, and option to
renew or to purchase.

Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement


Section 33.1 Assessment

Reviewing What You Learned


3. Explain rent control laws.

Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement


Section 33.1 Assessment

Reviewing What You Learned


Answer
Rent control laws exist to keep rents within
an affordable range. The laws limit the
amount of rent the landlords may charge
for rental property.

Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement


Section 33.1 Assessment

Reviewing What You Learned


Answer
They often contain procedures that must
be followed before tenants can be evicted.

Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement


Section 33.1 Assessment

Critical Thinking Activity


Leasing Terms
Imagine you are ready to rent a place to
live. Make a list of covenants you would
want in your lease, and explain why you
would want these covenants.

Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement


Section 33.1 Assessment

Critical Thinking Activity Answer


Leasing Terms
Answers will vary but should reflect an
understanding of the term covenant.

Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement


Section 33.1 Assessment

Legal Skills in Action

Maintaining the Premises


The grounds surrounding the apartment
complex where you live are full of trash.
The grass hasnt been mowed for weeks,
and it looks pretty shabby.

Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement


Section 33.1 Assessment

Legal Skills in Action

Maintaining the Premises


Youve mentioned the problem to the
landlord, but no action has been taken.
Write a petition to circulate among the
tenants to ask the landlord to hold a
meeting to discuss the difficulty.
Understanding Business and Personal Law

Renting a Place to Live

Section 33.1 The Rental Agreement


Section 33.1 Assessment

Legal Skills in Action Answer

Maintaining the Premises


Petitions will vary, but should include the
duties of the landlord in regards to the
grounds of the property.

Understanding Business and Personal Law

Renting a Place to Live

End of Section 33.1


The Rental Agreement

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