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Using a License Agreement Instead of a Lease

By Adam Leitman Bailey and John M. Desiderio

A number of years ago, I sat down with one of the New York’s real estate legends and his company’s general counsel. He was bothered by New York’s eviction process — the loss of rental income, the wasted legal fees, and the incredible amount of time between a tenant’s default and an actual eviction.

For a number of his buildings, he was unveiling a new type of office space for smaller tenants needing smaller spaces. Under his design, a tenant would have a designated office and share a copy machine, fax machine, kitchen, and conference rooms. The furniture, carpeting, phones, computer, and coffee would be supplied by the landlord. The spaces would be pre-constructed. The renter would only need to bring a pencil to be able to work. The general counsel asked about using a license agreement where it could change the locks or, in this case, turn off the key cards upon a renter’s default. Our firm’s mission was to draft an enforceable license agreement providing for self-help without having to resort to litigation. This article discusses the license agreement — its limitations and its powers. It also dissects and explains when and how to use a license agreement, and the ability to effectuate self-help properly.

THE LICENSE AGREEMENT

Landlord attorneys have either overlooked or been too cautious to suggest the use of license agreements to their clients. However, license agreements permit commercial property owners to eliminate the landlord-tenant relationship entirely and thus avoid those burdens often experienced in the legal framework of traditional landlord-tenant proceedings.

The legal relationship between the property owner-landlord and a tenant established by a lease is entirely distinct from the legal relationship established by a license between the property owner-licensor and a licensee.

As explained in Friedman On Leases, the distinction between a lease and a license is that:

A lease is a conveyance of exclusive possession of specific property… usually in consideration of the payment of rent, which vests an estate in the grantee, [while] a license, on the other hand, merely makes permissible acts on the land of another that would otherwise lack permission. A license is said to be revocable at the will of the licensor, [and] creates no estate.

Chief among the owner-licensor’s rights in a license relationship is the right to revoke the license “at will” and to use “self-help” to remove a defaulting licensee from the licensed premises without having to endure months or years of lengthy and frustrating litigation to regain possession of valuable real estate.

Self-help is not unavailable to landlords in New York who reserve the right to use it in their lease agreements. However, courts are generally hostile to a landlord’s use of self-help and will not approve its use if there is an ambiguity in the lease terms or if there is any factual question concerning whether or not the lease has expired. Moreover, under New York’s Real Property Actions and Proceeding Law (“RPAPL”) §853, if a tenant is ejected from real property by force or other unlawful means, the tenant may recover treble damages from the landlord and may also be restored to possession if ejected before the end of the lease term. Only when a court concludes that restoring the tenant to possession would be “futile,” because the landlord will prevail in a summary proceeding to eject the tenant, is the court unlikely to order restoration of the premises to the tenant.

In contrast, under a bona fide license agreement, the tenant-licensee owns no estate in the premises and has no right to possession. Common law principles apply, and the owner-licensor has the absolute right to use peaceable self-help — at any time — to remove a licensee from the licensed premises for any reason or no reason.

Nevertheless, the use of a license agreement, instead of a lease , will not entirely eliminate all possibility of litigation between the owner-licensor and the tenant-licensee. The question of whether or not the “self-help” used was peaceable (and therefore lawful) or forcible (and therefore unlawful) is always a possible subject of litigation. However, where a valid license agreement exists, the owner-licensor will not be required to re-admit the ousted licensee to the premises, even if the self-help used is found to have been forcible and not peaceable. In New York, the licensee’s sole remedy will lie in the treble damages provide by RPAPL §853 for forcible ejectment. In the interim, before any judgment by a court, the owner-licensor is free to re-license use of the premises to another licensee.

In these circumstances, depending on the nature of the damages provable by the former licensee, the owner-licensor may view what is only a possible, but not certain, treble damage judgment as a far less onerous cost of doing business than the total of all the expenses normally associated with landlord-tenant litigation. In addition, instead of losing income during the litigation over self-help, the owner will actually be realizing income from the payments received from the new licensee of the premises.

Of course, the owner-licensor should take every precaution to ensure that the self-help it employs is always accomplished in a “peaceable” manner and without any real possibility of it later being found to have been done “forcibly.” There are, in fact, several well-known “peaceable” self-help techniques that have been employed, by landlords and licensors alike, which have passed muster with the courts, and that should always be used to minimize any risk of a court finding of “forcible” ejectment.

LICENSING FACTORS

To obtain the benefit of a license agreement, the property owner must ensure that its agreement with the prospective user of the premises is indeed a license and not a lease. This is not necessarily an easy task to accomplish. Merely calling the agreement a “license” will not make it so. Whether an agreement is held to be a license and not a lease will depend on the presence or absence in the agreement of the three essential characteristics of a real estate license: 1) a clause allowing the licensor to revoke “at will”; 2) the retention by the licensor of absolute control over the premises; and 3) the licensor’s supplying to the licensee all of the essential services required for the licensee’s permitted use of the premises.

Courts have found licenses to be leases where any one or more of these characteristics is either missing from the agreement altogether or not sufficiently vested in the powers retained by the licensor. However, the less control given the licensee, the more likely the agreement is to be a license because a license offers no autonomy, but merely allows a party “to render services within an enterprise conducted on premises owned or operated by another, who has supervisory power over the method of rendition of the services.” Nevertheless, it has been held that the licensor’s retention of control over prices charged by the licensee, times of operation within the licensed space, and even the choice of the licensee’s employees, is no guarantee that the agreement will be held to be a license and not a lease, as such controls may be deemed “no more than would reasonably be demanded by a careful owner as against a lessee for [any] business.”

Therefore, careful drafting of appropriate license agreements will be required, and, for this purpose, there must be close cooperation between attorneys and their clients who wish to implement a license regime. Communication to the client of the risks, as well as the benefits, of utilizing a license regime will be essential. In addition, attorneys will need to give close attention to the objectives of the client and determine how much initial cost the client is willing to accept in order to provide the kind of “full service” agreement that will pass a court’s “license” test.

Owners will also have to make judgments about the commercial feasibility of obtaining licensees who are willing to accept license agreements with “at will” revocation clauses. Whether potential tenant-licensees are willing to sign such agreements may depend upon the type of premises that the owner is making available for licensed use, e.g., whether the licensed space is a warehouse, an office suite for multiple users, or simple storage space. To attract licensees concerned about making a substantial investment in space subject to a revocable license, owners may create new financing incentives or build into the agreement a mechanism to compensate a non-defaulting licensee for the remaining unamortized value of its investment at such time as the licensor invokes the “at will” clause of the agreement.

At present, real estate license agreements appear to be utilized primarily by owners of properties licensed to short-term users: office space, laundry rooms, certain types of storage spaces, and kiosks in shopping malls. It is clear that there is a market for such agreements. Whether there is a market for real estate license agreements for other types of occupancy may not be so apparent, but, given the need of landlords to be relieved of the onerous burdens and frustrations of traditional landlord-tenant litigation, such an agreement may be useful for the right business plan.

Tenant attorneys whose clients are in default of a bona fide license agreement will no longer be able to guarantee delaying a judgment of eviction for up to six months. If their licensee clients do not cure their default, the clients will be subject to peaceable self-help eviction from the licensed premises swiftly and without further ado. No longer will property owners eagerly waive income and past due monies owed in order to guarantee regaining possession of the premises on a date certain. The negotiating leverage will shift in favor of the owner-licensor who will be able either to require full payment from the defaulting licensee, if it wishes to avoid eviction, or to require peaceable possession of the premises with the full backing of the law. For frustrated landlords with the right set of facts and real estate using the latest computerized entrance systems, this is a revolution that is long overdue.

Learn more about how landlords will may start utilizing licenses rather than leases here

Adam-Leitman-Bailey-Using-a-License-Agreement-Instead-of-a-Lease-Articles.pdf

Adam Leitman Bailey
John M. Desiderio
Commercial Leasing Services
Real Estate Litigation
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What if there’s no written lease?

In our latest commercial property blog, the team looks at the various legal positions created when landlords allow a tenant to occupy a property without formal documentation, and the resulting consequences of not having a written lease.

We often get enquiries from landlords where they have allowed business tenants into occupation of their property without any formal documentation being entered into. There are a number of different types of legal interest that can exist in this scenario. These include:

Licence to occupy

A licence to occupy is a personal right for the occupier to use the property. It is simply permission for the licensee to do something on a licensor’s property, and does not create an estate in land. One of the key indications of a licence is that the licensee does not have the right to exclusive possession of the premises. For example, they may share the property with the landlord or another licensee. A licence can be brought to an end at any time, giving the licensor complete control.

Tenancy at will

A tenancy at will, unlike a licence, grants a tenant exclusive possession of a property. One of the key features of a tenancy at will is that it can be determined by either party at any time. A tenancy at will is usually used by parties in cases where a person is let into occupation until a new lease is negotiated and rent is paid or where a person is allowed to continue in possession of the premises until negotiations relating to a new lease take place. The important point to note is that if, for any reason, the negotiations fail and the occupier still remains in occupation, a periodic tenancy might potentially be imposed.

Periodic tenancy

A periodic tenancy might potentially be created by oral agreement between the parties or by implication, and the payment of rent. The period for which the tenancy may be determined by reference to when the rent is paid.

Unlike the other legal interests explained above, the issue with a periodic tenancy is that a landlord cannot terminate it without first serving a notice upon the tenant.

Further problems can be caused as a periodic tenancy cannot be contracted out from the security of tenure provisions contained within the Landlord and Tenant Act 1954. There is strict rules and procedure in place for terminating a tenancy protected by this Act. Briefly speaking, the landlord will need to serve a notice of between six and 12 months, be able to evidence specified grounds and possibly pay compensation to the tenant.

The other major problem for a landlord is that if the tenant has security of tenure, and none of the grounds for opposing a new lease apply, the tenant will be entitled to a new lease on similar terms. A landlord may not have complete control of the terms which they may wish to impose. If the parties cannot agree the terms (such as allowed use, alienation and payment of rent), then the terms may need to be determined by the court, taking control away from the landlord.

One of our previous blogs explains the difference between a period tenancy and a tenancy at will in more detail.

Fixed term leases

The parties can agree to a fixed term lease orally though is less common than a periodic tenancy. In these circumstances the lease would be protected under the 1954 Act, unless the contracting out procedure has been followed before the tenant went into occupation of the premises.

The lessons for landlords

To prevent an unintended tenancy from arising, it is important for landlords to clearly document the type of legal interest which is to be created. Where a tenant will be in occupation for a short period of time, then landlords are advised to enter into either a written licence to occupy or a tenancy at will as these have the advantage of allowing a landlord to end quickly without grounds.

On the other hand, if the tenant is intending to occupy the premises for a longer period and the landlord wants to secure this future letting, then landlords should consider entering into a written lease for a fixed period in order to clearly document the terms under which occupation is to be granted.

To avoid the tenant obtaining security of tenure, a landlord should ensure that the lease is contracted out under the LTA 1954, or alternatively, allow the tenant to occupy under a licence or tenancy at will.

For more information on the law surrounding landlord and tenant issues, contact the team on 01772 258321 .

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When to use a Licence To Occupy or Tenancy Agreement

Posted by david cammack on october 28, 2022.

Home / Blog / When to use a Licence To Occupy or Tenancy Agreement

When to use a Licence To Occupy or a Tenancy Agreement image 1

Should you use a licence to occupy or tenancy agreement? We often encounter people either:

(a) referring to a licence to occupy residential property and a residential tenancy agreement interchangeably, or

(b) having difficulty in deciding which agreement to use.

However, they are actually two very different contracts. In this article we detail the differences and explain when to use one or the other. There are various factors to take into account when making this decision.

Exclusivity of use

With a licence to occupy, the licensee is granted permission to use all or part of the property on a non-exclusive basis. This means that the owner of the property is also allowed to use the property at the same time.

From a legal perspective, the licensee does not have any legal interest in the property; just permission to make use of all or part of the property, subject to any reservations in the licence agreement.

With a tenancy agreement, the landlord grants exclusivity of occupation to the tenant. This means that the landlord cannot use or access the property without the tenant’s consent, subject to common exclusions found in a tenancy agreement, such as:

the right to enter, with notice, to make regular inspections or
the right to enter for emergency repairs.

If it is intended that exclusivity to use the whole property be granted, then a tenancy agreement is the appropriate document to use.

If exclusivity of just part of a residential property is being granted (for example a bedroom in an HMO), then either a licence to occupy or a lodger agreement (if the landlord or a close member of the landlord’s family lives at the property and some key rooms are shared, e.g. bathroom, living room or kitchen) is more appropriate.

For more on this point, as a legal issue, read Wikipedia .

Length of term

It is common to use a licence to occupy:

for short-term arrangements (say, up to 12 months), or
where a fixed term is not acceptable, e.g. the owner gives permission to use and occupy the residential property on an ongoing monthly basis.

In such circumstances, the licence will state the amount of notice that either party must give to terminate the licence.

For longer-term arrangements (6 months plus), you might want to consider an assured shorthold tenancy agreement.

If a licence lasts for a long time, the Courts might decide at some point it became a tenancy . Then any eviction process is more involved and the occupant has all the statutory rights of a tenant.

When to use licence to occupy or tenancy agreement

A licence to occupy residential property is far more informal than a tenancy agreement. The licensee will not benefit from the statutory protections given to a tenant occupying property under a tenancy agreement. For example, a more-involved eviction process and deposit protection.

With a tenancy agreement, the landlord has a range of responsibilities implied into the contract by law, for example:

the requirement to allow the tenant ‘peaceful’ enjoyment of the property, and
certain maintenance obligations.

Often the owner of a property will use a licence to occupy when he has agreed to share the property with a third party, and perhaps when a long fixed term is not going to be acceptable.

If you want to grant a licence to occupy to a person that will share the property with you (as landlord) and you do not want the occupant to benefit from the statutory provisions that apply to a tenancy agreement, then we recommend using our Lodger Agreement Template .

If you will not occupy the property and do not want the occupant to benefit from the statutory provisions that apply to a tenancy agreement, then use our Licence To Occupy Residential Property Template if the licence seems a genuine fit with the facts of the occupation basis.

You can use either of these templates to grant a short fixed-term period or indefinite period, i.e. a month-to-month contract.

In any other situation, or if you want to grant a fixed-term contract that gives the other person the exclusive use of the property, then we recommend using our Assured Shorthold Tenancy Agreement Template . If in doubt, it is better to opt for the tenancy agreement.

We hope this helps you decide which type of agreement to use.

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Understanding the differences: Lease vs Licence to Occupy for real estate

A question which is regularly asked by property owners is “We have found a new tenant and need to get them in and trading as soon as possible. Can we grant a simple licence to occupy?”. As always in this wonderful world, the answer is “It depends...”!

A Licence to Occupy is viewed as a quick solution, but it can result in costly situations if the relationship between owners and occupiers breaks down, particularly when the owner needs to take back possession of the property and the occupier refuses to leave – what could have been viewed as a cost-effective and timely solution initially, may in fact result in lengthy and sometimes very expensive litigation. The key point here in determining who is in the stronger position legally is how the occupation has been documented (i.e. whether the document is interpreted as a lease or a licence). You cannot simply rely on what the document is called; the facts and nature of the occupation are key.

The main points to note when considering whether the occupation is under a Lease or a Licence are (a) whether the occupier has exclusivity i.e. can the occupier prevent the owner from entering the property (b) whether the arrangement is for a fixed term - an open-ended term leans more towards the arrangement being under a licence agreement and (c) who retains control over the property and are there any restrictions on how the occupier can use it (i.e. no alterations) and share it with other occupiers (i.e. perfume concessions on the ground floor of a department store).

What is a Lease?

A Lease is a legally binding contract that grants a tenant exclusive use of a property for a specified period of time, often 5 or 10 years. A Lease is typically more formal and provides the tenant with more rights and responsibilities. The terms of a Lease are fixed and cannot be changed unless both parties agree to a modification.

What is a Licence to Occupy?

A Licence on the other hand is a more informal arrangement that grants a tenant permission to use a property for a specified period of time. Unlike a Lease, a Licence does not grant exclusive possession of the property and can be terminated by a landlord at any time. Licences are often used for short-term or temporary arrangements, such as renting a parking space or using a commercial space for a pop-up shop.

The differences between a Lease and a Licence to Occupy

One of the main differences between a Lease and a Licence is the level of control a tenant has over the property. With a Lease, the tenant has exclusive possession of the property and can generally use and alter it as they see fit, as long as it does not breach the terms of the Lease. With a Licence, the landlord retains greater control over the property and may place restrictions on how the occupier can use it.

Another key difference is the legal rights and protections afforded to the tenant. Tenants under a Lease typically have more rights, such as the right to renew the Lease, the right to quiet enjoyment of the property and protection from sudden rent increases or eviction without cause. Tenants under a Licence have fewer rights and protections, as the agreement is more informal and can be terminated more easily by the landlord.

In conclusion, while Leases and Licences both allow tenants to occupy a property for a specified period of time, there are significant differences in the level of control, rights, and protections afforded to the tenants under each agreement. It is important for landlords and tenants to understand these distinctions in order to make informed decisions when entering into a rental agreement.

Boyes Turner is one of the UK’s leading full service law firms. Based in the Thames Valley, our work and client base rivals leading City and other national firms. The firm is ranked by leading legal directory guides Chambers & Partners and The Legal 500 as one of the UK’s leading regional law firms and a “regional heavyweight.” In the commercial sphere, our lawyers regularly work with some of the world’s most exciting start-ups and largest multinationals with their employment, property, dispute resolution, business support and insolvency, immigration, debt recovery, corporate, commercial and technology needs, and we are recognised for our expertise across a range of sectors. Our private client lawyers are renowned for their dedication to securing rehabilitation and maximum compensation in personal injury , medical negligence and court of protection claims.

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Friday, December 13, 2019

What is the Difference Between a Commercial Lease and a License to Occupy Business Space?

When one party agrees to let another party use its business space, they must agree on the terms of use, the fee, the term and how the occupancy will come to an end. This is referred to as a license to occupy space, which is different from a commercial lease. A commercial lease is an agreement between a landlord/lessor and tenant/lessee to lease real property. The landlord-tenant relationship creates a leasehold interest. A license to occupy real property, on the other hand, is merely a privilege to use the real property and no property estate is created.

A license is generally revocable by either party upon notice, at will – with or without cause and is usually not assignable the way a lease can be assigned to another entity with the landlord’s consent. A license to occupy is generally a personal right of the party to the license. The tenant and landlord have a relationship governed by the terms of the lease, and all the rights and remedies available under landlord tenant laws (including the eviction laws), whereas the laws of contract govern a licensee and licensor.

Generally, a license is for a shorter term than a lease. The parties may prefer a license agreement for an event to be held in business space for a seasonal duration (such as a Halloween store or a Christmas shop) or as a “pop up store” (which is test run to see if the business location works). Also, in the retail context, a license for space in a larger department store is often called a “concession.” An example of a concession is a makeup counter in a retail outlet.

In the office context, a landlord may give a tenant a license to occupy space in the building while the tenant’s permanent leased space is being constructed/renovated, sometimes called “swing space.” Another example of a license of space is when a company licenses a conference room for an industry conference event to another business entity which event will may be occurring over only a few days. The parties do not need to enter into a full blown lease with long provisions for such a short duration.

Both the license and lease agreements will, among other things, list the parties, a description of the space to be occupied, with a floor plan exhibit if applicable, the term (commencement date to expiration date), the fee (called rent or license fee) and the insurance to be carried by both parties. Note: A license to use space for a one time event where food and drink will be served should include appropriate liquor coverage under the insurance coverage.

The Bottom Line

A license offers more flexibility for parties wishing to occupy space for shorter durations, with a simpler form of agreement. A lawyer can assist in reviewing whether a license or a lease is most appropriate in a given context.

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What is a business licence to occupy?

A business licence to occupy is a legal agreement for one party (a licensee) to use certain parts of a property owner's (the licensor's) land/building. A licence is used where the parties do not wish to create a formal lease agreement . This business licence to occupy is designed for use where the property which will be the subject of the licence is based in England and Wales. The licence is a business licence and therefore the property should be used by the licensee for a commercial purpose under the agreement.

What are the different types of business licences?

This business licence to occupy can be adjusted to suit the specific circumstances of the licensor and licensee. Examples where an agreement of this nature may be used include shopping centres with different kiosks or in office spaces where hot-desking takes place. Specific licences are available for:

parking space agreements
storage agreements

What is the difference between a business lease and a business licence to occupy?

A licence is an agreement that permits a person or legal entity to do something. A licence to occupy therefore permits a business to occupy a space or part of a property but does not grant a legal interest in the property .

A business tenant will enjoy exclusive occupation of the relevant property. A business licensee will only have the right to use a space or room as may be specified from time-to-time, and the licensor will retain the right to occupy that space at all times . A business licence to occupy will usually only last for a short period (commonly 6 months). A business tenant will have particular rights and obligations under a tenancy agreement including, in most circumstances, a right to renew the lease.

Is it mandatory to have a business licence to occupy?

No. It is possible to grant a business the authority to use a space in a building informally (verbally) . However, it is helpful to have a written agreement so that each party is certain of the terms of the agreement.

What is a 'licence to occupy'?

A licence is an agreement that permits a person to do something. A licence to occupy therefore gives permission for a person or entity to occupy a space or part of a property . A licence is different to a tenancy agreement , which creates a legal interest in the property and provides a tenant with particular rights .

What should not be included in a licence to occupy?

The licensee should not be granted exclusive possession over the whole of the licensor's property. The licence agreement will specifically state that the licensor may change the defined area which the licensor may use, in order to address this. That is because exclusive possession is a key feature of a tenancy agreement .

What are the prerequisites for a business licence to occupy?

Before a licensor grants a license to occupy, they should:

check the terms of their insurance – to ensure that renting the space does not impact this
ensure that they have the legal authority to enter into the agreement - i.e. they own or have the appropriate legal interest/permission to let the property
check whether they need permission from their mortgage lender (if applicable)

Who can enter into a business licence to occupy?

The licensor may be a natural person, in which case they should:

be over 18 and
have full capacity , meaning that they are of sound mind and sufficiently understand the terms of the agreement

The licensor can also be a corporate entity (such as a company or a LLP).

The lincensee must be a business – whether a sole trader or a corporate entity.

Who cannot enter into a business licence to occupy?

A residential tenant or residential lodger should not use a business licence to occupy.

What can be the duration of a business licence to occupy?

A business licensee will usually only last for a short period . Commonly this will be a period of 6 months. The agreement will also make a provision for the parties to terminate the licence early, upon written notice .

What has to be done once the business licence to occupy is ready?

Each party should retain a copy containing the signature of each party. There is no requirement for the agreement to be witnessed or notarised . It is also not necessary to register the document once it has been signed.

The agreement is not reviewed by a lawyer to ensure that the legal content applies to the personal situation of the parties. In order to review the particulars of the agreement, it will be necessary to instruct a lawyer. For this type of agreement, it will be necessary to consult with a lawyer who is regulated by an approved regulator in the legal services sector . It is possible to search for a lawyer using the Law Society find a solicitor page in England and Wales .

Which documents should be attached to the business licence to occupy?

The following documents may be attached to a business licence to occupy:

a plan of the licensor's property/land - this should be attached to the licence to occupy at Schedule 1. The licensor may already have a plan available. Alternatively, if the licensor needs to obtain a plan, HM Land Registry office provides general information about the features which may be included in property plans. Many local government websites also provide general information about property plans.
a schedule of condition - this is used to record the condition of a property at a particular date . It will show the agreement that the parties have reached about the state and condition of the property at the time of entering into an agreement. It usually will include a description of any defects and may also include photographs.

It is possible to read more about what a schedule of condition involves on the government website .

What happens if the licence agreement is not adhered to?

If one party breaches the terms of an agreement the other party may wish to:

send a formal warning to the other party
terminate the agreement
consider taking steps to issue court proceedings

What should a business licence to occupy contain?

The business licence to occupy should:

define the parties – the licensor and the licensee
define the term of the agreement – how long it will last for
include a term granting a licence to occupy – this will grant permission for the relevant party (the licensee) to use the relevant parts of the property
include the terms of occupation - this will define the space/area which may be used under the agreement and whether there are any specific hours of use
define the payment terms - this will explain how much money the relevant party must pay to use the space/area and how frequently the payment must be made
define any particular rights and responsibilities of each party – this will include information about security and safety
include a notice period – this will explain how much notice each party must provide to bring the agreement to an end

What laws apply to a business licence to occupy?

Some of the key provisions which are relevant in determining the distinctions between leases and licences are:

The Law of Property Act 1925
The Landlord and Tenant Act 1954
The case of Street v Mountford [1985] UKHL 4

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Home / Property & Leases / Property Licences / Licence to Occupy Offices Agreement Template

Licence to Occupy Offices Agreement Template (P101)

What is this licence to occupy offices for.

This licence is a relatively flexible, short term agreement of less than six months to occupy offices – or other business premises. The licensee does not have a right of exclusive occupation and does not get the same protection as a tenant of business premises under English law.

What are the main issues?

A licence differs from a lease or tenancy agreement.

A tenant of business premises usually has some protection from being evicted when their lease comes to an end. Under Part 2 of the Landlord & Tenant Act 1954 a tenant usually has the right to negotiate a new agreement, unless the tenant agreed to exclude their rights at the time the agreement was signed.

With a licence, by contrast, you have no right to renew a licence once the landlord (or licensor) asks you to leave.

And a licence to occupy offices or other business premises differs from a tenancy in other ways: the licensee does not have the right to exclusive possession of the premises and the licensor can give notice to terminate at any time.

Also, be careful to get the wording right. So, when the legal effect of the terms of an agreement is to create the rights and obligations of a tenancy, then a tenancy is created even though an agreement is called a ‘licence’.

If you want a business lease, we have a selection of templates on our business leases page

What detailed terms does the licence contain?

This document contains 6 clauses covering

definitions and interpretation
the licence
licensee’s undertakings
power of licensor to affix notice boards
power to determine licence
a general clause detailing assignment, warranty, legal costs, notices and the contracts (rights of third parties) act 1999

You need this document if you are a landlord looking to offer a short-term occupation of your business premises to a licensee.

For more information, see our Explanatory Notes which you will receive when you download the document from our website.

When I download the document, can I change it and/or use it more than once?

Yes, all ContractStore’s templates are in MS Word and you can use the document on more than one project. For more information, watch the video on this page of our website or see our FAQs

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ContractStore supplies templates and is not a law firm. But all our templates are written by experienced lawyers so we can arrange legal assistance for customers who need special terms in one of our documents or a bespoke template. . For more information see our Legal Services page .

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You may also find these contracts of use:

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Licence to occupy.

A licence to occupy is a common arrangement used to regulate a party’s occupation in a property. It can serve as a useful tool for property owners and businesses alike, but only when fully understood and used in appropriate circumstances.

Licences to occupy are commonly used in the follow circumstances:

Serviced office space on a short-term basis
Between a buyer and a seller of the property in the period between exchange and completion
Prior to the grant of a lease when the parties are negotiating the terms of the lease, but the tenant requires early access to the premises
Department store concession arrangements

If you're looking to enter into, or grant a licence to occupy, we recommend consulting one of our commercial property solicitors to ensure your interests are protected and you're not exposed to unnecessary financial risks.

Here we’ll consider:

What is a licence to occupy.

A licence is a personal right or permission for a party to use, or ‘occupy’, a property. More specifically, a licence to ‘occupy’ is essentially permission for one party to do something on another party’s property. It is, by its very definition, not a lease. The owner of the property is usually referred to as the ‘licensor’, and the party granted permission to use the property, referred to as the ‘licensee’.

The key features of a licence to occupy are:

agreements that do not benefit from security of tenure (meaning there is no statutory right for the licensor to remain in the property once the licence has come to an end);
rent is not controlled under statute;
rights of occupation are personal and cannot be passed on to any other party;
generally short-term arrangements (although not absolutely necessary); and
do not give the licensor exclusive use of the area in question.

How long can a licence to occupy be?

Generally, licences to occupy are short-term in nature. They can be used as a stopgap for businesses who need a short-term solution whilst they look for longer term premises arrangements. Alternatively, they are also used to allow a party to start occupying a premises whilst the terms of a formal lease are being negotiated and agreed.

However, a licence is a contractual arrangement between two parties and, technically, it can be for whatever length the parties agree.

What’s the difference between a lease and a licence to occupy?

Just because a document is labelled a licence, it doesn’t make it so. Case law has concluded that even if a document calls itself a licence, if it has the characteristics of a lease then it will be deemed to be a lease.

The key determining factor as to whether an arrangement is a lease, or a licence, is whether the party occupying a premises has a right of ‘exclusive use’ of that premises. Essentially, if the party occupying the premises can lock out the owner of the premises then it will generally be deemed to be a lease, rather than a licence.

Parties should be aware, therefore, that although they may intend to enter into a licence to occupy, such arrangements carry an inherent risk of being deemed a lease. The reality of the arrangement is important.

A licence to occupy can be a useful arrangement for a property owner where flexibility is required or where the property has multiple users. This may also suit a licensee, if the commercial terms meet its requirements and are reflective of the rights granted.

A prospective licensee should, however, be under no illusion that their use of the intended property is always dependent on the licensor’s continued permission, which could be withdrawn on short notice. This should be taken into account when considering investments, which depend upon the continued occupation or would be diminished if terminated. Such occupation, under a licence to occupy, is unsecure and precarious.

Understanding the difference between a lease and a licence to occupy is important because a tenant occupying premises for the purpose of its business generally has certain statutory rights, including specifically the right to remain in the premises and renew its tenancy at the end of the term. This provides the tenant with what is known as ‘security of tenure’. The landlord only has a right to object to such a renewal on very limited grounds.

If a landlord expects to be granting a licence, but in fact grants a lease with security of tenure, this could have significant consequences for its ability to use the property for its intended purposes in the future. A licence, if drawn up correctly, should avoid this risk.

As noted above, occasionally, a licence to occupy will be granted in the period between exchange and completion of an agreement for lease. Even though, ultimately, the tenant intends to complete a lease, the landlord should remain mindful of the risk of security of tenure arising (if the intention is for it to be excluded). In this scenario, the landlord’s solicitor will need to ensure that, before the agreement for lease is exchanged (and access to the premises is granted) the necessary notices will need to be served to exclude security of tenure.

What are the benefits of using a licence to occupy?

A licence is quicker to arrange and can offer greater flexibility than a lease.
The licensor can occupy the property at the same time as the licensee and can grant additional licences to other businesses.
A licence is useful when there is no defined space e.g. in co working spaces or a concession stand.
A licence to occupy can be granted in the period between the exchange and the completion of a lease to allow the tenant access to carry out surveys, commence fit out works etc.
The circumstances in which a party can terminate a licence to occupy will be set out in the licence, this may offer more security than a tenancy at will which can be determined at any time without notice by either party.
A licence to occupy (provided that it is in fact and not a lease) will not grant security of tenure rights to the licensee.
There is not SDLT or LTT payable for the licensee (unless the licence to occupy is granted pursuant to an agreement for lease and that occupation amounts to substantial performance of the agreement for lease.

What are the disadvantages of using a licence to occupy?

Despite the contractual arrangement being labelled or called a licence, if exclusive possession is granted, the licensee could in fact claim that the licence is really a lease which is protected by the security of tenure provisions afforded to business tenants by the Landlord and Tenant Act 1954.
A licence offers no security, it is a personal contractual permission to occupy a property. If the Licensor disposes of its interest in the property, the licence to occupy will cease.

What should you look out for in your licence to occupy?

What you should look out for depends on whether you are the property owner or potential user.

Property owners who wish to avoid granting security of tenure rights within the ambit of the Landlord and Tenant Act 1954 should look out for provisions:

granting exclusive possession. Generally, a tenancy is created where there is exclusive possession;
providing for a fixed term; or
reserving a licence fee

These conditions may suggest that it is not in fact a ‘licence to occupy’, but instead a lease.

Licensees should check:

they can terminate the licence in line with their expectations;
they have rights to use all those parts of the property which they require and for their required purpose.

Can a tenant grant a licence to occupy?

A tenant may be able to grant a licence to occupy. Whether a tenant can grant a licence to occupy is dependent upon the terms of their lease. Tenants should be aware, however, that a lease is likely to expressly prohibit any shared use of the property. Alternatively, it may be permitted, but only with the express written consent of the landlord. Conditions may be attached to such consent.

Instead of a licence to occupy, a tenant may be able to grant a sub-lease, also known as an underlease. For more information on this see our article on subletting a commercial lease .

How long can a licence to occupy last?

Generally, licences to occupy are short-term in nature. They can be used as a stopgap for businesses who need a short-term solution whilst they look for longer term property arrangements. Alternatively, they are also used to allow a party to start occupying a property whilst the terms of a formal lease are being negotiated and agreed.

Terminating a licence to occupy

There is no set formula to document the giving of notice to terminate or recording that the licence has ended. However, a well drafted licence should set out the steps required to be taken in order to terminate and these steps should be strictly followed. Ordinarily, a simple letter giving notice (and preferably acknowledged by the recipient) would be sufficient to terminate a licence to occupy. It is, however, always sensible prior to terminating to obtain specific legal advice, as the terminating party (particularly if this is the property owner) will need to ensure comply with any specific terms of the agreement and be comfortable that a tenancy arrangement has not been created.

Where a tenancy has indeed been created (perhaps because exclusive possession was indivertibly granted) if the landlord has not taken steps to exclude security of tenure provisions then the landlord will only be able to terminate if one of the limited statutory grounds arises.

Deposit protection and licence to occupy

There is no requirement for any deposit paid to be paid into any deposit protection scheme or otherwise secured. For this reason, a licensee should be cautious in respect of a request for a large deposit – it may face difficulties if dealing with an unscrupulous property owner or one facing financial difficulties.

Costs associated with a licence to occupy

Ordinarily costs associated a licence to occupy are lower than those expected for a lease. Generally, a licence to occupy will be a shorter and more straightforward document that does not require the same level of formalities (such as pre-contract searches or registration at the Land Registry). This does, however, very much depend upon the terms to be agreed, the reasonableness of the parties and the existence of any complexities. It will also be down to negotiation as to who bears the cost of the preparation and completion of the licence – sometimes the licensor will insist that their legal fees are paid, but in the current market it is more common that each party bears their own costs.

With proper legal advice a licence to occupy can be a useful tool to document short term occupancy arrangements. They should however be used with extreme caution by property owners to ensure that they have not inadvertently granted a lease with security of tenure protection. A commercial property solicitor can help to ensure that your property interests are adequately protected.

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Licence to Occupy

Posted on August 24, 2021

If you are living in a property without a tenancy agreement you may think that you have no rights. That isn’t necessarily the case. You may have a licence to occupy. In this article our landlord and tenant solicitors look at what a licence to occupy is.

Online and London based landlord and tenant solicitors

If you need legal advice about a licence to occupy or your tenancy agreement the landlord and tenant team at OTS Solicitors can help you. Call OTS Solicitors on 0203 959 9123 or complete our online enquiry form for an appointment.

What is a licence to occupy?

A licence to occupy is an agreement between a property owner and a person occupying their premises that the person can enter and occupy their property. A licence to occupy is distinct and different to a tenancy agreement.

A licence to occupy doesn’t give you the same rights as a tenancy agreement. However, a licence to occupy does provide the person occupying the property (referred to as a licensee) with non-exclusive possession of a property. The property owner is referred to as the licensor.

A licence to occupy doesn’t give the licensee a legal interest in the property. If you enter a property to live in it without either a license or a tenancy then you may be classed as a trespasser. It is therefore best to have a licence or tenancy agreement.

What is a contractual licence to occupy?

There are two different types of licence, namely:

A bare licence – you are given verbal permission to stay in a property. An easily understood example is staying overnight at a friend’s house or in a hostel.
A contractual licence - although you would think that a contractual licence must be put in writing that isn’t a legal requirement for a contractual licence. A contractual licence can be entered into verbally or in writing. For a contract to exist there has to be some consideration, for example, that you will pay money in return for a room or provide a service, such as help with property renovations or help with looking after an elderly relative of the property owner. If significant services are provided then the occupation could be referred to as service occupancy or a service licence.

Is a licence to occupy really a licence or a tenancy agreement?

In some situations, a property owner will try to call what is really a tenancy of a property a ‘’licence to occupy’’. For example, by saying that there is no exclusive occupation. Some property owners think that if they don’t offer exclusivity of use in the written document, the agreement will be viewed as a licence to occupy if there is a dispute and the dispute goes to court . That’s why it is best to get legal advice before entering an agreement over occupation of a property.

A landlord and tenant solicitor will look at the agreement and consider:

Is there an intention to enter into a legal relationship?
Is there a right to exclusive occupation?
Is there a service provided as part of the occupation agreement?

If the answer to all three questions is no then there may be a tenancy rather than a licence to occupy, but the answer isn’t straightforward. That’s because even if exclusive possession of a property is granted by the property owner the occupation could still amount to a licence to occupy if there is no intention to enter into a legal landlord and tenant relationship.

What does non-exclusive occupation mean?

With a licence, the occupier of a property or licensee gets non-exclusive occupation of the premises. That means the property owner or licensor can grant other licences or can occupy the property (or part of it) themselves.

A tenancy agreement means the tenant gets exclusive occupation of the property so the tenant can exclude other people from the rented property during the term of the tenancy agreement. This includes the exclusion of the landlord who, under a tenancy agreement, is only normally entitled to enter the property in emergencies or after giving reasonable notice to carry out inspections or property repairs.

What amounts to exclusive occupation is a question that has to be asked according to the circumstances. For example, if the property owner can tell you to move room in the house or can enter your room to change the bedding and clean or can introduce a new person to join the household and use the shared facilities, these are all indications of non-exclusive occupation.

Does a licence provide security of tenure?

A licence doesn’t provide the same security of tenure as a tenancy agreement. If you are offered a licence, it is best to get specialist legal advice on whether a licence to occupy will suit your needs.

If you are a tenant, rather than a licensee, you have some statutory rights. Accordingly, you have greater rights as a tenant rather than as a licensee under a licence to occupy.

Is a lodger a licensee?

If you are lodging in a property, or planning to do so, the likelihood is that you will be a licensee rather than a tenant.

Often lodgers aren’t given a lodger agreement or a licence to occupy agreement. However, it is best to have a written licence agreement so you know the basis of your occupation of the property.

How long does a licence to occupy last for?

A licence to occupy can be granted for a fixed period of time (normally a month, six months or a year) or be periodic (normally weekly or monthly).

The granting of a licence to occupy is normally more temporary in nature than a tenancy. Even if the licence to occupy is temporary it is important that the licence to occupy is put in writing and that notice periods are given.

For advice on licence and tenancy issues call the friendly and efficient landlord and tenant team at London based OTS Solicitors on 0203 959 9123 or complete the online enquiry form for a video call or telephone appointment.

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What is a license to occupy and why do you need one?

14 feb -->what is a license to occupy and why do you need one.

Often when you own property you will need someone else’s permission to do something. That permission is set out in a document called a licence .

If you are buying or selling a property, and your solicitor starts talking about needing a licence, what they mean is that you either need to give someone permission, or you need to get permission from someone else to do something. These are examples of the most common types of licence that you might come across.

A licence to assign –

This is where someone has a lease over property (residential or commercial) and they want to sell that lease to someone else (which is called assignment) and the person selling the lease needs the permission of the landlord. The lease is likely to set out the landlord’s criteria, particularly in commercial property where the landlord will have wide powers to say no. In real terms, the landlord wants to make sure that whoever is taking over the property is going to pay the rent on time and are going to be a good tenant.

The landlord might want to see financial records for the person you are selling to and might also ask for a reference from, for example, their previous landlord. If the landlord isn’t happy with the information they receive on the party that you want to transfer the lease to, you can challenge their decision if you can show they are being unreasonable. Alternatively, you could offer some form of security, such as giving a personal guarantee that the new tenant will pay their way.

Finally, you can look for a more acceptable party to take over the lease from you. If it’s residential property, the process tends to be more straight forward. So long as you are all up to date with your rent and service charges, your landlord is less likely to be concerned about who you are selling your flat to, but sometimes (particularly with older leases) there might be a requirement to provide a reference.

A licence to occupy –

This is more likely to relate to commercial properties, such as an office or shop. There are two ways in which commercial property is let. Either by a lease, or a licence. A licence gives you permission to occupy the property under certain conditions.

They are much less formal than a lease, and so can be done more quickly and cheaply. However, as the saying goes, you get what you pay for. If you have a licence, that means you have much less protection. With a licence, it’s much easier for the landlord to make you leave at the end of the licence period with no obligation for the landlord to serve you with any notice.

A licence to sublet –

If you have a lease over property, residential or commercial, you are likely to need your landlord’s permission before you can sublet it.

Unlike assignment, if you sublet you are still the tenant and so you are still responsible for making sure that the terms of the lease are abided by. For this reason, your landlord will have less concerns about who your sub tenant is, but that doesn’t mean they won’t have any concerns at all.

They will still want to make sure that you have a sub lease or tenancy agreement with them that will enable you to take action if the tenant is difficult, such as making too much noise or doing anything illegal. Some landlords will have a complete prohibition on subletting under any circumstances, so make sure you check out the lease carefully.

A licence to carry out alterations –

If you take a lease over commercial property, the lease is highly likely to say that you cannot make any changes to the property without the landlords’ permission. If you want to obtain their permission, you will need to tell them exactly what works you want to carry out.

This might include drawings and specifications from a surveyor. The licence will commit you to doing the works exactly in line with those drawings and specification. What’s more, you are likely to be required to take all of the alterations out at the end of the lease and put the property back in the condition that it was in at the start.

This is all done at your expense and if you don’t, your landlord can do it for you and charge you for the cost of doing so. You may feel that what you’ve done enhances the value of the property, but the landlord may feel that it restricts what they can do with the property after you’ve gone.

For example, if you’ve kitted it out as a great restaurant, it’s no good if the landlord’s next tenant is a clothing store.

So what happens if you should get a licence, but you don’t?

Well that depends on the attitude of the party that you should have obtained the licence from. It’s always possible that they won’t do anything, but that’s unusual. It’s more likely that they will force you to obtain a licence retrospectively, and that is likely to cost more than it would have done if you’d got the licence at the outset.

However, it’s also possible that your landlord could sue you for damages and costs and could even make you leave the property. So, for example, if you take a lease over commercial property and you make alterations to the property without permission, the landlord could make you put it back at your expense, and terminate your lease for breach of the provisions.

This could mean that you lose the property and you won’t get back any of the money you’ve spent on taking out the lease.

Or what happens if you take out a licence, but you don’t comply with it. For example, if you have a licence to sublet the property to person A, but you end up letting it to person B. This might be because person A was going to take the property, but then pulls out at the last minute, and you want to let to person B, but you don’t want to have to start the licence process again.

Or you might be tempted to put forward person A as the potential subtenant, because you think they will be more acceptable to the landlord than person B, who is the real subtenant. If the landlord finds out, they can take action against you for breach of lease. This could cost you a great deal of money and could even result in you having to leave the property without getting back any of the money you’ve spent so far.

What happens if you take over a property where the previous owners should have taken out a licence but didn’t, or had a licence but didn’t comply with it. Well, if the event that they did in breach of licence has come to an end (such as an illegal sub let which has finished) then it doesn’t affect you. However, if you take over a property where, for example, there is still an illegal sub let, you are liable in the same way that the previous owner would have been. You cannot plead ignorance just because you bought it like that.

The best advice we can give you is to make sure you get a licence if you are required to do so, and having got your licence, make sure you comply with it. If in doubt, ask your solicitor for clarification.

If you would like more information on any form of licenses, please contact Rebecca Purssord on 0800 799 9892 or email [email protected] .

Disclaimer – our articles are designed to give you guidance and information. There is no substitute for proper direct advice, particularly as everyone’s circumstances are different. If anything in this article may affect you, please contact us for advice that is specific to your circumstances.

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Insights // 24 October 2022

What is a Licence to Assign? A Summary

Partner katja wigham, in our commercial property team , explains what a licence to assign is..

A licence to assign is a landlord’s permission for a tenant (the assignor) in occupation under a lease to assign the lease to a new incoming tenant (the Assignee). It should be noted that this permission does not necessarily need to be in a formal deed. Therefore, landlords and agents should be mindful of falling into the trap of granting permission through correspondence, thereby inadvertently granting consent without the assignor and assignee having to comply with the required conditions such as providing a guarantee or rent deposit. In Aubergine Enterprises Ltd v Lakewood International Ltd (2002) it was held that consent to assignment was contained in correspondence even if was stated to be “subject to licence”.

Landlords are provided with some comfort in that if the lease contains a provision that consent must be given by deed, then this is the only way in which permission to assign can be granted. In this instance, the landlord, assignor and assignee (and guarantor if required) will be a party to the licence, which will usually be prepared in triplicate and a copy provided to each party on completion.

The licence will contain several covenants, for example a covenant between the Assignee and Landlord to observe and perform the covenants contained in the lease. The assignor may covenant to pay the landlord’s legal costs in connection with the licence and covenant not to allow the Assignee to take occupation of the premises until completion of the assignment.

Under Section 19(A) of the Landlord and Tenant Act 1927, the landlord should not unreasonably withhold consent to the assignment of the lease. If however, the lease contains provisions such as that the Assignor must not be in arrears and/or in breach of any covenants of the lease then the Landlord is entitled to withhold consent until these obligations have been complied with. The licence should incorporate a right of re-entry clause allowing the landlord to forfeit the lease owing to a tenant’s breach of covenants in the licence.

A landlord will often want the licence to include an indemnity clause whereby the assignor and the assignee will indemnify the landlord against all liabilities, losses, costs incurred and damages arising out of the licence. An assignor however is likely to want to limit the indemnity to reasonable costs and expenses, properly incurred and to their own breaches.

Finally, the permission under a licence to assign typically remains valid for three months following completion of the licence, during which time the assignor and assignee will assign the lease. If assignment does not take place within the specified time then the licence will cease to be valid and the assignor will have to start over again.

For further information or legal advice, please contact [email protected] or call 0118 951 6800.

This article is intended for the use of clients and other interested parties. The information contained in it is believed to be correct at the date of publication, but it is necessarily of a brief and general nature and should not be relied upon as a substitute for specific professional advice.

Katja Wigham

Partner, Commercial Property Law

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Licence to occupy – all you need to know

What is a licence to occupy.

The Preamble and s 2 of Te Ture Whenua Māori Act 1993 emphasise the retention and utilisation of Māori land in the hands of its owners, whānau and hapū . In order to occupy multiply owned Māori freehold land you must obtain either:

A licence to occupy (“LTO”) granted by the owners of the land, the trustees (if the land is under a trust), or committee of management (if there is a Māori incorporation); or
An occupation order granted by the Māori Land Court.

An LTO allows for a person to be granted occupation over a defined area or site on the land, under specified conditions. An LTO grants a personal right of occupation, rather than a legal interest over the land which means that it cannot be bought or sold.

The Māori Land Court has stated that unlike a standard licence, an LTO on Māori land may also be considered a special type of lease. This is due to the extent of the property rights that can be negotiated, such as:

Occupation of a defined area or site on land;
A set term for the LTO;
Right of assignment;
Compensation for improvement;
Payment of rent and rates.

All of these matters should be considered and discussed by both parties when entering an agreement.

How to obtain a licence?

Where Māori land is managed either by a trust or an incorporation, the trustees or the committee of management has the ability to determine who has the right to occupy the land and permission must be sought from them to do so.

In general, trustees or a committee of management are bound by the responsibility to manage the land for the benefit of all of the owners collectively. When considering whether to grant an LTO the trustees will need to ensure that in doing so they are able to meet their obligations and responsibilities as trustees.

Trustees or committee of management members should pass a resolution confirming their support for the LTO and then enter into a written agreement between the parties to ensure that each parties rights and obligations are clearly understood.

Where Māori land remains in multiple ownership without a management entity, permission from the majority of owners must be sought and should be supported by evidence of such, this could be done through a hui of the owners.

When does the Māori Land Court need to be involved?

An LTO is a personal agreement between the parties and generally can be entered into without interference by the Māori Land Court. This means that they can generally be formalised quickly and at a low cost.

The Māori Land Court is to be notified of an LTO where:

The term is for a period of 21 years or more, including any terms of renewal;
A party to any licence obtains a transfer, variation, discharge or surrenders a LTO which has a term of over 21 years.

Where the term is for a period of more than 52 years or if 1 or more terms of renewal equate to more than 52 years (a long term licence), approval of the Court must be sought.

Matters to take into account when considering a licence to occupy

An LTO can be granted to allow a person to:

Live on a specified area of Māori freehold land; or
Utilise a specified area of Māori freehold land for a specified purpose such as grazing.

Consideration should be had to whether a house is to be placed on at site and what the arrangements for that house will be when the licence comes to an end.

Further factors to consider are what will happen if the person holding the LTO passes away. At law an LTO does not generally form part of the deceased’s estate.

We recommend that trustees and/or committee of management members of Māori freehold land consider whether an LTO policy may benefit your whenua , trust or incorporation. We can also assist with providing a tailored LTO agreement suited to your needs.

If you would like further information please contact Kylee Katipo on 07 958 7424.

Related areas of expertise

Te Ture Whenua Māori/Māori Land Law

Related publications

July 2024 Navigating mediations in the Māori Land Court
June 2024 Top Tips for managing your Ahu Whenua Trust
March 2024 Tips for Updating Your Marae Charter – Whakapai Marae
May 2023 Māori Land Court’s jurisdiction over PSGE Trusts to be decided on a case-by-case basis

Must a licence to occupy part be assigned (and/or notice of assignment given to the licensee) to the new licensor on sale of the property for the licensor to be liable to pay the rent to the new owner? The licence refers to the owner (to whom the rent must be paid) as the person entitled to the property.

A licence is a personal permission by a licensor to a licensee to occupy property. It is fundamentally different from a tenancy agreement, which is an interest in land. For the purposes of this Q&A, we assume that the arrangement is a licence and not a tenancy. However, even if the document is termed a licence it might still be a tenancy if the trader has exclusive possession and there are

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Employed as a housing case worker in 2015 at award winning legal aid practice Turpin & Miller Solicitors in Oxford, trained and later became head of the housing team. After a series of high-profile cases, she moved to north-west specialist housing firm Pearson & Johnson Solicitors advising and representing local authorities and registered social landlords. Whilst there she obtained Higher Rights and conducted advocacy on behalf of the firm in the range of housing law issues. In 2014 was invited to join London chambers 42 Bedford Row to work with a specialist housing law team. Now represents a range of clients from inner-London borough councils to private clients in the full spectrum of housing law. Elizabeth provides regular training to the London Borough Legal Association. Recent cases include Obtaining and enforcing possession orders for landlords Defending possession claims for tenants Dealing with Human Rights defences Dealing with Equality Act defences Dealing with unlawful occupiers and squatters Unlwaful eviction and harassment Disrepair, nuisance and statutory nuisance Homelessness reviews and appeals in County Court Injunctions to prevent anti-social behaviour and other orders available under he ASB Crime and Policing Act 2014 including committal applications Service charge claims Leasehold management issues

Reversionary leases

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Model commercial leases

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When to use a licence to occupy instead of a lease

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Are you thinking of renting out a room, clinic or office? You may not need a full Retail or Commercial Lease to cover your arrangement because a Shared Office Space or Licence Agreement may suit your needs.

A licence generally does not give the licencee (the person you are licensing the space to) exclusive possession of the area. The landlord may be able to access the area freely, or it may be shared with others.

This is quite different to a lease, which gives the tenant exclusive use of the premises and an interest in the land that is second only to land ownership itself.

Think about a hairdresser, who rents out a space or a “chair” in his or her salon, to a beauty therapist – the licensor (the hairdresser) will still access and use the premises, but the beauty therapist is also able to work from the premises, in return for a licence fee.

A licence usually includes outgoings, facilities and amenities

Often in licensing arrangements, there is a shared use of facilities, such as toilet, kitchen, and common areas like a reception or waiting area. The licensee may have access to amenities such as tea and coffee making facilities, fridge, sandwich press, etc.

The landlord continues to pay for outgoings such as electricity and rates.

Expanding on the example above.

The therapist will usually be able to access shared floor area, sink, reception area, toilet, kitchen, tea and coffee making facilities. The therapist will not need to pay a share of rates or electricity – just a licence fee.

Additionally, on days the beauty therapist is not working, their room/chair/area can be used by someone else – that is, they do not have exclusive use of the salon, or even a room/space or chair.

Licences are a much more flexible arrangement that do not fall under the scope of the residential or retail leases legislation – so this can be seen as a huge positive for landowners.

However, you must be careful! Some landowners in the past have tried to pass off what is in fact a lease, as a licence. The courts are very quick to warn against this type of behaviour.

If you are licensing a room or space to another person, you must not dress a “lease”, in the clothing of a licence. That is, simply calling a “lease” a “licence” is not a way to escape the legislative regulations surrounding retail, commercial or residential leases. The circumstances surrounding the arrangement must be in line with what is considered to be a true licence.

Further, the language and terminology of a lease will be entirely different to that of a licence, as they are fundamentally different types of transactions. A lease is classed as a registrable interest in the land with certain statutory protections to the tenant. It is for exclusive use for a definite term and at a specified amount of rent. A licence is a right to use or occupy the premises in a certain way for a fee.

Knowing what is right for you

If you are entering into an arrangement where

you do not have the right to occupy the space exclusively; and
the property owner or other persons will still have access to the area you are using;

then a licence would most likely be the best option for you.

What are some other examples of a licence?

Some other examples may be:-

storage space in a garage; or
share office space or work space in a factory or on a farm
natural therapists using a clinic space
artists sharing a studio.

Can a Tenant be a Licensor?

It is possible for a tenant leasing a premises to sublet or license part of the premises but they would need the Owner’s / Landlord’s permission to do so. Subletting is generally covered in the original lease agreement.

The benefits of a licence

A licence allows you to get the most out of your premises by licencing areas out to others, whilst still allowing you to use and access the property.

Want more information?

The difference between a licence and a lease explained

Shared Office Licence Agreement

Storage Space Licence Agreement

Retail Lease

Commercial Lease

Residential Lease

Lease VS Licence

Difference between lease and licence: why it matters.

As William Shakespeare pondered centuries ago, “What’s in a name?”

Shakespeare may have been prophetic – in a modern legal context, the name given to a document or agreement may not reflect its true nature. If you have permission to use someone else’s land for a particular purpose, you may have entered into a written agreement with the landowner which sets out the terms and conditions of your occupation. The agreement may be called a licence or licensing agreement suggesting that you have a personal right to enter and use the premises.

However, on closer inspection, your so-called licence could turn out to be a lease giving you an interest in the land itself together with the rights and responsibilities of a tenant.

In these circumstances, the judicial view is that substance takes precedence over terminology with courts examining the true nature of the agreement rather than its language to ascertain the genuine intentions of the parties.

Clarifying the practical difference between a lease and a licence could help you to determine your rights and obligations and avoid costly litigation in the long term.

Lease vs. Licence – the Practical Difference

The key distinction in the difference between a lease and a licence is that a lease affords the tenant or lessee an interest in the leased premises which is manifested in the right to exclusive possession (see the case of Radich v Smith [1959] HCA 45 discussed further down).

Exclusive possession entitles the tenant to remove unwanted visitors (potentially including the landlord) during the term of the Lease.

By contrast, a licensee merely has a licence agreement to occupy the property and has no right to exclude others during the licensee’s period of occupation.

To highlight the difference between a lease and a licence, we have provided a selection of the rights and responsibilities of a tenant under a lease contrasted with those of a mere licensee who does not have the same interest in the land:

Common Law Right to Sue an Intruder in Trespass

Tenant under a lease : As discussed, a lease entitles the tenant to ‘exclusive possession’ of the Premises, which includes the right to expel an unauthorised visitor. This means that the tenant may have an action in trespass against the landlord if s/he enters the land without the tenant’s consent and without authorisation under the terms of the lease.

Licensee under a license : No such right of exclusion is available – the owner / licensor of the land may be free to enter the land at will.

Registration of Lease – Protection Against Competing Interests

Tenant under a lease : A long-term lease (for a term exceeding 3 years) in Queensland must be registered on the title in order to “transfer or create an interest in the lot”. See Section 181 and 182 of the Land Title Act 1994 (Qld). In the Queensland context, registration is optional for short-term leases of 3 years or less. Once registered, it will enjoy the protections of indefeasibility, meaning that the tenant’s interest in the land will take priority over other, unregistered instruments.

Licensee under a license : A licence cannot be registered and therefore it does not vest the licensee with an interest in the land.

Obligation to Pay Rent and to Keep in Repair

Tenant under a lease : Section 105 of the Property Law Act 1974 (PLA) provides that the tenant is obliged to pay the agreed amount of rent and keep the premises in good repair (except in the case of fire, flood or similar event rendering the premises unfit for the purpose). This provision can be excluded or modified by the express words of the lease.

Licensee under a license : The licensee’s repair and maintenance obligations, and the amount of rent payable, will depend upon the terms of the licence.

Breach of the Obligation to Keep the Premises in Good Repair

Tenant under a lease : If the tenant breaches this repair obligation, under Section 112 of the PLA, any damages recovered by the landlord must be proportionate to the resulting decrease in the value of the premises. The landlord cannot forfeit the lease for a failure to repair without complying with the Section 124 notice requirements (see below).

Repair Obligations Will Depend Upon the Terms of the Licence

Tenant under a lease : Section 107 of the PLA allows the landlord a limited right of entry to view and make repairs to the leased premises (representing an exception to the tenant’s right of exclusive possession). However, this can be excluded by the express terms of the lease.

Licensee under a license : The licencor can generally enter the premises at any time and for any purpose (whether to make repairs, view the premises or otherwise). If the licensing agreement limits the licensor’s capacity to enter the premises, the license may constitute a lease.

Right to Assign or Sublease to a Third Party

Tenant under a lease : Per section 121 of the PLA, the landlord cannot ‘unreasonably’ refuse to consent to the proposed assignment or sublease. This section cannot be excluded by the express provisions of the lease, but will only operate in circumstances where the landlord’s consent is expressly required.

Licensee under a license : The licensee has a mere personal right to use and occupy the property, and is not able to enter into an assignment or sublease unless the express terms of the licence agreement allow it.

Right of Forfeiture / Re-entry

Tenant under a lease : Section 124 of the PLA provides that if the tenant is in breach, the landlord cannot forfeit the lease and retake possession of the premises without first giving the tenant notice of the forfeiture and a reasonable time to rectify the breach or pay any ‘reasonable compensation’ for the damage. (However, this protection is not available for leases / tenancies of 1 year or less.)

Licensee under a license : A licensee enjoys no such protection. In theory, a licence may be terminated at the will of the landowner / licensee even though contractual damages may apply.

Subdivision Approval Requirements Under the Sustainable Planning Act 2009 (Qld)

Tenant under a lease : A lease of part of a lot (that is not part of a building) for a term exceeding 10 years (including options to renew) will constitute a ‘reconfiguration of a lot’ requiring subdivision approval from the local authority.

Licensee under a license : Not so for licences.

Shared Occupancy

Tenant under a lease : A lease affords the tenant an exclusive right of possession and is therefore unsuited to shared use / occupancy.

Licensee under a license : A licence is suitable to shared use (making it appropriate for a number of arrangements our church clients enter into).

Case Law: Radich v Smith – Lease or Licence?

In the case of Radich v Smith [1959] HCA 45 (“Radich’s case”), a small business owner, Maria Radich, entered into a deed of agreement to operate her milk bar out of a lock-up shop in Sydney’s Mossman area.

Under the terms of the agreement, Ms Radich was granted the “sole and exclusive license and privilege to supply refreshment to the public…and to carry on the business of a milk bar.”

However, despite the use of the term licence, the High Court ultimately found that Ms Radich had been granted a lease of the premises for the agreed period.

Justice Windeyer held that, “I imagine all concerned would have been astounded if they had been told that the appellant [Ms Radich] had no right to exclude persons”, especially given that the premises was a lock-up shop and therefore not readily accessible to others outside Ms Radich’s business hours.

His Honour further noted that it would be equally astonishing if the owners of the shop were able to “licence other people to carry on any activity there” provided only that this did not interfere with Ms Radich’s business operations.

Clearly, Ms Radich was implicitly entitled to remove unwanted visitors and to conduct her milk bar business without unauthorised entry or interference. This gave her a right to ‘exclusive possession’ of the premises for the term of her occupation, an arrangement more consistent with a leasehold interest. She was therefore entitled to have her rent determined by the Fair Rents Boards (one of the protections afforded to tenants in New South Wales at that time).

Determining the Parties’ Intentions

Justice Windeyer noted that the difference “between a lease and a licence” is ultimately “a question of intention.”

But, His Honour proceeded to say:

Intention to do what? Not to give the transaction one label or another. Not to escape the legal consequences of one relationship by professing that it is another. Whether the transaction creates a lease or a licence…depends upon the nature of the right which the parties intend the person entering upon the land shall have in relation that land.

His Honour therefore acknowledged that language has the potential to mislead – certain terms may be adopted, sometimes unconsciously, sometimes with the deliberate intention of concealing the true nature of the parties’ agreement and evading the attendant legal ramifications.

Therefore, even if your agreement is called a lease (or a licence), this is not necessary conclusive. It is essential to consider the entire agreement (not just isolated terms) in order to determine the rights and interests the parties intended to create.

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Lease or Licence? Which one is most appropriate for my circumstances?

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Introduction

Leases and licences both entitle a person (either a tenant/lessee or a licensor, depending on the agreement) to enter into and use a property, or part of a property in a certain way. Leases and licences are used by parties across a broad range of sectors and can include (but are not limited to) retail, hospitality, manufacturing and agribusiness.

Both licences and leases ordinarily have a number of similar provisions, the lease/licence will be for a defined term and set out details of a permitted use of the premises, the licensee/tenant will pay money to the licensor/landlord and there will be provisions setting out the rights and obligations of each party to the agreement.

However there are a number of differences between the rights afforded pursuant to a licensee as compared to a lease, which need to be considered by parties entering into an arrangement for use of a property.

What should I be thinking about when seeking to enter an arrangement for use of a premises / land?

The matters you should consider when entering an arrangement for the use / occupation of land (which will determine whether the arrangement is a lease or a licence) are as follows:

Is there an intention that the tenant will have exclusive use of the property, or will the landlord or third parties also still have a right to use and access the property?

The key difference between a licence and a lease is that a lease grants exclusive possession of a premises to a tenant. This means that a tenant under a lease may exclude all others, including potentially the landlord, from the premises.

A licence on the other hand grants non-exclusive possession of a premises to a licensee. The licensee has a mere contractual right to enter onto and use the premises for a particular purpose.

As such, under a licence, a licensor is often entitled to enter onto the premises at will, without notice to the licensee and/or to grant a licence to other third parties to also enter onto and use the premises for a purpose (provided that use does not interfere with the licensees’ use of the premises).

Licences are often used where there is shared use of a space (i.e. toilets used by multiple tenants of a building or co-working spaces) or where exclusive use cannot be guaranteed because there is no way to effectively exclude access to the space by third parties (i.e. for a car parking space or an unfenced area which borders public space).

How flexible do the parties intend the arrangement to be?

A licence may afford more flexibility to parties, for example by providing for a shorter term arrangement, more limited obligations upon the tenant, the ability to adjust the defined area which has been licensed or may provide for early termination of the arrangement if required by one of the parties.

What is the intention for use of the property by the tenant?

The Retail Leases Act 2003 (Vic) (the Act ) does not govern licence agreements (except where that licence agreement can be held to be a lease arrangement). As such, licensees do not receive the protections afforded by the Act, even where the use of the premises by the licensee could be held to be a retail use.

Additionally, a tenant under a lease has greater protections at law (whether by operation of the Act or other legislation) against termination and re-entry, which are not available to a licensee (unless the terms of the licence provide for same).

Is there any intention to sell the property during the term of the arrangement, and if so what is the effect of the sale on the arrangement?

A lease is a proprietary right / interest in land. If the premises is sold by the landlord during the term of a lease, that lease is automatically assigned to the purchaser of the premises upon settlement.

Because a licence is a contractual right (which is only enforceable as between the parties, and not against any third parties), it will only bind a purchaser on a sale where the purchaser of the property has agreed to a transfer or assignment of the licence.

Would a lease or a licence suit my purposes?

Your individual circumstances which include the matters set out above need to be taken into account when deciding whether a lease or a licence is most appropriate for your circumstances. What use will be made of the property, the intentions of the parties and any obligations upon the tenant/licensee will form a part of these considerations.

A licence can be cheaper and easier to prepare, and may contain less obligations on the parties in relation to the premises, but may not be the most appropriate arrangement, particularly where there is a need to exclude third parties from the premises. This may be important when the tenant will be carrying on a business in the premises.

The document I have is entitled “Lease”. Does that mean I can assume it is a lease?

Even where parties uses the language of “licence” or “lease” in documenting their arrangement, you should be aware that this is not necessarily determinative of the nature of the agreement.

In a dispute, it is the substance of the agreement between the parties and their intention (i.e. the nature of the rights the parties intended the licensee/tenant to have in relation to the premises) that is relevant to a determination of whether an agreement is a lease or licence arrangement. This is determined objectively, on the basis of both the terms of the agreement and the surrounding circumstances (which include acts by the parties).

Whether it was the intention of the parties that the tenant/licensee have exclusive possession of the premises is an important factor in this assessment. Cases which have considered this include the following:

Raidaich v Smith (1959) 101 CLR 209 – where the agreement between the parties was held to be lease (despite the deed using the word licence) on the basis that it could be shown that the substance and effect of the deed was to give Radaich exclusive possession of the premises. The premises was a lock up shop in which Radaich ran a milk bar business.
Lewis v Bell (1985) 1 NSWLR 731 – where it was held that the arrangement between the parties (which was termed a licence) was in fact a licence arrangement. The arrangement was held to be a right to use stables and associated facilities for the stabling of horses to run at the racecourse by the trainer, but this arrangement was a personal right which did not amount to exclusive possession.
Swan v Uecker [2016] VSC 313 – where the Supreme Court of Victoria held that a particular Airbnb rental arrangement amounted to a lease and was not merely a licence to occupy the property. Again, a finding that the Airbnb tenants had exclusive possession of the apartment during their stay was a critical factor in determining the nature of the arrangement. As a result of this, the respondents, who were themselves tenants, were found to be in breach of their lease (on the basis that subleasing was prohibited pursuant to that lease).

For this reason, it is important the parties seek advice when entering into an arrangement to allow use of a premises to a third party. Your legal representative can ensure that the agreement most appropriately meets your needs, and that there will be no dispute as to its nature at a later time.

How can Coulter Legal assist me?

Coulter Legal can assist you in relation to the preparation or review of a licence or lease arrangement, including providing advice on what arrangement would be best for your individual circumstances.

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Contracts and Deeds - Land and Buildings

Lease vs licence

Common contractual arrangements in commercial property.

Choosing the premises from which to operate your business can be daunting; it is essential that you know you are entering into the right type of agreement to suit your intentions.

Leases and licences are common contractual arrangements. Although both are similar, there are crucial differences between them which can have significant implications for anyone who owns or occupies commercial premises. Knowing their differences, and when to use each, will help prevent any confusion, conflict or loss that may arise if you are not fully informed.

Possession or occupation?

The essential distinction between a lease and a licence is the type of rights they grant in relation to the property. A lease grants you exclusive possession of the property, but a licence only grants the right to occupy and use the land.

‘Exclusive possession’ in a lease situation means you can exercise control over the property and exclude all others from it, even the owner of the property, except where they have a legal right to enter the premises, for example to complete repairs or inspections. Occupation, however, is a right to use the property for a certain purpose and does not give you the right to exclude other people from it.

A lease typically grants much wider rights than a licence because it gives you control of the property subject to some exceptions. The obligations imposed on you under a lease may be extensive, but provided you are not in breach of the lease, possession of the property will stay with you. Under a licence, however, the opposite is the case. Control and possession of the property stays with the owner except where you are granted certain limited permissions.

This is the main area where difficulties can arise in defining leases and licences because the name of the document may not reflect its true nature. It is not just a case of what language is used, but rather the content of the agreement, and the rights and obligations it creates.

Certainty of term

The length of the arrangement is another important point of difference. Leases are typically long-term arrangements and must be for a fixed period and have certainty around the start and end date. Even a periodic lease has clear terms about how and when it can be ended.

A licence, however, can be for an uncertain period and, depending on the terms of the licence, can be cancelled by either party by giving written notice. The advantage of a lease is that it gives both parties more security because the length of the arrangement is certain, but this in turn means it offers less flexibility than a licence.

Changes of ownership

A lease is a legal interest in land and will survive changes in ownership if the owner sells the property. For example, if a commercial building has a tenant under a lease and is sold, the buyer buys the building with the tenant in place. The tenant can also assign the lease to another party with the owner’s consent through a deed of assignment without the new tenant having to enter a whole new lease.

A licence is different. It is a personal contract between the owner and licensee and generally cannot be transferred to another person. If the owner sells the property, the licence will come to an end.

Both have advantages

The crucial factor that distinguishes a lease from a licence is the scope of the rights, powers and obligations it grants or imposes. A lease generally gives you very wide powers to deal with the land and exclude others from it and anything that falls short of this is generally a licence.

Deciding whether to enter into a lease or licence will therefore depend on your intentions for the space. If you want long-term security and exclusive control over the property a lease will usually be preferable, but it comes with maintenance and other obligations and is generally a longer term commitment.

A licence may be more suitable for short-term use where more flexibility is required or where the parties are still uncertain about their commitment to the arrangement. A licence is useful, for example, where you have a pop-up shop or use a space that is shared by multiple users.

The important thing is to get good legal advice before you sign on the dotted line so that you can be sure of the rights and obligations you are taking on, and the agreement fits your particular situation. Get in touch with us today to see how we can help you.

Disclaimer: All the information published in Commercial eSpeaking is true and accurate to the best of the author’s knowledge. It should not be substituted for legal advice. No liability is assumed by the authors or publisher for losses suffered by any person or organisation relying directly or indirectly on this newsletter. Views expressed are the views of the authors individually and do not necessarily reflect the view of this firm. Articles appearing in Commercial eSpeaking may be reproduced with prior approval from the editor and credit being given to the source.

Posted in Commercial eSpeaking ; Posted 3 years ago by Commercial eSpeaking

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A Lease or a Licence – What’s the Difference?

Table of contents.

Summary of Similarities and Differences
CONTRIBUTORS

Leases and licences are an integral part of land ownership in Australia. These arrangements allow landowners to grant rights to other persons to occupy their land for rent or a fee. Although both these arrangements are widely known and utilised, there are vital differences between them which are, in some circumstances, misunderstood. This can have undesirable consequences, especially for landowners who believe they have granted a licence to a licensee, but have mistakenly granted a lease. This article will outline the definitions of these arrangements, discuss cautions and will summarise the similarities and differences between them for clarification.

A lease is an interest in land granted by a landowner (referred to as “landlord” or “lessor”) to another person (referred to as “tenant” or “lessee”), which confers a right of exclusive possession over the land for a fixed duration. [1]

The primary difference between a lease and a licence is that a lease grants the tenant or lessee the right of exclusive possession . Exclusive possession is “the very essence of the proprietary interest conferred upon a lessee by a lessor”, [2] and allows a lessee to use the land to the exclusion of others, including the landlord (subject to the terms of any lease granted). This interest can be registered on title to the land, affording the lessee the protection of the NSW Torrens Title Register.

Exclusive possession is an attractive quality in choosing a lease over a licence, especially in circumstances where the tenant is conducting a business that requires security of occupation and minimal interruption i.e. a retail shop or commercial office. However, there may be circumstances for landowners and other persons alike where a licensing arrangement may be more suitable.

In relation to property law, a licence is a right to occupy land without any interest in the land being granted. [3] As such, a licence is not a proprietary interest that can be registered on the title to the land. This means licences do not afford the same protections that leases do, and are therefore an inferior form of occupation. Although this is the case, licensing arrangements can be attractive in circumstances where a licensee may want a short-term, flexible arrangement that can be ended on short notice. A landowner may also desire this where there is a short-term event, during which, they require ongoing access to the property.

An example may include a food truck at a music festival. At these events, a landowner is normally required to serve food. To meet this requirement, the landowner may grant licences to food truck businesses to occupy part of the land to provide food. In such circumstances, the exclusive possession granted by a lease would be inappropriate, as a food truck business would be sharing with other businesses and the landowner would require ongoing access to the land to ensure the event is running smoothly. It would also be impractical due to the short-term nature of the event, which is usually no more than a day.

Below is a table summarising the similarities and differences between leases and licences as discussed above:

One of the major cautions with licensing arrangements is that they can, in some circumstances, be deemed to be a lease (and vice-versa). This is because Courts construe these arrangements based on the substance of the relationship between the parties, regardless of the form or the name of the document used to create the legal relationship.

For example, in the often-cited case of Radaich v Smith , [4] the landowners granted a “licence” to a person operate a milk bar for 5 years. Even though the licence deed used terms normally used in a licensing relationship, the High Court ultimately looked at the substance of the agreement between the parties and found that the landowner had actually granted exclusive possession of the land to the milk bar operator for a fixed duration. [5] Therefore, a lease, rather than a licence, had been granted in the circumstances, thereby amplifying the rights of the now lessee.

In contrast, cases such as Lewis v Bell [6] have found that even where a licensing agreement had terms restricting access by the landowner and the “giving up of possession” at the end of the licence term, this could not be construed as a lease. This is because the Court found – based on multiple factors – that exclusive possession of the premises had not been granted. [7] In reaching its conclusion, the Court looked at factors such as the sharing of the facilities, the prevention of assignment and the limited purpose for which the “use” of the property was licensed. [8]

Understanding the difference between a lease and a licence is crucial for landowners seeking to grant a right to another person to occupy their land. Each case will turn on its own facts, so it is vital that landowners and occupiers alike seek professional advice from a qualified lawyer to ensure they choose an arrangement that suits them best and reflects the substance of the relationship between the parties.

This article was co-written by Lawyer, Jack Harman.

This article is not legal advice. It is intended to provide commentary and general information only. Access to this article does not entitle you to rely on it as legal advice. You should obtain formal legal advice specific to your own situation. Please contact us if you require advice on matters covered by this article.

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Residential licences to occupy

Provided that the circumstances are suitable for use, residential licences to occupy give both landlord and tenant much greater flexibility over the terms of occupation. This section includes a licence to use a garage as well as the more commonly used lodger agreements.

Rental agreement: licence to rent a room

Use this rental agreement to rent a room in your home to one or more people. This agreement creates a licence to use the property, with far fewer legal requirements for the landlord than a lease or a tenancy agreement.

Licence agreement for a car parking space

Licence to use a car parking space in any situation.

Licence agreement: letting private garage

A letting agreement for renting a garage, a lock-up, or any other small building or piece of open land for non-business use for a short term of up to 3 years. Do not use if tenant wants business use.

Parking space agreement

A licence agreement where the owner can sub-license his flat car space currently not in his use, to someone else for a period of time.

Employee accommodation agreement

This employee accommodation agreement grants a licence to occupy to an employee living in accommodation (from a single room to a whole property) provided by the employer for the better performance of their work duties.

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Ways to Add Users for Webex Contact Center

You can add users manually, in bulk using the comma-separated value (CSV) files or using the automatic license assignment. Manually you can add up to 25 users, and with CSV, you can add up to 1000 users to your organization for contact center access.

For more details on automatic license assignment, see Set up automatic license assignments in Control Hub .

Use the automatic license assignment to assign standard or premium license to a user. You can continue to mark a user as a supervisor manually.

Avoid adding a user to multiple groups as a user requires a single contact center license. If both standard and premium licenses are assigned by adding a user to multiple groups, the premium license applies.

While configuring automatic license assignment for contact center users, avoid applying the template to the existing users. If applied to existing users, all custom profiles may reset to default user profiles. We recommend that you use the automatic license assignment for new users.

After updating an existing user's license, it is necessary to synchronize the users with Control Hub. For instructions on how to perform this synchronization, refer to the "Sync Users" section in the Tenant Settings article.

When a user is deleted on Control Hub, the corresponding contact center user will be deleted automatically.

From the Services section of the navigation pane, choose Contact Center > Settings > General > Service Details.

field shows 1.0, follow the steps as mentioned in the article .

field shows New Platform, follow the steps as mentioned in the article .

If you're adding users who used their email address to create a trial account on Webex, delete their organization before adding them to your customer organization.

1	Sign in to the customer organization on .
2	Go to Users and then click Manage Users.
3	Choose Manually Add or Modify Users and click Next.
4	Perform one of the following steps. radio button. radio button. Enter the first name, last name, and email address of the new user. In this screen, you can add the details of up to 25 users. To add the details of another user, click the Plus (+) icon next to the Email address field.
5	After you have entered the details of the new users you want to add, click Next.
6	To assign a license to a user, check the Contace Center check box and choose the license type you want to assign to the agent. The available license types are: :Choose this license type to provide standard agent features to the user. :Choose this license type to provide premium agent features to the user. Do one of the following: : Choose this option to provide premium agent features to a user. : Choose this option to provide the supervisor role to a user. > Administrator roles. Check the Organization administrator check box. Click the Full administrator radio button. page. Go to User Details > Administrator roles. Check the Organization administrator check box. Click the Full administrator radio button. > Administrator roles. Go to User Details > Administrator roles. Check the Organization administrator check box. Click the Contact Center service administrator check box. . Uncheck Organization administrator or Contact center service administrator based on the administrator role. .
7	Click Save. A default user profile provides access to Webex Contact Center features for users with Contact Center licenses or entitlements. For information about user profiles, see the section in the .

1	Sign in to the customer organization on .
2	Go to Users and then click Manage Users.
3	Choose Manually Add or Modify Users and click Next.
4	Perform one of the following steps. radio button. radio button. Enter the first name, last name, and email address of the new user. In this screen, you can add the details of up to 25 users. To add the details of another user, click the Plus (+) icon next to the Email address field.
5	After you have entered the details of the new users you want to add, click Next.
6	To assign a license to a user, check the Licensed agent check box and choose the license type you want to assign to the agent. The available license types are: :Choose this option to provide standard agent features to a user. :Choose this option to provide premium agent features to a user. :Choose this option to provide the supervisor role to a user.
7	(Optional) To assign administrative privileges to a user in Webex Contact Center, check the Administrator check box. in the previous step, the Administrator check box is disabled. check box, continue with Step 8.
8	To assign either the full administrator or Contact Center service administrator role to a user, do one of the following: > Administrator roles. Click the Full administrator radio button. > Administrator roles. Check the Contact Center service administrator check box. For information about Contact Center-specific privileges of all Control Hub administrator roles, see the article .
9	Click Save. A default user profile provides access to Webex Contact Center features for users with Contact Center licenses or entitlements. For information about user profiles, see the section in the .

Before you begin

If you have more than one CSV file for your organization, then upload a file. When the task is complete, you can upload the next file.

Some spreadsheet editors remove the + sign from cells when the .csv is opened. You can use a text editor to make .csv updates. If you use a spreadsheet editor, ensure to set the cell format to text, and then add any + signs.

1	From the customer view in , go to Users, click Manage Users, and choose CSV Add or Modify Users.
2	Click Export to download the file and enter the user information in a new line in the CSV file to set either of these licenses: column to TRUE. columns to TRUE. The system assigns an Agent role to the user. If both and columns are set to , then the system removes the Webex Contact Center license. section.
3	Click Import, select your file, and click Open.
4	After the system uploads the CSV file, scroll down and choose either Add services only or Add and remove services and click Submit.
5	After the import is complete, close the Tasks dialog box.
6	Synchronize users to Webex Contact Center Management Portal. Navigate to Services > Contact Center > Settings > General, and click Synchronize Users.
7	Upload the Agent details in Management portal. For more information, see the section in .

Get started with Webex Contact Center
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COMMENTS

Using a License Agreement Instead of a Lease
Using a License Agreement Instead of a Lease. By Adam Leitman Bailey and John M. Desiderio. A number of years ago, I sat down with one of the New York's real estate legends and his company's general counsel. He was bothered by New York's eviction process — the loss of rental income, the wasted legal fees, and the incredible amount of ...
What if there's no written lease?
A licence to occupy is a personal right for the occupier to use the property. It is simply permission for the licensee to do something on a licensor's property, and does not create an estate in land. One of the key indications of a licence is that the licensee does not have the right to exclusive possession of the premises.
When to use a Licence To Occupy or Tenancy Agreement
Length of term. It is common to use a licence to occupy: for short-term arrangements (say, up to 12 months), or. where a fixed term is not acceptable, e.g. the owner gives permission to use and occupy the residential property on an ongoing monthly basis. In such circumstances, the licence will state the amount of notice that either party must ...
Understanding the differences: Lease vs Licence to Occupy ...
One of the main differences between a Lease and a Licence is the level of control a tenant has over the property. With a Lease, the tenant has exclusive possession of the property and can ...
Key Differences: Lease and Licence Agreement
Exclusive Possession. A fundamental difference between a lease and licence agreement is that only a lease can grant the right of exclusive possession to land or premises. This is where the tenant has permission to exclusively use and occupy the premises. They also have the right to exclude others from the premises (including the landlord).
What is the Difference Between a Commercial Lease and a License to
A license to occupy real property, on the other hand, is merely a privilege to use the real property and no property estate is created. A license is generally revocable by either party upon notice, at will - with or without cause and is usually not assignable the way a lease can be assigned to another entity with the landlord's consent.
Business Licence to Occupy
A business tenant will enjoy exclusive occupation of the relevant property. A business licensee will only have the right to use a space or room as may be specified from time-to-time, and the licensor will retain the right to occupy that space at all times. A business licence to occupy will usually only last for a short period (commonly 6 months).
Licence to Occupy Offices Agreement Template
Assignment of Lease/Transfer lease agreement to new tenant (P105) Surrender of Lease / Rental Agreement Cancellation Template (P103) Commercial Lease Agreement Template UK (Under 7 Years) (P106) This licence to occupy offices is a short term agreement (up to 6 months) where the licensee does not have exclusive occupation.
Licence to occupy: How long can a licence to occupy last for?
A licence is a personal right or permission for a party to use, or 'occupy', a property. More specifically, a licence to 'occupy' is essentially permission for one party to do something on another party's property. It is, by its very definition, not a lease. The owner of the property is usually referred to as the 'licensor', and ...
Licence to Occupy
A licence to occupy can be granted for a fixed period of time (normally a month, six months or a year) or be periodic (normally weekly or monthly). The granting of a licence to occupy is normally more temporary in nature than a tenancy. Even if the licence to occupy is temporary it is important that the licence to occupy is put in writing and ...
What is a license to occupy and why do you need one?
A licence gives you permission to occupy the property under certain conditions. They are much less formal than a lease, and so can be done more quickly and cheaply. However, as the saying goes, you get what you pay for. If you have a licence, that means you have much less protection. With a licence, it's much easier for the landlord to make ...
What is a Licence to Assign? A Summary
A licence to assign is a landlord's permission for a tenant (the assignor) in occupation under a lease to assign the lease to a new incoming tenant (the Assignee). It should be noted that this permission does not necessarily need to be in a formal deed. Therefore, landlords and agents should be mindful of falling into the trap of granting ...
Licence to occupy
A licence to occupy ("LTO") granted by the owners of the land, the trustees (if the land is under a trust), or committee of management (if there is a Māori incorporation); or. An occupation order granted by the Māori Land Court. An LTO allows for a person to be granted occupation over a defined area or site on the land, under specified ...
Must a licence to occupy part be assigned (and/or notice of assignment
A licence is a personal permission by a licensor to a licensee to occupy property. It is fundamentally different from a tenancy agreement, which is an interest in land. For the purposes of this Q&A, we assume that the arrangement is a licence and not a tenancy.
When to use a licence to occupy instead of a lease
The benefits of a licence. A licence allows you to get the most out of your premises by licencing areas out to others, whilst still allowing you to use and access the property. Want more information? The difference between a licence and a lease explained. Shared Office Licence Agreement. Storage Space Licence Agreement. Retail Lease. Commercial ...
Lease VS Licence
By contrast, a licensee merely has a licence agreement to occupy the property and has no right to exclude others during the licensee's period of occupation. : As discussed, a lease entitles the tenant to 'exclusive possession' of the Premises, which includes the right to expel an unauthorised visitor. This means that the tenant may have ...
Lease or Licence? Which one is most appropriate for my circumstances?
Swan v Uecker [2016] VSC 313 - where the Supreme Court of Victoria held that a particular Airbnb rental arrangement amounted to a lease and was not merely a licence to occupy the property. Again, a finding that the Airbnb tenants had exclusive possession of the apartment during their stay was a critical factor in determining the nature of the ...
Can a licence be assigned?
650+ full-time experienced lawyer editors globally create and maintain timely, reliable and accurate resources across all major practice areas. 83% of customers are highly satisfied with Practical Law and would recommend to a colleague. 81% of customers agree that Practical Law saves them time. Can a licence (as opposed to a lease) be assigned?
Lease vs licence
The essential distinction between a lease and a licence is the type of rights they grant in relation to the property. A lease grants you exclusive possession of the property, but a licence only grants the right to occupy and use the land. 'Exclusive possession' in a lease situation means you can exercise control over the property and ...
A Lease or a Licence
A lease is a proprietary interest granting exclusive possession for a fixed term, where a licence is a mere right to occupy land. ... In reaching its conclusion, the Court looked at factors such as the sharing of the facilities, the prevention of assignment and the limited purpose for which the "use" of the property was licensed.
When is a licence a lease?
A licence to occupy can be a useful tool where the parties are seeking a relatively informal arrangement for a short term without the burden of more onerous lease conditions. However, there must be careful consideration when drafting to avoid the arrangement actually being a lease. It is not enough simply to call the document "a Licence".
Residential Licences to Occupy
17 Reviews. This employee accommodation agreement grants a licence to occupy to an employee living in accommodation (from a single room to a whole property) provided by the employer for the better performance of their work duties. More Information & Download. Backed by our watertight guarantee.
Licence to Occupy
A licence to occupy, also known as an occupancy licence, is a legal agreement that grants a person or entity the right to occupy and use a specific property for a defined period. Unlike a lease or tenancy agreement, a licence to occupy does not create a landlord-tenant relationship or confer exclusive possession rights. Instead, it allows for a ...
Ways to Add Users for Webex Contact Center
For more details on automatic license assignment, see Set up automatic license assignments in Control Hub. Use the automatic license assignment to assign standard or premium license to a user. You can continue to mark a user as a supervisor manually. Avoid adding a user to multiple groups as a user requires a single contact center license.