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Summary 2 Obligations of Lessor
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Summary of 5 pages for the course Mercantile Law 193 at SUN (Merc Law summaries)
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Obligations of LessorDelivery of Leased Property to Lessee
Must put Lessee in Position to Use & Enjoy Leased
Property
- Lessor has to provide lessee w/use & enjoyment of property & put him in
undisturbed possession of property.
- Means that lessor has to see that nobody else is occupying leased property.
- In case of long term lease, lessor has duty to cooperate to have lease
registered.
- Must do everything necessary to provide use & enjoyment
- Lessee must be placed in possession of property at time agreed upon
(otherwise lessor will be in mora).
Must Deliver Property Being Let in Proper Condition &
Maintain
- Delivery of property should be made in condition expressly/tacitly agreed,
alternatively in condition leased property is at time of concluding lease
- Where Property is let for particular purpose, lessor gives implied warranty that
property let is suitable for that purpose
- Lessor should maintain leased property in condition that it has been received,
agreed/for purpose it was let except for normal wear & tear.
- This is naturale of contract of lease (implied term) & will amount to breach of
contract if lessor doesn’t comply w/duty.
- Parties may vary content of this obligation/exclude it by agreement
- Lessee must repair any damage which he caused himself & should also pay
for less serious running repairs
- Remedies available when lessor does not comply w/duty to maintain:
Specific performance:
o Lessee can obtain it indirectly by informing lessor of defect & if
latter fails to repair same, lessee may then make repairs & claim
costs from lessor/deduct it from rent.
o If deducted from rent, there must be proof of cost of repair &
must also be proven that lessee first notified lessor of defect but
that lessor failed to repair same & only then proceed w/repairs.
The lessee will, however, be liable for any damage that is
caused during repairs.
, Cancellation/rescission:
o If defect exists at time of delivery & so serious that it can’t
reasonably be expected of lessee to receive leased property in
that condition, lessee can cancel lease immediately & ask for
restitution of any monies paid.
o If defect arises during lease & becomes practically impossible to
use leased property any longer/doesn’t have any use, lessee
may cancel if has given notice of defect to lessor & has given
him reasonable opportunity to repair leased property.
Reduction of rent:
o If breach is less serious not allowed to cancel.
o Where lessee elects to abide by contract, entitled to reduction in
rent proportional to his diminished use.
Damages:
o Can be claimed as supplementary remedy to remedies
mentioned above, if lessor knew of defect/ought to have known
because of work/profession.
o Onus on lessee to prove lessor knew/should have known of it.
Ensure Remains in Undisturbed Possession
- No obligation/ex lege warranty that lessor is owner of leased property/has
capacity to lease property.
- Contract is valid even if lessor is not owner/even if he doesn’t have capacity to
lease property.
- Lessor only warrants that lessee will have undisturbed enjoyment of property
for duration of lease.
Disturbance by the Lessor
- Lessor may not enter premises unlawfully
- May however inspect it from time to time but after reasonable notice.
- He has to ask permission to enter premises.
- Lessor may however enter premises lawfully to make necessary repairs he
may even ask lessee to evacuate premises temporarily for that purpose.
- At end of lease period, he may put up notice inviting interested & prospective
lessees to have look around if arranged w/lessee.
- Can even put up notice of sign to view if was also arranged w/lessee.
- Right has to be exercised reasonably
- If lessor doesn’t meet this obligation he will be in breach of contract.
- Following remedies will be available for lessee:
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