ABSTRACT
The leasehold is one of the two estates identified in section 1 of the Law of Property Act (LPA) 1925 as capable of existing as either a ‘legal’ or ‘equitable’ interest. As we shall see, whether any given lease is legal or equitable will depend primarily on the way in which it is created. However, irrespective of whether a leasehold is legal or equitable, there is no doubt that it is one of the most versatile concepts known in the law of real property. Even the terminology of leases reflects the many purposes to which they may be put. The ‘term of years’, ‘tenancy’, ‘sublease’ and ‘leasehold estate’ are all terms in common use, and all of them describe the existence of a ‘landlord’ and ‘tenant’ relationship. For example, a ‘lease’ or ‘term of years’ is most often used to describe a commercial or long-term letting, whereas the description ‘tenancy’ is used for residential or short-term lets. This variety does not mean that different substantive rules apply to different types of lease (although this may be the case where a statute applies only to one kind of lease), but it does indicate the importance that the leasehold plays in the world of commercial and residential property management. In this respect, three fundamental features of the leasehold should be noted at the outset.
