TERMINATION OF LEASES 1 Grounds for termination of leases Expiry or effluxion of time Notice Forfeiture Surrender Merger Frustration?
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TERMINATION OF LEASES 2 Expiry or Effluxion of Time Under common law, the lessor is entitled to automatic possession when a lease comes to an end – time or by reason of a condition. The Rent Act however puts some restrictions on the right of the lessor to retake possession on the expiration of a lease. KAG - FLAW 210- IMMOVABLE PROPERTY II - TERMINATION OF LEASES 3 Notice Where a lease makes an express provision for termination by notice, either of the parties can exercise that right by giving the requisite notice. Savage v. GIHOC[1973] 2 GLR 242 For notices on periodic tenancies see the Court of Appeal decision in Alameddine Brothers v. Paterson Zochonis & Co. Ltd [1971] 2 GLR 403
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TERMINATION OF LEASES 4 Forfeiture The right of a landlord to forfeit a lease arises at common law where An event which has been expressly stipulated in the lease as terminating it has occurred; The tenant has breached a condition in the lease (subject to statutory restrictions); S. 29 (1)
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TERMINATION OF LEASES 5 Forfeiture The tenant has breached a covenant in a lease which has been fortified by a forfeiture clause. S. 29 (1) Sackey v. Ashong
Bassil v. Said Raad (1958) 3 WALR 108
Western Hardwood Enterprises Ltd. v.
West African Enterprises Ltd Asante v. K. Compu Services Ltd. [2001- 2002] 1 GLR 562 KAG - FLAW 210- IMMOVABLE PROPERTY II - TERMINATION OF LEASES 6 Forfeiture The lessee denies the title of the landlord. This gives the landlord an automatic right to forfeit the lease without any statutory restrictions. Antie & Adjuwah v. Ogbo [2005-2006] SCGLR 494 Safo v. Badu [1977] 2 GLR 63
Adu-Sarkodie v. Karam & Sons Ltd
[1975] 1 GLR 411 KAG - FLAW 210- IMMOVABLE PROPERTY II - TERMINATION OF LEASES 7 Forfeiture – Asserting the right Section 29 of NRCD 175: By action or otherwise.
It has however been held that the
usual practice is for the lessor to sue for recovery of possession. Interplast v. Bonsu [1979] GLR 285 KAG - FLAW 210- IMMOVABLE PROPERTY II - TERMINATION OF LEASES 8 Forfeiture – Asserting the right Section 29 Notice to lessee specifying breach; Requiring lessee to remedy if remediable; Payment of reasonable compensation; Lessee should have knowledge of the fact that notice has been served; Lessee fails to remedy breach within a reasonable time. Western Hardwood Enterprises Ltd. v. West African Enterprises Ltd [1998-99] SCGLR 105 KAG - FLAW 210- IMMOVABLE PROPERTY II - TERMINATION OF LEASES 9 Forfeiture - Waiver The lessor may waive his right to forfeit. The waiver must be related to a particular breach and is not continuous. Section 32 of NRCD 175 The waiver may be express or implied. KAG - FLAW 210- IMMOVABLE PROPERTY II - TERMINATION OF LEASES 10 Forfeiture - Relief The court may grant a relief against forfeiture to a lessee or a sublessee. Section 30 of NRCD 175 Section 17 (6) of Act 220
Western Hardwood Enterprises Ltd. v. West
African Enterprises Ltd [1998-99] SCGLR 105 Asante v. K. Compu Services Ltd. [2001-2002] 1 GLR 562 (Appau J.) Interplast v. Bonsu [1979] GLR 285
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TERMINATION OF LEASES 11 Surrender Yielding up by the lessee of the residue of the leasehold interest to the lessor. The leasehold interest and the reversion thereby merges in the landlord and the lease is extinguished. KAG - FLAW 210- IMMOVABLE PROPERTY II - TERMINATION OF LEASES 12 Merger Union of the lease and the reversion in the lessee. The lease is thereby extinguished.
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TERMINATION OF LEASES 13 Frustration??? The general principle is that leases cannot be frustrated. There is therefore the need for the parties to insure their interests to cater for any ‘frustrating’ events. The parties may also put in the agreement clauses that may lead to the suspension of obligations in case certain unforeseen events happen. Iddrisu v. Attorney-General [2001-2002] 1 GLR 608 National Carriers Ltd. v. Panalpina (Northern) Ltd. [1981] AC 675; 1 All ER 161 KAG - FLAW 210- IMMOVABLE PROPERTY II - TERMINATION OF LEASES 14 Rent Act – Restrictions on recovery of possession For all premises that are subject to the Rent Act, for a Landlord to recover possession of the leased premises, he must, in addition to his right to terminate under common law or any other enactment, find an additional ground under S. 17 of the Rent Act. KAG - FLAW 210- IMMOVABLE PROPERTY II - TERMINATION OF LEASES 15 Premises subject to Rent Act Section 1(1) states that the Act applies to all premises in Ghana but subject to the exceptions in section 1 (2) which include Public officer being a tenant with the government as landlord; Lease of bare land or lease of premises which was demolished and another constructed within five years of the lease; Tagoe v. Mobil Oil (Gh) Ltd. [2003-2005] 1 GLR 459, CA
Concessions;
Government buildings rented out but which have been
certified by the Minister that it yields no financial gain to the government; Market stalls owned by Councils or local authorities; etc. KAG - FLAW 210- IMMOVABLE PROPERTY II - TERMINATION OF LEASES 16 Grounds for recovery of possession under the Rent Act – section 17 Section 17 (1) (a) – Arrears of rent for one month or more; subject to subsection 4 Chas-Ocloo v. Kyei (1989-90) GLRD 11 Osekre v. Saah [1967] GLR 144
Section 17 (1) (b) – Breach of an obligation of the tenancy
with the exception of rent; Dahabieh v. SA Turqui [2001-2002] 1 GLR 171 (SC)
Section 17 (1) (c) – Nuisance by tenant or any person
residing with tenant; Ofori v. Arthur Dennis v. Agbetetei Mensah v. Addison [1981] GLR 784
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TERMINATION OF LEASES 17 Section 17 Section 17 (1) (d) – Conviction for the use of or conviction for allowing premises to be used for immoral or illegal purpose; (d) Section 17 (1) (e) – Deterioration of premises as a result of waste caused by tenant or any person residing with tenant; Section 17 (1) (f) – Tenant giving notice of intention to quit and landlord based on that notice contracted to sell or let the premises to another person.
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TERMINATION OF LEASES 18 Section 17 Section 17 (1) (g) – Premises required by landlord for personal occupation as a dwelling house by himself, a member of his family or a person in his whole time employment; Saka v. Lokumal [1991] 1 GLR 312 Owusu v. Asante [1973] 2 GLR 220
Nimako v. Archibald [1966] GLR 612
Adu v. Clegg [1981] GLR 173
Gbedemah v. Ofori [1991] 1 GLR 345
KAG - FLAW 210- IMMOVABLE PROPERTY II - TERMINATION OF LEASES 19 Section 17 Section 17 (1) (h) Lease expired and the landlord reasonably requires the premises for his own business purposes; not less than six months’ notice in writing to tenant of Landlord’s intention to apply for an order for recovery of possession; Larbi v. Acquaah (1980) GLR 629 Barnor v. Appah (1989-90) GLRD 38 Allamedine v. PZ Dankwa v. Anokwa (1989-90) GLRD 78 John Lawrence Chemists Ltd. v. Obeng-Ansong [1995- 96] 1 GLR 146
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TERMINATION OF LEASES 20 Section 17 Section 17 (1) (i) Where tenant has ceased to be in employment of landlord if premises was let by reason of employment; Haroutunian v. Medz-Moroukian [1962] 2 GLR 94 Ampomah v. VRA Section 17 (1) (j) Where landlord personally in occupation and let premises substantially furnished for a term during his absence and has returned and requires the premises for his re-occupation. KAG - FLAW 210- IMMOVABLE PROPERTY II - TERMINATION OF LEASES 21 Section 17 Section 17 (2) Lease expires, tenant a statutory tenant and landlord Intends to pull down the premises and construct new premises; Intends to remodel the premises; subject to section 18 Requires premises to carry out a scheme of redevelopment; not less than 6 months’ notice Asamoah v. Zwennes [1980] GLR 867 Seraphim v. Pacific Stores [1974] 1 GLR 301 Osei v. Anokye [2007-2008] SCGLR 463 Condition that if no such redevelopment is carried out within a reasonable time, tenant should be reinstated as a statutory tenant; Duty on tenant to monitor the progress of work. Osei v. Anokye
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TERMINATION OF LEASES 22 Statutory Tenant Section 36 defines a statutory tenant as a tenant who Remains in possession of premises after the determination by any means of the tenancy and cannot by reason of Act 220 be deprived of possession by the Landlord; or On the commencement of Act 220 is in possession of premises of which the tenant retained possession prior to the commencement by virtue of any enactment repealed by Act 220; or Is a tenant by virtue of section 17 (7)
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TERMINATION OF LEASES 23 Statutory Tenant – Rights and Obligations Holds the premises as a tenant from month to month on the same terms and conditions as the expired tenancy; Section 29 of Act 220 a statutory tenant cannot therefore sublet without the prior consent of the landlord. Section 22 of Act 220 Dahabieh v. S. A. Turqui Dhalomal v. Puplampu Osekre v. Saah May determine the tenancy by a notice as in a monthly tenancy; Landlord has a right of distress for arrears of rent. Statutory Tenant cannot demand a premium as an inducement to give up possession; Section 28 of Act 220
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TERMINATION OF LEASES 24 Offences Section 25 – general offences; Demanding or receiving more than recoverable rent; Demanding premium; Receiving more than 5% of recoverable rent for a year as an agent; Demanding more for furniture, fittings or fixtures where such articles are conditions for grant; Enters into any agreement with the intention of defeating purpose of the Act; Fails to furnish information required to be furnished as a LL under the Act; KAG - FLAW 210- IMMOVABLE PROPERTY II - TERMINATION OF LEASES 25 Offences Ejecting tenant for failing to pay more than recoverable rent; Failing to reinstate tenant after remodeling premises contrary to section 18; Contravenes any provision of the Act. Charges a rent advance of more than six months – section 25(5) Section 27 – inducing tenant to quit by doing an act or refraining to do an act; Section 28 – demanding of premium by statutory tenant. KAG - FLAW 210- IMMOVABLE PROPERTY II - TERMINATION OF LEASES 26