However, when a license is used for commercial purposes, licensees, persons who use the property of others under a license are often referred to as residents or guests. Not tenant. Due to a noticeable precedent of potential landlords and residents trying to circumvent the rigid and often tenant-friendly provisions of the residential or commercial tenancy code, there has been a movement towards litraires. Conclusion: whether a transaction is a rental or a license, the dominant test is the intention of the parties. In the license, the licensee has the right to use the premises that have no rights and interests. However, in the rental agreement, the lease has the right to enjoy the property and property to the extent that has been transferred to the tenant. In Associated Hotels of India Ltd. v. R.N.
Kapoor (AIR 1959 SC 1262), the Supreme Court referred to the difference between a lease and a license: when the property is transferred to leased land, it is subject to the rights granted in the leases related to the property. New landlords may not distribute a tenant, increase rent or impose other financial obligations outside the scope of the relevant document. While the gaps can sometimes seem vague there, there are obvious effects if you follow one route unlike the other. The fundamental differences between a lease agreement and a license are outlined below. The essential element of both forms of the legal relationship is the granting of a right to use the premises in a certain way. One of the main legal differences that should be mentioned here is that a lease agreement grants a stake in land that gives a tenant exclusive ownership and guarantee of the property, while a license is a more adaptable agreement and cannot offer the lessee the same title guarantee as a lease. A fundamental difference between a lease and a license agreement is that only a lease can grant the right to exclusive ownership of land or premises. Here, the tenant has permission to use and occupy the premises exclusively. You also have the right to exclude others from the premises (including the owner).
When you settle in premises, it is always better to get a lease. However, a lease may not be economically viable, for example because the premises are shared with others and, therefore, exclusive ownership is not feasible. Other examples where licensing may be satisfactory or the only option you have: If you can`t determine if your agreement is a rental agreement or a license, an experienced owner-tenant lawyer can help. The difference between leasing and licensing is the difference between two different legal concepts that relate to a person`s obligations and rights in a contract. Read 3 min In the following circumstances, entering into a lease is preferable to entering into a license: In another case in 2017, that of Watts v Stewart , Ashtead United Charity gave Ms. Watts a dwelling in one of her real estate, namely a house of alms. . .