Chapter 4 - Contract of Sales and Leases

Executed Contract

An agreement that has been fully performed.

Leasee

A person to whom property is rented under a lease.

option

A right given for consideration to purchase or lease a property upon specified terms within a specified time.

Ground Lease

An agreement in which a tenant is permitted to develop a piece of property during the lease period, after which the land and all improvements are turned over to the property owner.

Bilateral Contract

a contract involving mutual promises (each party is both promisor and promisee)

Estate at Will (Tenancy at Will)

gives the tenant the right to possess property for an indefinite or uncertain time( must give a 30 day notice )

Land Lease

A land lease--also called a ground lease--is a lease agreement that permits the tenant to use a piece of land owned by the landlord in exchange for rent.

Option to Renew

A clause in a lease that outlines the terms for renewing or extending an original lease agreement.

expressed contract

A contract in which all elements of a contract are specifically stated ( offer , acceptance , consideration ) and the terms are stated as compared to an " implied" contract in which the existence of the contract is assumed by the circumstances.

executory contract

A contract that has not yet been fully performed. ( fully executed )

lease

A contract whereby, for a consideration, usually termed rent, one who is entitled to the possession of real property transfers such right to another for life, for a term of years or at will.

Proprietary Lease

A lease given by a corporation to another. It is often used in a co-op context, where the owner is given a certain number of shares in the co-op, along with a proprietary lease for one of the residences in the building.

Triple Net Lease

A lease in which the tenant or lessee is responsible for paying a portion of or all of the common expenses related to real estate ownership, in addition to base rent.

Percentage Lease

A lease of property in which the rental is based upon the percentage of the volume of sales made upon the leased premises, usually provides for minimal rental.

Net Lease

A lease that requires the tenant to pay, in addition to rent, some or all of the property expenses that normally would be paid by the property owner. These include expenses such as real estate taxes, insurance, maintenance, repairs, utilities, and other items.

Index Lease

A lease tied to an index such as the Consumer Price Index.

Gross Lease

A lease which provides for a graduated change at stated change at stated intervals in the amount of the rent to be paid ; used largely in long-term leases.

Graduated Lease

A lease which provides for a graduated change at stated intervals in the amount of the rent to be paid; used largely in long-term leases.

eviction

A legal proceeding by a lessor landlord to recover possession of real property.

Implied Contract

A legal substitute for a contract. An implied contract is an agreement created by actions of the parties involved, but it is not written or spoken. This is a contract assumed to have been drawn.

security deposit

A monetary deposit given to a lender, seller or landlord as proof of intent. Can be refundable or non refundable depending on terms of transaction.

Unilateral Contract

A one-sided contract wherein one party makes a promise so as to induce a second party to do something. The second party is not legally bound to perform; however, if the second party does comply, the first party is obligated to keep the promise.

Holdover Tenant ( tenancy at sufferance )

A tenant who remains in possession of a property after expiration of the lease term.

Covenant

Agreements written into deeds and other instruments promising performance or non- performance of certain acts or stipulating certain uses or non- uses of the property.

Periodic Lease

Also known as a tenancy from year to year, month to month, or week to week, is an estate that exists for some period of time determined by the term of the payment of rent.

Sublease

An arrangement in which the lessee (tenant) in a lease assigns the lease to a third party, thereby making the old lessee the sublessor, and the new lessee the sublessee, or subtenant.

Constructive Eviction

Any disturbance of the tenant's possession of the leased premises by the landlord whereby the premises and rendered unfit or unsuitable for the purpose for which they were leased.

Installment sales contract

Is a contract between a seller and buyer of real property in which the seller provides financing to buyer to purchase the property for an agreed upon purchase price and the buyer repays the loan in installments.

Lessor

One who rents property to another under a lease.

Leasehold Estate

The interest or estate which a lessee of real estate has therein by virtue of the lessee's lease.

assignment

The method or manner by which a right or contract is transferred from one person to another.

Quiet Enjoyment

The right of an owner or lessee legally in possession of property, to uninterrupted use of the property without interference from the former owner, lessor or any third party claiming superior title.

Actual Eviction

Where one is either by force or by process of law, actually put out of possession.