Be­fore sign­ing a lease deed... is the lessee’s right to know and the lessor’s duty to dis­close de­fects of the prop­erty

HT Estates - - NEWS - Su­nil Tyagi

Giv­ing and tak­ing up a prop­erty on lease is a com­mon trans­ac­tion. The Trans­fer of Prop­erty Act, 1882 (TPA), lays down the nu­mer­ous rights and re­spon­si­bil­i­ties that lessors (land­lords) and lessees (ten­ants) have to­wards each other. When en­ter­ing into a lease — as a lessor or a lessee — know­ing th­ese ba­sic covenants can help par­ties ne­go­ti­ate the terms of the lease. It is im­por­tant to know that th­ese covenants are im­plied in na­ture — in other words, they ap­ply in the ab­sence of a con­tract to the con­trary be­tween the par­ties.

Lessee’s rights/lessor’s re­spon­si­bil­i­ties

It is the right of the lessee to have phys­i­cal pos­ses­sion of the premises that s/he is tak­ing up on lease. At the time of ex­e­cu­tion of the lease, the lessor should en­sure peace­ful, phys­i­cal han­dover of the prop­erty to the lessee.

Dur­ing the en­tire term of lease, the lessor is not en­ti­tled to ob­struct, hin­der or un­duly in­ter­fere with the lessee’s quiet and peace­ful pos­ses­sion and en­joy­ment of the premises. How­ever, the lessor (be­ing the owner of the prop­erty) has the right to re­strain the lessee from us­ing the prop­erty in an un­law­ful man­ner or in a man­ner which con­tra­dicts the terms of the lease deed. Be­fore sign­ing a lease, it is the lessee’s right to know and the lessor’s duty to dis­close ma­te­rial de­fects of the prop­erty. For ex­am­ple, a de­fect in the lessor’s ti­tle of own­er­ship of the prop­erty is a ma­te­rial de­fect which ought to be dis­closed by the lessor, be­fore ex­ecu- tion of the lease deed. In the event the lessor de­lib­er­ately sup­presses such vi­tal in­for­ma­tion, the lessee may ei­ther claim dam­ages, re­scind the lease con­tract, or en­force spe­cific per­for­mance of the con­tract. Lessee must en­sure there is an ex­press clause stat­ing that the lessor will be re­spon­si­ble for car­ry­ing out re­pairs. If, de­spite a spe­cific pro­vi­sion, the lessor does not make the re­quired re­pairs, the lessee may make need­ful re­pairs and deduct the cost from the rent payable to the lessor. How­ever, re­pairs can be made by the lessee only af­ter a no­tice is sent to the lessor in this re­gard and the lessor’s con­sent is re­ceived, or if no con­sent is re­ceived, within rea­son­able time. Where the con­tract has no ex­press pro­vi­sion re­gard­ing re­pairs, it is the lessee’s re­spon­si­bil­ity to carry out re­pairs at his/her own costs and ex­penses. It is the lessor’s duty to

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