Think of a driver`s license or a liquor license: these are certificates that give you the legal right to do something. With a license, the licensee has permission to perform a specific action on the owner`s property. While a lease gives you the right to control the property, a license gives specific permission to respond to it. Typically, a lease transfers exclusive ownership of a particular property against payment of rent and transfers ownership to the tenant for the duration of the lease. Lawyers for tenants whose clients are in arrears with a bona fide license agreement can no longer guarantee that an eviction order will be deferred for up to six months. If their licensed customers do not remedy their failure, customers are quickly and easily subjected to peaceful self-help expulsion from authorized premises. Owners no longer eagerly forego their income and outstanding funds to ensure the recovery of ownership of the premises at any given time. The bargaining lever will shift in favor of the owner-licensor, who can either demand full payment from the defaulting licensee if he wants to avoid eviction, or demand peaceful ownership of the premises with the full support of the law. For homeowners frustrated with the right facts and properties using the latest computerized entry systems, this is a long-awaited revolution.

A final consideration is that a party cannot convert a lease into a licence by simply calling it that; the terms of the agreement and the nature of the control are the most important determining factors. There may be a gray area from time to time, but usually the division is easy to see if considered correctly. Learn more about how landlords can use licenses instead of leases here Home / Published Articles / Tenant Licensees, Licensees, Landlords-Licensors, New York Eviction Process, Owner-Tenant Process, Good Faith License Agreement / Use of a License Agreement Instead of a lease Subject to the terms of the agreement, a lease is not revocable by the landlord. If you have a one-year lease, the landlord cannot revoke your right to the land after six months without breaking the contract. However, a license is revocable. In this case, the neighbor can tell you at any time that you are no longer allowed to climb his tree. Therefore, careful drafting of appropriate licensing agreements is necessary and, to this end, there must be close cooperation between lawyers and their clients who wish to implement a licensing regime. It is essential to communicate with the client about the risks and benefits of using a licensing regime.

In addition, lawyers must pay close attention to the client`s objectives and determine how many acquisition costs the client is willing to accept in order to provide the type of “full service” agreement that passes a court`s “licensing test”. Wendy represents clients in Illinois and Wisconsin in various real estate and real estate financing transactions. In addition to managing acquisitions, divestitures and leases, Wendy also advises lenders on credit transactions, credit adjustments, loan restructurings, forbearance and pre-seizure matters. If you need help with a related topic, contact Wendy. Licenses, on the other hand, do not always require a written agreement to be binding. In fact, a license can be granted to a party without either party ever meeting. For example, if you purchase a ticket to a sporting event, purchasing that ticket gives you a license to enter a sports venue and use a seat on that venue for a predetermined period of time. You have not met the seat holder, but the purchase of the ticket is a binding agreement between you and the holder. You will have permission to use the seat, but you do not own the seat, and there are certain rules you must follow regarding your conduct at that seat if you want to comply with the terms of the license. For a number of its buildings, it has unveiled a new type of office space for small tenants who need smaller spaces. According to his design, a tenant would have a specific office and would share a photocopier, fax machine, kitchen, and conference rooms. Furniture, carpets, phones, computers and coffee would be provided by the owner.

The rooms would be pre-built. The tenant would only have to bring a pencil to be able to work. The Advocate General asked whether it was possible to use a license agreement in which he could change the locks or, in this case, turn off the key cards in the event of a tenant`s default. Our firm`s mission was to draft an enforceable license agreement that provides for self-help without having to resort to litigation. This article explains the license agreement, its limits, and its powers. It also dissects and explains when and how to use a license agreement, and the ability to properly perform self-help. A commercial lease grants the tenant exclusive use of a property for an agreed period of time. This is usually a minimum of 30 days. During this time, the tenant is responsible for the maintenance of the property. Under the terms of the agreement, you have the right to exclude any person, including the owner, from access to the property. To determine the difference between a license and a lease, let`s take a look: self-help is not inaccessible to New York owners who reserve the right to use it in their leases.

However, courts are generally hostile to a landlord`s use of self-help and will not approve its use if the rental terms are unclear or if there is a factual issue about whether or not the lease expires. In addition, under the New York Real Estate Actions and Procedures Act (“RPAPL”) § 853, if a tenant is forcibly or unlawfully excluded from the real estate, the tenant may receive a triple of damages from the landlord and may also be reinstated if excluded before the end of the rental period. Only if a court finds that restoring the tenant`s property would be “unnecessary” because the landlord will prevail in a summary proceeding against the tenant`s exclusion is it unlikely that the court will order the tenant to restore the premises. During my travels over the years, I have encountered cases where business people have confused the distinction between a lease and a permit. The distinction is important because the rights and obligations of the parties can vary greatly depending on how the true relationship is determined. A lease gives exclusive ownership of the premises. The difference between a lease and a tenancy is that a tenancy is a residential property rather than a commercial property. Whether you choose a lease or a license depends on your business and its needs. Understanding the differences between them won`t help you make mistakes and ultimately save you money. In addition, the Illinois Supreme Court has held that “licenses are generally revocable at the will of the grantor and generally ineligible.” But once again, the court drew attention to the crucial distinguishing feature of a lease: “the transfer of ownership and control of the property to a tenant for the agreed term.” The parties can enter into contracts on revocation and termination issues, which makes the efficient drafting and negotiation of license agreements extremely important. Remember that whoever drafts the contract has the power, and if you sign a contract that someone else has prepared, careful consideration and negotiation of the terms is an essential investment in the success of your business.

Initially, simply labeling a contract as a “license agreement” or a “lease” does not mean that. Our courts will review the terms of the agreement to determine whether it is a licence or a lease. Although the distinction is sometimes difficult to discern, the consequences of an error can be significant. For example, if a landlord simply locks in a business that they believe is a licensee, but is actually a tenant, the tenant has potential claims against the landlord for a number of causes of action, including, but not limited to, illegal eviction, trespassing, and breach of contract. A license does not always require a written agreement. A license can be granted without the owner and licensee ever meeting. For example, you buy a ticket to a football match. The ticket is a license issued by the stadium owner that allows you to enter the stadium. Although you have never met or negotiated with the owner, you accepted the license when you purchased the ticket.

For commercial leases and residential leases, you may be charged rent. This is a monthly payment that secures your interest in the property. You accept the amount when you sign the lease and it must not vary from month to month. Whether the agreement is called a “rental agreement” or a “license agreement,” the test of whether the law considers an agreement to use real estate as a license or lease is whether the agreement gives you exclusive ownership of the premises “against the whole world, including the owner.” If so, you have a lease. .