If you make this agreement your tenant will not bother you!

• Follow

When you rent a house, you often hear about the rent agreement or lease agreement. You may have made it many times. Most people consider it paperwork. Meaning, the agreement has been made. Witnesses have signed it, you give the key to the tenant and put the house on rent. The story is not that simple. Because many times people have got into disputes. In such a situation, a Leave and Licence Agreement can come to your help. What is a Leave and Licence Agreement. Why should a Leave and Licence Agreement be made instead of a rent agreement? Let’s find out.

When the landlord rents out the house through a rent agreement, he legally gives possession of the house to the tenant for a fixed time. This means, for a fixed time, the tenant gets legal rights of the possession of the property.

This is not the case in a Leave and License Agreement. The Leave and License Agreement comes under the Indian Easements Act, 1882. Here, the landlord only gives the tenant the right to use his property. It is written in the Leave and License Agreement that no possession is being given to the tenant. He can only use your property. This means, the possession of the house i.e., control will remain with the landlord.

The process of making a Leave and License Agreement and rent or lease agreement is exactly the same. You just have to consider mentioning certain things in the agreements. Like you use the term ‘Leave and License Agreement’ in the title instead of rent or lease agreement. Instead of Landlord or Lessor, you use ‘Licensor’. instead of Tenant or Lessee, you use ‘Licensee’. Not only this, you will have to write license fees instead of rent in the agreement.

Venket Rao, the founder of Intygrat Law, says, that the Rent Control Act is in effect in many states… Rent or lease agreements can fall under the Rent Control Act. Most of rights are in favour of tenants… In such a situation, if you make a Leave and License Agreement, you will stay out of the purview of the Rent Control Act. So, as a landlord, you will avoid many complications.

In a Leave and License Agreement, the agreement ends automatically upon the death of the licensor or licensee… This is not the case in a rent agreement or lease agreement. In this, after the death of the person to whom the house was rented, his legal heirs will continue to live on rent. They cannot be evicted just because the person in whose name the lease was made has died.

If you have rented a property via a license agreement and you sell the property then the Leave and License Agreement will expire. On the other hand, if a property rented through a rent agreement is sold, the person buying the property will be obliged to accept the rent agreement as well. Selling the property does not end the rent agreement.

Similarly, in a license agreement, the licensor i.e., the landlord who has given someone else license i.e., right to use the property cannot inturn give license to a third person to use the property. On the other hand, in a rent agreement, a tenant can only rent out to a third person when it is written in the agreement that he will not sub-lease to a third person.

You must have understood why a Leave and License Agreement is necessary. As long as the tenant lives honestly there is no problem. But if he becomes dishonest. The matter reaches a point where litigation can be made then having a Leave and License Agreement makes it easier for the licensor to take back his property. It can be an effective mechanism to prevent home seizure by tenants. So, if you are going to rent out your house then use ‘Leave and License Agreement’ instead of ‘Rent Agreement’ in your title.