Understanding property contracts
Renting, leasing or buying a commercial property? Make sure you fully understand the contract with this plain English definition of property contract terms.
Break clause - a clause that allows a tenant to end a lease at specific times during the period of the lease.
Conveyance - a deed that conveys property rights.
Covenant - a promise within a contract for the performance or non-performance of a specified act.
Deed - a written document by which a person transfers ownership of real property to another. A deed must be properly executed and delivered in order to be effective.
Disclaimer - a written document denying legal responsibility, or a limitation of rights that might otherwise be claimed.
Easement - an interest in land owned by another that entitles its holder to a specific limited use or enjoyment eg the right to cross the land, or to continue to have an unobstructed view over it.
Encroachment - when a building or some portion of it, or a wall or fence, extends beyond the land of the owner and illegally intrudes upon that of an adjoining owner.
Equity - the monetary value of a property after any claims, such as a mortgage, are taken away.
Eviction - the dispossession of a tenant of leased property by force or through the legal process.
Exchange - the exchange of agreed, signed contracts. The transaction between the seller and the buyer is then legally binding, and completion - including the final transfer of money - usually takes place two to four weeks later.
Fixture - a permanently fixed piece of furniture or equipment incorporated into a property. Removing it would cause damage to buildings or land, and is therefore regarded as legally part of it.
Freehold - outright ownership of a property. This type of tenure contrasts with leasehold where the leaseholder has the rights to occupy a property for a specified period of time.
Habitable - suitable and fit for a person to live in and free of any faults that might endanger the health and safety of occupants.
Holdover Tenancy - a tenancy that arises when someone remains in possession of a property after the expiration of the previous tenancy and is recognised by the landlord by accepting rent.
Indenture - a deed or other document to which two or more parties are bound.
Invitee - a person, such as a customer, who is present in a place either by the express or the implied invitation of the occupier. This normally means that the occupier has to exercise reasonable care to protect the safety of the invited person.
Landlord - the owner of property that is leased or rented to others.
Lease - a contract by which an owner of property conveys exclusive possession and use of it for a specified rent and for a specified period - after which the property reverts to the owner.
Legal duty - the responsibility to others to act according to the law.
Loss of use - circumstances where a property cannot be occupied in the normal way, through the negligence or wrongdoing of another party.
Notice to quit - a notification or communication to a tenant to leave specified premises usually for a breach of terms of the lease.
Occupancy - holding, possessing, or occupying premises.
Occupant - someone who occupies a particular place.
Partition - the division into parts of property held jointly, or the sale of such property by a court with division of the proceeds.
Party wall - a wall that divides two separate premises, which is the joint responsibility of both owners.
Premises - a building or part of a building usually including the adjacent grounds.
Quit - for a tenant to move out of rented premises.
Reasonable wear and tear - damage sustained in the course of normal use.
Repossess - to take possession again of a property or goods after non-payment of money owed. This might follow a court order.
Search - an inspection carried out to establish whether any legal restraints, planning applications or aspects of legal ownership might affect the purchase of a property. Solicitors will look into land registry and local government records when pursuing this.
Sublease - a lease that is given by a tenant of part or all of the leased premises, to another person for a period shorter than the original lease, while still retaining some interest.
Tenancy - the temporary possession or occupancy of property that belongs to another. It also refers to the period of a tenant's possession.
Tenure - the way in which a property is held, eg freehold tenure or leasehold tenure.
Trespass - a wilful act or active negligence that causes an injury to a person or the invasion of their property.
Vendee - the person to whom a property is sold.
Vendor - the person who is selling a property.
Based on an article by BusinessLink
Understanding property contracts
Renting, leasing or buying a commercial property? Make sure you fully understand the contract with this plain English definition of property contract terms.
Break clause - a clause that allows a tenant to end a lease at specific times during the period of the lease.
Conveyance - a deed that conveys property rights.
Covenant - a promise within a contract for the performance or non-performance of a specified act.
Deed - a written document by which a person transfers ownership of real property to another. A deed must be properly executed and delivered in order to be effective.
Disclaimer - a written document denying legal responsibility, or a limitation of rights that might otherwise be claimed.
Easement - an interest in land owned by another that entitles its holder to a specific limited use or enjoyment eg the right to cross the land, or to continue to have an unobstructed view over it.
Encroachment - when a building or some portion of it, or a wall or fence, extends beyond the land of the owner and illegally intrudes upon that of an adjoining owner.
Equity - the monetary value of a property after any claims, such as a mortgage, are taken away.
Eviction - the dispossession of a tenant of leased property by force or through the legal process.
Exchange - the exchange of agreed, signed contracts. The transaction between the seller and the buyer is then legally binding, and completion - including the final transfer of money - usually takes place two to four weeks later.
Fixture - a permanently fixed piece of furniture or equipment incorporated into a property. Removing it would cause damage to buildings or land, and is therefore regarded as legally part of it.
Freehold - outright ownership of a property. This type of tenure contrasts with leasehold where the leaseholder has the rights to occupy a property for a specified period of time.
Habitable - suitable and fit for a person to live in and free of any faults that might endanger the health and safety of occupants.
Holdover Tenancy - a tenancy that arises when someone remains in possession of a property after the expiration of the previous tenancy and is recognised by the landlord by accepting rent.
Indenture - a deed or other document to which two or more parties are bound.
Invitee - a person, such as a customer, who is present in a place either by the express or the implied invitation of the occupier. This normally means that the occupier has to exercise reasonable care to protect the safety of the invited person.
Landlord - the owner of property that is leased or rented to others.
Lease - a contract by which an owner of property conveys exclusive possession and use of it for a specified rent and for a specified period - after which the property reverts to the owner.
Legal duty - the responsibility to others to act according to the law.
Loss of use - circumstances where a property cannot be occupied in the normal way, through the negligence or wrongdoing of another party.
Notice to quit - a notification or communication to a tenant to leave specified premises usually for a breach of terms of the lease.
Occupancy - holding, possessing, or occupying premises.
Occupant - someone who occupies a particular place.
Partition - the division into parts of property held jointly, or the sale of such property by a court with division of the proceeds.
Party wall - a wall that divides two separate premises, which is the joint responsibility of both owners.
Premises - a building or part of a building usually including the adjacent grounds.
Quit - for a tenant to move out of rented premises.
Reasonable wear and tear - damage sustained in the course of normal use.
Repossess - to take possession again of a property or goods after non-payment of money owed. This might follow a court order.
Search - an inspection carried out to establish whether any legal restraints, planning applications or aspects of legal ownership might affect the purchase of a property. Solicitors will look into land registry and local government records when pursuing this.
Sublease - a lease that is given by a tenant of part or all of the leased premises, to another person for a period shorter than the original lease, while still retaining some interest.
Tenancy - the temporary possession or occupancy of property that belongs to another. It also refers to the period of a tenant's possession.
Tenure - the way in which a property is held, eg freehold tenure or leasehold tenure.
Trespass - a wilful act or active negligence that causes an injury to a person or the invasion of their property.
Vendee - the person to whom a property is sold.
Vendor - the person who is selling a property.
Based on an article by BusinessLink