We have been discussing the legal aspect of renting a house; we have talked about the tenancy agreement which led us into the different types of covenants involved. Our last discuss was on Implied covenants; this article will be focused on Express and Usual covenants. For express covenants, these are covenants that are agreed upon between the parties to the lease agreement. The parties may either agree to do or not to do certain acts. These covenants are:
- Covenant to pay rent: Although this is an implied covenant, most lease agreements expressly provide for tenant’s covenant to pay rent. In this covenant, the parties agree on the amount payable as rent. Various states in Nigeria have enacted legislations to regulate the rent chargeable and the landlord is advised not to charge rents above what the law stipulates.
An important thing to note about the Express Covenant is that once it is fixed, neither of the parties can unilaterally increase nor reduce the rent during the period of the term granted. The covenant to pay rent is enforceable against the tenant by an action for re-entry and forfeiture, and where the landlord is in breach of the rent control law, the tenant may apply to court for the determination of the rent to be paid.
If the agreement contains a clause that states ‘the tenant shall not make any deductions from rent payable’, the right of the tenant to deductions cannot be excluded by the mere clause stated above. This means that your landlord cannot prohibit your right as a tenant to claim a deduction from rent, merely because it states so in the clause of the agreement.
- Covenant to pay rates, taxes, and other outgoings: To avoid disputes, the agreement should state the party to pay the rates and taxes chargeable on the property. However, there are times in which the statute establishing the rates and taxes provide for who is liable to pay. This is subject to the expressed intention of the parties; thus, either the landlord or tenant may covenant to pay rates and taxes. A major conflict with this covenant is whether the party that is liable to pay the outgoings is also liable to pay all new and future rates and taxes but the case of Mile End Old Town Vestry v Whitby (1886) 78 L.T. 80 clears this up. The court held that the party to pay the outgoings is not bound to pay the subsequent new rates and taxes unless it is of the same specie as the rates and taxes charged in the first instance.
- Covenant against assignment and subletting: Where the tenant allows his relative spend some time in the leased property, it is not deemed as an assignment or sublet because the relative does not have a legal interest in the property. This covenant has to be expressly stated that ‘…the tenant shall not assign or sublet…’ for it to be enforceable.
There are four possible situations under this covenant. The first is where the lease is silent on assignment and sub-letting, in which case, the tenant has the right to do so without seeking and obtaining any consent from the landlord. The second situation is where the lease contains an absolute covenant against assignment or sub-letting by stating ‘Not to assign, sub-let, charge or part with possession of demised premises or any part of it…’ This is clearly not favorable to the tenant who may desire to assign or sub-let the leased premises. In this situation, the tenant can negotiate for an amendment to the clause in his favor.
The third situation is where the lease allows the tenant to assign but with the written consent of the landlord. For instance, ‘Not to assign, sub-let, charge or part with possession of demised premises or any part of it without the written consent of the landlord on every occasion first obtained.’ Here, the landlord is not under obligation to disclose the reason for his refusal of consent so the tenant should negotiate further to amend and control the power of the landlord’s refusal. In the fourth and last situation, where the lease states: ‘Not to assign, sub-let, charge or part with possession of demised premises or any part of it without the written consent of the landlord on every occasion first obtained and consent not to be unreasonably withheld in the case of responsible and respectable persons.’, the landlord, in this case, cannot refuse consent unreasonably except for reasons known to law. The tenant must formally request for the landlord’s consent and the request must be made within a reasonable time to enable the landlord decide whether or not to give consent.
- Covenant to repair: This Express Covenant is usually a cause of conflict between the landlord and tenant because the landlord wants to protect the property against waste or damage and the tenant wants to enjoy the property in quiet possession and habitable condition. Thus, both parties must agree on the specifics concerning this covenant. The covenant must be drafted to permit the landlord enter the tenant’s premises to inspect and repair at reasonable times. The landlord should also serve notice on the tenant to perform his obligation to repair. This goes both ways as the tenant can also serve notice to the landlord to enter the premises, inspect and repair.
- Covenant against alteration: This covenant covers acts such as breaking or partitioning the wall, changing the structure of the premise and the likes. This covenant is similar to the tenant’s covenant not to commit waste but it must be read along with the user covenant in the lease because if the tenant changes the structure of the property or causes an alteration for the purpose for which the premises was leased, it is not deemed as a breach of covenant against alteration. For example, a property is leased for the purpose of habitation and the tenant wishes to install a burglar proof and air-conditioners and as a result, changes some of the structures of the premises. In this case, there is no breach of this covenant as it is a reasonable alteration
- User covenant: The landlord cannot permit a property to be used for a purpose contrary to the planning scheme; residential areas cannot be used for business purposes. If the landlord is aware at the time of letting the premises that the lease is to be used for illegal purposes or contrary to the government’s planning scheme, the lease will be unenforceable. The exercise of control of land is done by two means: certificate of occupancy issued under the Land Use Act, 1978 and the town and country planning authorities in each state, who designs scheme to control and keep in order the development of land.
- Express Covenant to Insure: This covenant serves to insure the property against the risk of loss from fire, floods and other risks. A well drafted insurance covenant should provide: Who will insure, The identity of the insurance company, the risks to be covered, the amount of the cover and how money paid under the policy shall be applied. The tenant may covenant to insure the property, in a long lease, either in his own name or jointly with the landlord. If it is the latter, it will be a breach of covenant, to insure in the name of one part only. If it is the landlord alone that covenants to insure, it will be a breach if the tenant’s name is added.
- Covenant to deliver possession at the expiration of the term granted.
USUAL COVENANTS
Usual covenants are not easily determined but what is certain is that it must be reasonable. If the landlord’s demands are unreasonable, the court will refuse such demands as usual. Usual covenants are those covenants that are proper and common in a lease, based on the facts or evidence presented before the court. In deciding what covenants are usual, the court pays regard to the general conveyancing practice, the type of lease in question, the custom of the locality in which the property is situated, the purpose and usage of trade for which the property is let and other prevailing circumstances.
The following covenants have been held to be usual covenants in a lease:
- covenant of the lessor for quiet possession of the property
- covenant of the lessor that the property is fit for habitation
- covenant of the lessee to pay rent
- covenant of the lessee not to commit waste of the property and
- covenant of the lessee to use and keep the premises in a tenantable condition
These covenants have been explained above and in the previous article and if any of these covenants are in breach, the party that suffers loss or damage has the right to take the matter to court if it cannot be settled amicably. The information stated above is not exhaustive so it is wise to always seek the legal advice of lawyer for more information and guidance.
