Tenancy at Will

The practical significance is what happens next, and it usually is not a tenancy at will for long.

Where the occupier begins paying rent by reference to a period, and the owner accepts it, a periodic tenancy commonly arises: monthly where rent is paid monthly, yearly where it is paid yearly. That periodic tenancy then carries the notice requirements that go with it.

That conversion is the point both sides need to understand.

A landlord who allowed somebody into occupation while a lease was negotiated, and then accepted a year's rent, may have created a yearly tenancy requiring six months notice to determine rather than an arrangement they could end at will.

An occupier in the same position has gained protection they did not have.

The safe course for a landlord is to document the arrangement expressly: that occupation is permitted pending completion of the lease, on stated terms, that any payment is not accepted as rent under a periodic tenancy, and that either party may end it on stated notice.

The safer course still is not to allow occupation before the document is signed.

Two Nigerian situations produce this arrangement constantly.

The first is occupation before signing. A business needs premises urgently, the landlord agrees they can move in while the lease is finalised, and the fit out begins. Weeks become months, the lease is never signed, and the parties then disagree about what was agreed. The occupier says a lease was agreed on the terms discussed. The landlord says there was no lease. What actually exists is a tenancy at will, possibly converted by rent payments into a periodic tenancy.

The second is occupation after expiry with consent. A tenant stays on, the landlord agrees while terms are discussed, and the same uncertainty follows.

Both are avoidable by documenting the interim arrangement, and Nigerian parties rarely do.

The distinction from holding over matters here. A tenant who stays after a tenancy ends without the landlord's consent is a tenant at sufferance, holding over, and owes mesne profits. One who stays with consent is a tenant at will. The difference is agreement, and the practical consequence for the landlord is significant: accepting rent from either can create a new tenancy and reset the recovery process.

For a landlord, the practical rule is to say in writing what the arrangement is before somebody occupies, and to be careful how any payment received is characterised. For an occupier, the rule is to get the lease signed before spending money on the premises, because a tenancy at will can be ended tomorrow.

Three positions an occupier can hold without a fixed term lease.

A tenancy at will is occupation with consent and exclusive possession, with no term. Either party can end it at any time, and it is the least secure form of tenancy.

A periodic tenancy runs from period to period, monthly or yearly, and continues until determined by the notice the applicable law requires for that type. It commonly arises where rent is paid by reference to a period and accepted.

A tenancy at sufferance arises where a tenant holds over after a tenancy ends without the owner's consent. There is no agreement, mesne profits rather than rent are payable, and the landlord must still follow the recovery process.

An occupier moving from the first to the second gains real protection, and a landlord who accepted rent without thinking about it has given it to them.

The arrangement is inherently insecure. An occupier can be required to leave at any time, which makes investing in the premises unwise.

It is also poorly documented by definition, which means the parties frequently disagree about what was agreed.

Conversion into a periodic tenancy can happen without either party intending it, simply through rent being paid and accepted.

And even a tenancy at will does not permit self help. A landlord ending it still cannot change the locks on an occupier in possession, and must follow the recovery process where the occupier will not leave.