What are the legal aspects to
keep in mind while entering into a residential leave and license agreement?
- Quite
a few states mandate that any agreement for a period of more than 12
months must be stamped and registered. Stamp duty varies from state to
state. Any leave and license agreement for more than 12 months executed
without the payment of stamp duty may attract a fine, depending on the
laws in that particular state. Get a lawyer to confirm the stamp duty and
registration requirements at the time of executing a leave and license
agreement.
- Terms
and conditions of use of the premises should be agreed to, between the
parties. For instance, there is no legal requirement for tenants to be
vegetarian. But if the parties so agreement, then it becomes a valid term
of the agreement, then it becomes a valid term of the agreement.
Therefore, it is best to be very clear about the terms and conditions of
use.
- Always
specify the ‘deposit’ amount in the agreement. It’s important to clarify
as to whether it is refundable or not, with or without interest.
- Clearly
state the incidences where deposit may be deducted – that is, for
unauthorized use or for non-payment of rent.
- Clarify
the relationship of the lessee with the building co-operative/society if
any make sure to state clearly who is responsible to pay maintenance
charges.
- Try
to include a list of fittings and movables included in the premises on
lease, in the premises on lease, in an annexure to the agreement. This
will help you to keep track of what to return when the premises are
vacated.
- Make
sure to include a notice period – say 24 hours for the landlords to
inspect the premises. Conversely, there should be a notice period to
vacate the premises (on either side) since it helps both parties prepare
for the change.
