Also known as: estates less than freehold · leasehold estate · nonfreehold estate
Written by attorneys — see sources below.
A possessory estate in land whose duration is fixed in time or computable by calendar units rather than measured by a human life. Such estates arise from landlord-tenant relationships and include terms of years, periodic tenancies, and tenancies at will.
Elena Estrada leased a retail storefront from Everest Holdings under a five-year written lease that included an option for Elena to purchase the building at a fixed price. When Elena attempted to exercise the option twelve years later, Everest Holdings refused on the ground that the option had expired. The court applied the rule governing options tied to leasehold estates and upheld the exercise because the leasehold duration controlled the option's life.
Eric Espinoza leased a warehouse from Emerald Enterprises for a ten-year term. During a citywide fire, officials ordered the building demolished to stop the blaze. Eric's leasehold interest was destroyed along with the structure. Because the interest was an estate less than freehold, Eric could pursue compensation only for the remaining lease term rather than for a fee interest.
In November 1872, a large fire broke out in Boston. Charles H. Hall was the lessee and occupant of the premises described in the declaration. The fixtures, merchandise, and tools in his leased space were valued at $60,000, and his leasehold interest was worth $10,000. The fire did not originate in Hall's building, but the structure and its contents were threatened as the blaze spread. Three fire engineers present at the scene ordered the building to be demolished to halt the fire's progress. The building was blown up and destroyed, which stopped the fire from advancing further. As a result, Hall's premises became unfit for use, and his personal property was destroyed. The plaintiff, as assignee of Hall's bankrupt estate, brought suit against the City of Boston to recover for these losses. The claim rested on Massachusetts statutes authorizing designated officers to order the demolition of buildings during fires and providing for compensation to owners when such action stops the fire, provided the building was not the origin point. A Boston city ordinance established a fire department consisting of a chief engineer and thirteen assistants, granting them authority to order demolitions when three or more engineers, including the chief if present, deemed it necessary. The case was initially tried in the United States District Court for the District of Massachusetts. The presiding judge directed the jury to return a verdict in favor of the defendant city. The plaintiff excepted to this ruling, included all trial evidence in the record, and appealed via writ of error to the Circuit Court. That court affirmed the District Court's judgment. A subsequent writ of error brought the matter before the Supreme Court for review. At trial, evidence included testimony from the mayor, who was present but provided no details on consultations regarding the specific building. The chief engineer testified that he and the engineers did not direct the blowing up of buildings by gunpowder when he was present. General Burt, who carried out the demolition using a written authorization from the chief engineer, stated that he did not consult with three engineers after starting the scheme. No evidence showed that three engineers had jointly consulted about or specifically ordered the destruction of Hall's particular building.
View caseAn estate less than freehold has a duration fixed by calendar time or recurring periods and arises only in landlord-tenant relationships. A freehold estate is measured by a human life or is of potentially infinite duration and is not created by a lease.
No. When a tenancy is terminable solely at the will of one party and is not otherwise structured as an estate for years or periodic tenancy, it is treated as a freehold estate rather than a nonfreehold estate.
The duration of an option appurtenant to a leasehold estate is governed by landlord-tenant law rather than the general reasonable-time rule that applies to standalone options.
…described herein for a term ending more than five years after any given date the owner of the reversion and the owner of the leasehold estate together shall be deemed to be the owners of such parcel on such given date within the meaning of this contract, and whenever the signature of the owner of such parcel shall be required on…