LICENCE-DEFINITION AND GRANT OF LICENCE INTRODUCTION Propert Property y is perhaps perhaps the most important important and the most complicated complicated and extensive branch of modern law. Under this eld of law, the rights, claims, duties and obligations of the parties involved with any kind of property become the subject of study. Earlier, licence was described as the fact that a landowner communicated his consent to anothers using his land! while at other times licence was described the legal legal relat relation ionshi ship p wher whereby eby the other other could could use the land land witho without ut being being liable liable for trespass. "n present times, licence is referred to as a validation by the owner of the land for the acts of the licensee which would otherwise be committed unlawfully. unlawfully. #he traditional concepts of $bare% or $mere% licenses, licenses $coupled with an interest% or $with a grant,% licenses $acted upon% or $executed,% and licenses $upon valuable consideration% were used earlier. &ost of these concepts assumed certain di'erences in the legal conse(uences of various transactions, and therefore furnished a poor starting point for determining what the legal conse(uences of a given transaction should be. "t also made it easy to overlook important license transactions which these phrases did not suggest. ) factual classication of licenses which starts with the di'erences in the parties intentions will place in one group the transactions wherein the parties have contemplated that the interests created should be revocable. *ut the transactions where the parties have contemplated irrevocable interests re(uire further subdivision. ) large number of licenses are not at all lacking in formality! they are called licenses solely to distinguish them from leases. )nother large group of licenses are so called because they are oral! previous discussion has been conned almost entirely to these. +icenses of another group present a di'erent problem because they are written but unsealed. till other licenses are so called, although they are in writing .and under seal, because they lack technical conveyance language. )ccording to some scholars, the legal instrument of $+icense% in immovable properties was developed to deal with the legal complications of lease and rental rights under "ndian "ndian law. law. "n partic particula ular, r, this this legal legal instru instrumen mentt was develo developed ped to enabl enable e prope property rty owners to restrict lessees and evict them more easily. easily. till, many property owners that intended to protect themselves by entering a leave and license agreement -i.e. a lice licens nse e agre agreem emen entt to use use an immo immove veab able le prop propert erty y for for a cert certai ain n purp purpos ose e,, nd nd themselves facing court decisions ruling that their agreement was in fact a lease agreement. ome of the mistakes made by such property owners may be avoided "n this work, elucidated the meaning of licence licence and how a licence is granted in "ndia. "n "ndia, "ndian Easements )ct of /001 governs such transactions. ection 21, 23 and 24 are the relevant provisions provide to understand concept and grant of licence in "ndia. #he di'erentia di'erentiation tion between leases and licence licence along with lease and easement have also been made. DEFINITION OF LICENCE
) licence licence is a personal personal right granted granted to a person person to do something something upon immovable property of the grantor and does not amount to the creation of interest in the property itself. "t is purely a permissive right and is personal to the grantee. "t creates no duties and obligations upon the persons making the grant and is, therefore, revo revoca cabl ble e exce except pt in cert certai ain n circ circum umst stan ance ces s expres xpressl sly y prov provid ided ed for for in the the "ndia "ndian n Easements act, /001 itself. #he licence, when granted, has not other e'ect to confer liberty upon the licencee to go upon the land which would otherwise be lawful.
$) licence in the law of land is ordinarily a permission pe rmission merely to do something on or to the detriment of the land of the giver of the licence, the licensor. 5ccasionally it is a permission to interfere with an easement or proft a prendre belonging to the licensor. licensor. "t creates a privilege in favor of the licencee.% ) licence licence may be oral in which case, terms, conditions conditions and the nature nature of the licence, licence, can be gathered from the purpose for which the licence is granted coupled with the conduct of the parties and the circumstances which may have led to the grant of the licence. Every licence is governed by the provisions under the Easements act. ) licence does not confer an interest or property in the thing, and though it may be coupled with a grant which conveys an interest in property, licence by itself does not confer any interest. 6here the parties entered into a partition agreement and divided the property giving themselves certain rights, it would not amount to a licence. #he negative denition of licence under "ndian law makes it necessary that before a right can be shown to be a licence only, it must be proved not to be an easement or an interest in the property. A.Licence under English Law )ccording to English +aw, a licence is purely a personal privilege or right enabling the lice licenc ncee ee to do some someth thin ing g on the the land land of the the lice licens nsor or whic which h woul would d othe otherw rwis ise e be unlawful."t is an excuse by reason of the consent of the licensor for doing an act which would otherwise be unlawful. "t is merely a leave to do a thing, which enables the licencee to do lawfully what he could not otherwise do except unlawfully. unlawfully. ) licence is merely a permission to do an act, which without such permission would amount to a trespass. ) dispensation or licence properly passeth no interest, nor alters alters or trans transfer fers s prope property rty in anythi anything, ng, but only only makes makes an action action lawful lawful,, which which without it had been unlawful. +icence is only a permission to do something on an immovable property like occupation, or enjoying fruit thereof, or using it for some other purpose. +icense is an o7cial permit or permission to carry on some business or do some act which without the license would be unlawful and the words license and permit are often used synonymously. +icence is interchangeable with permission. Permission or licence is granted for use of an immovable property for a particular purpose given by the granter to the grantee which as of a necessity in his retention of dominant right of possession over the immovable property with the granter. granter. LICENCE UNDER INDIAN LAW LAW
"n "ndia, "ndia, the "ndian "ndian Easeme Easements nts )ct, /001 /001 provi provides des for law relat relating ing to licenc licences es in property law. law. ection 21 of "ndian Easements )ct, /001 denes +icence as under8 $6here one person grants to another, or to a denite number of other persons, a right to do or continue to do, in or upon immovable property of the grantor, something which would, in the absence of such rights, be unlawful, and such right does not amount to an easement or an interest in the property, the right is called a licence.% 9rom the above denition of licence, it seems that if a person himself has ac(uired a right or interest in an immovable property through an instrument, the right conveyed in his favour in that instrument, will not be licence. "n "ndia, judicial and legislative denitions of licence have followed the English denitions of the term. Under ection 21, if a person is given the right to use the immovable property in a particular way under certain terms while retaining control and possession of the same, the person so permitted is only a licencee. #he (uestion that arises in this context is that that whethe whetherr the relati relations onship hip is that that of landlo landlord rd:te :tenan nantt or licens licensor or:lic :licen ensee see.. #he relationship depends on the intention of the parties that whether there was interest in the land or merely personal privilege without any interest. ) licence cannot be granted only in favour of denite number of persons and not in favour of ;uctuating body or individuals. #he agreement involved in the case, even if
binding on the defendants, cannot be considered to be at least a bilateral agreement between the representatives of the two parties and containing reciprocal conditions. ) licence is a personal right given to the licencee and, therefore, ection 2< of the Easements )ct, /001 provides that licence cannot be transferred by the licencee or exercised exercised by his servants and agents. #he upreme =ourt in> Associated Hotels of India Ltd. v Ltd. v.. R.N. Kapoor summed the concept of +icence as under8 $Under the aforesaid section, if a document gives only a right to use the property in particular way or under certain terms while it remains in the possession and control of the owner thereof, it will be a licence. #he legal possession, thereof, continues to be with the owner of the property, but the licencee is permitted to make use of the premises for a particular purpose. *ut for the permission, his occupation would be unlawful. "t does not create in his favour any estate or interest in the property.% property.% I i!"#ran # a$e n#e #% essenial %eaures #% licence as under /& N# rans%er #% ineres 8) licence is a permission to do some act which, without such permission, would be unlawful. 1 N# inere licens nsee ee has has no inte intere rest st in the the prop proper erty ty and and ineres s in accre accrei#n i#ns s 8) lice therefore, he ac(uires no right by accretion. Neiher r rans% rans%era era'le 'le n#r heria heria'le 'le 8) lice 3 Neihe licenc nce e is neit neithe herr tran transf sfer erab able le!! nor nor heritable. 4 ) licence is a matter purely "ers#nal between grantor and grantee. 2 (eci#n )* #% Ease!en )ct does not re(uire any consideration, material or nonmaterial, to be an element of the denition of licence, nor does it re(uire that the right under the licence must arise by way of contract or as a result of mutual promises. < #he person who grants the licence must be the owner of the property. #he other person who gets the permission must be a stranger or have no right in the property. property. ? licenc licence e creaes n# duies and #'ligai#ns upon the person making the grant and is therefore revocable except in certain circumstances expressly provided in the )ct itself. 0 ) licence is usually rev#ca'le '+ gran#r , except except in the two cases mentioned mentioned in the section <@ of Easement )ct. A ) subse(uent transfer of the property p roperty terminates a licence. /@ ) licensee cannot sue trespassers trespassers and strangers in his own name. // ) licence is terminated by death of either party. party. ,IND( OF LICENCE
) licence may be of the following two kinds8 . are licence which is "urel+ "urel+ a !aer !aer #% "ers#nal "rivilege/ and *. Licence Licence c#u"led c#u"led wih a gran #r ineres ineres in he he land. 6hether the act allowed to be done is a bare licence or something more than a licence depends on the terms of the transaction. 6hen a landowner permits another to use the land under circumstances in which it is reasonable to foresee that the licensee will spend money or otherwise change position in the belief that the license will not be revoked, the license may become irrevocable. 9or example, if a person owns two parcels, one of which has no access to a public road, sells the landlocked parcel to another person, and gives him permission to build a driveway across the lot the seller has retained, the license becomes irrevocable when the buyer invests in the property, reasonably believing that the permission will not be revoked. .
are Licence
) bare licence is a personal permission or consent, granted without consideration, to enter, traverse over or be present upon the land of another. ) bare licence is a licence granted gratuitously which is not coupled with the grant of an interest in the land, e.g. the licence which one necessarily grants to ones guests. uch a licence may be revoked at any time. ) bare licence is a defence to what would otherwise amount to the tort of trespass. 6here the licencee oversteps the ambit of the licence, his status will therefore be that of trespasser."f the person is permitted to enter the land for one purpose but enters for another purpose, or whilst on the land begins to pursue a di'erent purpose to that whic which h he is auth author oris ised ed,, agai again n he beco become mes s a tres trespa pass sser er,, wher where e it is know known n or understood that the occupier would not have given consent. "f a person person is allowed allowed to do the act on the land without without interfering interfering with the nature nature of the land or without taking any prots from the land, then it is a case of bare licence. *are licences may be created expressly or impliedly and no formalities are re(uired B a bare licence may arise by implication from circumstances or conduct. *are licenses generally are not assignable -transferable and are revocable at will by the property owner. *are licence becomes irrevocable when the licensee acting upon the licence executes a work of a permanent character and incurs expense in doing so. *. Licence c#u"led wih a gran #r ineres in land ) licence coupled with a grant or interest in land arises where there is a permission to enter onto anothers land for the purpose of removing something from that land -such as timber. #his licence combines the grant of an interest -such as a prot a prendre with an ancillary permission to enter the land to realise or exploit that interest. ) license coupled with an interest arises when a person ac(uires the right to take possession of property located on someone elses land, as when a lender ac(uires the right to repossess an automobile that is located on private property after the borrower has defaulted on a loan. ) licence may be coupled with the grant of an interest in the land, as when standing timber is sold on terms that the purchaser is to sever the timber8 the sale of the timber on these terms implies the grant to the purchaser of a licence to enter the land in order to obtain the timber. uch a licence is irrevocable so long as the interest to which it is annexed lasts, and unless otherwise agreed it can be assigned. "f the person is allowed to take exclusive possession of the land, to plant trees over it, then it is not a bare licence but it is a licence that is coupled with grant or interest in land. "f the licence gives the licensee a right to make a construction on land, it is not a bare license but it is a licence coupled with an interest in land. "n such a case, the licensee who has entered possession after execution of the licence, is entitled to maintain a suit against the trespasser who has dispossessed him. +icenses coupled with an interest usually are both assignable and irrevocable, at least until the holder of the license has had a reasonable time to retrieve the property that gave rise to the license. 6here such operative facts give a privilege accessory to and in aid of the exercise of a power, or other legal interest, otherwise vested in the licensee. Graui#us licensee #he word $Cratuitous% $Cratuitous% means without without consideration or freely. freely. /. Cratuitous licensee shall not transfer license to any other person. 1. Cratuitous licensee shall not le suit against trespasser or stranger. stranger. In case #% 0ishivanah 0. 1anda'hai re"#red in 2234*&#!.C.R. 536/ it was held that a gratuitous licensee cannot claim any legal right in the property. property. Righs #% 7licensee 8 /. Decision passed by court against licensor is binding on the licensee. 1. 6hen licence is revoked, then licensee is entitled to reasonable time to leave the property a'ected thereby and to remove any goods which he has been allowed to place on such property.
3. 6hen gratuitous licensee executes work of permanent character during licence and with the consent of licensor, then gratuitous licensee is entitled to get compensation of expenses incurred by him after revocation of licence. Duies #% Graui#us licensee 9 /. "t is the duty of gratuitous licensee that he shall not cause injury or damage to the property. 1. "t is his duty that he shall not make any permanent change in the property of licensor which is in his possession. 3. "t is his duty to abide each and every terms and condition of licence. 4. "f licensor is not aware about any injury or damage caused to the property of licensor by third person, then it is the duty of licensee to inform it to licensor. licensor. 2. "t is his duty to disclose any defect in the property of licence to licensor if he nds it. <. )fter completion of period of license, gratuitous licensee has to vacate premises property or to give possession of property to licensor. licensor. ?. "t is his duty to take care of property or premises of licence during the period of licence. LEA(E AND LICENCE9 DI(TINCTION As de:ned '+ (eci#n 3) #% he Trans%er Trans%er #% ;r#"er+ Ac/ <<*9 ) lease of immovable immovable property property is a transfer transfer of a right to enjoy such property, property, made for a certain time, express or implied, or in perpetuity, in consideration of a price paid or promised promised,, or of money, a share of crops, crops, service service or any other thing thing of value, to be rendered periodically or on specied occasions to the transferor by the transferee , who accepts the transfer on such terms.#he transferor transferor is called the lessor, the transferee is called the lessee, the price is called the premium, and the money, share, service or other thing to be so rendered is called the rent. The re=uire!ens %#r a lease are9 exclusive possession of a dened area of land, for a xed period -or series of periods of time, with the intention to create an estate in land B that is an interest in the land itself which can be assigned or sold. ) licence is simply a permission to use land. "t allows someone access to the land of another for an agreed purpose. "t is an authority that justies what would otherwise be a trespass. "t does not confer any interest in land. 6hether a transaction amounts to a lease or license, is a (uestion that has been consid considere ered d in a whole whole host host of judicia judiciall pronou pronounce ncemen ments ts and cases cases contin continue ue to be handed over. #he (uestion that whether a transaction is lease or license depends upon the intention of the parties and whether exclusive possession has been given or not. #he es # deer!ine ha wheher a ransaci#n is a lease #r a licence is9 /. #he #he inte intent ntio ion n of the part partie ies, s, which which is to be gathe gathere red d from from the term terms s of the the contract. "f the terms are not clear, then the surrounding circumstances shall determine the intention of the parties. 1. "n the the abse absenc nce e of a writ writte ten n docu docume ment nt and and when when some somebo body dy is in excl exclus usiv ive e possession, then the intention is to be gathered from other evidence such as exclusive possession would be the most relevant circumstance to arrive at the intention of the parties at the time of making the lease. 3. "f dispute dispute arises then intentio intention n to be gathered gathered from the reading reading of the document document as a whole. 4. +ease +ease or licence is matter matter of contract contract between between the parties. parties. #he contract contract is to be cons constr true ued d or inte interp rprreted eted on the the well well:l :lai aid d prin princi cipl ples es for for cons constr truc ucti tion on of contractual terms. • • •
#he denition in ection 21 of the )ct referred to above does not refer to exclusive possession. "f there is no exclusive possession then the arrangement cannot be a lease and must be a licence. #he general rule is that the =ourt will look at the substance of the agreement rather than the form in which it is expressed. #he !a>#r di?erences 'eween lease and licence are8 ) +eas +ease e is a tran transf sfer er of righ rightt to enjo enjoym ymen entt -exc -exclu lusi sive ve poss posses essi sion on of that that property by the lessor the lessee, made for a certain term in consideration of a fee subject to the terms set out in the lease agreement while a licence is the granting of a permission to use the land in consideration of a fee subject to the conditions set out in the licence. ) lease grants exclusive possession for a xed period -term. ) licence does not grant exclusive possession. ) lease creates an interest in the land which can be transferred to the lessee for the period of the lease. ) licence does not create or transfer an interest in the land. ) lease can be transferred -assigned to another party and if registered on the title is binding on a new owner of the land. ) licence is not transferable. ) lease is not revocable -other than subject to any conditions set out in the lease -e.g. a redevelopment clause. ) licence is revocable. Licence and Ease!en9 Disinci#n )s per (eci#n 5 #% he Indian Ease!ens Ac/ <<* ! easement is dened as right which the owner or the occupier of certain land possesses, as such, for the benecial enjo enjoym ymen entt of that that land land,, to do and and cont contin inue ue to do some someth thin ing, g, or to prev preven entt and and continue to prevent something being done, in or upon, or in respect of certain other land not his own. )n easement is right or interest in immovable property for the land belonging to another. 6hen once an easement is validly created, it is annexed to land. #he benet of it passes with the dominant tenement and the burden of it passes with the servient tene teneme ment nt to ever every y pers person on into into whos whose e occu occupa pati tion on the the domi domina nant nt and and serv servie ient nt tenements respectively come. #he !a>#r "#ins #% di?erence 'eween an ease!en and a licence are the following8 /. )n ease easeme ment nt is a righ rightt appe appert rtai aini ning ng to prop proper erty ty whil while e a lice licens nse e is only only a personal right. 1. )n easem easemen entt is a righ rightt in rem and is enfo enforc rcea eabl ble e by all and and agai agains nstt all all into into whose hands the servient and the dominant tenements respectively may come, while a license is only a right in personam and therefore, not so enforceable. 3. )n easemen easementt can be assign assigned ed with the proper property ty to which which it is annex annexed, ed, but a license cannot be assigned at all except where it is a license to attend a place of public entertainment. 4. ) right of easement easement is not revocabl revocable e at the will of the grantor grantor while a license license is so revoc evocab able le,, exce except pt wher where e the the gran granto torr is stop stoppe ped d by his his cond conduc uctt from from exercising the power of revocation conferred by law. 2. ) lice licens nse e is per permiss missiv ive e righ rightt trac tracea eabl ble e to a gran grantt from from the the lice licens nsor or eith either er expr expres essl sly y or impl implie iedl dly y. *ut *ut an ease easeme ment nt is ac(u ac(uir ired ed eith either er by asse assert rtiv ive e enjoym enjoyment ent by the domina dominant nt owner owner or by a negati negative ve covena covenant nt betwee between n the parties or by grant or by statute. <. )n easement easement may be positi positive ve or negati negative ve in charac character ter,, a licens license e is invariab invariably ly positive and cannot be negative in character. "t may be that there are cases in which a negative pbligation might be cast on the licensor with the object of protecting a licence coupled with a grant but such obligation is due to the grant accompanying the licence and not to the licence per se. •
•
•
•
•
GRANTING OF LICENCE
#he provisions relating to granting of licence are the same as those governing the easements. #he provisions relating to granting of licence in "ndia are ections 23 and 24 of the "ndian Easements )ct, /001. #wo #wo preliminary (uestions that arise when entering into a +eave and +icence agreement are B who can grant a licence and how a licence is granted. #he rst (uestion is answered in section 23 of #he "ndian Easements act, /001, that states that a licencee may be granted by anyone in the circumstances and to the extent in and to which he may transfer his interests in the property a'ected by the licence. "n other words, one cannot grant a licence and one cannot receive a licence if the licensor does not possess a su7cient lawful interest in the property. property. #he second (uestion is answered in section 24 of #he "ndian Easements act, /001, that states that a the grant of a licence may be express or implied from the conduct of the the gran granto tor, r, and and an agr agreeme eement nt whic which h purp purpor orts ts to crea create te an ease easeme ment nt,, but but is ine'ectual for that purpose, may operate to create a licence. #his denition is very important. 5wners of properties should mind that their behavior may create a licence, even without a formal licence agreement. +icence is, therefore, a grant of a right to do something upon an immovable without creating interest in the property. "t is therefore, distinguishable from an allied grant such as a lease or an easement. *oth lease and easement create an interest in the property. +icence is only a permission to do something on an immovable property like occupation, or enjoying fruit thereof, or using it for some other purpose. ;OWER TO GRANT A LICENCE
ection 23 provides for the power to grant a licence. "t states that B ) licence may be granted by anyone in the circumstances and to the extent in and to which he may transfer his interests in the property a'ected by the licence. Power to grant a licence is co:extensive with the power to transfer. ) man can grant a license in the circumstances and to the extent he can transfer his interest in the prope property rty a'ecte a'ected d there thereby by.. #he power power to grant grant a licens license e is only only a person personal al right right attaching only a personal obligation on the grantor is more extensive than the power to impose an easement which a'ects the property itself. itself. ) licence by a mortgagee or co:tenant who is lawfully in the sole possession and enjoyment enjoyment of the property property,, to do a thing which he could himself himself lawfully do is a valid licence. )nyone who can transfer property even if he is not the owner can grant a licence. #he licence can also be revoked by such a person. #he grant of licence may be express or implied which can be inferred from the conduct of the grantor. Under ection 21, there is a grant of the right made by the grantor. grantor. 6ithout a grant in the general sense, no licence can be created. )n agreement for licence can subsist and continue to take e'ect only so long as the lice licens nsor or cont contin inue ues s to enjo enjoy y a righ right, t, titl title e and and inte interrest est in the the prem premis ises es.. 5n the the termination of the right ot the title, the agreement for licence comes to an end. "f the licensor licensor is an tenant, tenant, the agreement agreement for licence licence by him terminates terminates with the tenancy, and the licence ceases to be licensee. "n order to grant a licence, the licensor need not be the owner of the property. #he tenancy rights are also immovable rights of the tenant and therefore, he can grant the licence. *ut by virtue of ection 23, the tenant can grant the licence subject to the limitation and the extent to which he may be able to transfer the interest, viF., the tenancy rights. ) tenant is empowered to transfer his interest but he cannot do so beyond the term of his lease. FOR@ OF LICENCE EB;RE(( OR I@;LIED
ection 24 provides that B #he grant of a licence may be express or implied from the conduct of the grantor, and an agreement which purports to create an easement, but is ine'ectual for that purpose, may operate to create a licence. ) licence is notionally created where a person is granted the right to use the premises without becoming entitled to the exclusive possession of them or the circumstances and conduct of the parties show that all that was intended was that the grantee should be granted a personal privilege with no legal interest. ) mere licence passes no interest nor alters or transfers property in any way but merely merely makes makes an act lawful which without without would have been unlawful. unlawful. "t is necessary that the licence be in writing or registered.6here registered.6here the licence is coupled with a grant of immovable property or of an interest in immovable property, which is compulsorily registrable, it must be in writing or registered. I!"lied Licence ) lice licenc nce e may may be impl implie ied d from from the the cond conduc uctt of the the lice licens nsor or wher whereb eby y he allo allows ws something to be done on his land by another person who believes the land to be his own.GxlvH own.GxlvH ) ) plea of implied licence may be based on the right of e(uity to intervene, must have for its foundation either a contract or the existence of some fact which the legal owner is stopped from denying. )n everyday:life example of implied licence is in the case of a shopkeeper in the invitation to customers to enter his premises to do business. +icence may also be implied from the conduct of the licensor which induces in the mind of the licensee a reasonable belief that the former consents to the latters doing of certain acts, the doing of o f which would have been unlawful but for such consent. #he consent may also consist consist of words, spoken spoken or written or acts and omissions on the part of the licensor that would invoke reasonable belief in the mind of the licensee that what he does is either actively approved or not objected to by the licensor. licensor. ) licence to enter upon the land of another is not implied by the sale of goods which are stored upon the land, by a person other than the person against whom it is claimed, nor the failure of the tenant to keep the premises in repairs authorises the landlord to enter upon it for that purpose, in the absence of a contract to that e'ect. E"ress Licence )n expr express ess license license is one which in direct direct terms terms author authoriFe iFes s the performan performance ce of a certain act! as a license to keep a tavern given by public authority. Express licences govern more specic situations where the permission has been expressly directed towards a particular individual. )n example is where owner invites guests for dinner or to stay in a room on his property. #he licence governs only the specied period of the stay and any re:entry after that period without further permission would constitute trespass. "t is important to note that a person cannot grant a licence to himself or to himself jointly with another. another. #herefore, it must be granted by an owner of the property who is di'erent from the licensee. )s a grant forms the basis of an easement as well as a licence, an agreement which purports to create an easement may operate to create a licence only if it is ine'ectual for for cert certai ain n reaso easons ns to crea create te such such ease easeme ment nt.. )s both both an ease easeme ment nt and and lice licenc nce e legaliFe acts which would have been unlawful otherwise, both go hand in hand but while while lice licenc nce e stop stops, s, an ease easeme ment nt goes goes furt furthe herr and and inco incorp rpor orat ates es itse itself lf with with the the prop proper erty ty of the the gran granttee, ee, the the bene eneci cial al enjo enjoy yment ment of whic which h is its its prin princi cipa pall characteristics. #he rule in England where an easement is created only by grant under seal has a very salutary salutary e'ect. e'ect. "n "ndia, the cases between between landlords landlords and tenants, tenants, in which a grant by the former to the latter, of a right of easement, is ine'ectual to create an easement in the strict sense of the term, are covered by this rule. RE0OCATION OF LICENCE
a ) conjoi conjoint nt regard regarding ing of s.2A s.2A and <@ of the )ct would would establ establish ish that though though ordinarily all licences are revocable when the grantor transfers the property, yet, in two exceptional cases provided for under .<@, the transfer would not by itself put an end to the licence. Provisions of .<@ (ualies and restricts the scope of general provisions with reference to the revocability of licence under .2A of the )ct. "f the licence is for some reasons irrevocable by the grantor himself . 2A does not authoriFe the transferee to revoke it. #he transferee of the property from a licensor has no higher rights than those of the transferor and conse(uently the transferee is not entitled to revoke the licence when the licensee had built upon the land. b +eave +eave and +icense agreemen agreementt comes to an end on the ceasing of the interest interest of the licensor in the property particularly if the agreement merely creates licence. ) licence is neither annexed to the property in respect of which it is enjoyed, nor is it a transferable or heritable right, but is a right purely personal between grantor grantor and licensee. licensee. #herefor #herefore, e, where where a licensee licensee dies, the licence expires expires and the legal representatives of the licensee hold as mere trespassers. License when rev#ca'le 8 ) licence may be revoked revoked by the grantor, unless - a it is coupled with a transfer of property and such transfer is in force! -b -b the the lice licens nsee ee,, acti acting ng upon upon the the lice licenc nce, e, has has exec execut uted ed a work work of a perm perman anen entt character and incurred expenses in the execution. execution. ) bare licence can always be revoked revoked by grantor. grantor. ) licence, unlike a contract, creates no mutual obligation and rights between parties and it may be revoked under this section except when it is one which falls within the exception mentioned therein. #he power of revoking a bare licence given by the section to the licensor is not a'ected by the fact that the licence has been given for a valuable consideration. #he fact that a licence has been ac(uired for an agreed term would not a'ect the right of the licensor to revoke it at any time where it is only a bare licence. #he licensor has the power to revoke a licence at any time and his right to do so is not dependent upon his his givin giving g a reas reason onab able le noti notice ce or su7c su7cie ient nt time time to the the lice licens nsee ee as a cond condit itio ion n precedent. #he right of a licensee to get a reasonable notice before revocation and the right of the licensor to revoke a licence are not interrelated in the sense that the licensor could be restrained from exercising his right without issuing such a notice as a condition precedent. Easements act In he he case case #% hau haura ra# # vs. vs. Gee Geea' a'ai ai *3 *345 45&& @h.L @h.L.1 .1.. 26. 26. Easements ection <@-b B "rresvocable licence Proof of B merely because there is a work of permanent character executed by incurring expenses, would not by itself be enough to establish that the licence was irrevocable. i rrevocable. In he case #% i!!ara# @aru#ra# Dh#'ale vs. Arun Gulra# 1ich$ar/ *3) Easeme ment nts s )ct ect ectio ion n <@-b <@-b and and Evid Eviden ence ce )ct )ct ect ectio ion n //2 //2 B 4*& @h.L. @h.L.1. 1. )63. Ease )ppellant proved that respondent is licensee on suit plot B Iespondent constructed house on the suit plot and occupied and resided in it Iespondent cannot be denied benet of provisions of section <@-b merely because respondent had denied that he is a licensee. (.6*deals wih he licence which dee!ed # 'e rev#$ed 9 ) 6hen from a cause preceding the grant of it, the grantor ceases to have any interest in the property a'ected by the licence! * 6hen the licensee releases it, expressly or impliedly to the grantor or his representative! representative! = 6here it has been granted for a limited period, or ac(uired on condition that it shall become void on the performance or nonperformance of a specied act, and the per iod expires, or the condition is fullled.
D 6here the property a'ected by the licence is destroyed or by superior force so permanently altered that the licence can no longer exercise his right! E 6here the licensee becomes entitled to the absolute ownership of the property a'ected by the licence. 9 6here the licence is granted for a specied purpose and the purpose is attained or abandoned or becomes impracticable! C 6her 6here e the the lice licenc nce e is gran grante ted d to the the lice licens nsee ee as hold holdin ing g a part partic icul ular ar o7ce o7ce,, employment or character, and such o7ce employment or character ceases to exist! J 6here the license totally ceases to be used as such for an unbroken period of twenty years and such cessation is not in pursuance of a contract between the grantor and the licensee! " "n the the case case of an acce access ssor ory y licen licence ce,, when when the the inte intere rest st or righ rightt to whic which h it is accessory ceases to exist. CONCLU(ION
#he conclusion that the term license implies nothing does not mean that there is no law of licenses. #here is license law, but it must be stated in terms of particular types of case cases. s. 6her 6here e a lice licens nsor or give gives s no reaso eason n to expec xpectt othe otherw rwis ise, e, the the lice licens nsee ees s privileges can be terminated at will. 6here a licensor manifests an intention that the priv rivilege shall be more enduring, the conse(uences depend upon other circumstances. "f it o'ends no legal policy, the license may create a true easement. "f it o'ends the rule re(uiring a sealed instrument, it will probably create an easement, but the licensee can obtain relief only through e(uitable procedure. "f enforcement of the license would encumber the land with relatively useless burdens, neither the parties expectations nor their formalities nor their expenditures will give the interest the characteristics of an easement. #his simple rationaliFation of license license cases is largely impeded by the ambiguous usage of license to signify sometimes a transaction, sometimes a relationship. )ll the recent writers agree that one of the usages should be adopted and the other rejected, but disagree on which to adopt and which to reject. Illusrai#n 4A&9 )n owner of a property enters into a lease thereof, but to avoid the rigours of Ient =ontrol legislation, calls it as a licence agreement. #hough such a lease is captioned as a Klicence agreementL, the terms thereof show that it is in essence, a lease. uch a licence agreement which puts the licensee in exclusive possession of the premises, untrammeled by any control, and free from any directions from the licensor -instead of conferring only a bare personal privilege to use the premises will be a lease, even if described as licence. 9or example, if the exclusive possession of an apartment or a ;at or a shop is delivered by the owner for a monthly consideration without retaining any manner of control, it will be a lease irrespective of whether the arrangement is called by the owner as a KleaseL, or KlicenceL. )s far as the person who is let into exclusive possession, the (uality and nature of his rights in respect of the premises will be that of a lease or a tenant and not that of a licensee. 5bviously such a KlicenseeL cannot be KevictedL or KdispossessedL or prevented from using the premises without initiating legal action in accordance with law. law. Illusrai#n 4&9 #he owner of a land constructs a shopping mall with hundred shops. #he owner of the mall earmarks di'erent shops for di'erent purposes, that is sale of di'erent types of goodsmerchandise, that is shops for exclusive clothing for men, shops for exclusive clothing for women, shops for hosieries, shops for watches, shops for cameras, shops for shoes, shops for cosmetics and perfumes, shops for watches, shops for sports goods, shops for electronic goods, shops for books, shops for snacks and drinks etc. #he mall owner grants licences in regard to individual shops to licensees to carry on the identied or earmarked business. #he licensor controls the hours of business,
regulates the maintenance, manner of display, cleanliness in the shops. #he ingress and egress to the shop licensed to the licensee is through the corridors in the mall leadin leading g from from three three or four four common common access access points pointsen entra trance nces s which which are are under under the control of the licensor. #he licensee is however entitled to stock the shop with brands of his choice though he does not have the right to change the earmarked purpose, entertain any clientale or customers of his choice and x the pricesterms for his goods. Je can also lock the shop at the end of the business hours and open it whenever he wants. Mo one else can trade in that shop. "n such a case, in spite of the restrictions, controls and directions of the licensor, and in spite of the grant being described as licence, the transaction will be a lease or tenancy and the licensee cannot be dispossessed or evicted except by recourse of law. law. Illusrai#n 4C&9 "n a shopping complex or in a mall the owner gives a licence to a person to use a counter to sell his goods in consideration of a fee. #he access is controlled by the licensor and there is no exclusive use of any specic space by the licensee. )t the end of the day, the licensee can close the counter. #he space around the counter is visited and used by customers to the mall and not exclusively by the customers of the licensee. "n such a case, if the licence is terminated, the licensor can e'ectively prevent the licensee from entering upon his premises and the licensee will have no right to use the counter except to remove his belongings. "n such a licence it may not be necessary for the licensor to sue the licensee for KpossessionL or KevictionL. Illusrai#n 4D&9 ) much narrower version of a licence is where an exhibitor of cinematograph lms, or a theatre owner permits a KcustomerL or KguestL to visit an entertainment hall to view and enjoy a movie or a show for the price of a ticket. #he licensee is permitted to occupy a seat in the theatre exclusively for the period of the show. 5r a cloakroom with with toilet toilet facili facilitie ties s in a public public buildin building g permit permits s a visito visitorr to use the toiletcl toiletclose osett faci facilit litie ies s on paym paymen entt of a fee. fee. #he #he lice licens nsee ee is perm permit itte ted d to use use the the toil toilet etcl clos oset et exclusively to relieve himself. "n such cases, the licence is for a specic purpose and for a specic period. #he licensee has no other right to enter the premises, nor the right to continue to occupy the seat in the theatre or use the toiletcloset continuously. continuously. uch a licensee can be forcibly removed by the licensor if the licensee overstays or continues to occupy the seat beyond the show, or refuses to leave the cloakroom. "t is not necessary for the licensor to sue the licensee. "llustration -E8 ) reputed manufacturer of textiles owns several retail outlets in di'erent parts of the country. #he outlets are housed in premises owned by the manufacturer or premises taken by it on lease. #he manufacturer employs a sales manager on salary for each outlet to manage the outlet and sell its products and entrust him with the keys of the premises, so that he can open the outlet for business and close the outlet at the end of the day. 5r the manufacturer, instead of engaging a sales manager, appoints an agent who is permitted to sell only the products of the manufacturer in the retail outl outlet et,, and and recei receive ve a comm commis issi sion on on the the turn turnov over er of sale sales. s. #he #he manu manufa fact ctur urer er stipulates the manner of sale, and the terms of sale including the prices at which the goods are sold. #he manufacturer also checks the products sold periodically to ensure that only its products -and not fakes are sold. #he manufacturer also reserves the right right to termi termina nate te the the serv servic ices es of the the sale sales s mana manage ger rag agen ent. t. "n such such case cases s on termination of the services of the employeeagent, the manufacturer can physically prevent the sales manageragent from entering the retail outlet and make alternative arrangements for running the outlet. #here is no need to approach a court to KevictL the sales manageragent CA(E LI(T Ass#ciaed #els #% India Ld. vs. R.N. ,a"##r/ 263 (CR 6< 4(u"re!e C#ur/ 2)2& ) lease is a transfer of an interest in land. #he interest transferred is called the o leasehold interest. #he +esser parts with his right to enjoy the property during
the term of the lease and the lessee gets that right to the exclusion of the +esser. "n case of license, the legal possession continues to be with the owner of the o prop proper erty ty,, but but the the licen license see e is perm permit itte ted d to mak make use use of the the prem premis ises es for for a particular purpose. *ut for the permission his occupation would be unlawful. "t does not create in his favour any estate or interest in the property. @rs. @rs. @.N. @.N. Clu'w Clu'wal ala a v. Fida Fida uss ussai ain n (ahe (ahe'/ '/ 265 265 6 (CR (CR 65* 4(u" 4(u"re re!e !e C#ur/ 265& 6hether an agreement creates between the parties the relationship of landlord o and tenant or merely that of licensor and licensee the decisive consideration is the inte intent ntio ion n of the parti arties es.. #his his inte inten ntio tion has to be asce ascert rtai ain ned on a consideration of all the relevant provisions in the agreement. Chandu Chandu Lal vs. @unici @unici"al "al C#r"#r C#r"#ra ai#n i#n #% Delhi/ Delhi/ AIR AIR 2H< Delhi Delhi H5 4Delhi 4Delhi igh C#ur/ 2H<& #he intention of the parties is the real test for ascertaining the character of a o document. "f a document gives only a right to use the property in a particular way but its o possession and control remains with the owner thereof, it will be a license. "n such a case the legal possession remains with the owner of the property, the licensee being permitted to make use of the property for a particular purpose. Exclusive possession does not militate against the concept of a license, if the o circumstances negative any intention to create a tenancy. ) license only makes an action lawful which without it would be unlawful, but o does not transfer any interest in favor of the licensee in respect of the property. property. "n the case of a license there is something less than a right to enjoy the property o in the licensee, while on the other hand, in the case of a lease, there is a transfer of a right to enjoy the property. ) bare licensee having no interest in the property cannot maintain an action for o its possession. Ra>'ir ,aur and Anr. vs. (. Ch#$esiri and C#. AIR 2<< (C <5) #he (uestion whether a transaction is a lease or licence $turns on the operative o intention of the parties and there is no single, simple litmus test to distinguish one from the other.% #he grant only for the right to use the premises without being entitled to the o exclusive possession thereof thereof operates merely as a licence. o Exclusive possession itself is not decisive in favour of a lease and against a mere licence, for, even the grant of exclusive possession might turn out to be only a licence and not a lease where the grantor himself has no power to grant the lease. Dela Inerna Inernai#na i#nall Li!ied Li!ied vs. (h+a! (undar (undar Ganeriwall Ganeriwalla a An#her An#her// AIR 222 (C *63H o #o #o nd out whether the document creates lease or license real test is to nd out Nthe intention of the parties! keeping in mind that in cases where exclusive possession is given, the line between lease and licence is very thin. @unici @unici"al "al C#r"#r C#r"#rai ai#n #n #% Delhi Delhi vs. ;radi" ;radi" Oil C#r"# C#r"#ra rai#n i#n and Anr./ 33 4*33*& DLT 55* 4Delhi igh C#ur/ *33* ) mere license does not create interest in the property to which it relates. +ease o on the other hand, would amount to transfer of property. +icense may be personal or contractual. o ) licensee without the grant creates a right in the licensor to enter into a land o and enjoy it. *y reason of a license, no estate or interest in the property is created. o
) license, inter alia, -a is not assignable! -b does not entitle the licensee to sue the stranger in his own name! -c it is revocable and -d it is determined when the grantor makes subse(uent assignment. @adhu ehal and Anr. vs. Rishi ,u!ar and Anr./ 4*332& ;LR 6*< 4;un>a' ar+ana igh C#ur/ *332& "t is never a nomenclature in the document that governs the decision as to o whether a document as a Nlease or a Nlicence. #he essential feature that distinguishes a lease from licence is always a transfer o of interest in the demised property in a transaction of lease while a licensee does not involve any such transfer of interest. #he lease is heritable while license is personal personal to the grantee. o #he legal possession of the property is inevitably transferred to a tenant under o lease while in a transaction of license the legal possession continues with the licensee and the licensee has a mere right of user of the premises in a particular fashion mentioned under the document. In Booker v. Palmer [xxix],, +ord Creen stated that:$#here is one golden rule to be [xxix] foll follo owed is that that law law doe does not imp impute ute an inte intent ntio ion n to ente enterr into into cont contra ract ctu ual relationships where the circumstances and the conduct of the parties negative any intention of the kind.% In C!! v. Lane [xxx], +ord Denning said that:$#he (uestion in all these cases is one of intention8 Did the circumstances and conduct of the parties show that all that was intended was that the occupier should have a personal privilege with no interest in the land.% o
