License Agreement

A license agreement allows a person to use or occupy a property without acquiring tenant rights. For landlords, granting a license instead of a tenancy might seem advantageous. However, simply calling an agreement a license doesn’t make it one.

In the landmark case of Street v Mountford [1], the House of Lords ruled that the actual circumstances of an arrangement, not the label attached, determine whether it is a tenancy or a license. The key characteristics of a tenancy include:

  1. Exclusive possession of the premises
  2. A specified period of time
  3. Payment of rent

Terminating a License Agreement

License agreements can typically be terminated with a notice to quit, which usually requires at least 28 days’ notice [2]. If the licensee breaches the terms of the agreement, the notice period may be shorter, as outlined in the agreement.

Evicting a Licensee and Protection From Eviction

Under the Protection from Eviction Act 1977, licensees of residential premises are generally protected from eviction [3]. This means landlords must obtain a possession order before evicting a licensee. However, excluded license agreements offer different rules, as these licensees do not have eviction protection.

A license is usually excluded if:

  • It is granted by a local authority for temporary accommodation to homeless applicants
  • The property is a hostel
  • The landlord shares living space with the licensee
  • It is for holiday purposes only
  • No payment is made (i.e., not for “money’s worth”)
  • There is no intention to create legal relations

When evicting a licensee under an excluded agreement, landlords benefit from simplified processes as possession orders are generally not required. However, clarity in the agreement is crucial to avoid disputes.

Special Rules for Licenses Granted to Homeless Applicants

Landlords and letting agents often collaborate with local authorities to provide temporary accommodation for homeless individuals. However, evicting such occupants may become the landlord’s responsibility after the local authority discharges its duties.

Homeless applicants granted a license under sections 188 or 190 of the Housing Act 1996 [4] are not protected under the Protection from Eviction Act 1977. Specifically:

  • Section 188: Interim accommodation pending inquiries into homelessness
  • Section 190: Duties to intentionally homeless applicants

Occupants in interim accommodation are considered excluded occupiers [5], meaning they lack eviction protection.

If a local authority accepts a long-term housing duty but allows the occupant to stay temporarily, the person gains basic protection under the Protection from Eviction Act 1977. In such cases, landlords must obtain a possession order when evicting a licensee [6].

Other Types of License Agreements

For land or commercial premises, license agreements often grant licensors the right to terminate without a possession order. Licensors may:

  1. End the agreement if the licensee breaches its terms.
  2. Terminate the agreement without reason, depending on the terms.

This typically applies to non-residential properties, where residential housing protections don’t apply. However, evicting a licensee from commercial premises must still comply with the specific terms of the agreement to avoid legal challenges.

Key Considerations for Evicting a Licensee

When evicting a licensee, it is vital for landlords to understand the legal framework surrounding the license agreement. Mislabeling a tenancy as a license can lead to complications, including the risk of unlawful eviction claims. Landlords should also ensure proper notice periods are adhered to and, where necessary, obtain a possession order.


[1] Street v Mountford (1985) 17 HLR 402, HL
[2] Section 5 of the Protection from Eviction Act 1977
[3] Section 1 of the Protection from Eviction Act 1977
[4] R (ZH and CN) v Newham LBC and Lewisham LBC [2014] UKSC 62; Desnousse v Newham LBC [2006] EWCA Civ 547; Mohamed v Manek and Kensington and Chelsea RLBC (1995) 27 HLR 439, CA; Huda v Redbridge LBC [2016] EWCA Civ 709
[5] R (ZH and CN) v Newham LBC [2014] UKSC 62; Mohamed v Manek and Kensington and Chelsea RLBC (1995) 27 HLR 439
[6] Dacorum Borough Council v Bucknall [2017] EWHC 2094 (QB)

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