Louisiana Notary

A Civil Law Tradition

Lease

Lease – Type of leases

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Lease – Type of leases

Art. 2671. Types of leases. Depending on the agreed use of the leased thing, a lease is characterized as: residential, when the thing is to be occupied as a dwelling; agricultural, when n the thing is a predial estate that is to be used for agricultural purposes; mineral, when the thing is to be used for the production of minerals; commercial, when the thing is to be used for business or commercial purposes; or consumer, when the thing is a movable intended for the lessee’s personal or familial use outside his trade or profession. This enumeration is not exclusive. When the thing is leased for more than one of the above or for other purposes, the dominant or more substantial purpose determines the type of lease for purposes of regulation.

Lease – Contract to lease at future time

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Lease – Contract to lease at future time

Art. 2670. Contract to lease. A contract to enter into a lease at a future time is enforceable by either party if there was agreement as to the thing to be leased and the rent, unless the parties understood that the contract would not be binding until reduced to writing or until its other terms were agreed upon.

Lease – Term

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Lease – Term

Art. 2678. Term. The lease shall be for a term. Its duration may be agreed to by the parties or supplied by law. The term may be fixed or indeterminate. It is fixed when the parties agree that the lease will terminate at a designated date or upon the occurrence of a designated event. It is indeterminate in all other cases.

Art. 2679. Limits of contractual freedom in fixing the term. The duration of a term may not exceed ninety-nine years. If the lease provides for a longer term or contains an option to extend the term to more than ninety-nine years, the term shall be reduced to ninety-nine years. If the term’s duration depends solely on the will of the lessor or the lessee and the parties have not agreed on a maximum duration, the duration is determined in accordance with the following Article.

Revision Comment- 2004: This article imposes a quantitative limit on an otherwise unrestricted power of the parties to fix in advance the duration of the term of a lease. This limitation is dictated by public policy considerations. A lease for a duration of longer than ninety-nine years differs little from a perpetual lease. It binds the parties and their successors for a period much longer than most people are able to envision and thereby imposes upon them the risk of changing circumstances that they cannot anticipate. Such a lease also binds the property for too long a period and thus keeps it out of commerce for most practical purposes.

Art. 2680. Duration supplied by law; legal term. If the parties have not agreed on the duration of the term, the duration is established in accordance with the following rules:

(1) An agricultural lease shall be from year to year.

(2) Any other lease of an immovable, or a lease of a movable to be used as a residence, shall be from month to month.

(3) A lease of other movables shall be from day to day, unless the rent was fixed by longer or shorter periods, in which case the term shall be one such period, not to exceed one month.

Lease – Rent

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Lease – Rent

Art. 2675. The rent. The rent may consist of money; commodities, fruits, services, or other performances sufficient to support an onerous contract.

Art. 2676. Agreement as to the rent. The rent shall be fixed by the parties in a sum either certain or determinable through a method agreed by them. It may also be fixed by a third person designated by them. If the agreed method proves unworkable or the designated third person is unwilling or unable to fix the rent, then there is no lease. If the rent has been established and thereafter is subject to re-determination either by a designated third person or through a method agreed to by the parties, but the third person is unwilling or unable to fix the rent or the agreed method proves unworkable, the court may either fix the rent or provide a similar method in accordance with the intent of the parties.

Lease – Thing

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Lease – Thing

Art. 2673. The thing. All things, corporeal or incorporeal, that are susceptible of ownership may be the object of a lease, except those that cannot be used without being destroyed by that very use, or those the lease of which is prohibited by law.

Art. 536. Consumable things. Consumable things are those that cannot be used without being expended or consumed, or without their substance being changed, such as money, harvested agricultural products, stocks of merchandise, foodstuffs, and beverages.

Art. 2674. Ownership of the thing. A lease of a thing that does not belong to the lessor may nevertheless be binding on the parties.

Lease – Recordation of lease affecting immovables

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Lease – Recordation of lease affecting immovables

R.S. 9:2742 Notice of lease; requirements and effect. A(1) In lieu of recording a written lease or sublease or any amendment or modification thereof, as provided by Civil Code Article 3338, a party may record a notice of lease or sublease, signed by the lessor and lessee of the lease or sublease.

(2) Recordation of a notice makes the lease or sublease and any subsequent amendment or modification thereof effective as to third persons to the same extent as world recordation of the instrument evidencing it.

(3) The notice of lease must contain the following:

(a) A declaration that the property is leased, and the names and addresses of the lessor and lessee.

(b) A description of the leased property.

(c) The date of the lease, its term, and the provisions of any extensions and renewals of the term provided for in the lease.

(d) A reference to the existence of an option, right of first refusal, or other agreement of the lessor to transfer all or any part of the leased premises.

(e) If a sublease, the notice shall also contain reference to the recordation information of the primary lease or notice of lease that is subleased; however the omission of this information does not affect the efficacy of the notice.

B. A notice of lease may also designate a person authorized to certify in writing on behalf of a party the terms of the lease, whether it is in full force and effect, and the extent to which the obligations of the lease have been performed. The certification shall have the same effect that it would have if it were signed by the person on whose behalf it is made.

C.(1) A change in a lease with respect to any matter that is required to be included in a notice of lease is not effective as to a third person unless the parties records a signed amendment to the notice that describes the change.

(2) If the amendment is of a transfer of a party’s rights, the notice shall be signed by the transferor and transferee.

(3) If the amendment only designates a different person to certify the matters described in Subsection B of this Section, the amendment need only be signed by the person on behalf of whom the certification is to be made.

D. The effects of recordation of a notice of lease ceases:

(1) Upon recordation of an instrument signed by the parties to the lease or their successors declaring that the lease has terminated; or

(2) On the date that the lease may finally terminate as set forth in the notice of lease.

E. This Section does not apply to mineral leases that are subject to the provisions of the Louisiana Mineral Code.

Art. 2711. Transfer of thing does not terminate lease. The transfer of the leased thing does not terminate the lease, unless the contrary had been agreed between the lessor and the lessee.

Art. 2712. Transfer of immovables subject to unrecorded lease. In the absence of a contrary provision in the lease contract, the lessee has an action against the lessor for any loss the lessee sustained as a result of the transfer.

Lease – Definition of lease

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Lease – Definition of lease

Art. 2668. Contract of lease defined. Lease is a synallagmatic contract by which one party, the lessor, binds himself to give to the other party, the lessee, the use and enjoyment of a thing for a term in exchange for a rent that the lessee binds himself to pay. The consent of the parties as to the thing and the rent is essential but not necessarily sufficient for a contract of lease.