Distinction between Lease and License

The line of demarcation between a lease and a license is sometimes very thin. A lease is a transfer of an interest in immoveable property ownership of physical consists of a number of rights and the owner of such property when he creates a lease, transfers to the lessee a part of the rights of ownership, i.e, the right or enjoyment of the property for a period, for consideration. Suring the continuance of the lease the right of enjoyment of the property belongs to the tenant and not to the landlord. The right of ownership as well as the right of which it is composed are right in rem and not in personem and by the lease a right in rem is transferred to the lessee. On the other hand a “license” is merely a competence to do something which except for this permission would be unlawful. It does not confer any right in physical property. There is in the case of licensee only a personal agreement between the licensor and the licensee whereby the licensor agrees not to interfere with the doing of particular acts on property which is in his possession. No right in rem passes to the licensee.

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