Does CPO s.31 apply to equitable leases? Does the tenant need to sign an agreement for lease to bring the lease within CPO s.31?

CPO s.31 allows assignees of the reversion to enforce the terms of a written agreement for lease. This is true even though only the landlord has signed the written agreement.

In Rye v Purcell ([1926] 1 KB 446) L’s authorised agent wrote to T granting T a lease of property. T remained in possession under the terms of the lease and paid the rent mentioned in the letter. L assigned the reversion and the assignee brought an action claiming that T had failed to keep the property in repair in breach of the terms of the written agreement. T argued that the assignee did not have the benefit of the covenant. It was accepted that the equivalent of section 31 of the Conveyancing and Property Ordinance covered agreements for lease. T argued, however, that there was no agreement as T had never signed any written agreement. The assignee succeeded. The letter was a sufficient agreement to bring the lease within CPO s.31. Further, either party could have obtained specific performance of the agreement based on the landlord’s signature or the tenant’s remaining in possession. In any event, privity of estate arose where T went into possession under the terms of a deed or written agreement executed or signed by L without any need for T to execute or sign a counterpart.

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