Whether a landlord can evict a tenant with the expiry of a lease?

A common dispute in the area of property law in Bangladesh arises from dissensions between a landlord and a tenant in relation to continuation of a lease after its expiry. A tenant desires to remain in possession of a property even after the efflux of the period of the lease whereas the landlord seeks to dislodge the tenant with the end of the lease period.

Usually tenants intend to prolong their possession of a property when they have leased a property for commercial purposes and during the period of lease, they have established a business, which is in need of the property to maintain its steady operations.

This avenue of property law gives rise to a conflict of interests between the landlord’s right to his property and the tenant’s indispensable need to possess the property in order to ensure smooth functioning of his or her business. This paper will highlight the position of both the parties under the laws of Bangladesh. The analysis will involve a perusal of the governing legislations and judgments of the Supreme Court of Bangladesh.

Eviction

In the context of property law, a lease is defined in light of immoveable property and its statutory effect is that it is a transfer of a right to enjoy such property, made for a certain time, express or implied, or in perpetuity, in consideration of a price paid or promised, or of money, a share of crops, service or any other thing of value, to be rendered periodically or on specified occasions to the transferor by the transferee, who accepts the transfer on such term.[1] To put simply, a lease is a transfer of right in an immoveable property to enjoy the property for a specified period of time or for perpetuity, as agreed between the transferor and the transferee, in exchange for consideration. The statutory definition of lease would lead one to conclusion that since the transfer of a right under a lease can be subject to a specific period of time, a tenant’s right to possess a property should also cease with the end of the period of lease. Such a conclusion will not be a fallacy since Section 111 of the Transfer of Property Act, 1882 (the “TPA”) lists “efflux of time” as a ground of determination of lease seems at this stage that the law is pretty one-sided as it favours the landlord. There should thus not be any argument when a landlord attempts to evict a tenant after the period of lease has lapsed. However, under the laws of Bangladesh, this is not so simple and that is the beguiling part.

The Premises Rent Control Act, 1991 (the “PRCA”) (PRCA has repealed the previous Premises Rent Control Ordinance, 1963 (the “Ordinance”)) provides the reliefs which may be invoked by tenants in cases of eviction by landlords. Rent Control legislation is a special law, which gives a greater protection to a tenant against eviction so long he pays rent to the full extent allowable by the Ordinance (now the PRCA) and performs the conditions of the tenancy.[2]

It is imperative that we note a difference between the PRCA and the TPA before we move into discussing the protections available to tenants under the law. The difference lies in respect of a tenancy which has expired with efflux of time. Under the TPA, the tenant can “hold over” after expiry of lease and the effect of “holding over” is provided for in Section 116 of the TPA as follows

116.   Effect of holding over –

            If a lessee or under-lessee of a property remains in possession thereof after the determination of the lease granted to the lessee, and the lessor or his legal representative accepts rent from the lessee or under-lessee, or otherwise assents to his continuing in possession, the lease is, in the absence of an agreement to the contrary, renewed from year to year, or from month to month, according to the purpose for which the property is leased, as specified in section 106.”

The point to note here is that under section 116 of the TPA, the option is with the landlord to accept or not to accept rent from the lessee or under-lessee after the determination of the lease with efflux of time.[4] If the landlord refuses to accept rent, that will be the end of the tenancy, there is no “holding over” and the tenant renders himself liable to eviction.[5]

However, this option is given to the tenant by the PRCA. If an individual wish to continue a tenancy, it is he or she who must be ready and willing to pay rent to the full extent allowable by the PRCA. If he sent the rent after expiry of lease by money order and the landlord refuses to accept, and if he makes a timely deposit of the same to the House Rent Controller and continues to do so, he will be protected from eviction.[6]

His continuance of the tenancy is not dependent on the landlord’s acceptance of the rent. This position is consistent with the definition of “tenant” provided under section 2(e).

“tenant” means any person by whom, or on whose account, rent is payable for any premises and includes a legal representative as defined in the Code of Civil Procedure, 1908 (V of 1908), and a person continuing in the possession after the termination of a tenancy in his favour;

.…”

If a tenant remains in possession after expiry of a lease and continues to pay rent, then he becomes a statutory tenant.[7] 

It can be discerned from above that a tenant can thus avail protection under the PRCA. The protection that a tenant can resort to in cases of eviction by landlord has been provided in Section 18 of the PRCA, Section 18(1) of which states that:

18.     No order for ejectment ordinarily to be made if rent paid at allowable rate.–

 (1)       Notwithstanding anything contained in the Transfer of Property Act, 1882 (IV of 1882) or the Contract Act, 1872 (IX of 1872), no order or decree in favour of the landlord for the recovery of possession of any premises shall be made as long as the tenant pays rent to the full extent allowable by this Act and performs the conditions of the tenancy: … ”

The above provision is available to the landlord for filing a suit for eviction. However, a landlord must serve a notice under Section 106 of the TPA prior to filing a suit for eviction. Lease of immovable property is created under Section 105 of the TPA and as such, statutory notice must be given under Section 106 of the TPA for termination of tenancy.[8] A notice under Section 106 of the TPA is mandatory in cases of eviction under the PRCA as well, because a tenancy is created under the TPA and Contract Act, 1872 (the “CA”) and those two Acts are not completely excluded by the provisions of the PRCA.[9] The PRCA has not excluded the operation of Section 106 of the TAP either expressly or by implication.[10] Therefore, a notice under Section 106 of the TPA is mandatory in case of eviction under the PRCA.[11]

Even if a landlord complies with the requirement of serving a notice, the question that arose at the beginning of the paper still stands firm, which is whether the landlord can eject the tenant on grounds of expiry of the lease. The answer to this question was provided by the Apex Court of Bangladesh in the case of Abdul Aziz Vs Abdul Majid 46 DLR (AD) (1994) 121.

The case was decided in light of Section 18 of the Ordinance which is equivalent to Section 18 of the PRCA. In this case, it was decided that a tenant cannot be ejected solely on the ground that the lease period has ended. Mustafa Kamal J in Abdul Aziz Vs Abdul Majid stated that:

“22.     …section 18(2) of the Premises Ren Control Ordinance, 1963 (now Premises Rent Control Act, 1991) has given a protection to the tenant from eviction when the period of lease has expired, provided that the tenant is ready and willing to pay rent to the full extent allowable by the aforesaid legislations. If he is to be evicted, then the landlord will have to make out a case of default in the payment of rent and/or under any of the clauses (a)-(e) of the proviso to sub-section (1) of section 18. The tenant cannot be evicted solely and only on the ground of expiry of the period of lease, even if a notice under section 106 of the Transfer of Property Act is validly served before filing of the suit. A notice will only be an idle formality in that case, leading to no remedy.”

He has also provided justification under para 23 regarding the matter which is given as follows

 “23.    The reason in simple. All leases are created under the Transfer of Property Act and the Contract Act. If the Premises Rent Control Ordinance was not there, a tenancy terminates with the expiry of the period of lease because section 111 of the Transfer of Property Act expressly provides that “a lease of immovable property determines (a) by efflux of time limited thereby”. But to give protection to the tenants, section 18 of the Premises Rent Control Ordinance makes a significant departure from the Transfer of Property Act. Sub-section (1) of section 18 protects a tenant from eviction “as long as the tenant pays rent to the full extent allowable by this Ordinance and performs the conditions of the tenancy”. This protection is given “notwithstanding anything contained in the Transfer of Property Act, 1882, or the Contract Act, 1872”. The protection is not available if he is a defaulter and/or in the contingencies mentioned in clauses(a)-(e) of the proviso to sub-section (1) of section 18, namely.

            (a) where the tenant has done any act contrary to die provisions of clause (m), clause(o) or clause (p) of section 108 of the Transfer of Property Act, 1882, or

(b) where, in the absence of any contract to the contrary, the tenant has, without the consent in writing of landlord, sublet the premises in whole or in part, or

(c) where the tenant has been guilty Of conduct which is a nuisance or any annoyance to occupiers of adjoining or neighbouring premises, or

(d) where the tenant has been using the premises or part thereof or allowing the premises or part thereof to be used for immoral or illegal purposes, or

(e) where the premises are bonafide required by the landlord either for purposes of building or rebuilding or for his own occupation or for the occupation of any person for whose benefit the premises are held, or where the landlord can show any cause which may be deemed satisfactory by the Court.

…”

Section 18 of the Ordinance and the current PRCA limits the causes of eviction. However, the list can be regarded as non-exhaustive as Section 18(1)(e) allows the Court to order eviction of a tenant where the landlord can show any cause which may be deemed satisfactory by the Court. What will amount to a satisfactory cause under this proviso was not spelled out by the Court, however, Mustafa Kamal J stated that:

“24.     … Anything and everything is not a satisfactory cause…”

Moreover, it must be noted that Section 18(2) of the PRCA vividly excludes the expiry of a lease or transfer of interest of the landlord from being classified as a satisfactory cause under Section 18(1)(e) of the PRCA.

The above decision of the Appellate Division of the Supreme Court of Bangladesh has made it clear that a landlord cannot evict a tenant by filing a suit on the sole ground that a lease has expired.  A protection from eviction can be availed by the tenant under the PRCA. The expiry of lease may be a good ground of eviction under the TPA, but shall not of itself be deemed to be satisfactory cause within the meaning of clause (e) of sub-section (1) of Section 18 of the PRCA.[12] Furthermore, the non-obstante clause of sub0section (1) of Section 18 of PRCA makes it clear that the provision of TPA and the CA will not apply in respect of this section.[13] If a landlord is to ensure eviction of the tenant, then the landlord must have additional reasons for eviction apart from expiry of the period of the lease and those reasons must fall within any of the grounds listed by Section 18(1) of the PRCA.

[1] Section 105 of Transfer of Property Act, 1882

[2] Latifur Rahman J in Para 11, Abdul Aziz Vs. Abdul Majid 46 DLR (AD) (1994) Page 123

[3] Mustafa Kamal J in Para 26, Abdul Aziz Vs. Abdul Majid 46 DLR (AD) (1994) Page 126

[4]Mustafa Kamal J in Para 27, Abdul Aziz Vs. Abdul Majid 46 DLR (AD) (1994) Page 126

[5] IBID

[6] IBID

[7] Latifur Rahman J in Para 11, Page 123  and Mustafa Kamal J in Para 28, Abdul Aziz Vs. Abdul Majid 46 DLR (AD) (1994) Page 126

[8]Latifur Rahman J in Para 13, Abdul Aziz Vs Abdul Majid 46 DLR (AD) (1994) Page 123

[9] Mustafa Kamal J in Para 29, Abdul Aziz Vs Abdul Majid 46 DLR (AD) (1994) Page 127

[10] IBID

[11] IBID

[12] Mustafa Kamal J in Para 25, Abdul Aziz Vs Abdul Majid 46 DLR (AD) (1994) Page 126

[13] Latifur Rahman J in Para 11, Abdul Aziz Vs Abdul Majid 46 DLR (AD) (1994) Page 122 and 123

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Mohammad Taqi Yasir

Mohammad Taqi Yasir is a LLB graduate of the University of London International Programmes. He is one of the 15 students around the world who was awarded first class in 2017 by the University of London. After completing his LLB in 2017, he commenced his legal career at a leading law firm in Dhaka and is currently practicing in civil law, more specifically in the areas of company law. He is also an entrepreneur holding board position at a digital marketing and event management company, Planet X Incorporated. His interests extend to the field of philanthropy as well and he current performs the role of an advisor for a charity called Born To Smile and holds the position of Vice President of a social enterprise named, Footsteps Foundation.

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