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a. Majority rule: The majority of courts hold that the fixed term and the option period are added together; if the total exceeds one year (or whatever the statutory period is), a writing is necessary. Rest. 2d, Reporter’s Note to §2.1.

b. Minority rule: But some courts hold that as long as the fixed period does not exceed one year, it is valid regardless of the existence of an option. Rest. 2d, §2.1, Comment c, takes this minority position. (But the Restatement suggests that, when the validity of the option itself is in question, a writing should be required if the option plus the original period exceed the statutory period; Rest. 2d, §2.5, Comment c.)

4. Effect of non-compliance with Statute: If the lease is one that is required to be in writing, and it is not, the lease is not necessarily void. If the tenant takes possession, this fact together with the fact that the invalid lease shows that entry is made with the landlord’s permission will probably create a tenancy at will (infra, p. 160). If, in addition to taking possession, the tenant pays rent, a periodic tenancy is created in most states (infra, p.159). 1 A.L.P. 218.

5. Recording of lease: Apart from the Statute of Frauds, nearly all states require that leases beyond a certain length be recorded in the public records. (See infra, p. 360.) 4 A.L.P. 551. In many cases, the cut-off is seven years. Generally, the effect of a failure to record where recordation is required is that the lease is not binding upon a subsequent purchaser from the landlord. Powell, Par. 222, p. 86.

B. The estate for years: The most common type of leasehold is the estate for years. The estate for years is any estate which is for a fixed period of time. Thus the lease does not have to be for one or more years; a six-month lease would qualify.

1. No notice needed to terminate: An estate for years, by definition, contains its own termination date. Accordingly, no additional notice of termination is required to be given by either party; on the last day, the tenancy simply ends, and the tenant must leave the premises.

2. Maximum duration: Most states do not impose any outer limit on the length of a tenancy for years; thus a 2,000-year tenancy would be upheld in most states. But a few states have statutorily imposed length limits, at least with respect to certain kinds of leases, such as those for agricultural or mining properties. See 1 A.L.P. 211.

C. The periodic tenancy: The periodic tenancy is a tenancy which continues from one period to the next automatically, unless either party terminates it at the end of a period by notice. 1 A.L.P. 221-22. Examples are a tenancy from year-to-year, month-to-month, or week-to-week.

1. Distinguished from tenancy for years: Thus while a tenancy for years automatically expires when it reaches the end of its stated term, the periodic tenancy continues indefinitely, until terminated by one of the parties by proper notice.

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