Legal Case Summary
Street v Mountford [1985] AC 809
Summary: Whether exclusive possession creates a tenancy.
Facts:
The respondent, Street, granted a licence to the appellant, Mountford, to occupy two rooms at a weekly rent subject to 14 days’ notice of termination. The written agreement was titled a ‘licence agreement’ and contained a declaration that it did not create a tenancy. The respondent sought a court declaration that Mountford only had a licence. Mountford appealed to the House of Lords.
Issues:
If the agreement was merely a licence and not a tenancy then Mountford could not claim the right to a fair rent under the Rent Acts. The respondent argued that the parties had only intended to create a licence, not a lease, and the fact that the agreement was labelled a ‘licence’ meant that it should be treated as such if the other terms of the agreement were not conclusive. The appellant argued that what was important were the rights created, not simply the form of the agreement.
Decision/Outcome:
The appeal was allowed. A lease must grant exclusive possession of the property for a fixed or periodic term at a rent. It is the nature of the rights created which are important. Superficial labels are irrelevant. The only intention that was relevant was the intention to confer exclusive possession. An occupier of residential accommodation at a rent for a term is either a tenant or a lodger. They are a lodger if the landlord provides services or attendance which require him to have unrestricted access to the premises. Here, the landlord did not provide any services or attendance. Therefore, the agreement created a lease even though it was called a ‘licence’.
Updated 21 March 2026
This case summary remains accurate. Street v Mountford [1985] AC 809 continues to be the leading authority on the distinction between a lease and a licence. The core principle — that exclusive possession for a term at a rent creates a tenancy regardless of the label attached to the agreement — remains good law and is regularly applied by the courts. The article correctly notes the tenant/lodger distinction as set out by Lord Templeman.
One contextual point worth noting: the Rent Acts, which provided the immediate practical stakes in Street v Mountford, have substantially reduced relevance today. The Rent Act 1977 no longer applies to most new residential tenancies, which since 15 January 1989 are instead governed by the Housing Act 1988 (assured and assured shorthold tenancy regimes). However, the legal principle established in Street v Mountford remains fully applicable under the current statutory framework and in the general law of landlord and tenant. Students should also be aware that subsequent cases such as AG Securities v Vaughan and Antoniades v Villiers [1990] 1 AC 417 (heard together) developed and refined these principles, particularly in the context of shared occupation and sham arrangements.
