What Is a Licensing Agreement in Real Estate

However, the use of a license agreement instead of a lease agreement will not completely exclude all possibilities of dispute between the owner-licensor and the tenant-licensee. Whether or not the “self-help” used was peaceful (and therefore legal) or violent (and therefore illegal) is still the subject of legal disputes. However, if there is a valid license agreement, the owner-licensor is not obliged to readmit the licensee to the premises, even if it turns out that the self-help used was violent and not peaceful. In New York, the licensee`s only remedy is the triple damage that RPAPL § 853 provides for forced eviction. In the meantime, before a court decision, the owner-licensor is free to sublicense the use of the premises to another licensee. Home / Articles Published / Tenant Licensee, Licensee, Owner-Licensor, New York Eviction Process, Owner-Tenant Process, Good Faith License Agreement / Use of a License Agreement instead of a Lease, so if there is no written agreement, you may be dealing with a lease. However, just because a contract contains the details listed above doesn`t mean it`s a default lease agreement. To do this, the main control of what is done on the property must be in the hands of the tenant, not the owner. It should also be noted that a rental agreement cannot be revoked by the owner before the end of the term as long as no other contractual conditions have been violated.

Licenses, on the other hand, can be revoked at any time. In a typical license agreement, the licensor undertakes to provide the licensee with intellectual property rights such as the licensor`s technology, brand name or product creation know-how. In exchange for licensor`s intellectual property, licensee generally pays an upfront fee and/or license fee to the licensor. A licence fee is a continuing royalty paid for the right to use the licensor`s intellectual property. Lawyers for tenants whose clients fail to sign a license agreement in good faith can no longer guarantee that a judgment on the eviction will be delayed for up to six months. If their licensed customers do not cure their norm, customers are subjected to peaceful self-help expulsion from the licensed premises quickly and without further delay. Owners will no longer eagerly forego their income and overdue funds to ensure the recovery of ownership of the premises at any given time. The bargaining lever will shift in favor of the owner-licensor, who can either demand full payment from the defaulting licensee if he wants to avoid eviction, or demand peaceful ownership of the premises with the full support of the law. For homeowners frustrated with the right facts and properties using the latest computerized access systems, this is a long-awaited revolution. In May 2018, Nestlé and Starbucks entered into a $7.15 billion coffee license agreement. Nestlé (licensee) has agreed to pay $7.15 billion in cash to Starbucks (the Licensor) for the exclusive rights to sell Starbucks products (single-serving coffee, tea, bean bags, etc.) worldwide through Nestlé`s global distribution network. In addition, Starbucks receives royalties on packaged coffees and teas sold by Nestlé.

The courts have concluded that licences are leases where one or more of these characteristics are either completely absent from the agreement or are not sufficiently integrated into the licensor`s powers. However, the less control granted to the licensee, the more likely it is that the agreement will be a licence, since a licence does not grant autonomy, but simply allows a party to “provide services within an enterprise that are provided on premises owned by another person who has the power to monitor how the services are provided”. Nevertheless, it has been found that Licensor`s continued control over the prices charged by Licensee, hours of operation in the Licensed Space, and even the choice of Licensee`s employees does not guarantee that the Agreement will be considered a license and not a lease, since such controls can no longer be considered “no longer by a reasonably diligent landlord vis-à-vis a tenant for [any] Business would be required.” At present, real estate licensing agreements seem to be used mainly by authorized owners to short-term users: office spaces, laundry rooms, certain types of storage spaces and kiosks in shopping malls. It is clear that there is a market for such agreements. .