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A property is leased for manufacturing purposes. In the absence of a contrary contract, local law or…

Section 106(1) deems the manufacturing lease to be from year to year and terminable by either party on six months’ notice. Under subsection (2), the period runs from the…

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A property is leased for manufacturing purposes. In the absence of a contrary contract, local law or usage, what notice period does section 106(1) of the Transfer of Property Act, 1882 prescribe for either party to terminate the lease?

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Answer and explanation

Correct answer B

Section 106(1) deems the manufacturing lease to be from year to year and terminable by either party on six months’ notice. Under subsection (2), the period runs from the recipient’s receipt of the notice.

Option feedback

Option A

The default for a manufacturing lease is six months.

Option B

Section 106(1) supplies a six-month notice period for this lease.

Option C

Section 106(1) does not set a three-month period for this lease.

Option D

Sixty days is shorter than the statutory six-month period.

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