## Facts

- A building owner and Weiman executed a written instrument titled “Lease” granting Weiman use of the building’s laundry room for five years with an option to renew for five more years.
- The owner agreed to furnish needed utilities, receive 25% of Weiman’s gross receipts every six months, and not permit competing coin-operated laundry facilities in the building during the term.
- Weiman installed and operated coin-operated laundry machines in the laundry room and posted signage with his name and telephone number.
- Butterman later purchased the building; the sale contract did not list Weiman as a tenant.
- Before closing, Butterman inspected the building, saw the laundry machines and Weiman’s posted sign, but did not inquire into Weiman’s rights or review any agreement.
- After the purchase, Butterman removed Weiman’s machines and installed machines from another laundry company.
- Weiman sued, claiming a leasehold right to continue operating in the laundry room and to exclude competing machines.

## Issues

1. Whether the agreement created a leasehold interest (binding on a subsequent purchaser with notice) or merely a revocable license.
2. Whether Butterman had actual or constructive notice of Weiman’s interest sufficient to bind Butterman to the agreement.

## Decision

- The appellate court affirmed judgment for Weiman.
- The court held the agreement created a lease, not a license, because it granted exclusive possession of a defined space (the laundry room) for a fixed term in exchange for consideration.
- The court held Butterman took the property subject to the lease because Weiman’s visible occupation (machines and signage) put Butterman on inquiry notice of Weiman’s rights.
- Butterman’s removal of the machines and substitution of a competing operator violated Weiman’s leasehold rights.

## Legal Principles

- The legal effect of an occupancy agreement depends on its substance; labels are relevant but not controlling.
- A lease exists when an agreement grants exclusive possession and control of a definite portion of real property for a term in exchange for consideration, thereby conveying an estate for the term.
- A license is a personal, revocable privilege to use land that does not transfer possession or an interest in the land.
- Rent may be measured as a percentage of receipts; the form of consideration does not prevent an agreement from being a lease if exclusive possession for a term is granted.
- A purchaser who observes a third party in open, visible possession of part of the premises has a duty to inquire into the nature of that possession and is charged with notice of the rights such inquiry would reveal.
- Existing leases bind subsequent purchasers who have actual notice or constructive (inquiry) notice of the tenant’s possession.

## Conclusion

The court treated the laundry-room agreement as a lease because it conferred exclusive possession of a specific space for a fixed term, and it enforced that lease against a later purchaser who failed to investigate visible signs of the tenant’s occupancy.


Weiman v. Butterman, 260 N.E.2d 321 (Ill. App. Ct. 1970)