Brief of Cook v. University Plaza

Facts

College students living in University Plaza, a privately-owned university dormitory, sued the dorm to recover interest payments on their security deposits under an Illinois statute that requires landlords to pay interest on tenants' security deposits. Each student signed a contract with the dorm entitled "Residence Hall Contract Agreement," which governed the student resident's use of dorm facilities and services. Under the contract, the dorm retained the right to assign rooms, to require room changes, and to authorize or deny room or roommate changes. The contract also provided that the dorm was to be closed during certain holidays and during semester breaks and that no one was permitted to stay in the dorm during these periods. Finally, the contract stated that "it is not the intention of the parties hereto to create a landlord-tenant relationship."

Procedural History

The dorm residents sued as a class, and the trial court granted the defendant's motion to dismiss the class action.

Issue

Were the residence hall contracts leases which created a landlord-tenant relationship between the students and the dormitory, thus requiring the dormitory to pay interest on the students' security deposits?

Holding

No. The appeals court, finding that the contracts were licenses rather than leases, affirmed the trial court's dismissal of the plaintiffs' complaint because the statute applied to leases only.

Reasoning

A contract is characterized as a lease or license by determining "the legal effect of its provisions."

A lease is a transfer of possession; a license merely gives a party the right to use property subject to the management and control of another party.

Application to facts

The residence contract is a license because it does not give the resident a right to exclusive possession of a certain premises.

Because the dorm could move students from room to room, no resident had a possessory interest in any specific property -- which is a necessary characteristic of a lease.