Ejectment proceedings may be initiated after an owner of the leasehold interest is delinquent by two (2) payments.

Pursuant to Real Property Article 8-107, if a ground rent has not been demanded and it has not been paid for a period of 20 years, the annual rent is extinguished. However, if the ground rent owner is under a disability (such as insanity, minority, etc.) when the 20 years expires, the ground rent owner has 2 years after removal of disability within which to assert his/her rights. Due to the difficulty of proving the absence of demand and/or payment for 20 years, many underwriters will not insure fee simple title .

A party may own the leasehold interest and the reversion, simultaneously, without a merger, which extinguishes the annual rent. Redemption is a matter of intent of the redeeming party. In order for the annual rent to be extinguished, the party owning the leasehold interest and the party owning the reversion must be identical and the last acquisition document must contain merger language. If the last acquisition document does not contain merger language, an owner of both the leasehold and reversion interest can convey (a) a leasehold interest or (b) a reversionary interest or (c) a fee simple interest. A conveyance of the fee simple interest to another party would extinguish the rent without necessity of merger language.

Ground rents are paid in arrears.

If you cannot verify payment of rent, payments due from the last verified receipt up to three years should be escrowed along with reasonable attorneys’ fees and expenses.

Pursuant to Real Property Article 8-104, the payment of rent to a prior owner of a ground rent is a discharge of liability until the leasehold owner receives actual notice of the transfer.

Pursuant to Real Property Article 8-109, uninterrupted possession for 12 months after expiration of a lease, which contains covenant of perpetual renewal, is conclusive presumption of renewal.

If a lease covers multiple lots, it must recite that each lot is liable for its own rent.

Sub-rents are created from leasehold estates. It may be an apportionment of an original rent or it may be an additional rent. A sub-rent must be for a period at least one day less than the original lease.

The Leasehold interest is transferred by an “Assignment” or “Deed of Assignment.” An Assignment contains special language in the granting clause and habendum indicating that a leasehold interest is being conveyed.
Fee simple title to ground rent properties are transferred by standard deed. The deed, however, contains special language in the habendum indicating that a ground rent property is being conveyed.