ContractsIntermediateAlaska Exam

In Alaska, a 'ground lease' is typically characterized by:

AA lease of only the subsurface mineral rights
BA long-term lease of land only, with the tenant constructing and owning improvementsCorrect
CA lease for agricultural farming on state-owned land
DA short-term lease of a parking lot or recreational area, under typical circumstances

Why A long-term lease of land only, with the tenant constructing and owning improvements Is Correct

Answer B: A long-term lease of land only, with the tenant constructing and owning improvements

A ground lease is a long-term lease (often 50-99 years) of land only, where the tenant pays rent to the land owner and constructs, owns, and uses improvements on the leased land during the lease term. At the end of the lease, the improvements may revert to the land owner.

Exam Tip: Contracts

Contract questions frequently test the essential elements required for a valid contract. Remember: competent parties, mutual consent, lawful object, and sufficient consideration. Watch for void vs. voidable distinctions.

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