Don’t Confuse Subletting And Assignment Of Lease

By on February 18, 2018

Subletting occurs when a third party becomes an occupant of the property for a period of time, where there is an understanding that the original tenant will ultimately move back in.

It can also refer to a current tenant renting out part of the house to a subtenant.

Assigning a lease refers to a new tenant taking over the place of the original tenant. He or she will then assume the rights and responsibilities stated in the rental agreement.

This also means that the old tenant will not be responsible or liable to any future claims, while the new tenant will be the one responsible should you file for any damages.

In subletting, the original tenant remains liable for all the terms stipulated in the rental agreement.

While it can make practical sense for tenants to sublet in certain situations, landlords will reserve the right to accept or reject the new subtenant.

One of the most common reasons tenants sublet is when they face financial problems and have to rent out part of the house just to meet the rental obligations.

A subtenant may only have an agreement with the original tenant, making you powerless to go after him.

However, in a room mate situation where all room mates sign on the lease, a landlord will be able to enforce the terms of the lease on all parties.

Becoming confused between subletting and lease assignment can be a costly mistake to make as a landlord.

it is one of those things that you don’t even bother learning about until the shit hits the fan. By that time, it could be too late to gain back you leverage as a landlord.

One of the rules that could come in handy to a landlord is to remember that a new subtenant becomes an occupant only with the expressed consent of the landlord.

This means that if a landlord never provided expressed consent, the the subtenant is in fact, legally speaking, an unauthorized occupant.

It is also worth noting that when a tenant gets married, the spouse does not become accepted as a tenant by default. He or she is not bound to the lease automatically.

The original tenant is still solely responsible to adhere to the terms and conditions of the lease.

In such circumstances, in practice, people often wait till the expiry of the existing contract before drafting up a new one that includes the new occupants. Or a new contract is created to replace the old one.

Be mindful that the law does not obligate a landlord to accept a new resident.

While both subletting and lease assignment requires the landlord’s approval to come in force, it is important to note that a landlord does not have a direct landlord-tenant relationship with a sub-lessee.

The original tenant effectively becomes the landlord of the subtenant.

However, when there is a breach of lease caused by a subtenant, any eviction action will be against the original tenant since the landlord only has a contractual relationship with this party.

And if the eviction procedure is successful, both the tenant and subtenant will be forced to leave the premises.

In this case, since the lease agreement is terminated between landlord and tenant, it is implied that the agreement between tenant and subtenant is terminated as well.

As you can see, there is a very big difference between subletting and lease assignment.

To avoid potential legal pitfalls in future, it is essential to understand the key differences between the two and make contract decisions wisely with them in mind.



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