Legal Question in Real Estate Law in Canada
Subletting and renewing lease contract
Section 9 titled Assignment and Subletting
9.1 the tenant covenants with the landlord that: the rights of the tenant under this lease shall not be transferred assigned sold or mortgaged and the tenant shall not sublet the whole or any part of the leased premises nor grant any concession or licenses within or with respect to the leased premises to any party without in any case the prior written consent of the landlord which consent the landlord may not unreasonably withhold provided that it will be reasonable for the landlord to withhold it consent if:...
Section 16 titled Legal Relationship
16.3 Successors and Assigns - Subject to the provision of this lease respecting assignment by the tenant this lease shall inure to the benefit of and be binding upon the landlord its successors and assigns and the heirs executors administrators and other personal legal representatives successors and permitted assigns of the tenant.
If a landlord allows a tenat to sublet and the lease term is completed does the subleasee have the rights to sign a renewal or can the landlord request the subleasee to move out? Also does section 16.3 have anything todo with the subleasee getting the rights of the leasee and if not could you explain it?
1 Answer from Attorneys
Re: Subletting and renewing lease contract
The answer depends, at least in part, on the terms of the assignment whereby the subtenant went into occupation of the premises. Normally a document is executed for the assignment that indicates the extent of the rights being acquired by the subtenant. The documents (lease and assignment agreement) may be able to be interpreted as providing that the right of renewal was assigned to the subtenant. More likely however the case is that, if the lease provides a right of renewal to the tenant, and the lease is not in default, the tenant can execute a renewal and presumably continue to sublet. However, this would mean the tenant continues to be liable for the subtenant's performance of the lease. It is common, if the subtenant has performed the lease without default, for the landlord to enter into a new lease with the subtenant.
Section 16.3 is written as being subject to the terms of any assignment. If there was no assignment document, or it is silent as to the right of renewal, then arguably the subtenant acquired the right of renewal. A section like section 16.3 is normally boilerplate inserted with little thought and intended to bind the successors of the tenant rather than grant any rights. In your case it might provide you with some assistance.
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