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Wednesday, October 05, 2011

Right to always Assign or Sublet a Lease

At last night's class, Long Island Landlord, a real estate agent inquired whether a landlord could draft a lease to a single family residence, which flat out precluded assignments or sublets. While indicating that a landlord may not, I could not recall the statute or the wording, which was the foundation for this rule and therefore agreed to provide it on the blog today.

Real Property Law §226-b(1) states: Unless a greater right to assign is conferred by the lease, a tenant renting a residence may not assign his lease without the written consent of the owner, which consent may be unconditionally withheld without cause provided that the owner shall release the tenant from the lease upon request of the tenant upon thirty days notice if the owner unreasonably withholds consent which release shall be the sole remedy of the tenant. If the owner reasonably withholds consent, there shall be no assignment and the tenant shall not be released from the lease.

Therefore, a landlord cannot fully prevent a tenant from a right to assign or sublease by unconditionally withholding consent unless the landlord is willing to release the tenant from the lease (in a 4 or more residential unit apartment, a landlord can never unreasonably withhold consent). A landlord should be mindful that releasing the tenant from the lease would result in the tenant being free and clear of all responsibilities, but allowing the assignment or sublease would result in the tenant plus an additional tenant being liable to the landlord, unless there is a novation accompanying the assignment or sublease, which is not required. Therefore, it would seem that except in special circumstances a landlord should only object to an assignment or sublease if they have good cause.

Real Property Law §226-b(6) states: Any provision of a lease or rental agreement purporting to waive a provision of this section is null and void.

Therefore, you cannot draft around this provision. Yet, there are certain properties the statue does not apply to such as a rent stabilized apartments. To be clear, the statute does apply to single-family residences.

WARNING - Read the statute prior to relying on this blog to be sure its applicable to your specific situation and to comply with its notice requirements.

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