Assignments
An assignment is one of the two ways a tenant hands a lease off to someone else, and the defining feature is how much the tenant gives away.
8. Assignments
An assignment occurs when a tenant conveys their entire leasehold interest or all that remains of it to a third party.
- Unless the lease specifies otherwise, every tenant has the power of alienation and may convey all or part of their leasehold interest to a third party.
- This assignment may include the obligation to pay rent.
- Unless the lease provides otherwise, a tenant may make an assignment without the landlord’s knowledge or consent.
- An assignment surrenders the full interest and rights of the tenant to the assignee.
- Once a lease has been assigned, the landlord may proceed directly against the assignee to enforce terms of the lease (including the payment of rent).
- Even after assigning their rights, however, a tenant remains liable to the landlord for all their obligations under the lease agreement unless the parties have agreed otherwise. The landlord, in other words, may proceed against both the original tenant and the assignee to enforce the terms of the lease, [including the promise to pay rent].
An assignment conveys the tenant's entire remaining leasehold to a third party, the assignee. By default a tenant may assign without the landlord's consent, the landlord may then proceed directly against the assignee, and the original tenant remains liable unless released.
An assignment is one of the two ways a tenant hands a lease off to someone else, and the defining feature is how much the tenant gives away. In an assignment, the tenant conveys the entire leasehold interest, or all that remains of it, to a third party called the assignee. That word entire is the whole game: if the tenant keeps even a sliver of the term, a reversion at the end, that is a sublease, not an assignment. An assignment transfers everything that is left.
Now the power to do this. Unless the lease says otherwise, every tenant has the power of alienation. That means the tenant may convey all or part of the leasehold to a third party, and may do so without the landlord's knowledge or consent. The default rule is freedom to assign; landlord consent is required only if the lease puts a restriction in writing. So when the facts simply say the lease is silent, the assignment is good even though the landlord never approved it.
What does the assignment do? It surrenders the full interest and rights of the tenant to the assignee. The assignee steps into the tenant's shoes and takes the lease as it stands, and the assignment may include the obligation to pay rent. Because of that, once the lease has been assigned, the landlord may proceed directly against the assignee to enforce the terms of the lease, including the payment of rent. The landlord does not have to route everything back through the original tenant.
Assigning does not let the original tenant off the hook. Even after assigning their rights, the original tenant remains liable to the landlord for all their obligations under the lease, unless the parties have agreed otherwise. So the landlord ends up with two pockets to reach into: it may proceed against both the original tenant and the assignee, including for the promise to pay rent. A bare assignment, standing alone, does not release the original tenant; only an agreement to release does.
"Entire remaining term equals assign; keep a sliver equals sublease."
The boundary is whether anything is left over for the tenant.
Assignment = all that remains goes to the assignee.
"Assign freely unless the lease says no": power of alienation means the tenant may assign without the landlord's knowledge or consent, unless the lease restricts it.
"Assigning is not escaping": the original tenant remains liable unless the parties agreed otherwise, so the landlord can collect from both the assignee and the original tenant.
After assignment the landlord may go directly against the assignee.
entire term to a third party, no consent needed by default, landlord may pursue both, original tenant stays on the hook.
A tenant holds a lease with three years left to run. Without telling the landlord, the tenant conveys the whole three years to a third party, who moves in and takes over. The lease is silent about assignment. A year later the new occupant stops paying rent, and the landlord wants to know who he can collect from.
If the tenant had conveyed only the first two of the three years and kept the final year, that would be a sublease, not an assignment, because the tenant retained a reversion.
An answer saying the original tenant is RELEASED once the lease is assigned, or that the landlord may collect from only one party.
The original tenant remains liable for all lease obligations unless the parties agreed otherwise, and the landlord may proceed against BOTH the original tenant and the assignee.An answer that requires the landlord's consent for the assignment to be valid, or treats a bare assignment as a novation that discharges the tenant.
By default a tenant may assign without the landlord's knowledge or consent; only an agreement of the parties, not the assignment itself, releases the original tenant.An answer that labels a transfer of less than the entire remaining term an assignment, or labels a transfer of the entire term a sublease.
An assignment conveys the ENTIRE remaining term; if the tenant keeps any reversion, the transfer is a sublease.A correct outcome (landlord can collect from the tenant, or sue the assignee) supported by the wrong reason, such as the assignment being invalid or the assignee merely occupying the premises.
Name the operative rule: the original tenant remains liable on the lease, and the landlord's direct action against the assignee flows from the assignment itself.the stem gives you a tenant who hands the lease to a third party, then asks who is bound, whether the transfer was valid, or whether the landlord can collect from the tenant, the new occupant, or both.
classify the transfer: did the tenant convey the entire remaining term (assignment) or keep a reversion (sublease)?
Then run the assignment checklist.
Was consent needed?
Not unless the lease says so.
Can the landlord go directly against the assignee?
Yes.
Is the original tenant still liable?
Yes, unless the parties agreed to release him.
The instant you see a transfer of the whole remaining term plus a question about liability, expect a distractor claiming the assignment released the original tenant or that consent was required, and reach for both the continuing-liability rule and the default power to assign.
A tenant held a lease on a storefront with four years left to run. The written lease said nothing about transferring the leasehold. Wanting to relocate, the tenant conveyed all four remaining years to a new business and moved out, never mentioning the transfer to the landlord. When the landlord learned of it, he objected that he had never approved the new occupant and demanded that the new business vacate.
Was the transfer to the new business effective?
A tenant assigned the entire remaining term of her apartment lease to an assignee, who agreed to take over the rent. The lease was silent about assignment, and the tenant and landlord never discussed releasing the tenant from her obligations. Several months later the assignee fell behind on the rent. The landlord sought to recover the unpaid rent from the original tenant, who protested that she had given up the lease and no longer lived there.
May the landlord recover the unpaid rent from the original tenant?
A tenant assigned all that remained of his commercial lease to an assignee, who took possession and ran a shop from the premises. The assignment expressly passed along the obligation to pay rent, and the lease did not restrict assignment. After two months the assignee stopped paying rent altogether. The landlord, rather than chasing the tenant who had moved on, wanted to bring an action straight against the assignee for the rent now due.
May the landlord proceed directly against the assignee for the unpaid rent?
A tenant held a lease with three years left. She transferred her interest to a third party and described the deal in writing. Under the transfer, the third party would hold the premises for the full three years remaining, with nothing coming back to the tenant at the end of that period. The tenant later disputed whether she had made an assignment or merely a sublease.
Which transfer did the tenant make, and why?
A tenant assigned the remainder of her lease to an assignee. The lease was silent about assignment, and the parties never agreed to release the tenant. When the rent went unpaid, the landlord asked whom he could pursue for the money owed.
Whom may the landlord pursue for the unpaid rent?