Leasehold Estates Flashcards
What is a [tenant’s] assignment?
An assignment occurs when a tenant transfers the entire remaining interest in the lease to a third person (assignee).
When may or may not a tenant assign their lease?
Absent an express prohibition in the lease, a tenant may transfer his interest in the leasehold estate. It is permissible for a lease to contain a provision against assignment without the consent of the landlord.
Generally, a landlord may withhold consent to an assignment for any reason unless it violates public policy. There is an emerging trend, but still a minority stance, that a landlord may not unreasonably withhold consent solely based on a capricious reason such as personal taste, convenience or sensibilities.
What is Surrender?
Surrender occurs when the tenant gives up his interest in the leasehold estate in writing (where the unexpired term is more than one year), with no intent to return, and defaults on rent. Upon surrender, a tenancy may terminate.
What are a Landlord’s remedies and damages for a Tenant’s breach and abandonment?
If the tenant unjustifiably abandons the property, the landlord can either do nothing and sue for damages or the landlord may repossess the property.
Traditionally, the landlord had no duty to mitigate but the landlord was limited to sue only for recovery of rent due at the time of the suit, not rent in the future. Now a majority of courts hold that a landlord has a duty to make reasonable efforts to mitigate damages.
Where the landlord repossesses the property, the tenant’s liability will depend on whether or not the landlord accepted surrender of the premises.
What Damages does a Landlord have if they accept a Tenant’s Surrender?
If the landlord accepts surrender of the property, the abandoning tenant is free from rent liability accruing after abandonment.
What Damages does a Landlord have if they do not accept a Tenant’s Surrender?
If the landlord does not accept surrender, then the landlord could sue the tenant for damages consisting of unpaid rent as well as the difference between future rent and the fair market or re-let rental value.
