Transfer of Leaseholds Flashcards
Assignment vs Sublease - generally
In the absence of some prohibition and a lease, a tenant may:
Assignment: freely transfer their interest in whole, meaning a transfer of the entire remaining term of the lease
Sublease: we transferred their interest in part, meaning the tenant has retained some part of the remaining term, other than a right to re-enter upon breach.
In the lease, a landlord can prohibit a tenant from assigning or submitting without the Landlord prior written approval. However, once a landlord consents to one transfer by a tenant, the landlord waves the right to object a future transfers by that tenant, unless the landlord expressly reserves the right.
Assignment - generally
And assignee stands in the shoes at the original tenant in a direct relationship with the landlord. That is the assignee, and the landlord are in privity of a state, and each is liable to the other on all covenants in the least that run with the land. After assignment, the original tenant is no longer in privy of a state with the landlord, but their lease contract remains in effect and enforceable. In other words, the original tenant remains in privity of contract and is this liable on the contract obligations, such as to pay rent. 
The assignee and the landlord are not in privity of contract because they never exchanged the original promissory words of contract that created the lease. 
Assignment - covenants that run with the land
The covenant runs with the land if the original parties to the least so intended and if the covenant touches and concerns the land. That is, benefits the landlord and burdens the tenant or vice versa with respect to their interest in the property.
Assignment - rent covenants
Because a covenant to pay rent rent with the land, the assignee owes rent directly to the landlord. If a tenants assignee fails to pay rent, or breaches another cabinet, the landlord can sue the assignee because of privity of estate and, if the assignee cannot pay, Landlord can also sue the original tenant because of privity of contract. If the assignee reassign the leasehold interest, their privity of estate with the Landlord ends, and they have no liability for the subsequent assignee’s failure pay rent.
Sublease - generally
The sublessee is the tenant out of the original lessee and usually pays rent to the original lessee, who then pays the landlord. A sublease arises when the original tenant transfers less than her entire interest to another. The result of a sublease is that the landlord and the sublessee are in neither of state nor privity of contract. Instead, the sublessee is responsible to the original tenant and vice versa. Thus, a sublessee is not personally liable to the landlord for rent or for the performance of any of the covenants in the main lease unless the sublessee expressly assumes the covenants.
Sublease - landlord’s remedies
The landlord may terminate the main lease for nonpayment of rent or breach of other covenants if the lease so states or the power is given by statute. The sublease automatically terminates with the main lease.
Sublease - rights of sublessee
A sublessee cannot enforce any covenants made by the landlord in the main lease, except a residential sublessee may be able to enforce the implied warranty of habitability against the landlord.
Covenants against assignment or sublease
In the lease, a landlord can prohibit a tenant from assigning or sublet without the landlord prior written approval. A valid covenant against assignment is considered waived if the landlord was aware of the assignment and did not object, for example, by knowingly accepting rent from the assignee.
Once a landlord consents to one transfer by a tenant, the landlord waves the right to object to future transfers by the tenant, unless the landlord expressly reserves the right.
Lease covenants restricting assignment and sublease are strictly construed against the landlord. Thus a cabinet prohibiting assignment does not prohibit subleasing and vice versa.
Also note, if a tenant assigns or sublet in violation of a lease provision, the landlord usually may terminate the lease or sue for damages, but the transfer is not void.
Assignment by landlords - generally
A landlord may assign the rents and reversion interest they own. This is usually done by deed when the landlord conveys a building to a new owner. The tenants consent is not required.
Assignment by landlords - rights of assignee against tenants - attornment
Once tenets are given reasonable notice of the assignment, they must recognize and pay rent to the new owner as their landlord. The benefit of all tenant covenants that touch and concern the land run with the Landlord estate’s to the new owner. 
Assignment by landlords - liabilities of assignee to tenants
The burden of the landlords covenant that touch and concern the land runs with the Landlord estate to the assignee. Thus, the assignee is liable for the performance of those covenants. The original landlord also also remains liable on all the covenants they made in the lease.
Landlord’s tort liability - common law of caveat lessee (CLAPS)
The common law norm is: let the tenant beware. In tort, a landlord was under no duty to make the premises safe. The five exceptions to caveat lessee are: 
Common areas
Latent defects
Assumption of repairs
Public use rule
Short term lease of furnished dwelling
Landlord’s tort liability - common law of caveat lessee - common areas
The landlord has a duty of reasonable care and maintaining all common areas. For example, hallways, stairwells, or elevators.
Landlord’s tort liability - common law of caveat lessee - latent defects rule
A landlord must warn a tenant of hidden defects, meaning a dangerous condition that the tenant couldn’t discover by reasonable inspection, of which the landlord has knowledge or reason to know. Otherwise, the landlord will be liable for any injuries resulting from the condition. If the tenant accepts the premises after disclosure, the tenant assumes the risk and the landlord is no longer liable in. Note that the landlord obligation and tour is a duty to warn, not a duty to repair.
Landlord’s tort liability - common law of caveat lessee - assumption of repairs
While in Landlord is under no duty to make repairs, once repairs are undertaken, the landlord must complete them with a reasonable care. Meaning that if the landlord makes the repairs negligently, the landlord may be liable to the tenant.
Landlord’s tort liability - common law of caveat lessee - public use rule
In Landlord, who leases public space, for example, it convention hall or a museum, and who should know, because of the significant nature of the defect and the short length of the lease, but a tenant will not repair it, is liable for any defects on the premises that caused injury to members of the public.
Landlord’s tort liability - common law of caveat lessee - short-term lease of furnished dwelling
Landlord, who rents a fully furnished premises for a short period, for example, a summer cottage, is under a stricter duty. Such landlords are responsible for any defective condition which proximately injures a tenant, whether or not they knew of the defect.
Landlord’s tort liability - modern trend: general duty of reasonable care
Many courts now hold that a landlord owes a general duty of reasonable care toward residential tenants, and will be held liable for injuries in tort resulting from ordinary negligence, if the landlord had notice of a defect and an opportunity to repair it.
Landlord’s tort liability - modern trend: general duty of reasonable care - defects arising after tenant takes possession
Landlord generally is held to have notice of defects existing before the tenant took possession, but is not liable and tort for defects arising after the tenant takes possession unless the landlord knew or should’ve known of them.
Landlord’s tort liability - modern trend: general duty of reasonable care - legal duty to repair
If the Landlord has a statutory duty to repair, for example, by housing code, the landlord is liable in tort for injuries resulting from the landlords failure to repair or negligence in making repairs. 
Landlord’s tort liability - modern trend: general duty of reasonable care - security
Some courts hold landlords liable for tenant injuries inflicted by the criminal conduct of third parties in cases where the landlord failed to comply with housing code, provisions dealing with security, maintain ordinary, security measures, or provide advertise security measures.
Landlord’s tort liability - tenant’s liability
The duty of care owed by the tenant, as an occupier of land, to third persons is the normal premises liability rules. 
Fixtures - generally
A fixture is chattel that has been so fixed to land that it has ceased being personal property and has become part of the reality. A fixture passes with the ownership of the land and must stay put.
Fixtures - chattels incorporated into structure
Two ways to tell that a given, chattel is a fixture:
First, when items are incorporated into the reality so that they lose their identity.
Second, it is a fixture when its removal would cause considerable damage to the premises. 
Fixtures - common ownership cses
A common ownership case is one in which the person who brings the chattel to the land, owns both the chattel and the land, as when someone installs a furnace in their own home. That item is a fixture if the party who made the annexation objectively intended to make the item part of the reality. This intention is determined by: the nature of the article, the manner of attachment, the amount of damage that would be caused by his removal, and the adaptation of the item to the use of the realty. 
Fixtures - divided ownership cases - generally
In divided ownership cases, the Cell is owned and brought to the realty by someone other than the landowner, for example, by a tenant licensee or trespasser. Accession describes the annexor’s intent to make the chattel a permanent part of the real estate.
Fixtures - divided ownership cases - landlord-tenant
Suppose that a tenant installs a chandelier on the leased premises ceiling. How can you tell whether the tenants installation qualifies as a fixture? And agreement between the landlord and the tenant is controlling. Absent an agreement, a tenant is deemed to lack the intent to permanently improve the property. Thus they may remove the annex if removal does not substantially damage the premises or destroy the chattel. Annexed chattel must be removed by the end of the lease term or with a reasonable time after termination of an indefinite tenancy, and the tenant is responsible for repairing any damage caused by the removal.
Fixtures - divided ownership cases - life tenant and remainderman
The same rule applies in the life tenant remaindermen context as in landlord, tenant situations, except that the life tenants representative may remove annexations within a reasonable time after the life tenants death.
Fixtures - divided ownership cases - licensee or trespasser and landowner
Licenses are treated much like tenants, whereas trespassers normally lose their annexations. Thus, absent to statute, and adverse possessor or good faith trespasser cannot remove fixtures. For example, a house erroneously constructed on a parcel that possessor believed he owned. Some courts, however, allow a good faith trespasser recovery measured by the value added to the land, not construction costs.
