Sub Letting of Property

mullercorner

Hi,

As a new Landlord, I have a question with regards to the assignment and subletting of a property which I am the Landlord of.

Basically, the whole issue of assignment and subletting seems like a bit of a loophole for tenants to break a fixed term lease legally. Now I would have no problem on re-assigning or subletting the property if the tenant had a valid reason for doing so. My main question/worry here is, what if the tenant knows they can legally end the fixed term lease by providing a subtenant OR re-assignment tenant who is, less than desirable should we say?

My understanding is that the PRTB currently allows LL's to ask for references of the possible subtenants , which is fine. But what about in the event where the head-tenant is simply using any old person in order to break the terms of the lease? Can this be appealed to the PRTB? I hope this makes sense, it is not actually happening to me currently, just something which spiked my curiosity. Can you put a term in the lease which specifically states that subletting is not allowed? Or is this illegal here in Ireland?

Any word of advice is appreciated!

Mullercorner.

djimi

You have final say over who you allow the tenant to sublet/assign the lease to. The new tenant can be subject to the same criteria as the existing tenant was initially, and you are not obliged to accept whoever the tenant brings to you.

Subletting and assignment are not the same thing. You dont really have much choice in the matter when it comes to assignment (the tenant can request it and if you refuse then they can terminate the tenancy and expect to get deposit returned), but with subletting you can write it into the lease that it is forbidden and you can refuse to allow the tenant to sublet.

djimi

If you are worried about assignment and who the tenant will bring to you then you always have the option of agreeing to terminate the lease early and then looking for a new tenant yourself. Its not ideal perhaps, and you could ask the tenant for a financial contribution perhaps to cover the inconvenience, but at least that way you are in full control of who you let the property to.

sunnysoutheast

djimi wrote: »

You have final say over who you allow the tenant to sublet/assign the lease to. The new tenant can be subject to the same criteria as the existing tenant was initially, and you are not obliged to accept whoever the tenant brings to you.

Subletting and assignment are not the same thing. You dont really have much choice in the matter when it comes to assignment (the tenant can request it and if you refuse then they can terminate the tenancy and expect to get deposit returned), but with subletting you can write it into the lease that it is forbidden and you can refuse to allow the tenant to sublet.

The latter is not how Threshold see it:

"As a tenant, whilst you cannot assign or sub-let without the landlord's written consent, you may terminate the tenancy if they refuse your request. "

sunnysoutheast

mullercorner wrote: »

Hi,

Basically, the whole issue of assignment and subletting seems like a bit of a loophole for tenants to break a fixed term lease legally.

Bingo!

In my opinion as a landlord it is vital to maintain control over who is in your property, even at the cost of a void period.

mullercorner

Thanks djimi! That pretty much cleared it right up for me! Was unsure as to whether or not you could definitely write a 'no subletting' clause into the lease! I appreciate the speedy response!

djimi

sunnysoutheast wrote: »

The latter is not how Threshold see it:

"As a tenant, whilst you cannot assign or sub-let without the landlord's written consent, you may terminate the tenancy if they refuse your request. "

Ive seen that on Thresholds site before alright. Im not entirely sure that its accurate though; every lease I have seen has a no subletting clause, and its my understanding that its entirely at the discretion of landlord as to whether or not they want to allow subletting. I may have to do more research into it...

sunnysoutheast

djimi wrote: »

Ive seen that on Thresholds site before alright. Im not entirely sure that its accurate though; every lease I have seen has a no subletting clause, and its my understanding that its entirely at the discretion of landlord as to whether or not they want to allow subletting. I may have to do more research into it...

Was it no subletting, or no subletting without the landlord's permission? The latter is in the ones we use.

I'm sure somebody will be along with the relevant section of the RTA2004 in due course........!

djimi

sunnysoutheast wrote: »

Basically, the whole issue of assignment and subletting seems like a bit of a loophole for tenants to break a fixed term lease legally.

Bingo!

In my opinion as a landlord it is vital to maintain control over who is in your property, even at the cost of a void period.

Its a very deliberate loophole which allows tenants a legal way to get out of a lease if needs be (assignment is anyway). The landlord still has a fair degree of control in so far as they still have final say over who takes over the lease, and are not obliged to just to take the first person that the tenant brings to them.

djimi

sunnysoutheast wrote: »

Was it no subletting, or no subletting without the landlord's permission? The latter is in the ones we use.

I'm sure somebody will be along with the relevant section of the RTA2004 in due course........!

Seems that the landlord cannot forbid subletting:

186.—(1) This section has effect—

(a) despite the fact that the tenancy concerned is one for a fixed period, and

(b) despite anything to the contrary in the lease or tenancy agreement concerned.

(2) If a landlord of a dwelling refuses his or her consent to an assignment or sub-letting of the tenancy concerned by the tenant, the tenant may serve a notice of termination in respect of the tenancy and terminate it accordingly.

(3) The period of notice to be given by that notice of termination is—

(a) that specified in section 66 , or

(b) such lesser period of notice as may be agreed between the landlord and the tenant in accordance with section 69 ,

even if the lease or tenancy agreement provides for a greater period of notice to be given.

http://www.irishstatutebook.ie/2004/en/act/pub/0027/sec0186.html

I may have it wrong as to what the lease says; it looks more likely that it will specify no subletting without the consent of the landlord (or something to that effect).

mullercorner

djimi wrote: »

Seems that the landlord cannot forbid subletting:



http://www.irishstatutebook.ie/2004/en/act/pub/0027/sec0186.html

I may have it wrong as to what the lease says; it looks more likely that it will specify no subletting without the consent of the landlord (or something to that effect).

Hmm, yes it does state that (albeit not exactly clearly);

'(b) despite anything to the contrary in the lease or tenancy agreement'

I suppose this is interpreted as 'the lease says no, but you can still ask, and if refused, the lease can be terminated' ?

djimi

Basically, yes. The lease cannot contain anything that seeks to reduce the minimum rights afforded to the tenant in the RTA 2004. I hadnt realised that subletting was also covered in this section of the RTA, but it appears that it is.

odds_on

sunnysoutheast wrote: »

The latter is not how Threshold see it:

"As a tenant, whilst you cannot assign or sub-let without the landlord's written consent, you may terminate the tenancy if they refuse your request. "

If a landlord refuses an assignment, yes, the tenant may leave with 28 days notice and keep his deposit (unless there is damage in excess of normal wear and tear).

However, no where does it say that a landlord cannot vet an new tenant provided by the out-going tenant. In fact, a PRTB Tribunal case, TR 10/DR564/2008 states:

The landlord was within his rights to insist on references in advance of agreeing to allow a replacement tenant to reside in the dwelling

Furthermore, a tenant is liable for any costs of the landlord in an assignment.

With a sub-let arrangement, the head tenant assumes all the responsibilities and obligations of a landlord towards his tenant (including, for example, the prohibition on entering the property without mutual agreement of the tenant). The head tenant is also responsible to the landlord of the property for any damage caused by the head tenant's actions.

sunnysoutheast

odds_on wrote: »

However, no where does it say that a landlord cannot vet an new tenant provided by the out-going tenant. In fact, a PRTB Tribunal case, TR 10/DR564/2008 states:


Furthermore, a tenant is liable for any costs of the landlord in an assignment.

I've got no issue with the legality or otherwise of lease assignment, other than the practicalities of implementing it. For example, if a landlord refuses a new tenant because they believe their work reference isn't good enough (e.g. probationary period), is that grounds for the original tenant to issue a NoT?

I prefer to let the tenant leave, and if they facilitate viewings etc. for an early replacement then they will get a pro-rata refund of rent, if that works out.

Subletting introduces layered tenancies, imho best avoided.

I appreciate others might operate differently, that's up to them.

odds_on

sunnysoutheast wrote: »

I've got no issue with the legality or otherwise of lease assignment, other than the practicalities of implementing it. For example, if a landlord refuses a new tenant because they believe their work reference isn't good enough (e.g. probationary period), is that grounds for the original tenant to issue a NoT?

I prefer to let the tenant leave, and if they facilitate viewings etc. for an early replacement then they will get a pro-rata refund of rent, if that works out.

Subletting introduces layered tenancies, imho best avoided.

I appreciate others might operate differently, that's up to them.

No, it is not grounds for the tenant to serve an NoT - provided that the landlord has a genuine reason with the references.

It is your prerogative if you want to allow a tenant to break a fixed term lease without an assignment and refund him the deposit.

The essence behind an assignment is that the landlord is not out of pocket either in loss of rent or in the costs of having to find a new tenant. Therefore the law states that it is the tenant who should find the new tenant and that the out-going tenant continues to pay his rent until the in-coming tenant takes over the lease.

I agree that sub-letting can have its difficulties especially if the head tenant decides to terminate his lease - problems for the landlord and sub-tenant; not to mention the sub-tenants rights he acquires once he has been in the property for 6 months.