Occasionally, a tenant holding only a use right under its lease will transfer possession of its leased premises to a successor tenant without seeking permission of the landlord required under the assignment provision in the lease.
Occasionally, a tenant holding only a use right under its lease will transfer possession of its leased premises to a successor tenant without seeking permission of the landlord required under the assignment provision in the lease.Tags: Human Resources AssignmentAbsolute Truth EssayWhat Is A Good Research PaperEssays Of Bacon Of TruthEssay About NativismAssignment Writing Service Australia
Although you remain liable after an assignment, landlords will normally release any personal guarantees or bank guarantees that may have been provided by you, provided that the new tenant offers equivalent replacement guarantees.
Transfer of shares instead of assignment If your company is the tenant under your lease, there may be circumstances in which it suits you to sell the company rather than assign the lease.
However, if personal guarantees have been provided, the landlord’s consent will be required if it is intended to replace those guarantees.
, that Act sets out the procedure to be followed in relation to assignments and limits the circumstances in which your landlord can withhold consent to an assignment.
Normally, the landlord cannot unreasonably withhold consent to an assignment, provided that the proposed new tenant is of sound financial standing and is willing to provide personal guarantees and/or a bank guarantee at least equivalent to any guarantees that you may have provided to your landlord.
With an assignment, the landlord will normally require you and the new tenant to enter into a deed with the landlord under which the new tenant agrees to take over your obligations under the lease, and you acknowledge that despite the assignment, you are not released from obligations under the lease.
The tenant holding only a usufruct interest (use right) under its lease has no such right of assignment absent language in its lease or an assignment document expressly allowing assignments.
Almost always, the landlord who gives the usufruct tenant an assignment right reserves the landlord’s right to give its consent to any proposed assignment of a usufruct lease.
Even so, it is helpful to understand the law behind assignment provisions and to be aware of the most common legal issues landlords sometimes face despite those protective provisions.
The law of most states does not distinguish between usufruct leases, which confer mere use rights (usually shorter term leases) from estate-for years leases, which grant an interest in land (, a 99-year ground lease).