Permission from the landlord to assign the lease to another tenant

This is referred to as a licence to assign. Licence being the permission and assignment being the legal transfer of obligations.

In a typical lease the standard terminology states that the tenant cannot assign the lease without the landlord’s consent and such consent shall not be unreasonably withheld or delayed.

In practice what does this mean and what happens if the landlord does not give permission?

When faced with such a situation landlord’s net to make an assessment of the proposed incoming tenant and therefore require references usually from a bank, accountant or trade supplier.

Once obtained and assuming they are satisfactory, then a rent deposit is also usually required which can be anything from 2-6 months’ rent and this is recorded in a rent deposit deed.

If the landlord refuses to consent to an assignment you need to ascertain why and work with the landlord to provide comfort and alleviate his concerns. If this is not possible and the landlord is acting unreasonably, then the tenant can apply to the court for a declaration that the landlord is unreasonably withholding consent.

This can be a costly procedure so it is always advisable to negotiate and work with the landlord to obtain consent without the need for the court order.

Also remember once you have assigned the lease to another tenant, your liability under the lease is likely to continue for the remainder of the term until the tenant passes on the lease to another tenant or until the expiry of the term.

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