A tenant signs a one-year lease agreement for an apartment. The lease includes a clause stating, 'Tenant shall not assign or sublet the premises without the prior written consent of the Landlord.' The tenant later seeks to sublet the apartment to a friend due to a temporary job relocation. The landlord refuses consent, stating they simply prefer not to have subletters. In a jurisdiction following the modern view of such clauses, what is the landlord's refusal most likely considered?
- AA valid refusal, but the tenant can still sublet if the friend is a suitable replacement.
- BJustified, as the lease does not explicitly state that consent cannot be unreasonably withheld.
- CA valid exercise of the landlord's absolute right to control tenancy.
- DA breach of the implied covenant of good faith and fair dealing, as consent cannot be unreasonably withheld.
Show answer & explanationAnswer & explanation
Correct answer: D. A breach of the implied covenant of good faith and fair dealing, as consent cannot be unreasonably withheld.
Under the modern view (adopted by a significant number of jurisdictions), even when a lease clause requires landlord consent for assignment or subletting without explicitly stating 'which consent shall not be unreasonably withheld,' courts will imply a covenant of good faith and fair dealing. This means the landlord's refusal must be based on commercially reasonable grounds, not arbitrary personal preference.
Why the other options are wrong
- A. The tenant cannot simply sublet without consent; the issue is whether the landlord's refusal is legally valid.
- B. The absence of the explicit 'not unreasonably withheld' language is precisely what the modern view addresses by implying it.
- C. The modern view limits the landlord's absolute right by implying a reasonableness standard.
Landlord's Consent to Sublet/Assign (Modern View)
In many jurisdictions, even without an express 'not unreasonably withheld' clause, courts imply a covenant of good faith and fair dealing, requiring landlords to have commercially reasonable grounds for refusing consent to assignment or subletting.
- Evolves from the traditional absolute discretion view.
- Based on the implied covenant of good faith and fair dealing.
- Refusal must be based on objective, commercially reasonable factors (e.g., financial stability, suitability of use).
Memory trick: Even if the lease is quiet, good faith still makes them try it.