TRANSFER OF LEASE : HOW TO PREVENT IT FROM BECOMING A NIGHTMARE

Article locked Published on by Me Jean-Olivier Reed

Topic(s): Legal

TRANSFER OF LEASE : HOW TO PREVENT IT FROM BECOMING A NIGHTMARE

Section 1870 of the Civil Code of Québec allows the tenant, and this at any time during the lease, to assign his lease. The assignment of the lease allows the tenant to become free of all lease obligations by "transferring" his lease to another tenant. To do this he must send a written notice to the owner of his intention, with the name and address of the candidate, AND to obtain the owner’s consent to the transfer.

Here is the first advice in this situation:
1- Take this situation seriously.
2. Immediately notify the tenant that everything must be done in writing.
3- The owner has 15 days from the receipt of the notice of assignment to give an answer.
4. Respond in writing by registered mail to the tenant and advise him of your acceptance or your reasons for refusal, and this with details while respecting the confidentiality of the information received about the candidate.

It is important to also mention that, as soon as you receive notice of the assignment, it will not be possible for the owner to terminate the lease of the tenant by agreement, for instance. One shall necessarily have to consider the assignment and conduct the credit check in order to accept or reject it.

The owner’s desire to repossess the dwelling for himself at the time of transfer is not a valid reason for refusal. The only solution at this point is to get the written waiver of the applicant to the effect that he waives the housing, a task that will not be simple.

The law also states that the owner must have a serious reason to reject it.

What are these serious reasons?
Me Robin-Martial Guay (1), Director of the Régie du logement, in a judgment of June 2015, sheds light on some valid reasons which are not restrictive however:
1- Address of the candidate not supplied in the notice;
2- Income ... appears clearly insufficient to meet a monthly rent of $1,450 to which should be added energy costs;
3- Four minute-book files from various courts including an order to pay a sum of $272,784 justified the landlord to refuse it;
4-Refusal of candidates to divest their cat while the lease between the parties stipulates that animals are forbidden in the particular housing;
5. Refusal to consent to a credit check.

In this instance, he adds that:
The landlord’s refusal must be based on serious grounds. As emphasized Judge Michel Lassonde in the case Rondeau v. Guay 1 :
"The use of the term serious by the legislator lets clearly transpire the intention of the latter to restrict the leeway of the landlord."
46   It is generally considered that the motives of the landlord must be based on the genuine quality of the transferee. According to the jurisprudence consulted by the Court, the landlord’s refusal may be based on the assignee’s ability to pay, his insolvency or failure to comply with his obligations under the lease.
You should be aware that in this case the owner finally declined 3 candidates who should have been accepted in the circumstances. The director of the Régie explains that the certain, persistent and sometimes unjustified resistance from the landlady to lease assignment justifies the awarding of moral damages to tenants. "It is due to the exaggerated, inappropriate and unjustified measures and interventions that the lease transfer ... envisaged by the tenants could not be implemented."

In this case the owner was sentenced to pay $1,200.00 for her intransigence.

You should therefore be aware that, although there are several grounds for refusal, systematically blocking the transfer process may have detrimental consequences for you. In addition, your grounds for refusal must be supported by strong evidence presentable to the Régie du logement in the event of contestation by the tenant of your refusal. Take the time to document your records well.

In another vein, you should know that nothing in the law forbids the tenant to provide access to his housing to the candidate before the answer in order for him to move in as an occupant. On the other hand, he takes a risk if your answer is negative and you refuse his candidacy. He will then have to leave the dwelling and pay himself, again, the expensive relocation costs. Procedures exist at the Régie du logement to force recalcitrant candidates to leave the premises.

In another judgment of Me Claudine Novello (2) the candidate-transferee was already occupying the dwelling. Yet, the owner refused the candidate because of, among other things, the general attitude of that person who was contemptuous and mean towards the janitors and also because she refused to collaborate with the owner in matters of access to the housing. These reasons have been considered as a valid motive for refusal. You should know, moreover, that the evidence of the attitude was based on the testimony of many witnesses.

In summary, the owner must always take the notice of lease transfer seriously, because, if you do not answer after 15 days, it means that you are presumed to have accepted. Do not be swayed by rhetoric, stay the course, make the most complete credit check possible and respond in writing within the time limit.

Last fact: you cannot request the first month’s rent in advance. This is not the first month of the lease; you will then be in the middle of the lease term. On the other hand, if you are still in the renewal period (for instance, between January 1 and March 30) you can send your notice of lease modification and of rent increase to your new tenant.

1. 207012
2. 31-130323-067/31-130121-048

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