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William D. Randall's Blog (of no particular interest to no one in particular)
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Thursday, November 09, 2006
FINALS BLOGGING SERIES After Action Report - My response below was a good start. It could use a little more development in regards to the common law view and the minority intent view and discussing the factors of categorization, rent, and repossession. And while I briefly skimmed the privity issues (Contract and Estates), my professor is a stickler for details this will not fly for the final. For the final tally Spotting Issues - 8 Rule Statements - 4 (Lacking sufficient detail to allow for a proper analysis) Analysis - 4 (Needs more meat on the bones) Ok, here is the deal. It's about T-4 weeks and counting until my first Final (Con Law I - Dec 4th), and I've yet to do actual practice exams. I've practiced multiple choice questions, at least, but the money is in the essays. So, for the next few weeks, and throughout reading period I'm going to write one blog post exam answer per class (or more) in order to give me an incentive to write. I might write a paragraph, I might just do a quick and dirty outline, or I may just play the good old "spot the issues" game but what I write here is for my own personal musings and is not to serve as legal advice. Besides, while the general rules are pretty much the same in most jurisdictions, I quote my CivPro professor when he states, "check your local listings." Now for Landlord Tenant: Assignment and Delegation Basic Fact pattern: L --> T on a Tenancy for Years, leasehold estate - $800 Rent per month. Six months in, T --> A on same lease, $900 rent per month, payable to T. T skips and fails to pay L rent. L seeks back rent from A. A refuses to pay and wants to move out. L believes that A is bound by the agreement and must pay rent or damages. What are A's Options? Is there an expressed provision in the lease between the leasor and the leasee forbidding the creation of subleases or assignments? Unless otherwise stated in the lease agreement, leasees have the right to sublease or assign their interest to others. Here, there is no indication that L restricted the ability of T to create a sublease or an assignment with A. Assuming for purposes of analysis only, it can be said that L did not intend to limit T's ability to create an assignment or sublease with another person. Does the categorization of the lease between T and A constitute a sublease or an assignment? In order to determine A's responsibilities to L, we must first determine whether T and A intended to create a sublease with A or whether A was given an assignment to the premises. Under the common law, an assignment is present when the tenant transfers his estate to another party for the remainder of the lease term, anything less, and the tenant is viewed as creating a sublease. Modernly, the intent of the parties governs in determining whether there is a sublease or an assignment. This distinction is crucial because under a sublease, only the tenant has privity of estate and privity of contract with the leasor. The subleasee is not responsible for the subleasors obligations to the original leasor, as this relationship is similar to a landlord-tenant relationship. In this instance, the subleasee would not be responsible directly to the lessor. Whereas in an assignment, the assignee is viewed as being in privity with the lessor and assumes all obligations possessed by the original tenant. Here, while A will argue that the language indicates T and A had the intent to create a sublease between them, three factors indicate otherwise. First, the agreement between A and T indicated that A was to have possession of the apartment for the remainder of the term. T had transferred the remainder of his estate to A for the remaining term, making this factor highly indicative of the creation of an assignment. Second, A agreed to pay T in excess of the rent on the apartment. In Abernathy the Arkansas supreme court indicated that rent paid by the subleasee to the subleasor that is equal to the rent paid by the subleasor to the leasor, is indicative of an assignment. Rent paid in excess would likely be held to encompass this concept. Finally, T's abandonment of the premises and inability to be reached, likely indicate that T did not intend to retain a reversion to the apartment currently possessed by A. While the language between the parties indicate the intent to form a sublease, under the common law view, all aspects point to the creation of a full assignment between T and A. Under an Assignment, what responsibilities does A have to T in paying backrent? Under an assignment, the subleasee is viewed as being in direct privity with the leasor, and assumes all obligations that the leasor had under the lease. Under this concept, A would be held responsible for the back rent owned to L. Nevertheless, A may be able to avoid further liability to L by locating another assignee prior to leaving the premises. As the court held in Juilliard The liability of such assignee is terminated by a new assignment of the lease made by the assignee. Under this holding, all of the responsibilities assumed by A in the creation of the original assignment will be terminated upon the creation of the new assignment, thus absolving A of her obligations to pay any further rent to L on the remaining months of the lease. A may also be able to assert that the original agreement was entered into fraudulently to deceive A, however this theory may not carry a lot of weight. -------------------------------------------------- -Well it's not pretty. I'll update this after class with what was missed and the class consensus on A's recourse with L. Personally, I think she is out of luck, but if the intent theory were to control, a sublease can have all the trappings of an assignment yet the subleasee is able to escape all liability. I however subscribe to the Donald Duck Theory, "If it walks like a duck and talks like a duck, then its a duck." So if it looks like an assignment, smells like an assignment, its an assignment. Pure and simple.
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