Gulf News February 6, 2010
07 February 2010
Gulf News: "Sub-letting Does Not Mean Rent Safety"
Q. I share an apartment with a roommate but when taking the apartment I was the one who signed the lease with the landlord. We, however, share the rent equally and have to pay four cheques. We have paid already two cheques and we are in our fifth month. In case of unforeseen circumstances, such as my roommate losing a job and deciding to leave, does the onus of paying the rest of the year’s rent fall on me?
The easiest way to look at this dilemma is to look at how many actual agreements you have – and you have two. The first agreement is a tenancy contract with your landlord which is a full, legally binding, contractual agreement. The tenancy contract defines and regulates the duties, obligations and responsibilities that each party has to the other. If one party breaks the agreement, the other party could take the matter to court.
The second agreement is an informal agreement that you have with your roommate, to share occupation of the apartment and to share the rent. However, this second agreement does not confer the same rights and obligations as the first, and may actually amount to a breach of the tenancy contract, if your landlord has prohibited sub-letting.
Allowing a third party to occupy, whilst charging that person rent, amounts to sub-letting. And landlords usually forbid sub-letting without consent for good reason – because the landlord can choose his tenant, but does not have the opportunity of choosing, or approving, a sub-tenant. Furthermore, landlords are entitled to know; who is occupying their property long-term, how many people are in permanent occupation, and what the relationship is between the tenant and the other occupiers.
The payment of rent to the landlord will always be your contractual obligation, and your personal responsibility, because your name is on the lease. In the same way, the landlord has no legal relationship with your roommate, and your roommate has no liability to the landlord for the rent. If it was intended that your roommate should share the legal responsibility to pay the contractual rent, she should have been made a party to the tenancy contract.
The ramifications of this are that if for some reason your roommate is unable to pay her rent then you would be liable to cover the outstanding sum. However, your roommate would not be able to claim a refund from the landlord if she decides to leave before the agreement is up. Whether she can obtain a refund from you depends largely on what you have agreed.
Yet, tenants are normally obliged to give a period of notice before vacating a property, and your roommate would be obtaining an unfair advantage if she expected reimbursement without allowing some element of notice to you.
Finally, if you lose your job and are unable to pay the rent yourself, you will still remain liable for the total rent – regardless of your roommate’s situation. Your landlord has the legal right to hold you to the full terms and conditions of the contract, and is not obliged to return post-dated cheques, which he can present as they fall due. If they are returned unpaid, there may be serious consequences.
Most landlords, however, recognise the difference between an inability to pay and refusal to pay, and many will agree a surrender of the tenancy contract provided the tenant provides a reasonable notice period, usually three months. It may even be possible to negotiate a shorter period. It is always advisable to ensure that you have sufficient savings to cover such contingencies, and an independent financial advisor can help you with this.
Mark Nierada, Solicitor and Senior Estate Planning Consultant with Nexus Insurance Brokers LLC