The tenant who enjoys the first sample use clause is much more likely to be able to find a subtenant or assignee than is the tenant who must labor under the second clause, regardless of the tenant’s assignment or subleasing rights. The same considerations that are discussed in the preceding sections regarding the landlord’s right to withhold its consent to a proposed transfer of the lease apply to the landlord’s right to withhold its consent to a proposed change in a tenant’s (or its transferee’s) use of the space. Thus, the tenant may ask the landlord to agree not to unreasonably withhold its consent to a change in use. Both landlord and tenant should think twice about the use clause and how this could impact a tenant’s ability to transfer the space.
1.9.Waiver. If a tenant assigns or subleases in violation of the lease restrictions, subsequent actions by the landlord may eliminate landlord’s ability to object to the assignment or sublease. In particular, when a landlord is aware of an assignment and accepts rent from the assignee, the landlord waives its right to object to the assignment. Field v. Copping, Agnew & Scales, 65 Wash. 359, 118 P. 329 (1911).
2.What Space is the Sublease/Assignment Clause referring to? -“In Whole or in Part”
Covenants limiting a tenant’s right to assign or sublet its lease are disfavored in the law and are strictly construed because they constitute restraints on the alienation of real property interests. Burns. v. Dufresne, 67 Wash. 158, 121 P. 46 (1912); Burleson v. Blankenship, 193 Wash. 547, 549, 76 P.2d 614 (1938) (stating that provisions against assignment are to be “strictly – even literally – construed”).
The landlord should be sure that the clause allowing the tenant limited rights to sublet or assign includes the language “in whole or in part.” For example:
Tenant shall not sublet or assign this Lease, in whole or in part, without Landlord’s prior consent, which shall not be unreasonably withheld, conditioned or delayed.
If this language is absent, a court may strictly construe the limitations on tenant’s right to sublet or assign, and find that it only refers to a transfer of the , and that the tenant’s right to transfer a smaller part of the entire space is not governed by the clause (remember: the default rule allows the tenant to freely assign). Cuschner v. Westlake, 43 Wash. 690, 86 P. 948 (1906). Thus, a clause that provides a “tenant shall not sublease or assign the Premises without landlord’s prior consent” could be construed to allow the tenant to freely assign or sublet a of the leased premises.
3.Is the Landlord’s Consent to One Sublet/Assignment an Automatic Consent to any Further Sublet/Assignment?
There is some authority outside of Washington to the effect that once a landlord has approved of a sublet or assignment, the transferee has free rein to thereafter further transfer the space without any right of the Landlord to consent or object even though the original lease requires consent. The Washington Supreme Court has criticized this rule in dicta. Puget Mill Co. v. Kerry, 183 Wash. 542, 49 P.2d 57 (1935). Landlords protect themselves against this risk by including language in the lease stating that their consent to one sublet or assignment is not deemed consent to any further sublet or assignment. For example: