Owner Didn't Waive Sublet Consent Requirement

January 1, 2004

A lease required the tenant to get the owner's consent to all sublets. But the tenant sublet space to eight subtenants without getting the owner's consent. The owner discovered the subtenants and eventually sent the tenant a default notice. The tenant asked the court to determine if the owner had waived its right to require its consent to the sublets. The tenant claimed that by listing the subtenants' names on the building directory and by accepting the tenant's rent while knowing that the subtenants were occupying its space, the owner had waived the consent requirement.

A lease required the tenant to get the owner's consent to all sublets. But the tenant sublet space to eight subtenants without getting the owner's consent. The owner discovered the subtenants and eventually sent the tenant a default notice. The tenant asked the court to determine if the owner had waived its right to require its consent to the sublets. The tenant claimed that by listing the subtenants' names on the building directory and by accepting the tenant's rent while knowing that the subtenants were occupying its space, the owner had waived the consent requirement. The tenant asked the court to block the owner from terminating its lease.

A New York appeals court dismissed the tenant's case and refused to block the owner from terminating the lease. The court noted that the “clear, unambiguous” terms of the lease contradicted the tenant's claims. For instance, the lease specifically said that the listing of subtenants on the building directory wouldn't be deemed to be consent to the sublet. And the lease also specifically said that the owner's acceptance of rent with knowledge of the tenant's sublet violation wouldn't be deemed a waiver of such violation [Excel Graphics Technologies, Inc. v. CFG/AGSCB 75 Ninth Ave., LLC].

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