A recent article (1) highlighted the assignment of leases.
It encouraged tenants to assign their lease rather than give notice of their wish not to renew the lease. Therefore the tenants can choose their successor themselves.
The Association des Propriétaires du Québec (APQ) can only disagree with this initiative.
The choice of the future tenant is a right that belongs to the rental property owner. In addition to the aspect of meeting the future tenant, the landlord must ensure the peaceful enjoyment of the premises and be sure that the tenant will meet his financial obligations.
Encouraging the assignment of leases is to impede in a field of jurisdiction that does not concern the tenant who wishes to leave.
We are seeing more and more schemes to reduce the rights of rental property owners under the pretext of the current housing crisis. However, we must not take the housing crisis as a pretext to demand government changes or even, as in this case, to enact new rules.
The assignment of lease is a mechanism that exists indeed and must allow a tenant, who must leave his lease before its expiry, to use it. But not for any other reason.
Section 1870 of the Civil Code of Québec states the following: 1870. A lessee may sublease all or part of the leased property or assign the lease. In either case, he is bound to give the lessor notice of his intention and the name and address of the intended sublessee or assignee and to obtain the lessor’s consent to the sublease or assignment.
However, the Association des Propriétaires du Québec (APQ) believes that a legislative amendment must be made: i.e., concerning the Right of first refusal in the event of an assignment.
It was during the revision of the mandatory form of the lease that the APQ had requested that the right of first refusal in the event of assignment be included. This would have allowed the parties to agree that if the tenant wants to assign his lease, the landlord can decide to terminate the lease to re-lease it himself.
Going back to the article, tenants who want to participate in this scheme might regret it. Indeed, contrary to what tenants believe, a landlord can refuse a potential assignee.
The rental property owner has 15 days to make his verifications and accept or not the candidate and respond to the notice of transfer.
What will the tenant do if he cannot assign his lease when he has already signed another one?
In a recent article by Me Annie Lapointe(2), Choosing your tenant, how to do it?, Me Lapointe addresses the issue of refusal of potential tenants when renting a dwelling but also when assigning a lease and subletting.
“When a current tenant wishes to proceed with the assignment of his lease, i.e., a transfer of the lease to a new person, or a sublease, additional elements must be taken into consideration. The law provides that a candidate can be refused when your tenant sends you a notice of assignment or sublease with the name and contact information of a person he suggests to you, but the reason for refusal must in this case be serious. The ground for refusal is not necessarily the same in the case of an assignment as it is in the case of a sublease.”
Finally, we encourage you to read, or re-read, the article by Me Jean-Olivier Reed entitled “Assignment of the lease: How to avoid being trapped”(3).
It is also important to mention that as soon as you receive the notice of assignment, it will no longer be possible for the owner to terminate the tenant’s lease by agreement for instance. It will be mandatory to consider the transfer and carry out the verifications (investigation) in order to accept or refuse it.
(1) https://journalmetro.com/inspiration/habitation-et-immobilier/2800283/ceder-bail-augmentation-loyer/
(2) https://leproprietaire.apq.org/fr/fevrier2022/juridique/10958/Choisir-son-locataire-comment-faire-.htm
(3) https://leproprietaire.apq.org/fr/aout2021/juridique/10794/Cession-de-bail%C2%A0-Comment-%C3%A9viter-de-se-faire-pi%C3%A9ger-.htm
Assignment of lease or how to circumvent the law?
