Can I assign my lease?

Under Maryland law, a landlord’s refusal to consent to a lease assignment is only deemed reasonable if it is based on objective grounds and reasonable commercial standards without regard to the subjective personal beliefs of the landlord (Maxima Corp. v. Cystic Fibrosis Foundation, 81 Md. App. 602 (1990)). In Maxima Corp., the court gave the following examples of good faith reasonable objections to a lease assignment:

• Assignee’s inability to fulfill the terms of the lease;
• Assignee’s financial instability or irresponsibility;
• Lack of suitability of the premises for the assignee’s intended use; or
• Assignee’s intended unlawful or undesirable use of the premises.

Conversely, a landlord does not have a reasonable basis for withholding consent if he remains assured of all the benefits bargained for in the lease.

In these difficult economic times tenants and landlords are frequently faced with the need to renegotiate, terminate or assign leases. Landlords and tenants are well advised to keep these rules in mind when considering a potential assignment of a lease.

For more information on this topic, please contact Mark Jensen at jensen@bowie-jensen.com.