Lease Hadn’t Terminated Automatically When Tenant Assigned It Without Owner’s Consent

A lease required the tenant to get the owner’s written consent to any assignment. If the tenant violated this requirement, the owner could either give the tenant a chance to cure the default or terminate the lease. When the tenant notified the owner that it was exercising its renewal option, the owner objected and said the lease had terminated automatically when the tenant assigned it without the owner’s written consent. So the tenant sued the owner for violating the lease by refusing to honor his option.

A California appeals court ruled that the lease hadn’t terminated automatically when the tenant assigned it without the owner’s written consent. The court said that, even assuming the tenant had assigned the lease without the owner’s written consent, the lease didn’t provide for its automatic termination. Instead, the owner had two options—both of which required the owner to take affirmative action, which it had failed to do. Therefore the lease was still in effect, and the tenant could exercise its renewal option, the court said [Page v. Hunt].