Common Contracts

Underletting and subletting

Underletting And • July 15th, 2021

• Contract Type
  Underletting And
• Filed
  July 15th, 2021

The Nature of sub-letting and its constraints ‘Sub-letting’ (also known as ‘under-letting’) of a property generally means that a tenant further lets out the property (or part of it) to another ‘tenant’ (known as ‘sub-tenant’) by another lease/tenancy agreement (known as the ‘sub-lease’ or ‘underlease’). At law, a sub-lease executed between a tenant and sub-tenant is a separate and independent contract from the lease with the landlord (i.e. ‘head-lease’). However, notwithstanding that a tenant and a sub-tenant are generally at liberty to negotiate and agree upon the terms of a sub-lease to be different from the ‘head-lease’ (e.g. additional restrictive covenants to be imposed), the demised area and the term of a sub-lease are confined by the head lease. This is because the tenant has no right/interest to grant any interest in a sub-lease beyond the interest that he had been granted under the head-lease. For example:- “A owns Flat A and Flat B. A lets Flat A to B for a term of 1 year. Ho