Four Reasons You Can Use to Legally Refuse Tenant's Sublet Request

If a rent-stabilized tenant asks your permission to sublet an apartment, you may legally refuse that request only if you have a good reason. Owners can’t “unreasonably” say no to a sublet request, according to the state’s sublet law [Section 226-b of the New York Real Property Law]. But what’s a good—that is, “reasonable”—reason for saying no?

State law doesn’t specifically say. Instead, courts have decided the issue on a case-by-case basis. We came up with five reasons that owners have used to legally refuse a tenant’s sublet request. Although courts may differ, these four reasons are good guidelines when you consider a sublet request. We’ll also tell you how to turn down a sublet request and give you a Model Letter: What to Say When Refusing a Sublet Request.

Importance of Having a Good Reason for Your Refusal

If you unreasonably refuse a tenant’s request, the tenant can ask a court to rule that the sublet is okay. Or, more likely, the tenant will go ahead and sublet the apartment anyway. If you then sue to evict the tenant, the tenant can fight your eviction lawsuit by claiming that your denial of the sublet request was unreasonable. If the court agrees with the tenant, you’ll have wasted a lot of time and money, only to end up with the court’s okay of the sublet.

Get More Information from Tenant

The sublet law requires a tenant making a sublet request to give you some basic information (such as the name of the proposed subtenant and the length of the proposed sublet). That information by itself may not be enough for you to decide if the sublet request is reasonable. But the sublet law also lets you ask for more information about the proposed sublet. You must ask for this extra information within 10 days after the tenant makes the written sublet request. The 10 days start to run on the date the tenant mails the request—not the date you get it.

The best way to get the extra information is to ask the tenant to fill out a detailed sublet questionnaire. It should seek detailed information about the tenant and subtenant. For an example of such a questionnaire, you can refer to our Model Form: Gather Additional Sublet Information, available here.

FOUR REASONS FOR DENYING SUBLET REQUEST

Reason #1: Tenant’s Sublet Request Is Defective

The tenant’s sublet request must meet the requirements of the sublet law. If it doesn’t, the request is defective, and you can reject it. The request must:

• Be in writing;
• Be sent to you by certified mail, return receipt requested;
• State the term of the proposed sublease (that is, when it will begin and when it will end);
• State the name of the proposed subtenant;
• Give the business and permanent home addresses of the proposed subtenant;
• Explain the tenant’s reason for subletting;
• List the tenant’s address during the proposed sublet;
• Contain the written consent of any co-tenant or guarantor of the lease;
• Contain a copy of the proposed sublease acknowledged by both the tenant and the proposed subtenant as being a true copy of the sublease; and
• Contain a copy of the tenant’s lease, if available.

In one case, an owner sued to evict a rent-stabilized tenant for illegally subletting her apartment. The tenant had made an oral request to sublet so that she could care for her terminally ill sister. The owner told the tenant to put the request in writing, as required by law. But the tenant went ahead and sublet without making the formal request. The owner then discovered that the tenant had bought a condominium in Rockland County. The court ruled for the owner because the tenant never submitted a written sublet request in compliance with Real Property Law Section 226-b. The sublet was illegal, and the owner didn’t give up any rights by relying on the law [Caniglia v. Perez, December 1999].

Reason #2: Subtenant Is Unsuitable

You can usually judge a proposed subtenant’s suitability by the same standards you’d use to judge a tenant’s suitability. These include the proposed subtenant’s financial situation and the suitability of the subtenant’s proposed use of the apartment. You can ask about these items in your sublet questionnaire. For instance, if the tenant’s rent is $1,000 per month and the subtenant earns only $800 per month, the subtenant’s inability to pay the sublease rent would be a good reason for you to refuse the sublet request.

You can also ask if the subtenant has ever been evicted. Or you can do a background check, as you would for a tenant. For example, you could discover that the proposed subtenant was evicted from his last apartment for being a nuisance tenant. This would be a good reason for refusing the sublet request.

Reason #3: Tenant Plans to Charge an Illegal Amount

A tenant may not charge the subtenant an illegally high sublet rent. The rent should appear in the proposed sublease. If it’s illegally high, you can refuse to allow the sublet. What’s an illegally high sublet rent? The Rent Stabilization Code says that a sublet rent can’t exceed the rent-stabilized tenant’s legal regulated rent. There’s one exception. If the unit will be furnished with the tenant’s furniture, the tenant can tack on a 10 percent surcharge.

In one case, a tenant overcharged the subtenant by collecting nearly three times the stabilized rent. As a result, the owner succeeded in evicting the tenant for overcharging the subtenant, in violation of Rent Stabilization Code Section 2525.6(b) [30-40 Associates Corp. v. Cuervo, June 2007].

To confirm that the amount stated in the copy of the proposed sublease is the true sublet rent, you can:

Ask about rent on sublet questionnaire. You can include questions for the subtenant in the sublet questionnaire that you send to the tenant. In the subtenant’s part of the questionnaire, ask what rent the subtenant will be paying to the tenant. Compare that with the rent listed on the proposed sublease. Even though the tenant will see them, the subtenant’s answers may be useful, since the tenant may not pay close attention to them.

Verify rent with subtenant. In the sublet questionnaire, ask for the proposed subtenant’s telephone number. Then try to reach the proposed subtenant and verify the amount of the sublet rent.

Reason #4: Tenant Doesn’t Intend to Return to Apartment

In addition to the state sublet law, sublets of rent-stabilized apartments are governed by the city’s Rent Stabilization Code. Section 2525.6(a) of the code says that a rent-stabilized tenant has the right to sublet only if he’s maintaining the apartment as his primary residence and intends to return to it when the sublet ends. You can reject a sublet request when you have a good reason to believe the tenant doesn’t intend to return.

The tenant must tell you his reason for subletting in his sublet request. But it’s unrealistic to expect the tenant to come right out and tell you that he doesn’t plan to return to the apartment. You can get the information you need from the sublet questionnaire about what the tenant plans to do during the time of the sublet and when the tenant plans to return to the apartment. You can also ask the tenant to submit documents to support the truth of his answers. You can look at the tenant’s answers and the documents he submits to help you determine if the tenant intends to return.

In one case, an owner sued to evict the apartment’s rent-stabilized tenant for illegal subletting. The owner claimed that he rejected the tenant’s application to sublet because the tenant couldn’t prove he would be returning to the apartment. The tenant went ahead and sublet anyway. The court ruled for the owner. There was no dispute that the tenant had actually sublet the apartment and moved into a newly purchased condominium apartment in New Jersey. The court found that the tenant’s purchase of a residence elsewhere isn’t consistent with an intention to maintain the apartment as a primary residence and to return to it at the expiration of the sublease [Petty v. Handy, December 1997].

In another case, a court ruled that the owner was reasonable in refusing the tenant’s sublet request. The tenant didn’t show that she’d be returning to the apartment at the end of the sublease. And the owner had a good reason to believe that the tenant didn’t live in the apartment as a primary residence because the tenant admitted to illegally subletting the apartment for two years before the sublet request [Armed Realty v. Srubar, March 1993].

Send Letter Refusing Sublet Request

If you decide that you have a good reason to refuse a tenant’s sublet request, notify the tenant by letter. The sublet law says you must refuse a tenant’s sublet request in writing. If you don’t send this letter, the law presumes that you’ve agreed to the sublet. That means that you can’t object to the sublet later on.

What to say in letter. Like our Model Letter, your letter should set out the specific reasons why you’re refusing the sublet request. Where applicable, refer to the tenant’s answers to your sublet questionnaire, or whatever other form you used to request for extra information.

When to send letter. If you didn’t ask the tenant for extra information, you must send your letter within 30 days of the postmark date on the sublet request the tenant mailed to you. If you asked for extra information, you must send this letter to the tenant within 30 days of the date the tenant mailed the extra information to you.