My lessee asked if I'm interested in buying his leasehold interest. He wants to sell his lease to the landlord, me. He's renting my detached house in Toronto until Jun 1 2024. He pays $9 000/month. I'm discombobulated!
How does it make sense for a landlord to buy a lease from my own tenant?
If he just wants to vacate now, why didn't he just ask me to authorise him to breach and end his lease with no penalty?
Tenant's reply on May 1 2020
I phoned my tenant and asked if he "just want out of the lease early and chose very odd wording" as Hart CO suggested below. But he said no. His lawyer mom drafted his email, on point with the English law case Hughes v Metropolitan Railway (1877). He didn't understand it either. He's just following mom's instructions.
I'm not a lawyer and don't see how Hughes matters? I didn't serve notice on tenants about repairs, and when I inspected the condo in Dec 2019, it was in mint condition! I Googled and found these books discussing Hughes.
- p. 115 in 2020 book O’Sullivan & Hilliard’s The Law of Contract 9th edn. By Janet O'Sullivan.
5.78 Denning J was here referring in particular to the case of Hughes v Metropolitan Railway (1877). There, a landlord served a notice on his tenants to carry out certain repairs to the leased property within six months. (The lease provided that the tenants were responsible for repairs to the property and that the landlord was entitled to terminate (‘forfeit’) the lease if the repairs were not performed in accordance with the notice.) The tenants replied saying that they would carry out the repairs, but wondered whether the landlord might be interested in buying out their leasehold interest and suggested that the repairs might be deferred pending any negotiations. The landlord entered into negotiations and, while these were going on, the tenants deferred the repairs. After negotiations broke down, the tenants began the repairs but they were not completed within the initial six-month period, whereupon the landlord attempted to forfeit the lease. The House of Lords held that he could not do so, but was obliged to allow six months from the breaking down of negotiations.
- p. 92 in 2019 book Contract Law Directions 6th edn. By Richard Taylor, Damian Taylor.
However, in Hughes v Metropolitan Railway Company (1877), the House of Lords gave effect to conduct which amounted to a promise as to future conduct. The landowner Hughes served notice on the Railway Company to perform repairs on the property it leased from him within six months, on pain of forfeiture of the lease. The Railway Company said that it would carry out the repairs but, before it did this, it wished to hear from Hughes on its proposal for Hughes to buy the Railway Company’s leasehold interest in the property. The parties entered into negotiations but they did not arrive at an agreement and Hughes sought to eject the Railway Company from the property six months after it had served the notice of repair (the Railway Company performed the repairs two months later).