Sub-tenant's rights?

Question from Cooper updated on 14th May 2013:

I am a landlord and I have signed a tenancy with a tenant who has sublet to another person. My tenant has given notice to me to terminate and I have accepted.  Does the sub-tenant have rights to continue the sub-tenancy agreement after the master tenant has left?

Our expert Alan Bruce responded:

A sublet arrangement occurs where a tenant passes possession of the premises to a third party. It does not usually include an arrangement where the tenant continues to live in the premises, or where the tenant shares part of their dwelling with their sub-tenant. This type of arrangement may be considered to be a flat-share arrangement, and not covered under the Residential Tenancies Act 1986 (the Act). For tenancies (and sub-tenancies) that do fall under the jurisdiction of the Act, in most cases landlords (including sub-landlords) are required to give a minimum of 90 days’ notice to terminate a periodic tenancy (or 28 days’ in the case of a boarding house tenancy). Fixed-term tenancies cannot be ended by notice, but may be ended by mutual consent or by the Tenancy Tribunal in limited circumstances. However, the Act specifies that where premises are subject to a tenancy and one or more subtenancies, where a landlord terminates a head tenancy by providing notice of termination, notice of termination must also be provided to the sub-tenant. While this may also apply in cases where a tenant gives notice to the landlord to terminate the main tenancy (with the tenant required to provide vacant possession of the premises back to the landlord at the end of the tenancy), parties should bear in mind that sub-tenants are also entitled to the correct amount of notice from their landlord (including the sub-landlord) to terminate a periodic tenancy. It is recommended that you discuss the matter with your tenant to determine whether the appropriate notice has been given to end their sub-tenancy, noting that the sub-tenant(s) may seek recourse through the Tenancy Tribunal if they have not received the appropriate notice to terminate their tenancy. Alternatively, landlords that are happy for sub-tenants to remain, can arrange to take over as the landlord for that tenancy, including completing a Change of Landlord form to amend the details on the bond record. A Change of Landlord form can be downloaded from the Ministry of Business, Innovation and Employment – Building and Housing Group’s website (http://www.dbh.govt.nz/UserFiles/File/Publications/Tenancy/pdf/change-of-landlord-agent-form.pdf). To discuss your (or your tenant’s) situation further, or for information regarding sub-tenancies, you can visit the Ministry of Business, Innovation and Employment, Building and Housing Group’s website (www.dbh.govt.nz), or call 0800 TENANCY (0800 836 262).

The Ministry of Business, Innovation and Employment provides information and guidance on building law and compliance, services including weathertight homes, and advice for tenants and landlords.

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