Expert: John Smiley - 6/6/2008

Question
I have a business with 3 years left on my lease. There is a buyer who wants to buy my business. His credit is very good (which was check by landlord) but he is in his twenties and that concerned the landlord, he also doesn’t like that the buyer English is not the greatest. Can landlord stop me from selling my business based on these allegations? Please let us know.

Answer
Hi Renata,

I really can't say without looking at your lease.  However, most leases do give a landlord a number of rights around this topic.  The vast majority say that you cannot assign your lease (what you would need to do if selling your business) without the landlord's consent.  Many say that the landlord must be reasonable in considering that request.  Some say that the landlord can consider a number of subjects without being considered unreasonable, such as the person's credit and their experience in this particular business.   A few say that the landlord can simply terminate the lease rather than grant consent.

Chances are that the landlord has some input into whether you can sell your business and assign your lease.  However, you will need to look to your assignment provisions to determine exactly what that involvement is.

Hope that helps,
John Smiley