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Roger
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Category: Real Estate Law
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Experience:  BV Rated by Martindale-Hubbell; SuperLawyer rating by West
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Is rent money collected by lessor from a sub-tenant the personal

Customer Question

Is rent money collected by lessor from a sub-tenant the personal property of the lessor or personal property of the owner of the property?
Submitted: 4 years ago.
Category: Real Estate Law
Expert:  Roger replied 4 years ago.

If the lessor is actually the original tenant who has sub-let the property, it could be either depending on what agreement the lessor has with the owner.

 

Usually, the original tenant/lessor directs the sub-tenant to pay the owner directly. However, it doesn't have to be this way. The sub-tenant can pay the lessor and the lessor can turn around and pay the owner. Doing it this way just creates an unnecessary step (unless the sub-tenant is paying more rent than the lessor was).

 

It is still the lessor's ultimate responsibiliy to make sure the rent is paid, and if the sub-tenant does not pay, the lessor has to.

Customer: replied 4 years ago.

In my situation, there was a lease between the sub-tenants (multiple sub-tenants in a warehouse) and the lessor. The lessor collected the rent from the sub-tenants and made up the difference to pay the full amount of rent. Would the rent paid by the sub-tenants be considered the personal property of the lessor or the owner?

Expert:  Roger replied 4 years ago.
If they paid the lessor, it is his money. However, the lessor still has an obligation to the owner. If the lessor didn't pay the owner, both would be subject to eviction - and the lessor would be wholly obligated to pay the owner any unpaid rent.
Customer: replied 4 years ago.

If the lessor ended up not paying the rent, could the owner of the property sue under a theory of criminal theft? What is the normal cause of action to sue for unpaid rent from the original lessor?

 

Thanks for all your help.

Expert:  Roger replied 4 years ago.

No, this is a civil matter, not criminal.

 

You could sue for "breach of contract" because of the lessor's failure to pay the rent. You would be entitled to all non-paid amounts, past and future (through the end of the lease term).

Roger, Lawyer
Category: Real Estate Law
Satisfied Customers: 25999
Experience: BV Rated by Martindale-Hubbell; SuperLawyer rating by West
Roger and 7 other Real Estate Law Specialists are ready to help you
Customer: replied 4 years ago.
thanks so much, you were very helpful.
Expert:  Roger replied 4 years ago.
Great! Glad to help.

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