In the Spotlight: Master Lease Boilerplates

Attorneys frequently do not pay much attention to boilerplate provisions in leases, and this is particularly true with subleases. This can lead to major problems after the sublease is executed, considering that subleases involve three parties and three documents (namely, the sublease, the master lease between the sublandlord and the landlord, and the document containing the landlord”s consent to the sublease). As a matter of law, as between the subtenant and the landlord, there is no privity of contract (although there is privity of estate). This means that there is no contractual arrangement between the subtenant and the landlord and, therefore, the subtenant must look to the sublandlord to provide (or cause the landlord to provide) utilities and other services and to exercise rights and remedies against the landlord on the subtenant”s behalf. Most landlords go out of their way to make it abundantly clear ” usually in the landlord”s consent document ” that there is no privity of contract with the subtenant.