Sublet Profit

In last week’s article, we concluded that if the contract does not state otherwise, it is permissible to sublet an unfurnished unit, even without the owner’s permission, to a similar-sized family.

The Greens lived upstate, but were going away for the summer. They planned to sublet their rented house.

“We pay $3,500 a month,” Mr. Green said to his wife. “However, I think that people from the city would be willing to pay $5,000 to be here for the summer. It’s still way less than sending kids off to camp.”

“It doesn’t hurt to try,” replied Mrs. Green. “If we can get $5,000 – great!”

The Greens publicized that the house was available to sublet for the summer. They received several inquiries, and – after getting positive recommendations about them – sublet to the Browns, who had the same number of children, for $5,000.

The Greens notified the landlord that they would be away for the summer. “We arranged to sublet the house to the Browns,” Mr. Green said. “They’re a fine, responsible family, with the same number of children.”

“Someone mentioned that you were looking to sublet,” replied the owner. “I also heard that you were asking for $5,000 a month.”

“Yes, for the summer people are willing to pay more,” said Mr. Green.

“That you sublet to offset your rent – I understand,” said the owner. “Add $1,000 for your furniture – also fine. But why should you be able to earn the remaining $500 profit off my house? The extra $500 should come to me!”

“I don’t agree,” countered Mr. Green. “You’re getting your rent! What’s it to you if we gain?”

The two called Rabbi Dayan and asked, “Who gets the sublet profit, the tenant or the landlord?”

“Nimukei Yosef (B.K. 9a) addresses this issue,” replied Rabbi Dayan, “based on a case in the Mishna (B.M. 35b) in which a person who rented a cow lent it to a third party, and it died.”

“Although the renter is not liable for oness, such as natural death, whereas the borrower is, Rabi Yosei rules that the borrower pays the value of cow to the owner, not to the renter/lender, since he should not profit from the other person’s cow (C.M. 307:5).

“Nimukei Yosef therefore concludes that if the tenant was not allowed to sublet the house – such as if he sublet to a larger family – the profit goes to the owner, since the tenant should not profit from the owner’s house. However, if the tenant was allowed to sublet the house – either because he had explicit permission or because he sublet to a similar-sized family – the tenant keeps the profit (Rema 363:10).

“Several Acharonim explain that – unlike the cow, where the renter has no ownership rights in the cow itself, and therefore the borrower’s payment goes to the owner – the tenant owns the usage rights, so that when he sublets according to the halacha, he profits from his own usage rights, not from the landlord’s property. However, when he sublets in a manner that is not allowed, beyond his rights, the profit goes to the owner, since the tenant should not be profiting from the owner’s property (Ketzos 363:8).

“Machaneh Ephraim (Sechirus #19) further suggests that even if the tenant wrongly sublet to a larger family, the profit goes to the landlord only if he initially rented it out to the tenant at a discount. However, if the tenant initially rented the house for its full value, but succeeded in subletting for more, the tenant can keep the profit, since here there is no loss to the owner. Other Acharonim do not accept this distinction (Emek HaMishpat, Sechirus Battim 62:14-16).

“Thus,” concluded Rabbi Dayan, “since the Greens rightfully sublet to a similar-sized family, they can keep the profit.”

Verdict: If the tenant sublet for a profit, provided that he sublet in a permitted manner, he can keep the profit; if he sublet in an unauthorized manner, the profit goes to the owner.

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This article is intended for learning purposes and cannot be used for final halachic decision. There are also issues of dina d’malchusa to consider in actual cases.

To regenerate means to restore, renew, or revive something that has been damaged or lost. It can refer to physical, mental, emotional, or spiritual renewal and healing. It is the process of bringing something back to life or making it whole again.

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