68th OREGON LEGISLATIVE ASSEMBLY--1995 Regular Session

NOTE:  Matter within  { +  braces and plus signs + } in an
amended section is new. Matter within  { -  braces and minus
signs - } is existing law to be omitted. New sections are within
 { +  braces and plus signs + } .

LC 3881

                        Senate Bill 1142

Sponsored by COMMITTEE ON RULES AND ELECTIONS


                             SUMMARY

The following summary is not prepared by the sponsors of the
measure and is not a part of the body thereof subject to
consideration by the Legislative Assembly. It is an editor's
brief statement of the essential features of the measure as
introduced.

  Sets forth the law governing commercial landlord's and
commercial tenant's obligations when tenant seeks to assign or
sublease interest in commercial lease.

                        A BILL FOR AN ACT
Relating to restrictions on transfer of commercial tenancies.
Be It Enacted by the People of the State of Oregon:
  SECTION 1.  { + Section 2 of this Act is added to and made a
part of ORS chapter 91. + }
  SECTION 2.  { + (1) As used in this section:
  (a) 'Commercial landlord' includes a lessor under a lease and a
tenant who is a sublandlord under a sublease.
  (b) 'Commercial tenant' includes a subtenant or assignee.
  (c) 'Lease' means an agreement for the rental of real property,
which is not subject to ORS 90.100 to 90.940. It includes
modifications and other agreements affecting the rental agreement
and a sublease of the real property.
  (d) 'Transfer' of a tenant's interest in a lease means an
assignment, sublease or other voluntary or involuntary transfer
or encumbrance, by operation of law or otherwise, of all or part
of a tenant's interest in the lease.
  (2) Unless a lease, executed after the effective date of this
1995 Act, expressly grants a commercial landlord the sole
discretion, or uses words of similar meaning, to withhold consent
to a transfer of a commercial tenant's interest in a lease, the
commercial landlord may not unreasonably withhold, delay or
condition consent to the transfer and is subject to the duty of
good faith and fair dealing when considering whether to consent.
If a lease expressly grants a commercial landlord the sole
discretion, or uses words of similar meaning, to withhold consent
to a transfer of a commercial tenant's interest in a lease, then
the commercial landlord may arbitrarily withhold consent to a
transfer and in so doing shall not have breached any duty of good
faith and fair dealing otherwise arising under the lease with
respect to such transfer.
  (3) Whether the commercial landlord's consent has been
unreasonably withheld in a particular case is a question of fact
on which the commercial tenant has the burden of proof. The
commercial tenant may satisfy the burden of proof by showing
that, in response to the commercial tenant's written request for
a statement of reasons for withholding consent, the commercial
landlord has failed, within a reasonable time, to state to the
commercial tenant an objection to the transfer. + }
                         ----------