## Facts

- A commercial tenant leased premises in Boston under a 1974 lease containing a clause barring assignment or subletting without the landlord’s “express written consent.”
- The lease did not state that consent could not be unreasonably withheld or otherwise limit the landlord’s discretion.
- In 1983, a successor landlord acquired the property; the parties’ relationship became acrimonious.
- In 1987, the tenant agreed to sell its business, contingent on the landlord consenting to an assignment of the lease to the buyer.
- After negotiations and litigation, the landlord consented in April 1988 to an assignment to the buyer while expressly reserving rights as to future assignments.
- The buyer’s bank required an assignment of the lease as collateral and proposed an assignment giving the bank an unrestricted right to reassign without further landlord consent.
- The landlord refused to consent to the proposed bank assignment on those terms.
- The tenant sued, alleging the landlord wrongfully and unreasonably withheld consent, causing damages tied to financing and the sale.

## Issues

1. Whether, when a commercial lease requires landlord consent to assignment but is silent on standards, Massachusetts law implies a duty that consent not be unreasonably withheld.
2. Whether a landlord’s refusal to consent under such a clause can support liability for breach of lease, interference with contractual relations, or a violation of Mass. G.L. c. 93A.

## Decision

- The Supreme Judicial Court reversed the judgment for the tenant.
- The court held that where a commercial lease contains a consent-to-assign provision with no express limitation, the landlord may refuse consent for any reason as a matter of law.
- Because no contractual or legal duty of reasonableness applied, the case should not have been submitted to the jury on an “unreasonable refusal” theory.
- The reversal eliminated the jury’s damages awards for breach of lease, interference with contractual relations, and c. 93A.

## Legal Principles

- Courts will not imply a reasonableness limitation into a commercial lease’s consent-to-assignment clause when the lease grants consent authority without express restriction.
- Absent an express “not unreasonably withheld” (or similar) term, a landlord may withhold consent to assignment or subletting arbitrarily, without breaching the lease.
- Policy-based changes to regulate or restrict landlord consent rights are for the legislature, not for judicial insertion of new terms into existing contracts.
- In this setting, liability theories premised on the alleged unreasonableness of the withholding fail when the lease imposes no duty of reasonableness.

## Conclusion

The court held that a commercial landlord’s discretion to withhold consent to an assignment is unrestricted when the lease requires written consent but contains no express standard, requiring reversal of a verdict based on “unreasonable” refusal to consent.


21 Merchants Row Corp. v. Merchants Row, Inc., 412 Mass. 204, 587 N.E.2d 788 (1992)