Lawful sub-tenant protection under rent control depends on the eviction ground and is not lost by the main tenant's rent default.
A lawful sub-tenant protected by rent-control legislation is not liable to eviction merely because the main tenant is in arrears of rent, since the default is attributable to the tenant in possession under the landlord-tenant relationship and cannot automatically be imputed to the sub-tenant. The statutory protection for a lawful sub-tenant is also limited: on determination of the main tenancy, the sub-tenant becomes the direct tenant only subject to the Act and to the nature of the eviction ground. The protection is not absolute and does not defeat the landlord's rights under other statutory grounds. The appeals failed on the pleaded rent-default ground.
Issues: (i) Whether a lawful sub-tenant could be evicted merely because the main tenant was in arrears of rent and liable to eviction under the rent-control statute. (ii) Whether, on determination of the main tenant's tenancy, the lawful sub-tenant became the direct tenant of the landlord in all cases or only subject to the nature of the eviction ground.
Issue (i): Whether a lawful sub-tenant could be evicted merely because the main tenant was in arrears of rent and liable to eviction under the rent-control statute.
Analysis: The statutory scheme distinguishes between the tenant against whom the landlord's claim for arrears and eviction is founded and a lawful sub-tenant whose induction predates the relevant cut-off date. A sub-tenant protected by the statute does not incur liability merely because the main tenant has defaulted in payment of rent. The rent default is a ground directed against the tenant in possession under the tenancy relationship with the landlord, and the sub-tenant's protection cannot be defeated without statutory warrant. The inclusive definition of tenant does not convert every lawful sub-tenant into a defaulter for the landlord's claim against the main tenant.
Conclusion: The lawful sub-tenant was not liable to eviction merely on account of the main tenant's arrears of rent.
Issue (ii): Whether, on determination of the main tenant's tenancy, the lawful sub-tenant became the direct tenant of the landlord in all cases or only subject to the nature of the eviction ground.
Analysis: The protection given to a lawful sub-tenant is not absolute. The sub-tenant steps into the landlord's shoes only when the main tenant's interest is determined and only subject to the provisions of the rent-control statute. That statutory protection does not operate uniformly against every ground of eviction; it depends on the character of the ground relied upon by the landlord. Where the sub-tenancy is lawful and was created before the relevant cut-off date, the sub-tenant is saved from eviction on a ground that is personal to the main tenant, but the statute does not make the sub-tenant immune in all circumstances. The Court approved the view that Section 14 cannot be read to nullify the landlord's statutory rights under the other provisions of the Act.
Conclusion: The lawful sub-tenant became a direct tenant only subject to the Act and not in all circumstances irrespective of the ground of eviction.
Final Conclusion: The appeals failed because the lawful sub-tenant was protected from eviction on the pleaded rent-default ground, and the statutory scheme did not justify extending the main tenant's default to the sub-tenant so as to displace his protected status.
Ratio Decidendi: A lawful sub-tenant protected by the rent-control statute does not become liable for the main tenant's default in rent, and the statutory deeming of direct tenancy on determination of the main tenancy operates only subject to the Act and to the nature of the landlord's ground of eviction.
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