New Lease vs Sublet

[Stephen E.]

I had a tenant move in and after four months want to move out. However she offered her brother as a tenant to move in and take over payments. The problem is that the brother was unemployed. I said we could do this if she stayed on the lease as a tenant and that we added him as a tenant also. We agreed, I let her out of the old lease and executed a new, signed lease agreement which listed both brother and sister as tenants.

The brother has since contacted me and said that he wants new paperwork showing him as the only one living there, and adds that he understands that he is subletting from his sister. My position is that we have a new lease contract that clearly states that both are tenants. I have explained that we do not lease to unemployed tenants, and that having her on the lease and jointly liable for rent was important. He is now looking for work.

I want good relations with the tenant, and things could work out, but I do not want problems in the case of nonpayment. Does he have a leg to stand on in regard to 'subletting'? My understanding was that we had executed a new, legally valid lease, that this supersedes previous arrangements, and that it is clear that both are tenants with the right to live there and with a shared obligation to pay rent. Clearly the last thing I want is to have an unemployed tenant with no income being the sole party responsible for making payments.

This is in Ontario and landlord tenant laws are hopelessly skewed to tenants here.