In CA is a lease complete after landlord and tenant signatures or does money have to be exchanged as well?

Question

A friend is moving out of his place in California. He has found someone to take over his lease and his landlord originally agreed to the tenant. The new lease was signed by the new tenant and the landlord. No money was exchanged at the time and the landlord decided to back out after he had signed the lease. My friend has since signed a new lease at another property. Is it legal for the landlord to back out after the lease has been signed or does money need to exchange hands first?

Answer 1

The signed lease (signed by both parties) is the contract. If the landlord chose not to require money at signing, it's his bad, but it doesn't invalidate the contract. If the new tenant chose not to pay or move in, the landlord could go after the new tenant to pay. Same way, if the landlord changes his mind, the new tenant can go after the landlord. Either way, the old tenant should be fine as his lease is no longer in effect.  

Answer 2

Money is not a legal requirement for a lease.

Your friend should have got something in writing stating that the landlord backed out.

Without it, your friend is on the hook for the first lease.