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Grounds for reduction of rent due to war

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Ланткевич Кирило
Ланткевич Кирило
Lawyer
Ukraine / Dnepropetrovsk region

i

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Publication date: 05.08.2024

I am studying in the third year of the State University of Economics and Technology.I specialize in contractual, economic and corporate law, in particular, I provide consultations and write articles.

A lease is a legal document that governs the relationship between a lessor (the person or organization that provides property for rent) and the lessee (the person or organization that uses the property for a fee). Of course, the tenant's main obligation is to pay the rent on time, in accordance with the terms of the contract. At the same time, the legislation provides for cases when the tenant has the right to demand a reduction in the amount of rent or not to pay it at all.

Grounds for reducing the rent:

In particular, in accordance with the legislation of Ukraine, the tenant can submit such a claim if:

  • Change in business conditions: If, due to circumstances for which the lessee is not responsible, the business conditions have changed, which significantly affect the use of the leased property. This can be, for example, a change in the facility's operating conditions or the introduction of new restrictions.

  • Deterioration of the condition of the rental object: If the condition of the rental object has significantly deteriorated due to reasons for which the lessee is not responsible, and this affects its normal use. For example, if the equipment used by the tenant has failed due to reasons not related to his activities.

In such cases, the tenant has the right to review the terms of the contract, including the amount of rent. Usually, the tenant must inform the landlord about these circumstances and, as a rule, submit a corresponding request for revision of the terms of the contract. The details and review procedure may be determined by the lease agreement itself, as well as by relevant legislation, for example, the Civil Code of Ukraine. It is also important that any changes are in writing and signed by both parties to be legally binding.

 

Restrictions on the use of the object as a basis for reducing the rent:

According to the civil legislation of Ukraine, in particular Article 764 of the Civil Code of Ukraine, the lessee (lessee) has the right to demand a reduction of the rent if, due to circumstances for which he is not responsible, the possibility of using the leased property has significantly decreased. Here is a detailed description of this situation:

  • Occurrence of circumstances for which the tenant is not responsible:
  1. Force majeure: For example, natural disasters, natural disasters (earthquakes, floods) or other unforeseen events that make the property unusable. The letter of the TTP of Ukraine recognized the war as one of the force majeure circumstances.
     
  2. Accidents: Damage or destruction of part or all of the property due to accidents, for example, fires, explosions, which occurred through no fault of the tenant.
     
  3. Loss of access: If access to the property has been restricted or closed due to a decision by the authorities or other circumstances beyond the tenant's control.
  • A significant reduction in the ability to use:
  1. Restrictions on use: Significant restriction or inability to use the property according to its intended purpose. For example, if the leased space for a business becomes partially or completely unsuitable for conducting business. In this case, the lessee must establish with the help of evidence not only the existence of circumstances, but also the fact of the impossibility of using the leased object due to their occurrence.
     
  2. Deterioration: If, due to external factors, the property has suffered significant damage or wear and tear that will significantly affect its use.

Exemption from rent:

The lessee (lessee) is exempted from paying for the rental of the property for the entire time during which the property could not be used due to circumstances for which he is not responsible. This rule applies if:

The circumstances affecting the use of the property were not caused by the tenant's actions or inaction.

Example of circumstances: force majeure situations (such as natural disasters), accidents, changes in legislation, or decisions of authorities that made the property unfit for use. To use this right, the tenant must notify the landlord and provide evidence of the circumstances that affected the ability to use the property.

Force majeure circumstances:

  • Exemption from liability: Force majeure circumstances exempt a party from liability for non-fulfilment or improper fulfillment of contractual obligations, if this occurred as a result of force majeure. This may include situations where the rental property becomes unfit for use due to natural disasters, accidents, or other force majeure events.
     
  • Postponement of performance of obligations: Force majeure circumstances do not exempt from the obligation itself, but only from responsibility for its improper performance during the period of force majeure. This means that an obligation (such as paying rent) must be fulfilled as soon as circumstances permit.
     
  • Obligation to perform: As soon as the force majeure ends and the ability to perform the obligation is restored, the person must perform the obligation in accordance with the contract. This may include the payment of rent for the period when the use of the property became possible.
     
  • Documentation and confirmation: In order to take advantage of the exemption from liability, it is necessary to provide documents confirming the occurrence of force majeure, and usually inform the other party about its effect on the fulfillment of obligations.

Assistance of a lawyer in the event of conflicts with a counterparty:

Here are the main types of legal services:

  • Lawyer consultation and legal analysis of the situation:

Contract analysis: A lawyer will carefully study the terms of the contract to understand the rights and obligations of each party, as well as the possible causes of the conflict.

Legal Risk Assessment: Providing an assessment of the risks and consequences for each party, including potential legal claims or penalties.

  • Legal services during negotiations and mediation:

Negotiations: A lawyer can act as a mediator in negotiations between the parties to find a compromise solution and avoid litigation.

Mediation: Conducting mediation sessions, if this is provided for in the contract or there is an opportunity for alternative dispute resolution.

  • Compilation and submission of documents:

Legal Documents: Drafting formal requests, claims, letters or other documents related to the conflict.

Court documents: Preparation and submission of pleadings, appeals or other court documents if the case goes to trial.

  • Lawyer services for representation in court:

Court proceedings: Protection of the client's interests in court, participation in hearings, presentation of evidence and arguments.

Judicial practice: Using the experience of a lawyer to effectively conduct a case in court.

  • Advice on legal strategies:

Strategy development: Developing a legal strategy to resolve the conflict, taking into account all possible options and consequences.

Alternative solutions: Recommendations for alternative ways to resolve a conflict, such as arbitration or mediation.

  • Resolution of disputed issues:

Correction of errors: Legal services in correcting errors or misunderstandings in the contract that may be the cause of the conflict.

Amendments and additions: Preparation of amendments or additions to the contract to restore mutual understanding between the parties.

Conclusion

If a conflict arises between the parties to the contract, the help of a lawyers online can be very useful. A lawyer help can provide a number of services and advice to help resolve the conflict effectively and with minimal negative consequences. A lawyer advice can greatly facilitate the process of conflict resolution, ensure the protection of rights and interests, and help achieve an optimal result within the limits of legislation.

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