Legal Advice for Landlords and Tenants – How to Avoid Disputes and Protect Your Interests

Relations between landlords and tenants often lead to legal disputes if they are not properly regulated from the outset. Whether you own a property you wish to let or you are a tenant looking for a home or an office, it is important to understand your rights and obligations. This article examines the key aspects of tenancies, offers practical advice on avoiding disputes and explains what to do if a dispute arises nonetheless.

Types of Lease Agreements and Their Legal Effect

Fixed-Term and Open-Ended Leases

• Fixed-term lease – concluded for a specified period (for example, one year) and terminates automatically on expiry, unless otherwise agreed.
• Open-ended lease – has no fixed end date and may be terminated by either party on notice.

Essential Terms of the Agreement

To be valid and protect both parties, a lease agreement should include

• the full details of the parties (personal identification number or company number);
• the exact address and a description of the property;
• the term of the lease;
• the amount of rent and the method of payment;
• the running costs (electricity, water, internet) and who pays them;
• the conditions for termination;
• the deposit and the conditions for its return;
• the parties' obligations regarding the upkeep of the property.

Note – a lease of real property for a term exceeding one year is registered in the Property Register (Art. 112(e) of the Property Act). If it is not registered but has a certain date (for example, with notarised signatures), a new owner of the property must respect it until the end of its term, but for no more than one year (Art. 237 of the Obligations and Contracts Act).

Main Rights and Obligations of Landlord and Tenant

The Landlord's Obligations

• To provide the property in a condition fit for living or working
• Not to obstruct the normal use of the property
• To carry out major repairs (unless otherwise agreed)
• To ensure the normal use of utilities

The Tenant's Obligations

• To pay the rent on time
• To use the property for the agreed purpose
• Not to make substantial alterations to the property without permission
• To keep the property in good condition
• Not to infringe the rights of neighbours

Note – on expiry of the lease, the tenant must return the property in the same condition in which it was received, save for normal wear and tear.

The Most Common Problems and How to Prevent Them

Late Payment or Non-Payment of Rent

Prevention

• Include a penalty clause for late payment in the agreement.
• Require a deposit covering at least one to two months' rent.

Remedy

• Send a written notice of the amount due.
• If non-payment continues, court proceedings may be brought.

Damage to the Property

Prevention

• Photographs and an inventory of the condition of the property when the agreement is signed.
• A deposit to cover any damage.

Remedy

• If the tenant refuses to make good the damage, the landlord may deduct the amount from the deposit or claim compensation through the courts.

Unlawful Eviction of the Tenant

Prevention

• The landlord has no right to change the locks or cut off utilities.
• In the event of non-payment or breach of the agreement, the court procedure must be followed.

Remedy

• If the landlord infringes the tenant's rights, the tenant may bring a claim before the court and seek compensation.

Termination of the Lease

Grounds for Termination

• Expiry of the term
• Breach of the terms of the agreement
• Mutual consent
• Court order (for example, for non-payment or unlawful conduct by either party)

Notice of Termination

• For an open-ended lease, the standard notice period is one month.
• For a fixed-term lease, the terms of the agreement must be observed.

What to Do in the Event of a Dispute

Mediation as an Alternative to Litigation

• Mediation is an effective way of resolving disputes without court costs and lengthy proceedings. It often leads to a compromise acceptable to both parties.

Court Proceedings

If the dispute cannot be resolved otherwise, the parties may seek protection in court. The most common claims are

• claims for unpaid rent;
• claims for damage caused;
• claims for the eviction of a tenant.

Clearly regulated tenancies reduce the risk of disputes. The keys to a successful relationship are a detailed agreement, strict observance of rights and obligations, and effective communication between the parties. In the event of a legal dispute, it is advisable to seek competent legal assistance to protect your interests.

If you need a lease agreement drafted or reviewed, or assistance with a dispute with a landlord or tenant, our real estate team can help.