LEASE AGREEMENTS: RIGHT OF WITHDRAWAL UNLAWFUL WHETHER THE TENANT HAS NOT EXERCISED THE TERMINATION RIGHT

06/09/2017

As far concerns the early termination of the lease agreement exercised by the tenant, should the serious reasons occur before the expiration of the term granted to the tenant for exercising the termination of the lease agreement at the relevant legal expiration date without the tenant having terminated the lease agreement, such behavior, according to the good faith principle, must be interpreted as a waiver of the tenant to terminate the lease agreement for serious reasons for the future. Therefore, these reasons are considered as not serious since, otherwise, it would have been more reasonable to terminate the lease agreement at the expiration date.

 

The question (submitted for the first time to the Court) was whether or not the tenant may invoke, as a reason justifying the termination pursuant to art. 27, Law 392/1978, a certain circumstance occurred in a period before the last tacit renewal of the lease agreement. The answer is negative.

The Court has confirmed its consolidated case law, according to which the serious reasons justifying the termination of the tenant from the lease agreement must be objective, and caused by events which are unpredictable and extraneous to the will of the tenant, and which are subsequent to the execution of the lease agreement. At the same time the Court has introduced a new principle according to which when the serious reasons – which are subsequent to the execution of the agreement – have occurred in a period before the expiration of the term to exercise the termination right at the legal expiration date of the agreement without the tenant having exercised such right, this behavior, according to the good faith principle, must be interpreted as a waiver of the tenant to terminate the lease agreement for serious reasons for the future. These reasons can be considered as not serious since, otherwise, it would have been more reasonable to terminate the lease agreement at the expiration date. The Court is of the opinion that, should the parties decide to tacitly renew the lease agreement, this renewal implies the mutual convenience of both parties in carrying-on in the lease agreement despite the occurred and subsequent “serious reasons” which, therefore, cannot be anymore invoked by the tenant in order to early terminate the lease agreement.