Court of Appeals Rules Tenant Owes Six Months' Rent for Early Exit
The Court of Appeals upheld a six-month notice clause, ordering a tenant to pay 140,630 USD in compensation for vacating a logistics warehouse without notice.
KEY POINTS
- Tenant vacated a leased logistics warehouse in January 2016 without giving the contractually required six-month notice.
- Lower courts awarded one month's rent (140,630 USD) based on a contract clause defining 'reasonable period' as one month.
- Court of Appeals 3rd Civil Chamber ruled the six-month notice clause itself defines the reasonable period.
- Tenant is liable for six months' rent as compensation for early termination without notice.
- Case remanded to lower court for recalculation of damages.
A property owner leased a logistics warehouse for five years starting July 2011 under a contract allowing termination with six months' notice. In January 2016, the tenant vacated the premises without informing the landlord, who then sued for lost rent.
The first-instance court awarded one month's rent, 140,630 USD, citing the time needed to re-let the property. The Regional Court of Justice upheld this, noting the contract defined a 'reasonable period' as one month.
“The contractual six-month notice period constitutes the reasonable period required by law.”
The Court of Appeals' 3rd Civil Chamber overturned the lower courts. It ruled that the contractual six-month notice period constituted the reasonable notice required by law, not the one-month term set by the parties.
Because the tenant left without giving the agreed six-month notice, the landlord was entitled to six months of rent as compensation. The case was remanded for a new ruling in line with this precedent.
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