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RENOVATION AND TERMINATION IN LEASES FOR RESIDENTIAL USE

  • 14/09/2023
  • |   786 Views
What are the rules governing the renewal and termination of leases for residential use?
Let us look at them together.

PROCEDURE FOR RENEWAL (art. 2 l. 431/1998)  

The parties may choose whether or not to renew the lease.
On the first deadline, if the parties intend to renew, no notice is required: the agreement is automatically renewed under the same conditions for another 4 years.
At the second deadline, the party who intends to renew the agreement, must notify the other by registered letter (or other equivalent means, e.g. pec) at least six months before the expiry of the agreement.
The other party must, in turn, respond in the same form within 60 days of receipt of the notice.
If no agreement is reached or no response is received from the landlord, the agreement ends definitively on the natural deadline set out in the agreement.
If, on the other hand, on the second deadline neither party acts to renew or terminate the agreement, it is automatically renewed under the same conditions.  

THE LANDLORD'S REFUSAL TO RENEW (Art. 3 l. 431/1998)    

Since landlord and tenant are on two different positions, the law does not define rights and obligations symmetrically, granting special protection to the tenant.
The extension of the contract, in fact, is established in the tenant's interest.
This is referred to as 'refusal of renewal' for the landlord and 'termination' in the event that it is the tenant who wishes to terminate the contractual obligation.
The landlord's refusal to renew must be justified under penalty of nullity.
It may take place only in the cases strictly provided for by law:    

a) the lessor must use the property for residential, commercial, artisanal or professional use by his spouse, parents, children or relatives within the second degree;
b) when the landlord (also a legal person or public/private entity) intends to use the property for public, social, mutual, cooperative, charitable, cultural or religious purposes and offers the tenant another suitable property of which the landlord has full disposal;
c) when the tenant has the full availability of vacant and suitable accommodation in the same municipality;
d) when the property is part of a seriously damaged building and the tenant's stay is an obstacle to the completion of essential work;
e) when the property is part of a building that is to be completely renovated or is to be demolished/converted to make way for new construction, or if the property is on the top floor, and the owner intends to carry out elevations in accordance with the law and to carry them out requires the evacuation of the building;
f) when the tenant does not continuously occupy the property without justified reason;
g) when the landlord intends to sell the property to a third party and does not own any property for residential use other than the one he may be using as his own home.
In this case, the tenant shall be granted the right of pre-emption.  

If the reason for non-renewal is other than those indicated in Article 3, the landlord shall pay the tenant compensation of no less than 36 months of the last rent received.
The notice period in which the landlord must inform the tenant of the refusal to renew is at least (minimum) 6 months from the expiry of the lease.
Even when the refusal to renew is lawful, the tenancy may not be terminated before the first deadline so that the tenant is guaranteed to remain in the property for the first four years. Unlike the landlord, the tenant may give notice without having to specify a reason.   

TERMINATION OF THE TENANT  

Termination should not be confused with the tenant's termination: the former is based on the tenant's desire not to extend the relationship; termination, on the other hand, takes place when the tenant does not intend to continue the relationship regardless of the natural expiry of the contract due to facts also external to the parties' will.
The right of withdrawal may be provided for:  

a) from the lease agreement: "The parties may contractually allow the tenant to terminate the agreement at any time by giving notice to the landlord, by registered letter, at least six months before the date on which the termination is to take effect" (art. 4(1), l. 392/1978).  
In this case, the tenant's right of termination is the subject of a specific agreement. The expression "at any time" releases the tenant from the obligation to comply with the contractual deadline, provided that the termination is exercised at least six months before the date on which it takes effect in order to allow the landlord to reorganise.    

b) by law: this is termination for serious reasons (Article 4(2) of Law 392/1978 and Article 3(6) of Law 431/1998).  

The tenant's right of termination operates regardless of the existence of an ad hoc clause in the lease agreement.
The expression "serious reasons" means any situation that may require termination of the tenancy, for example a transfer for work reasons.  

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