Dissolution of lease agreement

Usually, a lease of business premises ends by notice. In special cases, however, a lease can be dissolved. In principle, termination takes place at the end of the agreed rental period. A choice is then made not to renew the contract. In contrast, a lease can be dissolved at any time. In that case there must be an attributable failure in the performance of the lease. Also called default.

Dissolve lease agreement business premises

By law, there are two different types of business space: middle-market business space (290-rent) and office space. The latter is also called ‘other business space’ or ‘230a business space. A middle market business space is a built-up property (or part thereof), which under a lease is intended for the operation of catering or retail businesses. Office space, on the other hand, is a built property (or part thereof), which is not residential or commercial. These include, for example, offices and distribution centers. It is not possible to deviate from the legal rules that apply to leases for middle-class business premises to the detriment of the tenant.

Termination of business premises lease by mutual consent

Interim termination of a lease of business premises (without court intervention) is only possible by mutual consent. A termination agreement sets the end date of the lease. The condition is that the termination agreement was concluded after the lease was entered into.

Termination of lease agreement business premises

The lease of a medium-sized business space does not end automatically. Notice of termination is required. The notice period is one year. Notice is given via bailiff's writ or registered letter. The tenant may terminate without giving reasons. If the landlord wishes to terminate, the tenant must agree within six weeks. If this does not happen, termination is only possible with the consent of the landlord. cantonal court. If this is after the first five years, the claim granted only in cases of poor management by the tenant or if the landlord himself urgently needs the property. After ten years, on the other hand, it is sufficient that the landlord has a reasonable interest in terminating the lease. Furthermore, less strict rules apply to the termination of the lease of an office space. The lease ends by operation of law (without notice) at the end of the agreed period. The notice period is at least one month. However, there is the possibility for tenants of office space to appeal to evacuation protection.

Dissolve lease agreement business premises

A rental agreement, like other agreements be rescinded only on the grounds of default. Any deficiency in the performance of a contract provides the right to dissolve the contract, unless the minor nature of the failure does not justify dissolution. Both parties, lessee and lessor, have the right to dissolve the lease if the other party defaults. Generally, the landlord will want to dissolve earlier than the tenant. Thus, in practice, dissolution when the tenant defaults on rent is most common. When the landlord defaults, a tenant generally chooses to demand fulfillment. In addition, unlike termination, the lease can be terminated at any time and there is no deadline for the parties to consider.

Compensation for damages when lease is terminated

With the dissolution of a lease, the dispute is not over. When a contract is dissolved, the defaulting party is obligated to pay its counterparty the damages that it suffers as a result of the dissolution. In practice, the damage suffered is usually the lost rental income or the cost of relocation. Dissolving a lease is subject to different conditions and has a variety of consequences. The rental law attorney at Lexys Lawyers can tell you more about dissolving a rental agreement and how it may play out in your situation.