Precedential Court decision in a dispute between the parties to a lease agreement for premises in a shopping centre concerning withdrawal from the agreement in connection with the coronavirus pandemic

Precedential Court decision in a dispute between the parties to a lease agreement for premises in a shopping centre concerning withdrawal from the agreement in connection with the coronavirus pandemic

In a petition lodged with the Regional Court on behalf of the Client, the lessee of a unit in a shopping centre, the Law Firm demanded that a security be provided for the claim for determining the non-existence of the contractual penalty imposed by the lessor in the amount of several hundred thousand zlotys.

The parties were bound by a lease agreement concluded for a fixed period. In order to secure the lessor’s claims for the payment of the resulting receivables, the lessee submitted a statement of submission to enforcement pursuant to Article 777.1.5 of the Code of Civil Procedure in the form of a notarial deed. Due to the ban on operating in shopping malls introduced in March 2020, the lessee entered into discussions with the lessor concerning the reduction of fees resulting from the agreement, to which the lessor did not agree. The lessee withdrew from the agreement, citing the inability to achieve its objective assumed by the parties on the date of its conclusion due to the SARS-CoV-2 pandemic and the bans and numerous restrictions introduced in connection with it. The lessor considered the lessee’s statement to be ineffective, at the same time terminating the agreement with immediate effect due to a breach of the obligation to conduct commercial activity at the unit. At the same time, he imposed a contractual penalty of several hundred thousand zlotys on the lessee.

In the above circumstances, for fear of the lessor using the security of claims granted in the form of a notarial deed, on the basis of which he could enforce the contractual penalty without conducting proceedings to assess the legitimacy of the claim, the lessee decided to apply to the Court for an injunction. The Regional Court shared the opinion presented by the Client, represented by Agnieszka Skibińska-Lipowicz, attorney-at-law, preventing the lessor from conducting the enforcement proceedings based on the notarial deed in question.

This is a precedent. The SARS-CoV-2 virus pandemic and the measures taken by the authorities during this period have had a huge impact on obligations, including, in particular, those of a permanent nature, such as rent. On more than one occasion, lessees have been obliged to perform contracts as they have done so far, without taking into account the current economic situation. In the absence of the lessor’s willingness to renegotiate the terms of agreements, the lessees found themselves in a stalemate. In the event of a breach of contractual obligations, the lessors could easily use the security provided to them, satisfying their claims without the courts assessing their legitimacy. Lessees can oppose them by initiating lengthy court proceedings, which – in the light of the uncertain economic situation associated with the pandemic – may ultimately result in a failure to recover the amounts enforced. The measure which may prove to be an effective solution to this problem is precisely the fact that the courts are generally reluctant to secure lessees’ claims.

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