<p>Il diritto della crisi e dell'insolvenza</p>
Diritto ed Economia dell'ImpresaISSN 2499-3158
G. Giappichelli Editore

29/05/2020 - United Kingdom: early termination of the lease.

argomento: News del mese - Diritto Internazionale e Comunitario

Articoli Correlati: U.K. - lease contract - early termination

Due to the emergency linked to the spread of the coronavirus, the question arises as to whether the landlords can claim the tenant’s compliance with the lease even if the latter intend to exercise the right to early terminate the lease. The clauses that allow early termination must be interpreted in detail. Some, in fact, expressly establish that, in order to withdraw from the contract, the tenant must necessarily return the property (“give up occupation”) and resolve any sublease contracts, others, however, expressly provide for the tenant’s duty to completely release the ‘property by persons or things (“vacant possession”) so that the right of withdrawal can be validly exercised. As specified by the jurisprudence, the tenant’s right to terminate the contract must be interpreted restrictively in favor of the lessor. There is also a broad debate around the concepts of force majeure and frustration of contracts applicable in the midst of a coronavirus emergency. In England and Wales, lease agreements hardly contain a force majeure clause and equally rare is the reference to the doctrine of frustration. In order for the latter to be invoked, the event must be totally unpredictable and the consequences that derive from it must have changed the factual situation to such an extent as to make the execution of the contract impossible. It is very difficult for tenants to be able to enforce this doctrine. In the midst of a health emergency, landlords and tenants are making arrangements on how to pay the fees to be paid, on the possibility of temporarily reducing the fee due or postponing the payment dates.