THE PAYMENT OF THE RENTAL OF THE BUSINESS PREMISES DURING THE STATE OF ALARM
The declaration of the state of alarm decreed in Spain by Royal Decree 463/2020, of March 14, has paralyzed the economic activity of many companies that are tenants of premises since the aforementioned legal measure has as a direct and immediate consequence the imposition of the closure of commercial establishments.
Despite the avalanche of regulations published in recent weeks, no action measures have been regulated in this regard. In fact, there is no legislation in force that protects the parties at the moment either.
Given this lack of regulation, the role of the lawyer negotiating between the parties is essential. They are free to reach the covenants they consider. For example, rent reductions while the alarm status lasts or payment installments. There are also major real estate companies that have agreed to suspend the rent until the state of alarm is lifted.
It is important to note that during the negotiation or if an agreement is not reached and you have to go to court, the lessee could claim a jurisdictional creation clause: the rebus sic stantibus. This clause seeks to fill the imbalance of the lessee - who cannot dispose of the premises and cannot generate income - for the contract to survive. Budgets that meet in the situation caused by the Covid-19 must concur for its application:
- It is an extraordinary and unpredictable risk
- It is not a fact attributable to any of the parties, but it is the State that has decreed the closure of commercial establishments.
- The economic activity that the lessee was exercising has been suspended, which generates an imbalance in the obligations of the parties.
For these reasons, it is recommended to reach an agreement between the parties. IURIS GRUP has extensive experience in negotiating leases and at the moment, during the state of alarm, we have reached a large number of agreements.
We are at your entire disposal in the event that you are in the situation described.