The last days of summer and the month of September are a time when cities are buzzing with students and house hunters. Getting your first lease or changing your home may seem like a simple formality, but this is where costly mistakes are often made. Unrecorded housing conditions, verbal agreements or ill-considered contract terms are often the cause of lengthy court disputes.
According to Karolína Briliūtė, Senior Associate at AVOCAD, the most important first step in this process is a proper inspection of the property before concluding the lease agreement.
The lawyer notes that if a dispute arises over who damaged the property, the key evidence is a record of the property’s condition prior to the signing of the lease agreement. A crucial safeguard for proving one’s case is ensured when the property’s condition is documented. “In such a case, before signing the contract, it is advisable for both the landlord and the tenant to film the premises, recording (stating) the date of the recording in the video, and to inspect the condition of the premises, specifying what damage and defects already exist prior to signing the lease agreement. “It is essential to include the recorded defects in the lease agreement and clearly address them,” advises K. Briliūtė.
Otherwise, the landlord may take the position that certain defects in the property were caused by the tenant, either during the lease or after its expiry. According to the general rules of evidence, the burden of rebutting such allegations lies with the tenant. In the absence of visual evidence, the tenant risks not being able to defend itself against the claims made against it and having to pay for the damage caused to the dwelling, even if it existed before the contract was concluded. Accordingly, the recording of the condition of the property also makes it easier for the landlord to meet the burden of proof by claiming that it was the tenant who caused the damage during the rental period and thus caused the damage for which it is liable.
An AVOCAD lawyer also highlights a second important step: drawing up a written contract. “Although the law provides that a residential lease agreement may be concluded verbally, judicial practice and the volume of disputes that arise confirm that one should not be tempted by its simplicity,” warns Karolina Briliūtė.
In the absence of a written contract as evidence and, for example, if the tenant fails to pay the rent, it is difficult for the landlord to prove that the tenant even lived on the premises, and it is also difficult to prove the true intention of the parties as to what was agreed in the lease contract (the price, the term of the lease, the liquidated damages, the penalties, the termination procedure, the termination notice periods etc.). This makes proof difficult, as the parties' explanations or the testimony of witnesses are given decisive weight, and this bureaucratic burden is particularly burdensome in court for the parties themselves. The additional hassle can be avoided by drawing up a written lease agreement and by discussing all the terms of the agreement in as much detail as possible, so as to leave no room for interpretation by the parties.
In this respect, she says, it is advisable to weigh up the potential risks and potential disputes and not be tempted to enter into a written contract in order to avoid taxes.
Lawyer Karolina Briliūtė also points out that subletting is only possible with the owner's consent. It is quite common for several tenants (students) to rent one apartment, but then one of the tenants decides to move out and "sublet" the room to another. In this case, an additional step is necessary to obtain the landlord's consent to sublet the property. If this is not done and disputes arise between the parties, the subletting contract may be invalidated. As in the case of a head lease, it is advisable to keep a record of the condition of the premises in the form of a visual record. This is to protect both the tenant and the sub-tenant in the event of any later questions as to whose fault any damage to the premises was.
You should also be aware of an additional protection for the tenant - the possibility to request a declaration that the terms of the lease are unfair.
In such a case, if the landlord is a legal entity, the tenant, as a consumer, is undoubtedly entitled to additional consumer protection—namely, the right to request that certain provisions of the lease agreement be declared invalid. “It should be noted that a natural person may also be recognized as a business operator if the rental of residential premises is a regular (frequent) activity, generates income, or if a certain portion of the funds received from the lease constitutes the lessor’s income. In such cases, the tenant is entitled to the additional protections applicable to consumers,” the lawyer emphasizes.
According to Karolina Briliūtė, unfair terms can be defined as terms that substantially unbalance the rights and obligations of the landlord and the tenant, putting the tenant in a significantly worse position than the landlord.
For this reason, it is preferable to prove the agreed circumstances where there is a written contract, rather than relying solely on oral explanations in the event of a dispute as to what was agreed between the landlord and the tenant.
In conclusion, the lawyer says that when concluding lease agreements, it is advisable not to avoid concluding them in writing, agreeing on all the terms of the agreement in as much detail as possible in order to avoid any interpretation of such provisions, recording the condition of the premises for both the landlord and the tenant prior to the conclusion of the agreement, making sure that the terms of the agreement do not distort the balance of the parties' rights and duties, and that any change of one of the tenants in the contractual relationship is only possible with the landlord's agreement.