Required reading for lawyers: three legal practical issues involved in the lessee's early termination of the house lease contract

In order to correctly hear disputes over urban housing lease contracts and protect the legitimate rights and interests of the parties according to law, according to the Civil Code of People's Republic of China (PRC) and other laws, combined with civil trial practice, on February 29th, 2020, the Supreme People's Court issued the Interpretation of the Supreme People's Court on Several Issues Concerning the Specific Application of Laws in Hearing Disputes over Urban Housing Lease Contracts (hereinafter referred to as the Interpretation), which extended the application scope of the Interpretation to housing lease contracts. The purpose of this paper is to discuss three legal issues involved in the lessee's early termination of the house lease contract.

0 1 Does the lessee have the right to terminate the house lease contract in advance if he voluntarily assumes the liability for breach of contract?

According to Article 5 of the Beijing Higher People's Court's Answers to Some Difficult Problems in the Trial of Disputes over House Lease Contracts, the lessee refuses to take over the house during the performance period of the lease contract, or unilaterally moves out of the leased house and informs the lessor to take back the house, which belongs to his own behavior of refusing to perform the lease contract. His refusal to take over or move out of the house does not meet the conditions for dissolution stipulated in the contract law and does not have the effect of unilaterally dissolving the contract. The lessor has the right to dissolve the contract accordingly, unless otherwise agreed in the contract. According to the court's explanation, if the lessor refuses to terminate the lease contract, considering that the lessee is unwilling to continue to perform the lease contract, the nature of the debt is not suitable for compulsory performance, and the purpose of the lease contract can no longer be realized, the court can directly decide to terminate the lease contract, and reasonably determine the specific time of contract termination according to the specific circumstances of the case, such as the time when the lessor takes back the house, the time when the parties file a lawsuit or the effective date of the judgment. If the lessee refuses to perform the lease contract and causes losses to the lessor, it shall be liable for breach of contract to compensate for the losses. As the observant party, the lessor also has the obligation to reduce the loss. The specific amount of loss is determined by the court according to the remaining lease term of the contract, whether the leased house is easy to be leased again, the difference between the lessor and other factors, the fault degree of the lessee and other factors. The rent agreed in a general contract is three to six months.

Judicial case: 202 1 1 1 Qingdao Intermediate People's Court of Shandong Province issued the third of the top ten typical cases in handling disputes over housing lease contracts;

Brief introduction of the case

As a lessee, Zhang signed a house lease contract with a real estate agency of the lessor. The contract stipulated that the lessee should notify the lessor in writing 30 days in advance if he withdraws the lease in advance, and pay a penalty of 200% of the monthly rent after settling all the expenses. During the lease period, Zhang wanted to terminate the contract and proposed it to the company staff through WeChat. However, because the two sides failed to reach an agreement on the payment of liquidated damages, Zhang moved out of the rental house directly on June 27, 2020, without going through the handover procedures and returning the keys.

Referee result

Later, Zhang sued for confirmation that the lease contract was terminated when he moved out of the house, and demanded to return several thousand yuan. After trial, the courts of first and second instance held that the reasons for their appeal were not established.

Judge's comments

If the lessee terminates the lease contract in advance without justifiable reasons and moves out of the leased house, it constitutes a breach of contract and shall bear corresponding liabilities for breach of contract. At the same time, the lessee has the obligation to properly handle the handover procedures with the lessor in time and return the leased house to the lessor in time, especially to avoid unnecessary losses caused by the vacant leased house. Under normal circumstances, if the lessee moves out of the leased premises in advance, the actual termination time of the lease contract shall be the date when the lessee properly hands over the leased premises to the lessor. For the lessor, if the lessee has actually moved out of the leased house in advance and asked the lessor to take over the house, the lessor has the right to investigate the lessee's liability for breach of contract or demand the lessee to compensate the corresponding losses according to the contract or legal provisions. In view of the characteristics of the housing lease contract, it is generally inappropriate to force the lessee to continue to perform the lease contract. Therefore, in order to prevent the deadlock of the contract and the expansion of the vacant loss of the house, the lessor should also cooperate with the lessee to hand over the house in time, otherwise, the lessor will face the responsibility of expanding the vacant loss of the house if it refuses to cooperate or deliberately delays the collection of the house. In order to reduce the occurrence of such disputes, both parties should uphold the principle of good faith and perform their respective rights and obligations in accordance with laws and regulations.

The dissolution of a contract includes legal dissolution, agreed dissolution and agreement dissolution. According to the relevant provisions of Article 24 of the Supreme People's Court's Interpretation on Several Issues Concerning the Application of People's Republic of China (PRC) Contract Law (II), only the parties who have the legal or agreed right to terminate the contract can terminate the contract by notice. Even if the lessee voluntarily assumes the liability for breach of contract, he still has no right to unilaterally terminate the house lease contract. If the lessee claims that the liquidated damages are too high and the lessor can't prove the actual loss, it may request the court to reduce the liquidated damages as appropriate in combination with the unpaid rent, the actual performance of the contract and the degree of the lessor's fault.

Where the lessee unilaterally terminates the house lease contract, the time of termination of the contract shall be based on the time when the lessee proposes to unilaterally terminate the contract or notify the lessor of handover, or on the time when the lessor explicitly accepts the withdrawal of the lease or when both parties actually handle the house handover procedures?

The lessee unilaterally notifies the lessor to terminate the contract and unilaterally withdraws from the house, which is not a condition for unilaterally terminating the contract stipulated by law or contract, and the time when the notice is delivered cannot be regarded as the time when the contract is terminated. According to the current court ruling rules, the time to terminate the contract is generally the time when the other party agrees to terminate the contract, the time when the house is vacated and handed over to the other party, or the time when the other party rents the house to a third party, or the date of prosecution.

Judicial cases:

1, (202 1) No.5140 of Jing 03 Min Zhong.

The court held that after the Far East Shun Tak Company filed a lawsuit in our hospital, Lucky Time Company clearly filed a counterclaim on September 23, 2020, requesting to dissolve the house lease contract according to law, so the counterclaim time should be the dissolution time of the house lease contract.

2.(2022) Jing 0 1 16 Early Republic of China 1852

The court held that the house lease contract signed by the original and the defendant was the true intention of both parties, and it did not violate the mandatory provisions of laws and regulations and should be valid. After the contract is signed, both parties shall perform their respective obligations according to the contract. As for the part about the termination of the contract, the plaintiff asked for the termination of the contract, and the defendant replied and agreed, and the court allowed it. However, the date of termination of the contract is March 22, 2022, when the defendant received the civil complaint.

3.(2022) JJ 0 1 Minzhong No.2328.

The court held that Shijingshan Sub-branch of Agricultural Bank of China informed Bole Technology Company in writing on June 20, 2020 to terminate the lease contract in advance on June 25, 2020; Thereafter, by June 10, 2020, Shijingshan Sub-branch of Agricultural Bank of China finally dismantled all the facilities and equipment in the leased house and returned the house to Bole Technology Company through negotiation between Shijingshan Sub-branch of Agricultural Bank of China and Bole Technology Company. Shijingshan Sub-branch of Agricultural Bank of China, as the breaching party, has no right to unilaterally terminate the lease contract. However, due to the deadlock in the lease contract between the two parties and the fact that it has not been actually performed after 2020 10, our court thinks that the termination time of the lease contract between the two parties should be determined as 2020 10, and the court of first instance determines the lease contract as June 2020.

In a long-term lease contract, the lessee terminates the contract in advance. How to apply the rent-free period stipulated in the contract?

Unless otherwise agreed by both parties, the rent shall be calculated according to the time when the lessee actually occupies the house.

Judicial precedent: (2022) Lu 02 Min Zhong No.3809

The court held that the establishment of rent-free period is usually in a long-term lease contract, in which the lessor transfers the internal sublease benefits during the renovation period to the lessee. In the case that the lessee terminates the contract in advance, it is obviously unfair if the rent-free period is still implemented according to the original contract. The lease contract of this case was signed on June, 2065 1 1 day, and the agreed lease term was 10 year. Both parties have agreed that the lease period will be rent-free until June, 20 19, 1 1, so the lease contract is terminated in case of early termination.

04 conclusion

Housing lease contract dispute is a common contract dispute in judicial practice, but its legal status is different in practice, and it is often intertwined with various issues such as demolition, epidemic situation and housing sale. From the perspective of the lessee's early termination of the house lease contract, this paper summarizes three common problems in legal practice and extracts relevant judicial practice views for everyone to learn from each other.