Since 28th January 2010 private owners of houses and premises are in a position to rent them under a special type of contract – an occasional tenancy agreement which can be concluded for a specified period of time, however no longer than ten years. Such an agreement gives to a landlord a right to ask an enforcement officer to evict tenants who are troublesome or are behind with rent payment, even if the landlord has not obtained a judicial decision allowing their eviction yet.
Renting apartments in Poland?
Some time ago a lot of foreigners decided to invest in real estates in Poland intending to rent them in the future and in this way derive benefits from the assets located there. When making that decision they usually took into account different legal aspects of such an investment which could influence the amount of their future rental revenues, like for example Polish tax law (for more details re tax on rental revenues see our article on here). Quite often, however, the foreign investors did not pay sufficient attention to all legal consequences of tenancy agreements concluded by them, for which the Polish law is applicable. And those consequences, especially connected with protection of tenants, not only may be very different from what they could expect in their domestic jurisdictions, but also can sometimes cause a lot of additional expenses connected with indispensable court proceedings, let alone the landlord’s shattered nerves.
Until now in Poland most of tenancy agreements were being concluded outside state control. It was not only because of a tax regime, but also because of excessive protection of tenants, who were often unpunished and abused loopholes in the law in order to live in the apartments for free. Such an unpleasant reality is to start to change thanks to the recently introduced regulation on occasional tenancy agreements mentioned at the beginning.
Tenancy agreement in a new way
The provisions at issue are included in the act amending the law related to protection of tenants’ rights. They allow property owners to enter into occasional tenancy agreements with tenants for a specified period of time, no longer than 10 years. Occasional rent can concern only those premises which are used to meet housing needs and are not intended for short-time stay of people. Such premises can be all kinds of apartments and flats as well as single rooms and entire one-family houses. At the same time an occasional tenancy agreement will not be applicable to rents of premises intended for carrying out a business activity (office premises for example) or rooms in hotels and students’ hostels.
There is one additional reservation – new type of tenancy agreement is available only for those owners, who are not carrying out a business activity in respect to renting premises. However, it should be noted here that according to the Polish act on protection of tenants’ rights, ‘the owner’ means not only a person who has a right of ownership. This term is understood broadly and is referred both to the landlord and every other person with whom the tenant is bound by a legal relationship entitling him to use the premises (so in Poland it can also be referred to a person who has only a co-operative ownership right to a premises or co-operative residents’ right to premises).
Occasional tenancy agreement expires upon the end of the period for which it was concluded or is dissolved upon the lapse of a notice period. The good news for the owners is that in case of occasional tenancy agreement there are no limitations as to the reasons for which the landlord can terminate the contract. Possibilities of terminating traditional tenancy agreements are restricted significantly just by the closed list of the allowed reasons justifying termination on the part of the landlord (this list is included in the act on protection of tenants’ rights).
Additional paperwork
An occasional tenancy agreement has to be concluded in writing – otherwise it will be null and void. What’s more, parties to this kind of agreement have to collect some additional documents, which need to be enclosed to the agreement.
The first one is a future tenant’s statement made in the form of a notary deed where a tenant undertakes to vacate the premises and release it to the landlord within a timeframe set by the latter and where the tenant at the same time submits himself voluntarily to an enforcement proceeding in case of failure to fulfill mentioned obligations. The future tenant has to indicate in writing the other premises which can be inhabited by him, in case the landlord enforces tenant’s obligation to vacate the premises. Finally, the tenant has also to present a written statement allowing him to live on the other premises made by its owner or other person who has a legal title to it.
What the government gives it must first take away…
A legal situation of the landlord being a party to an occasional tenancy agreement is much more favourable than in case of traditional tenancy agreements, where tenants enjoy all the protection given them by the act on the protection of tenants’ rights. It is because most of the provisions included in that act do not apply to rights and obligations of parties to the occasional tenancy agreement.
If the tenant does not fulfill his obligation to vacate the premises and release it to the landlord after the expiry of the tenancy agreement, the landlord does not have to go through the full court proceedings to evict the tenant from a premises. Instead of that he will be entitled to ask the court to grant a so-called ‘enforcement clause’ to the tenant’s notarial statement in which the tenant undertook to vacate premises within a timeframe set by the landlord. On the basis of such a document the landlord will be in a position to ask the enforcement officer to evict the recalcitrant tenant from the premises.
One more facility regarding eviction has been introduced in the Polish Code of Civil Procedure. Namely, up to date an enforcement officer was obliged to suspend eviction until a given municipality indicates temporary premises for a tenant who is to be evicted if landlord’s premises has met the tenant’s housing needs and the tenant has not been granted a right to a social or alternative flat. An enforcement officer is not to be bound by that regulation, if parties concluded occasional tenancy agreement. It means that he does not have to suspend an eviction in such a case.
However… All the mentioned facilities are applicable only if the landlord notifies the revenue office of a conclusion of an occasional tenancy agreement within 14 days after the date of commencing the rental relationship. If the owner fails to do so, all recently introduced privileges will not apply to him whereas his tenant will enjoy all the protection given by the act on protection of tenants’ rights.
Anyway, occasional tenancy agreements seem to be a favourable solution for the owners, because they limit the possibilities of avoiding eviction by the tenants. As a result the owners will probably legalise their transactions gladly as they will bear in mind that – in case of troubles – they will be able to terminate the agreement and recover the property without a long-lasting court proceeding.
My cousin recommended this blog and she was totally right keep up the fantastic work!