Court Passes Landmark Judgement On Rent Reduction

In a landmark ruling that could have wide implications, the Court of Appeals considering rents of idle nurseries, reduced the monthly rents of these leased properties by three-quarters.

Tenants of nurseries, who had not been paying their monthly rents and had also refused to vacate their leased government properties, had appealed to the court to find a solution to their predicament.

 

In their petition, the nursery tenants had cited that curfews, lockdowns and other measures introduced by the government to prevent the spread of coronavirus infection, had prevented their normal business operations. They claimed that under such circumstances, it was illogical for the government to claim rents for the period when they had also not permitted business operations.

The new ruling on Wednesday has now set a precedent and opens the door for owners of various other businesses affected by the government-imposed closure to claim similar relief from the courts.

Owners of businesses can now claim a reduction in their rents from property owners, citing the court ruling that the shut-down of business by the government was an unprecedented ‘force majeure’. Lawyers and legal experts have stated that business owners whose operations were affected by the shutdown can file lawsuits to obtain rulings to reduce the rents of their rented properties during the period that it was not used due to restrictions imposed by the government.

A specialist in constitutional, administrative and financial law, Dr. Faisal Al-Haidar, said that the ruling by the Court of Appeal on Wednesday, “struck at the heart of the issue and brought relief from the exploitation by landlords”. He added that “the court has been fair to the nursery owners who had a lease contract, and the question that imposes itself is whether the tenant benefited from the rented nursery while the country was facing a pandemic that affected the whole world and caused the paralysis of most activities, including nurseries”.

Al-Haidar noted that here “the Court of Appeals relied on the theory of emergency conditions, stressing that it was not foreseen when planning the business that this virus will spread, and it has become impossible for the tenant to pay the rent to the landlord every month while he does not benefit from the leased property”.

He continued, “The Council of Ministers issued a clear decision banning many activities, including nurseries, so how can the landlord, in this case the government, require the tenant to pay an amount of KD 2,400 per month?”

Al-Haidar indicated that “the Court of Appeals had looked with insight after examining all the defenses and the ruling to reduce the rent is the pinnacle of justice.” He concluded by saying, “I urge everyone who has suffered material damage (due to a refusal to waive his rent payment) to resort to the court to demand a reduction in the value of the rent, as the COVID-19 crisis was beyond the possibility of expectation and the extent of its end is not known yet.”

 

SOURCE  TIMESKUWAIT

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