Rights and obligations of the parties to a commercial rental agreement for residential premises

Last modified: January 2021

Commercial rental of residential premises does not contain a specific concept, but is characterized by general features that are specified in paragraph 1 of Art. 671 Civil Code of the Russian Federation. Therefore, to fully familiarize yourself with the essence of this type of contract, we will break down its main distinctive features according to its characteristics.

Characteristic features:

urgency;
remuneration;
a wide range of persons who can act as a lessor (private owners, legal entities, municipalities, state);
Consensus.

Participants in contractual relations

This agreement differs from social rent in that the landlord of real estate can be either an individual or a legal entity, including government agencies other than the municipality. Let's consider the features of the parties to legal relations.

Landlord

A mandatory condition for the landlord when renting out residential premises is the availability of rights to own, use and dispose of the property. Sometimes the owners of commercially rented housing are members of housing funds; based on the general rule, such housing is also included in this private fund.

Based on this, it follows that persons who do not cover the share contribution are forced to pay it by renting out an apartment. The role of the party concluding the contract will not be the owner himself, but the person managing this fund (representative, manager), who will act as one of the parties to the legal relationship.

Tenant in commercial rental

Usually one individual participates in this role, but the Civil Code of the Russian Federation also allows for the condition of multiple persons participating in the transaction on the part of the lessor, not only the tenant. For example, persons who ran a joint household (cohabited) with a tenant have legal validity to enter into such a transaction with the condition of joint liability of the tenant and the persons cohabiting with him to the landlord.

In this case, the people included in the agreement acquire the status of co-tenant and similar rights and obligations as the tenant. When concluding a commercial contractual relationship, the tenant independently decides and indicates the list of citizens with whom he will live in the rented apartment, therefore it is not necessary to include even children or spouses in the number of co-tenants.

The law does not define or mention any family relationships; it indicates the presence of persons who cohabitate.

The legislation determines the existence of a documented list of citizens cohabiting with the tenant, since an excessive number of residents in a rented apartment would quickly worsen its condition. However, when a person who is not listed in the list lives in housing, he is subject to eviction or inclusion in the list with the consent of the landlord in accordance with Art. 679 Civil Code of the Russian Federation. The exception is minor children of both the tenant himself and his neighbors; they can be included in the list of co-tenants without the permission of the landlord in accordance with Part 2 of Art. 679 Civil Code of the Russian Federation.

Differences in a commercial lease agreement

Unlike an open-ended social tenancy agreement, commercial tenancy is fixed-term:
long-term – for one to five years.
The possibility of residence and use of the premises is provided not only for the tenant, but for any other persons, in contrast to social tenancy, which allows residence only to members of the tenant's family.
Payment for commercial rent is not standardized, as in social rent: it is established by agreement of the parties.
The rent for a commercial lease is more profitable for the landlord than for a regular lease, since you can immediately agree with the tenant:
the ability to change the payment amount due to changed conditions.

However, you still cannot change the rent unilaterally.

Subject of the agreement

Download the Commercial Tenancy Agreement for residential premises. Sample (76.0 KiB, 337 hits)

The object of the contractual relationship can be in the form of an apartment or its share, or a house. The size of the provided real estate is not regulated, so it is agreed upon in advance. Also, the legislation does not establish requirements for the quality of residential premises; this is again decided by the participants in legal relations; they independently decide what meets the standards for living and what does not. The legislative norms are enshrined in clause 1 of Art. 673 Civil Code of the Russian Federation. But, even based on this article, anything can become the object of hiring, the main thing is that it complies with health regulations and does not pose a threat to human life and health.

It is worth noting that the specific subject of contractual relations cannot be any utility premises. They can be used on a general basis by all residents, but if a share of the living space or house has been rented out. Also, common objects are not only utility rooms, but also property located directly in the apartment or outside it (territory of an apartment building). Such property is sanitary, technical, electrical and other equipment necessary for permanent residence.

When is the best time to enter into a commercial lease agreement?

If you have always rented out your apartment exclusively to families or students under rental agreements, and continue to do so, then you have nothing to worry about. But if you sense that the person to whom you are renting out your home is not an ordinary family man, but clearly has an entrepreneurial spirit, or a whole team of guest workers is invisibly looming behind him, then it is better to immediately draw up a commercial lease agreement.

Of course, if the tenant immediately admits to you that he intends to rent out your apartment on a daily basis, then it is easier to conclude a rental agreement, with the tenant’s right to sublease, that is, to re-rent.

Contract term

It's limited . In accordance with paragraph 1 of Art. 683 of the Civil Code of the Russian Federation, this transaction can be concluded for a period of up to 5 years . If the transaction term is not provided for in advance (not regulated), then it is automatically determined at 5 years. At the end of the contract, the tenant who previously lived in the residential premises has an advantage over other tenants, which means he can be the first to enter into a contract.

In order for the tenant to continue to live in the same housing, he must be offered a deal on the same basis. The situation is the same with a refusal to renew; in order for the GPA not to be automatically extended, you must contact the landlord about this 3 months before the end of the contract.

If the landlord refused to extend the rental period due to the fact that he changed his mind about renting out the apartment for commercial rent, but it was revealed that the housing was provided to a new tenant, and less than a year has passed since the refusal, then the former tenant has the right to legally demand recognition of the transaction imaginary (invalid) and demand compensation for losses incurred due to this decision. Also, when filing a claim in court, he can also request the renewal of the previous contract.

Co-tenants in commercial hiring

A commercial tenant can be any civilian or group of individuals (for example, a group of migrants without a “tenant” decided to rent an apartment).
If an agreement is concluded by a group of persons, then they all share both rights and obligations on the basis of joint liability (clause 4, article 677 of the Civil Code of the Russian Federation).
All co-tenants must be indicated in the document.
The landlord can demand fulfillment of these obligations, for example, regarding payment, eviction on time, compensation for material damage, etc., from each tenant.

On the one hand, it’s easier when you have someone to ask and everything is “registered,” but on the other hand, it’s more difficult to do business with not one, but several co-tenants.

Registration of rights and obligations

The transaction must be concluded in writing. The contractual relationship is terminated only upon the expiration of the term, or refusal to extend or early termination.

The tenant has the right to terminate the document early if he has received written consent from all neighbors in advance if the landlord violates his rights or fails to fulfill his obligations. Therefore, let us examine this clause of the contract in more detail.

Rights and obligations of participants in legal relations

First, let's look at the responsibilities of each party that are included in the contract.

The Lessor undertakes:

Transfer to the tenant the property or its share in a condition that is not in disrepair and suitable for use.
Ensure that the transaction includes the operation of an apartment building, where the object of the contract is its component.
Provide the tenant with the necessary, required utilities for a fee.
Organize major repairs of the apartment, if required. It is worth noting that the landlord has the right to assign this responsibility to the tenants living in the residential premises.
Ensure the repair of equipment used for the direct provision of utilities to housing by tenants.

The rights of the landlord are typical with similar transactions for renting out residential premises, that is, they can demand timely payment for the use of the apartment, possible re-equipment (reconstruction) is carried out with the consent of the owner if it significantly changes the living conditions).

The tenant undertakes:

Use the apartment only for its intended purpose. If the residential premises are used for business activities, the residents will be immediately evicted through a unilateral judicial procedure.
Ensuring the original condition of the housing with subsequent maintenance in its original condition (cosmetic repairs are allowed, reconstruction with the permission of the property owner).
Timely payment of rent. Payments are regulated: if the contract is short-term, then they are made in a set amount (twice, three times), if it is long-term, then the payment date is determined.
Organize minor or major repairs of the premises, if this condition is provided for in contractual obligations.

The rights of the tenant are quite limited, like other similar agreements; it better protects the owner who rents out the premises. Residents have the right to be included in the list of co-tenants of people permanently living with them, yes, this is good, but this is possible with the written consent of the property owner.

When moving in new residents, the area allocated to each guest is taken into account; the norm for the number of square meters per person is regulated individually by each municipality. There are no uniform national standards.
There are life situations in which temporary guests (for up to 6 months) can move into a residential building; it seems that you need permission from all your neighbors and that’s it. But it doesn’t end there, you need to notify the landlord about this in advance, and if the total area for everyone in the residential premises, including a temporary resident, exceeds the norm for the total area of the apartment, the owner of the property can prohibit the residence of unauthorized persons.

In commercial leasing, as well as in leasing, there is the concept of sublease, which is identical to sublease, when the tenant can also rent out the premises in which he lives to other persons for a fee and for a certain period. This is carried out with the consent of the owner, but again depends on the area standards per person.

The employer also has the right to hire with the right to buy. After the expiration of the transaction, there are several ways for further developments: termination, prolongation (extension), repurchase from the owner of the rented residential premises.

Commercial rental with subsequent purchase

It is generally accepted that when renting housing from funds, subsequent repurchase is impossible, since the owners of the housing, as a rule, are either the municipality or the state. But this is not so, because there is a operative basis on which the legislation is based - the Civil Code of the Russian Federation. According to which both the purchase of municipal housing and privatization are possible.

But one thing should be taken into account: these transactions are not very common. Therefore, they do not have legal practice, especially when the owner is an executive authority. What is most perplexed is not the people who want to buy this property, but the administration itself. What should they do in this case? Usually, they turn to administrative acts and government regulations. Provisions allowing or prohibiting redemption. As a rule, such information is provided in advance as a separate clause in the contractual relationship.

What is the basis for the uncertainty of purchasing housing for commercial rent?

This procedure (subsequent redemption) is regulated by Art. 606 of the Civil Code of the Russian Federation. But if we turn to clause 2 of Art. 170 of the Civil Code of the Russian Federation, then the legislative part of the transaction may be considered unauthorized and invalid. To avoid such a situation, a purchase and sale transaction or other additional agreement is concluded, which will determine the procedure and conditions for the transfer of real estate to the new owner.

Since the amount of legal practice is insignificant, there is also little judicial practice. When considering such cases, judges either give permission to conduct such a transaction in accordance with Art. 624 of the Civil Code of the Russian Federation (regulates the purchase of removable (rented) property, or they refuse, since there are many contradictions not in the form of rental, but in the Civil Code of the Russian Federation.

Conditions for terminating a commercial lease agreement

The main conditions for termination are determined by Art. 687 Civil Code of the Russian Federation:

The contract can be terminated by mutual initiative of the parties, and if it comes from the tenant, he must obtain the consent of all permanent residents and notify the landlord in writing three months in advance.
Premature termination of the contract occurs in the following cases: failure to pay rent for more than 6 months (unless otherwise specified in the document).
damage to property;
failure to maintain proper sanitary conditions;
use of housing for other purposes (for example, converted into a massage parlor or storage room);
violation of the rights of neighbors (noise, scandals, loud music, etc.).