Court Practice on Leases

 

On 17 December 2011 a Plenary Session of the Supreme Commercial Court approved Resolution No. 73 “On Certain Aspects of the Application of the Russian Civil Code Provisions on Lease Contracts.”

In particular, the Court clarified that a contract on the lease of state or municipal property may only be made based on a tender. This requirement does not interfere with the current lessee’s pre-emptive right to make a new lease contract in circumstances provided for under the Civil Code. If the lessor infringed on this right of the lessee by conducting a tender and entering into a contract with the winner, the lessee may claim in court the transfer to it of the rights and obligations under such contract. If the lessee’s claim is satisfied, the winner of the tender may demand payment of compensation for losses incurred in relation to its participation in the tender.

The Court further clarified that unless otherwise provided for under the law or a contract, the purchaser (lessee) shall terminate the obligation to pay rent from the moment of execution of the contract on the purchase of the leased property. However, in the event a land plot’s purchase, the purchaser has to refund the seller’s land tax payment expenses because the seller carries this obligation until the transfer of title to the land plot is registered.

The Resolution is mandatory for lower commercial courts when considering similar issues

For further information please contact Igor Ostapets or Irina Dmitrieva in the Moscow office of White & Case, tel + 7 495 787 3000 .

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