Lease Contract
Explanation
The lease agreement (le contrat de bail) is an agreement by which a person commits to giving another person the right to use a thing or a right for a specific period. This use is in exchange for a financial consideration (le loyer) that the tenant commits to paying. General lease includes real estate that does not yield natural fruits, tangible movable property, and rights.
The law does not allow the leasing of things that are consumed merely by their use. An exception to this is things that are leased solely for the purpose of display or inspection. On the other hand, it is permissible to lease things that lose part of their value due to normal use.
Proving an unwritten real estate lease agreement is subject to special rules. Before the start of the execution of the contract, it cannot be proven unless the defendant acknowledges its existence or takes an oath. However, if the execution of the contract has begun, this is considered sufficient evidence of its existence.
When there is a start of execution of a non-written contract and the parties disagree, an expert intervenes to determine the value of the consideration. As for the duration of the contract, it is determined based on local custom. If the lease period ends and the tenant remains in the place with the knowledge of the owner and without being asked to vacate, the lease is implicitly renewed (tacite reconduction).
The law imposes on the lessor the obligation of warranty (la garantie) towards the tenant. This warranty includes the tenant's right to use and dispose of the leased property without any opposition. It also includes the warranty that the leased property is free from defects.
The lessor's warranty is considered mandatory by operation of law even if it is not written in the contract. The lessor cannot evade the responsibility of the warranty under the pretext of good faith (la bonne foi). The good faith of the lessor never exempts them from this obligation.
Official legal articles
Think deeper
Why do you think the law allowed the leasing of things that lose their value through use, while it prohibited the leasing of things that are consumed by use except for the purpose of display?
Flashcards
What is the legal definition of a lease agreement in the Lebanese Code of Obligations and Contracts?
It is a contract where a person grants another the use of a thing or right. This use is for a specific period in exchange for a consideration (Article 533).
Is it permissible to lease a thing that is consumed by use?
It is not permissible, unless it is intended merely for inspection or display.
How is an unwritten real estate lease agreement proven before its execution?
It cannot be proven except by the defendant's acknowledgment of the existence of the lease or by taking an oath.
How are the consideration and duration determined in an unwritten lease agreement if its execution has begun and the contracting parties disagree?
The consideration is determined by an expert, and the duration is determined according to local custom.
When is the lease considered implicitly renewed?
If the tenant remains in the leased property after the end of the period and the concerned party leaves them in possession of it and does not request their eviction.
What are the two subjects of the warranty required of the lessor?
First, the use and disposal of the leased property without opposition, and second, the defects of the leased property.
Does the good faith of the lessor exempt them from the obligation to warrant against defects?
No, the good faith of the lessor does not exempt them from the obligation of warranty.
Practice questions
Which of the following things does the law prohibit leasing as a general rule?
The law prohibits a lease agreement on a thing consumed by use unless intended for inspection or display (Article 534).
How is the duration of an unwritten real estate lease agreement determined in case its execution has begun and the parties disagree?
The duration of the contract in this case is determined according to local custom when parties disagree (Article 542).
Two people verbally agreed on a real estate lease and execution has not yet begun. The owner denied the existence of the agreement. How can the tenant prove the contract?
An unwritten real estate lease agreement is proven before its execution only by the defendant's acknowledgment or oath (Article 542).
The lease period ended and the tenant remained in the real estate with the knowledge of the owner who did not request their eviction. What is the legal effect?
The lease is considered implicitly renewed if the tenant remains in the leased property without the owner requesting eviction (Article 542).
The tenant discovered a defect in the leased property. The lessor proved that they were in good faith and did not know about the defect. Does the lessor warrant this defect?
The warranty against defects is mandatory on the lessor, and their good faith does not exempt them (Article 552).
Case problems
Samir verbally agreed with Rami to lease Rami's apartment. Samir moved into the apartment and started living in it. After a month, they disagreed on the value of the monthly rent and the duration of the contract. Rami claimed that there is no written contract and therefore no lease, and Samir must leave. How is this dispute resolved legally based on the law?
Model answer
Since Samir moved into the apartment and started living there, this constitutes the start of execution of the unwritten lease agreement.
The start of execution is considered proof of the existence of the unwritten lease, making Rami's claim invalid (Article 542).
To resolve the dispute over the monthly consideration, this consideration is determined by an expert (Article 542).
As for the disputed duration of the contract, it is determined according to local custom.
Self-grading rubric
Dina leased a printing machine from a company for one year. After two months, the machine broke down due to an internal defect. The company refused to repair it under the pretext that they did not know about the defect at the time of leasing, and under the pretext that the contract does not include any clause stipulating a warranty against defects. Does Dina have the right to demand the warranty from the company?
Model answer
Yes, Dina has the right to demand the warranty from the company.
The warranty against defects of the leased property is an absolutely mandatory warranty on the lessor (Article 552).
This warranty remains mandatory even if it is not explicitly stipulated in the contract.
The company's claim of not knowing about the defect represents good faith, but the good faith of the lessor does not exempt them from the obligation of warranty (Article 552).
Self-grading rubric
Fadi leased a warehouse for two years. The two years ended and Fadi continued to use the warehouse as usual. The owner saw Fadi daily and did not ask him to vacate the warehouse. After four months, the owner requested Fadi's immediate eviction under the pretext that the contract duration had ended a long time ago. Does the owner have the right to evict him immediately based on the expiration of the original duration?
Model answer
The owner does not have the right to evict Fadi immediately under the pretext of the expiration of the original duration.
The lease period ended, but the tenant remained in the leased property.
The owner left the tenant in possession of the warehouse and did not request his eviction.
Accordingly, the lease is considered implicitly renewed and is subject to the relevant legal provisions (Article 542).