On June 30, 2022, Law No. 21.461, hereinafter referred to as the “Law”, was published in the Official Gazette, which incorporates a precautionary measure for the early restitution of real estate and establishes a procedure for the collection of rental income. For these purposes, on the one hand, the Law amends Law No. 18.101, which establishes the special rules on leasing of urban properties and, on the other hand, deletes in paragraph 6 of the second subsection of Article 680 of the Code of Civil Procedure the expression “and precarious gratuitous bailment”.
The purpose of the Law is to protect with greater strength the rights of the lessor, mainly in cases of: (i) a serious lack of care of the lessee with respect to the property; and (ii) cases of serious delinquency in the payment of rent and bills by the lessee.
The Law protects these rights through 3 elements, namely: (i) it incorporates a precautionary measure for the early restitution of real estate; (ii) it incorporates an order for payment procedure for the collection of rent; and (iii) it establishes new formalities for written lease agreements.
1. Early restitution.
Incorporates in Article 8 of Law No. 18.101 a new paragraph 7 bis, by virtue of which the judge is granted the power to “order the early restitution of the property and the launching of the defendant lessee, with the assistance of the public force if necessary”.
It is necessary to indicate that such measure will proceed in those cases in which the lessor demands “the termination of the lease contract and the restitution of the leased property, for having been partially destroyed or rendered unusable for its use as a consequence of the action or omission of the lessee in its care”.
Finally, since this new power is a precautionary measure, the judge is empowered to require, at his discretion, the delivery of a bond by the plaintiff, which will serve for the payment of the eventual damages that the lessee may suffer in the event of a possible final judgment that does not condemn him to the restitution of the property.
2. Payment for payment procedure for the collection of rents.
The second relevant element of the Law is the implementation of an order for payment procedure for the collection of rents owed. In order to initiate this procedure it is necessary to file a lawsuit for the collection of such rents, together with the request for the restitution of the property that is the object of the lease. Such demand must expressly include the unpaid debt, whether it be rent, common expense accounts, utility bills, all derived from the lease agreement. In addition, the lessor must request that the debtor be required to comply with the payment within a period of 10 calendar days. This request must include the expenses and rents accrued after the filing of the claim, plus the corresponding interest and costs. Once these requirements have been met, the judge will accept the claim and order that the debtor be required to pay, so that it complies with its obligation within the aforementioned 10-day period.
It should be noted that, in this same resolution where the judge requires the tenant to pay, it will be stated that in the event that the latter “does not pay or does not appear or does not oppose, he will be considered as condemned to pay” the debts claimed against him, and the eviction will be carried out within a term not exceeding ten days.
As a last modification of a procedural nature, the Law makes the payment order procedure described above applicable, as appropriate, to the actions of precarious bailment that seek the restitution of the property and to the action of precariousness established in article 2.195 of the Civil Code.
3. Formalities for lease contracts.
On the other hand, the Law replaces Article 20 of Law No. 18.101, requiring certain formalities when the lease contract is in writing and establishes a presumption with respect to the amount of the rents in the case that the contract is only consensual.
In effect, in contracts in writing, and which are governed by Law No. 18.101, the signatures of the contracting parties must be authorized by a public notary, who must also “request the titles that enable the lessor to assign the use of the property in respect of which the contract is made”. The contracts authorized in this way will constitute a sufficient precedent to file a claim for the restitution of the property together with the collection of debts in the payment order procedure indicated in point “2” of the present legal alert.
Finally, with respect to contracts that are not in writing, it is provided that “it will be presumed that the rent is the amount stated in the deposits or payment documents for at least three consecutive months and, in the event that these do not exist, it will be presumed that the rent is the amount stated by the lessee”.