13 Dec Recovery of possession of shop for own use
Recovery of possession of shop for own use
by George Coucounis
“The tenant bears the burden of proof that he will suffer more hardship from the issuance of the repossession order”
It is lawful for the landlord to claim the recovery of possession of his property, whether a house or a shop, for his own residence or for his own use or for the use by a close relative. When the property falls under the Rent Control Law, the landlord is required to meet the relevant provisions of the Law and in particular that the property situates in a rent control area and the tenant is statutory. Moreover, the landlord must have served the tenant with a written notice at least one month prior to the filing of the application and the repossession of the property must be reasonable required by the landlord, who must prove that he is unable to secure a similar property with reasonable rent for his business. Additionally, the Court must consider that the issuance of the order is reasonable and that its issuance will cause less hardship than its non-issuance. The satisfaction of these requirements burdens the landlord, except the determination which party will suffer greater hardship from the issuance of the order, a requirement that burdens the tenant.
The landlord in order to succeed in his application must prove that his claim is reasonable and that he is unable to find a similar property with reasonable rent for his business. Furthermore, he must include in his application and prove his financial ability to compensate the tenant in case of issuance of the order. With regard to the effect of the issuance or non-issuance of the order, the landlord ought to weigh and take into account all the facts concerning the case, as well as the hardship which will be caused to both him and the tenant and to third parties directly affected. If the tenant has a profitable business in the property and employs a number of employees, this fact will be taken into consideration by the Court in assessing the requirement which of the parties will suffer greater hardship from the issuance of the order.
The claim of a landlord to recover possession of a shop for his own use was examined by the President of the Rent Control Court in a judgment issued on 7.12.2021. The Court indicates the legal framework that governs this claim and examined the facts of the case in relation to the provisions set out in the Law as analysed in the case law. It is clear that the landlord, before deciding to file an application and claim recovery of possession of his shop for his own use, should consider all the parameters and proceed if he finds that they are met. As the Court emphasizes, the recovery of possession of a shop for own use requires proof of the reasonableness of the claim and proof of the inability of the landlord to secure a similar property, compared to his shop, with reasonable rent for his business. The concept of similar can be ascertained comparatively. The Court also states that case law confirmed the obligation of the landlord to prove, through clear and credible evidence that he has made, unsuccessfully, those necessary efforts to find another property.
With regard to the criterion whether the claim is reasonable within the ambit of the Law, the Court states that this is objective and not subjective. Also, it is necessary to take into consideration and weigh the hardship that will be caused to each side from the issuance or non-issuance of the order; this time the burden of proof is shifted to the tenant, who must convince the Court to decide to his favour. Where the recovery of possession concerns a shop, the Court underlined that under article 12 of the Law, the landlord may be ordered to pay the tenant compensation not exceeding an amount equal to the 18 months’ market rent. In addition, the Law provides for the possibility of payment of compensation for the loss of goodwill.
Regarding the effect of the issuance of the order to third parties, the Court stressed that it is important to take into consideration the consequences and pointed out that it is necessary to take into account all the facts surrounding the case. The Court concluded that even though the landlord’s wish to help his daughter’s professional development was respected, the issuance of the requested order would obviously cause greater consequences and disproportionate hardship to the tenant. As a result, the Court dismissed the application of the landlord.