Rental: a verbal agreement is also valid
Rental: a verbal agreement is also valid
November 2021 – "Verba volant, scripta manent". This Latin adage means: words fly, writings remain. The principle is sound in many respects, but in the case of contracts you should not lose sight of the fact that words can also have lasting consequences.
Non-performance of the lease agreement
Two parties are negotiating about the potential rental of a house. They quickly agree on the conditions, but the signing of the lease agreement does not go so well. The future lessee must also pay the guarantee, which is rather laborious.
The agreed date for signing the contract is postponed several times. Initially, the lease agreement was to take effect on 1 August, but this date was also postponed by a month. On 8 August, the potential lessee finally sent a text message to cancel the lease agreement.
His exact words are : Madam, Sir, the lease agreement is cancelled. Yours sincerely, S.S. and A.S.
The landlord does not appreciate this and demands damages of three months' rent. According to the landlord, there was a lease agreement and the lessee terminated it.
The lessee wins the case at first instance, but the landlord appeals the decision.
Proof of the existence of a contract
Where a lease agreement has been concluded orally but not executed, the existence of the lease agreement cannot be proved by witnesses. Only an oath by the person who denies the existence of the lease contract can - according to the Civil Code - serve as evidence.
But the Code does not prohibit extrajudicial confessions. The justice of the peace called upon to rule this case considers that a confession has the effect that a lease contract can be definitively proven. In this case, the judge inferred the proof of the contract from the lessee's text messages.
The obligation to pay rent is an obligation that arises from the mere agreement between the parties. In other words, the parties would have formed an oral contract. The obligation to pay rent arose at that point.
If the lessee changes his mind between the verbal agreement and the signing of the contract, this does not change the obligation to pay.
There was a breach of contract in this case.
The damage
However, the judge was lenient in calculating the damage in the form of lost rental income. According to the judge, the tenants' breach deprived the landlord of rental income for the months of September and October. In August, he would not have received any income anyway, as the contract was not to take effect until 1 September. The landlord is therefore awarded compensation of two months' rent.
However, the bill for the breach of the verbal lease contract is high. The lessee has to pay the landlord 3 100 euros in rent - plus interest - and must also pay the costs of the summons (392,29 euros), the procedural fee (1 080 euros), the contribution to the budgetary fund for second-line legal aid (20 euros) and the procedural fee for the appeal (1 080 euros).