Rights at the expiry of rental agreement

“The owner is entitled to payment of the rent amount as mesne profits until possession is surrendered”

The property owner who notifies the tenant at the expiry of the rental agreement that he does not intend to renew it and calls on the tenant to surrender the property, is likely to face the tenant's refusal to comply and non-payment of the rent amount as mesne profits. The former tenant, taking advantage of holding possession of the property until trial of the landlord’s lawsuit for recovery of possession, seizes the property and does not pay any amount. The owner's loss in this case can be large and continuously increase month by month, creating an unbearable situation for him, especially if he has obligations or relies on the income from the amount paid as rent or the former tenant is not a creditworthy person. There is an option for the landlord to submit an application for interlocutory relief, seeking an interim order against the former tenant for payment of the amount of rent as mesne profits, for as long as he retains possession of the property and pending trial of the lawsuit. The owner can base his application on Article 32 of the Courts Law, L.14/1960 and on Article 4 of the Civil Procedure Law, Cap.6.

The landlord due to the nature of his actionable right in his lawsuit seeking an injunction ordering the former tenant to surrender the property, plus an amount of the rent or the rental value as mesne profits or compensation for loss of use, he has no other remedy available. Attempt to secure an interim order will not succeed, since the Court is not permitted at the initial pre-trial stage to enter into the merits of the dispute nor to grant a final remedy. Also, in the case of an application for summary judgment, depending on the former tenant's position, again the Court will not grant the landlord a final remedy, without giving the former tenant the right to be heard.

The District Court of Paphos in its decision issued on 28.08.2023 examined such an issue. The owner of a property with his lawsuit claims that the rental agreement has expired and requests an order for its recovery, as well as an amount of €2000 per month provided for in the agreement, as mesne profits until the delivery of possession and other remedies that the company former tenant is illegally interfering with the property. The owner, after his application for summary judgment was dismissed, filed an application against the former tenant being in possession of the property and claimed an interim order for payment of the amount that the tenant was paying as rent, without accepting that this amount is rent or is the due amount, until the trial of the action. The former tenant, according to the owner's allegations, stopped paying any sum for the use of the property, he already created an accumulated debt of €48,000, which is increased monthly, while he is insolvent.

The Court examined the application within the law and case law for an interim order, finding that the owner had disclosed a debatable issue which could and should be tried to reveal the full factual dimension. It concerns his right, as the registered owner of the property, to take possession after the expiry of the tenancy agreement entered into with the company former tenant. His allegations are specific based on documents, and there is nothing that preliminarily prevents the Court from examining his action. The Court was satisfied that both the first two conditions of Article 32 of Law 14/60 and the third condition are met, adding that it shares the owner's position that, if the requested order is not issued against the company, in the form of interim remedy, it will be difficult or impossible to do full justice at a later stage.

The balance of convenience or justice, as the Court held that since the company is in possession of the property while the lawsuit is pending and there is a willingness to pay for its possession to the owner, it does not follow that the issuance of the requested order will cause damage to the company, while it will prevent the loss of the owner and the company to benefit free of cost from possessing the property. For this reason, it issued the interim order ordering the company to pay the amount of the rent per month to the owner while it retains possession of the property or until the trial of the lawsuit.