Rental Contract According to the Civil Code

Rental Contract According to the Civil Code: Know Its Pitfalls and Advantages

The Civil Code (Act No. 40/1964 Z.z., seventh chapter) is the standard that applies to every rental contract, unless you explicitly specify that you are governed by the Short-term Rental Act. This law was created with the aim of protecting the tenant as the weaker party, which is reflected in an imbalanced relationship in favor of the tenant. Interestingly, a contract under the Civil Code does not even need to be in written form; a record of an oral agreement is sufficient. However, we strongly recommend always concluding contracts in writing, ideally with notarized signatures, which increases legal certainty.

What are the basic features of a contract under this law?

  • Notice period: Minimum 3 months, which extends by another 6 months if the tenant is in material need.
  • Duration of lease: Possible for any period, including indefinite duration.
  • Termination of apartment lease: A fixed-term contract automatically ends upon expiration of that period.
  • Extension of lease of other real estate: If the tenant uses other real estate (e.g., house, garage, cottage, non-residential space) even after the lease ends and you as the landlord do not file a proposal for eviction, the contract automatically extends under the same conditions, but for a maximum of 1 year.
  • Inspections during notice period: The tenant is obliged to tolerate inspections for the purpose of further rental, unless agreed otherwise.
  • Sublease: The tenant has the right to sublet the rented property, unless the contract provides otherwise.
  • Liability for damage: The tenant is obliged to take care that no damage occurs to the rental property, otherwise they are liable for it.
  • Condition upon return: The tenant is obliged to return the rented property in the condition in which they received it, taking into account normal wear and tear.
  • Notification of repairs: The tenant is obliged to notify the landlord of the need for repairs that the landlord must perform, otherwise they are liable for the damage caused.
  • Costs of use and minor repairs: These costs are borne by the tenant, unless agreed otherwise.
  • Right to discount/exemption from rent: The tenant is not obliged to pay rent if they could not use the rented property in the agreed manner due to damage not caused by them, or they have the right to a reasonable discount.
  • Possibility of contract withdrawal: The tenant is entitled to withdraw from the contract if the rental property has become unsuitable for normal use or if staying in it is harmful to health.
  • Restrictions for the owner and grounds for termination: The property owner can terminate the contract only in a legally limited scope (e.g., need for apartment for themselves/close person, gross violation of obligations by the tenant, non-payment of rent). In some cases, the tenant may be entitled to housing compensation and reimbursement of moving costs.
  • Disputes and termination: Filing a lawsuit by the tenant for invalidity of termination suspends the legal effects of lease termination – the termination becomes effective only after the court decision becomes final.

What must a contract under the Civil Code contain?

To be valid, the contract must specify:

  • Designation of the rental property and the scope of its use.
  • Amount of rent and payments for services related to apartment use.
  • Description of equipment and current condition of the apartment.

What does the Civil Code not describe? How to solve it?

The law does not specify how to resolve some key aspects that are important for the landlord. If you want them addressed, you must clearly define them directly in the contract:

  • Unilateral change in rent amount (for example, in response to inflation):
    • Solution: Agree in the contract on a mechanism for rent increases, for example, tied to inflation or the consumer price index published by the Statistical Office of the Slovak Republic. Without such a clause, changing the rent can be difficult.
  • Method of calculating rent and payments for services related to apartment use:
    • Solution: Clearly specify not only the amount of rent but also the breakdown of energy deposits (water, gas, electricity, heating) and other services (garbage, common areas). Set deadlines and method of settlement of these advance payments.
  • Financial security (deposit):
    • Solution: Although the Civil Code does not directly define a deposit, you can agree on it in the contract as a "monetary security" to cover arrears, damages, or rent arrears. However, it is crucial to detail the conditions of its use and return, otherwise its enforcement can be complicated and court disputes over its purposeful use are not exceptional.

When to choose the Civil Code?

A rental contract under the Civil Code may be suitable for:

  • Long-term and stable rental relationships where there is a high level of mutual trust.
  • Rental of other real estate than apartments (for example, houses, garages, cottages, non-residential spaces) where the Short-term Rental Act does not apply.

If you are renting an apartment and looking for greater protection and flexibility, see our article on the Short-term Rental Act, which brings modern solutions for the current market.

 

 

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