4 June 2018

Mykhailo Honcharov tells about what should be taken into account when executing residential lease agreement

Official statistics say that approximately 1.4 million Ukrainians live in rented accommodation. But the unofficial figures are much higher. There is nobody who could actually say what the exact number of tenants is. The reason behind this is that 70% of residential leases are not officially executed.

Sehodnia newspaper has asked  Drozdova & Partners Law Firm senior partner Mr Mykhailo Honcharov to tell about how not to fall victim of scammers when renting accommodation.

The first thing that should be done when executing a lease agreement (relevant requirements are specified in Chapter 59 of the Civil Code) is to check whether the landlord actually owns the residential property. For identification purposes, the agreement should specify the passport details, the identification code and the title document (generally, a certificate of title to real property). ‘It is therefore recommended that you ask to provide the original copies of the abovementioned documents and make sure that you are dealing with the person who is entitled to let the residential property on lease,’ the expert says. If there is more than one owner, the written consent of each other owner should be obtained to be sure that they do not object to the lease. Indeed it may occur that one of the owners may choose to let the residential property on lease without the knowledge or consent of the other owners.

It is also advised that the owner of the residential property produce the original copies of documents (receipts, statements, etc) showing that he is not in arrears with his utility bills. ‘If any such debt does exist, all aspects related to the payment thereof should be separately spelled out in the agreement together with precise amounts of those arrears. Any uncertainty may result in conflicts,’ Mr Honcharov firmly says.

The expert has also pointed out that the Ukrainian Civil Code says in Article 815 that it is the tenant who is responsible for preservation of the residential property in proper condition. ‘If you discover any defects in the operation of household appliances or where any household appliance or device is out of order, or if any furniture or any other design element is damaged, you should request that the landlord specify such circumstances in a separate property acceptance statement,’ the lawyer has pointed out. ‘This fact should be spelled out in the lease agreement as an integral part thereof. You will not therefore be responsible to the accommodation owner for any damage to his property that you have never caused.’

The agreement should certainly set out the rights and obligations of the landlord and the tenant, the term of the lease, the conditions of and procedures for the termination of the lease, the amount of the rent and the manner in which it should be paid.

But there are still some commonly ignored aspects: ‘The landlord may choose to prohibit the tenant from keeping any pets in the accommodation or doing any business. It is therefore advised that you address any such issue on your own initiative without relying on ‘standard terms’ to avoid that the landlord have any ground to have you evicted at his earliest convenience,’ Mr Honcharov has recommended.