The reduction in consumer purchasing power, the general economic crisis, as well as the imposition of austerity measures and other fiscal and tax measures, do not constitute extraordinary and unforeseeable events justifying the adjustment of rent in commercial leases, according to Article 388 of the Civil Code.
According to Article 388 of the Civil Code, it is stated that:
“If the circumstances on which the parties primarily based the conclusion of a bilateral contract, in view of good faith and commercial customs, have changed subsequently due to reasons that were extraordinary and could not have been foreseen, and because of this change the obligor’s performance, taking into account the counter-performance, has become excessively onerous, the court may, at the request of the obligor, adjust it to an appropriate degree and may decide to terminate the contract entirely or in part for the part not yet performed.”
The provision of Article 388 of the Civil Code also applies, by explicit provision of Article 7 paragraph 4 of Presidential Decree 34/1995, to commercial leases. Therefore, the conditions for adjusting the rent according to the above provision are:
a) A change in the circumstances primarily relied upon by the parties when concluding the contract, based on good faith and commercial customs,
b) The change may occur after the conclusion of the contract and be due to reasons that are extraordinary and unforeseeable, and
c) Due to this change, the obligor’s performance, considering the counter-performance, becomes excessively burdensome.
Such circumstances are those that do not occur in the normal course of events but are caused by unusual occurrences — whether natural, political, social, or economic — which result in a complete disruption of the balance between performance and counter-performance. The general economic crisis, the imposition of austerity measures, and generally fiscal and tax measures that reduce consumers’ purchasing power and consequently commercial activity in shops, do not constitute extraordinary and unforeseeable events, especially in the Greek economy, where fluctuations in stability have long been continuous, particularly under current liquidity conditions and the international economy (Supreme Court Decisions 928/2020, 765/2020, 800/2020, 298/2018, 1088/2017).
Also, extraordinary and unforeseeable events cannot be considered those that commonly occur, such as fluctuations in a business’s revenue, changes in the tenant’s financial condition, increases or decreases in the value of the property and the corresponding change in rental value, which may be due, for example, to fluctuations in demand for similar properties, increases in cost of living, etc. (Supreme Court Decisions 1330/2020, 928/2020, 844/2018, 1592/2014, 998/2014). The recent Supreme Court decision No. 24/2023 has reached similar conclusions.
