With its recent decision no. 971/2022, the Hellenic Supreme Court clarified that the provision concerning the three-month notice period in cases of termination of commercial leases concluded after 2014 refers to termination taking place after the minimum duration of three years has elapsed, at which point the lease becomes indefinite-term.
Under the previous legal regime for commercial leases, which was governed by Presidential Decree 34/1995, the tenant was granted the right to terminate the lease due to a change of mind. In such cases, according to Article 43 of the decree, there was no obligation to even state the reason for the change of mind. This right, however, ceased to exist for tenants under the new legal framework (Law 4242/2014), which applies to commercial leases entered into from 2014 onwards.
According to Article 13(1) of Law 4242/2014:
“The leases referred to above shall be valid for three (3) years, even if agreed for a shorter or indefinite term, and may be terminated by a later agreement evidenced by a document with a certain date. Termination shall be in writing, and its legal effects shall occur three (3) months after its notification.”
The rather poorly drafted reference in the last sentence to the right of termination raised the question: Which type of termination does this provision refer to? This became especially relevant given that the right to terminate due to a change of mind before the expiry of the minimum legal duration was now explicitly abolished.
In its decision, the Supreme Court ruled that:
“It does not follow from the law that the tenant is granted the right to terminate the lease at any time and entirely without consequences for them, in breach of the agreed terms and the statutory three-year lease duration, which is binding on the contracting parties. Furthermore, landlords cannot waive the obligation of the three-year duration in accordance with Article 45 of Presidential Decree 34/1995, which continues to apply to leases concluded after the enforcement of Law 4242/2014.
Clearly, the three-month period provided by law applies in cases where, after the expiry of the three-year term and the tenant remains in the property, the lease becomes of indefinite duration under Article 611 of the Civil Code.”
In any case, the Supreme Court, through its decision, reminds us that commercial leases governed by the new legal framework may still be terminated — like any fixed-term contract — for good cause. Good cause may exist, for example, when the continuation of the ongoing contractual relationship becomes excessively burdensome for either party, such as when the tenant repeatedly misuses the leased property, or when one party persistently fails — despite warnings — to fulfill their contractual obligations.
