Commercial rent payments in Belgium

Since the outbreak of the Covid-19 pandemic early 2020, the Belgian Government has adopted some measures to try to control the virus spread as much as possible. More particularly, the Government adopted on 18 March 2020 the Ministerial decree on urgent measures to limit the spread of COVID-19 coronavirus, which was amended several times subsequently. This Ministerial decree imposed, amongst other measures, the mandatory closure of some retail and “horeca” (hotel-restaurant-café) premises. Understandably, the main question quickly raised whether the tenant still had to pay rent event tough he was not entitled to open his business.

As expected, this has led to some court decisions. On the basis of the current case law, it is currently difficult to identify a clear trend. Moreover, it is important to bear in mind that all those decisions have been taken by the Justice of the Peace which is the first trial judge (juge de fond). We are still waiting for the first appeal decision which may identify a more precise trend. 

Subject to future case law and decisions to be taken by appeal courts, no argument put forward by the tenants before the courts currently enables them with certainty to escape their obligation to pay rent, although the grounds relating to (i) force majeure, (ii) the risk theory, (iii) hardship and (iv) the abuse of right seems to be the most invoked by the tenants before the courts.

This argument has not always been accepted by the courts. There is indeed no consensus to date as to whether the closure measures or the pandemic meet the necessary conditions to constitute force majeure. 

The main counter-argument invoked by the landlords consists in stating that Belgian law is not familiar with the concept of "financial" force majeure which means force majeure is excluded when the obligation is the payment of a monetary debt. This principle has been confirmed by the Court of cassation.

The risk theory is a general principle under Belgian law which, in lease matters, is based on article 1722 of the Belgian Civil Code and states that in a reciprocal contract, such as a lease, the correlative obligations of the other party lapse if the obligation of one of the parties cannot be fulfilled.

This legal ground has been invoked frequently by the tenants and has led sometimes to (partial) rent exoneration in their favour.

Such principle provides in the possibility of requesting a renegotiation of the contract in the event of a change in circumstances unforeseeable at the time of the conclusion of the contract making performance excessively onerous for one party. 

Although the doctrine of hardship has not yet been formally enshrined in Belgian law (but will most probably be in the near future), some tenants already invoke this legal ground to request the renegotiation of the lease agreement.

Since this principle has not yet been adopted under Belgian law, the judges are reluctant to accept any argument based on hardship to date. This might change in the future of course.

According to Article 1134, par. 3, of the Belgian Civil Code, contract must be concluded in good faith. Therefore, each of the parties must behave as a prudent and reasonable person would behave in the same circumstances in the performance of the contract. No one may abuse of the rights he derives from the contract.

Abuse of rights must be assessed by taking into account the concrete circumstances and the attitude of the party claiming abuse of rights (the tenants) and the party accused of abuse of rights (the landlords). Hence, it is crucial to argument and motivate precisely any facts that may lead to consider the right as “abusive”.