Urban leases

The Supreme Court (TS) has confirmed the sentence against a landlord (the owner of the premises) to pay a compensation for clientele to its tenant (who ran the business), after the rental contract of the premises ended. In this case, the tenant had been 10 years running a hospitality business in the premises (such as a bar or restaurant). When the time came to end the contract, the landlord refused to renew it , and also did not want to compensate the tenant as provided for in art. 34 of the LAU, which regulates this financial compensation when a business that has generated clientele in that location is lost.

In this case, the tenant had complied with what the regulation requires in order to claim since he expressed to the landlord his willingness to renew the contract for another 5 years and to market price , but the owner rejected that option. In addition, the tenant did not start any other activity in the 6 months following the expiration of the lease, a requirement that is also mentioned as necessary to be able to request this compensation. The landlord tried to avoid payment with a

very specific argument stating that hospitality is not "commercial activity of sale to the public" , which is the expression used in art. 34 LAU for compensation to exist. But the TS did not accept it. On the contrary, it expands the traditional interpretation of that concept and makes it clear that hospitality also falls within it, because it generates clientele and because there is direct selling to the consumer in a premises open to the public. With this, the TS reinforces and consolidates the jurisprudential interpretation on this point. to the consumer in a premises open to the public. In doing so, the TS reinforces and consolidates the jurisprudential interpretation on this point.