LAW OF OBLIGATION ACT, PART 3, CHAPTER 15, DIVISION 6

Division 6

Return of Leased Thing upon Expiry of Contract and Claims 

  • 334. Return of leased thing

(1) A lessee shall return a leased thing together with its accessories in a condition which conforms to the contractual use after the expiry of the contract. If, upon delivery of the leased thing to the lessee, an instrument of delivery concerning the thing is prepared, the thing is presumed to have been delivered in the condition set out in the instrument of delivery.

(2) The lessee shall be liable for the destruction and loss of and damage to a leased thing which occurs when the thing is in the possession of the lessee unless the lessee proves that the destruction, loss or damage occurred under circumstances which were not caused by the lessee or the person to whom the lessee transferred use of the thing in compliance with the contract. The lessee shall not be liable for the natural wear or deterioration of the thing or changes which accompany the contractual use.

(3) If a lessee has incurred expenses with respect to a movable for which the lessee can claim compensation, the thing may be withheld by the lessee until the expenses are reimbursed.

(4) Any agreement according to which the lessee, before termination of a lease contract, undertakes to pay compensation other than possible compensation for damage upon expiry of the lease contract is void.

(5) If the lessee transfers the right to use the thing to a third party, the lessor may, after expiry of the contract, demand the return of the thing even from the third party.

(6) A movable shall be returned at the place at which it was delivered, unless agreed otherwise.

  • 335. Claims arising from delay in return of leased thing

If a lessee does not return a thing after termination of the contract, the lessor may demand the rent agreed in the lease contract or rent which is usual in the case of a similar thing in a similar location as compensation for damage for the period of delay, unless the lessee justifiably withholds the thing in order to ensure payment for the expenses incurred thereby. This does not preclude the right of the lessor to demand compensation for damage caused to the lessor by the delay in the return of the thing in an amount which exceeds the amount of rent.

  • 336. Inspection of thing and giving of notification of defects to lessee

(1) Upon return of a leased thing, the lessor shall inspect the condition of the thing and promptly notify the lessee of any defects for which the lessee is responsible. If the lessor fails to do this, the lessor loses the rights which belong thereto based on the defects of the thing, unless these are defects which cannot be identified by ordinary inspection.

(2) If the lessor subsequently identifies a defect of the thing which cannot be identified by ordinary inspection, the lessor shall promptly notify the lessee thereof. In the event of failing to give notification of a defect of a thing, the lessor loses the rights based on the defect.

  • 337. Repayment of rent and accessory expenses paid in advance

If a lessee has paid rent or accessory expenses in advance for the period after expiry of lease contract, the lessor shall repay the advance payment to the lessee together with the interest provided for in § 94 of this Act.

  • 338. Expiry of claims

(1) The limitation period of a claim by a lessor for compensation for alteration or deterioration of a leased thing and a claim by a lessee for compensation for expenses incurred in relation to a thing or for removal of alterations is six months.

(2) The limitation period of a claim of a lessor for compensation shall commence as of the return of the thing. The limitation period of the claims of a lessee shall commence as of the termination of the contract.

(3) The limitation period of a claim of a lessor for compensation for alteration or deterioration of a leased thing shall expire together with a claim for the return of the thing.

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