LAND LEASE AGREEMENT: CLEARLY AND BRIEFLY ABOUT THE LAW
When working in the agricultural sector, it is extremely important to understand first of all the legal aspect and the legal basis. In this regard, it is advisable to consider in the most general and understandable form of the Law of Ukraine "On Land Lease".
According to the Law, a land lease agreement is an agreement that defines the lessor's obligation to transfer a certain plot of land to the lessee for a corresponding monetary reward (fee) for a specific period of possession and / or use specified in the agreement. The lessee, for his part, is responsible and obliged to use the land in accordance with the terms of the contract and in accordance with current legislation of Ukraine.
Who can act as a landlord? This is primarily:
- the state;
- united territorial community;
- Municipal Enterprise;
- citizens / legal entities / (persons authorized by them) who own land plots.
Who can act as a lessee? This is primarily:
- public authorities;
- local authorities;
- citizens / legal entities of Ukraine;
- foreigners / stateless persons;
- foreign states;
- international organizations / associations.
What features of the land lease agreement can be distinguished?
First, it should be noted that the law does not set any restrictions on the type of land to be leased. The land plot can be leased either together with any buildings, structures, existing reservoirs or plantings installed on it, or without them.
Secondly, a written land lease agreement is a mandatory requirement. The agreement may be notarized if one of the parties has expressed his wish in this regard. The agreement comes into force from the moment of obligatory state registration.
Third, it is worth paying attention to the term of the contract, which is determined by agreement of the parties concerned, and according to the rules can not exceed 50 years.
Fourth, it is important to keep in mind the possible grounds for denial of state registration of the contract, and hence its invalidation. Such grounds may be a violation of the requirements of current legislation of Ukraine, the absence in the contract of one of the essential conditions provided by law.
What are the essential terms of the land lease agreement? These are primarily:
- lease object (location and size of the land plot);
- the term of the lease agreement;
- rent (amount, indexation, forms of payment, terms, order of payment, terms of review, liability for non-payment);
- conditions of use and purpose of the land plot;
- terms for maintaining the condition of the leased object;
- conditions for maintaining the condition of the leased object;
- existing restrictions on land use;
- responsibilities of the parties.
It should also be noted that the contract may specify other conditions, but only at the request and consent of the parties. Such conditions may be, for example:
- quality and structure of the land plot, their improvement;
- insurance;
- the procedure for fulfilling obligations by the parties;
- compensation of certain types of expenses;
- security;
- reclamation and cadastral works;
- force majeure.
And what about making changes and terminating the lease of land?
1. There is only one way to change some terms of the lease "peacefully": mutual consent of the parties. Otherwise, the dispute will have to be resolved in court.
2. The lease agreement may be terminated by mutual consent of the parties.
3. A unilateral desire to terminate a contract must be provided for in the contract and have an appropriate mechanism. At the request of one of the parties, the lease agreement may be terminated early by a court decision in the manner prescribed by law.
4. The landlord has the right to terminate the lease agreement if the lessee improperly or systematically fails to fulfill the terms of the agreement. For example, the reason may be damage or use of land for other purposes or contrary to any conditions specified in the contract (deterioration of quality, use of harmful substances, depletion of land, etc.).
5. The main obligation of the lessee in case of termination / cancellation of the land lease agreement - to return the land to the lessor on the terms specified in the agreement and within a specified period. If the lessee does not fulfill its obligations regarding the conditions of return of the land plot to the lessor, it will be obliged to fully reimburse the lessor for the damages caused.
Therefore, in order to prevent undesirable situations, it is necessary to act in accordance with the current legislation of Ukraine, among other things, to use the adopted standard form of land lease agreement approved by the Cabinet of Ministers of Ukraine.
The FP team is always aware of the latest developments and innovations in the legislation of Ukraine, first of all in order to constantly increase the level of their awareness and competence, and as a result - to support their customers and provide qualified assistance.
Analyst: Victor Kryzhanivsky