High Court outlaws statutes protecting commercial property tenants in landmark ruling

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By Staff Reporter

THE law which protected tenants renting commercial properties has been overturned by the High Court in a landmark ruling which orders them to immediately vacate premises after expiry of contract.

Previously, tenants were protected by Sections 22 and 23 of the Commercial Premises (Rent) Regulations, 1983, which authorised them to continue staying or using premises despite expiry of contract.

High Court judge Justice Webster Chinamhora found that sections of that law were unlawful and unfair.

Sections 22 and 23 declared that the owner of the building was prevented from evicting the tenants as long as they were abiding by the terms and conditions of the expired leases.

“A cumulative reading of section 22 and 23 shows that these provisions unfairly limit the powers of a court in ordering eviction and heavily restrict the lessor’s rights to terminate occupancy or seek eviction and possession of the premises after the lease expires.

“The regulations create a forced relationship between the lessee and the lessor known as statutory tenancy. My view is that sub-paragraphs (i) and (ii) of section 22 (2) effectively preclude the lessor from increasing rentals or leasing out the property to another person once the statutory tenancy protection applies.

“I would add that section 23 fortifies the protection accorded under section 22 of the Regulations and entitles the lessor to all the other benefits arising from the original contract.

“It is precisely for these reasons that section 22 and 23 of the Regulations are ultra vires the Commercial Premises (Lease Control) Act and set them aside.”

The ruling follows a legal dispute between a Harare-based company, Elnour United Engineering Group Private Limited and Industry and Commerce minister Sekai Nzenza.

Elnour United owns Gulf Complex and Sunshine Bazaar in Harare central business district and Mbare respectively.

The company argued that the regulations went beyond the powers of the Commercial Premises Act.

It sought an order directing Nzenza to make regulations that address the interests of both the lessor and lessee.

Nzenza had argued there was nothing discriminatory in the said provisions since section 23 of the Rent regulations deals with rights and duties of the lessee.

The minister further submitted that the company had failed to exhaust local remedies before asking the court to intervene.