This piece of legislation regulates the continuation of tenancies by establishing the means testing criteria which must be satisfied in terms of Article 1531F of the Civil Code for a successful claim of tenancy continuation.
Article 1531F of the Civil Code deals with the definition of a tenant in a residential tenement and states that where a lease of a house made before 1st June 1995 is being used as an ordinary residence, the person occupying the tenement on the 1st June 2008, under a valid title of lease, as well as that person’s spouse, is deemed to be the tenant and when the surviving spouse dies the lease shall be terminated. However, a person can still continue the lease after the death of the tenant and under the same conditions in four cases.
- If that person is the natural or legal child of the tenant and has been residing with the tenant for four out of the last five years and after 1st June 2008 continues to live with the tenant until his or her death, the lease may continue. However, this lease cannot extend to the spouse of offspring of the child, it only applies to the natural or legal child.
- The lease can also continue in the case were the person is sibling of the dead tenant or of the dead tenant’s spouse, who is forty-five years of age or older and has lived with the tenant for four out of the last five years before the 1st June 2008 and lived with the tenant after such date until his or her death. However, the lease cannot extend to the spouse or children of the sibling.
- Where the lease may continue after the death of a tenant is if a person is the natural or legal child of the tenant, is younger than five years and after 1st June 2008 continued to live with the tenant until his or her death.
- If the person is the natural or legal ascendant of the tenant, is forty-five years of age, lived with the tenant for a period of four years out of the last five years before the 1st June 2008 and continued living with the tenant until his or her death, can also continue the lease. However, this lease cannot extend to the spouse or children of the ascendant. In the above situations, where there is more than one child, sibling or ascendant, and the relevant conditions have been satisfied, they may continue tenancy in solidum.
Furthermore, a person will not be considered to not have lived with the tenant if the person was absent from the residence due to work, study or medical care. Additionally, a person is not entitled to continue the lease following the death of the tenant, unless such person satisfies the means test criteria and in order to satisfy such criteria, a person is required to have both an income and capital within the limits established by the Continuation of Tenancies Regulations.
In terms of the Means Testing Criteria, ‘income’ has the same meaning as the sources mentioned in Article 5 of the Income Tax Act such as inter alia gains or profits arising from any transfer of ownership or usufruct of any immovable property or the assignment or cession of any rights over such property and gains or profits arising from the transfer of the ownership or usufruct of or from the assignment or cession of any rights over any securities, business, goodwill, business permits, copyright, patents, trademarks and trade-names and any other intellectual property. It also has the same meaning as Article 4 of the same act, sub-articles 1(a), (b), (c), (d), (e), and (g) excluding all provisos and sub-articles 2, 3(a) excluding the proviso and 3(b).
During the relevant period, which is the period between 1st January and 31st December during the year preceding the tenant’s death, a person who on the date of death of the tenant is:
- Younger than forty-six (46) years of age, cannot have an income exceeding €25,000.
- Forty-six (46) years of age or older, cannot have an income exceeding €42,000.
- Younger than forty-six (46) years of age, has a severe disability and registered with the Commission for the Rights of Persons with Disability, cannot have an income exceeding €42,000.
- Forty-six (46) years of age or older, is disabled (severity not required) and registered with the Commission for the Rights of Persons with Disability, cannot have an income exceeding €55,000.
As for capital, the relevant period is the date of the death of the tenant and a person who is:
- younger than forty-six (46) years of age, cannot have capital exceeding €125,000.
- forty-six (46) years of age or older, cannot have capital exceeding €200,000.
- younger than forty-six (46) years of age, has a severe disability and registered with the Commission for the Rights of Persons with Disability, cannot have capital exceeding €200,000.
- forty-six (46) years of age or older, is disabled (severity not required) and registered with the Commission for the Rights of Persons with Disability, cannot have capital exceeding €230,000.
When calculating the capital criteria for the means test, a number of things are taken into consideration such as the value of any immovable property belonging fully to the person claiming tenancy, money deposited in a bank which can be withdrawn at less than 3 months’ notice, cash in hand, time deposits, bonds, stocks, securities and any other financial instruments or financial products.
Where several persons have a claim to the tenancy in solidum. In accordance with the previously described Article 1531F of the Civil Code, it is enough for one person satisfies the income and capital conditions of the means test.
Where the means test of only one claimant has been affected or where several claimants have been tested but only one has successfully met the means test criteria or where several claimants have successfully met the means test and have all died or do not qualify as tenants any longer, then when and each time that the last person who satisfied the income and capital criteria of the means test ceases to be a tenant, the means test shall be carried out afresh in respect of the other persons holding the tenancy in solidum and for such purposes the ‘relevant period’ shall be calculated with reference to the date when the said person ceased to be a tenant.
Additionally, one may find a situation where a landlord and the person claiming continuation of tenancy do not agree that the person meets the Means Test Criteria. In such a case, the party may file an application to the Rent Board within 18 months of the tenant’s death and demand the Rent Board to carry the test out itself. Such test shall be carried out by the Rent Board behind closed doors and the recordings of such proceedings may only be accessible to the concerned parties. Any person who divulges information in breach of this regulation shall be guilty of contempt of the Rent Board. Such means test can only be carried out once subject to certain situations such as in relation to a procedural right or in respect to Regulation 8.
The person bringing the claim is bound to present and substantiate a statement and authenticated documentation of his or her income and capital of a period of five years immediately preceding the relevant period so that the Rent Board may investigate whether the person has divested himself of an capital or income without proper explanation. If the Rent Board finds that the person has divested himself, it may decide to consider the capital or income which has been divested and include it in the computation of capital and income of the said person.
This shall not be construed to be as advice but shall merely serve as a brief description of the rights and duties of the Owner. If you would like to discuss this further please do not hesitate to contact us on [email protected] .