Municipality cancels entrepreneur’s rent. Now what?
A number of businesses rented property at a municipal industrial site. The municipality cancelled all the rental contracts because it had a different zoning plan in mind.
Three entrepreneurs came to Hoens & Souren for advice and support. We were tasked with finding a solution which would guarantee the continuity of the businesses as much as possible.
We first advised them to create a position by appealing against the termination of the rental contracts. Because the case concerned the rental of undeveloped land, developed by the entrepreneurs, we knew that our clients’ position was difficult. Partly for this reason, we simultaneously appealed against the intended change of the zoning plan for the industrial site. In this case, the Council of State rejected the modifications to the zoning plan for the plots in question. We put forward this ruling in the legal procedure brought by the municipality to terminate the rental contract and vacate the premises.
The sub district court found the verdict of the Council of State to be of importance and rejected the municipality’s claim. The municipality appealed against this verdict. This was the moment to enter into discussion with the municipality.
We achieved a quick solution for the clients. They were able to buy a piece of land on another industrial site for a very agreeable price and the municipality contributed a substantial sum for the relocation of the business.
The second client opted for a longer process. We agreed upon relocation of the business, where our client would be reimbursed on the basis of an expropriation procedure. We turned over the case to a specialist in this field. Years later, the client was able to reopen his business in a beautiful new location. He was able to acquire the land for a ‘nice’ price from the municipality and received a substantial compensation for the relocation costs. He did not have to pay any rent for all the years he spent at the old location.
And the third client? They decided at an early stage to no longer make use of our services. They may have come to regret this.
Any questions? Please contact Mykel Beekman.