Head of real estate and commercial law practice
Specialist in the field of commercial law and process. Real estate, construction support; land law and protection of property ownership.
Agreement on the transfer of property for temporary use
Quite often, in the interaction of various economic entities, the issue of regulating relations regarding the temporary use of property arises. For this, according to current national legislation, there are various legal mechanisms, in particular, contracts for the paid or free use of property (without the loss of ownership rights to it by the relevant person). We will talk about different types of such contracts and their features and essential conditions in this article.
What is a contract for the transfer of property for temporary (paid and free) use?
A contract for the transfer of property for temporary use is a legal agreement under which one party (the Owner) transfers to the other party (the User) the right to temporarily use individual property. Its main conditions are:
- temporary (upon expiration of the term, the property in its usual condition is transferred to the owner);
- preservation of ownership rights by the counterparty (the owner retains the right to possess and dispose of the property).
What property can be transferred for temporary use under a contract?
According to the law, any property that meets two main criteria can be transferred for temporary use – individually defined (it can be distinguished from other property of the same type) and non-consumable (does not lose its original properties during use). Therefore, the property under the analyzed contract can be housing, land plots, vehicles, equipment, etc.
What are the types of agreements on the transfer of property for temporary use?
Loans
According to Article 827 of the Civil Code of Ukraine, a loan agreement is an agreement under which one party transfers a certain thing to another for free use for a specified period. The key difference between this agreement and others is the absence of any payment to the owner of the property, respectively. However, in addition to this, it is also characterized by the following features:
- parties – the lender and the user;
- form – mainly written, but can be concluded orally (for household items);
- notarial certification – not required, with the exception of vehicle loan agreements;
- the lender’s right – to demand early termination of the agreement if the thing has become necessary to him due to unforeseen circumstances.
Lease
A residential real estate lease agreement in accordance with Article 759 of the Civil Code of Ukraine is an agreement under which the owner of the dwelling transfers it to another party for residence for a certain period for a rent. It is perhaps the most common in the life of citizens. Given its functional purpose and individual requirements expressed in the law, such an agreement is characterized by the following features:
- the subject may be an apartment, a residential building or its part, suitable for residence;
- the use of housing for one’s own needs is always paid and involves the payment of rent monthly (mostly);
- is always concluded in writing;
- the tenant has a preferential right to conclude a contract for a new term if the old one has expired, as well as to redeem the apartment or house.
Leasing (of transport or equipment)
Finally, the leasing agreement, which is the most common in the interaction of various business entities, is a specific type of agreement according to Article 806 of the Civil Code of Ukraine. In accordance with the above agreements, the lessor transfers property to the lessee for temporary possession and use for the corresponding leasing payments. Below are the essential terms of such an agreement:
- first, the subject of the agreement is any individually defined property that meets the criteria for fixed assets (for example, production equipment, transport, special equipment, etc.);
- second, the risk of (accidental) destruction or damage is usually borne by the lessee, unless otherwise stipulated by agreements between the parties;
- third, the procedure for paying for the use of the property – the lessee must reimburse the lessor for the amounts of payments for the entire period of actual use (in the absence of such use – to prove this to the counterparty in writing).
Legal support for the development of contracts for the transfer of property for use: what services does a specialist at the Law Firm “Prikhodko & Partners” offer?
The services of a lawyer for the development of contracts are critically important for the protection of your rights. The specialists of the law firm “Prikhodko & Partners” offer a comprehensive approach to resolving any issue related to the conclusion of a housing rental, loan or leasing agreement. Their main services are:
- legal consultations;
- legal audit of the agreement proposed for signing;
- professional development of a new agreement (between legal entities and individuals, respectively);
- conducting negotiations between the parties and agreeing on the text of the agreements;
- drawing up annexes and additional agreements to the main agreement (for example, on the replacement of a party, early termination, etc.);
- legal support for the signing and notarization of the agreement.
Would you like to know the cost of developing a contract for the transfer of property for temporary use in your case? Then get an introductory consultation from a lawyer by filling out the form below.
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