Codification of the waiver of rights in Book 1

and Book 5

Article 1.12 (Book 1) of the new Civil Code confirms the principles governing a waiver of right (renonciation / afstand): “Waiver of right is not presumed. It can only be derived from facts or acts that are not open to any other interpretation.” Waiving rights is a unilateral legal act emanating from one party; in principle it must not be accepted by another. This principle was already established in case law.

Book 5 also confirms the possibility to waive a right. Indeed, article 5.253 of the Civil Code provides that the creditor of a debt can, by his mere will, waive his rights to claim (droits de créance / vorderingsrechten). (The creditor may, by his own will, waive his right to claim. Waiver is not presumed.)

Of course, one can only waive his rights in case it is allowed to waive the underlying right. For example, if the underlying right is of mandatory law (droit impératif / dwingend recht) in favor of its holder, the holder can only waive the right as soon as the right exists, but not in advance.

Book 1 and Book 5 change little or nothing to the existing principles on waiver of rights.

A waiver of right:

  • is a unilateral legal act (the creditor alone decides, the debtor does not have to accept);
  • is not presumed (it must be clear that this is the creditor’s intention - which does not necessarily mean that it has to be recorded in writing, but advisable for legal certainty purposes);
  • must be interpreted restrictively: the creditor must waive his right in a clear manner and that waiver is then limited to that.

But what about the specific regime of waiving rights in rem and waiving termination rights under the Retail Lease Act?

Specific regime of waiver of rights in rem in Book 3

Book 3 of the new Civil Code entered into force on 1 September 2021. Book 3 contains, amongst others, new rules on rights in rem (droits réels d’usage / zakelijke gebruiksrechten).

What rules apply in case the holder of a right in rem waives such right?

Book 3 provides that the waiver of a right in rem is a general ground for termination of this right. To be enforceable towards third parties acting in good faith with a competing right on the immoveable property concerned, such a waiver must be notarized and transcribed at the competent Office for Legal Certainty.

However, the waiver of a right in rem has only relative effect. This means that the termination of a right in rem as a result of a waiver cannot affect the rights of third parties acquired in good faith to the cancelled right in rem. Moreover, Book 3 makes it clear that the waiver of a right in rem only operates for the future: if the right in rem was granted for a consideration, the waiver does not affect the holder’s present and future obligation to pay such consideration.

Consequently, a distinction must be made between:

  • the obligation(s) that constitute(s) the consideration of the granting of the right in rem (e.g., the payment of a yearly fee): for these obligations, the holder remains responsible, both for the present and the future;
  • the other obligations resulting from the right in rem (e.g., the obligation to repair): for these obligations, the holder of the right in rem is released from his future obligations.

Let us briefly explain the above rules using the following example:

X grants a long-term lease right (erfpacht / emphytéose) on an office building, on and with land, to Y for a period of 60 years. Subsequently, Y mortgages his long-term lease right to the benefit of Z. After year 20, Y unilaterally waives his long-term lease right. This is possible as the waiver occurs after the expiry of the minimum term of 15 years. However, such waiver shall only have relative effect and the mortgage granted to Z shall continue to exist. In addition, if the long-term lease right was granted for a consideration, the fact that Y waives his right, and the long-term lease right consequently ends, will not result in the release of Y’s obligation to pay the consideration to X until the ‘normal’ termination date of the long-term lease right.

Specific regime of waiver of termination rights under the Retail Lease Act

Under the Retail Lease Act, the tenant is entitled to terminate the lease at the end of each 3-year period, by giving notice by registered letter or by bailiff’s writ, no later than 6 months prior to the end of the 3-year period. This tenant’s break option is of mandatory law (de droit impératif / van dwingend recht), in favour of the tenant. Consequently, the tenant is entitled to exercise his break option at the end of each 3-year period, even if the lease agreement does not explicitly mention it and even if the lease agreement would exclude this right.  

Considering the above and in view of the Covid-19 commercial lease discussions, the question arises to which extent the tenant can waive his break option in advance and what are the risks for both parties.

As set out above, it is only possible to waive a right in case it is allowed to waive the underlying right. If the underlying right is of mandatory law in favor of its holder, the holder can only waive his right as soon as the right exists, but not in advance.

Consequently, the question is: when does the tenant’s break option right exist? In our view, one can refer to the Supreme Court’s case law concerning the tenant’s right to request a renewal of the commercial lease, which must be exercised between the 18th and 15th month before the termination of the lease. This provision of the Retail Lease Act is of mandatory law in favor of the landlord. The Supreme Court has ruled that the landlord cannot waive the benefit of this protection before the 18th month prior to the termination of the lease. It should be concluded that the right of the landlord exists as from the 18th month prior to the termination of the lease (and until the end of the 15th month) and that during this period the landlord can validly waive its right.

In our view, the same reasoning should apply concerning the tenant’s break option: the tenant is protected, and can validly exercise his break option, for a period starting after the execution of the lease agreement and ending 6 months before the end of each 3-year period. During this period, the tenant should be able to validly waive his right to request the termination of the lease agreement. Indeed, arguing that a tenant can only waive his break option just after the period during which it can exercise it (i.e., after 2 years and 6 months), would be a denial of the possibility of a waiver since, at that moment, the right to break does not exist anymore.

This however assumes that the waiver is unilateral, and thus not subject to any agreement between parties, and is not anticipated, i.e., the tenant’s right to break must exist. Therefore, the waiver can only be valid for the current 3-year period (and not for subsequent tenant’s break). There is however no case law on this subject.

Taking into account the above, there is a risk in relation to the waiver of the tenant’s break: in case the tenant can demonstrate that the unilateral waiver of the tenant’s break option was in fact part of a global agreement between parties (e.g., in return for a specific rent-free period or other tenant’s incentives). In such a case, we believe the waiver could be considered null and void, as not being a unilateral voluntary act but a contractual derogation to the tenant’s mandatory break option.