High Court Ruling Shakes up Commercial Property Rentals

In a highly anticipated ruling, the High Court has declared sections 22 and 23 of the Commercial Premises (Rent) Regulations 1983 to be unlawful and set them aside. This decision marks a major shift in the world of commercial property rentals, as tenants are no longer protected from eviction once their lease agreements have expired.

Previously, tenants were authorized to continue using premises even if their contracts had ended, thanks to the protections provided by sections 22 and 23 of the regulations. However, High Court Judge Justice Webster Chinamhora declared these provisions to be unfair, stating that they heavily restricted the rights of property owners to terminate occupancy or seek eviction once the lease had expired.

Justice Chinamhora further explained that the regulations created a forced relationship between the tenant and the property owner, known as a statutory tenancy, which unfairly limited the powers of a court to order eviction. The judge also noted that the provisions effectively prevented property owners from increasing rent or leasing the property to someone else once the statutory tenancy protection applied.

This ruling was the result of a legal dispute between Harare-based company Elnour United Engineering Group and Industry and Commerce Minister Sekai Nzenza. Elnour United, which owns Gulf Complex and Sunshine Bazaar in the Harare central business district, as well as Mbare, argued that the regulations went beyond the powers of the Commercial Premises Act.

In a victory for Elnour United, Justice Chinamhora ruled that sections 22 and 23 of the regulations were ultra vires the Commercial Premises (Lease Control) Act. This decision has been met with mixed reactions, as property owners celebrate their newfound freedom to manage their properties as they see fit, while tenants face the prospect of being evicted once their lease agreements have expired with no legal protection.

The commercial property rental industry is now facing a major shakeup, and it remains to be seen how this ruling will impact the market in the coming months and years. However, one thing is clear: the High Court's decision marks a major shift in the balance of power between property owners and tenants.

This ruling is sure to have far-reaching consequences for both property owners and tenants, and we look forward to reporting on how it plays out in the market.