Editorial

Tiago Azevedo Ramalho

The recent changes to the urban lease regime are another factor in the turbulence of the already agitated waters of Lease Law. Certainly, taking to account the last few decades, there will be no good luck for this or any other legislation on this matter. But it is necessary to understand why, in Civil Law, there is such inconstancy.

Perhaps the cause of the volatility does not lie even in Civil Law, or as frequently suggested, in a possible malpractice of the legislator. Perhaps this may happen from time to time, due to the misfortune of some proposed solution - considering, for example, the complexity of transitional regimes. But it does not seem to explain the deep-seated inconstancy, which has been increased by successive attempts to solve it, and to which no one who has to decide seems to be able to escape.

The difficulty of regulating Lease Law arises of the tension between fundamental demands of distributive justice and the possible results of the functioning of a business system based on commutative justice. We will refer to urban leasing for housing purposes, although it is extensible, with the necessary (and not a few) modifications, to the remaining purposes and modalities of the contract.

In fact, even before the legal question of how to regulate the civil urban lease, there is a previous problem, of a public nature, of guaranteeing access to housing. This problem is essentially one of distributive justice. It is intended that, considering all the available goods, they are distributed in such a way that everyone has a house reasonably apt to satisfy their personal and social needs. In any case, from the point of view of distributive justice, the focus is placed not so much on the means, but on the intended distributive result. The means are, therefore, indifferent, in the sense that any one is considered adequate, as long as they are adequate to obtain the intended result.

Quite different is the logic of the civil commutative system, based - among other elements - on the recognition of private positions of sovereignty over certain goods, and on the interaction between different actors according to criteria of freedom and responsibility. We are not interested, here, in the results, but only in the legitimacy of the means. Any result is at least legitimate and protected by law, as long as it is produced with legally compliant means (eg, valid and effective contracts). If, in the end, one ends up with everything, or few with a lot and many with little, or all with about the same - any one of these results is considered indifferent, equally valid, as long as they are obtained in compliance with legitimate means.

A Civil Law based on these principles does not guarantee, however, certain purposes of distributive justice – it may, or not, produce them. Ultimately, Civil Law is determined, not by a single decision, but by an infinite number of small business operations carried out in a free and decentralized way by members of the community. So, the result of all these small business operations cannot be predicted, because it depends only on the personal initiative of those who carry them out. Therefore, a reform of the contractual lease regime to promote a certain result can lead to results fundamentally different from those envisaged in the legislative area, as it can never anticipate in what the legislation does not depend on: the decisions to lease or not to lease, the terms on which to lease, whether or not to terminate the contract, and so on.

Crossing those elements, the strong tension to which the Lease Law is subject is well perceived. Any system in which the guarantee of housing is dependent on the effective functioning of the market is necessarily condemned to be under permanent tension - because the functioning of a commutative justice model, is not deterministically capable of generating the desired output.
The most perfect model, from the point of view of the articulation between distributive justice and commutative justice, would certainly be based on providing, outside the scope of Civil Law, redistributive systems that did not put pressure on the Lease Law to guarantee, or to contribute, to final redistributive regimes - for example, a long-term public lease system. Thus obtained the intended redistributive purposes (in this case, effective access to housing for all), the civil legal system could operate freely.
In the absence of such alternative mechanisms, there is only one possibility: to insert, into Civil Law, rules that seek to guarantee certain redistributive results. This will favour tenants over landlords, because the redistribution, here, means taking freedom from some to offer stability to others. Once the fundamental nucleus of the person's legal position is protected, satisfaction of distributive justice requirements must logically respect commutative justice. If “binding” means only reinforced, qualified, vigorous protection of the tenant, then “binding” does not constitute any atavism, but a possible, though imperfect, answer to the problem of conciliate access to housing with the eventual absence of real alternatives to market leasing. This solution results, therefore, from the incorporation, internalization, of the demands of distributive justice in a commutative justice system.

Knowing the exact measure and operation of guardianship is another task - and the reason for much of the instability of the lease regime. Moreover, as already mentioned, from the point of view of distributive justice the means are indifferent, as long as the intended purpose is satisfied: if, from the distributive point of view, the desired result is obtained in different ways than “binding”, then such solutions can be adopted. But, in the negative case, there is nothing strange, nor unusual, in a particularly robust protection of the tenant, as is evidenced by contemporary German law, a country with a very vigorous rental market, whose highly protective solutions were not widely publicized among us.

But even if there were such redistributive systems that would provide the desired redistributive result in terms of access to housing, special protection of the tenant would always be considered, at least for medium and long-term rentals. If Civil Law is a fundamental right, then it cannot remain indifferent to the growing fragility of the tenant as the execution of the contract is prolonged, to the point of the termination of the lease - with how much it implies reconfiguring the identity of the person, for causing a rupture of their existential living space - to have particularly damaging consequences for the tenant and his/her family. So, it is quite reasonable, even within the strict framework of commutative justice, that the one who makes an asset available to others, which will become of existential importance, should have his/her freedom to recover the good and to replace it (or not) in the market. Obviously, with appropriate counterparts, both in the remuneration for the concession, and in the possibility to energetically demand from the lessee the fulfillment of the wide range of lateral duties that result from the contractual relationship, and to react to violations - requirements also of commutative justice.

The latent tension in the legal lease regime, at the origin of its patent instability at the legislative level, seems to be over. For this reason, but now calmly, let us pay attention to the latter and to the probable new attempts to find a balance between these two demands for distributive and commutative justice, which, although so different in intention, are here forced to come into contact.


[Tiago Azevedo Ramalho is an Invited Assistant Professor at the Faculty of Law of the University of Porto]