Explanation of Article 426
The article addresses the effect of the warranty for defects in the leased property, and there is no difference in general between the effect of the warranty for defects and the effect of not carrying out the necessary repairs as stated in Article (419); in both cases, the lessor's liability arises for not delivering the leased property in a condition fit for the intended use throughout the lease period. However, the defect there is due to the age of the leased property and the lack of necessary repairs, while the defect here is due to a flaw in it, not because of neglecting necessary repairs.
The article stipulates that the lessee, upon discovering a defect in the leased property that the lessor is responsible for according to Article (425), may choose to request a reduction in rent proportional to the decrease in benefit due to the defect, which is execution by compensation. Once a reduction in rent is ruled, it is reduced not only from the time of the claim but from the time the decrease in benefit occurred. Once the lessor repairs the defect, the rent returns to its original state. The lessee may also choose to request the termination of the contract, and the general rules apply to the request for termination; the court may reject the request for termination if the decrease in benefit is not substantial enough to justify termination, and may limit the lessee's right to compensation, applying the general rule of judicial termination stipulated in Article (107). The lessor may also prevent termination if they promptly repair the defect before termination, and the court may grant them time to repair the defect if requested, unless such prevention or delay harms the lessee. The lessee, along with the request for termination, may request a reduction in rent from the time the benefit decreased until termination.
If repairing the defect is possible, the lessee, in addition to their right to request a reduction in rent or termination, may compel the lessor to repair it, as the lessor's obligation to warrant defects is like their obligation to carry out necessary repairs; both stem from their obligation to deliver the leased property in a condition fit for the intended use throughout the lease period. According to the general rule stipulated in paragraph (1) of Article (164), the creditor may compel the debtor, after warning them, to perform their obligation in kind if possible. Execution is according to the general rule of specific performance stipulated in paragraph (1) of Article (167). What Article (419) stipulates regarding the lessor's obligation for necessary repairs; the lessee may request court permission to repair the defect at the lessor's expense, and in urgent cases, repair it at the debtor's expense without court permission. However, if repairing the defect is excessively costly and disproportionate to the rent, the lessee cannot compel the lessor to do so, and the court limits their right to execution by compensation, applying paragraph (2) of Article (167), which states: (If specific performance is burdensome for the debtor, the court may, at their request, limit the creditor's right to compensation if it does not cause them substantial harm).
In all previous options, whether the lessee chooses specific performance, rent reduction, or termination, they have the right to request compensation for the damage caused by the lessor's breach of their obligation to ensure the leased property is free from hidden defects. Since the lease contract is considered a contract of exchange based on the leased property's freedom from hidden defects, the lessee, in case of requesting specific performance or termination, may request a reduction in rent proportional to the decrease in benefit until the defect is repaired or termination occurs. They may also request compensation for any personal or property damage caused by the defect, whether they choose specific performance, rent reduction, or termination.
Related To
Article 426
If the defect fully or partially prevents the lessee’s use and enjoyment of the leased thing, the lessee may demand termination of the lease or reduction of the rent, without prejudice to his right to compensation.