Three lawyers gave details on the possible consequences of the Luxembourg café owner's rent case.
Photo: Matic Zorman
The lawyer who represented a café manager who received a rent refund for the period his café was closed, is preparing an appeal in case the landlords contest the decision. Could other players in the horeca industry follow?
One month after the court ruled in favour of a café on the banks of Clausen whose landlord, the Brasserie de Luxembourg, was claiming rent during the period of “strict administrative closures”, the case is not closed. It will now go to appeal, confirms Frank Rollinger, the lawyer in charge of the case.
Two problems remain, according to him: “It was retained that, during the moments of opening, it is necessary to pay the entirety of the rent.” However, “the contract was made according to a certain number of available places. If only a third of the people can be admitted [due to health measures, editor’s note], the parameters have changed. The judges say it’s the vagaries of the trade, but I don't agree.”
The second aspect concerns the breach of contract, decided by the Brasserie de Luxembourg, which was no longer receiving its monthly payments. This is accompanied by a “re-renting indemnity”, equivalent to six months’ rent, still to be paid by the café owner.
A stop for the spring?
The Brasserie de Luxembourg has still not communicated its decision to appeal or not. “Maybe they are trying to leave it at first instance and then say that it is only a decision of first instance.” thus having less weight, suggests Rollinger, who says he is surprised, even if they still have “a few more days until the appeal deadline.”
In any case, the lawyer is counting on a final decision for April or May. If, after that, “they maintain that the rents are due” for the period when the café could open, but staffing was reduced, “they will have to act in liability, simply against the state.” The lawyer who advises the association “Don't forget us”, considers that the latest aid is insufficient, since it should have been retroactive. On Monday, 1 March, he issued a detailed press release on the subject.
If most of the cafés are rented out by the two big breweries of the country, these are also tenants, for the most part of M Immobilier, explains the lawyer. The landlord could therefore also turn against the owner, he believes.
A decision that could set a precedent
Could there be other similar judgments that would set a precedent? Rollinger has studied the subject with lawyers Joël Marques and Olivier Wies. “A first judgment could set a precedent,” explains Marques. “But it will not have any force as such.” The lawyers therefore advise café owners to wait for the appeal, even if they can already take advice on whether the judgment could apply to their case or not. And to continue paying their rent.
“You have to be aware that some breweries have been busy since the first judgment,” says Rollinger. “By making small gifts, it will discourage some people from coming forward,” warns Marques.
The café owners are not the only ones concerned. Rollinger believes that his reasoning also applies to businesses and other members of the hotel and catering industry. His main argument is linked to the contract between the operator and the landlord, which clearly states that it is either a pub, a restaurant or a discotheque. “When the building is automatically closed by law, you can't do anything else,” he says. The take-away or “click and collect” could not, according to him, be taken into consideration by the judge.
Class action not an option
Several actors have turned to lawyers since the decision of 25 January. The problem: it is impossible to introduce a class action in the grand duchy. This was a problem during Dieselgate scandal. “There is a bill which was deposited, but that relates only to the right of consumption,” explains Wies. “We really need to change something, to open it to businesses.”
Today, each person must introduce an individual request, with his own lawyer, to obtain a single judgment. Marques says he has been in contact with a dozen DJs since the beginning of the pandemic, who would surely have started proceedings if they had been able to get together to divide the costs, often “in four figures.” Wies also points out this could “decongest the courts.”
The café owners could thus join forces against their landlords, or even the state. But the implementation of such a process should not see the light of day for a few years, say the lawyers. It will therefore apply to other cases.
This article was originally published in French on Paperjam.lu. It has been translated and edited for Delano.