- The hotel agreement
The lease concerning rooms of a hotel is to be taking place:
- Either directly from the clients themselves acting as such.
- Or through travel agents/ companies that make sure they get them promoted to tourists-clients, in such a way that it works as a “wholesale lease” that it could further escalate into two different and separate forms depending on the specifics of the law, the details of the agreement between the parties, and even the way they have gotten used in doing business (there’ s the option of choosing other ways of coming to an agreement or combining some of them, always within the framework of the freedom of transactions), in particular:
- The booked or guaranteed reservation, in a way that the hotelier undertakes the responsibility to lease certain number of beds (while also offering relevant hotel services) for a specific period of time to the third parties-clients of his/hers as designated by his/ her contracting party. The contracting party as such has to deposit the whole of the agreed fee regardless of whether the leased beds had been used by way of use by the end users-clients, or not.
- The allotment reservation by way of shares, as regulated by article 11 of the decision of the Secretary General of the National Tourism Organization [in Greek E.O.T] 5030807/29.1.1976, to which according to article 8 of the Greek Law 1652/1986 it has been given the authority of a proper valid law. In such a case it is to set in advance the arrangement of two far-reaching number of beds, a minimum and a maximum one for a specific period of time, or for specific periods of time. The hotelier is obliged to reserve for his/ her counter contracting party a maximum number of beds, whereas the hotelier is also obliged to compensate his/ her counter contracting party if he/ she fails to do so, while the lessee of the beds is obliged to pay the fee only for those particular beds he/ she actually made use of and not of the rest of them which he/she has not made use of (Supreme Court-Areios Pagos dec. Nr. 1207/2001 Nomos, Athens Court of Appeal dec. nr. 4174/2010 Greek Justice 2011, 1076, Dodecanese Court of Appeal dec. nr. 122/2007 Nomos). Therefore this specific agreement is of mixed features basically a lease one in essence, while also entailing terms of services’ lease, sales, commission, other than those of a hotel lease which is a lease of a profitable object and falls under the protective legislation of professional-commercial leases, thus under the procedure described in articles 647-662Θ of the Greek Code of Civil Procedure (Athens Court of Appeal dec. nr. 4174/2010, Dodecanese Court of Appeal dec. nr. 122/2007). In terms of hotel agreement, the lease of the real estate is of, financially speaking, foremost importance while it is considered to be the fundamental one in essence, whereas the rest of the terms described in other types of agreements, are not considered to be of such importance in terms of the hotel agreement, while regardless of their cost, they are not to be estimated without being part of the lease agreement. Therefore, the fundamental lease character of the hotel agreement, according to the theory of merger, leads inevitably to the application of articles 574 et al of the Greek Civil Code, and to the hearing of main or supporting differences stemming from the lease agreement as such according to the provisions of articles 647-662Θ of the Greek Code of Civil Procedure, and before the Single-Member Court of First Instance or the Magistrate Court, depending each time on the agreed lease fee (Athens Court of Appeal 4174/2010, Dodecanese Court of Appeal 122/2007).
- The outbreaks of Corona virus in Greece on 003.2020, the consequences and the measures introduced by the Greek Government
While the current overview was prepared in Greece, by 09.03.2020, almost 89 cases of corona virus incidents had been verified, while the losses of the Stock Market of Athens had been more than 35% from the beginning of the year, resulting to Greek banking institutions being currently perhaps the main victims of the corona virus internationally.
The Greek Government has announced further restrictive measures in order to protect those groups of people described as vulnerable, and in particular:
- The suspension of operation of the Centers Widely Providing Protection to all Aged People (in Greek “KAPI”) for 4 weeks’ time.
- The suspension of all conference meetings within Greek soil for 4 weeks’ time.
- The suspension of all school recreation tours within Greek soil for 2 weeks’ time.
- Carrying out all sports events behind closed doors within Greek soil for 2 weeks’ time.
- With regards to schooling units of any level, there has been decided the pre-emptive suspension of all schooling units regardless of age of all country.
In addition, as of March 09, 2020 there shall be taking place a joint information update by Ministries of Finance, Growth and Investments, Labor and Social Affairs with regards to the first set of financial measures to deal with the repercussions stemming from the coronavirus spread, and which shall be about certain specified measures aimed towards corporations that have been obliged to suspend their operation after having received a particular mandate by the State itself, in other words they are to fall under the decisions of restrictive measures of protection aimed towards the outbreaks of coronavirus, i.e. for corporations that seem to be active in the three prefectures that have been affected by the corona virus outbreaks – namely the prefectures of Achaia, Ileia and Zakynthos, while at the same time new interventions have been scheduled in order to have suspended the tax (for instance, VAT payment) and the insurance obligations of the said corporations.
Even more so, pursuant to the circular issued by the Ministry of Health in Greece it is underlined that there is an urgent need of proceeding with measures restricting the spread of the corona virus at the premises of swimming pools.
- Reservation cancels at hotels within Greece due to the coronavirus situation – returning payments in advance due to force majeure
Should money paid in advance being returned or not to clients from the hotels, in all these cases of force majeure, especially when the clients decide not to go these hotels due to an unexpected event?
The agreement between the hotelier and the client with regards to the provision of hotel services is an agreement working both ways and which is to be prepared either in writing or by someone paying in advance on behalf of the client to the hotelier part of the whole price of all nights reserved according to their agreement. Due to that agreement the client is allowed and obliges at the same time to make use of that specific leased real estate until the expiry date of the agreement at hand. If there is not any in place, that very client shall have to compensate the hotelier.
When the client accepts the provision of services offered by the hotelier, given of course that the services are promptly provided, then that certain acceptance shall be constituting obligation as well. This also means that the client who does not accept the offered services is not just an overdue debtor but even more so he/ she is obliged to compensate the creditor-hotelier by taking in to consideration as well the down payment he/ she has already paid in advance.
However the client is not considered overdue and thus no compensation is to be paid αποζημίωση (therefore the down payment should be returned intact as a whole) if the denial to accept the offered services is based on reasons of force majeure.
According to the prevailing point of view, force majeure is about an incident unpredictable and inevitable, even if someone has taken the most particular measures of wisdom and care. Such an incident is that of the outbreak of corona virus, due to the fact that it does not merely constitute an impediment of the sort that does not allow for the acceptance of the properly offered services by the hotelier, but it is also proven beyond any doubt thanks to unequivocal incidents or established evidence that because of the coroana virus outbreak there have surfaced such circumstances in Greece that fall under the definition of force majeure and definitely argue in favor of the release of the lessee-client form the exact fulfiment of his/ hers contractual obligations, therefore the hotelier is obliged to return imeediately the downpayment previously paid. The burden of proof of such a claim stays with the client who has to present it in the form of statement of termination of the agreement at hand according to articles 588 and 596 of the Greek Civil Code.
If Greece in its totality or parts of Greece are to be considered under conditions of urgent need due to the coronavirus outbreak, then this shall be constituting undoubted evidence of force majeure.
This does not mean however that if there has not been declared a state of urgent need , that the clients of the hotels that have not checked in at the time they were supposed to – exactly due to the corona virus outbreak – or, they have not remained in their resorts until the time of proper check-out, that they shall not be invoking the argumentation of force majeure. The only repercussion they might experience is that they now bear the proof of burden of their claim, according to the evidence brought forward and estimated on a case-by-case basis (e.g. evaluation of problems, number of incident, predictions on further incidents to be expected, spread of the virus within the Greek State as a whole etc.). it goes without saying that all the evidence shall be estimated only if the time frame of the 21 days prior to check in time has been sustained, a time frame after which the client cannot leave without any compensation.
Therefore the hoteliers obligation to return all down payments concluded by the clients in case the latter did not arrive at all at the specific check in time, or they did not stay in their resort until the final day of their proper checkout, by invoking the corona virus outbreak as force majeure, does not necessarily mean that the certain area of interest has been declared under a state of urgent need.
Should the matter is of your concern, please do not hesitate to contact our Law Firm.