3 Things Tenants Should Know If the Landlord Passes Away

Does the lease agreement terminate if the lessor dies? While no one wishes for this situation to occur, a tenant needs to know how to handle it should it arise. Does the existing lease agreement become void?

3 Things Tenants Should Know If the Lessor Dies

1. Does the lease agreement terminate if the lessor dies?

To answer the question of whether the lease terminates upon the lessor's death: the answer is no, it does not terminate.

Generally, the lease agreement does not automatically end when the lessor dies; instead, it passes on to the lessor's heirs or beneficiaries. These heirs are obligated to assume the rights and duties under the original lease agreement until its term expires, unless the lease agreement specifies otherwise.

Therefore, the tenant may continue the lease by paying rent to the heirs until the contract term concludes.

However, if the lessor has no heirs via a will or no statutory heirs, Section 1753 of the Civil and Commercial Code applies. It states that—subject to the rights of the estate's creditors—if a person dies without statutory heirs, testamentary beneficiaries, or a foundation established by will, that person's estate escheats to the State.

In such cases, the Ministry of Finance assumes responsibility for the property that has escheated to the State. If the lease remains active while the Ministry of Finance has not yet taken over administration, the tenant must deposit the rent at the Deposit Office (Legal Execution Department) or the Provincial Legal Execution Office. Once the Ministry of Finance has claimed the estate, the tenant should pay the rent to the Ministry instead, continuing until the lease expires.

___________________________________________

2. The New Lessor No Right to Evict the Tenant

You likely already have the answer to whether the lease terminates upon the lessor's death. However, the next important point for the tenant to understand is whether the heir or beneficiary—who steps in as the new "lessor"—has the right to evict them.

When the lessor passes away, the lease agreement and the rights and obligations associated with the lessor role are passed on as inheritance to the lessor's heirs, who then become the new lessors. While the new lessor has the full right to manage the leased property, they do not have the authority to evict the tenant.

However, if the tenant breaches the lease agreement, the Notification of the Contract Committee regarding "Residential Building Rental Business as a Contract-Controlled Business (B.E. 2568)" stipulates that the lessor must provide a written notice requiring the tenant to rectify the issue within 30 days before the lease can be terminated. An exception applies if the tenant's actions directly disrupt the peaceful coexistence of other tenants; in such cases, a written notice must be given at least 7 days in advance.

___________________________________________

3. The Lessor Cannot Change the Rent Before the Lease Ends

Even if there is a change in lessor, the rent cannot be altered while the lease is still in effect. The Notification of the Contract Committee regarding "Residential Building Rental Business as a Contract-Controlled Business (B.E. 2568)" prohibits changing rental rates, utility rates, or service charges before the lease expires. It also prohibits charging water and electricity fees at rates higher than those actually billed by the relevant authorities.

___________________________________________

Key Information About Lease Agreements

In addition to the question of whether the lease terminates upon the lessor's death, there are other points tenants should be aware of... The lease agreement is a crucial matter that tenants should not overlook; in the event of a dispute, the contract serves as a safeguard, enabling tenants to pursue legal action and claim their rights under the law.

Under Section 540 of the Civil and Commercial Code, real estate lease agreements in Thailand are limited to a maximum term of 30 years. Any period exceeding this limit is considered void; however, the lease can be renewed for subsequent terms of up to 30 years each.

Additionally, lease agreements exceeding three years must be registered with the Department of Lands to be legally valid.

___________________________________________

Thanks to DD Property for this useful information.