On September 21, 2021 the Italian Senate has approved the draft of the delegation law on the reform of the Italian civil procedural code (CPC).
The delegation law shall be now approved by the House of Representatives, to whom the draft has been submitted on October 5, 2021.
Probably the reform will be adopted, so it could be interesting to anticipate two of the most relevant modifications of the CPC:
- the mandatory mediation is applicable also for cases related to franchising;
- the summary proceeding normally applied to lease contracts is also applicable to rent of business contracts.
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Probably because franchising is now considered by the Parliament a contract where a party (franchisee) is formally weaker than the other party (franchisor), it has been included in the list of contracts where mediation is mandatory.
When mediation is mandatory, a mediation proceeding must be started before filing a judicial proceeding.
The mediation proceeding takes about 1-3 months and it – evidently - delays the timing for starting a judicial proceeding and consequently the issuing of a possible judgment.
However, if the parties enter into a settlement agreement during the mediation proceeding, they may resolve the dispute in short time and without waiting for the judgment that normally is issued in 2-3 years after the filing of the claim.
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The other relevant proposal of modification to the CPC relates to business leases.
Our CPC sets forth an expedite proceeding aimed at evicting the tenant which is in breach of its payment obligation (sfratto per morosità). Such summary proceeding is sensibly shorter than the ordinary proceeding and may grant the landlord an interim declaration of termination of the lease as well as an interim injunction for the payment of the rent.
Currently, this proceeding is only applicable to property leases. When it comes to business leases, , the landlord cannot take advantage of the above expedite proceeding, andis only entitled to start an ordinary proceeding recover the unpaid rent and/or to terminate the lease for breach.
The proposed modification of the CPC extends the application of the sfratto per morosità to business leases, which would sensibly favor landlords in business lease agreements.
Property leases and business leases contracts and rent of business contract, with such modification of the CPC, become very similar from a remedy perspective and therefore, the parties decision on the type of contract to be chosen for a specific deal will need to be evaluated also on the basis of the effects of the new law.