The Supreme Court of Cassation recently examined the relationship between real estate leasing agreements and mandatory mediation in banking and finance agreements.(1)

Facts

The case originates from a proceeding regarding the release of property. The claimant, on behalf of a credit institution, commenced a legal proceeding asking for the termination of a finance lease agreement for breach of contract in favour of a real estate company.

The tribunal accepted the claimant's request and ordered the release of the property. The defendant appealed the decision and the Court of Appeal confirmed the tribunal's decision. The Court of Appeal decision was appealed before the Court of Cassation by the losing party for three reasons.

In its second appeal, the losing party claimed violation of Article 5 of Legislative Decree 28/2010, as the lease agreement, which had been concluded with a credit institution, should have been correctly qualified as a banking or finance agreement. This would have meant that mandatory mediation should have been attempted, as the finance agreement had been concluded with a credit institution.

Decision

The Supreme Court rejected the appeal, given that the appellant's legal position could not be endorsed. Article 5 of Legislative Decree 28/2010 requires that mandatory mediation should be attempted and specifically refers to banking agreements and not, more generally, to agreements concluded with a credit institution. It also refers to finance agreements and not, more generally, to agreements with financing purposes.

Legislative Decree 28/2010's explanatory report states that the legislature classifies banking agreements or service agreements as 'finance agreements'. Similarly, the explanatory report mentions the conciliatory experiences of Legislative Decree 179/2007 and the proceedings in the implementation of Article 128bis of the Banking and Finance Law ((TUB) Legislative Decree 385/1993).

It is clear that Article 5 of Legislative Decree 28/2010 refers to the discipline of banking agreements contained in the Civil Code or in the TUB, as well as to the agreements relating to financial instruments (Legislative Decree 58/1998, as amended).

According to this regulatory framework, the relevant provisions cannot be extended to cases involving real estate leasing, even if they include finance agreements.

Comment

Article 5 of Legislative Decree 28/2010 provides that mandatory mediation must be attempted in banking and finance agreements.

In Decision 15200/2018, the Court of Cassation stated that the abovementioned rule cannot be applied exhaustively, in particular in real estate leasing cases. This means that in legal proceedings regarding real estate leasing agreements, it is not mandatory to attempt mediation.

This decision was made based on Article 5 of Legislative Decree 28/2010, which provides exceptions given that the general rule is that it is not mandatory to attempt mediation before commencing a legal proceeding; this means that extensive interpretation of the cases listed in the abovementioned provisions is not allowed.

For further information on this topic please contact Costanza Mariconda at Mariconda e Associati Studio Legale by telephone (+39 02 795 212) or email (costanza.mariconda@studiomariconda.com). The Mariconda e Associati Studio Legale website can be accessed at www.studiomariconda.com.

Endnotes

(1) Court of Cassation, 12 June 2018, 15200.

This article was first published by the International Law Office, a premium online legal update service for major companies and law firms worldwide. Register for a free subscription.