Movable Property Rental Agreement

Movable property rental agreement – a professional template in Word format

A movable property rental agreement is concluded where a thing is given for use against payment – construction tools and machinery, catering or audio equipment, a trailer, a vessel, event equipment. Unlike a loan for use, here rent is paid, so it is important to agree in advance who bears the cost of maintenance, what happens in the event of a breakdown and how late return is dealt with.

The rental of movable property is governed by the Obligations Act (Zakon o obveznim odnosima). The template runs to 9 articles and covers the whole rental cycle – from the description of the thing and its condition on handover, through the rent and the deposit, to the return and the charge for late return. It is used both for occasional hire between private individuals and for regular hire by a sole trader or a company.

Key features

• A professional template – 9 articles drawn up in line with the provisions of the Obligations Act (Zakon o obveznim odnosima) on rental and lease.
• Practical reliability – it separates routine maintenance from breakdowns caused by wear and tear and governs liability for damage, loss and late return.
• Easy customisation – rent per day, week or month, rental for a fixed or an indefinite term, and a deposit as an option.
• Digital delivery – the DOCX file with instructions arrives by e-mail immediately after purchase, ready to print and sign.

What the template covers

• The details of the landlord and the tenant (name or business name, OIB (personal identification number), address or registered office) for both natural and legal persons
• A description of the thing – type, make, model and version, serial number and condition on handover, with the option of a handover record and photographs forming an integral part of the agreement
• The purpose and manner of use, the duty to act with the care of a prudent manager and the ban on subletting without written consent
• The rent per day, week or month, with a choice of payment deadline and method
• A provision on the deposit as security for damage, loss or unpaid rent, with the deadline and conditions for its return
• The duration of the rental – a fixed-term variant and an indefinite-term variant with a notice period
• The division of maintenance – routine care and consumables on the tenant, breakdowns caused by ordinary wear and tear on the landlord
• The tenant’s liability for damage to, destruction of and loss of the thing from collection until return, excluding ordinary use
• The deadline, place and condition of the thing on return and the charge for each day of delay, without prejudice to the right to further damages
• Completion instructions – documenting the condition, the amount of the deposit, insurance of the equipment and the tax position where hire is carried on as a business

Legal framework

A movable property rental agreement is governed by the Obligations Act (Zakon o obveznim odnosima) and no special form or notarial certification is prescribed for its validity. The key difference from a loan for use is the payment – as soon as rent is paid it is a rental and not a loan for use. Where the rental is for an indefinite term, always enter a notice period, because without one it is not clear when the rental ends. Set the charge for late return at a reasonable level, for example the amount of the daily rent or a little more, since an excessive charge can be challenged in law.

Are you handing the equipment over free of charge? Then the right document is a loan for use agreement, because a loan for use is by definition concluded without payment. If you are selling the equipment, use a movable property sale agreement.