GREECE Law and Practice Contributed by: Nikolaos Koulocheris, Ioannis Charalampopoulos, Rozita Karasso and Dimitra Kotsovelou, Machas & Partners
6.22 Termination by a Third Party In Greece, a commercial lease can be terminat - ed by third parties, such as the government or municipal authorities, in cases of expropriation or public interest projects. Expropriation requires a formal decree and compensation to the land - lord, with the process taking months or years if contested. Zoning changes do not affect exist - ing leases. Compensation is typically paid to the landlord, while tenants may claim relocation costs or damages if provided by law or contract. The lease agreement may include specific terms on compensation and early termination in such cases. 6.23 Remedies/Damages for Breach If a tenant breaches a commercial lease, the landlord may claim unpaid rent, eviction and damages. Under Greek law, damages are not unlimited; the landlord can recover actual losses, including lost rent for the remaining term, pro - vided that they take reasonable steps to mitigate losses. Penalty clauses for early termination are enforceable if agreed in the lease. Landlords typically hold security deposits, usu - ally equal to one to three months’ rent, in cash or bank guarantee (letter of credit). The deposit is returned upon lease expiry if no outstanding obligations exist. 7. Construction 7.1 Common Structures Used to Price Construction Projects The most common pricing structures for con - struction projects are fixed price (lump sum), cost-plus and unit-price contracts. Fixed price arrangements provide certainty, as the con - tractor delivers the project at an agreed-upon price regardless of actual costs. Cost-plus con -
tracts reimburse the contractor for actual costs incurred, plus an agreed margin, offering flexibil - ity but limited predictability. Unit-price structures establish fixed rates per unit of work, combining elements of certainty and flexibility, especially for projects where exact quantities are uncer - tain. The choice depends largely on the project’s complexity, scope clarity, risk allocation prefer - ences and the level of control desired by the par - ties involved. 7.2 Assigning Responsibility for the Design and Construction of a Project Common methods include Design-Bid-Build, Design-Build and Construction Management models. In Design-Bid-Build, responsibility rests fully with the owner’s architects or engineers, with contractors responsible only for execution. Design-Build assigns both design and con - struction duties to a single entity, streamlining accountability, reducing disputes and enhanc - ing efficiency. The Construction Management method separates design and construction but involves a construction manager co-ordinating early on, offering greater flexibility and control to the owner. Allocation of responsibilities depends on project complexity, timelines, cost predict - ability and the owner’s expertise, balancing risk management with clear accountability. 7.3 Management of Construction Risk Key contractual devices used to manage con - struction risk include indemnification clauses, warranties, limitation of liability provisions, and waivers of consequential damages. Indemnifica - tions allocate responsibility by obligating parties to compensate for specified losses. Warranties ensure work quality and performance standards. Limitations of liability cap potential exposure, providing predictability, while waivers exclude recovery for certain indirect damages. However, these provisions are subject to legal constraints,
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