Short Answer
Treat physical exit as a project that starts before the legal lease end date.
A lease can require the tenant to remove equipment, dismantle tenant works, reinstate alterations and deliver vacant possession within a short period. If that cannot be completed by handback, the tenant may face holdover charges or damages even though trading has stopped.
Thai Civil and Commercial Code section 561 makes the condition of the leased property at handback important, while section 562 distinguishes tenant-caused loss or damage from deterioration resulting from proper use.
The key is to align four things before expiry:
removal scope → reinstatement standard → access period → financial consequence of late handback
Why This Matters
Closing a site is not the same as returning it. A factory or fitted unit may need weeks to remove equipment, installations and resulting damage.
If vacant possession is due on expiry, time spent doing that work can become disputed holdover. Exposure increases where the lease charges an enhanced amount for each month—or part of a month—and also preserves claims for additional loss.
Typical Scenario
A tenant decides not to renew.
The lease requires the premises to be returned vacant and reinstated on the expiry date.
Operations estimate that safe equipment removal and reinstatement will take three more weeks.
Management asks:
“Can we stop trading on expiry and use the premises afterwards only for removal works without being treated as holding over?”
That should be agreed before expiry, not assumed.
Practical Analysis
01Separate the exit obligations.
Map the separate steps:
business cessation → stock / equipment removal → tenant alterations → reinstatement → cleaning → keys / meter readings → formal handback
A clause requiring “return in good condition” rarely answers all of them.
02Establish the required physical condition.
Section 561 creates a presumption about the condition in which leased property was received if there is no signed condition record and links that baseline to return. Section 562 makes the tenant responsible for loss or damage caused by its fault or persons for whom it is responsible, but not deterioration from proper use.
Entry condition evidence, alteration approvals and the reinstatement standard therefore matter.
03Identify what actually has to be removed.
Some installations may need removal; others may be retained by agreement. Decide this before the final week.
04Negotiate an access period if handback cannot be immediate.
If dismantling continues after trading ends, document whether the tenant may remain solely for removal and restoration.
The agreement should cover access, utilities, insurance, safety, contractors and the charge for the additional period.
05Avoid accidental indefinite renewal.
Civil and Commercial Code section 570 provides that if the tenant remains in possession after the agreed term and the landlord knows and does not object, the parties are deemed to have made a new lease for an indefinite period.
If the intention is only short exit access, document it rather than rely on silence. Supreme Court Judgment No. 2655/2526 illustrates the statutory holdover rule after an enforceable lease term ended.
06Price delayed return separately from reinstatement liability.
Late occupation charges and repair liability are different. The lease should avoid unclear overlap, and the tenant should budget both where applicable.
07Get evidence of final acceptance.
Use a joint inspection, photographs, meter readings, key return and a signed handback record.
Without an acceptance date, disputes can continue over when occupation and holdover charges ended.
What We Usually Look At
We review expiry and termination dates, removal and reinstatement obligations, fit-out ownership, entry condition evidence, holdover charges, access, utilities, insurance, contractors and the proposed handback certificate.
Common Traps
Typical mistakes are scheduling dismantling after the lease ends without landlord consent, assuming cessation of trading equals vacant possession, leaving removal decisions to the final week, ignoring section 570 and failing to record the date the landlord actually accepted the premises back.
Practical Next Step
Build the exit programme backwards:
handback date → joint inspection → reinstatement complete → equipment removed → shutdown → contractor mobilisation → landlord approvals
If the dates do not fit, negotiate the exit-access period before the lease expires.
Legal Sources
- Civil and Commercial Code, sections 561 and 562 on return condition and tenant responsibility for loss or damage.
- Civil and Commercial Code, sections 564 and 570 on expiry of a fixed-term lease and continued possession after expiry.
- Supreme Court Judgment No. 5692/2546, on the tenant’s duty to remove tenant-installed structures and return leased land after the lease ended, with damages arising from failure to restore possession.
- Supreme Court Judgment No. 6470/2537, on the continuing duty to remove structures and return leased land after expiry.
- Supreme Court Judgment No. 2655/2526, applying section 570 where the tenant remained after the enforceable lease period and the landlord did not object.
General legal information only. Please seek advice on your specific facts. Laws and regulatory practice may change.