As is often the case, some new legal institutions offered in business practice are accepted quite uncritically.
In other words, the focus is usually only on the positive aspects, while the negative ones are disregarded. A good example of such strange behavior is the leasing contract, which has become very widespread in Croatian practice, and the Leasing Act represents a true example of a law that shows its inability to find an appropriate Croatian word instead of a foreign term (it is interesting to compare this with the recent legal provision that did not allow the designation of a company in a foreign language, including English). It is true that the leasing installment is somewhat lower than the credit one, as well as that the so-called HROK search (mandatory for every loan application, and practically unknown in leasing) leaves many with no choice, and leasing is their only option. However, there are many things that anyone considering leasing should take into account. In this text, we will limit ourselves to just a few of the most important ones.
To the detriment of the lessee Every item taken on lease remains the property of the leasing company for the duration of the contract, and such an item does not provide any security for the creditors of the lessee. This applies to both operational and financial leasing.
In principle, leasing companies impose the obligation to conclude a casco insurance contract, of course at the expense of the lessee. However, casco insurance covers cases of theft (and not in all countries, it is necessary to read the insurance policy carefully, including the fine print and what is stated in the general insurance conditions, especially for individuals traveling to countries outside the European Union, which are often excluded from theft insurance) and damage, but not breakdowns, so in the case of breakdowns, an absurd situation occurs – the leased item cannot be used, while the obligation to pay the leasing installments continues unchanged (in one case, the lessee only requested a payment delay because the repair covered by the manufacturer’s warranty took more than a month, but the leasing provider did not want to hear about it).
Depreciation The old legal principle states that all problems burden the owner (res perit domino), the owner is the leasing provider, and all problems burden the lessee. To make matters worse, if the lessee uses the item more than average (and for vehicles, for example, this data is now recorded and permanently stored during the technical inspection), the value of the item decreases, and the insurer (if they pay the damage) will reduce it, and the lessee will then have to pay the difference and any difference to the market value to the leasing provider.
The lessee cannot afford to have practically any conflict with the leasing provider if it concerns a vehicle or vessel that is subject to registration because without the leasing provider as the owner, there is no extension of registration.
