OGH: Major Ruling on Rental Agreement Clauses (Part 9)

Sept 13, 2024 Benn-Ibler Rechtsanwälte

In recent issues of the USANCEN newsletter we have been publishing excerpts from an extensive decision by the Austrian Supreme Court (Oberster Gerichtshof, hereinafter OGH) fraught with practical implications. This week, we are featuring the ninth part of the OGH ruling, dealing with the landlord’s maintenance obligations.

Clause 25:

‘Insofar as the landlord is not obliged to maintain the leased premises [...] the tenant shall also be obliged to maintain the leased premises and its fixtures and fittings.’

This clause is grossly unfair within the meaning of Section 879(3) of the Austrian Civil Code (Allgemeines bürgerliches Gesetzbuch, hereinafter ABGB), as there is no objective justification for the transfer of the maintenance obligation pursuant to Section 1096(1) sentence 1 of the ABGB). A corresponding consideration in the amount of rent was not given, but according to the OGH this can be taken into account in favour of the landlord within the framework of comprehensively balancing interests.

Clause 26:

‘Insofar as the above paragraphs deviate from the provisions of Section 1096(1)(1) of the ABGB, this shall be taken into account in the calculation of the principal rent [1] to the extent that the maintenance and upkeep obligations transferred to the tenant are offset against the principal rent.’

The clause provides for a flat-rate deduction from the principal rent where maintenance obligations are to be passed on to the tenant. It remains completely unclear how the amount of the maintenance obligations is assessed and what the principal rent would be if the maintenance obligations were not passed on to the tenant. According to the OGH, such a form of contract design and determining of the tenant’s obligation violates the transparency requirement of Section 6(3) of the Austrian Consumer Protection Act (Konsumentenschutzgesetz, KSchG).

Clause 27:

If the tenant fails to comply with their contractually agreed maintenance and upkeep obligations, the landlord may, after having unsuccessfully requested the tenant to comply and, after the expiry of a reasonable period of grace specified therein, have the necessary work carried out on the rented property at the tenant’s expense.

This clause is linked to the inadmissibility of the transfer of the tenant’s maintenance obligations (see Clauses 19 and 23). According to OGH case law, the inadmissibility of the clause to which reference is made necessarily leads to the inadmissibility of Clause 27 as well.

OGH 9 Ob 4/23p (24 January 2024)

[1] In Austria, the German term is Hauptmietzins (or Nettomietzins).