OGH on Standard Terms in Rental Contracts

Nov 22, 2024 Benn-Ibler Rechtsanwälte

In a case brought by a consumer protection organisation, the Austrian Supreme Court (Oberster Gerichtshof, hereinafter OGH) has prohibited the use of 37 clauses that are unfavourable to consumers in pre-formulated rental contracts of a property management company and a commercial landlord. The following clauses, among others, were declared inadmissible:

Clause 8

‘The principal rent is indexed according to the index of total construction costs for housing and dwellings (base year 2010) on the basis of the index value published in the month of the mutual signing of the contract. [...]’

Clauses providing for the indexation of rents in residential leases of commercial landlords must be assessed against the requirements of Section 6(1)(5) of the Austrian Consumer Protection Act (Konsumentenschutzgesetz, hereinafter KSchG). This provision serves to protect consumers against unexpected and objectively unjustified price increases.

In view of the purpose of value guarantee agreements, namely to stabilise the intrinsic value of a claim and to maintain the subjective equivalence of the reciprocal services in a lease, it is not objectively appropriate to link the rent indexation to the development of only one of several factors determining the landlord’s current cost burden, i.e., the maintenance costs. Such an approach would inevitably lead to a distortion of the original equivalence. It would not even come close to reflecting the specific cost trends for commercial landlords or the average market trend. Therefore, the OGH has made it clear that the indexation clause was not objectively justified within the meaning of Section 6(1)(5) of the KSchG.

Clause 16

‘Any additions or explanations made by the tenant on bank payment slips will not be communicated to the landlord as a result of bank processing.’

The OGH ruled that this clause was inadmissible because it suggested that any text provided by the tenant on a payment slip would not be effective. In addition, the clause does not make it clear whether ‘additions and explanations’ shall include information given in the ‘intended payment purpose’ line of the slip or exclusively ‘other’ additions and explanations. Therefore, the use of the clause is prohibited because it violates the transparency requirement under Section 6(3) of the KSchG and is grossly unfair within the meaning of Section 879(3) of the Austrian Civil Code (Allgemeines bürgerliches Gesetzbuch, ABGB).

OGH 10 Ob 23/24s (10 September 2024)