Partial Invalidity of Value Protection Clauses in Tenancy Law

Jun 25, 2026 Benn-Ibler Rechtsanwälte

In the case at hand, the Austrian Supreme Court (Oberster Gerichtshof, hereinafter OGH) has clarified that a partially inadmissible value protection clause within a tenancy agreement does not automatically invalidate the entire valorisation arrangement. Where such a clause is deemed impermissible, mandatory provisions of tenancy law are applied in its place.

A tenant had sought repayment of rent from the defendant landlord, claiming the value protection clause—used to determine rent amounts—was invalid. The appellate court rejected the claim. While the contractual provisions regarding the calculation and due date of value protection were found invalid, the underlying valorisation agreement governing increased rent remained independent and enforceable.

The OGH affirmed this interpretation, dismissing the tenant’s extraordinary appeal. According to the Court, provisions relating to value protection and those concerning increased rent charges address distinct regulatory areas and are separable. Thus, the removal of an inadmissible clause does not affect the validity of the agreed valorisation.

Mandatory statutory regulations, as outlined in Section 16(9) of the Austrian Tenancy Act (Mietrechtsgesetz, hereinafter MRG), replace any invalid contractual stipulations. These rules establish the criteria under which increased rent may be claimed.

The jurisprudence of the European Court of Justice (ECJ) does not conflict with this approach. Although void abusive contractual clauses generally cannot be substituted by discretionary national law provisions, this principle does not apply to mandatory statutory requirements, such as Section 16(9) of the MRG, which override contractual arrangements detrimental to tenants.

OGH 1 Ob 2/26i (28/04/2026)