Supreme Court on Terminating Caretaker Contracts

Mar 1, 2024 Benn-Ibler Rechtsanwälte

The Austrian Supreme Court (Oberster Gerichtshof, hereinafter OGH) dealt with terminating a caretaker contract, ruling that landlords can only terminate such contracts for serious reasons if the caretaker is entitled to employee housing.

The plaintiff owns a two-storeyed house which is divided into five flats. He would like to carry out all domestic tasks himself in the future, as he has been in semi-retirement since July 2023. In the event that the plaintiff should not be able to do so in the short term, his family would take over the services free of charge.

Dissatisfied with the scope and quality of the caretaker services provided by the defendant, the plaintiff wanted to discontinue the caretaker’s position. He also wanted to save on running costs and to combine and renovate a detached house with the neighbouring caretaker’s flat in order to create an additional source of income.

Both the lower courts and the OGH confirmed the existence of grounds for termination under Section 18(6)(d) of the Austrian Caretakers Act (Hausbesorgergesetz, HbG).

In addition to gross negligence or misconduct on the part of a caretaker, a possible reason for termination is the caretaker’s resignation from the position.

The landlord must show good cause and a serious intention to relinquish the caretaker job. For example, if the owner or tenants were to do all the work for free in the future, this would be a good reason. However, the position may not be discontinued merely for the sake of pretence, as there is no other relevant reason for terminating the caretaker’s employment.

The filing of a notice of termination of a caretaker service agreement and the assertion of grounds for termination within the meaning of Section 18 (6) HbG is not bound by a time limit. It is also not necessary for the position to be vacant at the time of termination in order for grounds for termination to exist. A serious and specific intention to do so in future is sufficient.

OGH 8 ObA 1/24s (11 January 2024)