Rigid Periods for Business Spaces

While the BGH made a big splash with its judgment as reported in "Rigid Periods for Compulsory Interior Redecoration are Illegal" determining that clauses in the rental contract containing fixed periods are invalid. It now clarified the legal situation for business spaces on October 8, 2008 (re XII ZR 84/06). Do not forget that only residential contracts enjoy a high standard of protection.

The Federal Court of Justice had to decide whether a contractual stipulation that the tenant has to take care of the beauty repairs when the renovation period is fixed and not dependant on the wear and tear of the apartment. The tenant had rented a store space. The contract determined that the space was to be generally renovated every fifth year, however the kitchen and bathroom(s) were to be done every third year.

The statutory rule on beauty repairs is that the landlord is required to take of such things (§535 I 2 BGB). However, it is also legal to burden this duty on to the tenant. This is possible when such stipulation is agreed upon in a form or form contract. Whenever this is the case, and it is usually the case, such a contract is considered as standard terms and agreements - subject to the rules on STC. Following §307 BGB, a stipulation is invalid when a contractual partner is unreasonably disadvantaged against good morals practice (§242 BGB). This will be especially the case, when the contractual stipulation contradicts essential statutory regulations (§307 II 1 BGB).

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Rigid Periods for Compulsory Interior Redecoration are Illegal