Last Updated on June 27, 2021 by LawEuro
German Civil Code (BGB) German law
Subtitle 2
Leases for residential space
Chapter 1
General provisions
Section 549
Provisions applicable to leases of residential space
(1) Sections 535 to 548 apply to leases relating to residential space to the extent not otherwise stipulated by sections 549 to 577a.
(2) The provisions relating to rent increases (sections 557 to 561) and to lessee protection upon termination of the lease as well as when residential property is created (section 568 (2), sections 573, 573a and 573 d (1), sections 574 to 575, 575a (1) and sections 577 and 577a) do not apply to leases of
1. residential space that is leased only for temporary use,
2. residential space that is part of the dwelling inhabited by the lessor himself and has largely to be furnished with furniture and fixtures by the lessor himself, provided that permission to use the residential space has not been given for permanent use to the lessee with his family or with persons with whom he maintains a joint household set up permanently,
3. residential space that a legal person under public law or a recognised private welfare work organisation has leased to permit use by persons in urgent need of accommodation if, when the lease was entered into, it drew the attention of the lessee to the intended purpose of the residential space and to its exemption from the provisions referred to above.
(3) Sections 557 to 561 and sections 573, 573a and 573d (1) and sections 575, 575a (1) and sections 577 and 577a do not apply to residential space in a student hostel or a hostel for young people.
Section 550
Form of the lease agreement
If a lease agreement for a longer period of time than one year is not entered into in written form, then it applies for an indefinite period of time. However, termination is only allowed at the earliest at the end of one year after use of the residential space has been permitted.
Section 551
Restriction and investment of rent security deposits
(1) If the lessee must give the lessor a security deposit for the performance of his duties, then this security deposit, subject to subsection (3) sentence 4, may amount at most to three times the rent for one month, exclusive of the operating costs shown as a lump sum or as an advance payment.
(2) If security is to be provided in the form of a sum of money, then the lessee is entitled to pay in three equal monthly instalments. The first instalment is due upon commencement of the lease. The further instalments are due together with the immediately ensuing rent payments.
(3) The lessor must invest a sum of money transferred to him as a deposit with a banking institution at the usual rate of interest for savings deposits with withdrawal notice of three months. The parties to the contract may agree on another form of investment. In either case the investment must be made separately from the assets of the lessor and the lessee is entitled to the income. It accrues to the security deposit. For residential space in a student hostel or a hostel for young people, there is no duty for the lessor to pay interest on the security deposit.
(4) A deviating agreement to the disadvantage of the lessee is ineffective.
Section 552
Warding off the right of removal of the lessee
(1) The lessor may ward off exercise of the right of removal (section 539 (2)) by payment of appropriate compensation unless the lessee has a justified interest in removal.
(2) An agreement excluding the right of removal is only effective if reasonable compensation is provided for.
Section 553
Permitting use by third parties
(1) If the lessee, after entering into the lease agreement, acquires a justified interest in permitting a third party to use part of the residential space, then he may demand permission to do so from the lessor. This does not apply if there is a compelling reason in the person of the third party, if the residential space would be overcrowded or if the lessor cannot for other reasons reasonably be expected to permit third-party use.
(2) If the lessor can only be expected to permit third-party use on a reasonable increase of the rent, then he may make permission dependent upon the lessee agreeing to such an increase in rent.
(3) A deviating agreement to the disadvantage of the lessee is ineffective.
Section 554
(repealed)
Section 554a
Accessibility
(1) The lessee may demand the approval of the lessor to structural changes or other installations required to make the use of the leased property or access to it fit for the needs of the disabled, if he has a justified interest in this. The lessor may refuse approval if his interest in maintaining the leased property or building unchanged outweighs the interest of the lessee in making use of the leased property fit for the needs of the disabled. When this is done, the justified interests of the other lessees in the building are to be taken into account.
(2) The lessor may make his approval dependent upon payment of a reasonable additional security deposit for restoration of the original condition. Section 551 (3) and (4) applies with the necessary modifications.
(3) An agreement deviating from subsection (1) to the disadvantage of the lessee is ineffective.
Section 555
Ineffectiveness of contractual penalty
An agreement by which the lessor binds the lessee to promise a contractual penalty is ineffective.
Chapter 1a
Structural maintenance and modernisation measures
Section 555a
Structural maintenance measures
(1) The lessee must tolerate measures that are necessary for the structural maintenance or repair of the leased property (structural maintenance measures).
(2) The lessee is to be given notice of structural maintenance measures in good time unless they only entail an insignificant impact on the leased property or it is imperative for them to be implemented immediately.
(3) The lessor must compensate for expenditure incurred by the lessee as a result of a structural maintenance measure to a suitable degree. He is to make an advance payment on request.
(4) An agreement deviating from subsection (2) or (3) to the disadvantage of the lessee is ineffective.
Section 555b
Modernisation measures
Modernisation measures are building alterations
1. by means of which final energy is saved with lasting effect in relation to the leased property (energy efficiency modernisation),
2. by means of which non-renewable primary energy is saved with lasting effect or the climate is protected with lasting effect, unless energy efficiency modernisation has already been carried out in accordance with no. 1,
3. by means of which water consumption is reduced with lasting effect,
4. by means of which the utility value of the leased property is increased with lasting effect,
5. by means of which the general living conditions are permanently improved,
6. which are carried out due to circumstances for which the lessor is not responsible, and which do not constitute structural maintenance measures in accordance with section 555a, or
7. by means of which new residential space is created.
Section 555c
Announcement of modernisation measures
(1) The lessor must announce a modernisation measure to the lessee at the latest three months prior to its commencement in text form (modernisation notice). The modernisation notice must contain information on:
1. the nature and the likely extent of the modernisation measure in its essentials,
2. the likely commencement and the likely duration of the modernisation measure,
3. the amount of the anticipated rent increase where an increase is to be demanded in accordance with section 559, as well as the anticipated future operating costs.
(2) The lessor should notify the lessee in the modernisation notice of the form and the time limit of the hardship objection in accordance with section 555d (3) sentence 1.
(3) The lessor may refer in the modernisation notice for a modernisation measure in accordance with section 555b nos. 1 and 2 to generally-recognised standard values, in particular with regard to the quality of construction components in terms of energy efficiency.
(4) Subsections (1) to (3) do not apply to modernisation measures which only entail an insignificant impact on the leased property and only lead to an insignificant rent increase.
(5) A deviating agreement to the disadvantage of the lessee is ineffective.
Section 555d
Toleration of modernisation measures, time limit
(1) The lessee is to tolerate a modernisation measure.
(2) There is no obligation of toleration in accordance with subsection (1) if the modernisation measure would constitute a hardship for the lessor, his/her family or a member of his/her household that is not justifiable even considering the justified interests of both the lessor and other lessees in the building, as well as the interests of energy saving and climate protection. The anticipated rent increase, as well as the anticipated future operating costs, shall not be included in the consideration of the obligation of toleration; they shall only be included in accordance with section 559 (4) and (5) in case of a rent increase.
(3) The lessee shall inform the lessor, in text form, of circumstances constituting a hardship with regard to the toleration or to the rent increase by the end of the month following receipt of the modernisation notice. The time limit shall only start to run if the modernisation notice complies with the provisions contained in section 555c.
(4) Once the time limit has expired, circumstances giving rise to a hardship with regard to the toleration or to the rent increase are still to be taken into consideration if the lessee was prevented without blame from meeting the deadline and he/she informs the lessor of the circumstances as well as of the reasons for the delay promptly and in text form. Circumstances which constitute a hardship with regard to the rent increase shall only be taken into consideration if they are notified at the latest by the time of commencement of the modernisation measure.
(5) If the lessor has not referred in the modernisation notice to the form and the time limit applying to the hardship objection (section 555c (2)), the notice of the lessee in accordance with subsection (3) sentence 1 does not have to be submitted in the form and time limit determined therein. Subsection (4) sentence 2 applies with the necessary modifications.
(6) Section 555a subsection (3) applies with the necessary modifications.
(7) A deviating agreement to the disadvantage of the lessee is ineffective.
Section 555e
Special termination right of the lessee in case of modernisation measures
(1) On receipt of the modernisation notice, the lessee may give extraordinary notice with regard to the tenancy as per the end of the month after next. Notice must be given by the end of the month following receipt of the modernisation notice.
(2) Section 555c (4) applies with the necessary modifications.
(3) A deviating agreement which is to the disadvantage of the lessee is ineffective.
Section 555f
Agreements on structural maintenance or modernisation measures
The contracting parties may reach agreements after conclusion of the tenancy agreement where structural maintenance or modernisation measures are to be carried out, in particular with regard to the
1. time and technical implementation of the measures,
2. lessee’s guarantee rights and rights to compensation for expenditure,
3. future rent amount.
Chapter 2
Rent
Subchapter 1
Agreements on rent
Section 556
Agreements on operating costs
(1) The parties to the contract may agree that the lessee is to bear operating costs. Operating costs are the costs that are incurred from day to day by the owner or the holder of the heritable building right as a result of the ownership of or the heritable building right to the plot of land or as a result of the intended use of the building, the outbuildings, facilities, installations and the land. The drawing up of the statement of operating costs continues to be governed by the Operating Costs Order [Betriebskostenverordnung] of 25 November 2003 (Federal Law Gazette I pp. 2346, 2347). The Federal Government is authorised to pass provisions on the drawing up of the statement of operating costs by statutory order without the approval of the Federal Council [Bundesrat].
(2) The parties to the contract may agree, subject to other provisions, that operating costs may be reported as a lump sum or as an advance payment. Advance payments for operating costs may only be agreed in a reasonable amount.
(3) Advance payments for operating costs are to be invoiced once per year, and when this is done the principle of economic efficiency is to be observed. The lessee is to be notified of the statement of operating costs at the latest by the end of the twelfth month subsequent to the accounting period. After this period, assertion of a subsequent demand by the lessor is excluded unless the lessor is not responsible for the lateness of the assertion. The lessor is not obliged to provide interim invoicing. The lessor must be informed by the lessee of any objections to invoicing at the latest by the end of the twelfth month after receipt of the invoice. After expiry of this period, objections may no longer be asserted unless the lessee is not responsible for the lateness of the assertion.
(4) An agreement deviating to the disadvantage of the lessee from subsections (1) and (2) sentence 2 or subsection (3) is ineffective.
Section 556a
Accounting criterion for operating costs
(1) If the parties to the contract have not agreed otherwise and subject to other provisions, operating costs are to be apportioned in proportion to the floor space. Operating costs depending on recorded consumption or causation by the lessees are to be apportioned according to criteria that take into account the differing consumption or causation.
(2) If the parties to the contract have agreed otherwise, the lessor may by declaration in text form specify that the operating costs may in future, contrary to the agreement reached, be apportioned in whole or in part according to a criterion that takes into account the recorded differing consumption or the recorded differing causation. The declaration may only be made prior to commencement of an accounting period. If the costs have previously been included in the rent, the rent is to be reduced accordingly.
(3) An agreement deviating to the disadvantage of the lessee from subsection (2) is ineffective.
Section 556b
Due date of rent, right to set-off and right of retention
(1) Rent is to be paid at the commencement of the periods of time according to which it is computed but at the latest by the third working day of each such period.
(2) The lessee may, notwithstanding a contract provision to the contrary, set off a claim based on sections 536a and 539 or a claim for unjust enrichment for excess payment of rent against a claim for rent, or may exercise a right of retention in relation to such a claim if he has notified the lessor in text form of his intention to do so at least one month prior to the due date of the rent. A deviating agreement to the disadvantage of the lessee is ineffective.
Section 556c
Costs of heat supply as operational costs, empowerment to issue an ordinance
(1) If the lessee must pay the operating costs for heat or hot water, and if the lessor converts the supply from internal supply to an independent commercial supply from a heat supplier (heat supply), the lessee must meet the cost of heat supply as operational costs if
1. the heat is supplied more efficiently, either from a new system constructed by the heat supplier or from a heat network, and
2. the costs of heat supply do not exceed the operating costs for the previous internal supply of heat or hot water.
If the annual utilisation rate of the existing system prior to conversion is at least 80 percent, the heat supplier may restrict itself to improving the operation of the system in place of the measures in accordance with no. 1.
(2) The lessor must announce the conversion at the latest three months in advance and in text form (conversion notice).
(3) The Federal Government is herewith empowered to issue by means of a legal ordinance without the consent of the Federal Council provisions for heat supply contracts which are concluded on conversion in accordance with subsection (1), as well as for the requirements in accordance with subsections (1) and (2). The interests of lessors, lessees and heat suppliers must be adequately taken into account in doing so.
(4) A deviating agreement to the disadvantage of the lessee is ineffective.
Subchapter 2
Provisions on the rent amount
Section 557
Increases in rent by agreement or law
(1) During the lease, the parties may agree an increase in rent.
(2) Future changes in the amount of rent may be agreed by the parties to the contract as stepped rent under section 557a or as indexed rent under section 557b.
(3) Apart from this, the lessor may only demand rent increases under the provisions of sections 558 to 560 to the extent that an increase is not excluded by agreement or the exclusion emerges from the circumstances.
(4) A deviating agreement to the disadvantage of the lessee is ineffective.
Section 557a
Stepped rent
(1) The rent may be agreed in writing in varying amounts for specific periods of time; in the agreement, each rent amount or each increase must be indicated as a monetary amount (stepped rent).
(2) The rent must remain unchanged on each occasion for at least one year. During the period of stepped rent, an increase under sections 558 to 559b is excluded.
(3) The right of the lessee to give notice may be excluded for a maximum of four years after the stepped rent agreement is entered into. Notice of termination is allowed to the end of this period at the earliest.
(4) A deviating agreement to the disadvantage of the lessee is ineffective.
Section 557b
Indexed rent
(1) The parties to the contract may agree in writing that the rent is to be determined by means of the price index for the cost of living of all private households in Germany computed by the Federal Statistics Office [Statistisches Bundesamt] (indexed rent).
(2) While an indexed rent is applicable, the rent, except for increases under sections 559 to 560, must remain unchanged for at least one year at a time. An increase under section 559 may only be demanded to the extent that the lessor has carried out structural measures due to circumstances for which he is not responsible. An increase under section 558 is excluded.
(3) A change in rent under subsection (1) must be made by declaration in text form. In this declaration, the change in the price index that has occurred as well as the rent in the individual case or the increase must be indicated as a monetary amount. The revised rent must be paid at the commencement of the second month beginning after receipt of the declaration.
(4) A deviating agreement to the disadvantage of the lessee is ineffective.
Section 558
Increase in rent up to the reference rent customary in the locality
(1) The lessor may demand approval of an increase in rent up to the reference rent customary in the locality if, at the time when the increase is to occur, the rent has remained unchanged for fifteen months. The demand for a rent increase may be made at the earliest one year after the most recent rent increase. Increases under sections 559 to 560 are not taken into account.
(2) The reference rent customary in the locality is formed from the usual payments that have been agreed or, with the exception of increases under section 560, that have been changed in the last four years in the municipality or in a comparable municipality for residential space that is comparable in type, size, furnishings, quality and location, including the energy systems and characteristics. Exempted from this is residential space where the amount of rent has been stipulated by law or in connection with a promise of sponsorship.
(3) In the case of increases under subsection (1), the rent may not be raised within three years, except for increases under sections 559 to 560, by more than twenty per cent (capping limit). The percentage in accordance with sentence 1 is 15 percent if the adequate supply of the population with rented dwellings under suitable conditions in a municipality or a part of a municipality is particularly placed at risk and these areas are determined in accordance with sentence 3. The Land Governments are herewith empowered to determine these areas by means of a legal ordinance for a maximum duration of five years in each case.
(4) The capping limit does not apply
1. if a duty of the lessee to make compensation payments under the provisions on the reduction of improper subsidisation in housing has lapsed because the public-sector connection has ceased, and
2. to the extent that the increase does not exceed the amount of the most recently payable compensation payment.
The lessor may at the earliest four months prior to the cessation of the public-sector connection demand that the lessee inform him within one month of the duty to pay compensation and of its amount. Sentence 1 applies with the necessary modifications if the duty of the lessee to make a compensation payment under sections 34 to 37 of the Residential Housing Subsidisation Act [Wohnraumförderungsgesetz] and provisions of Land law issued thereunder has lapsed due to the repeal of rent control.
(5) From the annual amount that would result in the case of an increase to the reference rent customary in the locality, third-party funds within the meaning of section 559a are to be deducted, in the case of section 559a (1) in the amount of eleven per cent of the subsidy.
(6) A deviating agreement to the disadvantage of the lessee is ineffective.
Section 558a
Form and justification of the rent increase
(1) A rent increase demand under section 558 must be declared and justified to the lessee in text form.
(2) In justification, reference may in particular be made to
1. a list of representative rents (sections 558c and 558d),
2. information from a rent database (section 558e),
3. an opinion, provided with supporting grounds, by an officially appointed and sworn expert,
4. examples of equivalent payment for individual comparable dwellings; in this case, it is sufficient to name three dwellings.
(3) If an expert list of representative rents (section 558d (1)), where the provisions of section 558d (2) have been complied with, contains information for the dwelling, then the lessor must in his demand for a rent increase communicate such information even if he wishes to support his rent increase by another means of justification under subsection (2).
(4) When making reference to a list of representative rents containing spans, it is sufficient if the rent demanded lies within the span. If, at the time when the lessor makes his declaration, no list of representative rents in which sections 558c (3) or 558d (2) have been complied with is available, then another list of representative rents, in particular an outdated one, or a list of representative rents from a comparable municipality may be used.
(5) A deviating agreement to the disadvantage of the lessee is ineffective.
Section 558b
Approval of a rent increase
(1) To the extent that the lessee approves the rent increase, he owes the increased rent from the beginning of the third calendar month after receipt of the demand for an increase.
(2) To the extent that the lessee does not approve of the rent increase by the end of the second calendar month after receipt of the demand, the lessor may sue for grant of approval. An action must be brought within three additional months.
(3) If the action is preceded by a demand for increase that does not comply with the requirements of section 558a, then the lessor may correct this in the legal dispute or remedy the defects in the demand for increase. In this case too, the lessee is entitled to the approval period under subsection (2) sentence 1.
(4) A deviating agreement to the disadvantage of the lessee is ineffective.
Section 558c
List of representative rents
(1) A list of representative rents is a table showing the reference rent customary in the locality, if the table has been jointly produced or recognised by the municipality or by representatives of lessors and lessees.
(2) Lists of representative rents may be produced for the area of one municipality or of more than one municipality or for parts of municipalities.
(3) Lists of representative rents should be adjusted for market trends at intervals of two years.
(4) Municipalities should produce lists of representative rents if there is a need for this and if this is possible at a reasonable cost. The lists of representative rents and the changes to them should be published.
(5) The Federal Government is authorised, by statutory order issued with the approval of the Federal Council [Bundesrat], to issue provisions on the detailed contents and on the procedure for drawing up and adjusting lists of representative rents.
Section 558d
Expert list of representative rents
(1) An expert list of representative rents is a list of representative rents produced according to recognised scientific principles and recognised by the municipality or by representatives of lessors and lessees.
(2) The expert list of representative rents is to be adjusted for market trends at intervals of two years. When this is done, a spot check or the trend of the price index for living standards of all private households in Germany computed by the Federal Statistical Office [Statistisches Bundesamt] may be used as a basis. After four years a new expert list of representative rents must be produced.
(3) If the provisions of subsection (2) are complied with, then it is assumed that the payment cited in the expert list of representative rents reflects the reference rent customary in the locality.
Section 558e
Rent database
A rent database is a collection of rents maintained on an ongoing basis to determine the reference rent customary in the locality; this database is jointly maintained or recognised by the municipality or by representatives of lessors and lessees, and information is issued on the basis of this database that makes it possible to come to a conclusion as to the reference rent customary in the locality with regard to individual dwellings.
Section 559
Rent increase after modernisation measures
(1) If the lessor has carried out modernisation measures within the meaning of section 555b no. 1, 3, 4, 5 or 6,he may increase the annual rent by 11 per cent of the costs spent on the dwelling.
(2) Costs which would have been necessary for structural maintenance measures do not belong among the costs expended in accordance with subsection (1); where necessary, they are to be ascertained by estimation.
(3) If modernisation measures are carried out for more than one dwelling, the costs must be apportioned reasonably among the individual dwellings.
(4) The rent increase is ruled out where, also taking account of the likely future operating costs for the lessee, it would signify a hardship which cannot be justified, even taking account of the legitimate interests of the lessor. No consideration in accordance with sentence 1 shall take place if
1. the property was merely restored to a generally customary condition, or
2. the modernisation measure was carried out as a result of circumstances for which the lessor was not responsible.
(5) Circumstances which constitute a hardship in accordance with subsection (4) sentence 1 are only to be taken into account if they have been notified in good time in accordance with section 555d (3) to (5). The provisions on the cut-off period in accordance with sentence 1 are not to be applied if the de facto rent increase exceeds that which had been announced by more than ten percent.
(6) A deviating agreement to the disadvantage of the lessee is ineffective.
Section 559a
Crediting of third-party funds
(1) Costs assumed by the lessee or assumed by a third party for the lessee or covered by subsidies from public authorities do not form part of costs spent within the meaning of section 559.
(2) If the costs of the modernisation measures are covered in full or in part by low-interest or interest-free loans from public authorities, then the amount of the increase under section 559 is reduced by the annual amount of the interest reduction. The latter is calculated from the difference between the reduced rate of interest and the going market interest rate for the original amount of the loan. The going market interest rate for first-priority mortgages at the date when the modernisation measures ended is conclusive. If subsidies or loans are used to cover ongoing outlays, then the amount of the increase is reduced by the annual amount of the subsidy or loan.
(3) A lessee loan, an advance rent payment or a service performed for the lessee by a third party for the modernisation measures are equivalent to a loan from public authorities. Funds from the financial institutions of the Federal Government or of a Land are deemed to be funds from public authorities.
(4) If it cannot be ascertained in what amount subsidies or loans have been granted for the individual dwellings, then they must be apportioned according to the ratio of costs spent on individual dwellings.
(5) A deviating agreement to the disadvantage of the lessee is ineffective.
Section 559b
Assertion of an increase; effect of declaration of increase
(1) The rent increase under section 559 must be declared to the lessee in text form. The declaration is only effective if in it the increase is calculated on the basis of the costs incurred and explained in accordance with the requirements of sections 559 and 559a. Section 555c (3) applies with the necessary modifications.
(2) The lessee owes the increased rent from the beginning of the third month after receipt of the declaration. The period is extended by six months
1. if the lessor has failed to notify the lessee of the modernisation measure as required in accordance with the provisions contained in section 555c (1) and (3) to (5), or
2. if the de facto rent increase is more than ten per cent greater than the increase notified.
(3) A deviating agreement to the disadvantage of the lessee is ineffective.
Section 560
Changes in operating costs
(1) In the case of a lump sum charge for operating costs, the lessor is entitled to apportion increases in operating costs proportionately to the lessee by a declaration in text form, to the extent that this has been agreed in the lease agreement. The declaration is only effective if the basis of the apportionment is referred to and explained in it.
(2) The lessee owes the part of the apportionment falling to him from the beginning of the second month following the month in which the declaration is made. To the extent that the declaration is based on the fact that operating costs have risen retroactively, it has a retroactive effect from the date when the operating costs rose, but at the earliest from the beginning of the calendar year preceding the year of the declaration, provided the lessor makes the declaration within three months after he first has knowledge of the increase.
(3) If operating costs are reduced, then the lump sum for operating costs must be reduced accordingly from the date of such reduction. The lessee must be informed of the reduction without undue delay.
(4) If advance payments of operating costs have been agreed, then, after a statement of operating costs, each of the parties to the contract may undertake an adjustment to a reasonable amount by a declaration in text form.
(5) In the case of changes in operating costs, the principle of economic efficiency must be observed.
(6) A deviating agreement to the disadvantage of the lessee is ineffective.
Section 561
Special right of termination of the lessee following a rent increase
(1) If the lessor asserts a right to a rent increase under sections 558 or 559, then, until the end of the second month after receipt of the declaration of the lessor, the lessee may terminate the lease for cause by special notice to the end of the second month thereafter. If the lessee gives notice of termination, then the rent increase does not take effect.
(2) A deviating agreement to the disadvantage of the lessee is ineffective.
Chapter 3
Security right of the lessor
Section 562
Extent of the security right of the lessor
(1) The lessor, for his claims under the lease, has a security right over things contributed by the lessee. It does not extend to the things that are not subject to attachment.
(2) The security right may not be asserted for future compensation claims and for rent for periods subsequent to the current and the following year of the lease.
Section 562a
Extinction of the security right of the lessor
The security right of the lessor is extinguished upon the removal of the things from the plot of land, except if this removal occurs without the knowledge of or despite the objection of the lessor. The lessor may not object if this is consistent with the ordinary circumstances of life or if things left behind evidently suffice to give the lessor security.
Section 562b
Self-help; claim for return
(1) The lessor may prevent the removal of the things that are subject to his security right, even without having recourse to the court, to the extent that he is entitled to object to removal. If the lessee moves out, the lessor may take possession of these things.
(2) If the things have been removed without the knowledge of or despite the objection of the lessor, then he may demand surrender of the items for the purpose of returning them to the plot of land and, if the lessee has moved out, surrender of possession. The security right is extinguished at the end of one month after the lessor has obtained knowledge of removal of the things, unless he has previously asserted this claim in court.
Section 562c
Warding off the security right by provision of security
The lessee may ward off assertion of the security right of the lessor by provision of security. He may release each individual thing from the security right by providing security in the amount of its value.
Section 562d
Attachment by a third party
If a thing subject to the security right of the lessor is attached for another creditor, then in relation to this other creditor the security right may not be asserted for rent from an earlier period than the last year prior to the attachment.
Chapter 4
Change of parties to the contract
Section 563
Right of succession upon death of the lessee
(1) A spouse who maintains a joint household with the lessee succeeds to the lease upon the death of the lessee. The same applies to a civil partner.
(2) If children of the lessee live in the joint household of the lessee, then these children succeed to the lease on the death of the lessee if the spouse does not succeed. The succession of the civil partner is not affected by the succession of the children of the lessee. Other family members who maintain a joint household with the lessee succeed to the lease on the death of the lessee if the spouse or the civil partner does not succeed. The same applies to persons who maintain a joint household of a permanent nature with the lessee.
(3) If persons who have succeeded to the lease within the meaning of subsection (1) or (2) declare to the lessor within one month of obtaining knowledge of the death of the lessee that they do not wish to continue the lease, the succession is deemed not to have occurred. For persons without capacity to contract or having limited capacity to contract, section 210 applies with the necessary modifications. If more than one person succeeds to the lease, then each may make the declaration on his own behalf.
(4) The lessor may terminate the lease for cause with the statutory notice period within one month after obtaining knowledge of the definitive succession to the lease if there is a compelling reason in the person of the successor.
(5) A deviating agreement to the disadvantage of the lessee or of such persons as are entitled to succeed under subsection (1) or (2) is ineffective.
Section 563a
Continuation with surviving lessees
(1) If more persons than one within the meaning of section 563 are joint lessees, then the lease is continued, after the death of one lessee, with the surviving persons.
(2) The surviving lessees may, within one month after obtaining knowledge of the death of the lessee, terminate the lease for cause with the statutory notice period.
(3) A deviating agreement to the disadvantage of the lessee is ineffective.
Section 563b
Liability in the case of succession or continuation
(1) The persons who succeed to the lease under section 563 or with whom it is continued under section 563a are liable together with the heir as joint and several debtors for obligations incurred up to the death of the lessee. In relation to these persons, the heir has sole liability to the extent that nothing else has been specified.
(2) If the lessee paid rent in advance for a period of time subsequent to his death, the persons who succeed to the lease under section 563 or with whom it is continued under section 563a are obliged to surrender to the heir the sum that they save or gain due to such advance payment.
(3) The lessor may, if the deceased lessee did not provide any security, demand provision of security under section 551 from persons who succeed to the lease under section 563 or with whom it is continued under section 563a.
Section 564
Continuation of the lease with the heir; termination for cause
If, on the death of the lessee, no persons within the meaning of section 563 succeed to the lease or the lease is not continued with them under section 563a, then it is continued with the heir. In this case, both the heir and the lessor are entitled to terminate the lease for cause within one month with the statutory notice period after they obtain knowledge of the death of the lessee and of the fact that there has been no succession to the lease and no continuation thereof.
Section 565
Commercial subletting
(1) If under the lease agreement the lessee is to sublet the leased residential space to a third party on a commercial basis for residential purposes, then upon termination of the lease the lessor takes over the rights and duties under the lease agreement between the lessee and the third party. If the lessor enters into a new lease agreement for subletting on a commercial basis, then the lessee, in place of the previous party to the contract, takes over the rights and duties under the lease agreement with the third party.
(2) Sections 566 to 566e apply with the necessary modifications.
(3) A deviating agreement to the disadvantage of the lessee is ineffective.
Section 566
Purchase is subject to existing leases
(1) If, after the lessee is given use of the leased residential space, it is disposed of by the lessor to a third party, then the acquirer, in place of the lessor, takes over the rights and duties that arise under the lease agreement during the period of his ownership.
(2) If the acquirer does not perform his duties, then the lessor is liable in the same way as a surety who has waived the defence of unexhausted remedies for the damage to be compensated for by the acquirer. If the lessee obtains knowledge of the passing of ownership by notification from the lessor, then the lessor is released from liability unless the lessee terminates the lease to the earliest date at which termination is allowed.
Section 566a
Rent security deposit
If the lessee of the residential space disposed of has provided security to the lessor for the performance of his duties, then the acquirer takes over the rights and duties created by this. If, upon termination of the lease, the lessee is unable to obtain the security from the acquirer, then the lessor continues to be obliged to return it.
Section 566b
Advance disposition of the rent
(1) If the lessor, prior to the passing of ownership, disposes of the rent attributable to the period when the acquirer is entitled, then the disposition is effective to the extent that it relates to the rent for the calendar month current at the time when the ownership passes. If ownership passes after the fifteenth day of the month, then the disposition is also effective to the extent that it relates to the rent for the following calendar month.
(2) The acquirer must allow a disposition of the rent for a later period to be asserted against himself if he has knowledge of it at the time when ownership passes.
Section 566c
Agreement between lessee and lessor on the rent
A legal transaction entered into between lessee and lessor on the rent claim, including without limitation payment of rent, is effective in relation to the acquirer to the extent that it does not relate to rent for a period of time subsequent to the calendar month in which the lessee obtains knowledge of the passing of ownership. If the lessee obtains knowledge of this after the fifteenth day of the month, then the legal transaction is also effective to the extent that it relates to the rent for the next calendar month. A legal transaction undertaken after the passing of ownership is, however, ineffective if the lessee has knowledge of the passing of ownership when the legal transaction is entered into.
Section 566d
Set-off by the lessee
To the extent that payment of the rent to the lessor is effective in relation to the acquirer under section 566c, the lessee can set off against the claim to rent of the acquirer a claim to which he is entitled against the lessor. Set-off is excluded if the lessee acquires the counterclaim after obtaining knowledge of the passing of ownership, or if the counterclaim becomes due only after the lessee obtains knowledge and after the rent becomes due.
Section 566e
Notification by the lessor of passing of ownership
(1) If the lessor notifies the lessee that he has transferred ownership of the leased residential space to a third party, then he must, in regard to the rent claim, allow the notification of the transfer to be asserted against himself by the lessee even if it has not occurred or is not effective.
(2) The notification may be retracted only with the approval of the person who has been named as the new owner.
Section 567
Encumbrance of the residential space by the lessor
If, subsequent to permission of use to the lessee, the leased residential space is encumbered by the lessor with a third-party right, then sections 566 to 566e are to be applied with the necessary modifications if by exercise of the right the lessee is deprived of the use of it in conformity with the contract. If the lessee is restricted by the exercise of this right in his use in conformity with the contract, then the third party has a duty to the lessee to refrain from exercising the right to the extent that exercising the right would adversely affect use in conformity with the contract.
Section 567a
Disposal or encumbrance prior to permission of use of residential space
If, prior to transferring the use of the leased residential space to the lessee, the lessor disposes of the residential space to a third party or encumbers it with a right by the exercise of which the lessee is deprived of or restricted in the use of it in conformity with the contract, then the same applies as in the cases of sections 566 (1) and 567 if the acquirer has agreed with the lessor to take over the performance of the duties arising from the lease agreement.
Section 567b
Further disposal or encumbrance by the acquirer
If the leased residential space is further disposed of or encumbered by the acquirer, then sections 566 (1) and sections 566a to 567a are to be applied with the necessary modifications. If the new acquirer fails to perform the duties arising from the lease, then the lessor is liable to the lessee under section 566 (2).
Chapter 5
Termination of the lease
Subchapter 1
General provisions
Section 568
Form and contents of the notice of termination
(1) The notice of termination of the lease must be in written form.
(2) The lessor should, in good time, draw the attention of the lessee to the possibility of an objection and the form and period for the objection under sections 574 to 574b.
Section 569
Termination for cause without notice for a compelling reason
(1) A compelling reason within the meaning of section 543 (1) for the lessee also exists if the leased residential space is in such a condition that its use entails a significant endangerment of health. This also applies if the lessee knew of the hazardous condition when he entered into the lease agreement or waived his rights arising from this condition.
(2) A compelling reason within the meaning of section 543 (1) also exists if one party to the contract permanently disturbs the domestic peace in such a way that the party giving notice, taking all circumstances of the specific case into account, including without limitation fault of the parties to the contract, and weighing the interests of both parties, cannot reasonably be expected to continue the lease to the end of the notice period or until the lease is terminated in another way.
(2a) An important reason within the meaning of section 543 (1) is furthermore deemed to exist if the lessee is in arrears with regard to a provision of security in accordance with section 551 in the amount of a sum corresponding to twice the monthly rent. Operating costs to be shown as a flat-rate or advance payment are not to be taken into account in the calculation of the monthly rent in accordance with sentence 1. A grace period or a reminder in accordance with section 543 (3) sentence 1 is not needed. Subsection (3) no. 2 sentence 1, as well as section 543 (2) sentence 2, are to be applied with the necessary modifications.
(3) In supplement to section 543 (2) sentence 1 no. 3, the rules are:
1. In the case of section 543 (2) sentence 1, no. 3, letter a, the part of the rent in arrears may only be deemed not to be insignificant if it exceeds the rent for one month. This does not apply if the residential space is leased only for temporary use.
2. The notice of termination also becomes ineffective if, at the latest by the end of two months after the eviction claim is pending, the lessor is satisfied or a public authority agrees to satisfy the lessor with regard to the rent due and the compensation due under section 546a (1). This does not apply if, no longer than two years earlier, the notice of termination was preceded by a notice of termination that became ineffective under sentence 1 above.
3. If the lessee has been finally and absolutely ordered to pay an increased rent under sections 558 to 560, then the lessor may not terminate the lease for default in payment of the lessee before the end of two months after the final and absolute order unless the requirements for termination for cause without notice have already been satisfied due to rent previously owed.
(4) The compelling reason leading to termination must be stated in the notice of termination.
(5) An agreement diverging from subsections (1) to (3) of this provision or from section 543 to the disadvantage of the lessee is ineffective. In addition, an agreement is also ineffective under which the lessor is to be entitled to terminate the lease for cause without notice for other reasons than those permitted by law.
Section 570
Exclusion of the right of retention
The lessee is not entitled to any right of retention against the claim to return of the lessor.
Section 571
Further damages for late return of residential space
(1) If the lessee fails to return the leased residential space upon termination of the lease, then the lessor may only assert further damages within the meaning of section 546a (2) if the return failed to occur for reasons for which the lessee is responsible. Damage is only to be compensated for to the extent that equity demands indemnification. This does not apply if the lessee has given notice of termination.
(2) If the lessee is granted a period of time before vacating the premises under section 721 or section 794a of the Code of Civil Procedure [Zivilprozessordnung], then he is not liable for compensation for further damage until the end of the period of time.
(3) A deviating agreement to the disadvantage of the lessee is ineffective.
Section 572
Agreement on right of revocation; lease subject to condition subsequent
(1) The lessor may not invoke an agreement by which the lessor is intended to be entitled to revoke the lease agreement after he has permitted the lessee to use the residential space.
(2) In addition, the lessor may not invoke an agreement by which the lease is subject to a condition subsequent to the disadvantage of the lessee.
Subchapter 2
Leases for an indefinite period of time
Section 573
Notice of termination by the lessor
(1) The lessor may only give notice if he has a justified interest in the termination of the lease. Notice of termination for the purpose of increasing the rent is excluded.
(2) A justified interest of the lessor in the termination of the lease exists, without limitation, in cases where
1. the lessee has culpably and non-trivially violated his contractual duties,
2. the lessor needs the premises as a dwelling for himself, members of his family or members of his household, or
3. the lessor, by continuing the lease, would be prevented from making appropriate commercial use of the plot of land and would as a result suffer substantial disadvantages; the possibility of attaining a higher rent by leasing the residential space to others is disregarded; the lessor may likewise not invoke the fact that he wishes to dispose of the residential premises in connection with an intention to create apartment ownership, or in connection with a creation of apartment ownership that took place after use of the residential space was granted to the lessee.
(3) The reasons for a justified interest of the lessor must be indicated in the notice of termination. Other reasons are taken into account only to the extent that they arose subsequently.
(4) A deviating agreement to the disadvantage of the lessee is ineffective.
Section 573a
Simplified termination by the lessor
(1) The lessor may also terminate a lease of a dwelling in a building inhabited by the lessor himself and having no more than two dwellings without the need for a justified interest within the meaning of section 573. The notice period is in this case extended by three months.
(2) Subsection (1) applies with the necessary modifications to residential space inside the dwelling inhabited by the lessor himself to the extent that the residential space is not exempted from lessee protection under section 549 (2) no. 2.
(3) In the letter containing notice of termination it must be stated that the termination is based on the requirements of subsection (1) or (2).
(4) A deviating agreement to the disadvantage of the lessee is ineffective.
Section 573b
Partial termination by the lessor
(1) The lessor may terminate the lease of side rooms or parts of a plot of land that are not intended as residential without a justified interest within the meaning of section 573 if he limits the notice of termination to these rooms or parts of the plot of land and if he wishes to use them
1. to create residential space for the purpose of leasing, or
2. to provide the intended or existing residential space with side rooms or parts of a plot of land.
(2) Notice of termination is allowed at the latest on the third working day of a calendar month to the end of the second month thereafter.
(3) If commencement of construction work is delayed, then the lessee may demand an extension of the lease by an equivalent period of time.
(4) The lessee may demand an appropriate reduction of the rent.
(5) A deviating agreement to the disadvantage of the lessee is ineffective.
Section 573c
Termination notice periods
(1) Notice of termination is allowed at the latest on the third working day of a calendar month to the end of the second month thereafter. The notice period for the lessor is extended, by three months in each case, five and eight years after the lessee is permitted to use the residential space.
(2) For residential space that is only leased for temporary use, a shorter notice period may be agreed.
(3) For residential space under section 549 (2) no. 2, notice of termination is allowed at the latest on the fifteenth day of a month to the end of that month.
(4) An agreement deviating from subsections (1) or (3) to the disadvantage of the lessee is ineffective.
Section 573d
Termination for cause with the statutory notice period
(1) If a lease may be terminated for cause with the statutory notice period, then sections 573 and 573a apply with the necessary modifications, with the exception of notice of termination to the heirs of the lessee under section 564.
(2) Notice of termination is allowed at the latest on the third working day of a calendar month to the end of the second month thereafter, and in the case of residential space under section 549 (2) no. 2 at the latest on the fifteenth day of the month to the end of that month (statutory period). Section 573a (1) sentence 2 does not apply.
(3) A deviating agreement to the disadvantage of the lessee is ineffective.
Section 574
Objection of lessee to termination
(1) The lessee may object to the notice of termination of the lessor and demand continuation of the lease from the latter if termination of the lease would be, for the lessee, his family or another member of his household, a hardship that is not justifiable even considering the justified interests of the lessor. This does not apply if a reason exists that entitles the lessor to terminate the lease for cause without notice.
(2) Hardship also exists if appropriate substitute residential space cannot be procured on reasonable terms.
(3) When the justified interests of the lessor are considered, only the reasons given in the letter containing notice of termination under section 573 (3) are taken into account, except where the reasons arose subsequently.
(4) A deviating agreement to the disadvantage of the lessee is ineffective.
Section 574a
Continuation of lease after objection
(1) In the case of section 574, the lessee may demand that the lease is continued as long as is appropriate if all circumstances are taken into consideration. If the lessor cannot reasonably be expected to continue the lease under the previously applicable contract terms, then the lessee may only demand that it is continued with an appropriate amendment of the terms.
(2) If no agreement is reached, then the continuation of the lease, its duration and the terms under which it is continued are determined by judicial decision. If it is uncertain when the circumstances can be expected to cease on the basis of which termination of the lease would be a hardship, then it may be specified that the lease is to be continued for an indefinite period of time.
(3) A deviating agreement to the disadvantage of the lessee is ineffective.
Section 574b
Form and period of objection
(1) An objection of the lessee to termination must be declared in writing. Upon demand by the lessor, the lessee should without undue delay provide information on the reasons for the objection.
(2) The lessor may refuse continuation of the lease if the lessee does not declare the objection to him at the latest two months prior to termination of the lease. If the lessor has not referred to the possibility of objection and to its form and period in good time before the end of the period for filing an objection, then the lessee may declare his objection in the first hearing in the eviction proceedings.
(3) A deviating agreement to the disadvantage of the lessee is ineffective.
Section 574c
Further continuation of lease in the case of unforeseen circumstances
(1) If it has been determined on the basis of sections 574 to 574b by agreement or judicial decision that the lease is to be continued for a definite period of time, then the lessee may only demand its further continuation if this is justified by a material change in circumstances or if circumstances have not come about whose foreseen occurrence was decisive for the period of time the lease was to continue.
(2) If the lessor terminates a lease whose continuation for an indefinite period of time has been established by judicial decision, then the lessee may object to the termination and demand from the lessor continuation of the lease for an indefinite period of time. If the circumstances that were decisive for continuation have changed, then the lessee may demand continuation of the lease only under section 574; trivial changes are disregarded.
(3) A deviating agreement to the disadvantage of the lessee is ineffective.
Subchapter 3
Leases for a definite period of time
Section 575
Fixed-term lease
(1) A lease may be entered into for a fixed period of time if the lessor upon termination of the lease period
1. wishes to use the premises as a dwelling for himself, members of his family or members of his household, or
2. wishes, admissibly, to eliminate the premises or change or repair them so substantially that the measures would be significantly more difficult as a result of a continuation of the lease, or
3. wishes to lease the premises to a person obliged to perform services
and he notifies the lessee in writing of the reasons for the fixed term when the agreement is entered into. Otherwise the lease is deemed to have been entered into for an indefinite period of time.
(2) The lessee may at the earliest four months prior to expiry of the fixed term demand of the lessor that the lessor notify him within one month whether the grounds for the fixed term still apply. If the notification occurs later, then the lessee may demand an extension of the lease by the period of time of the delay.
(3) If the reason for the fixed term occurs later, then the lessee may demand an extension of the lease by an equivalent period of time. If the reason ceases, then the lessee may demand an extension for an indefinite period of time. The burden of proof for the occurrence of a reason for setting a fixed term and for the duration of the delay is on the lessor.
(4) A deviating agreement to the disadvantage of the lessee is ineffective.
Section 575a
Termination for cause with the statutory notice period
(1) If a lease entered into for a fixed term may be terminated for cause with the statutory notice period, then sections 573 and 573a apply with the necessary modifications, with the exception of notice of termination to the heirs of the lessee under section 564.
(2) Sections 574 to 574c apply with the necessary modifications subject to the proviso that the continuation of the lease may be demanded at most until the contractually specified date of termination.
(3) Notice of termination is allowed at the latest on the third working day of a calendar month to the end of the second month thereafter, and in the case of residential space under section 549 (2) no. 2 at the latest on the fifteenth day of the month to the end of the month (statutory period). Section 573a (1) sentence 2 does not apply.
(4) A deviating agreement to the disadvantage of the lessee is ineffective.
Subchapter 4
Tied dwellings
Section 576
Periods for notice of termination in the case of tied leased dwellings
(1) If residential space is leased in view of the existence of a service relationship, then the lessor may upon termination of the employment and notwithstanding section 573c (1) sentence 2 terminate the lease with the following notice periods:
1. for residential space the lessee has been permitted to use for less than ten years, at the latest on the third working day of a calendar month to the end of the second month thereafter if the residential space is needed for another person obliged to perform services;
2. at the latest on the third working day of a calendar month to the end of that month if the service relationship by its nature requires permission to use residential space that is located in immediate relation to or in the immediate vicinity of the place of work and the residential space is needed for the same reason for another person obliged to perform services.
(2) A deviating agreement to the disadvantage of the lessee is ineffective.
Section 576a
Special features of the right of objection in the case of tied leased dwellings
(1) When sections 574 to 574c are applied to tied leased dwellings, the interests of the person entitled to services must also be taken into account.
(2) Sections 574 to 574c do not apply if
1. the lessor has given notice under section 576 (1) no 2;
2. the lessee has terminated the service relationship without the person entitled to service giving him any legally justified reason for doing so, or the lessee, by his conduct, provided the person entitled to service with legally justified grounds for terminating the service relationship.
(3) A deviating agreement to the disadvantage of the lessee is ineffective.
Section 576b
Application of landlord and tenant law with the necessary modifications in connection with tied dwellings
(1) If permission to use residential space has been given in connection with a service relationship, then the termination of the legal relationship with regard to the residential space is governed by the provisions on leases with the necessary modifications if the person obliged to perform services has predominantly supplied the residential space with furniture and fixtures or lives in the residential space with his family or persons with whom he maintains a joint household set up permanently.
(2) A deviating agreement to the disadvantage of the lessee is ineffective.
Chapter 6
Special features when creating apartment ownership of leased residences
Section 577
Right of preemption of the lessee
(1) If leased residential premises, apartment ownership of which has been established or is to be established after the lessee has been permitted to use it, is sold to a third party, then the lessee has a right of preemption with regard to it. This does not apply if the lessor sells the residential premises to a member of his family or a member of his household. To the extent that the following subsections do not lead to a different conclusion, the right of preemption is governed by the provisions on preemption.
(2) The notification of the seller or of the third party on the contents of the purchase agreement is to be supplied together with information to the lessee on his right of preemption.
(3) The right of preemption is exercised by a written declaration of the lessee to the seller.
(4) If the lessee dies, then the purchase option passes to the persons who succeed to the lease under section 563 (1) or (2).
(5) A deviating agreement to the disadvantage of the lessee is ineffective.
Section 577a
Restriction on notice of termination in connection with conversion of the dwelling
(1) If apartment ownership of leased residential premises has been established in the residential space after the lessee was permitted to use it and the apartment ownership has been disposed of, then an acquirer may only invoke a justified interest within the meaning of section 573 (2) nos. 2 or 3 after the end of three years after the disposal.
(1a) The restriction on notice of termination in accordance with subsection (1) applies with the necessary modifications if rented residential space, after the lessee was permitted to use it,
1. has been sold to a partnership or to several purchasers, or
2. has been encumbered in favour of a partnership or several purchasers with a right through the exercise of which the lessee is deprived of use in accordance with the contract.
Sentence 1 is not to be applied if the shareholders or purchasers belong to the same family or to the same household, or if apartment ownership had been established prior to the lessee being permitted to use the residential space.
(2) The period under subsection (1) or under subsection (1a) is up to ten years if adequate supply of leased dwellings to the population on reasonable conditions in a municipality or part of a municipality is particularly jeopardised and these areas are specified under sentence 2. The Land governments are authorised to specify these territories and the period of time under sentence 1 by statutory order for the duration of ten years at most in each case.
(2a) If apartment ownership has been established subsequent to a sale or encumbrance within the meaning of subsection (1a), the period within which termination has been ruled out in accordance with section 573 (2) no. 2 or 3 already begins to run at the time of the sale or encumbrance in accordance with subsection (1a).
(3) A deviating agreement to the disadvantage of the lessee is ineffective.
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