Federal Court of Justice, April 30, 2014, Case No.: VIII ZR 284/13
One of the most common reasons for a landlord to terminate a rental agreement is personal need (Eigenbedarf). Since tenants can also invoke the constitutional guarantee of property ownership, just like the owner, the law places strict requirements on termination due to personal need, as outlined in Section 573, Paragraph 2, No. 2 of the German Civil Code (BGB).
Personal need generally exists when the landlord requires the rental apartment for themselves or for a member of their household, such as a caregiver, or for a family member for residential purposes.
Family members for whom a landlord can terminate a lease on the grounds of personal need include, for example, the landlord’s parents or children, grandchildren, or siblings. There is no specific degree of kinship required.
The validity of a termination based on personal need depends on whether the claimed personal need can be proven. The termination letter must include a justification explaining for whom the apartment is needed. Additionally, a specific situation must be described that supports the interest of this person in the apartment.
In the above-mentioned ruling by the Federal Court of Justice (BGH), the court once again had to decide on the requirements for justifying a termination due to personal need.
Facts and Background of the Case
The plaintiffs and landlords terminated the rental agreement with the defendants, who had lived in a 158-square-meter apartment since 1999, in 2012. The reason for the termination was that the plaintiffs‘ daughter, who had been living in an 80-square-meter apartment, needed the larger apartment to set up a household with her partner. Before the termination, the plaintiffs unsuccessfully negotiated with the defendants regarding a potential sale of the apartment. The defendants contested the termination, and the dispute escalated.
The district court initially ruled in favor of the eviction claim, but the regional court overturned this decision and dismissed the claim. It argued that the termination was formally invalid because the daughter’s partner was not mentioned by name in the termination letter. The plaintiffs then appealed to the Federal Court of Justice (BGH) to reinstate the district court’s ruling.
Decision of the Federal Court of Justice
The Federal Court of Justice sided with the plaintiffs, ruling that the appeal was successful. The BGH argued that the regional court had wrongly dismissed the eviction claim because the termination was formally valid. The regional court had found the termination invalid because the daughter’s partner was not named. However, according to the BGH, this was not necessary.
Requirements for Justifying a Termination Due to Personal Need
According to Section 573, Paragraph 3, Sentence 1 of the BGB, the landlord must state the reasons for a legitimate interest in terminating the lease in the termination letter. The purpose of this provision is to provide the tenant with early clarity about their legal position so that they can protect their interests. The BGH clarified that it is sufficient to specify the personal need in such a way that it is understandable and distinguishable from other reasons.
In the case of a termination due to personal need, this means that the person for whom the apartment is needed must be clearly identified, and the interest of this person must be explained in a way that is understandable. The BGH found that it was sufficient in this case to identify the plaintiffs‘ daughter as the person in need of the apartment and to explain that she wanted to set up a household with her partner in the larger apartment. Further details, such as the partner’s name, were not required.
Consequences of the Decision for Future Terminations Due to Personal Need
This ruling strengthens the position of landlords by clarifying the formal requirements for a termination based on personal need. The decision emphasizes that the main focus in a termination for personal need is that the reason for termination is clearly and understandably stated, allowing the tenant to base their defense on this reason. Additional details, such as the name of a partner, are not necessarily required as long as the essential reason for termination—the personal need—is evident. Landlords must ensure that the person concerned (in this case, the daughter) and the interest in the use of the apartment are sufficiently identified.
The BGH ruling emphasizes that a termination should not be considered invalid for formal reasons if the essential reason for the termination has been adequately stated. This judgment can serve as a guideline in similar cases and provides clarity regarding the requirements for termination notices under tenancy law.
Source: Federal Court of Justice
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