Multiple terminations are permitted

With its ruling last autumn, the Federal Court of Justice strengthened landlords' rights. According to this ruling, an additional ordinary termination notice issued for rent arrears does not automatically become invalid if the tenant subsequently pays their debts.

In Berlin, a tenant was two months behind on rent, prompting the landlord to terminate the lease without notice. Knowing that a subsequent payment would invalidate the extraordinary termination, the landlord also issued a standard termination notice as a precaution.

The tenant contested the eviction, arguing that he had paid the outstanding rent a few days after receiving the notice of termination, thus rendering it invalid. According to German law (§ 543 BGB), a termination without notice is ineffective if the tenant pays the rent in full within the grace period (two months after service of the eviction notice). Nevertheless, the landlord insisted on the tenant vacating the apartment.

The landlord sued, and the Pankow-Weißensee District Court ruled in his favor. The tenant then appealed – successfully: The Berlin Regional Court dismissed the landlord's claim. According to the judges, the justified termination without notice had been rendered moot by payment of the rent arrears within the grace period.

Termination “was ineffective”

Regarding the outstanding ordinary termination notice, the judges ruled that during the period between the receipt of the immediate termination notice and the receipt of the grace period payment, no valid lease agreement existed that could be terminated. Therefore, in the judges' opinion, the ordinary termination notice was ineffective.

The landlord refused to accept this ruling and appealed. Now the Federal Court of Justice has taken up the case – and reached a completely different verdict:

Subsequent payment of rent arrears can only render the extraordinary termination ineffective. However, the additional ordinary termination, by which the landlord expressed his intention to end the tenancy even if the extraordinary termination were invalid, remains valid in principle (see also BGH 16.02.2005, case no. VIII ZR 6/04).

"Serious breach of duty"

Now it is up to the Berlin Regional Court to examine whether the ordinary termination of the lease is sufficiently justified by the breach of duty of "default in payment". Whether the termination is then valid or not depends on whether the late rent payments constitute a "significant breach of duty" by the tenant within the meaning of Section 573 Paragraph 2 Number 1 of the German Civil Code (BGB).

Whether the interests of the landlord or the tenant are given greater weight depends on whether the tenant's reliability is generally in question and he has "culpably" violated his obligations, or whether the missed rent payments are due to an oversight or an unforeseen financial shortfall.

The regional court's decision is still pending.

Sources: dejur.org, juris.bundesgerichtshof.de, verbraucherschutz.tv, mietrecht-reform.de, n-tv.de, de.reuters.com, news.immowelt.de, anwalt24.de, augsburger-allgemeine.de, spiegel.de, sueddeutsche.de