BGH: "Half and half" for cosmetic repairs
The Federal Court of Justice (BGH) decided in its judgements of 8 July 2020 (Ref. VIII ZR 163/18 and VIII ZR 270/18) that long-term tenants can oblige their landlord to renovate. However, the tenants must then contribute half of the costs. Another condition is that the condition of the flat has deteriorated significantly since moving in.
The judgments of the BGH concerned two cases from Berlin. These rulings are likely to be transferable to all dwellings that have been occupied in an unrenovated state (VIII ZR 163/18). The BGH initially confirmed that the transfer of cosmetic repairs to the tenants in form leases is ineffective because the tenants were each given an unrenovated flat and no appropriate financial compensation was paid to them for this. The BGH confirms its case law according to which in these cases the ineffective cosmetic repair clause is replaced by the landlord's statutory (§ 535 (1) sentence 2 BGB) maintenance obligation (cf. BGH of 18 March 2015, ref. VIII ZR 185/14, no. 15, no. 35, BGH of 22 August 2018, ref. VIII ZR 277/16, no. 20).
In one case (VIII ZR 163/18), the landlord let the tenants an unrenovated flat when the contract was concluded. As the condition of the flat decoration had deteriorated in the meantime from the tenants' point of view, they requested the landlord to have wallpapering and painting work carried out in accordance with an enclosed cost estimate. The action was unsuccessful.
In the other proceedings (VIII ZR 270/18), the tenant demanded that the landlord carry out specifically designated cosmetic repairs. The tenant had been given the flat in an unrenovated condition by his legal predecessor. More than 20 years after the transfer, the tenant requested the landlord to carry out painting work in the flat due to the poor state of renovation. This action was successful.
The BGH ruled that in cases where a "contractually agreed initial state" is required, the tenant may, on the one hand, demand that the landlord carry out a "fresh" renovation. On the other hand, the tenant must contribute to the costs required for this to a reasonable extent. As far as there is nothing special, this will regularly mean - according to the BGH - that the costs will be shared equally. If the Tenant requests (as in proceedings VIII ZR 270/18) that cosmetic repairs be carried out by the Landlord, the Landlord may object to the Tenant's contribution to costs in the form of a right of retention. If the Hirer demands payment of an advance on costs from the Owner who is in default with the performance of the work (as in proceedings VIII ZR 163/18), the appropriate cost sharing shall lead to a corresponding deduction from the expected costs.
Both proceedings were referred back by the BGH to the respective court of appeal, as further findings had to be made and the parties were given the opportunity to supplement their submissions and adjust their motions
