The Amsterdam subdistrict court recently ruled in three cases that the agreed rent increase clause in residential premises was unfair. As the case concerned a rental agreement concluded with a consumer, the court had to test it ex officio against European and Dutch consumer law, in particular against Directive 93/13 EC (Unfair Terms Directive). As a result, the clause was annulled and past rent increases were reversed.
These rulings are causing alarm among landlords.
In a judgment dated 5 October 2023, the Amsterdam subdistrict court has now indicated its intention to submit 5 preliminary questions to the Supreme Court on the voidability of the rent increase clause.
Preliminary questions refer to questions of law from a judge to a higher court on the interpretation of a rule of law. A court may submit questions to the Supreme Court if an answer to these questions is necessary to decide the claim or application and is directly relevant to the resolution or termination of numerous other disputes arising from similar facts, in which the same question arises.
In two cases, one in which the tenant did not come forward and one in which the tenant did, the subdistrict court is going to ask the Supreme Court five questions. These questions concern the scope and consequences of the annulment of an unfair rent increase clause, including the possibility of splitting between the unfair and fair part in the clause, retroactive effect of the annulment, the possibility of setting off the rent increases paid against a claimed rent arrears, prescription or other possibility of limiting the recovery.
The questions are as follows:
1: If a rent increase clause provides partly for an increase under the statutory regime and partly for an additional rent increase that qualifies as unfair, should the clause be annulled in its entirety, or is only the unfair part voidable?
2: In the case of an unfair rent increase clause, does the liability for any increase lapse from the start of the lease and for the future?
3: If question 2 is answered in the affirmative, in proceedings such as the present, in which payment of rent arrears is claimed and a rent increase clause has been held to be unfair in the light of the principles of effectiveness and equivalence, should the court:
- limit itself to awarding rent instalments in the amount of the rent stipulated at the conclusion of the contract?
- or should it, in assessing the admissibility of the claimed rent instalments (and dissolution and eviction), also examine of its own motion whether an overpayment has been made since the beginning of the lease on the basis of the unfair term and assess whether on balance there is still a rent arrears for the entire lease period and, if not, reject the claims?
- if b is answered in the affirmative, should a landlord be given the opportunity to take a further deed to explain what rent was paid in excess of the initial rent over the entire period of the lease?
- Is it necessary to distinguish between adversarial cases and default cases for this purpose?
4: If questions 2 and 3(b) are answered in the affirmative, in proceedings such as the present one, in which payment of rent arrears is claimed and a rent adjustment clause is to be regarded as unfair, does the landlord have the option of invoking the limitation period for the repayment obligation and, if so, when does that limitation period commence?
5: or is there any other ground to place a limitation on the period over which the tenant can recover the rent increases wrongfully paid?
What is striking is that the subdistrict court's questions do not address its own earlier judgment of 26 September 2023 suggesting that tenants could be obliged to accept a fair alternative to an unfair term on the basis of good tenancy (Art. 7:213 of the Civil Code). huurders op grond van goed huurderschap (art. 7:213 BW) verplicht zouden kunnen worden een eerlijk alternatief voor een oneerlijk beding te aanvaarden.
It remains to be seen whether these will be the actual questions that will be put to the Supreme Court. Subsequently, it remains to be seen how the Supreme Court will answer these questions.
Would you like to know more or do you have questions about your position as a tenant or landlord? If so, please feel free to contact one of our lawyers without any obligation. We will be happy to assist you and keep you informed of further developments!