BGH, Decision of February 24, 2010 – AZ: XII ZR 69/08 and Decision of May 4, 2011 – XII ZR 112/09

After the question of allocability of building management costs had not been clarified in high-court decisions for a long time, two additional German Federal Court of Justice (BGH) decisions are now available in this regard, following the fundamental decision of the BGH of December 9, 2009. The agreement on the allocation ist thus admissible even as general lease terms and conditions. However, when it comes to other costs such as center management costs, this needs to implemented very carefully.


The BGH had already decided in the earlier decision that a cost allocation clause for the costs of technical and commercial building management in a commercial lease agreement was neither surprising nor unreasonably discriminatory and therefore generally permitted also as general lease terms and conditions. The Court found, inter alia, that the costs have to remain within what is locally customary and necessary. In the decided case, the BGH considered costs in an amount of 5.5 percent of the gross rent to be customary without requiring that this maximum amount is stated explicitly in the contract. A discrepancy from the amount of the prepayment does not necessarily lead to a different interpretation. In respect to terminology, the BGH ruled that the cost item “management costs” constitutes an agreement only on the items defined in Section 1 paragraph 2 no. 1 of the Operating Costs Directive (BetriebskostenVO): these are the costs of the workforce and facilities needed to manage the building, the supervision costs, the value of the management work carried out personally by the landlord, the costs of statutory or voluntary audits of the annual financial statements, and the costs of the corporate management. Additional costs cannot be allocated without an additional agreement, even if they are invoiced to the landlord in the specific case by the management company contracted by him.

The BGH continued this practice in its decisions of February 24, 2010 (AZ: XII ZR 69/08) and of May 4, 2011 (XII ZR 112/09) and also dealt with the argument there that in commercial leasing, additional cost items the legal definition of the Operating Costs Directive usually come up during the management. The BGH further specified in its decision of 24 February that the definition in the Operating Costs Directive alone is sufficient for determination of the term “management costs” and that these costs are also foreseeable at any rate. If additional cost items are at issue, however, a furtherreaching agreement is needed, and the landlord bears the risk of any vagueness in general lease terms and conditions provided by him.


By continuing its case law concerning the customariness of the management cost allocation, the BGH has further specified the legal framework conditions. At the same time, the Court has emphasized again that the foreseeability of the cost burden from the tenant's perspective is relevant, which means on the one side that this includes only cost items already described by the Operating Costs Directive or that a sufficiently clear contractual clause exists and on the other side that the locally customary and reasonable rates are decisive. Landlords are therefore well-advised to keep these conditions in mind, particularly if management costs are – as usual – allocated as part of the general lease terms and conditions.

The BGH did not have to decide in the above cases, whether the employed management companies may have charged other individual items than those defined by the Operating Costs Directive. Indications may be derived from the aforementioned decisions also in this respect. Strict attention should be paid to the fact that further-reaching costs may not include maintenance and that a sufficient stipulation exists in the lease agreement. According to the BGH, the term management costs is per se not generally able to cover all costs.

It becomes more clear that in such cases of general lease terms and conditions, an additional clarifying agreement needs to be implemented in light of the latest decision of the BGH of August 3, 2011 (AZ. XII ZR 205/09). The decision deals with the question whether the term “costs for a center manager” is sufficiently transparent and may thus be used as part of general lease terms and conditions. The Court has denied this based on the argument that it cannot be determined which single costs are comprised by this cost item. Such criteria as contractual accurateness or the possibility to refer to the locally customary or necessary costs are missing.