Does an agreed rent indexation always apply?
Many entrepreneurs were confronted with a significant rent increase at the beginning of this year. This was because in many lease agreements for commercial space the annual rent increase is linked to the inflation rate. A rent increase of between 10 and 14 percent was therefore not unusual. This led and still leads to a lot of discussion between tenants and landlords. In a matter recently submitted to the preliminary relief judge of the District Court of The Hague (May 4, 2023, ECLI:NL:RBDHA:2023:8786), the judge came to the conclusion that the rent increase of 14.5% was unrealistically high.
The judge reached this decision partly in view of the fact that CBS will apply a new method to measure energy prices for consumers from June 2023. As a result, a significant adjustment will be made to Statistics Netherlands’ CPI. Statistics Netherlands indicates that the CPI and inflation results published until June 2023 will not be revised. According to the judge, the fact that CBS would only apply the new method from June 2023 does not mean that the old method must still be used for the period preceding that.
The judge ruled that a rental price indexation based on the change in the CBS CPI could not be increased. The rent increase was unrealistically high.
The rental agreement stated that the rent was indexed annually in accordance with the commonly used indexation clause. The indexation was based on the change in the CPI of Statistics Netherlands. On this basis, the rent would be increased by 14.5% with effect from January 1, 2023. However, the tenant refused to pay this increase. The landlord has therefore summoned the tenant.
Statistics Netherlands had meanwhile announced that it had adopted a new calculation method for rent indexation, as a result of which a lower percentage would apply from June 2023. On this basis, the judge ruled that a rent increase from January 1, 2023 based on the then applicable CPI of Statistics Netherlands is not realistic. According to the court, it is sufficiently plausible in advance that the application of the old calculation method as of 1 January 2023 has led to an excessively high, unrealistic price index figure.
The landlord’s claim to increase the rent on the basis of indexation based on the change in the CBS CPI was rejected by the court.
It follows from this ruling that an agreed rent indexation is not inviolable, despite the fact that it has been agreed in black and white. This ruling therefore offers opportunities to enter into discussions with your landlord (again or after all) to arrive at a reasonable rent increase. We are of course happy to assist you in this.
mr. M. (Maaike) Munnik – franchise lawyer
Ludwig & Van Dam Franchise attorneys , franchise legal advice. Do you want to respond?
Go to munnik@ludwigvandam.nl
Ludwig & Van Dam lawyers, franchise legal advice.
Do you want to respond? Then email to munnik@ludwigvandam.nl
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