Approval of deviating clauses

Approval of deviating clauses

When there is a lease of business premises within the meaning of Article 7:290 of the Dutch Civil Code, a number of provisions have been established by law from which the landlord cannot, in principle, deviate to the detriment of the tenant. However, in some cases, both the landlord and the tenant wish to deviate from these statutory provisions in the lease agreement. A clause contrary to the statutory regulations is, in principle, voidable. To prevent voidable clauses from being included in the lease agreement, the tenant and landlord may request judicial approval of the deviating clauses.

If the court approves these deviating clauses, the tenant can no longer invalidate the clause. First, when granting approval for a deviating clause, the court assesses whether the rights the tenant derives from the statutory regulations are not substantially impaired. In addition, the court considers whether the social position of the parties is sufficiently equivalent so that the tenant does not require statutory protection.

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Legal framework: semi-mandatory tenancy law for commercial premises

A system of semi-mandatory law applies to the lease and rental of commercial premises for small and medium-sized enterprises (shops, hospitality establishments, takeaway businesses, and craft businesses) within the meaning of Article 7:290 of the Dutch Civil Code. Article 7:291, paragraph 1, of the Dutch Civil Code stipulates that parties may not deviate to the detriment of the lessee from the provisions of Section 6, Title 4 of Book 7 of the Dutch Civil Code (Articles 7:290 to 7:310 inclusive). This concerns, among other things, statutory lease terms (Article 7:292), protection against termination and cancellation (Articles 7:293 to 7:296 inclusive), rent revision (Article 7:303 inclusive), and substitution (Article 7:307 inclusive). If a clause deviates to the detriment of the tenant from one of these provisions, that clause is voidable, unless the subdistrict court has approved it pursuant to Article 7:291 paragraph 2 of the Dutch Civil Code. This approval regime does not apply to “other business premises” within the meaning of Article 7:230a of the Dutch Civil Code (such as offices and warehouses); in that case, freedom of contract is the guiding principle. Our lawyers and in-house counsel will first determine for you the type of premises involved, so that you know whether approval is required at all.

The petition procedure before the subdistrict court

Approval of a deviating clause is obtained through a petition procedure before the sub-district court of the place where the leased property is situated. Pursuant to Article 7:291 paragraph 2 of the Dutch Civil Code, the petition may be submitted jointly by both parties, but also by one of them. In practice, the landlord and tenant often submit the petition together, as they both have an interest in a legally valid clause. The sub-district court assesses the petition on its merits and is not bound by the wishes of the parties: even in the case of a joint petition, the judge independently verifies whether the statutory grounds have been met. We draft the petition, substantiate why the deviating clause is justified, and guide you through to and including the oral hearing.

The two grounds for approval under Article 7:291 paragraph 3 of the Dutch Civil Code

The subdistrict court grants approval pursuant to Article 7:291, paragraph 3 of the Dutch Civil Code only if the clause does not substantially impair the rights the tenant derives from Section 6, or if the social position of the tenant relative to that of the landlord is such that the tenant does not reasonably require statutory protection. In case law, both grounds are weighed in conjunction, taking into account all circumstances of the case. In doing so, the judge considers, among other things, the nature of the tenant (a small independent business owner or a large, professional party), the nature of the landlord (professional or operating nationally), whether the tenant sought legal assistance when concluding the agreement, whether the tenant is dependent on the landlord, and the tenant's experience with renting. This assessment differs for a branch of an international concern compared to the baker on the corner renting his first premises—and it is precisely this consideration that makes expert substantiation valuable.

Examples of deviating clauses

Deviating clauses for which approval is sought in practice include, for example: a shorter or longer lease term than the statutory five-plus-five-year term of Article 7:292 of the Dutch Civil Code, a deviating or extended termination arrangement, the exclusion or limitation of the rent revision of Article 7:303 of the Dutch Civil Code, and the exclusion of substitution of parties under Article 7:307 of the Dutch Civil Code. Whether approval is required for a specific clause depends on whether it deviates from a semi-mandatory provision to the detriment of the tenant. Clauses that are actually more favorable to the tenant, or that deviate from regulatory law, do not require approval.

Timing: request approval both beforehand and afterwards

There is no statutory time limit for the request for approval. Preferably, approval is requested before or shortly after the conclusion of the lease agreement, so that the parties have certainty from the outset. Nevertheless, approval is not ruled out if that moment has passed: the Supreme Court ruled in its judgment of 3 April 2015 (ECLI:NL:HR:2015:823) that judicial approval can still be obtained even after the clause has been annulled by the tenant. At the same time, lower court jurisprudence shows that timing can indeed go wrong: if a deviating lease term is only agreed upon or signed after a statutory period has already expired, a request submitted too late may be declared inadmissible. It is therefore advisable to arrange the approval in a timely and careful manner.

What if the approval was forgotten?

In practice, judicial approval is frequently overlooked. The deviating clause is then not automatically void, but voidable: it remains valid until the tenant invokes annulment. This poses a risk for the landlord, as the tenant can often invoke voidability for years to come and thus circumvent the clause. For the tenant, however, forgetting to obtain approval can actually be an opportunity. We assess for both landlords and tenants whether a clause is legally valid, whether annulment is possible, and whether approval can still be sought.

FAQ regarding approval of deviating clauses

For which lease agreements is approval required? For deviating clauses to the detriment of the tenant in commercial premises for small and medium-sized enterprises within the meaning of Article 7:290 of the Dutch Civil Code. The approval regime does not apply to other business premises (Article 7:230a of the Dutch Civil Code).

Who can request approval? Pursuant to Article 7:291 paragraph 2 of the Dutch Civil Code, the tenant and the landlord may submit a request to the subdistrict court jointly or separately.

Is approval also possible retroactively? Yes. There is no time limit, and according to the Supreme Court (ECLI:NL:HR:2015:823), approval can still be obtained even after annulment. Nevertheless, arranging this in a timely manner is strongly recommended.

What happens without approval? The deviating clause is voidable; it remains valid until the tenant invokes annulment.

Part of our tenancy law

Approval of deviating clauses is a specialized area of ​​Tenancy Law. Our mixed teams of lawyers and in-house counsel assist both landlords and tenants — from international corporations to the baker on the corner. Whether it concerns drafting a deviating clause, handling the approval request, or assessing the risk of annulment: contact us to discuss the possibilities.