On Aug. 27, the Osaka High Court reversed a ruling by the Kyoto District Court that found in favor of the defendant in a civil case brought by a tenant who thought the renewal fee stipulated in his rental agreement was unfair. It was the second verdict in a month in the Kansai region regarding renewal fees that found in favor of tenants. Not long after, a group calling itself The Association to Consider the Issue of Rental Condominium Contract Renewal Fees posted a message on its blog stating its position in the case and that it would appeal the High Court ruling.
In this particular case, the renter had to pay a contract renewal fee every year that amounted to twice his monthly rent. The judge basically said that if the fee is considered rent, then it should be incorporated into the monthly rent, otherwise it becomes an indefensible burden on the renter.
After the jump, the main points of the association’s post.
-“This ruling is unjust in that it invalidates the practice of charging contract renewal fees based on a biased view of ‘consumer protection’.”
-“The unfair ruling does not take into consideration the situation of the lender (landlord), the other party in the rental agreement.”
-“The practice of charging a contract renewal fee has a history of more than 40 years, and the national welfare budget allows for assistance to pay for renewal fees.”
-“The renewal fee is explained clearly in the contract as a condition for renting.”
-“When the renter signs the contract, he decided to live in the property with full knowledge of this condition. There is no failure in protecting the rights of the consumer.”
-“In judging the validity of the renewal fee, the court must take into consideration the circumstances of the lender (landlord), who receives the fee as a form of revenue after granting the tenant the right to occupy the property because he will honor the contract.”
-“The court’s ruling that the renewal fee term violates Article 10 of the Consumer Contract Law also undermines the validity of contracts, and thus improperly expands the meaning of the law. This is the point we will make when we appeal the verdict.”
More on this in detail in a later post.