Termination of Lease Agreement: Step-by-Step Procedure
Termination of a lease agreement means that the agreement between landlord and tenant is terminated before the agreed end date is reached. This can occur by means of a notice of termination, an agreement between the parties or a court decision. The procedure varies depending on the situation and is governed by the **Lease Act 2015** and the **Dutch Civil Code (DCC)**. In this article, we explain step by step how you, as a tenant or landlord, can terminate a lease agreement, what rights and obligations you have, and what steps you need to take.
What is termination of a lease agreement?
Termination of a lease agreement means that the agreement between tenant and landlord is terminated before the original end date is reached. This can happen in various ways, for example:
- Due to force majeure: For example, in case of necessary renovation or if the tenant loses their job and can no longer pay.
- Due to fault of the other party: For example, if the landlord fails to maintain or the tenant does not pay rent.
- Agreement: If both parties agree to the termination.
- Judicial termination: If the court terminates the agreement at the request of one of the parties.
The procedure varies depending on the situation. In many cases, you must first issue a notice of termination and subsequently, if necessary, file a claim for termination with the court. The **Lease Act 2015** (Article 7:278 DCC) regulates the possibilities and conditions for termination.
Legal basis
The main legal grounds for termination of a lease agreement are:
- Dutch Civil Code (DCC), Book 7: Lease:
- Article 7:278 DCC: Termination by the landlord in case of non-payment of rent.
- Article 7:280 DCC: Termination by the tenant in case of defect in usability.
- Article 7:281 DCC: Termination in case of force majeure.
- Lease Act 2015:
- Article 7:290 DCC: Procedure for termination due to fault of the other party.
- Article 7:291 DCC: Procedure for termination due to force majeure.
When is termination possible?
Termination is possible in various situations. Below is an overview of the most common cases:
| Situation | Legal basis | Who can terminate? |
|---|---|---|
| Non-payment of rent (2+ months arrears) | Article 7:278 DCC | Landlord |
| Defect in usability (e.g., poor maintenance) | Article 7:280 DCC | Tenant |
| Force majeure (e.g., necessary renovation) | Article 7:281 DCC | Landlord |
| Breach of lease agreement (e.g., unreasonable conduct) | Article 7:290 DCC | Landlord or tenant |
| Agreement (e.g., both parties want to end) | Article 7:270 DCC | Both parties |
Step-by-step plan: how do you terminate a lease agreement?
The procedure for termination depends on the situation. Below are the most common steps for the main cases.
1. Termination by the landlord (in case of non-payment)
If the tenant does not pay rent, the landlord can terminate the agreement. This proceeds in several steps:
- Establish arrears: The landlord must first establish that there is an arrears of two or more months rent.
- Notice to pay: The landlord must call upon the tenant in writing to settle the arrears within 14 days (Article 7:278 paragraph 2 DCC).
- Notice of termination: If the tenant does not pay, the landlord can issue a notice of termination. This must be in writing and clearly state the reason for termination.
- Claim for termination: If the tenant still does not pay after the notice of termination, the landlord can file a claim for termination with the district court judge.
- Court decision: The court decides whether the lease agreement is terminated. If the court rules in favor, the agreement ends on the date set by the court.