A German court has ruled that leaseholders who transfer their contracts may not automatically remain liable for payments made by their successors. The Oberlandesgericht Frankfurt am Main decision centers on a case where a woman handed over her Mercedes CLA lease to her former roommate, who then stopped making payments.
The Takeover Agreement and the Disputed Clause
The case involved two former roommates. One had leased a Mercedes CLA. The other wanted to take over that contract and use the vehicle herself. Both signed an agreement with the leasing company to formalize the transfer. Buried in the general terms and conditions was a clause requiring the departing leaseholder to accept joint liability for all present and future obligations under the lease.
When the new leaseholder fell behind on payments, the leasing company turned to the original contract holder. The company argued she remained responsible for her former roommate’s arrears because of that clause. The Landgericht Frankfurt initially agreed, ordering her to pay roughly 20,000 euros in missed installments.
Why the Court Found the Clause Invalid
She appealed. The OLG Frankfurt reversed the decision entirely, rejecting the leasing company’s claim for the outstanding payments. The court found that the joint liability clause was “surprising” and therefore never became part of the contract. Under Section 305c of the German Civil Code, provisions in standard terms that are so unusual a reasonable person would not expect them do not bind the other party.
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The court reasoned that someone exiting a lease through a formal takeover agreement naturally expects to be fully released from obligations. They would not anticipate remaining on the hook for the new leaseholder’s conduct, particularly since they have no control over the vehicle or the ongoing contract. The contract itself used language suggesting a clean break: it was titled a “takeover agreement,” and the parties were labeled “previous leaseholder” and “transferee.”
Beyond its unexpected content, the clause failed to meet transparency standards. It was neither prominently highlighted nor visually separated from the rest of the contract text. The court determined it was designed to catch the departing leaseholder off guard. The ruling cannot be appealed further.
Situations where liability clauses slip into agreements without clear notice to all parties are not uncommon, and courts have consistently shown willingness to strike down terms that overreach. The outcome here reflects a broader principle: standard contract language must give signatories a fair chance to understand what they are agreeing to before signing.
The case serves as a reminder that anyone transferring a lease should read the takeover documents carefully and question any provision that seems to keep them in the picture after they have stepped out of it.