Facts
In this case, it concerned a rental contract between A. (tenant) and company B. (landlord) for a 10-room villa. The parties had agreed that the rent could be adjusted to the local and neighborhood market conditions upon the tenant's exercise of the option right. In the event that the parties could not agree on the rent adjustment, the decisive amount was to be determined by an expert opinion of the valuation department of the Zurich Homeowners' Association.
The tenant challenged the declared rent increase, whereupon the Federal Supreme Court partially overturned the contested decision and remanded the case to the lower court for reassessment.
Considerations
The Federal Supreme Court stated that according to Art. 361 para. 4 CPC, only the conciliation authority may be appointed as an arbitral tribunal in matters of rental and lease of residential premises. An agreement to delegate certain issues in dispute to a private third party as an expert appraiser is therefore inadmissible.
While the parties can generally dispose of disputed claims from the rental of residential premises, pursuant to Art. 361 para. 4 CPC, they are nevertheless…