Case005: court acknowledged the validity of cancellation based on 2 months’ non-payment

C O N T E N T S

Judgement of the Tokyo District Court on March 25, 2009 (Case Number: 2008-WA-20322)

Tokyo District Court acknowledged the validity of cancellation of building lease contract based on 2 months’ non-payment.

Kamiogumi Co., Ltd. (lender) vs. M&S Co., Ltd. (tenant; a company operating dormitory for foreign students and introducing study abroad destinations)

In the lease contract, there was a special clause providing that the lender can cancel the contract without any demand if the tenant fails to pay the rent twice or more.
When the tenant did not pay the two-months’ rent, the lender demanded payment of the unpaid rent within 7 days. The tenant paid the rent of one month but could not pay remaining one-month rent, so the lender cancelled the contract after 7 days passed after the demand reached to the tenant.
The tenant argued that there was a security deposit of 11,400,000 yen. The tenant also argued that the tenant spent huge amount of money to renew the dormitory and there were 165 foreign students living there.
The court judged that the special clause cannot be deemed unlawful, and that particular circumstance did not exist that the non-payment did not dissolve the relationship of mutual trust between the parties of the lease agreement.

This is one of the cases of eviction that cancellation of building lease contract based on two months’ non-payment was acknowledged.

03/31/2021

04/05/2021