Is there also a consumer construction contract if the developer transfers different crafts to individual craft companies for new construction? The question of whether there is a consumer contract or not becomes relevant, eg if the craft company requires security or a bank guarantee from the customer for outstanding invoice amounts in a dispute over payment for the services provided. Because in the case of a consumer contract, the craft company is not entitled to a deposit from the customer according to the applicable legal situation. The Higher Regional Court of Zweibrücken has now delivered its judgment of 29 March 2022 (Az. 5 U 52/21) a developer couple and decided that a consumer construction contract must also be required if the trades are awarded individually. Read the legal tip below to find out exactly what the ruling was about and how builders can protect themselves contractually.
The case first came before the Landau district court because a craftsman company was arguing with a couple who own the building contractors over the position of a builder’s insurance company. The builders were dissatisfied with the quality of the construction work and then refused to pay the remaining amount of around 8,000 euros. The construction company then demanded security for the outstanding, for example in the form of a bank guarantee. However, the builders rejected and believed that there was a consumer contract. And in this case, an exception applies under the German Civil Code, according to which there is no right to such security. The High Court in Landau saw things differently and convicted the client couple. The couple found the verdict unreasonable and appealed it. With success!
Typically, private builders award the contract to a single turnkey contractor, who then performs the contract work for the builders themselves or through subcontractors. In many cases, however, the builders also decide to assign the craftsmanship to their house construction individually. The Higher Regional Court in Zweibrücken was now to rule on the hitherto controversial question whether the exemption from security for the benefit of the consumer also applies if the construction contracts are awarded by the client for different transactions to several different construction companies. The Higher Regional Court of Zweibrücken overturned the wrong decision of the Landau Regional Court and ruled clearly in favor of the client couple. The idea of consumer protection must mean that it should not make any difference whether the private developer lets the individual shop individually with different contractors, or whether a general contractor provides all the services from one source. The Higher Regional Court in Zweibrücken emphasized that it was not justified to put builders in a worse position, who awarded the construction work individually. Furthermore, if the law were applied differently, there would be a risk that builders and main contractors could circumvent consumer protection provisions by deliberately deleting certain services from the main contract, and building owners would be forced to award certain contracts separately. Even then, consumer protection must take effect.
The craft company has meanwhile appealed to the federal court. It is still unknown whether BGH will also side with the consumer.
Our tip: Contract provisions in the construction contract create security
It is unclear when the Federal Court will finally rule on the controversial issue of the existence of the consumer’s construction contract. We therefore recommend that builders without a turnkey contractor who want to order individual trades from different construction contractors always, as a precautionary measure, always include an explicit clause in the construction contract, after which the client and craftsman agree that it is a consumer building. contract and that the corresponding rules must be applied.
We are happy to assist affected builders who need advice in this regard, with the preparation of a contract and a review of the client’s contract. We are also happy to advise builders who are in the same or similar situation as the couple in the case decided by OLG Zweibrücken on their rights and provide legal support to enforce them. We look forward to your contact.