No Consumer Construction Contract in the Case of a Contract for a Single Trade of a New Construction Project

Ruling of March 16, 2023 – VII ZR 94/22

On March 16, 2023, the VII Civil Senate of the Federal Court of Justice, which is primarily responsible for legal disputes regarding contracts for work and services, ruled for the first time on the requirements of a consumer construction contract within the meaning of Section 650i BGB, which came into force on January 1, 2018.

The defendant couple, as private builders, had a new building constructed, whereby they awarded the necessary trades to various building contractors.

The plaintiff provided its services on the basis of a contract for the execution of interior and exterior plastering work on a unit price basis. The defendants made payments of € 20,337.61 on partial invoices amounting to € 29,574.80.

Thereupon, the plaintiff unsuccessfully demanded payment of the outstanding amount from the defendants, setting a deadline, and subsequently demanded that the defendants provide security for this in the amount of € 9,880.05 within the meaning of Section 650f (1) sentence 1 BGB (builder’s warranty).

The Regional Court[1] upheld the claim for security. The defendants appealed against this decision. After the defendants had paid an amount of € 9,880.05 to the plaintiff, the plaintiff declared the legal dispute to be settled in the main proceedings. The defendants objected to the declaration of settlement.

The Higher Regional Court[2] dismissed the action now seeking a declaration that the main action had been settled.

In its opinion, the original action for the provision of security was unfounded, as the claim pursuant to Section 650f (1) BGB was precluded by the exceptional circumstances of Section 650f (6) sentence 1 no. 2 case 1 BGB. The present contract was a consumer construction contract pursuant to Section 650i (1) case 1 BGB, where the defendants appear as consumers within the meaning of Section 13 BGB.

In its line of reasoning, the Higher Regional Court assumed that the present contract was for construction services.

The plaintiff’s subsequent appeal to the BGH was successful!

The competent civil senate overturned the appeal judgment and determined that the legal dispute had been settled on the merits.

The original action for security was well-founded and has been settled. The exceptional circumstance of Section 650f (6) Sentence 1 Br. 2 Case 1 BGB does not apply. There is no consumer construction contract between the parties within the meaning of Section 650i BGB.

It is true that this is a contract between a consumer on the defendant’s side and a contractor on the plaintiff’s side. However, according to the wording of Section 650i (1) case 1 BGB, it is still necessary for the existence of a consumer construction contract that it concerns the “construction of a new building”. It is not sufficient for the contractor to be obliged to perform a single work as part of the construction of a new building.

In this respect, the provision differs significantly from Section 650a BGB, which came into force at the same time. This expressly covers, among other things, a contract for the construction of a building “or a part thereof”. A further terminological deviation in the law can be found in section 634a (1) no. 2 BGB, which refers to the broader term “building” and therefore individual trades can also be subsumed under this. However, the terminology in Section 650i BGB is a deliberate deviation by the legislator from the definitions in the aforementioned provisions. The exception in Section 650f (6) sentence 1 no. 2 case 1 BGB cannot be applied accordingly to contracts for individual trades in the context of the construction of a new building due to the lack of an unintended gap in the law.

[1] LG Landau in der Pfalz – Ruling from March 11, 2021 – 2 O 315/19.

[2] OLG Zweibrücken – Ruling from March 29, 2022 – 5 U 52/21 (BauR 2022, 1346).