Last Updated on June 27, 2021 by LawEuro
German Civil Code (BGB) German law
Division 8
Particular types of obligations
Title 1
Purchase, exchange*)
*) Official note: This title serves to implement Directive 1999/44/EC of the European Parliament and of the Council of 25 May 1999 on certain aspects of the sale of consumer goods and associated guarantees (OJ 171, p. 12).
Subtitle 1
General provisions
Section 433
Typical contractual duties in a purchase agreement
(1) By a purchase agreement, the seller of a thing is obliged to deliver the thing to the buyer and to procure ownership of the thing for the buyer. The seller must procure the thing for the buyer free from material and legal defects.
(2) The buyer is obliged to pay the seller the agreed purchase price and to accept delivery of the thing purchased.
Section 434
Material defects
(1) The thing is free from material defects if, upon the passing of the risk, the thing has the agreed quality. To the extent that the quality has not been agreed, the thing is free of material defects
1. if it is suitable for the use intended under the contract,
2. if it is suitable for the customary use and its quality is usual in things of the same kind and the buyer may expect this quality in view of the type of the thing.
Quality under sentence 2 no. 2 above includes characteristics which the buyer can expect from the public statements on specific characteristics of the thing that are made by the seller, the producer (section 4 (1) and (2) of the Product Liability Act [Produkthaftungsgesetz]) or his assistant, including without limitation in advertising or in identification, unless the seller was not aware of the statement and also had no duty to be aware of it, or at the time when the contract was entered into it had been corrected in a manner of equal value, or it did not influence the decision to purchase the thing.
(2) It is also a material defect if the agreed assembly by the seller or persons whom he used to perform his obligation has been carried out improperly. In addition, there is a material defect in a thing intended for assembly if the assembly instructions are defective, unless the thing has been assembled without any error.
(3) Supply by the seller of a different thing or of a lesser amount of the thing is equivalent to a material defect.
Section 435
Legal defects
The thing is free of legal defects if third parties, in relation to the thing, can assert either no rights, or only the rights taken over in the purchase agreement, against the buyer. It is equivalent to a legal defect if a right that does not exist is registered in the Land Register.
Section 436
Public charges on plots of land
(1) Unless otherwise agreed, the seller of a plot of land is obliged to bear public services development charges and other municipal development charges for measures the construction of which began before the contract was entered into, irrespective of the point of time when they became payable.
(2) The seller of a plot of land is not liable for the land being free from other public levies and other public charges that are not suitable to be entered in the Land Register.
Section 437
Rights of buyer in the case of defects
If the thing is defective, the buyer may, provided the requirements of the following provisions are met and unless otherwise specified,
1. under section 439, demand cure,
2. revoke the agreement under sections 440, 323 and 326 (5) or reduce the purchase price under section 441, and
3. under sections 440, 280, 281, 283 and 311a, demand damages, or under section 284, demand reimbursement of futile expenditure.
Section 438
Limitation of claims for defects
(1) The claims cited in section 437 nos. 1 and 3 become statute-barred
1. in thirty years, if the defect consists
a) a real right of a third party on the basis of which return of the purchased thing may be demanded, or
b) some other right registered in the Land Register,
2. in five years
a) in relation to a building, and
b) in relation to a thing that has been used for a building in accordance with the normal way it is used and has resulted in the defectiveness of the building, and
3. otherwise in two years.
(2) In the case of a plot of land the limitation period commences upon the delivery of possession, in other cases upon delivery of the thing.
(3) Notwithstanding subsection (1) nos. 2 and 3 and subsection (2), claims become statute-barred in the standard limitation period if the seller fraudulently concealed the defect. In the case of subsection (1) no. 2, however, claims are not statute-barred before the end of the period there specified.
(4) The right of revocation referred to in section 437 is subject to section 218. Notwithstanding the fact that a revocation is ineffective under section 218 (1), the buyer may refuse to pay the purchase price to the extent he would be so entitled on the basis of revocation. If he makes use of this right, the seller may revoke the agreement.
(5) Section 218 and subsection (4) sentence 2 above apply with the necessary modifications to the right to reduce the price set out in section 437.
Section 439
Cure
(1) As cure the buyer may, at his choice, demand that the defect is remedied or a thing free of defects is supplied.
(2) The seller must bear all expenses required for the purpose of cure, in particular transport, workmen’s travel, work and materials costs.
(3) Without prejudice to section 275 (2) and (3), the seller may refuse to provide the kind of cure chosen by the buyer, if this cure is possible only at disproportionate expense. In this connection, account must be taken in particular, without limitation, of the value of the thing when free of defects, the importance of the defect and the question as to whether recourse could be had to the alternative kind of cure without substantial detriment to the buyer. The claim of the buyer is restricted in this case to the alternative kind of cure; the right of the seller to refuse the alternative kind of cure too, subject to the requirements of sentence 1 above, is unaffected.
(4) If the seller supplies a thing free of defects for the purpose of cure, he may demand the return of the defective thing in accordance with sections 346 to 348.
Section 440
Special provisions on revocation and damages
Except in the cases set out in section 281 (2) and section 323 (2), it is also not necessary to specify a period of time if the seller has refused to carry out both kinds of cure under section 439 (3) or if the kind of cure that the buyer is entitled to receive has failed or cannot reasonably be expected of him. A repair is deemed to have failed after the second unsuccessful attempt, unless in particular the nature of the thing or of the defect or the other circumstances leads to a different conclusion.
Section 441
Reduction of price
(1) Instead of revoking the agreement, the buyer may, by declaration to the seller, reduce the purchase price. The ground for exclusion under section 323 (5) sentence 2 does not apply.
(2) If more than one person comprises either the buyer or the seller, price reduction may be declared only by all or to all of them.
(3) In the case of a price reduction, the purchase price is to be reduced in the proportion in which the value of the thing free of defects would, at the time when the contract was entered into, have had to the actual value. To the extent necessary, the price reduction is to be established by appraisal.
(4) If the buyer has paid more than the reduced purchase price, the excess amount is to be reimbursed by the seller. Section 346 (1) and section 347 (1) apply with the necessary modifications.
Section 442
Knowledge of the buyer
(1) The rights of the buyer due to a defect are excluded if he has knowledge of the defect at the time when the contract is entered into. If the buyer has no knowledge of a defect due to gross negligence, the buyer may assert rights in relation to this defect only if the seller fraudulently concealed the defect or gave a guarantee of the quality of the thing.
(2) A right registered in the Land Register must be removed by the seller even if the buyer is aware of it.
Section 443
Guarantee
(1) Where the seller, the producer or some other third party enters into obligation, in addition to his statutory liability for defects, by way of making a declaration or in relevant advertising that was available prior to the purchase agreement being concluded or at the time of its conclusion, such obligation being in particular to reimburse the purchase price, to exchange the thing, to repair it or to provide services in this context should the thing not exhibit the quality or not fulfil other requirements than those concerning its freedom from defects, in each case as described in the declaration or in the relevant advertisement (guarantee), the buyer shall be entitled, in the case of a guarantee having been given, and notwithstanding his statutory claims, to the rights under the guarantee in relation to the person who has given the guarantee (guarantor).
(2) To the extent that the guarantor gives a guarantee as to the thing having a specified quality for a specified period (guarantee of durability), the presumption will be that a material defect which appears during the guarantee period triggers the rights under the guarantee.
Section 444
Exclusion of liability
The seller may not invoke an agreement that excludes or restricts the rights of the buyer with regard to a defect insofar as the seller fraudulently concealed the defect or gave a guarantee of the quality of the thing.
Section 445
Limitation of liability in the case of public auctions
If a thing is sold in exercise of a security right at a public auction in which it is described as a pledge, the buyer only has rights in respect of a defect if the seller fraudulently concealed the defect or gave a guarantee of the quality of the thing.
Section 446
Passing of risk and of charges
The risk of accidental destruction and accidental deterioration passes to the buyer upon delivery of the thing sold. From the time of delivery the emoluments of the thing accrue to the buyer and he bears the charges on it. If the buyer is in default of acceptance of delivery, this is equivalent to delivery.
Section 447
Passing of risk in the case of sales shipment
(1) If the seller, at the request of the buyer, ships the thing sold to another place than the place of performance, the risk passes to the buyer as soon as the seller has handed the thing over to the forwarder, carrier or other person or body specified to carry out the shipment.
(2) If the buyer has given a particular instruction on the method of shipping the thing and the seller, without a strong reason, does not adhere to this instruction, the seller is liable to the buyer for the damage arising from this.
Section 448
Costs of delivery and comparable costs
(1) The seller bears the costs of delivery of the thing, the buyer the costs of acceptance and of shipping the thing to a place other than the place of performance.
(2) The buyer of a plot of land bears the costs of the notarial recording of the purchase agreement and of the declaration of conveyance, the registration in the Land Register and the declarations necessary for registration.
Section 449
Retention of title
(1) If the seller of a movable thing has retained title until payment of the purchase price, then in case of doubt it is to be assumed that ownership is transferred subject to the condition precedent that the purchase price is paid in full (retention of title).
(2) Retention of title entitles the seller to demand the return of the thing only if he has revoked the agreement.
(3) An agreement on retention of title is void to the extent that the passing of ownership is made subject to the satisfaction by the buyer of third-party claims, including, without limitation, those of an enterprise associated with the seller.
Section 450
Excluded buyers in the case of certain sales
(1) When an object is sold by way of execution of judgment, the person instructed to carry out or manage the sale and the assistants used by him, including the recording clerk, may not purchase the object to be sold either for themselves in person or through another person or as the agents of another person.
(2) Subsection (1) above also applies to a sale other than by execution of judgment, if the order to sell the object has been given under a statutory provision authorising the principal to have the object sold for the account of another person, including, without limitation, sale of a pledge, sale authorised by sections 383 and 385, and sale from an insolvency estate.
Section 451
Purchase by excluded buyer
(1) The effectiveness of a purchase made in violation of section 450 and of the transfer of the object purchased is subject to the approval of the person taking part in the sale as obligor, owner or obligee. If the buyer requests a person taking part to make a declaration of ratification, section 177 (2) applies with the necessary modifications.
(2) If, as a result of refusal of ratification, a new sale is undertaken, the earlier buyer is liable for the costs of the new sale and for an amount by which the proceeds of sale are reduced.
Section 452
Purchase of a ship
The provisions in this subtitle on the sale of plots of land apply with the necessary modifications to the sale of registered ships and ships under construction.
Section 453
Purchase of rights
(1) The provisions on the purchase of things apply with the necessary modifications to the purchase of rights and other objects.
(2) The seller bears the costs of creation and transfer of the right.
(3) If a right comprising the right to possession of a thing is sold, the seller is obliged to deliver the thing to the buyer free of material and legal defects.
Subtitle 2
Special types of purchase
Chapter 1
Purchase on approval
Section 454
Coming into existence of the purchase agreement
(1) In a purchase on approval or on examination, approval of the object purchased is at the discretion of the buyer. In case of doubt, the purchase agreement is entered into subject to the condition precedent of approval.
(2) The seller is obliged to permit the buyer to examine the object.
Section 455
Approval period
An object purchased on approval or on examination may be approved only within the agreed period or, if no period has been agreed, only before the end of a reasonable period specified by the seller for the buyer. If the thing was delivered to the buyer for the purpose of approval or examination, his silence is deemed to be approval.
Chapter 2
Repurchase
Section 456
Coming into existence of the repurchase agreement
(1) If the seller has, in the purchase agreement, reserved the right of repurchase, the repurchase agreement comes into existence when the seller declares to the buyer that he is exercising the right of repurchase. The declaration is not subject to the formal requirements laid down for the purchase agreement.
(2) In case of doubt, the price at which the object was sold also applies to the repurchase.
Section 457
Liability of the reseller
(1) The reseller is obliged to return to the repurchaser the purchased object with its accessories.
(2) If the reseller, before exercising the right of repurchase, was at fault for the deterioration or destruction of the purchased object or an impossibility of returning it that resulted in another way, or if he materially altered the purchased object, he is liable for the damage resulting from this. If the object deteriorated without the fault of the reseller or if it is only trivially altered, the reseller may not require the purchase price to be reduced.
Section 458
Removal of third-party rights
If the original purchaser disposed of the purchased object before exercising the right of repurchase, he is obliged to remove the third-party rights created by this. A disposition that is made by execution of judgment or attachment or by the administrator in insolvency proceedings is equivalent to a disposition by the reseller.
Section 459
Reimbursement of outlays
The reseller may demand reimbursement for outlays that he made on the purchased object before the resale to the extent that the value of the object is enhanced by the expenses. He may remove an installation which he has attached to the returnable thing.
Section 460
Repurchase at estimated value
If the estimated value of the object purchased at the time of repurchase is agreed as the repurchase price, the reseller is not responsible for the deterioration or destruction of the purchased object or an impossibility of returning it that resulted in another way, and the repurchaser is not obliged to reimburse the outlays made.
Section 461
More than one person entitled to repurchase
If more than one person is jointly entitled to the right to repurchase, the right may only be exercised in its entirety. If it has expired for one of the persons entitled or if one of them does not exercise his right, then the others are entitled to exercise the right of repurchase in its entirety.
Section 462
Cut-off period
The right of repurchase may be exercised, in the case of plots of land, only before the end of thirty years from the date of the agreement of the reservation, and in the case of other objects, only before the end of three years from that date. If a period of time is specified for exercise of the right, this period replaces the statutory period.
Chapter 3
Preemption
Section 463
Requirements for exercise
A person entitled to the right of preemption in respect of an object may exercise the right as soon as the person obliged by it has entered into a purchase agreement relating to the object with a third party.
Section 464
Exercise of the right of preemption
(1) Exercise of the right of preemption occurs by declaration to the person obliged. The declaration is not subject to the formal requirements laid down for the purchase agreement.
(2) When the right of preemption is exercised, the purchase takes effect between the person entitled and the person obliged, subject to the terms that the person obliged agreed with the third party.
Section 465
Ineffective agreements
An agreement made by the person obliged with the third party which provides that the purchase is subject to the non-exercise of the right of preemption or which reserves for the person obliged the right to revoke the agreement in the event that the right of preemption is exercised is ineffective in relation to the person entitled to preemption.
Section 466
Collateral performance
If the third party has agreed in the contract to render an act of collateral performance which the person entitled to preemption is unable to perform, the person entitled to preemption must pay the value of the collateral performance instead of rendering it. If the collateral performance cannot be assessed in money, the exercise of the right of preemption is excluded; the agreement to render collateral performance is, however, not performed if the contract with the third party would have been entered into even without it.
Section 467
Total price
If the third party purchased the object which is subject to the right of preemption together with other objects at a total price, then the person entitled to preemption must pay a proportionate part of the total price. The person obliged may demand that the preemption is extended to all things that cannot be separated without disadvantage to him.
Section 468
Deferral of the purchase price
(1) If the third party is granted deferral of payment of the purchase price in the contract, the person entitled to preemption may claim the deferral only if he gives security for the amount deferred.
(2) If a plot of land is the subject matter of the preemption, there is no need to provide security to the extent that there has been an agreement to create a mortgage on the plot of land for the deferred purchase price, or a debt for which a mortgage on the land exists has been assumed and credited towards the purchase price. This applies with the necessary modifications if a registered ship or ship under construction is the object of the right of preemption.
Section 469
Duty to notify, exercise period
(1) The person obliged must inform the person entitled to preemption without undue delay of the contents of the contract entered into with the third party. Notice by the third party replaces notice by the person obliged.
(2) The right of preemption for plots of land may be exercised only before the end of a period of two months after notice is received, and the right of preemption for other objects only before the end of a period of one week after notice is received. If a period of time is specified for exercise of the right, this period replaces the statutory period.
Section 470
Sale to heir on intestacy
The right of preemption, in case of doubt, does not apply to a sale that is made to an heir on intestacy with a view to a future right of succession.
Section 471
Sale in case of execution of judgment or insolvency
The right of preemption is excluded if the sale occurs by way of execution of judgment or from an insolvency estate.
Section 472
More than one person with a right of preemption
If the right of preemption is held by more than one person jointly, it may be exercised only in its entirety. If it has expired with regard to one of the entitled persons or if one of them does not exercise his right, then the others are entitled to exercise the right of preemption in its entirety.
Section 473
Non-transferability
The right of preemption is not transferable and does not pass to the heirs of the person entitled to it unless otherwise provided. If the right is limited to a specific period, then, in case of doubt, it is inheritable.
Subtitle 3
Purchase of consumer goods
Section 474
The concept of sale of consumer goods; applicable provisions
(1) Sales of consumer goods are contracts by which a consumer buys a movable thing from a trader. A contract will likewise constitute a sale of consumer goods where its subject matter comprises, in addition to the sale of a movable thing, the provision of a service by the trader.
(2) The following rules of this subtitle have concomitant application for the sale of consumer goods. This does not apply to second-hand things that are sold at a publicly accessible auction which the consumer may attend in person.
(3) Where no period of time has been determined for the respective performance to be rendered pursuant to section 433 and none can be inferred from the circumstances given, the obligee may only demand the rendering of such performance, in derogation from section 271 (1), without undue delay. In this case, the trader must deliver the thing at the latest thirty days after the contract has been concluded. The parties to the contract may effect the respective performance immediately.
(4) Section 447 (1) applies subject to the proviso that the risk of accidental destruction and accidental deterioration shall devolve to the buyer only if the buyer has instructed the forwarder, carrier or other person or body tasked with carrying out the shipment and the trader has not named this person or body to the buyer previously.
(5) Section 439 (4) applies to the purchase contracts regulated by this subtitle subject to the proviso that benefits are not to be surrendered or substituted by their value. Sections 445 and 447 (2) do not apply.
Section 475
Deviating agreements
(1) If an agreement is entered into before a defect is notified to the entrepreneur and deviates, to the disadvantage of the consumer, from sections 433 to 435, 437, 439 to 443 and from the provisions of this subtitle, the entrepreneur may not invoke it. The provisions referred to in sentence 1 apply even if circumvented by other constructions.
(2) The limitation of the claims cited in section 437 may not be alleviated by an agreement reached before a defect is notified to an entrepreneur if the agreement means that there is a limitation period of less than two years from the statutory beginning of limitation or, in the case of second-hand things, of less than one year.
(3) Notwithstanding sections 307 to 309, subsections (1) and (2) above do not apply to the exclusion or restriction of the claim to damages.
Section 476
Shifting the burden of proof
If, within six months after the date of the passing of the risk, a material defect manifests itself, it is presumed that the thing was already defective when risk passed, unless this presumption is incompatible with the nature of the thing or of the defect.
Section 477
Special provisions for guarantees
(1) A declaration of guarantee (section 443) must be expressed simply and comprehensibly. It must contain
1. a reference to the statutory rights of the consumer and a statement that they are not restricted by the guarantee, and
2. the contents of the guarantee and all essential information required for asserting rights under the guarantee, including, without limitation, the duration and the area of territorial application of the guarantee protection as well as the name and address of the guarantor.
(2) The consumer may demand that the declaration of guarantee is given to him in text form.
(3) The effectiveness of the duty under the guarantee is not affected by the fact that one of the above requirements is not satisfied.
Section 478
Recourse of the entrepreneur
(1) If an entrepreneur has been obliged to take back a newly manufactured thing sold by him because it is defective, or if the consumer has reduced the purchase price, it is not necessary for the entrepreneur to fix the period of time which would otherwise be necessary in order to enforce the rights set out in section 437 with regard to the defect asserted by the consumer against the entrepreneur who sold the thing to him (supplier).
(2) Where a newly manufactured thing is sold, the entrepreneur may demand of his supplier reimbursement of the expenses which the entrepreneur had to bear in relation to the consumer under section 439 (2), if the defect asserted by the consumer already existed upon the passing of the risk to the entrepreneur.
(3) In the case of subsections (1) and (2) above, section 476 applies, subject to the proviso that the period begins when the risk passes to the consumer.
(4) The supplier may not rely on an agreement made before the defect was notified to the supplier which, to the disadvantage of the entrepreneur, deviates from sections 433 to 435, 437, 439 to 443 or from subsections (1) and (3) above or from section 479, if the obligee with the right of recourse is not given another form of compensation of equal value. Sentence 1, notwithstanding section 307, does not apply to an exclusion or restriction of the claim to damages. The provisions referred to in sentence 1 apply even if circumvented by other constructions.
(5) Subsections (1) to (4) above apply with the necessary modifications to claims of the supplier and of the other buyers in the supply chain against their sellers if the obligors are entrepreneurs.
(6) Section 377 of the Commercial Code [Handelsgesetzbuch] is unaffected.
Section 479
Limitation of recourse claims
(1) The claims to reimbursement of expenses specified in section 478 (2) are subject to a two-year limitation period after delivery of the thing.
(2) The claims specified in sections 437 and 478 (2) of the entrepreneur against his supplier for a defect in a newly manufactured thing sold to a consumer become statute-barred at the earliest two months after the date on which the entrepreneur satisfies the claims of the consumer. This suspension of expiry of limitation ends at the latest five years after the time when the supplier delivers the thing to the entrepreneur.
(3) The above subsections apply with the necessary modifications to claims of the supplier and the other buyers in the supply chain against their sellers if the obligors are entrepreneurs.
Subtitle 4
Exchange
Section 480
Exchange
The provisions relating to purchase apply with the necessary modifications to exchange.
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