If Part B of the Standard Building Contract Terms provided by the client is not agreed as a whole in the construction contract, Section 16(3)(i) of Part B will not stand up to an isolated judicial examination of the terms. This means that the remuneration becomes due with acceptance and receipt of the final invoice. The client then falls into default at the latest 30 days after the final invoice.
The Federal Court of Justice has already held in a decision of August 20 2009 (VII ZR 212/07) that Section 16(5)(iii) of Part B of the Standard Building Contract Terms, which stipulates that the contractor must set the client a reasonable extension period before the client falls into default, is null and void under Section 307 of the Civil Code if the client uses Part B and the terms have not been agreed as a whole, and thus the client can fall into default at the latest 30 days after the acceptance and receipt of the final invoice, even without a warning. Now, the higher regional courts are increasingly ruling that Section 16(3)(i) of Part B does not stand up to an isolated judicial examination of the terms.
Section 16(3)(i) of Part B deviates from the statutory principle of Sections 641(1) and 286 of the code by stipulating that in spite of the acceptance and receipt of the final invoice, the contractor's remuneration for work rendered becomes due only two months after the receipt of the final invoice. Taking into account the above-mentioned ruling of the Federal Court of Justice, the client then falls into default at the earliest 90 days after the final invoice. In a ruling of July 26 1994 (13 U 1804/94) the Munich Higher Regional Court took the view that Section 16(3)(i) of Part B did not stand up to an isolated judicial examination of the terms under Section 307ff of the code. Now, two other higher regional courts have confirmed this opinion: the Celle Higher Regional Court in a ruling of December 18 2008 (6 U 65/08) and the Naumburg Higher Regional Court in a ruling of January 12 2012 (9 U 165/11). Section 16(3)(i) of Part B is invalid in an isolated examination under Section 307(2) of the code because the due date for the remuneration for work performed is moved to the detriment of the contractor, in deviation from the statutory principle in Sections 641(1) and 286 of the code. According to Section 306(2) of the code, the invalid provision is then replaced by the statutory provision so that the remuneration becomes due upon the acceptance and receipt of the final invoice.
The precedent of the Federal Court of Justice and the higher regional courts means that the client can fall into default with the payment of the final invoice 60 days earlier than under the provisions of Part B of the Standard Building Contract Terms. If it is not possible to check invoices within 30 days, as is often the case with large construction projects, the due date for the remuneration for work rendered and the resulting date of default can be postponed only by individual contractual provisions in the building contract.
For further information on this topic please contact Christian Felix Fischer at SIBETH Partnerschaft by telephone (+49 89 38 00 82 39), fax (+49 89 38 80 82 04) or email ([email protected]).