The Federal Court of Justice (Bundesgerichtshof), in implementing a judgment of the Court of Justice of the European Union on the interpretation of 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 EC No. L 171 p. 12; Consumer Sales Directive), ruled on the scope of the obligations incumbent on the seller in the case of subsequent performance under § 439 (1) BGB* as well as on the scope of the defence of disproportionality to which the seller is entitled under § 439 (3) BGB*.
The plaintiff purchased floor tiles from the defendant, who runs a building materials trade, at a price of € 1,191.61 net. After he had the tiles laid in his residential building, defects became apparent which could not be remedied. The plaintiff therefore demanded that the defendant deliver new tiles and pay the costs for the removal of the defective tiles and the installation of new tiles in the amount of €5,830.57.
The Regional Court granted the claim for a reduction of €273.10 - which was not asserted by the plaintiff - and dismissed the remainder of the claim. On the plaintiff's appeal, the Higher Regional Court ordered the defendant to deliver new tiles and to pay the removal costs in the amount of € 2,122.37. The plaintiff's appeal was mainly successful. The defendant's appeal against this was mainly successful.
Initially, the VIII Civil Senate of the Federal Court of Justice, which is responsible, among other things, for the law of sales, had suspended the proceedings by order of 14 January 2009. Civil Senate of the Federal Court of Justice suspended the proceedings by order of 14 January 2009 and referred two questions to the Court of Justice of the European Union for a preliminary ruling. On the one hand, it had to be clarified whether Art. 3 para. 2 and para. 3 of the Sale of Consumer Goods Directive** is to be interpreted to the effect that, in the case of a replacement delivery, the seller must bear the costs of removing the defective consumer good from an item into which the consumer has incorporated it in accordance with its nature and intended use. Secondly, it should be clarified whether a national provision such as § 439 (3) BGB*, which allows the seller of a defective object of sale to refuse the type of subsequent performance chosen by the buyer (cf. § 439 (1) BGB*) if it would cause him costs that would be (absolutely) disproportionate compared to the value of the non-defective object and the significance of the defect, is in line with the Consumer Sales Directive (Press Release No. 8/2009).
The Court of Justice of the European Union ruled on this by judgment of 16 June 2011 and answered the questions referred as follows:
"Article 3(2) and (3) of 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". On a proper construction of Article 3(2) and (3) of 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, where a consumer good which was installed in good faith by the consumer in accordance with its nature and purpose before the defect arose is brought into conformity with the contract by replacement, the seller is under an obligation either to remove that good himself from the product in which it was installed or to replace it with a new one, the seller is obliged either to remove the goods from the goods into which they have been incorporated and to incorporate the replacement goods into them or to bear the costs of such removal and incorporation of the replacement goods. This obligation of the seller exists irrespective of whether he had undertaken in the contract of sale to install the consumer goods originally purchased.
Art. 3 para. 3 of Directive 1999/44/EC must be interpreted as precluding national legislation from conferring on the seller the right to refuse to replace a consumer good which is not in conformity with the contract, as the only possible form of remedy, on the ground that, because of the obligation to remove that consumer good from the goods into which it has been incorporated and to install the consumer good supplied as a replacement in those goods, it would entail costs for the seller which, compared with the value of the consumer good if it had been replaced, would be too high, into which it has been incorporated and the incorporation into that product of the product supplied as a substitute, it would entail costs which would be disproportionate to the value of the product if it were in conformity with the contract and to the importance of the lack of conformity. However, Article 3(3) does not preclude the consumer's right to reimbursement of the costs of removing the defective consumer goods and installing the replacement consumer goods in such a case from being limited to the payment by the seller of a reasonable amount."
The Federal Supreme Court has now ruled that § 439 para. 1 alt. 2 BGB* is to be interpreted in conformity with the Directive to the effect that the variant of supplementary performance referred to therein "delivery of a defect-free item" also covers the dismantling and removal of the defective purchased item. The right granted to the seller in § 439 (3) sentence 3 BGB* to refuse subsequent performance due to (absolutely) disproportionate costs is to be limited in the case of the sale of consumer goods (§ 474 (1) sentence 1 BGB) by way of further development of the law in conformity with the Directive to the effect that the seller's right of refusal does not exist if only one type of subsequent performance is possible or the seller justifiably refuses the other type of subsequent performance. In such cases, the seller's right to refuse subsequent performance in the form of replacement delivery on the grounds of disproportionate costs shall be limited to the right to refer the buyer to the reimbursement of costs in the amount of a reasonable sum with regard to the removal of the defective object of sale and the installation of the object of sale delivered as a replacement. In assessing this amount, the value of the item in a defect-free condition and the significance of the defect shall be taken into account. However, the restriction to cost sharing by the seller must not lead to the undermining of the buyer's right to reimbursement of the costs of removal and installation.
* § 439 BGB: Supplementary performance
(1) The purchaser may demand, as subsequent performance, at his discretion, the removal of the defect or the delivery of a defect-free item.
(2) The Seller shall bear the expenses necessary for the purpose of subsequent performance, in particular transport, travel, labour and material costs.
(3) The seller may refuse the type of supplementary performance chosen by the buyer without prejudice to section 275 subs. 2 and 3 if it is only possible at disproportionate cost. In particular, the value of the item in a defect-free condition, the significance of the defect and the question of whether the other type of subsequent performance could be resorted to without significant disadvantages for the buyer shall be taken into account. In this case, the buyer's claim is limited to the other type of supplementary performance; the seller's right to also refuse this under the conditions of sentence 1 remains unaffected.
(4) (...)
** Art. 3 ("Rights of the consumer")
°°(1) The seller is liable to the consumer for any lack of conformity existing at the time of delivery of the consumer goods.
2. In the event of lack of conformity, the consumer shall be entitled either to have the goods restored to conformity free of charge by repair or replacement in accordance with paragraph 3, or to a reasonable reduction in the price of the goods or to have the contract rescinded in respect of the goods in question in accordance with paragraphs 5 and 6.
(3. Initially, the consumer may require the seller to repair the consumer goods free of charge or to replace them free of charge, unless this is impossible or disproportionate.
A remedy shall be deemed disproportionate if it would cause the seller costs that would be (...) unreasonable compared to the alternative remedy.
The repair or replacement must be carried out within a reasonable time and without significant inconvenience to the consumer, taking into account the nature of the consumer goods and the purpose for which the consumer needed the consumer goods.
(4) (...)
Judgment of the BGH of 21 December 2011 - VIII ZR 70/08
Lower courts:
LG Kassel - Judgment of 24 November 2006 - 4 O 1248/06
OLG Frankfurt am Main - Judgment of 14 February 2008 - 15 U 5/07
(published in ZGS 2008, 315 = OLGR 2008, 325)
BGH - Decision of 14 January 2009 - VIII ZR 70/08 (published inter alia in NJW 2009, 1660)
ECJ - Judgment of 16 June 2011, Cases C-65/09 and C-87/09 - Gebr. Weber GmbH v Jürgen Wittmer and Ingrid Putz v Medianess Electronics GmbH (published inter alia in NJW 2011, 2269)
Source: Press release of the BGH
Goldberg Attorneys at Law 2011
Attorney at Law Michael Ullrich, LL.M. (Information Law)
Specialist lawyer for information technology law
E-mail: Info@goldberg.de
