The acceptance of the work performance plays a very central role in the law on contracts for work and services. Numerous very important legal consequences for both contracting parties are linked to it. This applies to simple contracts for individual trades all the way to property development contracts. For example, the contractor's claim to remuneration for work becomes due upon acceptance and the warranty period begins to run. The burden of presentation and proof for defects also shifts with acceptance. Until acceptance, the contractor must prove that he has performed the work free of defects. After acceptance, on the other hand, the client must prove that a defect that has occurred was caused by the contractor. This burden of proof is of great importance in practice. Finally, the risk of performance and remuneration is also transferred with the acceptance. This means that up to this point the contractor bears the risk of having to provide his service again completely without additional remuneration if it is lost through no fault of his own.
It is therefore not surprising that in practice the parties to the contract often argue about whether the contractor's performance has actually been effectively accepted. The contractor regularly has an interest in acceptance, especially since at this point his (remaining) remuneration for the work becomes due for payment by the client and the limitation period begins to run. The client, on the other hand, regularly defends himself against the contractor's claim for payment by stating that he has not yet accepted the contractor's performance due to defects and that he did not have to accept it. Frequently, however, the client only objects to minor defects and the question then arises with regard to § 640 paragraph 1 sentence 2 BGB whether the alleged defects actually entitle the client to refuse acceptance. This is because according to this provision, acceptance cannot be refused due to insignificant defects.
In a decision of 28 October 2020 (case no. 17 U 44/16), the Cologne Higher Regional Court (OLG) dealt with the question of when outstanding residual work on a building is so significant that it entitles the purchaser to refuse acceptance. Specifically, the case concerned the still missing cleaning, signage and labelling, missing sockets, etc. in a large condominium complex, which were recorded in writing in a protocol.
According to the OLG Cologne, these remaining works and defects are to be considered insignificant and minor in relation to the large condominium complex within the meaning of § 640 paragraph 1 sentence 2 BGB. Based on the perception of the market and the interest of the client in a defect-free work, the remaining work and defects were only insignificant impairments that could be eliminated at a low cost for the contractor in relation to the construction effort of the entire plant. Therefore, in the opinion of the OLG Cologne, the client could be expected to accept the contractor's work as essentially in accordance with the contract.
What may seem self-evident at first glance can actually lead to great difficulties in practice. This is because it always depends on a careful examination of the individual case as to whether defects and residual work are actually so significant that they entitle the buyer to refuse acceptance. Generalisations are not possible and also not advisable. A premature lawsuit initiated without sufficient legal examination can therefore - depending on the facts of the case - be associated with an enormous loss of time and money for both sides. Instead, it is advisable to examine the circumstances of the individual case very carefully in order to answer the question of whether the contractor's performance is actually ready for acceptance. We will be happy to advise you on this.
Author:
Axel Kötteritzsch, lawyer
Düsseldorf October, 15 2021
