By notarised contract of 11 October 1983, the defendants sold a building to the claimant. In the contract they assured him that they knew of no latent defects. Otherwise, "all guarantee for the constructual state" was excluded. The transfer took place in November 1983.

In 1987 the claimant noticed that damp occurred in the basement flat. After obtaining an expert report on the reasons for the damage, the claimant stated that the damp resulted from a lack of external insulation of the basement walls and that the defendant knew of this fact.

The claimant demanded from the defendant’s reimbursement of the costs for repairing the defects amounting to DM 62 160.50 and compensation amounting to DM 7, 800 for loss of use of the basement flat between July 1987 and August 1989.

The Landgericht has dismissed the action for payment of these amounts plus interest for reasons of joint and several liability. The Oberlandesgericht has granted the claim as to its main reasons and referred the matter back to the Landgericht for a decision as to the actual amount due. The defendants have brought a further appeal against this decision. The Senate accepted the second defendant's further appeal in full and that of the first defendant only insofar as it concerned a decision in respect of compensation for loss of use. To that extent the appeal was successful.

Reasons

I. The appeal court ascertained that the outer walls of the building were not insulated against damp and there was no drainage. The effects of this building defect were known to the first defendant. He deliberately failed to inform the claimant and in the contract made a false declaration. He is thus basically liable to pay damages for reasons of failing to disclose a defect with intent to deceive, as set out in para. 463, second sentence BGB.

The same liability applies in respect of the second defendant. It cannot be ruled out, that she knew of the occurrence of damp herself. In any case, under para. 166 BGB, the knowledge of the first defendant, her then husband, is attributable to her. It transpires from the "ample correspondence submitted" that it was he who conducted the sales discussions. In this context and also when making his statement in the contract to the effect that he knew of no hidden defects, he acted for himself and at the same time as agent for the second defendant.

As far as it was admitted, the further appeal successfully opposes this view.

II. Further appeal of the first defendant:

The appeal court has basically acknowledged the claim for compensation for loss of use resulting from defects, without taking into account the parties' submissions in respect of the person for whose use the separate flat was intended.

This is not free from error in law. According to the decision of the Great Senate for Civil Matters of the Federal Supreme Court of 9 July 1986 (BGHZ 98, 212), it can constitute an economic loss liable to compensation, where the owner of goods used by himself, in any case of a house lived in by himself, temporarily cannot make use of his property without incurring additional costs or loss of revenue because of a tortuous intrusion. As a consequence, this Senate held that where damages are claimed from a debtor who belatedly complies with his contractual duty to vacate a flat, the temporary deprivation of use of the flat (loss of enjoyment) is a monetary loss, where the premises are of vital importance for the life of the rightful owner and where he himself intended to occupy them (decision of 31 October 1986, VZR 140, 85, NJW [1987] 771. For the claim for damages for non-performance as here under consideration, the affirmation of a pecuniary damage depends on these preconditions. They are not part of the peculiarities of a debtor's default but are rather based on the considerations of the Great Senate for Civil Matters, i.e. that the acknowledgement of a damage for which compensation can be claimed for temporary loss of enjoyment must remain restricted to goods on whose constant availability the economic lifestyle of the owner/holder typically depends.

But the appeal court's error in law does not result in a referral back, since the case is ready for a final decision (paras 564, 565 (3) ZPO). The defendants have submitted that the separate flat had (as second domicile) exclusively been at the disposal of the claimant's adult son, living in B. The claimant has admitted this fact in its decisive point (paras 288, 289 ZPO), since he has acknowledged the alleged facts and merely added that the rooms could also have been used by visitors. Where the separate flat was thus intended to be used by a person who is not part of the household, it is not part of the goods whose constant availability is of vital importance for the claimant's personal economic lifestyle. The fact that the rooms were also held ready for the claimant's visitor and not only for the son does not alter this result.

Thus, the preconditions are not fulfilled under which the claimant can demand damages for loss of enjoyment of the separate flat and the appeal must insofar be rejected.

III. Further appeal of the second defendant:

1. Insofar as the second defendant, alongside the first defendant, is held liable for compensation for loss of enjoyment, the appeal is successful for the reasons as stated above under II.

Back to top

This page last updated Thursday, 01-Dec-2005 11:04:42 CST. Copyright 2007. All rights reserved.