On 11 April 1953 two adjacent stressed concrete panels in the roof of the Siemens-Martin steel foundry in W fell some fifty to sixty feet to the ground and struck two persons working there. S, an engineer, was killed on the spot, leaving a widow and two orphans; L, a workman, was badly injured.
The roof had been constructed by the defendant between October 1952 and March of the following year. The old framework of the roof had been retained, but the one-piece concrete skin was replaced by the stressed concrete panels which the defendant had developed. The plaintiff, as statutory insurer, paid L and the dependants of S, and now claims an indemnity, based on tort and on positive breach of contract (paras 328, 618 BGB, in connection with para. 1542 RVO (Imperial Insurance Ordinance)).
The defendant denies that its work under the building contract with the steel foundry was unworkmanlike; as a subsidiary point it asserts that if there were any fault in the construction of the roof, the steel foundry was also to blame, and the plaintiff is affected thereby; finally, the defendant raises the defence of prescription.
The Landgericht dismissed the claim, but on the plaintiff's appeal the Oberlandesgericht gave judgment for the plaintiff. On the defendant's appeal, this decision was reversed and the case remanded.
1(a) The court of Appeal did not decide whether the victims' (and consequently the plaintiff's) claims in tort, if any, were prescribed. It held that the victims had a direct claim against the defendant for positive breach of contract under paras 328, 618 par. 1 and 3, 844 BGB. Its building contract with the steel foundry put the defendant under a subsidiary duty to avoid causing harm to the contractor in the execution of the work. In a case falling under para. 618 par. 1 BGB this duty of the defendant was owed also to the customer's employees; for breach of these contractual duties such people could sue the defendant directly in contract.
(b) This is in line with the doctrine developed by the Reichsgericht and the Bundesgerichtshof; the basis of this liability is a contract for the benefit of third parties, in the sense that it protects those third parties towards whom the creditor himself owes duties of care and protection.
(c) The Court of Appeal was quite correct to include the victims of this accident in the circle of those who are protected by the building contract. Of course this circle must not be unduly large, but in the present case it was sufficiently constricted. The two victims were among the workers and staff who were permanently employed in the factory whose roof the defendants had built. There was thus a group, numerically limited and spatially compact, towards whom the employer had a special duty of care under para. 618 BGB regarding the safety of the work place. This was the only group which the Court of Appeal included within the protective ambit of the building contract; it did not, as the appellant asserts, include the foundry's entire workforce of several thousand people.
2. The Court of Appeal was quite right to hold that the victims' claims passed to the plaintiff under para. 1542 RVO. It has already been held (BGHZ 26, 365) that para. 1542 RVO applies to contractual claims for damages as well as to claims in tort.
3. The Court of Appeal was right to hold that the defendant's fault was a contributory cause of the accident and that therefore it was liable for positive breach of contract ...
4. The Court of Appeal believed that it was irrelevant whether any fault on the part of the steel foundry contributed to the accident, so it did not investigate this question.
The appellant is right to criticise this.
The question is whether in a case like this the contributory fault of the defendant contractor affects the injured third party by reason of para. 254 BGB. The only cases before the Reichsgericht and the Bundesgerichtshof so far have been those where the contractor was the victim's statutory representative or his agent for performance. In these cases the fault has been imputed to the victim (BGHZ 9, 316; 24, 325).
According to the commentators, the party in breach should always be able to face the injured third party with the contributory fault of its contractor under para. 254 BGB, and not just when the contractor is the statutory representative or an agent for performance.
Unlike the Court of Appeal, we agree with this. As in all contracts for the benefit of third parties, it is only out of the contractual relations of the main contractors that the protected third party obtains his rights against the person who injures him. This being so, it is logical that his rights against the party injuring him be no grater than those of the main contracting party. This can be inferred from the juridical basis of para. 334 BGB, whereby contractual defences good against the promisee are good against the third party as well. Some time ago the Bundesgerichtshof said 'the extension of the plaintiff's legal protection by his inclusion in the protected contractual sphere' involves that 'he must accept the concomitant legal disadvantages'. This points to the solution we wish to adopt, and also shows that it is quite equitable.
Since the judgment in issue took no account of any contributory fault of the steel foundry, it cannot be upheld.
5. If the plaintiff's claim could be based on tort, as it might possibly be, the defendant's liability would be unaffected by any contributory fault on the part of the steel foundry. The Court of appeal did not find it necessary to investigate this question, and it has not decided whether any such claim has prescribed. Since this court does not have the requisite facts to make such a decision itself, the judgment under appeal must be vacated and the matter remanded to the Court of Appeal.
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