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Case:
BGHZ 21, 102 I. Civil Senate (I ZR 198/54)
Date:
22 June 1956
Judges:
Professor Basil Markesinis
Copyright:
Raymond Youngs

The K Speditionsgesellschaft mbH (transport company) (KSG), a sister company of the defendant, commissioned the claimant (who carries on a haulage business) as haulier by arrangement with the Association of Road Traffic Hauliers (loading area distribution point) for the dispatch of certain goods to H. When the claimant's lorry and trailer were already laden, the claimant's husband, who was driving the vehicle, suffered a fatal accident while coupling the lorry and the trailer. The head of the Association, the haulier Q, acting on the claimant's behalf turned to an employee F of KSG for the provision of a driver. F then contacted the defendant's employee S. The driver H employed by the defendant was thereupon made available to the claimant and carried out the transportation with the claimant's vehicle. On the journey back, the vehicle broke down as a result of engine damage and had to be towed away.

The claimant seeks reimbursement of repair costs and loss of profit from the defendant. She considers that the defendant is liable for H as its assistant in performance (Erfüllungsgehilfe), but at least for the fact that it had provided an unreliable driver in breach of its duty.

(...)

The Landgericht ordered the defendant to pay part of the sum. The Oberlandesgericht rejected the claim. The claimant's appeal in law led to reference of the case back to the appeal court.

Grounds:

I. (...)

II. On the other hand there are severe legal difficulties about the appeal court's assumption that the assignment of the driver H did not produce any legal obligation on the part of the defendant. (...)
The very concept of a favour assumes that the service in question will not be paid for. But mere the fact that the service will not be paid for does not permit the conclusion that it does not have the character of a legal transaction. The statutory regime about grace and favour transactions (eg §§ 516, 598, 662 and 690 of the BGB) shows this. On the other hand, the giving of advice or a recommendation on a pure grace and favour basis produces no legal effect (§ 676 [§ 675 (2)] of the BGB). The unselfishness of the person acting does not in itself suffice to refute the assumption that legal relationships may possibly arise from the circumstances. Legal obligations for the person performing the service can arise from favours he promises or provides, although this is not inevitable.

If the person providing the service is obliged to provide it (§ 241 of the BGB) the effectuation of the service is bound to take place in the realm of legal transactions (in particular that of § 242). However, the absence of such an obligation does not in any way exclude the possibility of a favour exhibiting the character of a legal transaction (references omitted). The defendant, in rejecting liability on the basis that it was not obliged to make the driver available, fails to recognise this.
A favour shown to someone will only have the character of a legal transaction when the person providing the service intends that his actions should be legally recognised (references omitted) and if he thus intends to create a legal commitment (references omitted) and the recipient has received the service in this sense. If this is not - whether because no intention to be bound can be assumed due to the type of favour involved or the circumstances under which it was given, or because such an intention was expressly or tacitly excluded - the matter cannot be assessed from the angle of a legal transaction. The question of whether there is an intention to be legally bound should not be decided according to some inward intention of the person giving the service which has not been made apparent. It should be determined by whether the recipient of the service should have concluded from the actions of the person providing the service that there was such an intention in the given circumstances according to the principle of good faith and having regard to business custom. It is therefore a question of how the actions of the person providing the service appear to the objective observer (references omitted).

The type of favour, its basis and purpose, its significance in a business and a legal sense (in particular for the recipient), the circumstances in which it is provided, and the state of the interests of the parties at the time can raise the favour above the level of pure factual events. These factors are therefore relevant when assessing the issue of an intention to be bound and the nature of any possible legal transaction. Favours in everyday life are as a rule outside the scope of legal transactions. The same applies for favours which are rooted in purely social relationships (references omitted). The value of a item which has been entrusted to someone, the business significance of a matter, the recognisable interest of the recipient of the favour and the danger he might run - which he cannot recognise but the person providing the service can - if the service is performed defectively, can lead all to the conclusion that there was an intention to be legally bound (references omitted). Information given within the framework of a business relationship must therefore be on the basis of a legal obligation of conscientiousness (references omitted). If the person providing the service has himself a legal or business interest in the assistance given to the person receiving the favour, this will as a rule argue in favour of him being legally bound (references omitted). As with contractual negotiations, liability is usually based in cases of this kind on the violation of a duty of care (Sorgfaltspflicht) which has arisen through establishment of legal relationships or a relationship of trust similar to a contract (references omitted).

If these legal principles are applied to the case to be decided, the result is as follows. The defendant was not obliged to provide a driver, and KSG, which had given the transportation order to the claimant, did not have such a duty. But when the defendant made a driver available at the request of the claimant or of the Association for Road Traffic Hauliers (which, according to the finding of the appeal court, was acting in her name) it had a legal duty to send a reliable driver. The favour requested by the claimant was something which concerned the economic and business activities of both parties. The appeal court judgment in its subsidiary reasoning speaks of an event in legal relationships between the road traffic business undertakings concerned. The claimant was in a predicament as a result of the death of her husband. If she found no driver, she not only lost profit from the freight business; she also possibly had to bear the costs - small though they were - of reloading the goods. It was obvious, and S could also recognise, that sensibly the claimant was not prepared to carry out the freight business whatever the circumstances, and even accepting the risk associated with the employment of an unreliable driver. For the claimant, the vehicle represented not only an object of quite substantial value, but also a significant source of income. The claimant could and was allowed to place confidence in the defendant allocating a reliable driver to her, and the defendant was not permitted to disappoint this reliance. If it had no appropriate driver available, it should have refused the claimant's request. If it did not want to do that, then it should at least have drawn the claimant's attention to the doubts which existed about the intended use of driver H, in order to escape legal consequences.

(...)

The defendant is therefore responsible for the choice of a reliable driver.

III.
These considerations not only provide the basis for the defendant being legally bound, but they also answer, in substance, the question of the degree of fault-based liability. (...) The view is put forward in the academic literature (references omitted) that liability for favours is limited, as a rule, to intention and gross negligence. Whether such a principle can be established can be left undecided. The statutory regime for fault-based liability in the case of gratuitous contracts is formulated in differing ways (§§ 521, 599 of the BGB: liability for gross negligence; § 690 of the BGB: liability for the care one takes in one's own affairs; § 662 of the BGB (with § 276 of the BGB), giving of information in the context of an existing binding relationship: liability for slight negligence). In the case of statutory liability for grace and favour journeys, the case law has expressly rejected the establishment of such a principle (references omitted). The question of the scope of the liability in grace and favour relationships which are of legal significance must be decided according to the circumstances and the form which the individual case takes. Where the grace and favour activity springs from a relationship of trust, and the subject-matter concerned is of economic and business importance, as a rule, in correspondence with the statutory regime for liability in the case of a mandate (Auftrag), observance of the care necessary in human affairs is expected of the person providing the service. This is especially so if there is a particular business commitment on the part of the parties. The individual circumstances mentioned above, and the fact that the claimant's request was transmitted by the Association for Road Traffic Hauliers as the technically competent authority for both parties, justify the analogous application to the present case of the provisions about mandates applying for gratuitous contracts to procure services.

There is also no cause for limiting the liability under the statutory provisions by assuming a more or less fictional agreement to limit liability, as the claimant has stated through her expert representative Q that she asked for a reliable driver and in the circumstances was permitted to assume that the defendant would comply with this request. (...)

IV.
(...) Accordingly it can be assumed that the defendant, on the basis of an obligation arising from a legal transaction, could have only have sent H without violating the care necessary in human affairs if it had pointed out to the claimant the substantial doubts existing about his responsible control of the vehicle on a long-distance journey.

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