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Case:
BGH NJW 1984, 230 Bundesgerichtshof (seventh civil senate) VII ZR 43/83
Date:
22 September 1983
Judges:
Professor B.S. Markesinis
Copyright:
Mr Raymond Youngs

Facts:

In 1976 the defendant entrusted the claimant, who had made an appropriate offer in the name of "H-Metallbau (Metal Construction)", with the delivery and installation of windows and doors and with the execution of other metal work for the construction of a office block. The claimant in her claim demanded the balance due. Having regard to the defendant's numerous complaints about defects, the parties agreed in an exchange of letters of the 1st December 1978, 9th January 1979 and 26th January 1979 that an expert opinion should first be obtained regarding the defects complained of by the defendant in proceedings for the preliminary gathering of evidence; and then the claimant should eliminate the defects, and after this the defendant should pay the balance of the sum demanded for the work. After receipt of the expert's opinion, the claimant stated that it was prepared to eliminate the defects. The defendant however declined this, and referred to the fact that it was entitled to have the defects removed by a third party. The claimant, who was also technically unsuited for the work, had not only not made any serious efforts for several years to put the work right, but she was also - as the defendant had first discovered in 1979 - not legally in a position to do so, as she was not a member of the Chamber of for Skilled Trade but merely a member of the Chamber of Industry and Commerce. She therefore lacked the authority to carry out the skilled work to be dealt with here.

The Landgericht found the defendant liable in accordance with the application. The appeal and the appeal in law were unsuccessful.

Reasons

:...

As the appeal court...considers,...the necessary elimination of defects has admittedly still not been effected. The defendant could not however derive any rights from this, as it had "consistently refused and prevented" the remedial works which had been repeatedly offered. The fact that the claimant and her husband were not entered as managers in the register of skilled tradesmen did not permit the defendant to free itself from the agreement which had been made. The appeal in law is unsuccessful in challenging this.

1. First it takes the view that the work contract concluded between the parties is void in accordance with § 134 of the BGB as only a master tradesman entered in the register of skilled tradesmen was allowed to undertake the services put out to tender. After it had discovered that the claimant had not been entered, it (the defendant) had been able to avoid the consequential agreement of December 1978 / January 1979. This was conclusively seen by the fact that it had rejected any remedial work by the claimant. That is wrong simply because the prerequisite assumed by the appeal in law for the avoidance declaration (invalidity of the work contract) is not present. It is necessary to proceed on the same basis as the appeal court that the fact that the claimant is not entered in the register of skilled tradesmen has no influence on the effectiveness of the contracts in question, even if the claimant's business falls under the provisions of the Skilled Trade Order. She ought then in principle not to carry out any skilled trade services, because neither she nor her husband had the master tradesman's certificate necessary for the entry or an appropriate approval of an exception (§§ 7 ff. of the HandwO (Skilled Trade Order)). Nevertheless a violation - as assumed here - of this statutory prohibition would not of itself lead to ineffectiveness of civil law contracts which deviate from it.

a) The question of whether legal transactions which contravene the prohibition are void under § 134 of the BGB is to be answered according to the sense and purpose of the prohibiting provision in question. The decisive issue is whether the statute is not only opposed to the conclusion of the legal transaction but also its effectiveness in private law and therefore its economic consequence (references omitted). Even the fact that an act is made punishable or is threatened with a fine as an administrative offence (see § 117 (1) no. 1 of the Skilled Trade Order) does not irrefutably cause the invalidity of the civil law transaction. That applies above all when the prohibition only concerns one of the parties concluding the contract (the claimant in this case): as a rule such a contract is valid (references omitted). In special cases invalidity admittedly can also follow from the violation of unilateral prohibitions, if the purpose of the statute cannot be otherwise attained and the regime created by the legal transaction cannot be accepted ([reference omitted] for a violation of the Legal Advice Act; [reference omitted] for banned advertising of medicines; [references omitted]). Such an exception is present, for example, if the statute creating the prohibition is to serve the protection of the individual consumer and therefore also that of the particular contractual partner (references omitted). If on the other hand it is a question of a mere administrative provision which forbids an otherwise unobjectionable legal transaction on the grounds of regulation of trade or a policy of preserving order, the validity of a contract which is concluded contrary to the prohibition remains unaffected (references omitted).

b) The Bundesgerichtshof has not so far decided what consequences in civil law a violation of § 1 of the Skilled Trade Order carries with it. The opinions in the case law and the literature - few in number - refer to the purely public law function of preserving order which this provision has, and therefore unanimously assert the effectiveness of contracts which contravene the prohibition (references omitted). The Senate endorses this view, having regard to the purpose of the Skilled Trade Order.

The legislator has made permitting the independent carrying on of a skilled trade dependent on proof of vocational knowledge and skills, in order to maintain the high level of performance and peformance capacity of skilled tradesmen in the interests of business as a whole. At the same time he wanted to ensure the proper training of new recruits for skilled trade, as also for the rest of the business world. He saw an appropriate and necessary means for the attaining of this goal in the introduction of proof of qualifications and entry in the skilled trade register (BVerfGE 13, 97 [107ff.] = NJW 1961, 2011 with extensive references to the story of the origin of the Skilled Trade Order; [reference omitted]). On the other hand, averting dangers for the general public or the individual from an improper exercise of a vocation were of no concern to him. Instead the decisive factor was interest in the maintenance and promotion of a sound capable level of trade as a whole (reference omitted).

Sufficient account can be taken of this by measures in vocational law or public law sanctions (§§ 16, 118 of the Skilled Trade Order), without it being necessary to deny effectiveness in civil law to an individual legal transaction which had come into existence within the framework of the prohibited carrying on of a trade (references omitted). A further argument in favour of this result is the fact that § 3 of the Skilled Trade Order allows subsidiary or auxiliary services to skilled trades to be carried out by a different main enterprise, and § 4 of the Skilled Trade Order even permits the continued conduct of the business of a deceased master tradesman for a certain period by his surviving dependant who does not have vocational knowledge and training. It follows from this that the contract for building works concluded between the parties is not invalid under § 134 of the BGB.

2. Nevertheless the appeal in law considers that the defendant was not bound to the agreements of December 1978 / January 1979. The defendant had - so it now claims - made a mistake about the skilled trade law status of the claimant and effectively made a declaration of avoidance immediately after revelation of the true state of affairs. The appeal in law is likewise unsuccessful here.

a) It is doubtful whether the defendant has given a proper declaration of avoidance at all in the sense of § 143 of the BGB by its refusal of the offer of remedial work by the claimant. It is true that the express use of the word "avoid" is not necessary for this. But it is always necessary for there to be a statement or conclusive conduct from which it unambiguously follows for the recipient of the avoidance that the declarant wishes to overturn the legal transaction retrospectively because of lack of intention (references omitted). Here the defendant has merely referred to the fact that it considered the carrying out of remedial works by the claimant to be unreasonable because of the extensive defects and the lack of proof of the skilled trade qualification. The fact that this was lacking in the clarity necessary for a declaration of avoidance argues strongly in favour of the above view. In the end the Senate does not however need to go into this question in greater detail, as the defendant in any case has no ground for avoidance worth considering.

b) The only kind of avoidance which comes into consideration is one in accordance with § 119 (2) of the BGB according to which a mistake about the characteristics of a person which are of importance in the affairs of life is to be regarded as a mistake about the content of the declaration. This includes the natural features of personality as well as those factual and legal circumstances which, as a result of their nature and assumed duration would, according to the general view of things, usually influence the assessment of a person in all or in certain legal relationships (reference omitted). This can - depending on the circumstances - quite reasonably include the qualification of the contracting partner in vocational law, as is necessary for an entry in the register of skilled tradesmen. But whether a mistake about this justifies avoidance of a legal transaction is dependent on the special circumstances of the individual case. In this respect account must be taken of the transaction avoided and its objectives (references omitted). If the concept of mistake about a characteristic is not to become too trivial and to give rise to intolerable legal uncertainty (reference omitted), only those characteristics of a person may be considered as of significance in the affairs of life which the declarant has made the basis of the contract in some recognisable manner (without him needing actually to turn them into part of the content of his declaration) (references omitted).

That - so far as concerns the entry of the claimant in the register of skilled tradesmen - has not happened in the present case. The defendant may admittedly on the conclusion of the building contract and of the later agreement for remedial work unconsciously have proceeded on the basis that the claimant fulfilled the prerequisites in vocational law for her trade activity. It has however never expressed the view that this circumstance was to be of importance for the commissioning of the work. It only seemed to matter to it that the claimant's business enterprise was in a position to carry out the contractual services with the necessary expert knowledge and reliability (reference omitted). The issue of whether the business was legally a skilled trade one or an industrial one with a subordinate skilled trade sideline was however unimportant. As the appeal court correctly established, the claimant has at no time given the impression that she was proprietor of a skilled trade enterprise. She described her trade in a neutral manner as metal construction, was a member of the Chamber of Industry and Commerce and took part in business life under this designation for many years, without any objection from the competent authorities. If the defendant nevertheless only intended to conclude the work contract with a registered skilled trade business, it would have had to make its intention clear in an appropriate manner. As it has not done this, avoidance of the agreement of December 1978 / January 1979 is excluded, without regard to whether the claimant actually violated the provisions of the Skilled Trade Order or not.

3. Finally the defendant has also not behaved unreasonably subsequently in adhering to that agreement. (Details are given).

4. As a result of the defendant's refusal in respect of the claimant's repeated offers of remedial work, the claim for payment for the remainder of the work has in the meantime become due. (Details are given).

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