OGH: On liability for culpa in contrahendo when using an envoy
According to the established case law of the Supreme Court (Oberster Gerichtshof, OGH), there are pre-contractual duties to warn and inform. The contractual partner is particularly worthy of protection if he has already entered into commitments himself in reliance on the conclusion of the contract, even if he relies on the actions of the contractual partner's envoy.
In the present decision, a Bauträger GmbH (property development limited liability company) had been granted power of attorney by the defendant to conclude contracts, and its declarations are thus to be attributed to the defendant. The Bauträger GmbH commissioned an intermediary to find a supplier for the furnishing of a hotel project of the defendant. The intermediary obtained a lump sum offer from the plaintiff. After clarification of a price reduction and the procurement of samples by the intermediary, the plaintiff received the defendant's data from the Bauträger GmbH. The intermediary also gave the impression that the order was going well. The plaintiff then commissioned a subcontractor to manufacture the furniture. Although an order confirmation from the plaintiff also remained unchallenged, the defendant ultimately replied that a contract had never been concluded.
The court of first instance granted the claim in its entirety. The Court of Appeal partially accepted the defendant's appeal and dismissed the cancellation costs claimed by the plaintiff. The OGH confirmed the decision of the court of first instance.
If a profound state of trust was created in the pre-contractual negotiation, so that a conclusion of the contract could be considered certain, then according to the principles of culpa in contrahendo, the negotiating party who has withdrawn from the contract is exceptionally obliged to pay compensation.
An envoy differs from a person with power in that he does not form an independent legal will, but exercises a transmission function with regard to other people's declarations of intent. The negotiator is the principal's (hiring entity’s) vicarious agent with respect to the conclusion of a contract. His conduct and knowledge are to be attributed to the principal.
The Bauträger GmbH was provided with power of attorney to conclude the contract by the defendant. The intermediary had in turn the order of the Bauträger GmbH to find a suitable supplier. Although the intermediary did not have power of attorney to conclude contracts, she was in any case authorized to receive legal declarations on behalf of Bauträger GmbH and thus on behalf of the defendant and to forward its declarations to the plaintiff. She was thus the defendant's negotiating assistant and was to be attributed to the defendant.
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