OGH on the duty to mitigate damage

Nov 17, 2021 Benn-Ibler Rechtsanwälte

Section 1304 of the Austrian General Civil Code (Allgemeines bürgerliches Gesetzbuch, ABGB) imposes an obligation on the injured party to minimise the damage incurred if and to the extent that it is possible and reasonable for him to act accordingly. A breach of the duty to minimise damage occurs, inter alia, if the injured party has neglected actions that would have been suitable to avert or reduce the damage, although the actions would have been taken - objectively considered - by a reasonable average person. Whether there has been a breach of the duty to minimise damage is to be assessed ex ante.

In the present case, the defendant argued in the appeal before the Supreme Court (Oberster Gerichtshof, OGH) that in the context of the duty to minimise damage, the injured party was obliged to place the motor vehicle repair order as soon as possible, if the damage would otherwise be increased by the accumulation of further costs.

According to established case law on motor vehicle damage, a repair order must be placed as soon as possible if the delayed placing of such an order would likely result in an increase in the damage – e.g. through demurrage charges. Delaying the repair order by a few days is justifiable if this has been agreed or, for example, if it is likely to be economical to repair the damaged vehicle. If the repair worthiness of the damaged vehicle is not readily apparent to the injured party - i.e. on the verge of a total loss - a longer period of time is to be granted.

In the case at hand, no total loss is at issue and the plaintiff seeks, among other things, the repair costs calculated by the repair workshop. If one admits that it was initially unclear to her whether she would have to purchase another vehicle, this entitled her to wait longer than a few days before making a decision and to arrange for investigations, but she cannot be allowed to wait any longer before issuing the repair order after filing the complaint.

OGH 2 Ob 177/20y (28.09.2021)