Do merchants have an inspection duty?!

Philipp Reusch

The Higher Regional Court of Brandenburg explained the circumstances under which a merchant has an inspection duty. The plaintiff was the operator of a riding school. For this purpose, it acquired a fence feeder panel from the defendant, a merchant specialised in agricultural and stall supplies. The plaintiff claimed that the panel was defective because the crossbars were not set at a distance appropriate for the animals. One of the plaintiff’s horses got caught in these crossbars and suffered injuries that made it necessary to put the horse to sleep. The plaintiff demanded compensation from the defendant for the financial loss incurred as a result of having to euthanise the horse. The Potsdam District Court awarded the plaintiff damages. The defendant then appealed to the Brandenburg Higher Regional Court (judgement of 18 February 2020 - Case 6 U 50/18).

The appeal was successful. According to an expert opinion previously requested by the Potsdam District Court, a defect in the fence feeder panel was affirmed. However, according to the Higher Regional Court, no claim for damages existed, because the seller was not at fault, as was required to assert the damage compensation claim. Though negligence was actually presumed, the defendant was able to exonerate itself. The requirements for negligence could be based on the Product Safety Act, the Higher Regional Court ruled. The Court clarified that based on product safety regulations, a feeder device may only be made available on the market if the health and safety of persons are not endangered when the device is used as intended. In the case at hand, however, it was not the health and safety of a person that was at risk - but that of a horse. Therefore, the requirements for negligence and the exoneration from the presumed negligence were to be governed by the German Civil Code. The defendant in the case at hand was only a merchant. In principle, a merchant is not subject to elevated requirements for exoneration. The merchant does not have a general duty of inspection towards the buyer. A detailed examination of the goods need only take place if there are specific reasons for doing so.

The Higher Regional Court concluded that claims based on the Product Liability Act were out of the question. The defendant was not the manufacturer and the damages were not to be compensated in accordance with the Product Liability Act because the product was used exclusively for business purposes, which normally rules out liability in accordance with the Product Liability Act. The Higher Regional Court thus confirmed the established case law. For the plaintiff, this meant that it was stuck with its loss. Life is not a pony farm.

Practical tip:

Merchants too must comply with their obligations to carry out inspections. However, the concrete form these obligations take always depends on the specific case. A merchant must be attentive and, if special circumstances exist, examine the goods thoroughly if necessary. Otherwise, the merchant could be liable later in the event of damage.

[October 2020]