The Federal Court of Justice recently had to decide whether a customer is entitled to compensation for the loss of use beyond the reimbursement of specific damages in the event of a telephone, fax and internet outage.
Guiding principles of our law firm:
- At least in the private sphere, when applying the required strict standard, a fax machine is not an economic good whose constant availability is typically of central importance for the individual in his or her own economic livelihood and whose malfunctioning as such has a significant effect on the material basis of that livelihood.
- A landline and an internet connection are assets in the above sense that come into consideration for compensation for loss of use.
- The internet has become a medium that plays a decisive role in shaping the lives of a large proportion of the population, and its failure is significantly noticeable in everyday life.
- The obligation to pay compensation for loss of use does not apply if the injured party has an approximately equivalent replacement available, the usage costs of which are reimbursed by the injuring party.
- An equivalent replacement for a landline telephone connection in the private sphere is a mobile phone, even if the mobile phone and SIM card are only purchased when the landline telephone connection fails and therefore the mobile phone number must initially be distributed to third parties in order to be reachable.
- A smartphone can be an adequate substitute for an internet connection in a private setting. The court of fact must determine, upon appropriate presentation by the parties, whether the internet can be used with it.
- As a benchmark for the withdrawal of an internet connection, the customer can demand an amount based on the average costs customary in the market for providing a DSL connection with the agreed capacity, excluding telephone and fax use, for the period in question,all profit-oriented and other factors relating to commercial use.
We were surprised by the fact that the BGH did not say a word about the dogmatic extension of the "compensation for loss of use" previously granted only for property to services. In GZS 1/86, the Grand Senate of the Federal Court of Justice had emphasized that "loss of use is limited to property".
Federal Court of Justice
JUDGMENT
III ZR 98/12
Pronounced on:
January 24, 2013
In the legal dispute
.... against ....
The Third Civil Senate of the Federal Court of Justice has, on the basis of the oral proceedings on January 24, 2013, ruled through Vice President Schlick and judges Dr. Herrmann, Hucke, Tombrink and Dr. Remmert:
On the plaintiff's appeal, the judgment of the 12th Civil Chamber of the Regional Court of Koblenz dated March 7, 2012 is set aside insofar as the plaintiff's appeal against the judgment of the Local Court of Montabaur dated December 7, 2010 was dismissed.
To the extent that it has been set aside, the case is referred back to the court of appeal for a new hearing and decision, including on the costs of the appeal proceedings.
By law
Facts
The plaintiff is seeking damages from the defendant, a telecommunications company, because he was unable to use his internet connection for an extended period of time. The plaintiff had concluded a contract with the defendant's legal predecessor (hereinafter the defendant and its legal predecessor will be uniformly referred to as the defendant) for the provision of a DSL connection, which he also used for his telephone and fax traffic (Voice and Fax over IP). On December 15, 2008, the parties agreed to a change in tariff. However, the plaintiff's connection was interrupted as of that date. After the defendant was unable to restore the internet connection despite multiple reminders, the plaintiff terminated the existing contract and switched to a different service provider. The new provider activated the connection to its network on February 16, 2009.
The plaintiff is demanding that the defendant compensate him for the additional costs incurred as a result of concluding the contract with the other provider (€427.50) and for the use of a cell phone between December 15, 2008 and February 16, 2009 (€30). In addition, he is claiming compensation for the loss of the ability to use his DSL connection for landline telephony, fax and internet traffic during this period. For this, he demands €50 per day, or a total of €3,150.
The district court awarded the plaintiff €457 for the higher fee incurred at the other service provider, as well as for the costs of mobile phone use. The court dismissed the plaintiff's appeal and the defendant's cross-appeal. The plaintiff's appeal, which the court of appeals allowed, seeks damages for the lost opportunities to use his DSL line.
Reasons for the decision
The admissible appeal is well-founded. It leads to the setting aside of the judgment under appeal insofar as it adversely affects the plaintiff and to the referral of the case back to the lower instance.
I.
The court of appeal ruled that the plaintiff was not entitled to compensation for the loss of his telecommunications connection. Such compensation is only to be granted to the injured party if goods whose availability is of central importance for his or her own economic livelihood are not available to him or her. This also applies to contractual usage options. The daily availability of a fax machine in the private sphere is not to be regarded as an essential good for one's own economic livelihood because it is not needed all that often. The situation may be different for a landline and internet access. In this respect, it is certainly debatable whether it can be said to be of outstanding importance for one's own economic livelihood. However, the plaintiff had used a cell phone as a substitute for the failed connection and claimed the costs incurred as a damage item. A so-called cell phone – at least newer models – also offer the option of using the Internet and, in particular, sending and receiving e-mails. Even if a cell phone replacement is less convenient for the user, it is a way to compensate for the loss of the landline and internet access, similar to a rental car for the damaged and thus inoperative motor vehicle. The customer therefore did not suffer any loss because the necessary additional costs were to be reimbursed. Irrespective of the fact that, according to these considerations, compensation is ruled out on its merits, the amount of the claim asserted is considerably excessive. In the event of loss of landline and internet connection, this should be based on the amount of the monthly fees paid for such a connection. In this case, this is the monthly flat fee of €24.90 agreed by the parties.
This does not stand up to legal scrutiny in all respects.
1.
Since the court of appeal has limited the revision to the amount of damages, the court must assume in its decision that the plaintiff has a claim for damages in accordance with § 280 BGB because the defendant has culpably violated its contractually agreed obligations by not providing the service incumbent on it in the period from December 15, 2008 to February 16, 2009.
2.
The view of the lower court that the plaintiff cannot claim damages for the loss of the ability to use the landline telephone, the fax machine and the internet via his computer, caused by the interruption of the DSL connection, which go beyond the reimbursement of the additional costsfor the connection to the other service provider and for the use of the cell phone, the Senate cannot agree.
a) Compensation for the loss of the possibility of using an asset can be considered for a use of the asset in question that is comparable to a profit-enhancing, commercial use and that is comparable to a self-financing, profit-enhancing use that can be recorded in terms of assets. Compensation for the loss of the possibility of using an object must, in principle, be reserved for cases in which the functional disorder typically has a significant effect on the material basis of the standard of living. Otherwise, there would be a risk of extending the obligation to pay compensation to non-pecuniary losses in violation of § 253 BGB. This would also come into conflict with the requirements of legal certainty and the predictability of damages (e.g. Federal Court of Justice, judgment of June 10, 2008 - VI ZR 248/07, NJW-RR 2008, 1198 marginal no. 7). Therefore, compensation for loss of use is limited to items whose constant availability is typically of central importance for one's own economic livelihood (BGH, Grand Senate for Civil Matters, decision of July 9, 1986 - GSZ 1/86, BGHZ 98, 212, 222 f; BGH, judgment of June 10, 2008, loc. cit. and for which the loss of use can be measured by objective standards (Federal Court of Justice, judgment of June 10, 2008, loc. cit.). The judge hearing the case should not have to base the compensation on uncontrollable subjective valuations given to him by the injured party, but rather on values that the market ascribes to the interest in the specific use (BGH loc. cit.; cf. also BGH, Grand Senate for Civil Matters loc. cit. p. 222 et seq.). In this regard, the market view can be emphasized, even if it cannot determine where the limit of § 253 BGB lies (BGH, judgment of June 10, 2008, loc. cit.; cf. also BGH, judgment of November 15, 1983 - VI ZR 269/81, BGHZ 89, 60, 62 f mwN).
When examining whether, according to public opinion, the temporary loss of the possibility of using an object can be assessed as economic loss, a strict standard is to be applied. This is required by the legislative decision taken in § 253 BGB, according to which immaterial damage is to be compensated only in exceptional cases, namely in the cases regulated by law (BGH, judgment of June 10, 2008, loc. cit. para. 9). This restrictive standard has led to the Federal Court of Justice repeatedly denying an obligation to pay compensation for the loss of use of objects (see judgments of June 10, 2008, loc. cit. marginal nos. 10 et seq. - mobile home; November 15, 1983, loc. cit. p. 64 - motor sports boat; of December 15, 1982 - VIII ZR 315/80, BGHZ 86, 128 - caravan; of February 28, 1980 - VII ZR 183/79, BGHZ 76, 179 - private swimming pool and of February 12, 1975 - VIII ZR 131/73, BGHZ 63, 393 - fur coat). In the above cases, the awarding of compensation for the loss of use ultimately failed because, according to prevailing opinion, the temporary loss did not constitute economic damage, but rather an individual impairment of enjoyment and thus a non-pecuniary damage. In contrast to this, the Federal Court of Justice has ruled that compensation is to be paid for the loss of the ability to use motor vehicles (st. Rspr. e.g. Senate judgment of September 30, 1963 - III ZR 137/62, BGHZ 40, 345, 348 et seq.; BGH, Urteile vom 10. Juni 2008 aaO Rn.6 mwN and of April 15, 1966 - VI ZR 271/64, BGHZ 45, 212, 215), residential buildings (e.g. BGH, Grand Senate for Civil Matters loc. cit. p. 224) and holiday apartments (e.g. BGH, judgment of September 16, 1987 - IVb ZR 27/86, BGHZ 101, 325, 334). In the case law of the courts of first instance, compensation for loss of use was also awarded, for example, for kitchen equipment (Osnabrück District Court, NJW-RR 1999, 349; LG Kiel NJW-RR 1996, 559), bicycles (KG, NJW-RR 1993, 1438) and television sets (OLG Munich NJW-RR 2010, 1112, 1113) awarded and considered possible for a personal computer and a laptop (Munich Higher Regional Court, VersR 2010, 1229, 1230).
b) Measured against the above abstract criteria and taking into account the case law on this, the question of whether the plaintiff is to be compensated for the temporary loss of the possibilities of use in question must be answered in a differentiated manner.
aa) He cannot claim compensation for the loss of the opportunity to use his fax machine. At least in the private sphere, applying the required strict standard, such a device is not an economic good whose constant availability is typically of central importance for the individual in his or her own economic livelihood and whose malfunctioning as such has a significant effect on the material basis of that livelihood. The fax machine is used to transmit images, which also include texts in particular. The transmission of images by means of signals via telecommunications networks (see § 3 no. 24, 27 TKG) replaces the sending of printouts or data carriers by conventional mail or courier services. The advantage of fax technology over this is that sending is less laborious, since inserting into envelopes, addressing, franking and dropping in a letterbox or handing over to a courier service are no longer necessary. In addition, transportation is considerably faster, and by printing a transmission report, the sender can more easily verify whether the transmission has reached the addressee than when using regular mail. For the recipient of a fax, however, the only advantage is the time saved. The advantages of faxing over traditional delivery methods are merely simplifications that result in greater convenience for the sender and faster transmission. If the fax machine breaks down, this merely causes a relatively minor inconvenience for the user, which does not significantly affect their way of life. In addition, the use of the fax machine is now becoming less important because it is increasingly being replaced by sending text and image files by email, even in legal matters when concluding (consumer) transactions in everyday life (see Section 126b of the German Civil Code (Bürgerliches Gesetzbuch; BGB)).
bb) At least in terms of the outcome, the court of appeal is also right in that the plaintiff is not entitled to compensation for damages insofar as he was unable to use his landline telephone as a result of the interruption of the DSL connection.
The fact that the ability to use the telephone is an asset whose constant availability is of central importance for the way of life has been self-evident for decades and requires no further justification (see only recitals 4, 7 to 10 and in particular 14 of 4, 7 to 10 and in particular 14 of Directive 2002/22/EC of the European Parliament and of the Council of 7 March 2002 on universal service and users' rights relating to electronic communications networks and services - Universal Service Directive -, OJ. EC of April 24, 2002, No. L 108/51).
However, the liable party is not required to compensate for the loss of the opportunity to derive benefits from an asset if the damaged party has an approximately equivalent replacement asset available and the costs that may be incurred for its rental are reimbursed (BGH, judgment of December 4, 2007 - VI ZR 241/06, NJW 2008, 913, marginal no. 10), because in this case the necessary tangible impairment during the relevant period is lacking (see on this, e.g. Senate judgment dated December 13, 1965 - III ZR 62/64, NJW 1966, 589, 590; BGH, judgment of December 4, 2007, loc. cit., and judgments of January 28, 1975 – VI ZR 143/73, Neue Juristische Wochenschrift 1975, 922, 923, and of April 15, 1966 – VI ZR 271/64, Entscheidungen des Bundesgerichtshofes in Civil Matters 45, 212, 219). According to the court of appeal's assessment of the facts, which cannot be legally objected to, such a constellation exists. The mobile phone used by the plaintiff was able to completely replace the failed landline phone, insofar as he himself established connections to other subscribers. However, the plaintiff's accessibility was impeded. Since, according to the findings of the lower courts, he had only procured the mobile phone and SIM card after his internet access was interrupted, he initially had to provide his potential callers with his mobile number after December 15, 2008 in order to be able to receive calls. This was certainly associated with a not inconsiderable inconvenience, which would also have justified terminating a telephone contract for good cause (Section 626 (1) BGB). However, an objectified, typified approach is required when assessing whether an existing replacement object is equivalent. Since the use of mobile phones is now almost as widespread as landline phones in the private sphere and in some cases even replaces them, mobile phone numbers are also common among relatives, friends and acquaintances. Likewise, in business, consumers (also) often provide their cell phone number in addition to or as an alternative to their landline number, if the phone number is requested or provided at all. After that, telecommunications accessibility is generally only slightly limited if the landline phone is out of service. When viewed in the required manner, detached from the subjective particularities of the individual claimant, a mobile telephone is therefore a largely equivalent substitute for the interruption of the landline telephone connection.
cc) By contrast, the plaintiff can claim damages for the loss of the opportunity to use his internet access for purposes other than telephone and fax traffic.
(1) The usability of the Internet is an economic good whose constant availability has been of central importance for a long time, at least since before the turn of the year 2008/2009, which also began in the private spherefor one's own economic livelihood is typically of central importance and in which a functional disorder as such has a significant effect on the material basis of one's livelihood. The internet provides comprehensive information worldwide in the form of text, image, video and audio files. Almost all topics are covered and a wide range of quality requirements are satisfied. For example, files with light entertainment are just as accessible as information on everyday questions and highly scientific topics. Because of the easy availability of information, the internet is increasingly replacing other media, such as encyclopedias, magazines or television. In addition, it enables a worldwide exchange between its users, for example via e-mail, forums, blogs and social networks. In addition, it is increasingly being used to initiate and conclude contracts, to carry out legal transactions and to fulfill public-law obligations (of the immense variety, for example, only: distance purchases, hotel, rail and flight bookings, issuing transfer orders, filing tax returns, registering and deregistering for electricity, gas and water supply and waste collection, and verifying certificates). According to the plaintiff's undisputed submissions, almost 70% of Germany's population uses the internet, with three-quarters of them even using it daily. The internet has thus developed into a medium that plays a decisive role in shaping the lives of a large proportion of the population, and its unavailability has a significant impact on everyday life. The interruption of internet access typically has effects that are comparable in intensity to the loss of the ability to use a motor vehicle.
(2) The court of appeal assumed that the loss of use of internet access was generally compensable, but dismissed the claim for damages brought by the plaintiff on the grounds that he had a substitute in the form of his cell phone. This does not stand up to legal scrutiny.
It is true that the tortfeasor is not liable for the lost opportunity to derive benefits from an asset if the injured party has a roughly equivalent replacement asset and the costs that may arise forrental costs (see above, letter bb). It is also true that a reasonably comfortable internet experience is possible with certain cell phones (for example, with so-called smartphones). However, as the appeal rightly points out, the finding of the court of appeal that the mobile phone used by the plaintiff in the relevant period was internet-enabled and could therefore replace the interrupted landline access was based on a procedural error. Neither the plaintiff's nor the defendant's submissions indicate that the mobile phone used by the plaintiff as a substitute had this function. In particular, the statement of May 31, 2011, cited in the response, contains no information on the functionalities and, in particular, the internet capability of the mobile device.
The remittal gives the parties the opportunity to supplement their submissions on this point, and then gives the court of appeal the opportunity to make the necessary findings.
3. With regard to the further proceedings, the Senate points out the following with regard to the amount of the compensation to which the plaintiff may be entitled:
When calculating the compensation, the amount that the owner would have had to pay to rent a replacement item to bridge the downtime cannot simply be taken as a basis, because it is not a matter of the interest in repair, but of the interest in compensation. This is not based on what costs the owner has saved, but on what the item's usability for the owner is worth in monetary terms for their own use (BGH, Grand Senate for Civil Matters, decision of July 9, 1986 – BGHZ 98, 212, 225; BGH, judgment of September 16, 1987 – IVb ZR 27/86, BGHZ 101, 325, 335). In addition to the pro-rata reserve costs, which in the present case are unlikely to be a suitable benchmark, the starting point for assessing the damage can nevertheless be based on the market values for a transfer of use against payment (BGH, Grander Senate for Civil Matters, loc. cit. p. 225 f; BGH, judgment of September 16, 1987, loc. cit.). Accordingly, the benchmark for the withdrawal of property is the notional rental price, which, however, is to be adjusted for all profit-oriented and other value factors relating to commercial use (BGH, judgment of September 16, 1987, loc. cit.). Applied to the present case, this means that the plaintiff can demand an amount based on the average costs that would have been incurred for the provision of a DSL connection with the agreed capacity for the relevant period, excluding telephone and fax use, less the aforementioned items (see Bamberger/Roth/Schubert, BGB, 3rd ed., § 249 Rn. 32, 38; MünchKommBGB/ Oetker, 6th ed., § 249 Rn. 79; Palandt/Grüneberg, BGB, 71st ed., § 249 Rn. 52). Against this, the compensation that the plaintiff did not have to pay during the period in which the defendant's connection was down in accordance with § 326 (1) sentence 1 BGB must be offset. When calculating the difference, it should be noted that the tariffs for a DSL connection that is only provided for a short time per day are usually considerably higher than those that are agreed for a long-term contract, such as those entered into by the parties.
Schlick & Herrmann & Hucke
Tombrink & Remmert
The statements represent initial information that was current for the law applicable in Germany at the time of initial publication. The legal situation may have changed since then. Furthermore, the information provided cannot replace individual advice on a specific matter. Please contact us for this purpose.