When buying real estate, the seller must point out hidden defects if he is aware of them. However, according to a ruling by the Frankenthal Regional Court, the burden of proof for this lies with the buyer.
To prevent trouble, liability for material defects in real estate purchase contracts is regularly excluded. However, the exclusion of warranty refers only to defects that were detectable by the buyer. The seller is obliged to point out hidden defects as well. If such defects were fraudulently concealed by the seller, the exclusion of warranty does not apply, and the seller remains liable, explains the business law firm MTR Rechtsanwälte.
A prerequisite for the seller’s liability for hidden defects is that he was aware of them. The burden of proof for this knowledge lies with the buyer, as the LG Frankenthal decided in a ruling on November 24, 2021 (Ref.: 6 O 129/21).
In the underlying case, a couple had bought a residential house. The seller had lived in the house himself for many years before. Five years after the couple moved into the house, they claimed that the insulation of the roof was inadequate. The installed insulation boards were unsuitable, and there was a lack of a so-called vapor barrier. The couple therefore demanded that the seller pay an advance for proper insulation.
However, the LG Frankenthal dismissed the lawsuit. It reasoned that a warranty exclusion had been effectively agreed upon in the purchase contract. Therefore, for the seller’s liability, it is a prerequisite that he acted fraudulently. However, it was not proven that the seller was aware of the defect in the roof insulation and fraudulently concealed it, the LG Frankenthal further stated. The roof was neither leaking nor damp, and the requirements for the energy performance certificate were met. Furthermore, the seller had lived with his family in the house without restrictions for ten years and had used the attic space. Therefore, it cannot be assumed that the seller was aware of the defect. For defects that merely should have been evident, the seller is not liable, according to the court.
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