Term and Definition of the Reduction Order
Als Reduction Order is a court order that mandates the reduction of a value, amount, or level stipulated by law or on a case-by-case basis. The reduction order is particularly relevant in cost law, especially in connection with the determination of object values, amounts in dispute, or value assessments, provided there is a legal basis or authorization for this. A reduction order can also pertain to other factual situations in which court decisions retroactively reduce an originally established value.
Legal Basis of the Reduction Order
Statutory Regulations
The legal basis for a reduction order can be found in various laws, in particular in the Code of Civil Procedure (ZPO), the Court Costs Act (GKG) as well as in the cost schedules of the courts. According to section 63 GKG, an authority or court decision on the determined amount in dispute may be altered if subsequent developments, errors, or new findings make a reduction imperative.
Reduction of the Amount in Dispute or Object Value
Practical Applications
The court may correct downward the amount in dispute or the object value it set, for example, if it is subsequently revealed that the value was set too high or the statutory assessment guidelines were incorrectly applied. A typical case is the reduction of the amount in dispute in family court proceedings pursuant to section 51 (2) FamGKG.
Procedural Particularities
As a rule, a separate order is required for the reduction of an amount in dispute. The reduction order may be issued ex officio or upon application by a party. The right to file such an application is permitted within a specific period after notification of the value determination.
Effects of a Reduction Order
Cost Reduction
A significant effect of a reduction order lies in the lowering of the court and lawyer fees incurred. As these are usually calculated proportionally based on the amount in dispute or object value (see section 15 RVG), a lower value leads directly to lower fees and expenses.
Retroactive Application
The reduction generally takes effect retroactively to the time of the original determination (so-called retroactive effect), depending on the specific legal regulation. In individual cases, the order can also take effect only ex nunc, i.e., for the future only.
Binding Nature and Contestability
The reduction order has binding effect for the parties and the proceedings. Depending on the precise procedural law, an appeal, such as a complaint, can be lodged against a reduction order.
Differences to Other Judicial Value Determinations
A reduction order differs from an initial determination or an increase (so-called “increase order”) of the value in that it solely provides for a subsequent reduction of the fixed amount. The legal basis and consequences differ in detail depending on the area of law and type of proceedings.
Practical Relevance and Typical Fields of Application
Civil Court Proceedings
In civil proceedings, the reduction order becomes relevant if the amount in dispute decreases after the filing of the lawsuit, for example due to partial withdrawal, acknowledgment, or settlement for a lower value.
Family Law and Labor Matters
In family law, particularly in matters ancillary to divorce, the procedural value is often reduced upon application or ex officio when the economic circumstances of the parties do not justify the originally assumed value determination.
Administrative Jurisdiction
In proceedings before administrative courts, a reduction order can also be used to retrospectively reduce amounts in dispute or object values to reflect actual economic conditions.
Conclusion
Der Reduction Order is a significant instrument in procedural law that ensures that value determinations by courts can be adjusted to actual economic and legal circumstances. This contributes to transparency and fairness in cost law and prevents disadvantages resulting from incorrect value assessments. Correct application always requires careful examination of the legal requirements and the specific situation of the individual case. The possibility to challenge a reduction order also safeguards the parties’ legal protection.
Frequently Asked Questions
Within what legal framework does a reduction order occur, and which statutory requirements must be observed?
A reduction order is typically made within the context of residential property law or building law. The primary legal basis is the German Condominium Act (WEG). Here, section 20 WEG is particularly relevant, dealing with structural changes and modernizations to communal property. A prerequisite for an effective reduction order is generally the proper convening of a homeowners’ meeting as well as the correct announcement of the agenda item. When passing a resolution, it must be observed that such structural measures – such as the lowering of a part of the property, a terrace, or garage – are usually considered “structural changes,” which can be resolved by qualified majority, in individual cases under new law even by simple majority or the consent of directly affected owners. Furthermore, public law provisions must be taken into account, for example requirements under building regulations, neighbor law, and, if applicable, monument law. Therefore, implementing a reduction order may require not only private consent but also an official permit.
Who is authorized to initiate a reduction order and what steps are required?
Generally, all co-owners in a condominium association are eligible to apply for a reduction order. Submission of a corresponding application is done by placing it on the agenda of a homeowners’ meeting. The administrator is obliged to include a properly submitted application on the agenda, provided a co-owner requests it in due time. For the validity of the resolution passed, all formal requirements of a homeowners’ meeting, such as notification deadlines, recording of minutes, and determination of majority, must be strictly observed. In practice, this means that all affected and potentially disadvantaged owners must be heard before passing the resolution. If necessary, building and neighbor law provisions must also be checked before the resolution is passed and implemented.
What rights and obligations do owners acquire from a reduction order?
With a validly adopted reduction order, the owners acquire the right to carry out the specified measure. At the same time, obligations arise in terms of implementation, such as compliance with technical specifications, permit requirements, and cost allocation. If individual owners are affected by the measure, for example, by changes in access or possible disadvantages in use, their rights must be protected according to the WEG and, if applicable, neighbor protection regulations. Furthermore, under section 21 (4) WEG, it can be agreed that certain costs or consequential damages resulting from the measure must be borne by specific owners. If rights to contest exist, affected owners can file a lawsuit at the competent district court within one month after the resolution.
What formal requirements must be observed when passing a reduction order?
The formal requirements for a reduction order primarily include the proper convening of the homeowners’ meeting and the correct announcement of the agenda item. The invitation must be issued according to the WEG deadlines and the proposed resolution should be formulated as specifically as possible, since vague wording may increase the risk of the resolution being contested. The resolution itself must be recorded in the minutes, documenting both the voting results and the essential discussions. For certain structural measures, fundamentally a qualified majority (majority of all owners registered in the land register) may be required. If the measure is to be carried out on communal areas, it must also be checked whether the consent of all those owners who will suffer a disadvantage from the lowering is needed (section 20 (4) WEG).
What legal options exist in the event of rejection or contestation of a reduction order?
If a reduction order is rejected, the matter can generally be put to a vote again at the next homeowners’ meeting. If, on the other hand, a resolution has been passed, owners who are adversely affected by the reduction have the right to file a contestation action with the competent district court within one month after the resolution (section 44 WEG). The court will examine, in particular, whether any formal or substantive legal errors occurred in the resolution process and whether the measure corresponds to proper administration. During the ongoing court proceedings, implementation of the resolution is generally not permitted, unless the resolution was declared immediately enforceable. If the resolution is revoked by the court, the measure may not be implemented; otherwise, implementation is permitted.
What liability issues can arise in connection with a reduction order?
Various liability issues can arise in connection with a reduction order. For example, if the implementation of the lowering creates a construction defect or damages arise to communal or separate property as a result, those who carried out or initiated the measure are generally liable – either jointly and severally (if implemented as a group) or proportionally if the cost allocation is regulated accordingly. If the measure results in a disadvantage to third parties (neighbors or public interests), liability may also arise for the condominium association or individual owners, especially in cases of violations of public law regulations. It is therefore essential to always obtain the necessary permits for such measures and to closely monitor the execution.
What impact does a reduction order have on existing permits or rights of use?
A reduction order can impact existing permits in such a way that they may need to be reviewed and, if necessary, adjusted. If the planned reduction does not correspond to the original building permit or the declaration of division, a new official permit must be obtained. Rights of use, such as easements or parking space usage, may also be affected by a lowering, requiring an amicable arrangement with the relevant rights holders. Without clarification of the legal situation and ensuring the adjustment of existing rights, implementation of the measure may pose significant legal risks for the homeowners association.
