Answering the question of whether there is a significant defect is very difficult, especially in often very complex plant construction. The absence of major defects is the decisive prerequisite for acceptance. The latter has considerable legal and practical significance: the start of the warranty periods is regularly linked to this. In addition, the due date of a considerable part of the agreed remuneration generally depends on acceptance.

The following article deals with the criteria that are particularly important when assessing whether a significant defect is to be assumed.

General definition: Material defect

In principle, a material defect exists if a defect is so serious in terms of its nature and scope, but above all in terms of its effects, that the client cannot reasonably be expected to ultimately rely on warranty claims, taking into account objective aspects in relation to the use assumed in accordance with the purpose of the contract and the success achieved.

Question: Is it reasonable to refer to warranty rights?

In plant construction in particular, it is evident that it is not possible to achieve complete freedom from defects at the agreed time of acceptance. Accordingly, the materiality of a defect is reached less quickly in large-scale plant construction than in less complex work.

When assessing the question of whether the client may refuse acceptance due to significant defects, the circumstances of the individual case must always be assessed. In addition to the question of whether the client can reasonably be expected to refer to the defect rights, the question of whether a defect justifies denying the contractor all the benefits of acceptance should also be examined.

Restrictions in usability and safety deficiencies are usually to be regarded as significant defects

Restrictions on usability and safety defects are generally considered to be significant.

Here, even “minor” deviations may constitute a significant defect. For example, the Higher Regional Court of Düsseldorf (BauR 2004, 1668) has ruled that in the area of sound insulation, a negative deviation of 3dB can be sufficient to justify a significant defect.

With regard to the usability of the delivered work, it must be taken into account that its impairment must be assessed all the more highly – and thus all the more likely as a significant defect – if warranted characteristics are not fulfilled, as the client has attached particular importance to these.

Number of existing defects significant?

Even if it cannot be automatically concluded from the mere number of defects that the service is not suitable for acceptance, the sum of individually insignificant defects can certainly result in a right to refuse acceptance. In this respect, in individual cases, several minor defects added together may be equivalent to a major defect.

Amount of the defect rectification costs

Finally, the (total) costs of remedying the defect must also be taken into account when assessing materiality.

The higher the total cost of remedying existing defects, the more likely it is that the materiality criterion will be met.