Classification: construction industry and legal framework
As is well known, the execution area of underground infrastructure maintenance and thus also CIPP lining is assigned to the construction industry. In this context, the Hessian Regional Labour Court decided in February 2024 that companies offering both pipe cleaning and pipe rehabilitation are likewise assigned to the construction industry and are mandatory members of SOKA-Bau bound by construction collective agreements.
But that is only incidental, because, in general, all construction projects in Germany and their legal aspects concerning awarding and execution are regulated by the long-established set of rules of the VOB (today: the Procurement and Contract Regulations). As is well known, it sets out construction-specific provisions for the awarding and execution of construction services and is intended primarily for public contracting authorities. Representatives of the public sector and leading organisations in the construction industry take part in the regular revision of the VOB with the aim of creating a fair balance in construction contracts.
The VOB contains General Contract Terms and Conditions for the execution of construction services and takes the interests of the contractual partners into account in a balanced manner. For this reason, the VOB is privileged by BGB §310 para.1 sentence 3.
Risks of deviations from the VOB
So, if the VOB has been contractually agreed without any deviations in content, no substantive review of standard terms and conditions applies. However, this changes dramatically as soon as the construction contract contains substantive provisions that deviate from the VOB, even if they seem insignificant and are not even consciously noticed by the contracting parties. Legally, this is justified by an interference with the otherwise balanced structure of the VOB. For this reason, contractual adjustments should be approached with caution. For if the privileged status of the VOB ceases to apply, this not only means that the provisions deviating from or supplementing it are subject to a substantive review of standard terms and conditions, but also that the provisions taken over unchanged from the VOB into the contract are likewise subject to this review.
The three stages of the terms and conditions content review
In the event of a dispute, the court follows a three-stage review, and to illustrate the relevance of this process, I would like to outline the three stages of the terms and conditions content review in general here.
- Incorporation control (§§ 305, 305c BGB): Was the clause effectively incorporated into the contract? Surprising or ambiguous clauses are, in case of doubt, not deemed agreed upon (§ 305c para. 2 BGB).
- Transparency control (§ 307 para. 1 sentence 2 BGB): Is the clause clear and understandable? Opaque provisions already disadvantage the contracting party unreasonably simply because of their lack of clarity.
- Content control (§ 307 para. 1 and 2 BGB): Does the clause deviate from essential basic principles of the statutory rule or restrict essential rights and obligations to such an extent that the purpose of the contract is jeopardized?
Consequences for client and contractor
The foregoing is intended once again to make clear that the agreement of the VOB only brings legal certainty in the construction contract if it remains untouched as a whole, whereby even seemingly minor details can already remove this privileged status.
It should be made clear in this regard that the review of standard terms and conditions always operates only to the detriment of the party using them. The party that introduced the amended supplementary technical contract conditions into the contract cannot itself rely on the invalidity under standard terms law of its own clauses. The employer will therefore not be able, in the event of a dispute, to assert the invalidity of its own supplementary technical contract conditions clauses. Conversely, however, the contractor can do so and thus create a basis for extensive potential claims for additional remuneration or objections to penalties, etc.
To exclude such risks for project owners, it is therefore advisable to actually agree on the VOB as a whole and to refrain from modifying provisions or, especially if one is oneself the user of the contractual set of clauses, to have a legal review carried out in advance. For a court-ordered conversion to the BGB is highly relevant for both contractual partners, since comprehensive changes, e.g. in respect of liability for defects, variation management, limitation periods, acceptance, and the consequences of termination, and much more, arise in a significantly more conflict-prone manner for both sides.
Critical assessment of the amended ZTV
Against this background, the question regarding the recently published and highly controversial amended ZTV pipe lining, to what extent this additional technical contract specification constitutes an intervention in the balanced VOB structure and overrides the privileged status of the VOB compared with the BGB, is quickly answered.
Because various points catch the eye of us construction practitioners when reviewing the revised ZTV. In this report, however, only the most serious aspects are to be mentioned and possible solutions described.
The author of the amended ZTV Schlauchlining was legally very well advised to issue a disclaimer of liability for the eliminated VOB privileging of the construction projects into which the clauses of the amended ZTV were incorporated. He was also well advised to exclude liability in the event that the clauses of the amended ZTV do not withstand review under the standard terms and conditions control and are therefore ineffective. For with the following two examples alone, the result of the review is easy to predict.
Example 1: Uncalculable risks for the contractor
Accordingly, under VOB/A §7 para. 1 no. 3, the contractor must not be burdened with an unusual risk for circumstances and events over which he has no influence and whose effect on prices and deadlines he cannot estimate in advance.
However, the mod. ZTV defines technical characteristics and specifications as an agreed quality, which are only to be specified in product-related terms after the order has been placed. For example, the installation lengths (unclear by whom and to what extent) are only to be limited after the contract has been awarded.
However, this clause means that the tender documents are not specified in sufficient detail and comprehensively for submitting a bid in order to calculate the work to be performed clearly. This can lead to problems, such as the assumption of risks and contractual consequences, up to and including potential contract amendments.
However, it is decisive that a clearly execution-ready design is submitted which protects the Contractor from execution risks, avoids distortions of competition, and ensures the quality of the construction work.
Example 2: Conflict with intellectual property rights and data disclosure
The transfer of data and process manuals, measurement and process data, analyses, and their disclosure to third parties described in the mod. ZTV conflicts with the intellectual property rights of the material manufacturers.
Data transfer should therefore be safeguarded by confidentiality measures and limited solely to the purpose of construction supervision and quality assurance. However, this entails legal effort.
In any case, the confidentiality obligation of the client described in the amended ZTV is clearly not sufficient for legally secure protection of the manufacturers' property rights. The contractor is thus burdened with the risk of recourse claims to be borne due to misuse of data, because only the contractor has a contractual relationship with the manufacturer.
Conclusion and recommendation for action
I will spare readers here further lists of the various ambiguities, risks, and violations of the VOB in the use of this mod. ZTV, but I will add that the review of standard terms and conditions for damage minimization for the users of this document should have been carried out in advance by the protagonists of the initiative.
I therefore strongly recommend once again avoiding isolated solution approaches and acting together with all protagonists in the committees established for this purpose. Germany is very well represented in the ISO committees by a diverse range of experts from planning, industry, institutes, and associations — everyone can take part here, and well-intentioned proposals can be placed without difficulty.
We have excellent sets of rules - let us bundle them and further develop them together in the spirit of the matter.
Because one thing is clear: many of the aspects of the mod. ZTV are not nonsense, and they serve the common goal of a sustainably sound solution for the rehabilitation of our underground infrastructure. Instead of regulating technical requirements through national contracts or associations, they should be incorporated directly into the relevant ISO product standards. For the recognized state of the art, as a generally accepted rule of technology, has a direct effect in the definition of defects under Section 13(1) VOB/B and Section 633(2) BGB, without burdening the contractual balance.
This approach is consistent with the contractual legal system and completely avoids the stated risks under standard terms and conditions law. Participation in standardisation at ISO level would be the constructive path here, which at the same time involves all parties on an equal footing. If one or the other from the operator and manufacturer side now rises above their own shadow, the controversy would be resolved in this way and the state of the art would be advanced together with all parties involved – Made in Germany - on an equal footing.
