Glossary
Construction law from A to Z.
The key terms of Austrian construction law, explained in plain language. From warranty and retention money to the developer contract, each with links to in-depth topic pages.
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C
- Consequential damage from a defect A loss that arises not on the works themselves but on other protected interests through the defect; recoverable only on fault (section 933a ABGB).
- Contract for work A contract under which the contractor undertakes to produce a specific result (the works) in return for payment (sections 1165 ff ABGB).
- Contractor's duty to warn The contractor's duty to warn the client where the client's material or instruction is evidently unsuitable; otherwise the contractor is liable for the failure (section 1168a ABGB).
- Contractual penalty An amount agreed in advance that falls due on a breach of contract, for instance on construction delay; reducible by the court (section 1336 ABGB).
- Contributory negligence The injured party's own fault in causing the loss; it leads to a proportionate reduction of the compensation claim (section 1304 ABGB).
- Cover retention An amount withheld from interim payments already during construction, securing the client against overpayment and defects in the building phase.
D
- Damages Fault-based compensation for loss caused by a defect or breach of duty; on construction projects often alongside warranty (sections 1293 et seq., 933a ABGB).
- Default (delay in performance) The failure to render a performance due on time; in case of construction delay the client has specific remedies depending on the situation (sections 918 et seq. ABGB).
- Duty to give notice of defects In dealings between businesses, the duty to give notice of defects without undue delay; if missed, the goods are deemed approved (section 377 UGB).
H
- Handover The acceptance of the completed works by the client; a key moment for the remuneration falling due, the passing of risk and the start of the warranty period.
- Handover protocol A written record of the acceptance of the works documenting defects, reservations and meter readings; an important basis of evidence.
- Hidden defect A defect that was not recognisable at acceptance and only appears later; acceptance does not exclude claims for it.
I
- Immission An interference from one plot of land on the neighbouring plot, for instance by noise, dust or vibration; neighbour law sets limits to it (section 364 ABGB).
- Instalment plan A security model under the BTVG in which the purchaser makes payments only according to construction progress, in instalments fixed by law (section 10 BTVG).
L
- Limitation period The lapse of time after which a claim can no longer be enforced; damages claims are generally time-barred three years after knowledge (section 1489 ABGB).
- Lump-sum price A fixed price for a precisely described construction service; the quantity risk is generally borne by the contractor.
P
- Preservation of evidence A procedure to secure evidence before it is lost, for example where a defect is about to be built over (sections 384 ff ZPO).
- Price reduction A secondary warranty remedy: reduction of the remuneration in line with the reduced value of the defective works, without dissolving the contract (section 932 ABGB).
- Property developer contract A contract for the acquisition of property still to be built or substantially renovated, involving advance payments; governed by the Developer Contract Act (BTVG).
R
- Remuneration for the works The contractor's payment for the works produced; in principle due only on completion of the works (section 1170 ABGB).
- Repair (cure) The primary warranty remedy: the contractor removes the defect by repair or replacement, free of charge for the client (section 932 ABGB).
- Rescission A warranty remedy leading to the reversal of the contract; available only for defects that are not merely minor (section 932 ABGB).
- Retention money A portion of the remuneration withheld by the client during the warranty period as security for defects; typically a few percent of the final invoice.
- Reversal of the burden of proof Presumption that a defect emerging within six months of handover already existed at handover (section 924 ABGB).
W
- Warranty The statutory, fault-independent liability of the contractor for defects that the works already had at handover (sections 922 et seq. of the Austrian Civil Code, ABGB).
- Warranty period The period within which warranty claims must be enforced: three years from handover for buildings and other immovable property (section 933 ABGB).
This explanation gives a general overview of Austrian law and does not replace advice in an individual case. The specific circumstances of your construction project are always decisive.
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