For B2B works, section 377 UGB may require quick action.
Businesses must inspect goods or works after delivery and give notice of defects without undue delay. Otherwise claims may be lost.
Construction defects
Business notice of defects on construction projects: section 377 UGB, inspection and evidence
Business notice of defects in construction: section 377 UGB, inspection, notice and evidence for B2B works.
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15 July 2026 · Mag. Bernhard Brandauer, Rechtsanwalt
Different rules apply between construction companies, subcontractors and suppliers than in a private building owner case. In two-sided business transactions, section 377 UGB can decide whether warranty and damages claims remain available.
On construction sites deliveries, materials, partial works and subcontractor works are often accepted under time pressure. Anyone who inspects defects late or complains only verbally risks a weak evidentiary position.
This article distinguishes business notices of defects in construction from general construction defects and shows which inspection and documentation are practically important.
Assess B2B defects
Must you give notice immediately under section 377 UGB?
Two questions classify role, inspection and evidence.
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Are both parties acting as businesses?
Section 377 UGB requires a two-sided business transaction.
All paths at a glance
Overview of all answers.
The role question decides whether section 377 UGB applies.
If it is unclear whether a two-sided business transaction exists, contract, invoice, order and business purpose should be checked. Then the duty to give notice can be classified.
Without inspection and written notice, evidentiary risk increases.
Secure photographs, delivery notes, protocols, emails and the condition of the work. Then a specific notice should be sent or assessed without delay.
Why section 377 UGB matters on construction sites
Why section 377 UGB matters on construction sites
Section 377 UGB concerns business transactions. If a construction company buys material, accepts a delivery or instructs a subcontractor, the inspection and notice duty can become decisive.
The core rule is strict: goods or work must be inspected after delivery to the extent feasible in the ordinary course of business. If a defect appears, notice must be given without undue delay.
If this duty is breached, the goods or work may be deemed approved. Warranty and damages claims can then be lost.
Prove inspection, photographs and receipt of notice
Prove inspection, photographs and receipt of notice
On construction sites, a spontaneous complaint is often not enough. What matters is when the defect was recognisable, who saw it, how it was documented and when the other party received notice.
Photographs with date, delivery notes, inspection protocols, site diaries and an email or letter with a specific defect description are useful. The notice should name the defect so the other party can react.
The general construction defect notice is discussed in our article on notice of defects and deadlines.
Separate B2B notice from private defects
Separate B2B notice from private defects
Private building owners do not lose warranty simply because they do not give notice immediately. For businesses, the position can be different. This distinction determines tactics, deadline pressure and evidence.
Construction specific issues arise with material deliveries, defective preliminary works, subcontractor mistakes and series defects. Warranty, damages, recourse and remuneration claims must be considered together.
See also our articles on defective building materials and warranty and damages for construction defects.
Comparison
Private defect and B2B notice of defect
The differences matter for timing and evidence.
| Case | Legal focus | Practical consequence |
|---|---|---|
| Private owner Warranty under ABGB, evidence and period | Prompt notice useful, but no general section 377 UGB notice | |
| Business transaction Inspection and notice under section 377 UGB | Late notice can cost claims | |
| Subcontractor Works, preliminary works and recourse | Notice and evidence must fit the site chain |
The application of section 377 UGB depends on contract, performance and recognisability of the defect.
Process
Safe reaction to B2B construction defects
The process links inspection, notice and evidence.
- 01Step 1after delivery01Step 1after delivery
Inspect performance
Check acceptance and defect.
Inspect delivery, materials or subcontractor work as quickly as the ordinary course of business permits.
Legal bases: section 377 UGB
- 02Step 2on discovery02Step 2on discovery
Document defect
Secure photos, protocols and witnesses.
Document defect, timing, participants and effects on the construction site.
Legal bases: section 377 UGB
- 03Step 3without undue delay03Step 3without undue delay
Give specific notice
Send notice in provable form.
Describe the defect specifically and send the notice in provable form to the correct contract partner.
Legal bases: section 377 UGB
Practical tip: Businesses should set up a fixed inspection and notice routine for deliveries and subcontractor works. Waiting until the final invoice is often too late under section 377 UGB. You can book an initial consultation (72 euros).
FAQ
Business notice of defects in construction: frequent questions.
Can section 377 UGB apply to construction works? +
Section 377 UGB can be relevant in two-sided business transactions, including material deliveries, works or subcontractor services. Whether it applies depends on the contract and performance.
How quickly must a business give notice? +
The defect must be notified without undue delay after inspection or discovery. What this means depends on the individual case, the nature of the defect and the ordinary course of business.
Is a verbal complaint on site enough? +
That is risky. For a later dispute the notice should be specific, written and provable. Photographs, protocols and proof of receipt are important.
Further reading
Further topics on construction defects
Notice of defects and deadlines
How construction defects are reported and which deadlines run.
Defective building materials
Who may be liable for defective materials, supply issues and installation.
Warranty and damages
How construction defects are classified and claims prepared.
Completion notice and use
Why occupation after completion should be legally secure.
Topics
Notice of defectssection 377 UGBConstruction businessSubcontractorEvidence
Defects, a remuneration dispute, looming litigation?
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