Subsequent performance: Where does it take place?

If, after buying something, a buyer determines that the purchased item is defective, the buyer can demand from the seller the remedy of the defect or the delivery of a new item (“subsequent performance”). To do so, the buyer must duly request the seller to render the subsequent performance. The buyer not only has to report the defect but must also specify the place where the seller is to render the subsequent performance. The buyer must thereby grant the seller the opportunity to verify the alleged defect in the merchandise at this place.

Just how important it is to specify the right place of performance becomes evident from the legal consequences of providing false information. Not only the right to subsequent performance (as described above) but also the subsequent claims are contingent on an orderly request for the subsequent performance. If the subsequent performance fails or is omitted, the buyer may reduce the purchase price, rescind the contract or demand damage compensation. Yet, the buyer must have duly requested the seller beforehand to render the subsequent performance and also have set a reasonable deadline for the seller to do so. This applies not only to purchases by consumers but also to sale contracts between two merchants.

Exactly where the subsequent performance is to be rendered is determined according to the circumstances of the specific case, e.g. in accordance with the place of the main performance duty (delivery to the customer, delivery ex works, etc.) and the type of contract (contract between merchants or between a merchant and a consumer). The Higher Regional Court of Duesseldorf likewise confirmed this in a recent decision (judgment of 8 September 2016, Case I-5 U 99/15). In the case of a delivery ex works, for example, this can mean that the item must be sent back to the seller for inspection.