The situation
The company’s standard terms of sale
A Linz manufacturer of hydraulic valves sells to machine builders in Austria and Germany on its own standard terms of sale. The terms shorten the warranty to twelve months, limit remedies to repair or replacement and exclude liability for consequential loss. A large German customer has pushed back, and sales asks whether the terms would hold anyway.
Counsel needs a clause-by-clause answer for both countries. Standard terms between businesses are controlled differently in each, the notice-of-defect rules sit in the commercial codes, and the CISG may quietly govern the sale. The time goes on checking each clause against each layer and saying which would fail.
What the research has to settle
The rules behind the answer
- Which law, and the CISG beneath it
- Without a choice of law, a sale of goods is generally governed by the law of the seller’s country under the Rome I Regulation. Between Austria and Germany the CISG also applies unless the terms exclude it, and its notice and remedy rules then govern.
- German control of business terms is strict
- German courts review standard terms between businesses for unreasonable disadvantage and use the consumer clause lists as guidance. Excluding liability for injury to life, body or health, or for gross negligence, generally fails even between businesses.
- Austrian law voids grossly disadvantageous terms
- Austrian law treats an ancillary term in standard terms as void if it grossly disadvantages the other party. Between businesses, warranty can be limited more freely than with consumers, within that limit.
- Notice of defects can decide the claim
- Both commercial codes require a business buyer to inspect delivered goods and give notice of defects in time, or lose its claims. Terms that tighten or relax this are tested in the same way as the warranty clauses.
How it runs in azta
From the question to the document
The question, as you would type it
Austrian manufacturer selling valves to German and Austrian machine builders on standard terms. Clauses: 12-month warranty, repair or replacement only, no liability for consequential loss. Austrian law chosen, CISG not excluded. Do these clauses hold against German and Austrian customers, and how does notice of defects work?
You start with
The company’s standard terms of sale
- 01
Upload the terms
Add the terms of sale and, if you have it, the customer’s objection. azta reads them and points to the clauses it relies on.
File upload· Pro - 02
Research each clause under both laws
Ask how each warranty and liability clause stands under Austrian and German law and the CISG. azta cites the codes and the convention.
Cited research· Free - 03
Find the decisions on business terms
Ask for German and Austrian decisions on warranty and liability limits between businesses. azta summarises them and links each one.
Case-law search - 04
Draft the check and new wording
Ask for a table of clauses, the risk in each country and replacement wording. Edit it in Canvas.
Canvas · Ask azta· Pro You send
A clause-by-clause check of the warranty and liability limits, with replacement wording
What you get
A clause-by-clause check of the warranty and liability limits, with replacement wording
Clause review · draft
Terms of sale: warranty and liability clauses
Governing law. The terms choose Austrian law but do not exclude the CISG. For sales to German and Austrian customers the Convention therefore governs the warranty, notice and remedies, and Austrian law governs whether a clause is valid. We recommend deciding expressly whether to keep or exclude the Convention.
Clause 8.1, twelve-month warranty. Shortening the period for business customers is generally possible. If the Convention is excluded, the clause is tested under Austrian law for gross disadvantage. Our assessment is that it can stand for new industrial goods, subject to the decisions listed in the annex.
Clause 8.4, consequential loss. As drafted it also excludes liability for gross negligence and personal injury. That goes further than the courts in either country are likely to accept in standard terms. We propose carving out intent, gross negligence and personal injury.
Outcomes on your numbers
What azta is worth on this task
Pro pays for itself after
14 minutes a month
At €120 an hour, that is all the time Pro (€27 a month) has to take off your desk to cover its price.
Example figures. Replace them with your own.
- Hours back a year
- 22
- Capacity at your rate
- €2,592
- More terms-of-sale reviews a quarter
- 0.7
- Return on Pro
- 8×
- Research
- Drafting
- Your review
A scenario you set, not a promise. The hours that come back go to another client, or deeper into this one.
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- RIS
- Gesetze im Internet
- Rechtsprechung im Internet
What stays with you
- The commercial decision on how much risk to carry.
- Negotiating with the German customer.
- The final wording of the terms you publish.
Frequently asked questions
- Can it check our terms for other customer countries?
- Yes. Name the countries and azta checks each clause under each law, citing the national provisions and decisions.
- Does azta suggest new wording?
- Yes. Ask for replacement wording for the clauses at risk. You review it and decide what goes into the terms.
- Are our terms used to train models?
- No. Uploaded documents are never used for training on any plan, and they stay in the EU/EEA.
