THE DREAM OF OWNING YOUR OWN HOUSE.
LIMITATION PERIOD FOR CLAIMS FOR WORK WAGES: WHAT APPLIES?
19.10.2017
To ensure that the dream of owning your own home does not turn into a nightmare, there are a few things to consider when building a house. In addition to construction defects and bankruptcy, the biggest risks when building a house include an explosion in costs. To avoid exceeding financial means, many builders opt for a flat rate.
This also entails risks for the building contractor. On the one hand, the building contractor bears the risk of cost overruns and, on the other hand, flat rates are subject to their own statute of limitations.
If no flat fee has been agreed, the claim for remuneration for work generally expires three years after the invoice is issued. As soon as the invoice is objectively possible, it should be issued within the usual period of time. Otherwise, the limitation period begins from the time at which the invoice was objectively possible. The idea behind this is that the entrepreneur cannot arbitrarily postpone the due date and thus the start of the limitation period by delaying the invoice.
If a date is contractually specified for the accounting, this date is decisive for the start of the limitation period.
The situation is different when a flat rate is agreed: separate invoicing is not necessary because the client knows from the outset how much he owes the building contractor after the work has been completed. The limitation period when a fixed price is agreed therefore begins when the house is completed.
Special rules apply when billing for individual partial services. According to § 1170 sentence 2 ABGB, if the work is carried out in certain sections, the contractor is entitled to demand a proportionate part of the payment in advance. Such division into sections can occur, for example, if the individual part can be regarded as an independent work. Partial services are not subject to a separate limitation period. The limitation period for partial services does not begin when the interim invoice is due. Rather, they expire with the final invoice.
Conclusion: Knowledge of the limitation rules mentioned is essential for every construction company. Although the limitation of a claim does not lead to its extinction, it becomes a so-called natural obligation and can no longer be asserted by means of legal action.