Published online by Cambridge University Press: 10 August 2009
A tells his friend, B, that he wants a house built on his (A's) land, but he cannot see how he will be able to afford the normal, full costs of having the house built. B, who runs a building firm, tells A that he would be able to find the time to undertake the job, and would be able to do it for a price which is lower than a commercial building firm would charge. While A and B are still in negotiation as to the price and other details about the final scope of the works, B starts the building work. When the house is nearly complete, A breaks off the negotiations because he finds that he cannot afford even the (lower than commercial) price which B wants to charge. What liability (in contract, tort, restitution, or any other form of liability), if any, does A have to B?
Under Austrian law the facts of this case will not lead to the application of the rules of civil liability, whether contractual or non-contractual, since there are specific provisions within the chapters of the ABGB on property law that deal with ‘constructions on another person's land’.
The relevant provisions in the Austrian codification are §417, dealing with the construction of buildings on one's land with materials of another; §418, on the construction of buildings on the land of another with one's own materials; and §419, on the construction of buildings on the land of another with another person's materials.