HOAI minimum rates apply to all contracts concluded before 2021!

In rulings dated June 2, 2022 (Ref. VII ZR 174/19, VII ZR 12/21 and VII ZR 229/19), the Federal Court of Justice (BGH) decided that the binding price law of the HOAI 2013 (and thus also the predecessor versions 2009 and 2002/1996) continues to apply between private parties. As a result, contractors (planners) can continue to demand the minimum rate on the basis of old contracts and, if necessary, enforce it in court (so-called minimum rate top-up actions). In addition, the BGH has clarified that the written form clause of Section 7 (5) HOAI 2013 also continues to apply. Thus, fee agreements deviating from the minimum rates can only be concluded with legal effect “in writing when the contract is awarded”, so that this temporal component must also continue to be observed in this respect.

The BGH thus follows its view from the decision of 14.05.2020, which had already been expressed from its questions to the ECJ on the unlawfulness of the binding price law of the HOAI (2013) under EU law. In this regard, the ECJ had ruled on January 18, 2022 (Case No. C-261/20) – surprisingly for many – that German courts may continue to apply the HOAI minimum rate regulations of the 2009 and 2013 versions, which are contrary to European law.

Consistently, the BGH confirms in its new decisions that the assertion of the minimum rate in particular is not contrary to good faith and thus inadmissible because the national legal provision from which the claim is derived violates a European Union directive. On the contrary, a (private) party may in principle rely on a national legal provision as long as it remains valid and applicable in the relationship between the parties.

Thus, in principle, an interpretation of the national legal provisions in conformity with Union law must take place. In the specific case, however, such an interpretation of Section 7 HOAI (2013) in conformity with the Directive (here: with regard to the European Services Directive (2006/123/EC)) was not possible, since this would lead to a non-application of the provision and thus the scope of interpretation would be exceeded. For, an interpretation in conformity with Union law must not undermine the national law (contra legem), in particular by imposing an additional obligation on a private person or taking away a right by not applying the national law. However, this would be precisely the case here, as the mandatory price law of Section 7 HOAI 2009/2013 could then no longer be applied at the expense of the planner.

Therefore, the binding minimum rate law of the HOAI can continue to be applied even in the event of a breach of Union law, i.e. the minimum rates of Section 7 HOAI (2013) continue to apply between two private parties.

In the author’s opinion, however, this must apply a fortiori to contracts with the public sector as the client, since the public sector is even less in need of protection than a private client. The public contracting authority must accept responsibility for the fact that the Federal Republic of Germany initially failed to implement the Services Directive properly.

The starting point of the case law referred to here is the judgment of the ECJ of 04.07.2019 (Case No. C-377/17), which found that the minimum rate regulations of the German HOAI violate the European Services Directive (2006/123/EC). The Federal Republic of Germany had thereupon – in belated implementation of this directive – deleted the binding minimum rate regulations from the HOAI. However, this change only applies to contracts that were or will be concluded after January 1, 2021.

The legal question that has now been decided is whether the minimum rate regulations continue to apply to contracts concluded before January 1, 2021, irrespective of their fundamental incompatibility with EU law, i.e. whether the planner can continue to demand the minimum rates of the HOAI in accordance with the former HOAI versions. Therefore, in its decision of 14.05.2020, the BGH had submitted the question to the ECJ for clarification as to what extent the German price law (which was previously binding and contrary to European law) may continue to be applied in the case of old contracts.

In its ruling of January 18, 2022, the ECJ further stated that the party disadvantaged by the delayed implementation (i.e., as a rule the client) could in principle claim compensation from the Federal Republic of Germany for any damage caused by the delayed implementation of the Services Directive (which did not occur until HOAI 2021). However, whether under our German law a client who is still obliged to pay a minimum rate for contracts concluded before 01.01.2021, even though a lower fee had been agreed, would actually succeed with an official liability claim against the Federal Republic of Germany appears questionable due to the high hurdles for official liability claims and therefore remains to be seen.

For architects and engineers, the decision of the ECJ is in any case favorable, since contracts concluded until the validity of the HOAI 2021 (before 01.01.2021) continue to be subject to the minimum rate protection – at least for contracts with private clients, but according to the correct view also for contracts with public clients. According to the price law in force since 01.01.2021, as is well known, minimum and maximum rates no longer exist.