Author Archives: Patrick Maydell

By Mag. Patrick Maydell, LL.M. – lawyer and trained motor mechanic

At a glance: A defect may entitle you to reverse a car purchase. When a consumer buys from a dealer, repair or replacement generally takes priority. Cancellation of the contract may be available, for example, where a remedy is refused or unsuccessful, or a defect is particularly serious. A merely minor defect is insufficient. In a private sale, it is also necessary to check whether statutory warranty liability was validly excluded.

What is wrong with the car – and what rights does that give you? As a lawyer and trained motor mechanic, I combine the technical and legal assessment.

Would you like to return your car because of a defect? Call me for a free initial telephone assessment on 01/2954251, or email office@maydell-law.at.

1. Can I return my car because of a defect?

A defect in the legal sense exists where the car does not have the agreed characteristics or meet the requirements that can reasonably be expected. For a used car, its age, mileage, price, description and disclosed damage are particularly relevant.

Wear consistent with the car’s age must be distinguished from a defect. However, a component subject to wear is not automatically excluded from statutory warranty protection: its condition must meet the agreed requirements and reasonable expectations.

Possible disputes include engine and gearbox damage, excessive oil consumption, serious corrosion, undisclosed accident damage or mileage that differs from what was represented. For electric cars, the agreed battery condition or specific range promises may also be relevant. A shorter range in winter does not, by itself, prove a defect.

Statutory warranty liability generally requires neither fault nor knowledge on the seller’s part. As a rule, the defect or its underlying condition must already have existed at delivery. Damage subsequently caused by misuse is not covered.

2. Buying from a dealer: must I first allow a repair?

Since 2022, the Austrian Consumer Warranty Act (VGG) has generally applied to car purchases by consumers from businesses. Older contracts and business purchases must be assessed separately. An additional commercial guarantee does not replace statutory warranty rights.

In principle, you may first request repair or replacement. Your choice is restricted if one option is impossible or disproportionately costly compared with the other. An equivalent replacement is not always possible for an individually specified used car, so repair is often the main remedy. The statutory order of remedies is set out in section 12 VGG.

The remedy must be provided within a reasonable time, free of charge and without significant inconvenience. There is no universal rule allowing two or three repair attempts in every case.

Notify the seller of the defect and, in principle, allow inspection and a remedy. Commissioning a repair on your own initiative may make claims and evidence more difficult. If the car cannot be driven, clarify transport arrangements and costs in advance.

3. When may I actually cancel the purchase contract?

In a consumer purchase from a dealer, moving to a price reduction or cancellation may be permitted, in particular, where:

• the defect is sufficiently serious to justify immediate cancellation;
• the dealer refuses to bring the car into conformity;
• the dealer’s statements or the circumstances show that the defect will not be remedied in time or without significant inconvenience;
• the remedy is not carried out properly or the reasonable period expires;
• a defect still occurs despite an attempt to repair it.

Cancellation is unavailable for merely minor defects; doubts as to whether a defect is minor are resolved against the business. In addition, one of the statutory grounds for moving to cancellation must be present. The legal basis is section 12(4) and (5) VGG.

Even with engine damage, therefore, the repair bill alone is not decisive. Available remedies, the dealer’s response and the burden caused by the repair also matter. There is no fixed monetary threshold for returning the car.

Under the VGG, cancellation of the contract, often also called Wandlung, takes effect by a declaration to the seller. For evidential purposes, make the declaration in writing and explain the reasons. If the seller objects, court proceedings may be necessary. Agree the return arrangements rather than simply leaving the car at the dealership.

4. Private purchases: what does “no warranty, no returns” mean?

Statutory warranty rights under the Austrian Civil Code (ABGB) generally also exist in private sales. However, private contracting parties can exclude them to a considerable extent. The precise contract wording, the advertisement and statements made before the purchase are therefore particularly important.

A comprehensive warranty exclusion may also cover hidden defects. The fact that you could not identify the damage during inspection does not, by itself, invalidate the exclusion. In principle, however, it does not cover characteristics expressly or implicitly assured, nor does it protect against the consequences of fraudulent concealment.

“No guarantee” and “no returns” do not necessarily exclude statutory warranty rights. They may refer to an additional commercial guarantee or a voluntary return arrangement. The interpretation of the agreement as a whole is decisive.

If the car was represented as accident-free, the precise scope of that statement and the actual previous damage must be examined. Not every advertisement contains a comprehensive assurance. Preserve the advertisement and messages early.

Where statutory warranty rights are available, the ABGB also generally requires repair or replacement to take priority, followed by price reduction or cancellation. Exceptions must be assessed under section 932 ABGB; the VGG rules cannot simply be applied unchanged to a private purchase.

Other possible grounds include avoidance for mistake, fraudulent misrepresentation or laesio enormis, a shortfall exceeding half the value. The latter generally requires the car’s value at the time the contract was concluded to have been less than half the purchase price. Under section 934 ABGB, the seller may avert cancellation by making the corresponding adjustment in value; section 935 ABGB contains exceptions. A high repair bill alone does not establish this value ratio.

5. Engine damage, electronic faults and accident damage: what matters?

The following three cases come from my practice and are presented without naming the parties. They illustrate how technical investigations can help clarify disputed vehicle defects. The first two cases are described in more detail in separate articles.

Case study 1: VW T5 Multivan with greatly increased oil consumption

A used VW T5 Multivan showed high oil consumption shortly after delivery. The dealer denied that a defect had existed at delivery and refused a repair. During court proceedings, a consumption test drive recorded oil consumption of 2.3 litres per 1,000 kilometres. The expert attributed the damage to worn cylinder bores and piston rings and considered that it had developed over a longer period.

The case illustrates how measurement can clarify the cause of damage and when it developed. Whether the expert’s report also supports cancellation requires a separate legal assessment.

I explain the case and the importance of the consumption test in VW T5: high oil consumption and refusal of statutory warranty remedies.

Case study 2: Hyundai Bayon with repeated battery discharge

A Hyundai Bayon repeatedly failed to start after longer periods parked because its battery had discharged. Despite several battery replacements and other repairs, the cause remained disputed. The dealer and importer denied a technical defect during the proceedings. At the court-appointed inspection, a longer quiescent-current measurement showed unusual fluctuations, whereas a comparison vehicle reached a stable, low resting current.

A brief workshop check can miss an intermittent fault. The repair history, the circumstances in which the problem occurs and the measurement method are therefore important for the evidence. The published article describes the expert evidence in ongoing proceedings, not a successful reversal established by a final judgment.

More on the investigation and the procedural position described: Hyundai Bayon: repeated battery discharge and abnormal quiescent current.

Case study 3: undisclosed accident history of an Audi A5

In a case from my practice, a client bought a used Audi A5 Sportback from a private seller. On the very next day, an independent motor mechanic found indications of accident damage and repainting. My client alleged that the accident history had not been disclosed before the purchase, either in conversation or in the contract. In the proceedings, the seller relied, among other things, on an alleged exclusion of statutory warranty liability.

The court-commissioned expert’s report documented several instances of previous damage. Restoration costs exceeding EUR 11,000 were recorded for the most serious documented damage, affecting the left rear of the vehicle. On inspection, the expert also found extensive repainting and clearly inconsistent panel gaps. The assessment therefore drew on both the documented damage history and the vehicle’s actual condition on examination.

My client seeks cancellation of the purchase contract and repayment of the price against return of the car. The court must assess whether the seller fraudulently concealed the accident history; the technical findings alone do not decide that question. No final judgment was available in the case file reviewed.

6. Who must prove that the defect existed at delivery?

In a consumer purchase governed by the VGG, a defect that becomes apparent within one year after delivery is generally presumed to have existed at delivery. The presumption does not apply where it is incompatible with the nature of the goods or the defect. The seller may also rebut it.

You must be able to prove that a defect became apparent within that year. After that period, you generally also have to establish that the defect or its underlying condition existed at delivery. The presumption period must be distinguished from the statutory warranty period.

For private purchases under the ABGB, the statutory presumption period is generally six months. However, a valid warranty exclusion may already remove the basis for the claim.

Document the first symptoms as soon as they appear. Workshop visits, written complaints and photographs of warning messages help establish the sequence of events. Distinguish your observations from a cause of damage that has not yet been established.

7. What time limits apply to reversing the purchase?

A consumer purchase of a car is generally subject to a statutory warranty period of two years from delivery. For used vehicles, a reduction to one year is only valid if individually negotiated and more than one year has passed since first registration. A blanket statement such as “used cars: one-year warranty” is therefore not automatically sufficient.

Under section 28 VGG, statutory warranty rights and claims arising from price reduction or cancellation generally become time-barred three months after the relevant warranty period expires. This is not an additional period during which any new defect may first appear. Merely making a complaint does not automatically preserve the limitation period. Have the deadline checked in good time, particularly if discussions with the seller continue for a lengthy period.

For private purchases, the contract and any exclusions or agreed time limits must also be examined. Repairs, acknowledgements and other circumstances may affect the calculation of the applicable deadlines.

Change already enacted: for contracts concluded from 1 October 2026, the warranty period under the VGG is extended once by one year where a repair is carried out under section 12(2) VGG. The new rule does not apply generally to all older car purchases. Its basis is the Austrian Act implementing the Directive on the Repair of Goods (Warenreparaturrichtlinie-Umsetzungsgesetz).

8. How much money will I get back – and must I pay for mileage?

Where the contract is validly cancelled, the purchase is reversed: you return the car and the seller refunds the price. Under the VGG, the business bears the costs of return and may generally withhold repayment until it receives the vehicle or evidence that it has been sent back.

There may also be a dispute over compensation for using the car. Whether a deduction is justified, and in what amount, requires a separate assessment. Do not accept a dealer’s flat mileage charge without checking it.

For a mileage-based calculation, the purchase price, kilometres driven and expected remaining mileage at delivery are particularly relevant. The specific car’s condition and mileage matter. The amount refunded may therefore differ from the original purchase price.

I explain the calculation and common points of dispute in Usage compensation when reversing a car purchase.

Towing costs, diagnostic costs, repairs already paid for and other losses must each be assessed separately. Cancellation alone does not automatically make them recoverable. Where the purchase was financed, coordination with the credit agreement must also be clarified.

9. What should you do now?

• Avoid damage and danger: do not simply keep driving if warning signs appear or roadworthiness is in doubt. Obtain technical assistance and document the reason and the vehicle’s condition.
• Preserve documents: collect the purchase contract, advertisement, messages, delivery date, mileage readings, service records, invoices and workshop findings.
• Inform the seller in writing: describe the symptoms, when they first appeared and the steps already taken. Keep a verifiable record of receipt of your message.
• Clarify inspection and the remedy: in principle, allow an opportunity to inspect and provide the remedy owed. Where urgent action is needed, coordinate it beforehand if possible and document the urgency.
• Preserve evidence: avoid unnecessary disposal of removed parts or avoidable changes to the vehicle’s condition before securing evidence. An expert examination may be useful where there is a dispute.
• Check the claim, deadlines and costs: before a final cancellation declaration or settlement, establish what can be claimed and which course of action makes financial sense.

Four details are particularly helpful for an initial legal assessment: who sold the car, when it was delivered, what defect occurred and how the seller responded. Add the purchase price, mileage readings and any findings already available.

10. What does enforcing my claims cost?

Costs depend, among other things, on the amount in dispute, the extent of the legal work, the technical evidence and any court proceedings. In addition to legal fees, court fees and expert costs may arise.

A party who loses civil proceedings entirely must generally also reimburse the opposing party’s necessary litigation costs. Reimbursement follows statutory rules and tariffs; it does not necessarily cover every expense actually agreed.

Legal expenses insurance may cover costs depending on the policy. Before taking steps that incur costs, clarify cover, any excess and possible exclusions. Having a policy does not mean that every dispute is automatically covered.

Whether a repair, price reduction, settlement or court proceedings make sense therefore depends not only on the legal position, but also on the evidence and the financial outcome.

Lawyer and motor mechanic: assessing your case legally and technically

I assess the contract documents and technical findings together: which claims may be available, what evidence is missing and what course of action makes sense?

My training as a motor mechanic helps me identify the decisive technical questions. It does not replace an expert’s report where one is required.

Would you like to have your options assessed? Contact me for a free initial telephone assessment. The document checklist above will help you prepare.

Mag. Patrick Maydell, LL.M. · Lawyer and trained motor mechanic

Telephone: 01/2954251 · Email: office@maydell-law.at

Neustiftgasse 17/1/9, 1070 Vienna

Frequently asked questions about buying a defective car

Can I return a used car to a dealer?

Yes, where there is a defect for which the dealer is liable and the requirements for cancellation are met. Often, an opportunity to provide a remedy must be given first.

Can I withdraw even though I have signed the purchase contract?

Yes, statutory rights relating to defects exist even after a contract has been signed. A mere change of mind, however, generally does not entitle you to withdraw.

Is there a 14-day right of withdrawal when buying a car?

There is no general 14-day right of withdrawal for an ordinary purchase at a dealership or from a private seller. Such a right may exist under section 11 of the Austrian Distance and Off-Premises Contracts Act (FAGG) for distance contracts or consumer contracts concluded away from business premises, subject to statutory exceptions. Finding an advertisement online does not, by itself, make a purchase subsequently concluded at a dealership a distance contract.

Is engine damage enough for an immediate reversal?

Not automatically. The cause, severity and available remedies are decisive. A particularly serious defect may justify immediate cancellation in a consumer purchase.

How many times must I let the dealer repair the car?

There is no fixed number applicable to every case. The statutory requirements, the particular defect and the course of previous remedial work are decisive.

Do I have rights in a private purchase despite a warranty exclusion?

That may be the case, for example, where assured characteristics are missing or damage was fraudulently concealed. However, a comprehensive exclusion may also cover hidden defects. The contract, advertisement and assurances must be considered together.

Who must prove that the defect already existed when the car was bought?

Delivery is generally the decisive point. The VGG generally provides a one-year presumption period, and the ABGB generally provides six months. The requirements, exceptions and possibility of rebuttal must still be considered.

How much is usage compensation?

That depends on the legal basis of the claim and the circumstances. In a mileage-based calculation, the distance driven and expected remaining mileage are particularly important. Check any proposed deduction before agreeing to it.

Mag. Patrick Maydell, LL.M., Lawyer
Neustiftgasse 17/1/9
1070 Vienna
Telephone: 01/2954251
office@maydell-law.at

Eight tips from Mag. Patrick Maydell, LL.M., Attorney at Law.

1. What are initial and subsequent heirs?

A testator can appoint an heir and also determine who receives the same assets after that heir's death. The initial heir (Vorerbe) must pass the assets originating from the testator to a subsequent heir (Nacherbe) at a specified time, such as the initial heir's death. This Austrian arrangement is called fideicommissary substitution.

This does not mean appointing the initial heir's own heir. The subsequent heir receives only the original testator's assets, not the initial heir's separate property.

The law limits the number of successive heirs to prevent assets being tied up over generations. Any number may be appointed if they are already alive when the will is made. For persons not yet alive, meaning neither conceived nor born, the testator may appoint one subsequent heir for real estate and at most two for other assets such as money.

The arrangement may cover the whole estate or only part. For example, a wife may inherit a holiday apartment, with the children to receive it after her death.

2. Rights of the initial heir

The initial heir's position resembles that of a usufructuary. Although they become owner on formal transfer of the estate and may use the asset fully, they must preserve its substance and may neither sell nor encumber it. They may dispose of it only insofar as the subsequent heir's rights are not infringed. Sale is possible where necessary to avoid damage to the asset.

The initial heir may enter into longer-term leases. Acting together, the initial and subsequent heirs may dispose of the asset without restriction, including selling or encumbering it, and may terminate the substitution arrangement.

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3. Rights and protection of the subsequent heir

The subsequent heir becomes owner only when the initial inheritance ends. The timing primarily depends on the testator's wishes. Nevertheless, the subsequent heir already has protective rights against the initial heir, including a preventive injunction if the assets are intentionally damaged, for example deliberately damaging a house to reduce its value.

An inventory must be drawn up ex officio to safeguard the assets. For real estate, the substitution is also noted in the land register as a Substitutionsband.

4. Who pays the expenses?

Expenses relating to property or other assets are allocated according to their nature: those normally borne by a usufructuary fall on the initial heir, while those borne by an owner fall on the subsequent heir.

5. Do the initial heir's restrictions bind third parties?

If the initial heir breaches the automatic prohibition on sale or encumbrance, for example selling without the subsequent heir's consent, or otherwise infringes that heir's rights, the prevailing view is that the disposition is invalid against third parties too.

6. Can creditors reach the property?

Creditors of the original deceased or estate may proceed against the estate without restriction. The existence of a subsequent inheritance cannot be raised against them.

The initial heir's own creditors cannot seize the substitution assets because that heir's position is comparable to a usufructuary's. They may, however, reach rental income, for example by seeking compulsory administration of the property.

7. Substitution of the remainder

Unlike ordinary fideicommissary substitution, substitution of the remainder allows the initial heir unrestricted lifetime disposal. They must pass on only what remains at death or when the substitution event occurs. They cannot dispose of that remaining part by a disposition effective on death, such as a will or codicil.

To prevent assets remaining for the subsequent heir, the initial heir could consume them or transfer them to a third party during life. However, abuse of rights is prohibited. If disposal is solely intended to harm the subsequent heir, that heir may claim damages and seek an injunction.

8. What is an alternative heir?

A subsequent heir should not be confused with an alternative or substitute heir (Ersatzerbe). The latter inherits only if the appointed heir never becomes heir, for example because they die before the testator or decline the inheritance.

Example: “My son Hans is to inherit only if my daughter Anna dies before me.”

Free initial assessment — call now

If you have questions or need help with inheritance law, call for a free initial telephone assessment or email office@maydell-law.at.

Mag. Patrick Maydell, LL.M.
Attorney at Law
Neustiftgasse 17/1/9
1070 Vienna
Telephone: +43 1 2954251
office@maydell-law.at

This article explains the essentials of auctions of property or apartments jointly owned by several people. Experienced property lawyer Mag. Patrick Maydell, LL.M. offers practical tips and information.

Houses often belong to several people, and apartments to spouses or siblings. Siblings may have inherited a house together; spouses may have bought or built a property and wish to sell following divorce. If the co-owners cannot agree on a sale, a judicial auction may result.

1) How does a property auction work in detail?

A final judgment or binding court settlement, no longer open to appeal, is required. This typically follows a partition action in which the co-owners settled or the judge issued a judgment that was not challenged. For the conditions for a successful partition action, see Partition actions: 9 tips from a lawyer.

With a judgment or settlement, the auction is initiated by an enforcement application to the competent district court. Even if the partition proceedings took place in a regional court, the auction always takes place in the district court for the property's location.

Once enforcement is authorised, an expert values the property so the court can set a minimum bid. The court chooses and appoints the expert. Parties may comment, including raising reasons against the appointment, such as previous work for the other co-owner. The court may appoint someone else if appropriate.

The expert conducts an on-site inspection with the parties and their lawyers, takes photographs, examines the rooms and obtains necessary documents from the building authority.

The court sets the deadline for the report, usually four to eight weeks. Once submitted, the court sends it to the lawyers, who may comment and identify errors. The report also reveals the proposed minimum auction price.

2) What is the minimum price?

The minimum price is the market value. Contrary to popular belief, an auction following partition therefore does not normally involve a sale below market value, unlike an ordinary enforcement auction initiated by a bank for unpaid debt. Section 352a(3) EO sets the minimum bid at the appraised value, meaning market value.

In practice, properties auctioned after partition frequently sell above market value. Co-owners therefore need not suffer a financial disadvantage compared with a private sale.

If they disagree with the expert's figure, the co-owners can unanimously agree a higher minimum, or a lower one if they believe the valuation is too high to attract buyers. However, the minimum must not fall below three quarters of the expert's appraised value. Usually the expert's figure is retained because the owners cannot agree.

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3) What happens at the auction hearing?

The auction takes place at the district court, usually in a larger courtroom. Each prospective buyer shows identification, completes a form and presents a savings passbook containing at least the required security deposit, the Vadium. This prevents frivolous bidding without payment.

An existing co-owner may also bid. If a half-owner wishes to acquire the other half and succeeds, they need not pay the full purchase price for an interest they already own, but only the price attributable to the other half.

The judge awards the property to the highest bidder. The buyer then pays the purchase price into the court's escrow account. Once it has arrived in full, the court informs the co-owners' lawyers. The property is subsequently handed over, including the keys.

4) How are the proceeds distributed?

Before payment, the judge attempts to secure agreement between the parties. If they cannot agree, the court decides according to the relevant criteria.

Proceeds are generally distributed according to ownership shares; two equal co-owners each receive half. This can differ where one owner made investments or shares are unequally burdened by loans or mortgages, for example one unencumbered half and one mortgaged half.

5) What about investments by a co-owner?

An exception to distribution by registered shares applies to investments capable of increasing the property's value and benefiting the other owner.

For example, one owner builds a garage at their own expense with the other's consent. If it can increase the property's value and auction proceeds, the other owner would benefit without having contributed. The investing owner may ask the court to account for that investment and receive a larger amount.

It is not necessary to show that the particular buyer actually paid more because of the garage. What matters is whether the investment was objectively capable of increasing the auction proceeds.

Payments or claims arising from co-ownership but unrelated to the amount realised cannot be taken into account. For example, unpaid operating or repair costs owed by one owner to the other must be claimed in separate proceedings.

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6) How long does it take?

The time until auction depends on several factors, including how quickly the court authorises it, when it schedules the hearing and whether an opposing co-owner delays proceedings through applications. Normally, allow approximately six to nine months, and potentially longer.

7) What happens to loans and mortgages?

Mortgages generally remain after the auction. A new buyer could therefore face enforcement by the bank if the former owners fail to repay their loan.

To avoid this, the outstanding loan is often repaid to the bank from the auction proceeds and the bank issues a release for deletion of the mortgage. The buyer then acquires the property free of that mortgage, while the former owners benefit from repayment of their debt.

8) What does the auction cost?

The enforcement proceedings attract a one-off court fee calculated on the amount in dispute, often a few hundred euros depending on the case. Expert valuation fees vary with complexity, such as an apartment versus a multi-unit building, but are typically EUR 2,000–4,000 in total for all owners.

Lawyers' fees depend on work required, including submissions and hearings. They are often of a similar order to the expert fees but may vary.

Court and expert fees are shared according to ownership shares. With three equal co-owners, each pays a third. Unlike first-instance partition litigation, lawyers' fees in the enforcement proceedings are not reimbursed: each owner pays their own lawyer.

9) Do rights of residence or usufruct survive?

Yes. A right of residence or usufruct remains and must be accepted by the buyer. In practice, such a right may mean that no buyer is found.

10) Can a prohibition on sale and encumbrance prevent an auction?

A registered prohibition prevents an auction where it covers the entire property and its beneficiary does not consent. If it covers only one ownership share, for example one half but not the other, the property may nevertheless be auctioned.

11) What if the property does not sell?

If it is not sold at the first hearing, written bids may be submitted within a period of up to eight weeks afterwards. The court sets the precise deadline and publishes the details in the judicial notices database (Ediktsdatei).

Written bids may be up to 25% below the expert's appraised value. In my experience, failure to sell is uncommon, except where, for example, a right of residence burdens the property.

Free initial assessment — call now

For questions or assistance with partitioning houses, land or apartments, call for a free initial telephone assessment or email office@maydell-law.at.

Mag. Patrick Maydell, LL.M.
Attorney at Law
Neustiftgasse 17/1/9
1070 Vienna
Telephone: +43 1 2954251
office@maydell-law.at

Learn the essentials of partition actions first-hand: when an action succeeds, whether a judicial auction is inevitable and what it costs. Experienced property lawyer Mag. Patrick Maydell, LL.M. offers these practical tips and explanations.

1) Why do partition actions arise?

Partition actions arise when co-owners can no longer agree on the future of jointly owned property. A sole owner can generally do what they wish with their property, including selling it without anyone else's consent. A co-owner's freedom, however, is limited by the other owners' rights.

This form of ownership is often called “ordinary co-ownership” to distinguish it from condominium ownership. Each co-owner holds an undivided share in the whole property, for example one half or one third.

A common misconception is that a co-owner may sell their share only with the others' consent. Consent is not required to sell one's own share, but in practice such shares are often difficult to sell.

Selling the entire property is therefore often more promising. If the co-owners cannot agree, a partition action remains available, for example where one owner wants to sell and another does not.

2) How does a partition action work?

One or more co-owners bring the action in court. If the claimant seeks a judicial auction of the property, this is an action for partition by sale (Zivilteilung). If the aim is to divide it into independent units, this is physical partition (Realteilung).

By law, physical partition takes priority. The property must be divided into independent units if this is possible. A judicial auction is available only where physical partition is not an option.

The judge determines the appropriate form of partition on the basis of expert evidence. Where physical partition is possible, the court decides who receives each part, potentially subject to an equalisation payment.

If physical partition is impossible, the property must be auctioned. The defendant, the co-owner opposing partition, may argue that partition would be at an “inopportune time” or “to the detriment of the others”. Such obstacles to partition must be temporary, for example where impending changes to zoning would make immediate partition disadvantageous. Following a successful auction, the proceeds are distributed according to the ownership shares.

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3) Does a partition action always lead to an auction?

No. The parties are always free to settle. With houses, it may also be possible to establish condominium ownership if the building can be divided into independent residential units. Apartments, by contrast, cannot normally be divided into separate residential units, so an auction is generally to be expected.

4) Can an auction be prevented? What is the minimum price?

Partition may be postponed because of an inopportune time or detriment to the others, for example if partition would be disproportionate in view of an urgent housing need. There is no auction where physical partition or the establishment of condominium ownership is possible. Otherwise, the house must be auctioned.

Naturally, the aim is a good sale price. Contrary to popular belief, a judicial auction following a partition action does not normally involve a sale below market value, unlike an ordinary enforcement auction initiated by a bank for unpaid loans. Section 352a(3) of the Austrian Enforcement Code (EO) provides that the minimum bid is the appraised value, meaning the property's market value.

In practice, a judicial auction therefore normally has no disadvantage compared with a private sale, apart from taking longer. It may even achieve a substantially higher price, as the following example shows.

For a detailed account of the process, see Auctions of jointly owned property: the essentials.

In one of my cases, I arranged the auction, following a partition action, of a detached house on a 608 m² plot in Vienna's 14th district. It was appraised at EUR 440,000. There was considerable interest at the viewing, so we agreed with the other side to raise the minimum price to EUR 500,000.

The auction greatly exceeded that amount: the house sold for exactly one million euros. Afterwards, everyone agreed that such a price would not have been achieved in a private sale. The psychological pressure of competitive bidding at a public court auction, for example with 100 participants, should not be underestimated. It can lead the highest bidder to pay a price they would not have paid privately.

“Contrary to popular belief, a judicial auction can achieve a substantially higher price than a sale outside court.” — Mag. Patrick Maydell, LL.M., Attorney at Law

5) When can a house actually be divided?

There are three decisive requirements for physical partition: division into comparable parts, division in proportion to the ownership shares, and division without loss of value. A garden plot and a building plot with a villa, for example, are not comparable parts. Proportionate division requires as many physical parts as there are co-owners. Their relative values must approximately reflect the ownership shares; minor differences can be equalised in money.

The house must also be divisible without a substantial loss of value. Such loss exists where the whole house is objectively worth significantly more than the resulting parts, or the division would itself cause high costs and consequential expenses. Courts have regarded a 5.28% reduction as insignificant, but, for example, a 15% reduction as disproportionate.

If sufficient units suitable for condominium ownership exist or can be created without disproportionate expense, condominium ownership may also be established. In all other cases, partition by sale through a judicial auction remains available.

6) Can an apartment that we jointly own be divided?

Partition means dissolving the ownership community. Physical division into two comparable units is only feasible if the apartment can actually be split into two such residential units. Apartments are therefore generally auctioned and the proceeds distributed.

7) What are the advantages of establishing condominium ownership?

It creates independent residential units that can readily be sold. Ordinary co-ownership shares may be legally transferable, but in practice are often almost unsaleable.

For the unit-value assessment (Parifizierung), a chartered technical expert prepares a report on the relative utility value of each unit. This reflects its usable floor area and all factors that increase or reduce its value, expressed as additions to or deductions from the floor area, such as orientation within the building or floor level.

The costs include the expert report, the condominium agreement and the application for land register entry.

8) What does a partition action cost?

The successful party is entitled to reimbursement of litigation costs by the opponent. The property is generally valued using its statutory property value (Grundstückswert). A lower valuation of the claim is possible, but if the opponent challenges it, the court may increase the amount in dispute to that property value.

An example from my practice: Former partners each owned half of a detached house in Vienna. Following separation, the man sought an auction and brought a partition action against the woman.

The claim was valued at EUR 17,000, which generally formed the basis for all procedural costs. Several written submissions were necessary and there were three hearings over five months. The woman initially sought to prevent a sale, arguing that the house could be physically divided into two comparable residential units. Alternatively, she requested condominium ownership.

Extensive settlement discussions at each hearing initially failed. An expert was then appointed to assess whether the house could be divided into two comparable residential units.

The former partners eventually settled: instead of a court auction, they agreed to sell through an estate agent, each bearing their own litigation costs. The house was subsequently sold at a profit.

The defendant's total costs were EUR 5,793.46 including VAT. The claimant additionally had to pay court fees of EUR 707. Costs in other cases may be lower or higher depending on the assessment basis and work involved. I will gladly estimate the expected costs in your situation. If you win, you are entitled to recover costs from the opponent.

9) Must an expert be appointed?

For partition of a house, the judge will normally appoint an expert, as it is often impossible without expert evidence to decide whether the case-law criteria are met: comparable parts, proportionate division and no substantial loss of value. The expert also determines the appraised value used as the minimum auction bid.

The unsuccessful party ultimately bears the expert's costs.

Free initial assessment — call now

If you have questions or need legal assistance with the partition of a house, land or an apartment, call for a free initial assessment or email office@maydell-law.at.

Mag. Patrick Maydell, LL.M.
Attorney at Law
Neustiftgasse 17/1/9
1070 Vienna
Telephone: +43 1 295 4251
office@maydell-law.at

The Austrian Supreme Court ruled in case 6 Ob 240/19s that a car buyer is entitled to money back if the repaired car is worth less than an equivalent defect-free vehicle. This also applies to used cars and concerns the vehicle's commercial diminution in value.

Mag. Patrick Maydell, LL.M., vehicle lawyer and trained motor mechanic, explains the main points.

1) Buyer discovers a leaking windscreen in a three-year-old car

The buyer purchased a three-year-old car from a dealer for EUR 33,500. During the test drive, he heard sloshing but assumed it was diesel in the tank. In fact, water had collected inside because the windscreen leaked. A small gap had remained in the seal between the glass and body when installed at the factory: a manufacturing defect. The water caused an oxidation layer on some electronic components. The buyer took the car to the dealer's specialist workshop for repair under the guarantee.

2) Even a used car must keep water out

The contract described the mechanical condition as class 2, good, with minor wear, no repairs needed, and minor adjustment or inspection required. Electrical and electronic equipment was also class 2, good, with the propulsion battery within its guarantee period and convenience electronics functional.

The Supreme Court held that a vehicle must have the characteristics ordinarily expected in trade, including roadworthiness and operational safety. This includes keeping moisture out, even for a used car.

3) After repair, the buyer seeks a refund

The buyer sued to return the car and recover the price through rescission (Wandlung). He argued that the water damage had not been properly repaired because wiring harnesses had merely been dried rather than cleaned, checked and replaced. He said the workshop had warned that the oxidation would cause future problems, that repairing the electronic defects was barely economical, and that the car was unsafe. He therefore claimed an irremediable defect and unsuccessful repair entitled him to rescission.

The dealer disputed this, saying it had properly repaired the car by replacing the windscreen and drying the vehicle.

Free initial assessment — call now

Call +43 1 2954251 or email office@maydell-law.at.

4) Supreme Court: the car was defective

The Court found that the vehicle was defective at delivery because the windscreen was not sealed to the body, causing water ingress and starting oxidation. A progressive oxidation process is a defect even before it reaches a stage capable of causing component failures.

The process was at least latent when risk passed to the buyer, so the buyer was entitled to repair.

5) The remaining oxidation was a minor defect: no right to return the car

The repair sealed the windscreen, dried the car and stopped the oxidation process. The court found that all components worked and no further oxidation was expected.

An oxidation layer on individual electronic components that neither impairs function nor continues to spread is a minor defect. The limited seriousness of these effects, without loss of function, had to be weighed against the impact of cancellation on the dealer. Rescission was therefore unavailable on this ground.

6) But the repair reduced the car's value, entitling the buyer to a partial refund

Although the repair was proper and stopped water ingress and functional problems, the car was worth less afterwards. This commercial diminution in value arose because it now had a value-reducing repair history that the parties had not agreed to.

In such circumstances, a buyer may be entitled to rescission or a price reduction, depending on whether the defect is serious or minor. Here, the loss in value was not sufficiently high relative to the purchase price to make it more than minor. Assessed in the context of this transaction, the remaining defect in the form of lost value was minor.

The buyer therefore could not return the car for a full refund, but could recover part of the price through a price reduction.

7) What the decision means

If a repaired vehicle is worth less than the equivalent vehicle without defects, the buyer may be entitled either to rescission, returning the vehicle for a full refund, or a price reduction. The extent of the loss in value is decisive. This applies to used vehicles too.

Mag. Maydell will discuss your legal options in a personal consultation. He works with vehicle experts to provide a quick, cost-effective assessment of the amount you may recover.

8) Problems with your vehicle?

Whether a seller concealed defects, you are a seller facing a buyer's complaints, or a repair has gone wrong, contact Mag. Patrick Maydell for a free initial assessment at +43 1 2954251 or office@maydell-law.at.

He specialises in vehicle law in Vienna and the surrounding area and is also a trained motor mechanic. His legal and technical knowledge assists particularly where:

• a purchased vehicle has technical defects concealed by the seller;
• a seller faces allegations of defects from the buyer;
• a workshop refuses repairs under a guarantee or statutory warranty;
• you were injured in a road accident and seek damages and compensation for pain and suffering;
• an insurer refuses to pay after an accident;
• you have problems with a leased vehicle or leasing company;
• other vehicle-related disputes arise.

Free initial assessment — call now

Call +43 1 2954251 or email office@maydell-law.at.

Mag. Patrick Maydell, LL.M.
Vehicle lawyer
Neustiftgasse 17/1/9
1070 Vienna
Telephone: +43 1 2954251
office@maydell-law.at

Image source: Quality Repair