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Technology- & IT-Law

Obligations for the transfer of standard software in Germany

The Munich Higher Regional Court (20 U 3236/22 e) had the opportunity to comment on the obligations of a provider of standard software on the occasion of the termination without notice of a software and license subscription.

In doing so, the OLG emphasizes that a temporary transfer of standard software against payment is to be assessed as a rental agreement and in this respect refers to the case law of the BGH. The case concerned software for managing rentals in the hotel and restaurant industry, which had glaring defects that also justified termination:

Due to the long-term rentals, which are in the foreground at the defendant, it is a significant defect of the offered software that no flat rate for monthly rentals (regardless of the length of the concrete month) can be set in the provided version. The defendant had already complained about this point shortly after the installation of the software and the opening of the Hotel… reprimanded … Whether … a corresponding adjustment of the software would be possible, can remain open, since on the complaint of the deplored one such adjustment did not take place …

According to the expert opinion, other significant deficiencies include the fact that no tax-recognized invoice (with VAT) can be created before a guest checks in, that a calendar overview of the bookings is only possible on a weekly basis, so that a correspondingly large number of screen pages have to be called up one after the other for bookings that typically last for months, and that a daily closing is mandatory, even if there were no daily bookings.

From the court’s point of view, it could be left open whether the hotel operator, as the client, had pointed out prior to the conclusion of the contract that it intended to operate a boarding house where the software was expected to provide a monthly fixed price, fiscally correct advance invoices and monthly calendar overviews. Here, the software provider wanted to defend itself by saying that it was not aware of these requirements for the use of the software.

But: If such information about the expectations had not been provided, this would have been attributable to the software manufacturer, as the OLG states. Because as an expert, it would have been incumbent upon her, in view of the hotel operator’s inexperience with a reservation program, which she herself recognized, to clarify the nature of the defendant’s business and what requirements it places on a reservation software to be used for this purpose. This is not new in this respect, the OLG Munich quotes here the OLG Cologne with a decision from the 90s.But: If such information about the expectations had not been provided, this would have been attributable to the software manufacturer, as the OLG states. Because as an expert, it would have been incumbent upon her, in view of the hotel operator’s inexperience with a reservation program, which she herself recognized, to clarify the nature of the defendant’s business and what requirements it places on a reservation software to be used for this purpose. This is not new in this respect, the OLG Munich quotes here the OLG Cologne with a decision from the 90s.

Conclusion: Even in times of agile software development and new models of software distribution, developers or distributors of software products should keep in mind that there may be considerable obligations to provide advice and clarification. If work is not done carefully here – and this also includes the documentation of the advice – this can end up being expensive.

German Lawyer at Law Firm Ferner Alsdorf
I am a specialist lawyer for criminal law + specialist lawyer for IT law and dedicate myself professionally entirely to criminal defence and IT law, especially software law. Before becoming a lawyer, I was a software developer. I am an author in a renowned commentary on the German Code of Criminal Procedure (StPO) as well as in professional journals.

Our law firm specialises in criminal defence, white-collar crime and IT law / technology law. Note our activity in digital evidence in IT security and software law.
German Lawyer Jens Ferner (Criminal Defense & IT-Law)