The Munich Higher Regional Court has ruled that the wording “The standard conditions in the German grain trade and the buyer’s arbitration court apply” leads to an effective arbitration agreement and the dispute can only be settled before an arbitration court of a German grain or products exchange.
The contract also included the agreement “The standard conditions in the German grain trade as well as the buyer’s arbitration court apply”.
As a result, the seller did not deliver. The complaint was forwarded to the seller and he was asked to appoint an arbitrator and to comment on the arbitration complaint.
The seller was of the opinion that, despite the reference to the uniform conditions, there was no effective arbitration agreement. He had not taken note of this passage either and had not been aware of the uniform conditions, since he only ran a small agricultural farm.
Effective arbitration agreement according to uniform conditions
In principle, the seller had the option of having it determined whether an effective arbitration agreement had been concluded. This is also possible at any time before the state courts until the arbitral tribunal is constituted.
However, the court ultimately dismissed the action. The reference to the standard conditions in another contract was sufficient to justify an arbitration agreement. In transactions between business enterprises, the standard terms and conditions do not have to be sent again separately. Rather, it is reasonable to expect every company to inform itself. This also applies to small businesses, such as the seller in this case. If the contract refers to the standard terms and conditions, these shall apply in addition to the other contractual provisions.
Do you have questions about the standard conditions? Please feel free to contact us. We provide specialist advice in the field of agricultural and land trade and related contract law.