Questions

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itself. According to § 929 sent. 1 BGB, ownership of movable property passes from the transferor to the transferee upon the conclusion of (1) the agreement that title should pass (hereinafter referred to as ‘the real agreement’, Einigung), and (2) the delivery of the movable.1 Although in practice the real agreement will usually coincide with the contract of sale (often the parties will be ignorant even of the need to conclude a second agreement), both agreements are regarded as strictly separate in law. Moreover, the validity of the real agreement is independent of the validity of the contract of sale or other obligation to transfer ownership.2 Finally, the passing of ownership does not depend on the payment of the purchase price, except when the contract of sale provides for retention of title.3

In the present case, ownership of the chairs and desks will have passed to B upon delivery. It can be assumed that at the time of delivery, the parties will have agreed, at least implicitly, that ownership should pass.

German law does not have a general theory on the effects of insolvency on property law, such as, for example, the Belgian concept of samenloop/concours.4 All the property belonging to the debtor when insolvency proceedings are commenced simply comes under the administration of the insolvency administrator (see § 80 InsO5).6 Whilst the debtor does not cease to be owner of his assets, he does lose his entitlement to dispose of or otherwise administer them. ‘Property that belongs to the debtor’, in this context, means all legal rights to which the debtor is entitled, with the exception of strictly personal rights such as his name or a copyright. Such legal rights may be absolute (ownership of movables

1 See further Van Vliet, Transfer of Movables 31 f., 34 ff.

2This is the famous ‘principle of abstraction’ (Abstraktionsprinzip). For a more detailed explanation see Van Vliet, Transfer of Movables 32 ff.; for its development see also Zimmermann, The Law of Obligations 867, n. 200, and Wacke, ZEuP 2000, 254 (255 ff.). For a practical application see infra (b) and German report, case 2.

3 See infra, German report, case 3.

4 For a discussion of this concept, see infra, Belgian report, case 1(a).

5The new Insolvency Code (Insolvenzordnung of 5 Oct. 1994, Bundesgesetzblatt I 2866, hereinafter cited as InsO) came into force in its entirety on 1 Jan. 1999. Texts and materials are reproduced together with an introduction in: Balz/Landfermann, Die neuen Insolvenzgesetze. See also the German--English edition by Stewart, Insolvency Code, Act Introducing the Insolvency Code. For an overview of the Insolvency Code in English see Paulus, Texas International Law Journal 33 (1998) 141.

6Provided that the court administering the insolvency proceedings has not approved so-called ‘self-administration’ (Eigenverwaltung) by the debtor. This procedure was first introduced by §§ 270 ff. InsO.

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(c) Under the new Insolvency Code (InsO), there is no longer a special statutory provision governing this situation.11 The solution therefore depends on whether ownership of the movables had already passed from A to B when the furniture was in the hands of the carrier. The real agreement may be concluded anticipatorily; for example, together with the contract of sale. It will remain valid until the moment of delivery, provided the parties still want to be bound by it. The crucial point is the time of delivery of the furniture. Usually, delivery takes place when the buyer or his employees (see § 855 BGB12) take direct possession.13 In the present case this would be the moment at which the goods arrive at B’s premises. However, actual delivery can be replaced by an assignment of the claim for recovery of the property to which the transfer relates (§ 931 BGB).14 This would require A to assign to B his contractual claim for recovery of the furniture against the carrier. Without such an assignment, the goods remain the property of A whilst in transit.15 A’s rights may however be subject to the carrier’s statutory preference (under § 441 HGB). This preference secures the carrier against non-payment of the freight and subsists for as long as the goods are in the possession of the carrier. It ends three days after delivery unless the carrier has, during this time, brought an action in court to enforce his rights (§ 441 s. 3 HGB).

a u s t r i a

(a) A does not have any real rights in respect of the furniture. B became the owner of the furniture when it was handed over to him.

This is due to the rules of Austrian law dealing with the transfer of property (and the creation of any right ad rem16), which require a title

11Under the old Insolvency Code (Konkursordnung), § 44 KO, the seller had a right to stop goods in transit, when the goods had not been fully paid for, provided that insolvency proceedings were commenced in respect of the buyer before the goods had reached him. No provision to this effect is to be found in the new Code. Obviously, it proved to be irrelevant in practice.

12§ 855 BGB provides that if someone exercises physical power over a thing on behalf of someone else within the latter’s household or business, only the latter person has possession. The former person is called the Besitzdiener. This provision must be strictly distinguished from that of an agency. It is generally agreed that the transfer of possession is not a legal act, but a factual one. Therefore, representation by an agent is not possible. See further Van Vliet, Transfer of Movables 49 f.

15Although the contractual risk may nevertheless have passed to B according to § 447 BGB.

16Austrian legal scientific writing and the practice of the courts distinguish between absolute and relative rights. Absolute rights must be respected by everybody, whereas

and the observance of a modus (titulus and modus cf. § 380 ABGB). The title for a transfer of property can be a contract, a last will, and sometimes even a legal provision (cf. § 423 ABGB).

The modus consists of two parts; a real agreement (Einigung) and, generally, the delivery of the goods. The real agreement is a creation of legal scientific writing which was influenced by German doctrine after the enactment of the German BGB; the ABGB of 1811 does not know it. In the real agreement the parties declare that ownership of the object shall pass to the buyer.

There are two theories about when the real agreement is concluded. The first (majority) theory17 holds that it is part of the contract, for example the contract of sale. According to the second theory,18 however, it is concluded at the moment when the goods are handed over to the buyer. Originally the OGH followed the second opinion;19 but since the decision ÖBA 1987, 51 the court has followed the first opinion.20

Nevertheless, the transfer of ownership does not take place upon entering into a contract but only when the object is handed over to the buyer (§ 426 ABGB). When the object cannot physically be handed over, the transfer may take place symbolically (§ 427 ABGB). It is also possible to make use of a constitutum possessorium (constructive possession, Besitzkonstitut), under which the former owner agrees to hold the goods for the transferee (§ 428 ABGB).21 If the purchaser is already in possession of the object bought, the transfer of property is done by way of a traditio brevi manu (§ 428 ABGB). If the object is held by a third party, this person can be instructed to hold it on behalf of the transferee (instruction

relative rights impose obligations on certain persons only. Rights arising from a contract, for example, are relative rights, as they can be enforced only against the other party. A subclass of absolute rights are ‘dingliche Rechte’, rights ad rem. These are rights to property, which must be respected by everybody. Absolute rights which are not rights ad rem are the rights relating to the person, the right to live, etc. The ABGB operates with a slightly different conceptual apparatus. It does not recognise absolute rights, but only rights ad rem (cf. § 307 ABGB). It furthermore classifies certain rights as rights ad rem, which -- according to modern doctrine -- are not rights ad rem, such as possessio and the right of inheritance.

17Spielbüchler, Der Dritte im Schuldverhältnis 101 ff.; Klang/Bydlinski IV/2 370 ff.

18Koziol/Welser, Grundriß des bürgerlichen Rechts II 75; Bollenberger, Irrtum über die Zahlungsunfähigkeit 90 ff.

19EvBl 1955/200, HS 7345 and 10.746, JBl 1984, 671 = RdW 1984, 310.

20See also RdW 1987, 157 and 11 Feb. 1997, 5 Ob 18/97a ecolex 1997, 424 = NZ 1998, 136.

21It is not necessary for the seller and the buyer to make a contract of deposit, thereby creating a new causa; cf. OGH 10 June 1981, 3 Ob 52/81, JBl 1982, 311. In general it is a matter of interpretation whether the parties genuinely agreed to a constitutum possessorium; the parties must articulate their will in order to transfer ownership of the goods sold.