Cancellation of contract due to force majeure: example fitness subscription
Due to the closure order in COVID-19 Regulation 2, many of those affected can no longer fulfil their contracts. What is the legal situation with contracts that extend over a longer period of time, e.g. a fitness subscription?
"To determine the legal consequences, the individual contractual relationship must first be analyzed - the consequences differ depending on the type of transaction."
Continuing obligations
In addition to contracts with a one-time exchange of services, there are also contracts in which a service is owed over a longer period of time. Examples of this are the fitness subscription or the tenancy. These are referred to as continuing obligations.
Continuing obligations have a right of termination by law. If there are important reasons (e.g. impediment to the purpose of the contract), extraordinary termination is possible. What constitutes an important reason is decided by a court at its discretion. In addition, important reasons can also be defined in individual contracts. The fitness centre, which can no longer provide the service to its subscribers due to the closure of the business ordered by the authorities, can also no longer fulfil the purpose of the contract. Therefore, an important reason would have to be examined here.
Due to the official ban, the fitness centre can no longer fulfil the service, it becomes impossible. In order to determine the legal consequences for the impossibility of performance of the contract, the time of performance owed must first be determined according to the individual contractual relationship. In the aforementioned example of the fitness subscription, for example, the fitness centre will be obliged to offer the services to the subscriber continuously during opening hours. If this is not possible, the fitness centre will in principle be in default with each day on which it cannot provide the service as contractually agreed. Since the provision of services at any time is probably not part of the absolutely necessary content of the contract for a fitness subscription, temporary impossibility is to be assumed. Therefore, the default rules in the sense of Art. 102 ff. OR are to be applied. The subscriber will have the right to choose between adherence to the contract and compensation for the damage caused by the delay, waiver of performance and damages for non-performance or withdrawal from the contract.
The difference with a continuing obligation is that withdrawal with effect from the beginning of the contractual relationship is no longer possible, as certain services have already been provided. For example, the subscriber has already received services in the fitness centre in January and February. Moreover, the subscription was paid in advance for the whole year. In this case, the rescission is limited to the rescission of the contractual relationship with effect for the future. In this case, each party to the contract is credited for what has already been paid and the imbalance is balanced out, e.g. with a refund to the subscriber. A practicable solution would also be to credit the "missed" service to the duration of the subscription contract by extending the subscription for the duration of the operating ban. The best way to do this is to contact the fitness centre.
This article was written by Rebecca Isenegger, lawyer.
For further information on contract law, please contact Arife Asipi directly.