Payment of final installment and acceptance

nowhere is there any mention of §632.

It doesn’t have to be.
What is already stated in the law does not need to be included in the contract.
What matters is that the requirements from it are implemented correctly.
If you haven’t done so yet: you should read § 632a of the Construction Code.

The only thing that is stated in the contract with 5% is the completion bond, which is supposed to be handed over to me when construction starts.
Nowhere is there any mention of §632.

One cannot assess "your case" – which is always only partially disclosed – without the documents.
The 3.5% security bond from the beginning was mentioned in the contract. Before your lawyer, you also SHOULD have read the contract before signing... one would assume...

Your "completion bond" is – presumably – the contract performance security required by § 632a of the Construction Code for your benefit.
That’s already good!
BUT: The point in time "at the start of construction" would be too late; the law says: at the first installment payment (meaning simultaneously).
Because: The bond is supposed to protect you against the insolvency of the contractor before the corresponding stage of construction is reached. You cannot/should not only demand the bond at the start of construction.

Back to the infamous 3.5% security bond (in favor of the contractor) from the beginning:
1. Who pays the costs for it? Bonds cost 1-2% of the bond amount...
2. What does your bank say about it?
3. Its effectiveness is questionable, see above. For me, it also does not make much sense, since it (as a performance bond = here: payment) factually only secures the insolvency risk of you for the contractor. But the contractor does not get the money that easily, see above #11, if you withhold money at the end due to defects. Whether it may possibly be used as a de facto pressure tool in case of dispute... we don’t know yet.
4. It is in the contract – which is annoying in the first place. But nothing else has happened yet! Take the answer from 2. to your / another lawyer. Then decide how you approach the contractor... Maybe the contractor can build great – only the contracts don’t work out so well yet...
5. Until then, educate yourself a bit on bonds, contracts for work & services, etc. on the internet... But be careful of dangerous half-knowledge.

Hello construction expert Hello SirSydom. The only thing stated with 5% in the contract is the completion guarantee that is supposed to be handed over to me at the start of construction. Nowhere is §632 mentioned.

Google 632a and brauchtrechtsblog. You’ll find pretty good information there.

As the previous poster already said, the § doesn’t necessarily have to be mentioned – what’s important is that the guarantee meets the requirements of the §. Whether that is the case can only be said once you tell us when your first payment is due?

Because the guarantee must be handed over BEFORE the first payment. For example, I paid my first installment "upon completion of the foundation slab," if that’s the case with you, for example, everything would be fine!

Try talking to your bank to see if they even issue such a requested guarantee (DEVK, for example, does not do it; with the Sparkasse it would have worked, even free of charge).

Hello.
The payment schedule is as follows:
For a house with a basement, the installments become due as follows:
• 5.0 % upon handing over the building application/building notification;
at the latest with the granting of the building permit
• 10.0 % upon completion of the foundation slab
• 10.0 % upon completion of the basement ceiling
• 10.0 % upon completion of the ground floor ceiling
• 10.0 % upon completion of the load-bearing walls
• 20.0 % upon completion of the roof truss, roof covering and roofing work (13%) and installation
of the windows (7%)
• 9.0 % upon completion of the rough electrical installation (4%) and interior plaster (5%)
• 5.5 % upon completion of the rough heating and sanitary installation (3%) and screed (2.5%)
• 5.0 % upon delivery and installation of the heating system
• 7.0 % upon completion of the exterior plaster or facing brickwork
• 5.0 % upon completion of tile work (2.5%) and installation of sanitary fixtures (2.5%)
• 3.5 % upon completion ready for acceptance. Basically, a "putting into use" is only
possible after full payment.

for your security:
Performance bond:
A performance bond of 5 % of the construction sum or the fixed house purchase price by a German insurance company is included. The performance bond is given to the builder directly before construction begins and must be returned upon handover/acceptance against key handover.

The building application has already been submitted for about 6 weeks. The first invoice has already arrived.
Since I succeeded in having the addition "upon granting of the building permit" included for the first payment, I have not paid it yet.

Is the performance bond the same as §632? If yes, I would have to withhold the payment until I receive this security... right?
I have not yet spoken to the bank about this.

The construction company wrote:
If a bond is not possible:
1. Change the wording of the last installment: instead of payment after acceptance – payment after completion ready for acceptance, but before takeover by the builder.
2. Advance payment of the amount into our savings account, similar to a security deposit.

The accounting department that wrote these two sentences apparently overlooked that the first sentence is already stated that way in the contract under: last installment. (This was changed by the seller from "upon acceptance" to: "upon completion ready for acceptance. Basically, a "putting into use" is only
possible after full payment." - ).

I would gladly post everything here (the contract without names) but that is certainly not allowed

As long as the contract is anonymized - I see no reason in the forum rules that forbid this.

Basically, such a guarantee is no drama towards the GÜ.
You can still just talk to the company. Tell them that your lawyer said this clause is inadmissible and therefore void - and see what happens. If they insist, you have to consider whether to find another company, provide the guarantee, or change the due date of the last installment.

Personally, if I wanted to build with the company AND they are not willing to waive the guarantee, I would choose option 1) (or do they want both 1 AND 2??).
And talk to your bank about whether and, if so, how expensive it is to get such a guarantee and under what conditions they would pay out.
A prepayment into a savings account is a joke. Don’t do that.

One more note about your payment plan:
Compared to mine, it is quite front-loaded.
Until the completion of the shell with windows, I only pay 49%, you already 65%.
But whether it’s still okay, I cannot judge.

• 3.5% upon acceptance-ready completion. In principle, "putting into use" is only possible after full payment.

Haha. Don’t forget, it’s your land. And with it, YOUR house. You alone decide who stays on this property and who lives there. In other words, if you want to move into your house without having paid the last installment - he can’t do anything about it.

My impression of the company is that they want to reduce your possibilities to enforce defect corrections by withholding payment to zero. I don’t find that very reputable..

Honestly - I think your lawyer was not worth the money, and even if he was free, he was not worth the time.. Is he really a construction law lawyer??

Thank you SirSydom. I see it the same way. My lawyer was referred to me by the Bauherren-Schutzbund. And his area of expertise is construction law. Meanwhile, he has also written something about it, because I did not let it go: Dear Mr....., the right from § 632a results from the law and does not have to be stated in the contract, just as your rights in case of defects do not, these also result from the law. Therefore, I am not quite clear what you mean by saying you "would not have signed the contract with this knowledge"??? These are regulations in your favor! Regardless of what is stated in a contract for work. Again: With a contract for work, you cannot circumvent or effectively exclude statutory regulations vis-à-vis an end consumer. However, it is not criminal, though unlawful, if a contractor demands an additional guarantee. And as I understand you, this happened only after the contract was concluded. You do not have to agree to that. I therefore cannot follow your argumentation. I have examined your contract in the light of the law. A comprehensive introduction to contract law is not intended here. The allegedly "unpleasant and awkward situation" is also not clear to me. You only pay for the performance that has actually been rendered, if it is free of defects. Where is the problem in that? I replied as follows: Good day Mr.... The requested guarantee was already in the contract. (§3 Clause 1) The form to fill out or forward to the bank came only weeks later. What do I do if the construction company does not comply with §632a but demands the first installment as stated in §2 of the contract? What do I do if the construction company insists on the guarantee because I signed it? The guarantee not only costs money (guarantee commission) but most banks refuse to sign such a guarantee. As I said, I am a layman and did not know what the guarantee was about. I thought more of a financing confirmation. The unpleasant and awkward situation arises from the above-mentioned situations with the construction company. Best regards Then the lawyer’s answer again: Dear Mr....., you do not submit the unlimited guarantee according to § 3 Clause 1 to the contractor nor conclude it. A financing confirmation is sufficient. Your bank has assessed the legal situation completely correctly. Instead, you withhold from the first installment, if this is not sufficient, also from the next one, a total amount of 5% of the construction sum. It does not matter whether the general contractor agrees to this or not. The law gives you this right and no one can refuse it. If the contractor then does not want to perform, he is in default and liable for damages. It may be that you do not arouse enthusiasm with the general contractor by doing so, but ultimately it is about your rights. Best regards Even on Sundays the lawyer takes time to answer emails here.... I had to get everything out of him... your information was more accurate and detailed than that of my lawyer..... The contract review took place by email and the result was about half the text of this last post.....

Well, look at that, the lawyer has put in some effort after all. What did you pay him for this consultation? Never mind, if he offers it, he should do it properly.

The best thing is, you now have it in black and white from your lawyer what you are supposed to do. With instructions! In other words, if this turns out to be bad advice (but I agree with your lawyer, i.e. I see none!) he is also liable for it.

Now it is your task to speak calmly and sensibly but firmly with your contractor. For that, I would recommend a personal conversation. Take your wife with you if you are married. Print out the lawyer’s emails, and preferably also the §. You can also take the blog entry I already referred to.

If he refuses, try to find out what it is really about. I cannot imagine that it is actually about non-payment by the client.. Maybe a way can be found. Making a few small concessions that don’t hurt might help.

Good luck.