Support and GTC Clauses as Pitfalls in Contracts for Work and Services

If the contract for work and services is followed by an obligation to provide support, this can be expensive and disadvantageous for the seller. It is important to know whether further support has already been agreed in the contract for work and services, because often an obligation is already entered into in the contract for work and services through a clause on support, although this is actually an independent service contract.

Such support in the form of advanced support is particularly important for software, but also in other areas. Part of the support can be, for example, the further development or later adaptation of the product. If support is provided over a longer period of time, it may be necessary to be able to renegotiate the price in order to avoid unforeseeable costs on the contractor’s side.

 

Example:

In the contract for work and services, a provision for support over 2 years at a fixed price is agreed. However, due to new collective agreements, the wage costs for employees increase by 10%. Since there is no possibility of renegotiation, the support must be provided at the prices agreed 2 years previously.

As you can see, there is a price trap here, which can have a negative effect, but not inevitably. In any case, however, the possibility of price renegotiation should be given. Another clause that we would like to look at in this blog article is the inclusion of the GTC.

Whose GTCs should apply or should GTCs be excluded from the entire contract? Often this question is not asked at all, but is assumed in the respective contract template. Clauses such as “Our respective GTC in the current version (available at www.companyxyz.de) apply in addition” are not uncommon. Such a clause entails great risks for the other party, because the GTCs are usually formulated in a very one-sided advantageous way. As a rule, GTCs are formulated, within the limits of what is legally possible, in such a way that liability is excluded as far as possible. In addition, an entire, possibly multi-page contract also becomes part of the contract due to the fact that the GTCs are also valid. Such all-in clauses should be avoided.

 

Example:

A and B GmbH conclude a contract which contains the clause “the GTC of B GmbH also apply”. No provision on the payment term was agreed, but B GmbH grants itself a payment term of 45 days in the GTC. Thus, this payment term applies without any special mention in the contract.

In addition, the wording “the respective current GTC” offers the possibility of adapting the GTC and agreeing on other payment terms, to remain with the above example. Therefore, the general terms and conditions of the other party should never become part of the contract!

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