Federal Court of Justice (BGH), Judgment of 23 January 2026 – V ZR 91/25
Summary
- A power of attorney or obligation to cooperate, granted to the developer in a standard-form developer agreement and requiring the purchaser to consent to a subsequent amendment of the declaration of division, is invalid under Section 308 No. 4 of the German Civil Code (BGB) if the clause does not expressly specify the permissible grounds for such amendments.
- For the first time, the Federal Court of Justice (BGH) explicitly requires that the compelling reasons justifying an amendment be specified in detail within the clause itself. A mere negative definition (e.g., “anything that does not adversely affect the purchaser”) is not sufficient.
- If the clause is invalid, the developer cannot enforce the purchaser’s consent by way of Section 242 BGB (good faith). The law governing standard terms and conditions (AGB law) prohibits any severability-based reduction to maintain validity.
- Developers and their advisors should review and update their standard contract templates without delay.
What was the case about?
A developer had planned a larger condominium complex in Berlin and divided it into several sub-communities by way of a declaration of division. The defendants acquired a retail unit on the ground floor. In the notarized developer agreement, the developer— as is common practice in the industry—secured a comprehensive power of attorney to amend the declaration, as well as an obligation on the part of the purchasers to consent to such amendments.
Internally, the power of attorney was limited: the content and scope of the special property were not to be adversely affected from an economic perspective; traffic and common areas were not to be significantly reduced or relocated; and no additional costs were to be imposed on the purchaser.
At a later stage, the developer decided to increase the number of accommodation units in another sub-community from 38 to 58 and to amend the declaration of division accordingly. The purchasers revoked their power of attorney. The developer’s action seeking approval of the amendments was unsuccessful at all levels of jurisdiction.
What requirements does the BGH impose on the clause?
The BGH has now resolved the central legal issue at the highest judicial level: A standard-form power of attorney to amend, or an obligation to consent in a developer agreement, is only compatible with Section 308 No. 4 BGB if the clause itself makes it clear that an amendment may be required only where specifically defined, compelling reasons are present.
In doing so, the Fifth Civil Senate expressly extends the principles applicable since 2005 to construction performance and choice of materials (BGH, judgment of 23 June 2005 – VII ZR 200/04) to amendments of the declaration of division. The reasoning: in both cases, the equivalence interest of the contracting parties protected by Section 308 No. 4 BGB is affected.
Until now, parts of the legal literature and, in particular, the appellate court had taken the view that it was sufficient for a compelling reason to exist in fact; an explicit specification in the clause was considered unnecessary, even redundant. The BGH has rejected this view: the purchaser must be able to identify, at the time the contract is concluded, the conditions under which amendments may be imposed. Only in this way is the predictability of changes in performance required by law ensured.
Which reasons qualify as “compelling”?
The BGH—drawing on academic commentary—identifies several examples of valid grounds for amendments in a developer agreement:
- the necessity or expediency to comply with official requirements,
- the safeguarding of infrastructure or access,
- the rectification of planning defects,
- the implementation of special requests by other purchasers.
This list is not exhaustive. What is decisive is that the clause clearly specifies the relevant grounds and, in its requirements, demonstrably takes due account of the purchaser’s interests. If a compelling reason actually arises at a later stage and the amendment is reasonable for the purchaser, the developer may rely on the clause—otherwise not.
Since the BGH explicitly requires that the compelling reasons be stated, it is likely that, going forward, it will no longer be permissible to use wording such as “in particular” in order to extend the scope of the clause to additional, unwritten but comparable grounds.
Even the purchaser of a commercial unit is to be regarded as a consumer in cases of doubt
A second key statement of the judgment is of considerable practical importance: even a purchaser of a commercial unit who is described in the contract as an “entrepreneur within the meaning of the German VAT Act” is, as a matter of civil law, generally to be regarded as a consumer if the acquisition serves private asset management purposes—such as letting the unit.
In doing so, the BGH confirms the line taken by the XI Civil Senate and expressly abandons its earlier conflicting case law (judgment of 26 February 2016 – V ZR 208/14). The concept of an entrepreneur under VAT law (Section 2 UStG) must be interpreted autonomously and does not determine the classification under civil law pursuant to Sections 13 and 14 BGB. A commercial activity is only deemed to exist where the management of assets, in terms of its scope, complexity, and number of transactions, requires an organized business operation.
In practice, this means that developers cannot rely on purchasers of individual commercial or partial ownership units being treated as entrepreneurs. The strict standards of AGB law will generally apply in these cases as well.
No Recourse via Section 242 BGB
Finally, the second guiding principle of the judgment is noteworthy: if a standard-form obligation to cooperate is invalid under Section 308 No. 4 BGB, a duty of the purchaser to consent will generally not arise from Section 242 BGB (good faith).
The appellate court had still fundamentally recognized such a claim—albeit limited to amendments for which the developer could have validly reserved a power of attorney. The BGH considers this to be an impermissible severability-based reduction: a user of standard terms who drafts overly broad clauses must bear the full risk of their invalidity. Otherwise, the protective purpose of Sections 307 et seq. BGB would be undermined, as a developer could use excessively broad clauses without risk.
The consequence is strict but consistent: an invalid clause cannot be applied even within a “valid residual scope.” Anyone who uses a defective amendment power of attorney or consent obligation loses the entire mechanism—not just the problematic parts.
What does the decision mean in practice?
For developers, project developers, and their advisors, the judgment has immediate practical implications:
- Review contract templates. Existing developer agreements should be examined to ensure that amendment powers of attorney and obligations to cooperate explicitly specify the permissible grounds for amendments. General clauses without such specification will no longer withstand content control.
- Define compelling reasons precisely. The clause should clearly identify the relevant circumstances (e.g., compliance with official requirements, rectification of planning defects, special requests of other purchasers); generic references to “legitimate interests” are not sufficient.
- Assess consumer status realistically. Even in the sale of commercial units, purchasers will generally be considered consumers. As a result, the strict standards of AGB law apply in nearly all developer projects.
- Clearly limit the internal scope. In addition to specifying compelling reasons, the clause must adequately safeguard the purchaser’s interests—such as cost neutrality, intended use, and the essential characteristics of the special property.
- Make use of notarial structuring. Careful notarial drafting is a key risk factor in developer projects. Those who rely on outdated standard templates risk being unable to enforce amendments to the declaration of division at a later stage.
