passing of risk

Which translation, when

Why

Passing of risk translates as Gefahrübergang, and the German provisions place the moment with more precision than the English phrase implies. The basic rule of § 446 BGB attaches it to handover: once the sold thing is handed over, the risk of accidental destruction and accidental deterioration passes to the buyer, meaning he owes the price even where the goods perish afterwards without fault on either side; the same provision equates default of acceptance with handover, so a buyer who will not take delivery cannot push the risk back on the seller. The dispatch sale is the commercially important variation. Where the goods are sent, at the buyer’s request, to a place other than the place of performance, § 447 BGB moves the risk to the buyer as soon as the seller hands the goods to the carrier, forwarder or other person charged with the shipment, so transport losses fall on the buyer although delivery is still days away, a result that regularly surprises readers of an English contract where risk and delivery tend to travel together. Consumer sales are carved out: under § 475 Abs. 2 BGB the dispatch rule applies only in the narrow case where the consumer himself instructed a carrier the seller had not named, so in ordinary online retail the seller bears the transport risk. The second function of the term is easy to miss and matters for every defects clause: the passing of risk is the reference moment at which the goods must meet the requirements of § 434 BGB, so the same expression answers who bears an accidental loss and when the condition of the goods is judged, the defect standard itself belonging to the defect entry. Finally, the statutory moment is dispositive in commercial practice, and Incoterms or similar trade terms replace it by agreement, which is why a translated contract should never leave the two layers unreconciled.

Typical mistakes

• In a dispatch sale the risk passes on handing the goods to the carrier, § 447 BGB, not on delivery, so transport losses fall on the buyer earlier than an English contract suggests.
• The dispatch rule does not carry over into consumer sales on the same terms, § 475 Abs. 2 BGB, so applying it to online retail misplaces the transport risk.
• The passing of risk is also the moment at which the goods must be free of defects, § 434 BGB, so shifting it by agreement moves the defect assessment with it.

What matters

Checking delivery and risk clauses in a German-language sales contract: the text should use Gefahrübergang, state whether handover or dispatch governs, respect the consumer carve-out, and reconcile any Incoterm with the statutory moment.

Examples