This approach has now been confirmed by the Supreme Court in its recent decision File No. 33 Cdo 416/2020, dated 29 October 2020 (the “Decision”).

What does the law say?

In B2C relations, a consumer can claim defects of consumer goods within 24 months from their receipt (Section 2165(1) Civil Code). The seller may also provide a commercial warranty (guarantee).

If a defect occurs, consumers have the standard set of rights arising from defective performance, i.e. repair, discount from the purchase price, replacement of the product/its part if suitable, and withdrawal from contract (Section 2169 Civil Code).

This also applies to contracts for work as rights from defective performance stipulated for purchase contracts are applied accordingly to a contract for work (Section 2615(2) Civil Code).

The “old” Civil Code (Act No. 40/1964 Coll.) that was in force until 31 December 2013 stipulated that if a product is replaced under the warranty, a new warranty period starts to run from receipt of the new product. The same applied if a component was replaced for which a warranty was granted. The “new” Civil Code (Act No. 89/2012 Coll.) in force since 1 January 2014 does not contain such provision, and until the Decision, legal doctrine interpreted this to mean that a new warranty period does not start in case of a warranty replacement.

What were the courts’ views?

In the case concerning the Decision, the consumer ordered a swimming pool with LED lighting as its component from the contractor. After eight months, the consumer claimed defects of the LED lighting, and the contractor offered a replacement of the LED lighting by a different product because the original type was no longer available on the market. After almost two years from the replacement, and three years from the original purchase, the consumer claimed another defect of the LED lighting, which was rejected by the contractor as exercised after the warranty period had expired. The consumer thus brought his claim to the court amounting to the discount in the value of the defective LED lighting.

The first instance court approved the consumer’s claim arguing that a new warranty period started as of the day of the delivery of the new LED lighting and thus the consumer has exercised his rights timely.

The appellate court dismissed the consumer’s claim and reminded that the “new” Civil Code has not assumed the provision from the “old” Civil Code stipulating a new warranty period in case of a warranty replacement. The court stated that the 24-month warranty period relates solely to the product itself (the subject of the contract for work), i.e. to the work as such, and a potential defect in any of its components does not constitute the running of a new warranty period for the replaced component, unless the contracting parties agree otherwise. The court concluded that the defect of the replaced LED lightening was claimed after the expiry of the warranty period.

The consumer brought the case to the Supreme Court, claiming that the question at hand has not yet been resolved by the Supreme Court and that the appellate court has assessed the matter incorrectly.

The Supreme Court held in the Decision that the appellate court’s assessment was correct and repeated that since 1 January 2014, the rule of a new warranty period in case of a warranty replacement is not applicable. This is because the statutory duties arising from defective performance are only linked to the seller’s obligation to ensure that the consumer can use a defect-free product for a certain period of 24 months, and are not linked to the product itself. Additionally, the Supreme Court said that the same applies in this case of replacement by a different product of the same type. The Supreme Court stated that if lawmakers had wanted to introduce a start of the new warranty period in case of a warranty replacement, they would have expressly stipulated it in the “new” Civil Code as was the case until 31 December 2013.

Well, let’s not celebrate just yet

According to publicly available information, a constitutional complaint was filed against the Decision at the beginning of 2021. It may take several months, even years, until the Constitutional Court decides on the merits of the case. It is therefore yet to be seen if the Constitutional Court approves the interpretation provided by the higher courts.

Please also note that decisions of Czech courts are not formally binding as precedents in other cases. Nevertheless, a person seeking legal protection can reasonably expect that his/her case will be decided in the same way as any other case which has already been decided, and which is essentially identical to his/her case. If a case is decided in another way, the person has the right to a convincing explanation of the reason for such derogation.

Authors

Vojtech Chloupek

Partner  |  Czech Republic

 +420 226 030 518

 vojtech.chloupek@twobirds.com

 vCard

Gabriela Malá

Associate  |  Czech Republic

 +420 226 030 500

 gabriela.mala@twobirds.com

 vCard