The Federal Supreme Court (BGH) has confirmed its previous case law according to which consumer loan law applies accordingly to the accession of a debt with regard to a loan obligation (judgement of 21 September 2021 – XI ZR 650/20). Although the accession of a debt is not a loan because the acceding party does not obtain a loan itself, it is to be equated with a consumer loan according to the established case law of the Federal Supreme Court.
Joint liability through assumption of debt
Accession to the debt is a frequently chosen form of joint liability, especially for loan liabilities, but it is associated with numerous disadvantages for the acceding party. Not only does he have to assume responsibility for the debtor’s liabilities, he also has no possibility of influencing the debtor’s repayment. In many respects, the acceding party is therefore on a par with the guarantor, who also enters into a highly disadvantageous legal position without being able to exert any significant influence.
In a case in which the husband had declared an accession of debt with regard to the current account of his wife’s company, the Federal Supreme Court affirmed the applicability of consumer loan law to the accession of debt, since the accessor was similarly in need of protection as the borrower. The husband was classified as a consumer despite the entrepreneurial nature of the loan because he had not become active in an entrepreneurial capacity by joining the debt and in this respect it was only the time of the declaration of joint liability that mattered.
Consumers as guarantors
The husband’s status as a consumer opened up the question of whether he had the right of revocation applicable to consumer loans, by exercising which he could have released himself from the liability entered into. However, the Federal Supreme Court denied this in the result due to Sec. 504 para. 2 BGB, according to which there is no right of revocation for consumer loans if this is a current account. The case was then referred back to the lower court for a decision. The BGH’s constant case law on consumer collateral makes it clear that it also makes sense in the case of business loans to examine the application of consumer protection regulations. At least for consumers who act as guarantors, there may be opportunities here to free themselves from an obligation to stand in for loan liabilities. Horwath & Meier will be happy to assist you in assessing the prospects of success of your case.