Course fees from a void coaching contract must be refunded: basic criteria of the Federal Court of Justice (BGH) on coaching as distance education

The Federal Court of Justice (BGH) declared a coaching contract void and established basic criteria for online coaching offerings in distance education.The legal question of the extent to which digital coaching and mentoring programmes are to be classified as distance education within the meaning of the Distance Education Protection Act (FernUSG) is of paramount importance for the providers of such courses. As distance education, such courses require approval from the State Central Office for Distance Education (ZFU). Without this approval, distance education contracts concluded with the providers of such courses are void. This eliminates the course provider's claim for payment arising from the coaching contract. Course fees already paid can be reclaimed by course participants.

State of the dispute prior to the decision of the Federal Court of Justice (BGH)

The classification of digital coaching and mentoring programmes is disputed in case law and legal literature. In particular, there was disagreement as to whether the FernUSG applies only to consumer contracts. Furthermore, the criteria for determining spatial separation were equally unclear, as was the question of how to treat coaching offerings that contain a mixture of online content and in-person events and/or direct online instruction, for example in the context of a video conference. The question of whether, in coaching and mentoring courses, the imparting of knowledge or individual and personal advice to the course participant is the predominant feature was also decided inconsistently. The Federal Court of Justice (BGH) has now provided greater clarity on this matter.

Facts of the coaching case decision

The subject matter of the proceedings before the Federal Court of Justice (BGH) was a legal dispute before the Regional Court (LG) and then the Higher Regional Court (OLG) Stuttgart regarding claims for payment arising from a coaching/mentoring contract. The provider, which described itself as an academy, offered a "9-month business mentoring programme ('Financial Fitness')". The participation in the course was intended to impart entrepreneurial skills to the participants. The provider advertised that the complete know-how of the two coaching entrepreneurs from their practical experience in business management and business development would be passed on to the course participants. The course consisted of fortnightly online meetings, homework, clarification of questions in the meetings, by email or in a Facebook group, as well as two online individual sessions with a personal coach to "resolve personal blockages". The online meetings were each recorded and subsequently made available to the participants. There was no approval under the Distance Education Protection Act (FernUSG) for the coaching/mentoring programme. A course participant who was dissatisfied with the course terminated the coaching contract, demanded a refund of the course fees already paid and sought a declaration that he did not have to make any further payments. The defendant provider filed a counterclaim and demanded payment of the remaining contractually agreed course fees. The Regional Court (LG) Stuttgart initially dismissed the claim and established the validity of the coaching contract. The Higher Regional Court (OLG) Stuttgart reversed this result and ruled in favour of the plaintiff. It decided that the coaching contract was void due to lack of ZFU approval and as a result the coaching provider had to refund the course fees already paid in the amount of EUR 23,800.00. Claims for payment of the remaining course fees consequently did not exist. The provider appealed against this decision to the Federal Court of Justice (BGH).

Decision of the Federal Court of Justice (BGH) on the classification of the coaching course as distance education

The Federal Court of Justice (BGH) dismissed the appeal and thus confirmed the judgment of the Higher Regional Court (OLG) Stuttgart. InUrteil vom 12.06.2025 – III ZR 109/24the Federal Court of Justice (BGH) took a position on several disputed factual elements.

Applicability of the FernUSG to a B2B coaching contract

The FernUSG applies, in departure from case law that has already been issued on this subject, not only to consumer contracts but also to a coaching contract with entrepreneurs. The Federal Court of Justice (BGH) justifies this on the grounds that the legislator did not provide for such a restriction to consumer contracts in the wording of the Act and that the protective concept of the FernUSG is intended to protect all potential participants – including commercial ones – from unsuitable distance learning courses.

Predominant spatial separation

Highly controversial was the question in which cases there is predominantly a spatial separation between teachers and students, in particular in online courses where instruction takes place live, for example in a synchronous video conference. The Federal Court of Justice (BGH) clarifies that a spatial separation pursuant to the FernUSG already exists if the asynchronous components of knowledge transfer – i.e. the components of the course that the course participant can view at a later time – predominate. This was the case here, as the predominant imparting of knowledge took place spatially separated through the asynchronous retrieval option of the teaching videos, homework and recorded online meetings.

Knowledge transfer

In the concrete case, the Federal Court of Justice (BGH) also considered the imparting of knowledge to be clearly in the foreground, since learning objectives had been predefined. In the course, it was not merely about individual advice, for example with regard to business optimisation. Rather, the coaching/mentoring programme was promoted with the imparting of "knowledge", "know-how" and "financial education" to the course participants. Furthermore, the defendant provider described itself as an "academy", which also suggests courses for the imparting of knowledge. The "online individual sessions with a personal coach to resolve personal blockages" that were also promoted as part of the programme were not in the foreground of the course.

Monitoring of learning progress

Monitoring of learning progress existed – as required by law – for the reason alone that participants could individually ask questions about learning content and monitoring of learning progress was possible. Even a single monitoring of learning progress provided for in the coaching contract is sufficient. In the present case, the programme description provided for the possibility of asking questions about the knowledge imparted both in the online meetings and by email or in a Facebook group. A further indication of monitoring of learning progress was the setting of homework, which had to be completed by the course participants. For the application of the FernUSG, moreover, it is not decisive whether the monitoring of learning progress provided for in the contract actually takes place, as long as such monitoring is contractually provided for.

Result

The Federal Court of Justice (BGH) decided that the coaching/mentoring programme offered constitutes distance education that must be approved under the FernUSG. Since there was no FernUSG approval for the programme, the coaching contract with the plaintiff course participant (and all other course participants) was void. The Federal Court of Justice (BGH) decided that the plaintiff receives a refund of the course fees already paid in the amount of EUR 23,800 because the payment was made without legal cause. A claim for restitution on the basis of the principles of unjust enrichment was also denied to the course provider because it had not sufficiently demonstrated that the plaintiff had saved expenses in a corresponding amount.

Conclusion

In light of this Federal Court of Justice (BGH) judgment, there is an urgent need for action for providers of digital coaching and mentoring programmes. We are happy to help you review your educational offerings, revise youronline coaching contractas appropriate and make programme adjustments to minimise your legal risks or support you in obtaining approval for your course offerings from the ZFU. Our law firmAVANTCORE Rechtsanwältein Stuttgart has extensive expertise in specialised lawyers in the classification of courses under the Distance Education Protection Act as well as in the strategic and contractual design of your coaching offering. We are happy to be your competent contact person.