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Reproduced with permission of Pace Review of the Convention on Contracts for the International Sale of Goods, Kluwer (1999-2000) 3-78

A Comparative Study of Specific Performance Provisions in the United Nations
Convention on Contracts for the International Sale of Goods

Nayiri Boghossian [*]
Damascus, Syria

Introduction

Chapter One. Specific Performance in a Bijuridical Context: the UN Sales Convention
I. General Introduction to The CISG
         A. History of negotiations
         B. General features of The CISG
II. Specific Performance in The CISG
         A. General introduction to the provisions related to specific performance
         B. Article 46: Buyer's right to compel performance
         C. Article 62: Seller's right to compel performance
         D. Article 28: Limitations on specific performance

Chapter Two. Comparative Study of Specific Performance
I. Meaning of the Term Specific Performance
         A. Introduction
         B. Specific performance in Common law: the Uniform Commercial Code (UCC)
         C. Meaning of specific performance in the CISG
         D. Exécution en nature in Civil law: Articles 1143-1144 French Civil Code
II. Primacy of the Remedy
         A. Introduction
         B. Specific performance as a secondary remedy in Common law
         C. Exécution en nature as the primary remedy in Civil law
         D. The primary remedy in the CISG

Chapter Three. Conclusions


INTRODUCTION

The importance of international transactions has increased in recent decades as a result of the reduction in trade barriers and the globalization trend. Countries have initiated improved relations with each other, creating a situation of interdependence. This globalization trend requires elimination of obstacles to trade. One such obstacle is the divergence of rules among legal systems, which gives rise to litigation and increases transaction costs for all parties.

A means to eliminate this obstacle is to unify rules regulating international transactions through international conventions. The purpose of such conventions is to eliminate, or at least reduce the potential conflicts when an international transaction is concluded.[1]

The United Nations Convention on Contracts for the International Sale of Goods (CISG) [2] is an example of this method of unification. The CISG, which is the result of decades of work, unifies the rules that govern [page 5] contracts for the international sale of goods.[3] Although the Convention has attained its purpose to a certain extent, it did not fully achieve unification because differences among legal systems are so deeply rooted, they are sometimes very difficult to eliminate.

Many issues were debated and negotiated during the developmental conferences of the CISG. One subject of debate was the remedy of specific performance.[4] The remedy of specific performance is interesting to examine because it has raised much controversy. In order to reach a unified rule, the divergent rules that govern specific performance must be examined to clarify why different legal systems address this subject in different ways.

The general purpose of all contract remedies is to place the aggrieved party in as good a position as he would have enjoyed had the other party performed his obligations under the contract. This means that all contract remedies must seek to protect one's contractual rights. Specific performance is one such remedy available to the aggrieved party. The purpose of specific performance is to help the creditor obtain, to the fullest extent possible, the actual subject matter of his bargain. In general terms, specific performance means the execution of a contract according to the precise terms agreed upon. But granting specific performance is not free of restrictions in all legal systems. Common law and civil law have different approaches to this matter,[5] which causes difficulty in compromising on the definition of specific performance rules within the CISG.

This article addreses, in the first chapter, an overview of the CISG. After a brief look at the history of negotiations and the main features of the CISG, the provisions regulating specific performance will be examined. Each provision will be explained, its rationale reviewed, and an assessment will be made. The second chapter deals with comparative issues regarding specific performance. These are the major differences between the two systems, which are reflected in the meaning of the term and the importance of the role that the remedy plays in each system. The French Civil Code [6] will [page 6] be studied, representive of civil law countries, and the Uniform Commercial Code (UCC) [7] provides a common law perspective.[8] The meaning of specific performance in these two codes and the rules that regulate this remedy will be examined in detail. How these differences are reflected in the CISG will be clarified by the study of the meaning of specific performance and the primacy of this remedy under the CISG. The overall purpose of this article is to highlight the differences between common law and civil law in order to assess whether a unified rule of specific performance was reached in the CISG and to propose certain amendments that will help achieve the purpose of unification.

CHAPTER ONE: Specific Performance in a Bijuridical Context: The CISG on Contracts for the International Sale of Goods

I. General Introduction to the CISG

A. History of Negotiations

International trade has substantially increased in recent decades and is no longer dominated by only a few of the most developed countries.[9] Global rules of international trade are now set by countries with different levels of economic and legal development, thus creating a very diverse legal framework for international transactions. The divergences in concepts, legal techniques and procedures that exist among those systems are reflected in the rules that govern the transactions. These differences in legal systems have created obstacles to international trade and often cause conflicts in international transactions. Moreover, having received training within their own national systems, jurists are often completely unaware of the differences of concepts and terminologies that exist between their own legal system and a foreign system. The ignorance about foreign systems often contributes to misunderstandings and difficulties in preliminary contract negotiations. [page 7] These issues surface when it comes time to execute a contract. One party's interpretation may differ from the other. Even if both parties use the same terminology they may still face these obstacles because often some of the same legal terms have different meanings in different systems. As a result, conflicts occur and parties only have recourse to litigation - a process that causes losses in money and time for the parties involved.[10]

Because the exchange of goods is one of the most common activities in international trade, countries have realized the importance of facilitating transactions in this field.[11] In order to overcome the barriers raised by the divergence of legal systems, there have been attempts to harmonize and unify rules of international trade law. An early effort at unification was launched by the Rome Institute for the Unification of Private Law (UNIDROIT) in the 1930s.[12] The Institute appointed a group of European scholars to draft a uniform law for the international sale of goods.[13] The work of the group led to the creation of two conventions: the Uniform Law for the International Sale of Goods (ULIS) [14] and the Uniform Law on the Formation of Contracts for the International Sale of Goods (ULF).[15] Countries adopting these two conventions were mostly European.[16] This is not surprising given the fact that the scholars who prepared the drafts were from continental Europe and civil law concepts prevailed.[17]

However, the creation of an internationally accepted convention in the field of international trade required world-wide participation. In order to [page 8] achieve this goal, the United Nations Commission on International Trade Law (UNCITRAL) was established in 1966.[18] The goal of this Commission is to promote harmonization and unification of international trade law.[19]

With the aim of creating a uniform law for the international sale of goods, the Commission first considered the possibility of promoting a wider acceptance of the ULIS and ULF conventions.[20] However, the response of participating governments to this proposal was not positive.[21] Therefore, a working group was established with world-wide representation.[22] Basing its work on ULIS and ULF, the efforts of the working group culminated in a conference conducted in Vienna in 1980 to finalize the draft of the Convention on Contracts for the International Sale of Goods (CISG).[23] Sixty-two states and eight international organizations participated in the conference.[24] After deliberations and some amendments, the draft was approved on April 11, 1980.[25]

It was no easy task to create a convention that would be acceptable to such a large number of countries with different legal systems and divergent political and economic policies.[26] Negotiations, therefore, were difficult. And what made reaching unified rules even more difficult was the opinion of participating delegates that their own legal system was superior to other systems, and the expectation that concepts and techniques of their domestic law would be embodied in the CISG.[27] When delegates participate in negotiations from the prespective that the international convention will [page 9] resemble their own law, reaching a consensus becomes nearly impossible.[28] In the case of the CISG, even a compromise became difficult to achieve.[29]

The degree to which States were ready to compromise was diverse.[30] Those who had a powerful position in the field of international trade had less reason to seek a compromise.[31] Therefore, the method of work adopted by the delegates was to seek practical solutions for different situations without letting the concepts and techniques of one system prevail in the CISG.[32] It is possible to categorize the divisions among negotiating parties into the following: civil law-common law, East-West and North-South conflict. Each category raised a problem different from the other.[33]

1. Debates in Civil law and Common law

The CISG represents a compromise between the civil law and common law systems, sometimes reflecting concepts that are unique to one system and not the other.[34] As a result of the divergence between the two systems, several issues became debatable during the negotiations. These issues included: the rule of consideration [35] (proper to common law systems), whether a contract is formed when the acceptance is sent or received,[36] the irrevocability of an offer,[37] and whether the primary remedy should be specific [page 10] performance (as in civil law) or damages (as in common law).[38] Other issues of controversy were price reduction and the notion of Nachfrist, which means the fixing an additional period of time for performance. These were matters in which the views differed greatly since both notions are foreign to the common law system.[39] The solutions adopted reflect the rules of both systems. In certain provisions, the rules of common law prevailed, while in others, the rules of civil law.[40] The method of compromise that satisfied the parties from both systems was adoption of a rule of one system with exceptions to it derived from the rules and concepts of the other system.[41]

2. East-West Debate

The debate between the "eastern bloc" and "western bloc" countries can be characterized as a debate between rigidity and flexibility. Socialist countries wanted to ensure security and foreseeability while western systems opted for flexibility in contractual relations.[42] The different views were reflected in the rules regarding the requirement of writing, which is a precondition for concluding a contract in planned economies, but not in western legal systems.[43] Requiring a contract to be written ensured certainty for eastern bloc countries while western countries viewed that condition as a hindrence to timely execution of a contract.[44] As a result of this difference in views, the CISG adopted the western approach but gave the option for countries that disagreed with it to exempt themselves from this provision.[45] [page 11]

Another issue of debate among the delegates was the "open-price term." In particular, the socialist group strongly opposed this provision because it did not fit with their predetermined economic planning.[46] This view was also shared by some civil law systems.[47] In contrast, western countries (especially the United States) were in favor of open-price contracts.[48] The final provision of the CISG regarding this matter favors the open-price rule.[49]

The role of trade usage was also debated. For western countries, trade usage ensured flexibility, something upon which eastern countries placed little importance.[50] Socialist countries suspected that giving a role to trade usage in the CISG would lead to uncertainty because these usages can differ greatly from one country to another.[51] Usage is accepted as a means of regulating the relations between the parties in the CISG.

One last issue that raised controversy between eastern and western bloc nations was the form of acceptance. Socialist systems require that acceptance be identical to the offer for the contract to be validly formed, more commonly referred to as the "mirror image rule."[52] This rule, which is also shared by many western countries, is not applied in the United States.[53] In the United States, a contract can be formed even when the acceptance differs from the offer, unless it alters it materially.[54] The CISG adopted the former point of view because it was supported by a majority of the delegates.[55] Nevertheless, the latter view was also, in a sense, accepted, since the CISG mentions that alterations may be considered as acceptance as long as they are not "material."[56] [page 12]

3. North-South Debate

The difference in the levels of development and in the nature of economic activity between developed and developing countries gave rise to many conflicts during the negotiations.[57] In general, developing countries try to get more advantageous conditions in negotiations on the international level.[58] These countries point to their weaker economic position as the basis for needing a better negotiating position; however, they must also be motivated by their suspicion of the intentions of developed countries.[59]

One of the issues discussed was the time limit within which the buyer should give notification for the non-conformity of goods.[60] The lack of expertise in developing countries made them demand a longer period of time and less harsh sanctions for failing to give notice.[61] The delegates from developed countries were concerned that a buyer from a developing country would not be able to discover the defects in a reasonable time, and thus, would not be able to give notice to the other party in due time.[62]

Another issue that developing countries opposed was suspension of performance and anticipatory breach by a party who believes that the other is unable to meet his promises.[63] Developing countries wanted to ensure that the grounds for suspension were objective because they feared the abuse of power by a party from a developed country.[64] [page 13]

Similar to eastern bloc countries, developing countries also opposed the application of trade usage.[65] The less developed countries' rationale for this opposition was that trade usage reflects the interests of developed countries since they are defined as standard "trade usages" by developed countries.[66] Conversely, developed countries place great importance on trade usage because they provide flexibility and efficiency.[67]

In all of the aforementioned situations, a settlement was reached among the CISG delgates. Though the views were very diverse, the solution adopted was always a compromise and not a solution to which all parties gave full consent.[68] Nevertheless, compromises usually satisfied, to some extent, each participating party.[69]

B. General Features of The CISG

The CISG is drafted using simple and clear language. The fact that negotiators were from different legal backgrounds made it necessary to draft the CISG in terms that are comprehensible to all parties. The need for clarity also arose from the fact that the CISG is addressed not only to jurists, but also to businessmen.[70] In this respect, the CISG differs from its antecedents, the ULIS and ULF, which were complicated texts that included a greater number of provisions.[71]

The CISG applies to contracts for the sale of goods [72] when the parties have their places of business in States that are parties to the CISG or when [page 14] the rules of private international law determine the law of a Contracting State as the law applicable to the transaction.[73] Nevertheless, parties to a contract have the right to exclude the application of the CISG.[74]

The CISG rules regarding the formation of a contract require that the offer be sufficiently definite and demonstrate the intention of the parties to be bound.[75] Acceptance may be communicated verbally or by conduct indicating assent.[76] There are no requirements regarding the form of acceptance.[77]

Obligations of both seller and buyer, as well as the remedies available to each of them, are dealt with in Part III of the CISG.[78] This part also contains rules regarding the passing of risk and some general provisions that apply to both seller and buyer.[79]

Obligations of the seller include delivery of goods that are in conformity with the contract and delivery of documents that transfer ownership in the goods.[80] The buyer's obligations are to take delivery and make payment of the price.[81] The buyer should also examine the goods to verify conformity and give notice of non-conformity to the seller within a reasonable period of time.[82]

The remedies available for both the buyer and the seller are described in a unified scheme that is clear and easy to follow.[83] This scheme reflects the compromise between civil law and common law aspects.[84] The range of remedies is more comprehensive than what is available under common law [page 15] and some of these remedies are even foreign to common law.[85] The issue of remedies is one of the areas in which the diversity of legal systems is obvious.[86]

The remedy that raised most controversy, however, was specific performance.[87] In civil law, specific performance is the primary remedy while in common law the primary remedy is damages.[88] The CISG makes specific performance available to both the seller and the buyer.[89] The specific CISG provisions that govern specific performance will be examined in detail later in this article. The other remedies available for the buyer include avoidance, which can be exercised in case of fundamental breach, and damages or price reduction, which are used in cases where there is no performance, even after the fixing of additional time.[90]

The seller's remedies include requiring the buyer to perform by paying the price or taking delivery, avoidance of contract when the breach is fundamental, and damages.[91] Similar to the buyer's right, the seller may also fix an additional time for performance at the end of which he is free to avoid the contract.[92]

The CISG includes certain provisions that are common to the obligations of both the seller and the buyer. These provisions deal with suspension of a contract, avoidance before the date of performance, damages and exemptions.[93] Suspension of a contract means that a party can suspend the performance of his obligations if it becomes clear after the contract is concluded that the other party will not perform a substantial part of his obligations.[94] Anticipatory breach gives a party the right to avoid the contract if he detects that the other will commit a fundamental breach before performance is executed.[95] [page 16]

Damages include not only compensation for the expenses incurred by a party, but also the loss of profit.[96] The amount of damages is limited by two conditions: foreseeability and mitigation.[97] Foreseeability means that damages may not exceed the loss that the party in breach foresaw or should have foreseen.[98] The mitigation rule imposes on the innocent party the duty to mitigate the loss.[99] The right to receive interest is also available in addition to the right to damages.[100]

The CISG also deals with situations in which a party is not able to perform due to "an impediment beyond his control and that he could not reasonably be expected to have taken the impediment into account at the time of the conclusion of the contract or to have avoided or overcome it or its consequences."[101] The last part of the CISG contains provisions according to which a state may formulate its reservations.[102] A Contracting State can choose to exclude the application of provisions regarding the formation of a contract or those related to sale of goods.[103]

After brief examination of the history and general provisions of the CISG, one can notice that a convention of this magnitude is difficult to achieve and therefore, solutions adopted reflect the influence of different legal systems. The sale of goods, and international trade in general, is a field in which a uniform law can be reached because of similarity in the way business transactions are conducted throughout the world. The CISG provisions regarding specific performance, however, have been the target of much debate and negotiation. Therefore, the provisions governing specific performance are examined in this article to highlight differences in concepts and techniques between legal systems and to demonstrate how a compromise was reached in the creation of the CISG.[page 17]

II. Specific Performance in The CISG

A. General Introduction to the Provisions Relating to Specific Performance

The CISG gives the right to require specific performance to both the seller and the buyer.[104] Article 46 provides this right to the buyer under certain limitations and Article 62 provides the same right to the seller.[105] The CISG adopts the primacy of specific performance as a rule, therefore, one may think that civil law has prevailed with regard to this remedy. In fact, a compromise was reached in this matter, as was the case in other provisions of the CISG.[106] The "middle ground" reached is reflected in the adoption of Article 28.[107] This article was introduced in the CISG for the purpose of satisfying common law countries where the primary remedy for non-performance is damages, and specific performance has a limited role.[108] An aggrieved party can only have recourse to specific performance under certain conditions that will be examined later in this article. According to Article 28, a court is not bound to grant specific performance unless it would do so under its own law in respect of similar contracts not governed by the CISG.[109]

B. Article 46: Buyer's Right to Compel Performance

Article 46 deals with the situations in which a buyer can have recourse to specific performance. It states that:

"(1) The buyer may require performance by the seller of his obligations unless the buyer has resorted to a remedy which is inconsistent with this requirement.

"(2) If the goods do not conform with the contract, the buyer may require delivery of substitute goods only if the lack of conformity [page 18] constitutes a fundamental breach of contract and a request for substitute goods is made either in conjunction with notice given under article 39 or within a reasonable time thereafter.

"(3) If the goods do not conform with the contract, the buyer may require the seller to remedy the lack of conformity by repair, unless this is unreasonable having regard to all the circumstances. A request for repair must be made either in conjunction with notice given under article 39 or within a reasonable time thereafter."[110]

1. The Right to Require Specific Performance

Specific performance is the primary remedy available in Article 46.[111] Subject to Article 28, discussed in Part D below, courts do not have the right to refuse to grant specific performance when the buyer seeks this remedy.[112] The CISG has certain provisions that even more clearly demonstrate the priority given to specific performance. The buyer, for example, has the right to fix an additional time for performance.[113] Also, the seller has the right to cure before the contract is avoided.[114] The seller's right to cure and the buyer's right to fix an additional time are precluded only when the breach is fundamental.[115] Where fundamental breach has occurred, the buyer has the right to avoid the contract without asking for specific performance.[116]

2. Recourse to Inconsistent Remedies

The right to require specific performance is subject to the condition of having no recourse to other remedies that are inconsistent with it.[117] Inconsistency arises when the buyer avoids the contract because, in so doing,[page 19] he releases the other party from his contractual obligations, and therefore can no longer demand performance.[118] The other remedies inconsistent with specific performance are the reduction of price and damages (unless damages are for late performance) because these remedies and specific performance compensate for the same thing; and it is not reasonable that the buyer receive compensation twice.[119] The buyer can require performance in cases where there is non-delivery of goods or in cases where the exchange of documents signifies the transfer of property.[120]

3. Paragraphs (2) and (3): Compelling Delivery of Substitute Goods or Repair

Paragraph (2) of Article 46 gives the buyer the right to require the delivery of substitute goods when the goods delivered are not in conformity [121] with the contract, and this non-conformity constitutes a fundamental breach.[122] Requiring delivery of substitute goods is one form of specific performance. This remedy is limited by the conditions of the breach. Additionally, notice of a breach must be given within a reasonable time.[123] When the breach is not fundamental, the buyer has recourse to repair, price reduction or damages.[124]

The right to require repair is provided for in paragraph (3) of Article 46.[125] It is limited to situations where it is reasonable to repair under the circumstances.[126] The reason delivery of substitute goods is available only in [page 20] cases of fundamental breach is to avoid hardship to the seller, since the delivery of certain goods, and especially heavy machinery, is very costly.[127] The seller must bear the cost of transporting the conforming goods to the buyer and the cost of transporting the non-conforming goods back to his place of business.[128] Alternatively, he may resell the non-conforming goods, which will likely be difficult if he does not have the necessary network in a foreign market.[129] Another burden may arise when the delivered goods have perished as result of improper storage.[130] For all these reasons, it is unfair to put such a heavy burden on the seller when the non-conformity is negligible.[131] Repair in such cases will satisfy the buyer without causing unnecessary hardship to the seller.[132]

The same concern for not causing hardship to the seller is the underpinning of the provision that governs the right to repair. The buyer can require repair if it is reasonable to do so.[133] This means that when repair by the seller is very onerous, the buyer cannot claim repair, especially when it may be possible for the buyer himself to do the repair.[134] It is also unreasonable to require repair when the cost is higher than the cost of buying new goods.[135] The reasonableness of the demand is judged according to the circumstances surrounding the contract and the conflicting interests of the parties.[136]

When the repair is not reasonable, the buyer will be entitled to damages or a reduction in price. As provided in paragraphs (2) and (3), the notice of non-conformity must be given within the time limit provided for in the CISG.[137] The time limitation serves the interests of both parties. It is important for the buyer to receive the goods within a certain period of time,[page 21] otherwise the receipt of the goods will have no meaning for him. As for the seller, he is protected from the constant threat of claims.[138]

The provisions of Article 46 reflect a concern for the integrity of a contract.[139] The buyer's right to require performance makes the seller place a greater importance on the agreement itself. This view reflects the civil law approach, which considers a contract as the primary law governing the relation between the parties.

4. Rationale and Assessment of Article 46

The CISG provides a right to require performance, although specific performance is not the primary remedy adopted by all legal systems. And while there has been opposition to this provision, the CISG nevertheless provides the right to require specific performance.[140] The rationale behind adopting this provision is that the formation of a contract is reached with the consensus of both parties. Thus, each party is entitled to receive exactly what he contracted for.[141]

Another reason, which applies especially to international sales, is that buyers in certain countries cannot find the goods contracted for in local markets or any other accessable markets.[142] Even when goods are available, it's difficult to substitute goods of the same quantity and quality as specified in the contract. Moreover, substitute goods only may be available for an unreasonable price or may not be available within the required time limit. In fact, this is exactly why a buyer will turn to the international market to procure the needed goods.[143]

Another argument set forth by proponents of specific performance is that granting damages requires time to assess and quantify the loss, which [page 22] will result in additional expenses and delay for parties.[144] However, this inconvenience also arises in cases where specific performance is granted, since the buyer may seek recourse to litigation, which also costs time and money.[145] The only difference is that with specific performance, there is no need to assess or quantify damages.[146]

The practicality of granting of specific performance is questioned by some with regard to its efficiency.[147] In many cases a buyer will not request specific performance because it is time consuming for him, and he needs to receive the goods within a certain time limit.[148] Therefore, it may be easier and faster to buy goods elsewhere and seek damages.[149]

On the other hand, it may not be possible for the buyer to find substitute goods of the same quantity and quality as required, especially in an international sale.[150] A buyer will often turn to the international market because he cannot find the goods in his local market.[151] Another difficulty in finding similar goods in the international market is that the buyer may not have access to other markets, or he may not have the ability to find other sellers.

These two difficulties are especially true with buyers from planned economies and developing countries where the availability of goods is limited and where access to other parts of the world is not easy. Interaction with the outside world is hindered by the underdevelopment of communication systems and by restrictions imposed by governments. Considering these factors, one will find specific performance beneficial in international sales. Additionally, it is arguable that the interests of developing countries should be offered greater protection in international conventions. After all, the purpose of international conventions is to promote the welfare of countries through cooperation and common efforts. Developing countries need extra assistance from other countries, and therefore, in every international [page 23] convention, the situation of developing countries should be given this due consideration. Regarding the practical benefit of specific performance, one may argue that specific performance motivates the seller to respect the agreement knowing that if he does not do so voluntarily, he may be compelled to do so because of the buyer's right to specific performance. This in turn will reduce the number of bad faith breaches.

C. Article 62: Seller's Right to Compel Performance

The CISG also provides for the seller's right to specific performance.[152] Article 62 is drafted in an analogous way to Article 46.[153] It states that "[t]he seller may require the buyer to pay the price, take delivery or perform his other obligations, unless the seller has resorted to a remedy which is inconsistent with this requirement."[154] According to this article, the seller may force the buyer to perform his obligations, which are primarily taking delivery and paying the price.[155]

1. Rationale of Article 62

The rationale behind Article 62 is the same as Article 46: to promote respect for the agreement and to ensure there is adequate compensation.[156] Damages may take time to be assessed and may be inadequate because they do not compensate for certain expenses suffered by the innocent party.[157] Another rationale behind Article 62 is the difficult task of the seller to dispose of goods when the buyer refuses to take delivery.[158]

Article 62 includes a provision similar to that of Article 46 whereby the seller may not resort to inconsistent remedies.[159] The seller may not compel performance if he has chosen a remedy inconsistent with specific [page 24] performance.[160] An inconsistent remedy in the case of breach by a buyer is avoidance.[161]

In considering the CISG provisions that govern the right to compel payment of price as one type of specific performance, the CISG is markedly different from some domestic laws. In certain domestic systems, the right to compel payment of the price when the buyer has accepted the goods is presented as a right to collect a debt. This right to collect, however, does not fall under the rules regulating specific performance. Another difference between domestic systems and the CISG is that certain domestic legal systems provide that the seller cannot force the buyer to accept the goods unless he is unable to resell them after reasonable effort.[162] The CISG gives the seller the right to compel acceptance without the aforementioned condition.[163]

2. Assessing Article 62

The right of the seller to enforce performance eliminates the expense and delay of seeking another buyer or negotiating a substitute transaction. This is an especially important right in cases where the goods have reached the destination port and the buyer refuses to take delivery.[164] In such a situation the seller may not be able to resell the goods in that market because it may be a foreign market, unknown to the seller.[165] In this way, specific performance provides a more appropriate form of compensation than damages because it gives a seller exactly what he expected from the contract.[166]

Forcing the buyer to perform may prove burdensome as the refusal of the buyer to take delivery may be due to certain changes in the market where he planned to resell the goods, which make it either difficult to sell or at least unprofitable. Specific performance, in such cases, is not entirely fair because the buyer is not responsible for changes in conditions of the marketplace, which are often unpredictable, even for a prudent businessman. This is especially true in countries where the economy is strictly regulated [page 25] by a government that issues regulations limiting the price of selling to consumers, thus reducing the profit margin for the party who has already made an international contract. Other regulations that may reduce the profits are ones that increase the tariffs imposed on imported goods. In these circumstances, it is unjust to compel the buyer to take delivery or pay the price.

D. Article 28: Limitations on Specific Performance

As mentioned earlier, the drafters of the CISG tried to reconcile civil and common law systems.[167] This task is most difficult where there is a major discrepancy among various legal systems, as is the case with specific performance.[168]

The civil law approach prevailed in Articles 46 and 62, thus making specific performance the primary remedy without the pre-condition of the inadequacy of damages and without the courts having any discretion in granting it.[169] The notion of inadequacy of damages, which is a prerequisite to specific performance in common law, does not exist in civil law. The common law approach to specific performance is also based on a theory of economic efficiency.[170] It may be more efficient to seek a substitute transaction rather than to force the other party to perform.[171] Nevertheless, the objections to specific performance emanating from delegates of common law countries made it necessary to introduce into the CISG limitations on specific performance based on the rules of domestic laws.[172] This was achieved by adding Article 28 in the CISG.[173]

1. Meaning of Article 28

Article 28 reads as follows:[page 26]

"If, in accordance with the provisions of this Convention, one party is entitled to require performance of any obligation by the other party, a court is not bound to enter a judgement for specific performance unless the court would do so under its own law in respect of similar contracts of sale not governed by this Convention."[174]

The language of Article 28 is not entirely clear. Therefore, an examination of this provision must start with examination of terms that are ambiguous. Phrases like "its own law," "similar contract of sale not governed by this Convention,"and "specific performance," are terms that have different connotations depending on whether they are read by a common law or a civil law jurist.[175]

The phrase "its own law" raises the question of whether the law is the substantive law of the forum or its entire law, including rules of conflicts of law.[176] Examination of the purpose of the article makes it evident that what is meant is the substantive law of the forum. The purpose of Article 28 is to permit a court to preserve its own domestic law on specific performance and not force it to order specific performance when it is not available under that legal system.[177] However, interpreting the phrase "its own law" to include the rules of a given court could cause the applicable law to be that of a foreign country and, possibly, one that freely grants specific performance. This will eliminate the ability of the court to preserve its own national laws that do not grant specific performance. In so doing, the purpose of Article 28 will not be attained.[178]

The other purpose of Article 28 is to avoid the problem that may arise when specific performance is claimed in a country whose own national [page 27] laws have no mechanisms for enforcing specific performance.[179] Therefore, by interpreting the term "its own law" as referring to the substantive law of the forum, the purpose of Article 28 is achieved.[180]

The meaning of the phrase "similar contracts" embraces all sale contracts that are outside the scope of the CISG.[181] This includes domestic contracts of sale and contracts between parties from countries that do not subscribe to the CISG, but excludes the contracts listed in Article 2 of the CISG.[182]

The full meaning of the term "specific performance" can ony be revealed by comparing its meaning within the context of the civil law and common law systems.[183]

2. Rationale of Article 28

The reason Article 28 is included in the CISG was to satisfy common law countries.[184] The CISG was the result of negotiations and compromises between the delegates of different countries and therefore, it was necessary to make the provisions regarding specific performance more flexible.[185] In order to preserve the tradition of common law countries and not force them to make a major change in their position toward specific performance, a compromised solution was adopted in Article 28.[186] As mentioned [page 28] above, the issue of specific performance was a one of major differences between the two systems regarding its availability as a remedy [187] and the mechanisms of enforcement.[188]

3. Assessing Article 28

The purpose of the CISG is to create a uniform law for international sales and ensure that countries apply the same rules to similar cases. Article 28 is therefore inconsistent with the aim of the CISG because it allows the application of different rules depending on the law of the forum,[189] thus, impeding unification.[190] In addition to hindering unification, Article 28 gives rise to uncertainties in the application of the CISG.[191] The outcome of litigation regarding remedies depends on the law of the forum.[192]

On the other hand, one may argue that although the CISG does not impose the remedy of specific performance in domestic laws, it creates the chance to broaden the application of specific performance by giving a court the right to choose between applying domestic law or the rules of the CISG.[193] Thus, even when the domestic law does not provide for specific performance, the court may choose to grant specific performance by relying on the provisions of the CISG.[194] Also, some argue that the cases where specific performance is requested by parties to an international sale are mainly cases where specific performance is granted in common law systems.[195]

A true assessment of the effect that Article 28 has on uniformity can be achieved only after examining domestic rules of specific performance in common and civil law jurisdictions. This will be done in the following chapter of this article.[page 29]

CHAPTER TWO: Comparative Study of Specific Performance

I. Meaning of the Term Specific Performance

A. Introduction

Using the term "specific performance" in the CISG gives rise to a certain ambiguity as to its precise meaning. This uncertainty is not due to unclear language but due to a divergence of concepts between legal systems.[196] The confusion caused by using the term "specific performance" arises from it having different connotations in civil law and common law systems.[197]

Ambiguities in international conventions may be resolved when drafters clarify their intentions and the meaning they envision for any given term or provision. Unfortunately, the drafters of the CISG did not always state the clear intention of every provision in the Convention. Therefore, clarification of the meaning of the term specific performance requires a comparative analysis of what the term connotes in various legal systems to reveal the intentions of the drafters.

The meaning of the term specific performance to a common law jurist is different from the meaning it has for one from a civil law system.[198] Its equivalent in French Civil Code is exécution en nature.[199] Differences exist between the content of exécution en nature and that of "specific performance," even though both terms represent the same type of remedy that enforces contractual obligations and protects the expectations of the parties.[200]

B. Specific Performance in Common law: The Uniform Commercial Code (UCC)

When granting specific performance in common law, the court orders the defendant to do specifically what he promised.[201] The order forces the defendant to perform [page 30] the obligation himself and the failure to perform such an order constitutes contempt of court and may be sanctioned by fines or imprisonment. Moreover, there are no rules of execution at the expense of the debtor, as is found in civil law systems.[202] This distinction makes the application of exécution en nature wider than that of specific performance.

Another difference is that an order of specific performance in a civil law system may include any number of obligations, including the transfer of property or the requirement to perform a certain act. Conversely, an order for the buyer to pay the price does not fall within the realm of specific performance in common law systems.[203] Also, a requirement that the seller repair is not considered specific performance as it is in both civil law systems and in the Convention.[204] Examination of the Uniform Commercial Code (UCC) as an example from a common law system helps to better understand these differences.

The rules relating to specific performance in the UCC are provided in section 2-716. Paragraph (1) of this section gives the buyer the right to specific performance when the goods are unique.[205] The order for specific performance is addressed to the seller.[206] Paragraph (3) of the section provides the right to replevin, which is an authorization to seize goods and deliver them to the buyer.[207]

The buyer has a right of replevin for goods identified in the contract if, after reasonable effort, he is unable cover for such goods, or if the circumstances reasonably indicate that such effort will be unavailing, or if the goods have been shipped under reservation and satisfaction of the security interest in them has been made or tendered.[208]

Replevin gives the buyer the means to recover goods from the seller by way of seizure. This act of a third party - usually a sheriff - is not considered specific performance because the right to replevin is based on a property right and not on a contractual right.[209] This means that [page 31] performance by a third party is not considered specific performance, as is the case in civil law.[210]

The seller's right to receive the price is governed by section 2-709 of the UCC, which states:

"(1) When the buyer fails to pay the price as it becomes due the seller may recover, together with any incidental damages under the next section, the price

(a) of goods accepted or of conforming goods lost or damaged within a commercially reasonable time after risk of their loss has passed to the buyer; and

(b) of goods identified to the contract if the seller is unable after reasonable effort to resell them at a reasonable price or the circumstances reasonably indicate that such effort will be unavailing."[211]

An action for the price is not an action for specific performance. The provisions relating to it are mentioned in a section different from the buyer's right for specific performance, and the term "specific performance" is not mentioned in this section.[212] This indicates that the drafters of the UCC did not consider the seller's right to recover the price as specific performance, which is different from the civil law approach.

C. The Meaning of Specific Performance in the CISG

When one seeks to determine the meaning of a legal term in an international convention such as the CISG, one should bear in mind that the terms are not necessarily derived from the meaning they have in certain legal systems, but instead reflect the intentions of the CISG's drafters.[213] Therefore, in clarifying the meaning of specific performance, one must [page 32] reject the connotations of the term in domestic law and try to reveal the meaning as it was intended within the context of the CISG.[214]

The CISG has provisions that assist in its interpretation and that promote uniform application. It is not enough to establish uniform rules and incorporate them in an international convention. In order to achieve uniformity in rules among Contracting States, it is necessary to apply the provisions of the CISG in a uniform way. To achieve this uniformity of application, it is necessary that parties to the CISG interpret the rules in the same manner. The drafters of the CISG were aware of the importance of this issue. This is why rules and general principles for interpretation were included in the CISG.

However, as the number of countries that participate in a convention rises, the issue of interpretation become increasingly problematic. It is therefore necessary to examine the provisions regarding interpretation in the CISG to determine the meaning of specific performance.[215]

One of the principles for interpretation stated in the CISG is to take into consideration the international character of the CISG.[216] This means that the terms used in the CISG do not have the same meaning as they do in a national system, and some concepts simply cannot be explained under the principles of domestic law.[217] In order to facilitate the interpretation process, one may look at the deliberations and negotiations that led to the final drafting of the CISG. Preparatory materials deal with each article of the CISG and give important information about each provision regarding its purpose and rationale.[218] Consultation of foreign case law also helps to achieve this purpose.[219] [page 33]

The term specific performance as used in Article 28 of the Convention refers to orders of performance addressed to the seller or the buyer. The preparatory materials of the CISG make it clear that the seller's action for the price is considered an action for specific performance even though the term specific performance is not used in Article 62. Article 28 of the CISG, which limits any right to performance when it is derived from the law of the forum, applies to both Article 46 and Article 62. Also, a commentary of the Secretariat on Article 26 of the 1978 Draft Convention, which is the predecessor of Article 28, mentions the seller's right to require the price as being a claim for specific performance.[220] This means that the action to recover the price is considered specific performance. Therefore, specific performance in the CISG includes any order compelling either party to perform contractual obligations.

The right to repair is provided under Article 46(3), which is the main article dealing with the buyer's right to compel performance. This article gives the buyer the right to claim repair when the goods are not in conformance with the contract. This shows that repair is one method to obtain specific performance and is contrary to its character under the common law.[221]

As for performing at the expense of the debtor, there are no rules in the CISG that provide for this arrangement, which means that the civil law approach in this matter was not adopted. When the non-conformity of goods does not amount to fundamental breach and repair is not reasonable, the buyer has the right to damages or price reduction, but has no right for performance at the expense of the debtor.[222]

The meaning of specific performance in Article 28 of the Convention is similar in some respects to the meaning of specific performance under both the civil law and the common law. When applying the rules of specific performance, judges should therefore bear in mind the scope of the term as set forth in the CISG.[page 34]

D. Exécution en Nature in Civil law: Articles 1143-1144 in French Civil Code

In civil law, an order of exécution en nature includes not only the right to force the debtor to perform his obligations, but also gives the creditor the right to receive performance at the expense of the debtor.[223] This is only possible when the personal participation of the debtor is not necessary for the performance of the obligation.[224]

When a civil law court gives an order of exécution en nature, this means the plaintiff will receive what he is entitled to by the contract.[225] Performance, in this context, does not necessarily mean execution by the defendant himself since there are several means for the court to enforce performance.[226] It may be accomplished by a third party - a sheriff - or by the defendant.[227] The plaintiff may also have the obligation carried out by executing it himself at the expense of the debtor.[228]

Exécution en nature is also broadly applicable in the sense that it is used to enforce obligations to perform and to refrain from performance. Obligations to refrain from performance are enforced in common law by way of prohibitory injunctions.[229] These differences in the content of the term exécution en nature must be borne in mind when examining rules relating to it.[230]

Taking the French Civil Code as an example of a civil law system, the difference becomes clear when examining Articles 1143 and 1144. These two articles state in very clear language the right of the creditor to execute the contract at the expense of the debtor.[page 35]

1. Article 1143: Eliminating the Violation at the Expense of the Debtor

Article 1143 deals with debtors who violate obligations to refrain.[231] The article gives the innocent party the right to eliminate what the other party has done in breach of the contract at the latter's expense.[232] The article reads as follows:

"Néanmoins, le créancier a le droit de demander que ce qui aurait été fait par contravention à l'engagement soit détruit; et il peut se faire autoriser à le détruire aux dépens du débiteur, sans préjudice des dommages et intérêts, s'il y a lieu."[233] [page 36]

When the debtor has acted in violation of the agreement, the creditor may ask the court for permission to eliminate what the debtor has done as infringement of his obligations.[234] This kind of enforcement does not require the participation of the debtor and it does not impose anything on his person because the coercion is indirect and the final effect on the debtor is merely financial. The debtor only must pay for the expenses.[235]

2. Article 1144: Performance at the Expense of the Debtor

Article 1144 applies to obligations "to do." It may also apply to obligations to give. It states that "Le créancier peut aussi, en cas d'inexécution être autorisé à faire exécuter lui-même l'obligation aux dépens du débiteur."[236] [page 36]

This article gives the promisee the right to receive performance at the expense of the debtor.[237] This can be accomplished only when the cooperation of the debtor is not necessary.[238] The execution of the obligation may be performed by the creditor himself or by a third party, such as a court official. The article makes no distinction between obligations "to do" and obligations "to give," which indicates that it applies to both.[239] The court in such cases gives permission for the creditor to receive performance and the debtor to pay expenses. It may be possible for the creditor to receive an advanced payment from the debtor. The debtor here is only required to pay the expenses, which means that for the debtor, the obligation resolves into the payment of a sum of money and for the creditor, the obligation is performed.[240] An example of this situation is when the seller does not deliver goods that are generic and the creditor buys the goods elsewhere and then receives compensation from the debtor. When the obligation is to do a legal act, such as the transfer of property as result of a promise of sale, the judgment of the court constitutes good title for the creditor.[241]

When the obligation is to give, attachment of the chattel and delivery of it to the creditor will result in performance of the contract.[242] Nevertheless, when the obligation is "to do" an act that cannot be performed by a party other than the debtor, Article 1144 cannot be applied because the participation of the debtor is required. An example of this is a seller who exercises special skills in the manufacture of goods, or uses special material that may not be available to other sellers. In such a case, the debtor is forced into doing the act unless it requires coercion on his person.[243] [page 37]

II. Primacy of the Remedy

A. Introduction

The importance of the role of specific performance constitutes a major difference between common law and civil law systems. Under the common law, the primary remedy is damages. This means that a court only may grant specific performance when damages would be inadequate compensation. The court also has discretionary power in granting specific performance. It is not a right of the plaintiff, but inseatd, is left to the court to decide whether or not to grant it.

The situation is entirely different in under a civil law system. Contrary to common law, damages are only a secondary remedy. The primary remedy is specific performance and a court must grant it unless the circumstances give rise to certain exceptions. A civil law court does not have the discretionary power to grant specific performance.

This divergence of approaches can be explained to a great extent by history. Therefore, it is necessary to examine the historical development of specific performance rules in the two systems and how the differences are reflected in current legislation.

B. Specific Performance as a Secondary Remedy in Common law

1. History: Development of Equity Courts

When examining the rules of specific performance in common law, one should begin with a review of the development of equity courts, as it was through these courts that specific performance was introduced into the common law system. The main role of the equity courts was to alleviate hardship by offering remedies that were unavailable in law and that insured adequate compensation for the plaintiff. One could only have recourse to an equity court when the remedy available in law was inadequate.

Rules of recourse evolved to complement the rules of law, and were formed in such a way that left little room for exceptions. These rigid of rules of law had to be surmounted in order to achieve full justice in society. Equity would intervene to alleviate this harshness.[244] The complementary role [page 38] of equity was embodied in the rule that "equity follows the law." Equity could only interfere when the rules provided in law were inefficient in protecting a party's right. It was only then that a court of equity could order specific performance to ensure that the plaintiff enjoyed full protection of his rights by receiving exactly what he was entitled to under a contract.

In fourteenth century England, a set of rules for granting specific performance developed [245] and a separation between law and equity evolved. At this time, the Courts of Chancery began to apply equity and the Chancellor, in exercising his powers, adhered to the requirements of conscience.[246] These requirements varied depending on the Chancellor's personal beliefs. Thus, it was exercised in a discretionary manner because moral values differ among individuals.[247]

A Chancellor would impose a behavior "consistent with the dictates of conscience." He would order the defendant to do a conscientious act that could only be executed by the defendant. In this respect, specific performance in common law differs from civil law, where the purpose is to grant the plaintiff what he expects from the contract and this may be achieved without the participation of the defendant.[248] In forcing a defendant to do the required act, the equity court had recourse to imprisonment or fines.[249] The threat of imprisonment would coerce a reluctant defendant into performing his obligations. This rule, however, evolved over time because the notion of imprisonment for civil debts became unthinkable in modern society.[250]

2. Character of the Remedy

a. Exceptional

Since equity courts could only interfere when the remedies in law were inadequate, the remedies they granted acquired a characteristic that was akin to specific performance. The exceptional character of specific [page 39] performance makes it a secondary remedy in common law systems, meaning it can only be awarded when it is not possible to award the primary remedy, which is damages.[251] Thus, the main condition for granting specific performance is inadequacy of damages. Only when damages do not compensate for the loss may a court order specific performance. This condition will be examined later in detail.[252] There are also other conditions that give rise to the granting of specific performance, but they are less common.

One of the restrictions on specific performance as a remedy is seen in cases where performance requires constant supervision by the court.[253] This arises when the act required is a continuous or ongoing obligation. The cost of ensuring performance in such a situation may outweigh the benefits that the plaintiff receives. Therefore, the court will not order specific performance because it will be too costly and will result in waste of time and money.[254] Another restriction is a lack of mutuality, which means that each party must have the right to receive specific performance at the time the contract was concluded. The rationale behind this condition is to ensure that the defendant, who is obliged to perform, has the right to receive the counter-promise.[255]

One important limitation is when specific performance imposes restrictions on the personal freedom of the defendant.[256] But this problem does not arise in contracts for the sale of goods.[257] Other situations in [page 40] which common law courts do not grant specific performance include gratuitous promises [258] and situations where the performance of a contract is against public policy.[259] Courts also refuse to grant specific performance when it causes hardship to the defendant or when there has been unfair conduct by the plaintiff.[260]

b. Discretionary

The discretionary character of specific performance grew out of the role of equity courts to satisfy the requirements of conscience. As mentioned earlier, the rules of equity were based on the imperatives of conscience determined by the Chancellor. There was no set of rules or established precedents. Therefore, the conditions of granting specific performance differed depending on the beliefs of the Chancellor. He was not under the obligation to grant specific performance whenever claimed by the plaintiff; it was left to his discretion. Currently, this discretionary character still exists but there are certain rules and precedents that specify the conditions of granting specific performance.[261] The degree of discretion in current legislation will be clarified later when examining the rules of the Uniform Commercial Code.

3. Damages: The Primary Remedy

Specific performance developed in common law because of the sometimes inadequate nature of damages. The rule is that whenever damages are adequate compenstion for the plaintiff, there is no reason to grant specific [page 41] performance. Damages being the primary remedy, specific performance is granted as an exception.[262]

The adequacy of damages as a remedy, however, is not without controversy. The question of whether or not damages are adequate is decided by a judge. The criteria of adequacy differs among various judges depending on their preferences. Therefore, whether damages are sufficient compensation is effected to a great extent by a subjective test that gives the judge a discretionary power in assessing the compensation. While this scenario creates uncertainties, this issue was settled to a certain extent after the Hadley v. Baxendale [263] case, which set forth the rule that limits the responsibility of the breaching party to losses that are within reasonable contemplation of the parties.[264]

The reason why damages are the primary remedy is attributed to a concern for freedom of contract. It is thought that a party to a contract should not be forced to perform an obligation if he does not want to. He should have the right to choose between performance and payment of damages. This concern for the freedom of contract makes any obligation rising from the contract changeable to monetary compensation.[265] Under common law, the purpose of remedies is to compensate a party for his loss and when money fulfills this purpose, damages are the sole remedy available. However, damages are not always the adequate remedy.

a. Inadequacy of damages

When damages are insufficient compensation, specific performance is typically granted as an alternate remedy.[266] A contract for sale of land is a standard situation where specific performance is often applied.[267] It is argued that each piece of land has unique characteristics and the loss of a specific piece cannot be compensated by damages since it has a special value [page 42] for the purchaser.[268] This subjective value is respected through granting specific performance.[269] This unique nature of the object of a contract is generally absent in a sale of goods transaction, so damages are considered adequate compensation.[270] Nevertheless, there are other cases that require the granting of specific performance, namely when the goods are unique.

b. Uniqueness

Whenever the object of a contract is unique, specific performance should be granted because damages cannot fully compensate when the object contracted for cannot be purchased from another seller.[271] Another reason that makes uniqueness a case for granting specific performance is that the unique character makes it difficult to assess damages.[272] The unique condition is very closely connected to the condition of adequacy of damages because whenever an object is unique, damages are not adequate compensation.[273]

A good example of a unique good is a work of art.[274] A work of art is considered to be unique and damages are insufficient compensation. In addition, it is difficult to assess damages in such cases because there may not be similar objects in the market to compare the work of art and estimate a value.[275]

Where the goods are neither works of art nor unique in character, the exception does not apply. There is no reason to grant specific performance for goods that are fungible since the buyer can acquire such goods from another party and in turn be compensated adequately with damages.[276] Nevertheless, there may be situations in which the goods contracted for are not unique but it is nonetheless very difficult or costly for the plaintiff to buy [page 43] the goods elsewhere. The difficulty in buying substitute goods gives the goods a character of commercial uniqueness. This was the case in Sky Petroleum Ltd. v. VIP Petroleum Ltd.[277] Petroleum is not a unique good in normal circumstances, but in this case, it became a rare good because there was inadequte supply.[278] The court enforced the performance of the sale of petroleum because of the circumstances surrounding the contract made it a commercially unique good.[279]

Granting specific performance in cases of commercial uniqueness also has a rationale other than remedying the inability to cover. In situations where the good becomes rare, it is not possible to assess the damages because the value of the object cannot be determined in an accurate way.[280] When one cannot measure the amount of damages, it is more prudent to grant specific performance because it is more likely to be fair than awarding damages in such circumstances. The Sky Petroleum Ltd. case is one in which the result achieved can be explained by the difficulty of assessing damages.[281] The granting of specific performance was based on the stated reason of commerial uniquenss, but in reality, it is obvious that the difficulty or even impossibility of assessing the damages was a major factor in determining a remedy.[282] The same reason that the goods were determined to be unique, rarity, is also what made it difficult to assess damages.[283]

Although specific performance was first created as an exceptional remedy, and still has that character, courts have granted specific performance in a wide range of cases whenever principles of fairness required them to do so.[284] This liberalizing approach was also adopted by the legislature and the UCC is an example of that approach.

4. Specific Performance in the Uniform Commercial Code

The UCC was enacted in order to promote uniformity of laws among the states and to adopt rules that keep pace with emerging commercial [page 44] practices.[285] The UCC is supposed to have a liberalizing effect on courts by increasing the bases for courts to grant specific performance as a remedy.[286] This approach is clearly evident by references found in the Official Comment to the UCC.[287]

a. Section 2-716 of the UCC

Specific performance as a remedy in contracts for sale of goods is found in UCC 2-716(1), which states: "Specific performance may be decreed where the goods are unique or in other proper circumstances."[288] This provision deals only with the buyer's right to enforce performance.[289] Using "may" indicates that the party to the contract does not have the right to choose specific performance; it is in the court's discretion to grant specific performance.[290] As mentioned earlier, the discretionary power of a court is characteristic of common law. It was also mentioned in the Uniform Sales Act, which was enacted in the 1920's to regulate contracts for the sale of goods.[291] The scope of this discretionary power is further extended in the UCC by inclusion of the term "other proper circumstances."[292] Here, the legislature has left it to the courts to determine the circumstances in which specific performance would be a proper remedy.[293]

The UCC mentions uniqueness as an example of a situation where specific performance may be granted.[294] The concept of uniqueness is, of course, not new in the UCC, as it is an essential criterion for granting specific performance in common law systems.[295] [page 45]

Court interpretation of the term "unique" has given it broad meaning.[296] Consequently, the UCC adopted this broad meaning, thus rendering the practice more certain and predictable.[297] Goods may be unique in nature, or they may be unique because of surrounding circumstances.[298] Coal was once considered a unique good when it became scarce in the market; and thus, specific performance was the remedy in contract disputes for the sale of this good.[299] Courts also interpret uniqueness based on the circumstances under which the contract shall be performed. Thus, goods that are not intrinsically unique may be considered so for the purposes of enforcing the contract.[300] For example, in 1959, a United States court ordered specific performance of a franchise contract to sell bottled gas because obtaining a franchise in that field was not easily available in the market.[301] Also, in 1946, it was ordered that a contract for the sale of a restaurant and retail liquor business be specifically enforced because obtaining a license for retail liquor business was not easily achievable.[302]

The phrase "other proper circumstances" refers to situations where it is within the court's discretion to grant specific performance based on the facts of the case.[303] These situations are determined on the basis of the difficulty of replacing the goods.[304] This means that "other proper circumstances" [page 46] include situations where it is not easy to find substitute goods in the market and situations where the party asking for specific performance will have difficulty in covering.[305] In fact, because the inability to cover indicates that the goods contracted for were not readily available on the market, the inability to cover was a pre-condition for granting specific performance in earlier drafts of the UCC.[306] In 1948, when cars were in limited production, a contract for the sale of a car was specifically enforced because a similar car was not readily available in the market.[307] As a result of World War II and the ensuing shortage of tobacco, even a contract for the sale of tobacco was specifically enforced.[308] The primacy of the requirement of uniqueness was later replaced by the requirement of inadequacy of damages. Uniqueness became a secondary reason for granting specific performance.[309]

In considering the difficulty of covering as a reason for granting specific performance, U.S. courts have taken two different positions. The minority of courts grant specific performance only when it is impossible to find substitute goods in the market. The majority view is that specific performance should be granted when cover is merely difficult.[310] Situations that render cover difficult are normally situations where the good is scarce.[311] This may occur when there is a shortage or a monopoly. In 1973, when the price of cotton increased greatly, the court ordered specific performance of a contract for the sale of cotton because substitute goods could not be found.[312] Difficulty also includes situations where it is costly to cover.[313] U.S. courts have granted specific performance of contracts for the supply of fuel when the price of fuel drastically rose, making it very costly to cover.[314] [page 47]

The degree to which it is possible to replace the goods is not the only factor that courts take into consideration. The quality of substitute goods is also an issue.[315] It may be possible to find goods of the same kind in the market, but courts have granted specific performance because the quality of the replacement goods was inferior.[316] In such a case, it is unfair to award damages instead of specific performance.[317] This shows that the ability to cover goods that correspond to the buyer's needs is a prequisite to granting specific performance.[318]

b. Criticism of the Provision

The UCC provision on specific performance presents difficulty because the phrase "proper circumstances" does not give a precise description of how and in what situations the provision should be applied.[319] The term is considered vague and unclear.[320] It allows a judge to use the imprecise standard of "proper circumstance" as a pretext for not granting specific performance.[321] The effect of this practice by courts limits the granting of specific performance, thus creating a result contrary to what the drafters of the UCC intended.[322] There has also been criticism as to who is empowered to define "proper circumstances."[323] These two criticisms ignore the fact that the legislators wanted to introduce a liberal approach by leaving it to the courts to determine the proper circumstances for the granting of specific performance.[324] Providing an exhaustive list of situations for granting specific performance would have the effect of limiting, to a great extent, its application as a remedy. In practice, uniqueness and ability to cover are the standards against which "proper circumstances" are judged.[325] By drafting this provision using such broad language, the legislators provided the [page 48] flexibility necessary to judge the constantly changing practices of commercial contracting.[326]

c. Seller's Right to Payment of Price: Section 2-709

In an action for the price, the seller's right to payment of price is governed by section 2-709 of the UCC, which states:

"(1) When the buyer fails to pay the price as it becomes due the seller may recover, together with any incidental damages under the next section, the price

(a) of goods accepted or of conforming goods lost or damaged within a commercially reasonable time after risk of their loss has passed to the buyer; and

(b) of goods identified to the contract if the seller is unable after reasonable effort to resell them at a reasonable price or the circumstances reasonably indicate that such effort will be unavailing."[327]

This section comprehensively enumerates the situations in which a seller is entitled to the price.[328] The seller has the right to receive the price when goods are accepted and received by the buyer, and when goods perish after the risk of loss has passed to the buyer.[329] In the case of goods that are not delivered, the seller can require performance if he is unable to resell the goods after a reasonable effort or when it is indicated from the circumstances that efforts to resell will give no result.[330]

The term specific performance is not used in the provisions regarding the payment of the price.[331] This reflects the fact that payment of price by the buyer is not considered as specific performance in common law systems.[332] It should be noted that the situation is different in civil law, where performance of the obligation to pay the price is exécution en nature.[333] [page 49]

C. Exécution en Nature as the Primary Remedy in Civil law

1. History: Exécution en Nature in Roman Law [334]

The methods of enforcement under Roman law are not similar to today's exécution en nature.[335] Under Roman law, the creditor had the right to imprison his debtor, take him for enslavement and eventually kill him.[336] This form of enforcement was not coerced by the public authorities, rather it was a method left to a creditor's will and represented a sort of self-help by the creditor.[337]

During the classical period, a creditor had the right to monetary compensation. The judgment of damages was entered by the praetor [338] in obligations "to do," or "to refrain from doing." This would be executed on the property of the debtor.[339] No judgments of specific performance were issued and a creditor would only receive damages as a result of the non-performance of the obligation.[340] Later, courts issued orders of seizure, which allowed the chattel that was to be delivered to be seized and handed over to the creditor.[341]

These forms were regulated by Roman law for the enforcement of contractual obligations. An order of the court could be executed only on the property of the debtor.[342] Orders did not provide for any form of physical restraint on the person of the debtor.[343] [page 50]

The notion of exécution en nature emerged during the Middle Ages through the work of the commentators. By making their commentaries on the texts of Roman Law, commentators developed the idea of enforcing a contractual obligation on a debtor.[344] In these commentaries, a distinction was drawn between obligations "to do" or "not to do" and obligations "to give."[345] This distinction, according to Bartolus,[346] who was one of the most important commentators of his time, meant that when the obligation is one "to give," it is possible to enforce its performance. However, when it is an obligation "to do" or "not to do," enforcement is not acceptable because it threatens the personal freedom of the debtor.[347]

This same distinction was adopted later by Pothier,[348] who, in his writings on the law of obligations, had a great influence on the drafters of the French Law of obligations.[349] This reasoning was embodied later in the famous maxim "Nemo potest praecise cogi ad factum," which means that no one can be forced into a specific act.[350] According to Pothier, obligations "to give" may be enforced by seizure.[351] Obligations "to do" or "not to do" may not be enforced, but instead, the plaintiff receives damages (except in certain situations of obligations to refrain).[352] This means that the maxim was rigidly applied in cases of obligations "to do" or "not to do."[353] This notion was adopted by scholars in defending the personal freedom of the debtor from any attack and to protect him in person from violence.[354]

The concern for the personal freedom of the debtor and the desire not to coerce any kind of violence against an individual is reflected in Article 1142 of the French Civil Code, which will be examined later in detail.[page 51]

2. Character of the Remedy

a. Primary

As previously mentioned, a distinction between obligations "to do" or "not to do" and obligations "to give" exists in civil law. The purpose of the distinction is to respect the freedom of a person by not enforcing obligations "to do" or "not to do"when it requires the use of direct coercion on the person of the debtor.[355] In this kind of obligation, the creditor has only a right to damages, but this rule does not make exécution en nature a secondary remedy because of the broad meaning of the term.[356] Exécution en nature not only includes performance by the debtor himself, but also performance received at the expense of the debtor.[357] The range of obligations executable at the expense of the debtor is broad, therefore, exécution en nature is attained in most cases.[358] Thus it became the primary remedy in civil law and a court cannot grant damages when it is possible to perform the contract.[359] Nevertheless, exécution en nature is not so freely available. Its availability is restricted by a number of limitations that ensure its proper application and the protection of the opposing interests of parties.[360]

b. A Right of the Plaintiff

Contrary to the rules of specific performance in common law, where the court has a discretionary power in granting performance, exécution en nature is a right of the plaintiff in civil law systems. Whenever the conditions of granting exécution en nature are met, the court is under a duty to grant it. The court has no discretionary power in the matter.[361] Nevertheless, there may be some circumstances in which the right to receive [page 52] performance is restricted. In judging these circumstances, the court exercises a certain discretionary power.[362]

The first circumstance is the case of impossibility to perform. When it is possible to carry out the obligation, the court enforces performance. But there may be circumstances in which it is impossible to perform the contract.[363] In such cases, the court may refuse to enforce the contract and the plaintiff should instead be awarded damages.[364]

Another restriction on the right to receive specific performance is when it is unconscionable or unfair to carry out the performance of the contract.[365] In awarding any kind of a remedy, a court must weigh the interests of the two parties and grant the remedy that is the fairest for both parties. In the case of exécution en nature, even if the plaintiff has the right to receive performance, the court may refuse to enforce the contract when it will be unfair to do so.[366] Unfairness may arise when enforcement of a contract will result in oppressing the defendant.[367] It also arises when the benefits of enforcing the contract are outweighed by the detriment it causes to the defendant. In such a case, damages may be a more adequate remedy.

Granting performance may be unconscionable when the plaintiff does not have a real interest in performance and damages is sufficient compensation.[368] There is a notion of good faith that should be respected.[369] The [page 53] purpose of this principle is to alleviate hardship on the defendant. Thus, it is similar to common law rules about hardship in specific performance.[370]

The aforementioned limitations still leave room for a court to exercise discretionary power. At the same time, this discretion is narrow since the granting of specific performance is limited to situations where performance is impossible and where it is fair to the promisor.[371]

3. Exécution en nature in the French Civil UCC: Review of Articles 1142-1144 [372]

Among civil law systems, there are differences in rules regarding specific performance. Some have certain techniques of enforcement that are unfamiliar to the others, such as the case of the French Astreinte.[373] The German Civil Code ensures respect for the court's judgment of specific performance by means of fine or imprisonment.[374] Also, there exist different notions and conditions for enforcement, such as good faith.[375] [page 54]

These differences are due to the variances of environment in which each system has evolved. Rules of a country develop according to the general social and political philosophy of the society. Drafters of a civil code adopt solutions that best suit the society. Thus, the law of each country reflects local beliefs and convictions and has a national characteristic.[376]

Nevertheless, there is also a great deal of similarity between civil law systems. The main underlying concepts are the same, and therefore, examining the provisions that regulate exécution en nature in one system can help understand how this institution is organized under civil law in general.[377] The provisions of the French Civil Code are chosen for this purpose because this same system has been adopted by a great number of countries in the world.[378]

a. Article 1142: Substitution of Performance by Damages

This Article states: "[t]oute obligation de faire ou de ne pas faire se résout en dommages et intérèts, en cas d'inexécution de la part du débiteur."[379]

In French law, there is a distinction between obligations "to do" or "not to do" and obligations "to give." Thus, the enforcement of an obligation differs depending on its kind. Enforcing an obligation "to give," which is an obligation to transfer the property, does not give rise to any difficulties. [page 55] When the object is determined, ownership is transferred by the mere conclusion of the contract.[380] As for delivery of the goods contracted for, it may be done through attachment executed by an official designated by the court.[381] Delivery may also take place by forcing the seller to deliver.[382] When the object transferred is not determined, the seller has an obligation to ascertain the goods so that the property may be transferred.

As for obligations "to do" and "not to do," the first is one in which the debtor must perform a positive act or a service other than the transfer of property. The latter is an obligation to refrain from certain acts.[383] Such obligations give rise to some difficulties regarding their enforcement. This can be clarified by examining Article 1142, which specifically deals with these obligations.

A cursory examination of this article may lead one to conclude that a debtor always has the right to choose damages and escape the duty to perform, because the article states that "every obligation to do or not to do resolves itself in damages in case of non-performance."[384] A closer examination of the article reveals the opposite. It makes clear that a creditor has the right to claim performance of the contract and that exécution en nature is the primary remedy in the French system. Reviewing the reasons for the existence of this article is relevant to this examination.

The historical explanation for adopting this article in the French Civil Code is two fold. Before 1789, judges had great power because their positions could be inherited or sold. This situation created an elite group that exercised great control and power over the population. In order to protect the people, this power had to be restricted. This was accomplished by giving the debtor the right to choose between performance or damages and submitting the matter to the discretion of a judge, who might impose harsh conditions on the debtor.[385] The second reason is that notions of freedom [page 56] and liberty proponed by the French Revolution, still fresh in the minds of the drafters of the French Civil Code and Article 1142 were adopted in order to protect this freedom.[386]

The practical reason for this approach is the voluntary character of contracting. Parties to a contract promise to perform certain obligations by their own will. The voluntary quality of obligations in a contract constitutes its main characteristic, as a contract has no real significance if parties are forced into performance. The main role of the contract is to let parties organize their relations the way they think is best for their mutual interests. Also, enforcement requires the use of force and this disturbs the peace in the society.[387] Taking into consideration these concerns, the drafters of the French Civil Code implemented this provision.

Nevertheless, the French code states in another article that a contract is the law that governs the relation between parties.[388] This means that each party should respect the obligations that arise from the contract similar to the manner in which each individual in society has the duty to respect the law. Also, it is important to ensure that parties to a contract receive what they contracted for in order to secure transactions and ensure stability.[389]

As a result of these two opposing considerations, the voluntary character of contracting and the contract being the law of the parties, the general view is that Article 1142 does not give the promisor the absolute right to choose between performance and damages.[390] What the article is intended to do is impede direct enforcement of a promise through the use of force because this will result in violence against the promisor, which is a violation of his right to be secure.[391] Denying the right to enforce is not absolute and it does not apply to all cases in which the obligation is "to do" or "not to do." The denial is restricted to cases where the means of enforcement [page 57] are unacceptable, such as direct enforcement.[392] Earlier in time, imprisonment for civil debts was allowed under the French Civil Code, but in recent times that has become no longer acceptable.[393] In fact, the purpose of Article 1142 is to assert that coercive procedures directed to the person of the debtor are not acceptable.[394]

A coercive procedure is normally required when the act is one that must be performed by the debtor himself. Therefore, such personal acts cannot be enforced.[395] Article 1142, in the view of courts and scholars, does not create a bar to specific performance unless the required act is personal.[396] The promisee has the right to require performance and he is entitled to receive performance without having to show that the non-performance will cause him a detriment.[397]

Therefore, Article 1142 applies only when it is not possible to perform because of the personal character of the obligation that requires the special skills of the debtor. In such a case the performance may only be provided by a specific person, it is impossible to force the debtor, and the only remedy available for the creditor is damages. Obligations that require artistic or intellectual activity fall into this category as well since they cannot be enforced.[398]

It can be concluded that personal acts cannot be enforced because they require direct means of coercion against the debtor. Indirect means, however, are acceptable.[399] Therefore, in any obligation that does not personally involve the debtor, the creditor has the right to exécution en nature. This [page 58] conclusion about the meaning of Article 1142 is reinforced when examining Articles 1143 and 1144.

b. Article 1143: Elimination at the Expense of the Debtor

Article 1143 gives the creditor the right to claim the elimination of what has been done in violation to the contract. The creditor can ask the court for authorization to do so at the expense of the debtor. This kind of enforcement does not constitute an attack on the person of the debtor, and therefore does not contradict with Article 1142.[400] Since Article 1143 can be applied to almost all obligations to refrain, the primary remedy in such obligations is exécution en nature. The language of the article makes it clear that when the creditor asks the court to grant him this remedy, the court cannot refuse to do so.

c. Article 1144: Performance at the Expense of the Debtor

According to Article 1144, the promisee is authorized to receive performance of the promise at the expense of the promisor.[401] Performance may be executed by the promisor himself or by a third party. Of course, this article can be applied only when the cooperation of the debtor is not necessary.[402] Contracts where the personal skills of the promisor are required, such as a contract for a painting, cannot be enforced this way.

After examining Articles 1142 through 1144, it can be concluded that exécution en nature is achievable in all obligations where the skills of or performance by the debtor himself is not required. It is a right of the creditor because it represents the primary remedy in the French system.

4. Specific Performance in Québec Law

After having examined the rules of specific performance in both common law and civil law systems, it is interesting to examine how these two systems are combined under Québec law. The concepts regulating specific performance are borrowed from the French Civil Code while the common [page 59] law influence is clear in the use of injunctions and in the restrictions on granting specific performance.[403]

Articles 1065 and 1066 of the Civil Code of Lower Canada reads as follows:

"Art. 1065. Every obligation renders the debtor liable in damages in case of breach of it on his part. The creditor may, in cases which admit of it, demand also a specific performance of the obligation, and that he be authorized to execute it at the debtor's expense; . . . Art. 1066. The creditor, without prejudice to this claim for damages, may require also, that any thing which has been done in breach of the obligation shall be undone, if the nature of the case will permit; and the court may order this to be effected by its officers, or authorize the injured party to do it, at the expense of the other."[404]

These provisions give the creditor the right to require specific performance unless otherwise prohibied due to the circumstances. They also give the creditor the right to receive performance at the expense of the debtor. These rules are similar to the rules of exécution en nature in the French Civil Code. The same concepts of respecting the debtor's freedom apply here.[405]

On the other hand, the common law injunction is used in enforcing specific performance orders. Injunction is regulated in Article 751 of the Code of Civil Procedure, which permits the use of injunction to force a debtor to perform or refrain from certain acts.[406] This means that injunction can be used to enforce obligations "to do" and "not to do," thus rendering specific performance an available remedy.[407] Nevertheless, common law restrictions are also taken into consideration when ordering specific performance; this is demonstrated in certain judgments where the use of injunction is considered as an exceptional remedy.[408]

Adopting the civil law rules of specific performance while enforcing common law means of enforcement has created a certain conflict in the law [page 60] of Québec. The notion of respecting the person of the debtor by not forcing any direct coercion on him cannot be equated with the harsh sanctions that may result from injunction, such as imprisonment.[409]

The provisions of the Civil Code of Lower Canada were replaced by the rules of the Civil Code of Québec.[410] The new code adopts a freer approach toward specific performance by valuing the importance of promises. Article 1601 of the code states that: "[a] creditor may, in cases which admit of it, demand that the debtor be forced to make specific performance of the obligation." Article 1602 of the CC gives the creditor the right to have the obligation performed at the expense of the debtor.

The general view is that although the new code respects the personal freedom of the debtor by limiting specific performance to the cases which admit of it, it broadens the range of situations in which specific performance can be ordered.[411]

D. The Primary Remedy in the CISG

1. The Primacy of Specific Performance in the CISG

Articles 46 and 62 of the CISG give the right of specific performance to both the buyer and the seller. The drafting of these articles show that specific performance is meant to be the primary remedy in the CISG.

Article 46 deals with different situations of breach, fundamental and non-fundamental, and gives the buyer a right to require performance depending on the type of breach. The buyer can choose between damages and specific performance, without any discretion left to the court. The primacy of specific performance is further confirmed by the provisions of Articles 48 and 49.

Paragraph (1) of Article 48 states that:

"Subject to Article 49, the seller may, even after the delivery date, remedy at his own expense any failure to perform his obligations, if he can do so without unreasonable delay and without causing the buyer unreasonable [page 61] inconvenience or uncertainty of reimbursement by the seller of expenses advanced by the buyer. However, the buyer retains any right to claim damages, as provided for in [the CISG]."[412]

This article provides the seller with the right to cure under certain conditions that secure the buyer's interests. The seller can either remedy the non-conformity or deliver substitute goods.[413] The opportunity to cure saves the contract from being avoided. Thus performance of the contract is more likely to take place with the application of this article.

In Article 49, the buyer is given the right to grant an additional period of time for performance before he declares the contract avoided. In such a case the buyer will not avoid the contract immediately if the seller does not deliver the goods, but will do so only after fixing an additional period of time for performance with which the seller did not comply.[414] This notion of Nachfrist, which is foreign to common law jurists, was borrowed from the German Civil Code.[415]

These methods illustrate that one of the main purposes of the CISG is to prevent avoidance of the contract. Article 46, along with Articles 48 and 49, help circumvent avoidance by preserving the contract as concluded by the parties. Avoidance is limited then to cases in which the non-conformity constitutes a fundamental breach and the seller had the opportunity to cure. These provisions demonstrate the primacy of specific performance in the CISG as a remedy and the preference of specific performance over other remedies, such as damages or avoidance.[416]

A similar rule was followed by the court of appeals in France, which granted avoidance after the buyer of high-tech equipment requested that the seller repair the defects, but the seller did not respond. The buyer [page 62] had the right to avoid the contract because he had given notice of non-conformity, asked for repair and fixed an additional period of time for performance.[417]

2. Assessing the Primacy of Specific Performance

a. Importance of Buyer's Right to Specific Performance in International Sales

The position of specific performance as the primary remedy in the CISG is not surprising. In international sales, the buyer must receive the goods he contracted for because it may not be possible for him to find the required goods elsewhere. A buyer will normally turn to the international market only when he cannot find the goods in his local market or because the goods in his local market are not of good quality. Granting him damages in such cases will not be very helpful since he will not be able to find substitute goods.[418] Additionally, before concluding a contract of sale, a buyer must engage in a thorough search to find goods of a quality and price that conform to his needs and this process requires time and money. The amount of time and money spent increases in an international sale, thus increasing the importance of specific performance as a remedy. When the buyer must find a substitute transaction his only option is to begin a new search. The costs will be exacerbated because the international market provides the buyer a wide choice thus compelling him to do a thorough search in order to find the best prices and the quality. Expenses are multiplied because of the extra cost associated with long distance negotiation and delivery.[419] [page 63]

There are many cases governed by the CISG in which the innocent party has preferred to receive performance.[420] For example, repair was claimed in a case decided by the Court of Appeal of Grenoble.[421] The goods were slightly defective and the seller replaced the defective parts with new parts that were slightly misshapen. The court viewed this as being in conformity with article 46(3) of the CISG.[422] In another case of a contract for the sale of windows, part of the delivery was not in conformity with the contract and the seller sent substitute windows.[423] These cases prove the importance of Article 46 when it is more favorable to perform by repair or by delivery of substitute goods rather than avoiding the contract or claiming damages.[424]

b. Importance of Seller's Right to Specific Performance in International Sales

The seller's right to specific performance is governed by Article 62 of the CISG. The seller may require the performance of any obligation such as payment of price, taking delivery or any other obligation that arises from the contract.[425] In a case decided by a German court, the assignee of the seller's right to payment was entitled to receive the payment in Italian Liras because the contract provided for payment in that currency.[426] The court enforced the buyer's obligation to pay the price in the specified currency according to the parties' agreement.[427]

In another case decided by an arbitral panel of the International Chamber of Commerce, a Bulgarian buyer had not paid the contract price to an Austrian seller within the time period agreed to in the contract.[428] [page 64] Although an additional period of time for performance was fixed by the seller, the panel enforced the performance of the buyer's obligation.[429] The seller has this right without any restrictions, except that he may not resort to an inconsistent remedy. The seller may force the buyer to take delivery of goods without having to prove that he was unable to resell the goods.[430]

c. Importance of Specific Performance for Developing Countries

All the aforementioned difficulties are of increased significance for buyers in developing countries. Access to other markets is normally difficult for someone doing business in a developing country.[431] Specifically, access is hindered by the underdeveloped yet costly methods of communication, which in turn raises the cost of locating a seller. Additionally, government regulations tend to be severely restrictive in certain countries (for no other reason but to ensure tight control over citizens).[432] In those countries, as result of the weak economic situation and the governments' desire to ensure its control by limiting access to other parts of the world, modern means of communication have not been introduced in the local business practice.[433] The costs of locating a seller and negotiating a deal are higher than what a buyer from a developed countries would bear.

It would be unfair, after dealing with high costs and difficulties, to make a buyer from a developing country negotiate for a substitute deal. Moreover, damages as a remedy will surely not cover all the additional costs, especially when judges, unaware of the market conditions, do not consider all these special factors. In such circumstances, specific performance is the only adequate remedy.

Even when the buyer attempts to reduce his costs by seeking a substitute deal in his local market, or the neighboring markets, he will face another problem - the non-availability of the goods. Markets of the developing countries do not have the same variety of goods as developed [page 65] countries.[434] Indeed, certain goods are not at all available. A buyer from a developed country does not have these same concerns about the inability to find substitute goods: if he cannot get specific performance, damages is adequate compensation.[435] The goods can be assessed and damages granted.

Conversely, in a developing country, monetary compensation may be an inadequate substitute because the flow of goods is limited in these markets.[436] This is especially true for certain goods that require a highly skilled individual to manufacture, such as highly technical equipment.[437] Since developed countries specialize in skill-intensive products and developing countries in labor-intensive products, a contract of sale between a buyer from a developing country and a seller from a developed country will normally include skill-intensive goods that are not available in the buyer's market. When deciding a case where these conditions apply, a judge should keep in mind that damages may be inadequate.

In addition to these economic factors, a buyer may be faced with burdensome government regulations. Import restrictions may include barriers to imports originating from certain countries, or there may be high tariffs imposed on these imports. A buyer must take into consideration these factors when choosing the market from which he wants to buy. These restrictions will limit the range of choices available. There also may be restrictions on transfer of payments. Paying for the imported goods may raise certain difficulties when there are strict rules regarding the transfer of money.

When a buyer takes into consideration all these aforementioned regulations and restrictions, he must spend time and money to finally conclude a contract. Therefore, a buyer from a developing country is apt to value specific performance much more than a buyer from a developed country. He may view specific performance as the only compensatory remedy.

As for repair, which is one form of specific performance provided for in the CISG, it also has a greater importance for developing countries. When the goods must be repaired, the buyer may not be able to find the necessary expertise in his own country. His only recourse, then, is in the international market; therefore, having the seller do the repair is essential for [page 66] the buyer. It will save him the trouble and expense of looking for experts in other markets.

In regard to the seller's right to specific performance, forcing the buyer to take delivery of the goods is important to the seller when it is difficult for him to find a substitute transaction. These difficulties may be more significant with sellers from developing countries because they do not have easy access to the international market. Communication and transportation being less developed and more costly, a seller from a developing country will have much difficulty in finding a substitute deal, especially when the goods have arrived to the destination port and the buyer refuses to take delivery. The seller may not have the necessary information about that market, and therefore will have immense trouble finding a new buyer. If he cannot find a buyer in that market he will have to transport the goods back to his own country or to another market, which will multiply the costs of the transaction. Denial of specific performance in such a case will cause hardship to the seller. On the other hand, as mentioned earlier, it may be unfair to force the buyer into performing the contract when the conditions of the market have changed in a way that renders the contract unprofitable.

3. Application of the Rule

a. Interpretation

The application of an international convention in domestic courts raises certain issues regarding interpretation.[438] It is more difficult for a judge to apply an international convention than to apply domestic legislation because the meaning of the terms used in domestic law are well established and known, unlike an international convention.[439] Therefore, the issue of interpretation is crucial for the proper application of the CISG.

In order to understand the exact meaning of a term, the intentions of the drafters must be taken into consideration. This can be achieved by reviewing preparatory material and deliberations that led to the adoption of the CISG. It may also be helpful or perhaps even necessary, in order to reach the same results in practice, to consult foreign case law.[440] But this may be [page 67] difficult, as access to foreign case law is often difficult.[441] In addition to understanding the meaning of a term, another difficulty is ensuring uniformity of application.[442] Consultation of foreign decisions also helps achieve this purpose.[443]

The CISG is no exception to these rules. In fact, uniform interpretation and application is a necessity under the CISG. A convention that has as its purpose the unification of private law, requires uniform application in all member states.[444] The issue of determining the precise meaning of a term was examined earlier in this article with the term specific performance. It became clear that determining the meaning of a term in the CISG is not an easy task because of the different connotations it may have in different legal systems.

The meaning of the term specific performance in domestic law systems is different from its meaning in the CISG.[445] Therefore, when applying the CISG, the domestic connotation of the term should not be the basis for a court's judgment; a court should apply the meaning of the term as intended under the CISG so as to avoid conflicting applications of the rule. Even when terms are understood in the same manner, uniform application requires a uniform interpretation. This issue is significant for the CISG, which promotes uniformity in the international sale of goods. Thus, the drafters of the CISG included certain provisions that specifically address uniform interpretation.[446]

Paragraph (1) of Article 7 reads as follows: "In the interpretation of this Convention, regard is to be had to its international character and to the need to promote uniformity in its application and the observance of good faith in international trade."[447] The importance considering the international character was previously discussed in this paper in relation to the term specific performance. The observance of good faith is viewed by some scholars as being necessary not only when interpreting the CISG but also in [page 68] the relations between contracting parties.[448] Good faith is often mentioned in domestic law as well, although it may have different meanings and varying degrees of importance, depending on the system.

In civil law systems, parties are required to observe good faith during both the negotiation and performance of the contract as well as in its interpretation.[449] Under common law systems, the duty to respect good faith is imposed only in the performance of the contract.[450] This divergence in approach rendered the issue one of much debate during the negotiations of the CISG.[451] The result of this debate was the inclusion of Article 7, which advises that the CISG should be interpreted in accordance with principles of good faith in international trade. In this context, the meaning of good faith is determined according to the needs of international trade and not according to the meaning of good faith under national laws.[452]

In a case illustrative of the meaning of good faith in the international context, a French seller and an American buyer agreed that the goods purchased should be sent to South America and Africa.[453] Later, the seller discovered that they had been sent to Spain.[454] The seller refused to continue the relationship and the court found that the conduct of the buyer was contrary to principles of good faith in international trade.[455]

Good faith should be taken into consideration when determining whether to grant specific performance. A party may seek to enforce this remedy not because it is the only adequate remedy, but to impose an extra [page 69] burden on the other party, thus, causing hardship and abusing the remedy.[456] The concern for avoiding hardship to a party is clear in Article 46.[457] Requiring substitute goods is only permitted when the breach is fundamental, and the right to a substitute can only be claimed within a reasonable period of time, therefore, the buyer cannot avoid a contract out of bad faith or because he has found a better deal.[458] Also, in paragraph (3), repair cannot be claimed unless it is reasonable to do so.[459] When forcing repair imposes hardship on the seller, the judge should not grant it.[460] In one case, the court found the buyer's claim for specifice performance unreasonable to enforce because it would have multiplied the value of some of the elements sold by a factor of forty.[461] This would have caused hardship, and therefore, the court found that replacing the defective goods with slightly imperfect goods was satisfactory performance.[462]

The good faith issue applies in both cases of granting and not granting specific performance.[463] It should be granted when a party is trying to escape his obligations by paying damages because he is longer any interested in the contract, and paying damages is more profitable than performance because of changes in market conditions.[464] On the other hand, a party may claim specific performance out of bad faith.[465] It is the duty of the judge to examine whether or not good faith exists.[466] This may not be easy because a judge cannot always reveal the true intentions of party. Nevertheless, the circumstances surrounding the transaction must be examined.

The notion of good faith is related to the efficient breach theory, which permits a party to breach a contract when it is more economically efficient [page 70] to do so and when it does not harm the other party.[467] However, if one accepts that a court should not grant specific performance when there is bad faith on the part of one party, efficient breaches should also be denied in similar circumstances.[468] Whether specific performance is less efficient than damages has long been an issue of debate in the common law.[469] No clear answer emerges, as scholars have convincing reasons for both of these divergent opinions.[470]

Some view specific performance as adequate compenstation because it respects the subjective value that a party puts on the contract, while others consider damages sufficient compensation [471] as damages permit a party to buy substitute goods that conform to his needs. An example of this is the case of a buyer of compressors for air conditioners who received defective goods and, after trying to cure it himself (which he was not able to), he asked for damages and bought substitute goods elsewhere.[472] In this case, it was apparently more efficient for him to claim damages.[473]

Since the issue is unsettled, however, it is left to judges to decide whether specific performance is more efficient. This assessment cannot [page 71] exclude the good faith requirement that is implemented in the CISG. Thus, the task becomes even more difficult.

In a case decided by an arbitral tribunal, there was a contract between a Russian firm as seller and a group of companies as buyers.[474] The contract concluded was for delivery of multiple installments of raw aluminum with a period of performance that extended over several years.[475] When the seller was privatized, the new owner stopped delivery of the goods, and the buyer sued for specific performance.[476] In installment type contracts, such as this one, a buyer may prefer to receive performance because he will be unable to find a substitute transaction.[477] Nevertheless, in this case, the claim was rejected and damages were awarded as result of the difficulty of enforcing such a claim.[478] Specific performance in this case would require constant supervision by the court over several years, and the court found it impossible to enforce an award of specific performance under the circumstances in Russia. This case shows that when granting the proper remedy, issues of enforcement difficulties play a role in the court's decision.[479]

In another case,[480] a Swiss buyer placed an order with an Italian seller that included a request that the goods be delivered within ten to fifteen days of the execution of the contract.[481] The seller, after asking the buyer to confirm its order, specified the purchase price and assured the buyer that all the goods would be dispatched within a week.[482] Two months later, the buyer had not yet received the goods.[483] Consequently, the buyer sent the seller a notice canceling the order and requesting refund of the price. After waiting for an additional two months, the buyer sought avoidance, which the court granted.[484] [page 72]

These cases show that many factors are involved when deciding the proper remedy.[485] There are certain factors that courts consider when granting a remedy. There are also other factors that business-people take into consideration when claiming a remedy.

The main concern of a business-person is profit. And when it is more profitable for him to receive specific performance, he will ask for it. Sometimes it is to the advantage of the innocent party to claim damages when it is possible to find substitute goods because it may be faster to resolve the dispute. Another reason for preferring damages is that the non-breaching party has lost confidence in the other party. An innocent party may no longer want the other party to perform because he can no longer trust the quality of the performance. The length of the relationship between the parties also affects the decision.

The factors that affect a decision to breach include both economic gain and the concern for maintaining a good reputation. A party may try his best to preserve a deal out of concern for his reputation. Pre-determined rules regarding these matters cannot be reached, but instead, the issue must be examined on a case-by-case basis. It is perhaps reasonable to let the parties choose the remedy that satisfies them best because they best know their mutual needs. This, however, may create room for bad faith practice by certain parties.[486]

b. Article 28 and Uniformity

As mentioned above, the scope of Articles 46 and 62 is limited to a great extent by Article 28, which makes the granting of specific performance subject to the laws of the forum.[487] Article 28 was introduced so that common law countries would not have to make changes in their rules about specific performance. This article is criticized as constituting a threat to uniformity. It is not clear whether this assumption is entirely true because [page 73] it can be argued that the results reached under common law rules are similar to the results reached in civil law.

The UCC, as an example, limits specific performance to situations where the goods are unique or when there are other proper circumstances. It may be difficult to find uniqueness in the sales governed by the CISG but it may not be hard to find "other proper circumstances." As mentioned earlier, when discussing these provisions, courts grant specific performance in circumstances where it is difficult to find substitute goods. They also grant it when it is costly to cover or when the substitute goods are not of the same quality.[488] These conditions often apply to international sales since a buyer will have great difficulty in trying to replace goods in a foreign market because he may not find an adequate substitute or the substitute goods may be of a poor quality. Replacement of goods under these conditions requires additional effort and money. In such situations, a common law court will be inclined to grant specific performance because it would have done so in domestic contracts.

The notion of commercial uniqueness may apply in international sales. Some goods may only be found in certain countries, making them commercially unique and rendering specific performance the adequate remedy. This is especially true for developing countries and planned economies, where the choice of goods is very limited and many goods are scarce or even non-existent in the local market or in the markets to which the buyer has access.[489]

One may argue also that the restrictions on granting specific performance in both common law and civil law systems are based on concerns for personal freedom.[490] Specific performance is not granted when it involves the person of the promisor. This is, however, not the case in contracts for the sale of goods, as neither the buyer's freedom nor the seller's freedom is threatened. Therefore, this rationale for not granting specific performance does not exist in the sphere of the CISG.[page 74]

Another reason for not granting specific performance is the perceived inefficiency of the remedy. It is argued - especially in common law countries - that damages are more efficient because in some cases it is better to breach the contract than to complete it.[491] This issue has not been resolved, but instead is left to courts to decide on a case-by-case basis. It may be possible that neither the buyer nor the seller will claim specific performance when it is not economically efficient to do so. This means that remedies granted in both systems will be similar when the circumstances surrounding the contracts are the same. Therefore, the result of a litigation does not depend on the rules of the forum as much as it does on the conditions in which the contract is being carried out.

In light of these arguments and contrary to popular opinion, Article 28 is not a threat to uniform application of the CISG. There is room for courts to apply uniform rules within the sphere of the CISG because the rules of common law systems allow this flexibility in the courts. The CISG even broadens the scope of specific performance in common law countries because it gives a court the choice between applying the provisions of the CISG, which provide for specific performance freely, or applying its domestic law, which may not be as liberal in granting this remedy.[492]

Nevertheless, the aforementioned arguments do not give adequate assurance that uniformity will be achieved. Even though common law courts have the flexibility to freely grant specific performance under domestic laws, this does not guarantee uniform application of the CISG. Uniform application depends on how the courts interpret the domestic law. Assessing whether proper circumstances exist and whether it is more efficient to grant specific performance is left entirely to the court. This situation threatens uniformity to a great extent.[493] When individual courts have sole authority to judge a case, without having to conform to more fixed rules, it is hard to imagine that uniformity can be achieved.

When courts have the flexibility to apply the CISG in different ways, there is a great likelihood that divergent practices will occur. In Delchi Carrier S.P.A. v. Rotorex Corp.,[494] a case judged by a United States court, specific performance was not enforced. Damages were awarded instead, according [page 75] to the plaintiff's demand.[495] Conversely, a German court, of civil law tradition, found that the buyer had the duty to fix an additional period of time for delivery with which he did not comply.[496] Therefore, the buyer could not avoid the contract and had to pay the price.[497] The goods in this case were fabrics, which were fungible goods, but the court examined first the likelihood for requiring performance through fixing an additional period of time. The German court preferred enforcing performance. Although in doing so, it erred in interpreting the CISG, because fixing an additional time for performance is not a duty of the buyer. These two cases show how the CISG is applied differently by courts depending on their national systems.

The CISG, which tries to reconcile different approaches does so by means of sacrificing the goal of uniformity. When delegates from different countries negotiate a unifying convention, their efforts should be oriented to achieving uniformity and this can be done only when the rules adopted apply without exceptions to all participating countries. It is rather disappointing to see that after extensive deliberation and negotiation and after so many years (CISG being preceded by ULIS and ULF) the solution was to add Article 28. This resulted in maintaining the divergent approaches. Any uniform application of the rules of specific performance was thus defeated.

It is perhaps necessary that negotiators of this convention adopt a more ambitious solution. The fear of offending any given party results in the drafting rules that do not give fixed and determined answers and leave the achievement of uniformity to domestic courts. This situation not only hinders uniformity but creates even more uncertainty, as the result of the litigation varies depending on which country has jurisdiction.

CHAPTER THREE: Conclusions

The importance of unified rules in the field of international contracts for the sale of goods is now widely recognized. Conventions for the unification of rules of private law create more certainty and facilitate trade. Domestic rules are created in order to govern internal relations. However, they [page 76] are not suitable for regulating international contracts, and therefore, a body of rules that is created with the consent and participation of many countries is more suitable in that role. Also, in some countries, the legal system is not sufficiently developed to organize trade and commerce on the international level. Therefore, the CISG plays a crucial role in the international sale of goods.

The difficulty in reaching consensus was demonstrated in Article 28, and the important differences between common law and civil law were discussed during debates on specific performance. Enormous efforts were made to narrow the gap between different legal systems. Unification was reached in many matters, but it was not entirely attained in all issues governed by the CISG.

Whenever major differences in the views of delegates arose, the solution was to adopt a rule that is a mixture of different approaches. This compromise was done by adding exceptions to various rules. The reason for this was the drafters' desire to consolidate the different views without forcing any party to sacrifice his own rules. While there is a perception that the CISG achieves uniformity of rules, closer examination reveals that the concern to satisfy all parties by incorporating the rules of each system prevailed over the concern for creating fixed and certain rules. Rarely did the Contracting States make major compromises. The conflict of rules between North-South, East-West and common law / civil law was surmounted by adopting a rule of one system and adding exceptions derived from other systems. This may seem a satisfactory solution, but it does not help the CISG achieve its purpose of creating uniform rules and certainty. Instead, the outcome of these rules is uncertain because the result of a litigation still greatly depends on the rules of the forum.

These shortcomings of the CISG are especially clear in the case of specific performance. The difference between common law and civil law in this matter is so vast as to make compromise the only way to deal with this matter. This is reflected in the adoption of Article 28. It is hard to imagine that uniformity can be achieved when it is left to individual domestic courts. The purpose of an international convention is to decide rules that apply to all parties without giving discretion to domestic courts, but this is not the case of the specific performance rules in the CISG.

Different means of achieving uniform application of the CISG have been suggested by scholars, such as the creation of an administrative body charged with supervising decisions of courts applying the CISG. Another suggestion is to publish decisions of courts in different countries. The first [page 77] proposal is not achievable because it interferes with a country's sovereignty. The second suggestion may be helpful, but it does not ensure uniformity because it would only give guidance to courts without ensuring any uniform practices.

An efficient solution is to review the provisions that do not provide fixed rules and try to adopt more definate provisions. Delegates should be willing to give concessions in negotiations of such scope. While it is true that the CISG creates some certainty, unification has not been fully achieved in regard to all issues regulated by the CISG, and specific performance is an example.

The uncertainty about specific performance may be eliminated in the future if delegates, recognizing a need for change, reconvene to address problem issues in the CISG. The addressing of problem issues will not come easy, however, as such a task requires an intensive study of the application of the CISG and a thorough analysis of cases that were judged according to the CISG's current rules. When this is accomlished, only then will it be possible to determine whether the rule on specific performance must be changed to eliminate the choice provided to common law countries in Article 28.

This is not a suggestion to adopt rigid rules because, as demonstrated in this article, countries have different economic situations and a certain remedy may be more adequate than another depending on where the contracting party is carrying out his business. The suggestion is to adopt a fixed and clear criteria that permit derogation from the rule. The criteria must be based on a country's needs and economic conditions, not on the basis that certain rules inherited from the past should never be challenged.


FOOTNOTES

* First, I would like to thank my supervisor, Daniel Jutras, for all the help and guidance he offered me. He always had time for me, and I learned a great deal from his ideas and suggestions. I am also grateful to Albert Kritzer, the Executive Secretary, Institute of International Commercial Law, Pace University School of Law, for his comments. They were of a great value to me. I would like to express my gratitude to Shervin Majlessi for his support and his help in editing this article. Finally, I would like to thank the staff of the Law Library at McGill University for their cooperation and assistance.

1. Although legal and economic systems differ from one country to another, common rules exist in the field of international commerce. The reason for this is that businessmen use the same techniques when carrying out international transactions no matter which country they come from. This is achieved as a result of the freedom of parties to stipulate the terms they want in their contracts. These rules are based on trade usage, and they are considered as the new lex mercatoria. When one recognizes the existence of such rules, the role of unification becomes less significant and some scholars question the necessity of unification. For further discussion of this view see R.H. Graveson, The International Unification of Law, 16 Am. J.Comp. L. 4 (1968). Nevertheless, the role that unification plays is important because the rules developed through the practice of business people may not be known in countries that have entered the international trade field only recently, such as eastern bloc and developing countries. Furthermore, unified rules are more certain because they receive full recognition from national legislators. Unified rules and the lex mercatoria can complement each other. See H.J. Berman & C. Kaufman, The Law of International Commercial Transactions (Lex Mercatoria) 19 Harv. Int'l. L. J. 221, 275-277.

2. United Nations Convention on Contracts for the International Sale of Goods, Apr. 11, 1980, U.N. Doc. A/CONF. 97/18, Annex I, reprinted in 19 I.L.M. 671 (1980) [hereinafter CISG].

3. Id.

4. See S.G. Zwart, The New International Law of Sales: A Marriage Between Socialist, Third World, Common, and Civil law Principles, 13 N.C. J. Int'l L. & Com. Reg., 118, 121 (1988).

5. Compare the French Civil Code, C. civ. 1142-44 (1804) and the Amercian Uniform Commercial Code, U.C.C 2-716 (1977).

6. C. civ. 1142-44.

7. U.C.C. 2-716.

8. The French Civil Code is chosen in this study because it was adopted by a great number of countries in the world, as was the American Uniform Commerical Code.

9. See Jack G. Stern, A Practitioner's Guide to the United Nations Convention on Contracts for the International Sale of Goods, 16 N.Y.U. J.Int'l L. & Pol. 81 (1983).

10. See Survey of the International Sale of Goods 3 (L. Lafili, et al. eds., 1986) [hereinafter Survey].

11. See Alejandro M. Garro, Reconciliation of Legal Traditions in the UN Convention on Contracts for the International Sale of Goods, 23 Int. Law . 443, 480 (1989).

12. See id.

13. See id.

14. Uniform Law on the International Sale of Goods (1964), reprinted in 3 I.L.M. 855 (1964) [hereinafter ULIS].

15. Convention Relating to a Uniform Law on the Formation of Contract for the International Sale of Goods, July 1, 1964, 834 U.N.T.S. 107, 169 (1964) reprinted in 3 I.L.M. 854 (1964) [hereinafter ULF]; Peter Schlechtriem, Uniform Sales Law: The UN-Convention on Contracts for the International Sale of Goods 17 (1986).

16. Twenty-two of the twenty-seven signatories were European countries. Developing and socialist countries were not represented and therefore the ULIS and ULF did not receive any acceptance from these countries. See Garro, supra note 11, at 450.

17. See John Honnold, Uniform Law for International Sales Under the 1980 United Nations Convention 5 (2nd ed. 1991).

18. This Commission is a representative body with delegates of thirty-six states from all regions of the world. See Franco Ferrari, Uniform Interpretation of the 190 Uniform Sales Law, 24 Ga. J. Int'l. & Comp. L. 183, 195 (1994).

19. See Ferrari, supra note 18, at 188.

20. See id.

21. See id.

22. See id.

23. See id.

24. See Garro, supra note 11, at 447.

25. Twenty-one countries signed the CISG by its deadline, September 30, 1981. The CISG entered into force on January 1, 1988. See International Sale of Goods, in Dubrovnik Lectures 2-6 (P. Volken & P. Sarcevic eds. 1986).

26. See Garro, supra note 11, at 480.

27. See Ferrari, supra note 18, at 193.

28. See id.

29. See A. Kaczorowska, International Trade Conventions and Their Effectiveness: Present and Future 9 (1995).

30. See Garro, supra note 11, at 451.

31. See id.

32. This method was viewed by civil law delegates as being the common law approach of finding solutions on a case-by-case basis rather than formulating pre-determined rules and then applying them to cases. See A.H. Kastely, The Right to Require Performance in International Sales: Towards an International Interpretation of the Vienna Convention, 64 Wash. L. Rev. 607, 609 (1988).

33. See generally Gyula Eörsi, A Propos the 1980 Vienna Convention on Contracts for International Sale of Goods, 31 Am. J. Comp. L. 333 (1983).

34. The CISG does not adopt the division of contracts into commercial and non-commercial, as is the case in civil law systems.

35. This matter did not raise real controversy because contracts of sale are not gratuitous in any case. Also, the issue of the validity of a contract is not covered by the CISG.

36. In civil law, an acceptance does not produce its effects until it reaches the other party; while in common law, acceptance produces its effect upon dispatch when it is sent by post and not by instantaneous means of communication.

37. In most civil law jurisdictions, an offer cannot be revoked for a reasonable period of time unless the offeror indicates the opposite. This is not the case in common law, where the offeror can revoke the offer until the contract is concluded. For further discussion of the binding force of an offer in different legal systems and the compromise solution reached in the CISG, see S. Malik, Offer: Revocable or Irrevocable. Will Art. 16 of The CISG on Contracts for the International Sale Ensure Uniformity?, 25 Ind. J. Int'l L. 26 (1985).

38. See Garro, supra note 11, at 456.

39. See Zwart, supra note 4, at 121.

40. See id.

41. See id.

42. See id.

43. J.D. Feltham, The United Nations Convention on Contracts for the International Sale of Goods, J. Bus. L. 346, 350 (1981); See generally S. Bainbridge, Trade Usage in International Sale of Goods: An Analysis of the 1964 and 1980 Sales Conventions, 24 Va. J. Int'l L. 619 (1984).

44. See id.

45. See id.

46. See Zwart, supra note 4, at 118.

47. See id.

48. See id.

49. The open-price rule is permitted except where contrary to an applicable domestic validity rule. See Albert H. Kritzer, Guide to Practical Applications of the United Nations Convention on Contracts for the International Sale of Goods 157-59 (1989).

50. See Garro, supra note 11, at 447.

51. See Feltham, supra note 43, at 350 and Bainbridge, supra note 43, at 619.

52. See Garro, supra note 11, at 459.

53. See id.

54. See id.

55. See id. at 352.

56. Price, payment, place and time of delivery are examples of issues that are material.

57. Developing countries export mainly raw material and agricultural products, and they import technology and finished goods. See Garro, supra note 11, at 468.

58. See id.

59. See id.

60. See id.

61. See id.

62. Developing countries import complex machinery, and therefore, it may be difficult for a buyer from a developing country to discover the defects of the product. Additionally, they usually need help from foreign experts to test the machinery, which may add to the delay. See Garro, supra note 11, at 468.

63. See id at 469-76; See also G.S Brussel, The 1980 United Nations Convention on Contracts for the International Sale of Goods: A Legislative Study of the North-South Debates, 6 N.Y. Int'l L. Rev. 53, 65-68 (1993); See generally M.G. Strub, The CISG on International Sale of Goods; Anticipatory Repudiation Provision and Developing Countries, 38 Int'l & Comp. L. Q. 475 (1989).

64. Developing countries worry that a party from a developed country might abuse its stronger position to modify the terms of the contract by requiring assurance of performance from the other party, a requirement that would raise the costs of performance. See Garro, supra note 11, at 469-76; See also Brussel, supra note 63, at 65-68 and Strub, supra note 63, at 475.

65. See Garro, supra note 11, at 477.

66. See id.

67. See id.

68. See id. at 481.

69. See id.

70. See Dubrovnic Lectures, supra note 25, at 7.

71. The CISG combined the rules regarding the formation of contracts and rules of duties of parties which were separated formerly in the two texts of ULIS and ULF. See Ferrari,supra note 18, at 195.

72. Contracts for the sale of goods for personal, family or household use are not governed by the CISG. Also contracts of services are not included. Certain issues are also excluded from the scope of the CISG such as validity of the contract and the liability of the seller for death or personal injury caused by the goods. See CISG, supra note 2, art. (2)(a).

73. See id.at art. 1; Survey, supra note 10, at 10.

74. See CISG, supra note 2, art. 6; Schlechtriem, supra note 15, at 24.

75. See CISG, supra note 2, arts. 14-17 (for the rules regarding offer).

76. See id.at arts. 18-24 (for the rules regarding acceptance). Schlechtriem, supra note 15, at 48-56; see generally Stern, supra note 9, at 81.

77. See Feltham, supra note 43, at 350.

78. See CISG, supra note 2, at arts. 45-65.

79. See id. at arts. 25-88; Honnold, supra note 17, at 62-66.

80. See CISG, supra note 2, at art. 30; Feltham, supra note 43, at 353.

81. See CISG, supra note 2, at art. 53.

82. See Survey, supra note 10, at 14.

83. For remedies available to a buyer, see CISG, supra note 2, at art. 45. For the remedies available to a seller, see id. at art. 61; W. Mapp & C. Nicoll, The Vienna Convention on International Sale of Goods: Obligations under the contract and remedies forbreach N.Z.L.J. 316, 318-19 (1993).

84. Rendering specific performance as a right of both the seller and the buyer reflects the civil law aspect while the section regarding damages is based on common law rules. See Garro, supra note 11, at 459.

85. Reduction of price is an example of remedies foreign to common law. See Zwart, supra note 4, at 118.

86. See Survey, supra note 10, at 14.

87. See Zwart, supra note 4, at 118.

88. See generally O. Gonzalez, International Sales Convention Remedies, 2 Int'l Tax & Bus. Law. 79 (1984).

89. See id.

90. See id.

91. See Feltham, supra note 43, at 356.

92. See id.; see also Mapp & Nicoll, supra note 83, at 319.

93. See CISG, supra note 2, at arts. 71-88; Honnold, supra note 17, at 483-553.

94. See Dubrovnic, supra note 25, at 241.

95. See Feltham, supra note 43, at 358.

96. See Schlechtriem, supra note 15, at 97.

97. See id.

98. See id.

99. The buyer may do this through the purchase of goods from a third party and the seller by reselling the goods rejected by the buyer. See id.

100. See CISG, supra note 2, at art. 78; Feltham, supra note 43, at 359.

101. CISG, supra note 2, at art. 79.

102. See id.at art. 92.

103. See Schlechtriem, supra note 15, at 111-13.

104. See CISG, supra note 2, arts. 46, 62.

105. See id.

106. See Zwart, supra note 4, at 118.

107. See CISG, supra note 2, at art. 28.

108. See Zwart, supra note 4, at 118.

109. See Gonzalez, supra note 88, at 96-97.

110. CISG, supra note 2, at art. 46.

111. See id.

112. A buyer can choose between damages and specific performance, and he does not have to prove that he is unable to buy substitute goods in order to receive performance. See id. at art. 28.

113. See id. at art. 47(1).

114. See id. at art. 72(2).

115. See id. at art. 51(2).

116. See Paul Schlechtriem, Commentary on the UN Convention on the International Sale of Goods (CISG) 376 (2nd ed. 1988).

117. This limitation to the right to specific performance is an explicit one. There is also an implicit limitation which is the good faith requirement. Specific performance will not be granted when the buyer has asked for it in bad faith in order to cause hardship to the seller. See Kastley, supra note 32, at 616.

118. See Honnold, supra note 17, at 282.

119. See J.M. Catalano, More Fiction than Fact: The Perceived Differences in the Application of Specific Performance under the United Nations Convention on Contracts for the International Sale of Goods, 71 Tul. L. Rev. 1807 (1997).

120. See Kastely, supra note 32, at 613.

121. Goods are not in conformity when they are defective, when they do not have the qualities required by the contract, or when they are of a type different from that which is described in the contract. See Garro, supra note 11, at 468.

122. Breach is considered fundamental when the dissimilarity between the goods tendered and the terms of the contract is of an important degree when judged objectively. See J. Fitzgerald, Recent Development Relating to CISG: CISG, Specific Performance, and the Civil law of Louisiana and Quebec, 16 J.L. & Com. 291(1997).

123. The buyer cannot claim delivery of substitute goods unless he is able to return the goods delivered to the seller. See Schlechtriem, supra note 116, at 381-82.

124. See id. at 377.

125. See CISG, supra note 2, at art. 46.

126. See Catalano, supra note 119, at 1811.

127. See Kastely, supra note 32, at 616.

128. See id.

129. See id.

130. See Schlechtriem, supra note 116, at 377.

131. See id.

132. See id.

133. See id.

134. See Honnold, supra note 17, at 364.

135. See id.

136. See id.

137. The time limit for giving a notice is explained in Art. 39 of the CISG. The notice should be given within a reasonable time after the buyer has discovered the non-conformity or ought to have discovered it. In any case, the notice should be given within two years at the latest from the date in which the goods were handed to the buyer, unless the goods were guaranteed for a different period of time. See CISG supra note 2, at art. 39.

138. See Schlechtriem, supra note 7, at 76.

139. See CISG, supra note 2, at art. 46.

140. During the negotiations, several delegates supported the remedy of specific performance. The French delegate considered enforcing the contract as the essential remedy. The Belgian delegate went even further by considering specific performance as the foundation of the CISG.

141. Delegates believed that law should not force a non-breaching party to accept anything less than performance.

142. See Kastely, supra note 32, at 639.

143. See id.

144. See id.

145. See id.

146. See id. at 614-15.

147. See T. J. Muris, The Costs of Freely Granting Specific Performance, Duke L.J. 1053 (1982).

148. See Catalano, supra note 119, at 614.

149. In similar situations, granting damages is considered to be more efficient. Damages permit the buyer to procure the goods elsewhere and receive compensation by the seller.

150. See Kastley, supra note 32, at 614

151. See id.

152. See CISG, supra note 2, at art. 62

153. Compare id. at arts. 46 and 62.

154. Id. at art. 62.

155. See Honnold, supra note 17, at 434.

156. See Kastely, supra note 32, at 614-15

157. See id.

158. See id.

159. Compare CISG, supra note 2, at arts. 46 and 62.

160. See id. at art. 62.

161. See Fitzgerald, supra note 122, at 5. See also Catalano, supra note 119, at 1810.

162. This rule is also found in the U.C.C. See Fitzgerald, supra note 122, at 293.

163. See Honnold, supra note 17, at 434-36; Kritzer, supra note 49, at 419.

164. See Fitzgerald, supra note 122, at 295.

165. See id.

166. See Fitzgerald, supra note 122, at 105.

167. See S. Walt, For Specific Performance Under the United Nations Sales Convention, 26 Tex Int'l L. J. 211, 218 (1991).

168. See id.

169. See CISG, supra note 2, at arts. 46 & 62.

170. See Muris, supra note 147, at 1065.

171. See Schlechtriem, supra note 116, at 200.

172. See Garro, supra note 11, at 458-59.

173. See id.

174. In the 1978 Draft, it was provided that a court could not grant specific performance unless it "could" under its own law. This language made a court obliged to render specific performance whenever its domestic law gave the court the discretion to do so in domestic contracts. The United Kingdom objected to this language because it would oblige a court to grant specific performance in many cases while the court would only do so in few cases. Therefore, the United Kingdom proposed changing "could" to "would" thus creating more flexibility for the courts not to grant specific performance. See Kastely, supra note 32, at 626.

175. See Fitzgerald, supra note 122, at 7.

176. See Walt, supra note 167, at 218.

177. See id. at 219.

178. See id. at 218-19; Catalano, supra note 119, at 1819; Honnold, supra note 17, at 195.

179. See Walt, supra note 167, at 220.

180. See Kastely, supra note 32, at 637-38; Schlechtriem, supra note 116, at 205.

181. See Walt, supra note 167, at 221.

182. Article 2 includes sales of goods bought for personal, family or household use, unless the seller did not know of the purpose. It also includes sales by auction, execution or authority of law, sales of stocks, shares, investment securities, negotiable instruments or money. See Fitzgerald, supra note 122, at 8; Walt, supra note 167, at 220; Catalano, supra note 119, at 1819.

183. See infra Ch. II.

184. There were two arguments presented by the United States against the granting of specific performance. One was that the sanctions for violating a court order of specific performance are very severe in common law. Courts have the right to imprison the defendant in addition to imposing fines. The other argument was that specific performance may cause inefficiency. The United Kingdom was also in favor of limiting the availability of specific performance in the CISG. See Kastely, supra note 32, at 626.

185. See Walt, supra note 167, at 218.

186. See Garro, supra note 11, at 459.

187. See Walt, supra note 167, at 218.

188. See Catalano, supra note 119, at 1814; Kastely, supra note 32, at 625.

189. Some criticize Art. 28 because they believe it gives room for forum shopping. See Kastely, supra note 32, at 626.

190. See Garro, supra note 11, at 459.

191. See Kastely, supra note 32, at 626.

192. See Catalano, supra note 119, at 1815; Kastely, supra note 32, at 627.

193. See Kastely, supra note 32, at 626.

194. See Gonzalez, supra note 88, at 97; Kastely, supra note 32, at 638; Honnold, supra note 17, at 273.

195. See Schlechtriem, supra note 116, at 202.

196. See Catalano, supra note 119, at 1818.

197. See id.

198. See id.

199. See id. at 1820.

200. See id.

201. See id. at 1817.

202. There are no rules that give the creditor the right to receive performance at the expense of the debtor but the result obtained by a damages award resembles the result of Civil law rules that permit performance at the expense of the debtor. See Honnold, supra note 17, at 269.

203. See Kastely, supra note 32, at 633-34.

204. See id. at 635.

205. See U.C.C. 2-716.

206. See id.

207. See Honnold, supra note 17, at 275.

208. See id.

209. See id.

210. See H. Greenberg, Specific Performance Under Section 2-716 of the Uniform Commercial UCC: "A More Liberal Attitude" in the "Grand Style," 17 New Eng. L. Rev. 321, 324-25 (1982).

211. U.C.C. 2-709.

212. See id.

213. There are two opposing points of view regarding the interpretation of international conventions. The first point of view is that when an international convention is adopted by the state it becomes part of the domestic law and therefore the rules and techniques used in interpreting the domestic law are also applied when interpreting the convention. The opposite view is that an international convention should be interpreted independently. The CISG explicitly adopts the second view. See Kastely, supra note 32, at 634.

214. See id.

215. See Ferrari, supra note 18, at 198.

216. See CISG, supra note 2, at art. 7; Feltham, supra note 43, at 349.

217. See Ferrari, supra note 18, at 199-202; Kaczorowska, supra note 29, at 58.

218. Common law and civil law have different approaches to the importance of preparatory materials. It is a long established practice in civil law countries to refer to travaux préparatoires when attempting to understand a certain legislation including international conventions. The situation is not the same in common law, referring to preparatory materials has become a practice only recently in the UK. Nevertheless, this practice is being encouraged in both the US and the UK. See Ferrari, supra note 18, at 207-08; Kaczorowska, supra note 29, at 58.

219. See generally John Honnold, The Sales Convention in Action - Uniform International Words: Uniform Application?, 8 J.L. & C. 207 (1998).

220. See John Honnold, Documentary History of the Uniform Law for International Sales 417 (1989).

221. See Kastely, supra note 32, at 635.

222. See Schlechtriem, supra note 15, at 76.

223. See T.H. Jackson, Jr., Specific Performance of Contracts in Louisiana, 24 Tul. L. Rev. 401, 416 (1950).

224. See Fitzgerald, supra note 122, at 7.

225. See Jackson, supra note 223, at 416.

226. See id.

227. See id.

228. See id.

229. See J. Manwaring, Les contrats 135 (1999).

230. See L.J. Romero, Specific Performance of Contracts in Comparative Law: Some Preliminary Observantions, 27 C. de D. 785, 788-90 (1986).

231. See A. Bénabent, Droit Civil: Les Obligations 364 (3rd ed. 1991).

232. Swiss law has a similar provision that permits the creditor to execute at the expense of the debtor. See C. Szladits, The Concept of Specific Performance in Civil Law, 4 Am. J. Comp. L. 208, 220-28 (1955).

233. Nonetheless, the creditor has the right to demand that what would have been done by contravention if the obligation be cancelled; and he can authorize himself to cancel at the expense of the debtor, without prejudice to damages and interest, if any have occurred.

234. An example of this situation is the closing down of a business that is in violation of an agreement not to compete. See Y.J. Goldstein, L'exécution forcée en nature des obligations contractuelles 73 (1959); P. Wéry, L'exécution forcée en nature des obligations contractuelles non pécuniaires 99-100 (1993).

235. See Szladits, supra note 232, at 217and G. Marty et al, Droit civil: les obligations 251 (2nd ed. 1989).

236. The creditor may also, in the case of non-performance, be authorized to perform the obligation himself, at the expense of the debtor.

237. See Goldstein, supra note 234, at 74.

238. The German Civil Code has a similar provision. When the obligation is one that does not involve personal skills of the debtor and can be executed by a third party, the court renders a judgment that gives the promisee the right to perform at the expense of the debtor. See Szladits, supra note 232, at 217.

239. See id. at 217; Bénabent, supra note 231, at 364 and C. Larroumet, Droit civil: les obligations, le contrat 58-59 (4th ed. 1998).

240. See A. Sériaux, Droit des obligations 252 (2nd ed. 1998).

241. See B. Starck et al, Droit civil: les obligations, contrat 572 (6th ed. 1998).

242. See Marty, supra note 235, at 249; Bénabent, supra note 231, at 365.

243. The extent to which forcing a debtor to perform is permissible will be explained later when examining Art. 1142 of the UCC, which limits the use of coercion on the person of the debtor.

244. See R.A. Newman, Equity and Law: a Comparative Study 11 (1961); J. Manwaring, supra note 229, at 134; Jackson, supra note 223, at 403.

245. See Jackson, supra note 223, at 405-06.

246. See Szladits, supra note 232, at 209; R. David & J. Brierly, Major Legal Systems in the World Today 324-26 (3rd ed. 1985).

247. See Newman, supra note 244, at 211-12.

248. See Romero, supra note 230, at 798.

249. See Jackson, supra note 223, at 404.

250. See Romero, supra note 230, at 800-03; Szladits, supra note 232, at 212.

251. See Szladits, supra note 232, at 210; Jackson, Jr., supra note 223, at 407.

252. See infra Ch. II.3.a.

253. A construction contract is a standard situations where continuous supervision of the court is necessary. See A.S. Burrows, Specific Performance at the Crossroads, 4 Legal Stud. 107 (1984).

254. This attitude has been modified and courts are granting specific performance when certain conditions are met. These conditions are certainty of the acts required, the plaintiff having an interest in the performance and that the defendant has acquired through the contract the land on which the construction will take place. See J. Berryman, The Specific Performance Damages Continuum: An Historical Perspective, 17 Ottawa L. Rev. 295, 318 (1985); Burrows, supra note 253, at 107; J.P. Dawson, Specific Performance in France and Germany, 57 Mich. L. Rev. 495, 536 (1959).

255. See Dawson, supra note 254, at 536.

256. See Romero, supra note 230, at 801.

257. This restriction plays an important role in contracts for personal services where specific performance will result in oppression of the debtor. The enforcement of similar contracts will cause the subordination of the defendant to the other party and currently it is unthinkable to encourage such subordination. In these cases, even when damages do not provide sufficient compensation, the court will not enforce the contract because respect for individual freedom outweighs the necessity to protect the other party's expectations. Enforcing contracts for personal services also disturbs peace in society. See Romero, supra note 230, at 801.

258. Specific performance can only be granted when there is consideration, regardless of the value of the consideration. See G. Jones & W. Goodhart, Specific Performance 24 -25 (2nd ed. 1996).

259. When the contract is illegal, immoral or against public policy, specific performance cannot be granted because enforcing such contracts may have detrimental consequences on society. The illegality or immorality of a contract is judged according to the rules of the country in which the contract is to be performed. See id.at 63.

260. The court may eliminate or add conditions to the performance if doing so alleviates hardship. See id. at 112-18; J. A. Priest, Hardship and Specific Performance, 134 New L. J. 927 (1984).

261. See David & Brierly, supra note 246, at 343.

262. See Romero, supra note 230, at 808.

263. Hadley v. Baxendale, 156 E.R. 145 (1854); For a detailed discussion of this case, see A.G. Murphey, Jr., Consequential Damages in Contracts for the International Sale of Goods and the Legacy of Hadley, 23 Wash. J. Int'l L. & Econ. 415 (1989).

264. See Berryman, supra note 254, at 307-10.

265. See id. at 308.

266. See J.N. Pomeroy & J.C. Mann, A Treatise on the Specific Performance of Contracts 9 (3rd ed. 1986); Comment, Limitations on the Availability of Specific Performance, 17 U. Chi. L. Rev. 409, 409-10 (1950).

267. See Romero, supra note 230, at 800; Berryman, supra note 254, at 312.

268. See Szladits, supra note 232, at 210.

269. See Muris, supra note 147, at 1056. See generally A. Herschorn, Specific Performance of Agreements for the Purchase and Sale of Land, 12 Advoc. Q. 171 (1990).

270. See E. Macdonald, The Inadequacy of Adequacy: The Granting of Specific Performance, 38 N. Ir. Leg. Q. 244, 248 (1987).

271. See Muris, supra note 147, at 1056.

272. The amount of damages would be uncertain and speculative in cases of unique goods, which renders damages inadequate compensation. See id.

273. See id.

274. See id; Manwaring, supra note 229, at 135.

275. See id.

276. See Greenberg, supra note 210, at 322.

277. Sky Petroleum Ltd. v. VIP Petroleum Ltd. 1 W.L.R. 576 (1974).

278. See id.

279. See Burrows, supra note 253, at 103.

280. See Muris, supra note 147, at 1056.

281. See generally Sky Petroleum.

282. See id.

283. See Szladits, supra note 232, at 210.

284. See Burrows, supra note 253, at 114.

285. See H. D. Gabriel, The Inapplicability of the United Nations Convention on the International Sale of Goods as a Model for the Revision of Article Two of the Uniform Commercial Code, 72 Tul. L. Rev. 1995, 996 (1998); Michael Handler, Comment, Specific Performance Under Section 2-716 of the Uniform Commercial UCC--What Other Proper Circumstances?, 33 U. Pitt. L. Rev. 243, 243 (1971).

286. See Handler, supra note 285, at 251-55.

287. U.C.C. 2-716, Comment 1 (1978 version); See Greenberg, supra note 210, at 322-24.

288. U.C.C. 2-716(1).

289. See id.

290. See id.

291. The Act gave the court the right to order specific performance when, in the eyes of the court, the goods were specific or ascertained. See Greenberg, supra note 210, at 325.

292. See U.C.C. 2-716(1).

293. See Handler, supra note 285, at 244.

294. See A.T. Kronman, Specific Performance, 45 U. Chi. L. Rev. 351, 355-65 (1978).

295. See Greenberg, supra note 210, at 324-30.

296. See id. at 330.

297. See id. at 337-38.

298. The typical unique goods in common law were heirlooms, works of art and antiques. Today, a broader meaning has been introduced by including output and requirements contracts as unique when they involve a particular source or market. See Kronman, supra note 294, at 355-56.

299. Tennessee Valley Auth. v. Masin Coal, Inc., 384 F. Supp. 1107 (E.D. Tenn. 1974); See Greenberg, supra note 210, at 349.

300. The Comment of the UCC clearly states that uniqueness should be judged according to the total circumstances surrounding the contract. By stating this rule, the UCC incorporates what was practiced by courts for a long time. See Greenberg, supra note 210, at 322.

301. Hogan v. Norfleet, 113 So. 2d 437 (Fla. App. 1959). The judgment in this case was based on the provisions of the Uniform Sales Act, which was enacted in the 1920s. Id. This Act gave courts the right to grant specific performance when the contract includes the sale of specific or ascertained goods. Id.

302. Cochrane v. Szpakowski, 49 A. 2d 692 (Pa. Sup. Ct. 1946); See Handler, supra note 285, at 246.

303. See id. at 249.

304. See Catalano, supra note 119, at 1825.

305. See id.

306. See Handler, supra note 285, at 245.

307. See Heidner v. Hewitt Chevrolet Co., 199 P. 2d 481 (Kan. Sup. Ct. 1948).

308. See Gleek v. Beer, 33 N.Y.S. 2d 833 (App. Div. 1942); Comment, supra note 266, at 248.

309. See Greenberg, supra note 210, at 329-31.

310. See Walt, supra note 167, at 226; Catalano, supra note 119, at 1827.

311. See Walt, supra note 167, at 226.

312. See Bolin Farms v. American Cotton Shippers Assn., 370 F. Supp. 1353 (W.D. La. 1974); Greenberg, supra note 210, at 344-45.

313. See Walt, supra note 167, at 228.

314. See Eastern Airlines, Inc. v. Gulf Oil Corp., 415 F. Supp. 429 (S.D. Fla. 1975); See Greenberg, supra note 210, at 347.

315. See Walt, supra note 167, at 227.

316. See Copylease Corp. of America v. Memorex Corp., 408 F. Supp. 758 (S.D.N.Y. 1976); Walt, supra note 167, at 225; Catalano, supra note 119, at 1828.

317. See id.

318. See Greenberg, supra note 210, at 336.

319. See id.at 337.

320. See id.

321. See id.

322. See Handler, supra note 285, at 250.

323. See id.

324. See id. at 249.

325. See id.

326. See Greenberg, supra note 210, at 341.

327. U.C.C. 2-709.

328. See id.

329. See E. A. Peters, Remedies for Breach of Contract Relating to the Sale of Goods under the Uniform Commercial UCC: A Roadmap for Article 2, 73 Yale L. J. 199, 241 (1963).

330. See Honnold, supra note 17, at 275-76.

331. See U.C.C. 2-709.

332. See Dawson, supra note 254, at 496.

333. See id. at 501.

334. Exécution en nature means "performance in kind."

335. See Jackson, supra note 223, at 409.

336. See id.

337. See id. at 407-08.

338. A magistrate judge. See id. at 408.

339. See Dawson, supra note 254, at 496.

340. There is a certain opposition to this view that states that contracts of sale were specifically enforced but this view is not supported by the majority of scholars. See Jackson, supra note 223, at 409.

341. See id. at 499.

342. There is evidence that during the post-classical period, specific performance became an available remedy because jurisdiction of ecclesiastical courts considered the breach of a promise made under oath as a sin, thus specific performance became the primary remedy in Canon Law. Later in Justinian's codification, specific performance became available under the obligation to give. See Romero, supra note 230, at 803-04; Jackson, supra note 223, at 408; G. Vlavianos, Specific Performance in the Civil law: Mediating Between Inconsistent Principles Inherited from a Roman-Canonical Tradition via the French Astreinte and the Québec Injunction, 24 R.G.D. 515, 520-23 (1993).

343. See Jackson, supra note 223, at 409.

344. See Dawson, supra note 254, at 504.

345. See id.

346. Medival Roman Contract commentator. See Dawson, supra note 254, at 504.

347. See Romero, supra note 230, at 805; Dawson, supra note 254, at 504; E. Massin, De l'exécution forcée des obligations de faire ou de ne pas faire 258 (1893).

348. Commentator on the French legal system. He drafted the first French Civil Code. See Jackson, supra note 223, at 412-509.

349. See id.

350. See Dawson, supra note 254, at 506.

351. See Jackson, supra note 223, at 412.

352. See id. at 413.

353. See Dawson, supra note 254, at 509.

354. See Romero, supra note 230, at 806.

355. See Jackson, supra note 223, at 412.

356. See Szladits, supra note 232, at 221.

357. See id.

358. See id.

359. Specific performance is the primary remedy in Germany, which means that, in theory, the plaintiff cannot ask for damages when performance is possible. Nevertheless, the result is different in practice. See id. at 221-28. Under Swiss law, the plaintiff's demand for damages is refused when specific performance is possible. But courts have created exceptions to this rule. They do not enforce performance in certain cases, such as when the buyer has a duty to accept the goods. See id. at 228-31.

360. See Szladits, supra note 232, at 216.

361. See id. at 217.

362. See id.

363. See Massin, supra note 347, at 239.

364. The impossibility of performance should be clear from the circumstances in a way that the judge has no doubt about it being absolutely impossibile to perform. It is only after being convinced by objective proofs that an order of performance will result in the judge being unable to refuse to grant exécution en nature. One of the situations that falls within the realm of impossibility is when performance will deprive a third party from a right that he has acquired in good faith. Another situation is when it is impossible to enforce performance or when performance cannot be achieved without exercising violence on the person of the debtor. See Szladits, supra note 232, at 216; W. Jeandidier, L'exécution forcée des obligations contractuelles de faire, Rev. Trim. Dr. Civ. 700, 713-18 (1976).

365. See Szladits, supra note 232, at 220.

366. See id.

367. An example of this situation is when the cost of performance is very high. See id.

368. See id. at 216-17.

369. This notion is stated in both the German and Swiss Civil Code. When granting performance is against the requirements of good faith the court will not enter a judgment of exécution en nature. See id. at 220-31.

370. See id. at 210-211.

371. The court may also refuse to grant specific performance when doing so affects the rights of a third party. See Szladits, supra note 232, at 220.

372. See C. civ., supra note 5, at arts. 1142-1144.

373. The Astreinte is an order to pay a sum of money for each day of delay in performance. See Jackson, supra note 223, at 416. The amount is not fixed in advance, the court determines an amount of money that is the basis for measuring the astreinte. See id. The longer performance is delayed, the more the debtor must pay. This coercion imposes a pressure on the will of the debtor but it also targets the debtor's assets. See id. The astreinte represents an important means for ensuring exécution en nature. It is an efficient means of pressure because no matter how wealthy a debtor may be, his wealth cannot resist the augmenting amount of the astreinte. See id. Nevertheless, the judge may reduce the amount to be paid to be proportionate with the loss suffered by the plaintiff. See id. In giving a judgment of astreinte, the court has discretionary power to determine the amount depending on the degree of wealth of the debtor and also depending on his degree of refusal to perform. See id. Therefore, the astreinte has an arbitrary character. See Jackson, supra note 223, at 416. It also threatens the debtor for his refusal to perform and it puts pressure on him, which gives it its coercive character. See id. It is not a means of performance of the obligation, it is an indirect coercive method. See id. Nevertheless, it has been criticized because it gives the creditor a sum that he does not deserve. See id. It enriches him at the expense of the debtor. See id.

374. See Jackson, supra note 223, at 418.

375. See Szladits, supra note 232 , at 231-34.

376. See Dawson, supra note 254, at 525; Romero, supra note 230, at 811.

377. In German Law, a contractual obligation entitles the promisee to claim performance, which is the normal right of a promisee. The principle rule is that whenever specific performance is available, it is the only remedy that can be granted and the promisee cannot claim damages. See Szladits, supra note 232, at 220-28. Damages will be granted when performance becomes impossible or when it would involve disproportionate costs or when the contract is for an artistic or intellectual work. Courts have no discretionary power in this matter. Nevertheless, the practice is rather different. In contracts for sale of goods a high percentage of promisees prefer to receive damages and the courts grant them what they want. See id. In Swiss law, the rules are similar to German law, except that the creditor's right to specific performance is not stated clearly. The creditor cannot choose damages when specific performance is possible. See id. at 228-231.

378. Exécution en nature is regulated by articles 1142-1144 of the French Civil Code. See C. civ., supra note 5, at arts. 1142-44.

379. Any obligation to do or not to do, resolves in damages and interest in the case of non-performance on the part of the debtor.

380. See J. Flour & J .L. Aubert, Les obligations: l'acte juridique, 25 (8th ed. 1998).

381. See Szladits, supra note 232, at 214-15; Marty, supra note 235, at 249.

382. In German Civil law, an obligation to give is executed by way of seizure by a court officer when the debtor refuses to deliver.

383. See Flour & Aubert, supra note 380, at 25-26; P. Delebecque & F. J. Pansier, Droit des obligations: responsabilité civile-contrat 2-3 (2nd ed. 1998).

384. Szladits, supra note 232, at 214.

385. See Dawson, supra note 254, at 510.

386. See Jackson, supra note 223, at 413.

387. See Starck, supra note 241, at 566.

388. This is stated in Art. 1134 of the French C. civ. which reads: "Les conventions légalement formées tiennent lieu do loi à ceux qui les ont faites." Id.

389. See J. L. Baudouin, L'exécution spécifique des contrats en droit québécois, 5 McGill L.J. 108, 117 (1958).

390. Giving the creditor the right to force the debtor to perform is not stated clearly in any article of the French C. civ. It is Art. 1134 that is taken as the basis for explaining the primacy of specific performance in the French system. See Vlavianos supra note 342, at 535.

391. See Romero, supra note 230, at 806.

392. It is only physical pressure that is considered as inadmissible as means of coercion. See Jeandidier, supra note 364, at 704-05.

393. Imprisonment for civil obligations was abolished by the law of July 22, 1867.

394. See Romero, supra note 230, at 807.

395. See Jackson, supra note 223, at 414.

396. See Goldstein, supra note 234, at 72.

397. See Jeandidier, supra note 364, at 706.

398. In addition to the concern for personal freedom, there is another reason for not granting specific performance in contracts for artistic or intellectual works. The value of such a work lies in the skills and inspiration of the debtor. It is unthinkable that such a work can have the same value when pressure is exercised on the person of the debtor. Pressure kills inspiration and therefore the quality of the work will be extremely poor. See Starck, supra note 241, at 568-69; Ph. Malaurie & L. Aynes Droit civil: les obligations 594-95 (8th ed. 1998); Jeandidier, supra note 364, at 717.

399. See Marty, supra note 235, at 251.

400. See id.; Szladits, supra note 232, at 217.

401. See Goldstein, supra note 234, at 74.

402. The German Civil Code has a similar provision. When the obligation is one that does not involve personal skills of the debtor and can be executed by a third party, the court renders a judgment that gives the promisee the right to perform at the expense of the debtor.

403. See Fitzgerald, supra note 122, at 19.

404. Civil Code of Lower Canada, Art. 1065-66 C.C.L.C.

405. See Vlavianos, supra note 342, at 544-46.

406. Code of Civil Procedure, Art. 751, C.C.P.

407. See Vlavianos, supra note 342, at 551.

408. See Côté v. Fortin, C.S. 218 (1979).

409. See Baudouin, supra note 389, at 129.

410. Civil Code of Quebec, Art. 1601-602, C.C.Q.

411. This conclusion about the Civil Code's approach towards specific performance is reinforced by the provision of Art. 1590, which states clearly the creditor's right to require performance.

412. See Schlechtriem, supra note 15, at 376.

413. See Honnold, supra note 17, at 294.

414. See Review of The Convention on Contracts for the International Sale of Goods (CISG) 30-32 (1996).

415. See arts. 47, 49(1) and 63 of the BGB (German Civil Code); Mapp & Nicoll, supra note 83, at 318; For further discussion regarding the notion of nachfrist in both the CISG and the German Civil Code see generally M. DiPalma, Nachfrist under National Law, the CISG, and the UNIDROIT and European Principles: A Comparison, 5 Int'l Contract Adviser 28 (1999).

416. Another indication of a preference for performance is in the Secretariat's Commentary. Although liquidated damages are not mentioned in the CISG, the Commentary mentions it as a means to ensure performance.

417. See Société Giustina International v. Société Perfect Circle Europe, CAVersailles, Pace Law School Institute of International Commercial Law Database [hereinafter Pace] (last modified Jul. 13, 1999) <http://www.cisg.law.pace.edu/cases/980129f1.html>.

418. Inadequacy of damages is especially true in planned economies where there may be no opportunity to find substitute goods in the local market. In similar economies specific performance may be the only adequate remedy because damages will not help in finding a substitute transaction and they constitute a last resort. In contracts concluded in these economies, including a term waiving specific performance is void. In addition to that the plan will be disturbed when the supply of certain goods is not performed. See B. Grossfeld, Money Sanctions for Breach of Contract in a Communist Economy, 72 Yale L.J. 1326, 1330-31 (1963).

419. Time and money spent finding and negotiating a deal is difficult to estimate and therefore damages are inadequate compensation. Another argument set forth is that in international contracts, parties expect to receive specific performance because the civil law system, which recognizes the right to specific performance, has influenced the legal systems of many countries of the world.

420. See M. Marques Roque Joachim v. La Sarl Holding Manin Rivière, CA Grenoble, Pace,(last modified Jul. 13, 1999) <http://www.cisg.law.pace.edu/cases/950426f2.html>.

421. See id.

422. See id.

423. OLG Hamm, Pace, (last modified Jul. 13, 1999) <http://www.cisg.law.pace.edu/cisg/text/e-text-46.html#case>.

424. See id.

425. See Schlechtriem, supra note 15, at 483.

426. KG Berlin, Pace, (last modified Jul. 13, 1999) <http://www.cisg.law.pace.edu/cases/940124g1.html>.

427. See id.

428. ICC Arbitration Case No. 7197 (1992), (International Chamber of Commerce), Pace, (last modified Jul. 13, 1999) <http://www.cisg.law.pace.edu/cases/927197i1.html>.

429. See id.

430. During the negotiations, the United States proposed not giving the seller the right to require payment of the price if the buyer has not taken delivery of the goods and the seller can resell the goods without unreasonable, substantial additional expense or inconvenience. See id.

431. See Grossfield, supra note 418, at 1330.

432. See id. at 1330-31.

433. See id.

434. See id. at 1331.

435. See id.

436. See Grossfeld, supra note 418, at 1331.

437. See A. Wood, North-South Trade, Employment and Inequality, 4-5 (1994); A. Fishlow et al., Rich and Poor Nations in the World Economy 56-57 (1978).

438. See Schlechtriem, supra note 15, at 61

439. See id.

440. See Kaczorowska, supra note 29, at 62.

441. See id.

442. See id.

443. See id.

444. See Schlechtriem, supra note 15, at 62-63.

445. See id.

446. For a discussion of how difficult it may be to achieve uniformity in the field of the CISG see Robert A. Hillman, Applying the United Nations Convention on Contracts for the International Sale of Goods: The Elusive Goal of Uniformity, in Review of The CISG on Contracts for the International Sale of Goods 21 (1996) .

447. CISG, supra note 2, at art. 7(1).

448. See Ferrari, supra note 18, at 213-15.

449. Not performing the obligations of a contract without good reason is considered bad faith. See J. Klein, Good Faith in International Transactions, 15 Liverpool L. Rev. 115, 118-119 (1993).

450. The notion of good faith in common law is closely related to equity because the jurisdiction of equity courts was based on this notion. The role of good faith is more limited in common law than in civil law because the main concern in common law is economic efficiency. Nevertheless, common law legislation includes provisions regarding observance of good faith. See id. at 117-118.

451. Delegates from civil law countries considered good faith necessary not only in the performance phase of the contract, but also in the negotiation phase, but this proposal was rejected. See Klein, supra note 449, at 120-123.

452. See Garro, supra note 11 at 465-467; Kaczorowska, supra note 29 at 66.

453. See M. Marques Joachim v. La Sarl Holding Manin Rivière, CA Grenoble, 26 April 1995, Pace, (last modified 13 July 1999),<http://www.cisg.law.pace.edu/cases/950426f2.html>.

454. See id.

455. See id.

456. Art. 7 imposes an implicit limitation to the right to specific performance. When a courts finds that the party claiming performance is doing so in order to punish the other party, the court should refuse to grant specific performance. Bad faith can also be found when the cost of performance is disproportionate to the benefit received. See Klein, supra note 449, at 131.

457. See CISG, supra note 2, at art. 46.

458. See id.

459. See id.

460. See Klein, supra note 449, at 131.

461. See generally Marques Joachim, CA Grenoble, supra note 453.

462. See id..

463. See Klein, supra note 449, at 133-40.

464. See id.

465. See id.

466. See id.

467. See D. Baumer & P. Marchall, Willful Breach of Contract for the Sale of Goods: Can the Bane of Business be an Economic Bonanza?, 65 Temple L. Rev. 159, 161 (1992).

468. See id. at 161-62.

469. See id. at 161-67.

470. Some view damages as not providing adequate compensation because consequential damages may not be proved and because they do not cover transaction costs or attorney fees. Some consider specific performance as the adequate remedy out of moral concerns for keeping one's promise. See id.

471. One of the reasons damages are sometimes inadequate compensation is because a court may err in estimating the costs since substitute goods may be of a different quality. This is especially true in international transactions where it is often impossible to find identical products. Therefore, in assessing damages, the court may ignore issues such as quality, warranty and the reputation of the brand. Damages are not considered inadequate because they are based on the market value and the subjective value of the non-breaching party. Compensation being the purpose of all remedies, courts should respect the subjective value in order to achieve full compensation. Specific performance is the remedy that can satisfy this goal by respecting the subjective value. See Muris, supra note 147, at 1054-55; T.S. Ulen, The Efficiency of Specific Performance: Towards a Unified Theory of Contract Remedies, 83 Mich. L. Rev. 341, 365 (1984).

472. See Delchi Carrier SpA v. Rotorex Corp., 71 F.3d 1024 (2d Cir. 1995), Pace, (last modified 13 July 1999),<http://www.cisg.law.pace.edu/cisg/text/e-text-46.html#case>.

473. See id.

474. See Zürich Arbitration Proceeding, 31 May 1996, Pace, (last modified 13 July 1999) <http://www.cisg.law.pace.edu/cisg/text/e-text-62.html#case>.

475. See id.

476. See id.

477. See id.

478. See id.

479. See id.

480. See Foliopack Ag v. Daniplast SpA, Pretura circondariale di Parma Italy, 24 Nov. 1989, Pace, (last modified July 13, 1999) <http://www.cisg.law.pace.edu/cisg/text/e-text-51.html>.

481. See id.

482. See id.

483. See id.

484. See id.

485. See Zürich Arbitration Proceeding, supra note 474; see also Pretura circondariale di Parma, supra note 480.

486. Leaving it to business-people to decide the proper remedy may create similar practices in the field of remedies because the reasons influencing their decisions are similar. This situation renders the practice of courts also similar. Thus, it creates uniformity independent from uniform laws. Nevertheless, differences in this field arise as result of the divergence of surrounding circumstances in which business people conduct their business.

487. See the CISG, supra note 2, at art. 28.

488. See id.

489. This is demonstrated by a case where an Egyptian businessman ordered used printing machines from a German company. The seller did not perform his obligations to deliver the goods and the seller fixed an additional period of time for performance at the end of which the seller had still not performed and the seller had to avoid the contract. See OLG Celle, 24 May 1995, Pace, (last modified July 13, 1999) <http://www.cisg.law.pace.edu/cisg/text/e-text-51.html>.

490. Concern for personal freedom is the main rationale for Art. 1142 of the French Civil Code. See C.civ., supra note 5, at art. 1142.

491. See id.

492. See CISG, supra note 2, at art. 28.

493. See id.

494. See Delchi Carrier S.p.A., supra note 472.

495. See id.

496. See OLG Düsseldorf, 10 February 1994, Pace, (Last modified 13 July 1999) <http://www.cisg.law.pace.edu/cisg/text/e-text-46.html#case>.

497. See id.


Pace Law School Institute of International Commercial Law - Last updated May 11, 2001
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