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Cite as Bonell, in Bianca-Bonell Commentary on the International Sales Law, Giuffrè: Milan (1987) 65-94. Reproduced with permission of Dott. A Giuffrè Editore, S.p.A.

Article 7

Michael Joachim Bonell

1. History of the provision
2. Meaning and purpose of the provision
3. Problems concerning the provision

ARTICLE 7

(1) 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.

(2) Questions concerning matters governed by this Convention which are not expressly settled in it are to be setded in conformity with the general principles on which it is based or, in the absence of such principles, in conformity with the law applicable by virtue of the rules of private international law.

1. History of the provision.

     1.1. - The interpretation of a uniform law is of particular importance. Any legislation, whether of national or international origin, raises questions concerning the precise meaning of its individual provisions. Moreover, such legislation, by its very nature, is unable to anticipate all of the problems to which it will be applied. In applying domestic statutes, one can rely on long established principles and criteria of interpretation to be found within each legal system. The situation is far more uncertain with respect to an instrument which, although formally incorporated in the various national legal systems, has been prepared and agreed upon at an international level. May one still resort to the ordinary principles and criteria of interpretation and, if so, are they to be taken from the law of the forum or from the law which according to the relevant rules of private international law would be applicable in the absence of the uniform law? Or should one adopt a different approach so as to avoid the risk that the same [page 65] body of rules be construed and implemented differently by divers States? And if so, how can such an autonomous and possibly uniform interpretation be achieved?

     1.2. - ULIS contained two provisions which directly or indirectly addressed the problem of its interpretation. On the one hand, it stated in general terms that:

Rules of private international law shall be excluded for the purpose of the application of the present Law, subject to any provision to the contrary in the said Law (Article 2).

On the other hand, with special reference to the problem of gap-filling, it stated that:

Questions concerning matters governed by this Law which are not expressly settled in it are to be settled in conformity with the general principles on which the present Law is based (Article 17).

These two provisions indicate that ULIS was intended to constitute a self-contained law of sales, to be construed and applied autonomously, i.e., without any reference to or interference from the different national laws.

     1.3. - Within UNCITRAL the «revolutionary» approach adopted in ULIS with respect to its interpretation (DAVID, International Encyclopedia of Comparative Law, II, chap. 5, The International Unification of Private Law, 1971, 138) met with both approval and criticism. Those who favoured Article 17 of ULIS stressed that such a provision was needed to emphasize that the uniform law was an international instrument which should be interpreted and applied in a uniform manner. After all, it was pointed out, if courts were permitted to turn to their domestic law, this would preclude the application of the uniform law in many cases that the drafters and the parties themselves had wanted to be covered by the uniform law. It would also involve a great amount of uncertainty because the relevant rules of private international law for the determination of which national law should be applied in each case are neither clear nor uniform. In opposition to those favouring Article 17 of ULIS, it was first of all argued that the guidance therein provided for the interpretation of the uniform [page 66] law was manifestly inadequate. The uniform law did not specify or indicate the «general principles» on which it was based, and it was even questionable whether any such general principles could ever be found. Furthermore, the very idea of considering the uniform law as a body of law totally separated from the various national laws was rejected. It was noted that a number of important questions related to contracts of sale were not dealt with at all in the uniform law. On the other hand the same uniform law contained many terms also used in domestic law, but which the uniform law did not specifically define. To suggest that these questions could be solved and these terms be .construed without having recourse to national law seemed to be entirely unrealistic and unpractical (see Yearbook, I (1968-1970), 170; Yearbook, II (1971), 49).

     1.4. - At the first session of the Working Group in 1970 several proposals were submitted for the revision of Article 17 of ULIS. On the one hand it was suggested that the text be redrafted as follows:

The present Law shall be interpreted and applied so as to further its underlying principles and purposes, including the promotion of uniformity in the law of international sales.

On the other hand it was proposed that the provision be deleted altogether or modified to state expressly that «private international law shall apply to questions governed but not settled by ULIS». It was also suggested to combine the two proposals by adding at the end of the first proposal language such as «otherwise, the rules of private international law shall apply». None of these proposals was supported by a majority of the Working Group (see Yearbook, I (1968-1970), 181-183). At the request of the Commission which at its third session in 1970 was equally unable to reach an agreement (see Yearbook, I (19681970), 136), the Working Group discussed the matter again at its second session in 1971 and on that occasion decided to recommend the adoption of the following new version of Article 17:

In interpreting and applying the provisions of this Law, regard shall be had to its international character and to the need to promote uniformity [in its interpretation and application]. [page 67]

The report of the Working Group said that the omission from the original text of the reference to «the general principle on which the present Law is based» was due to the fact that such a reference was considered to be too vague. On the other hand it was felt that the proposed revision would clearly express two considerations not mentioned in the original Article 17, namely the international character of the law and the need for uniform interpretation and application (see Yearbook, II (1971), 62). At its fourth session in 1971 the Commission approved the new provision as proposed by the Working Group. At the same time it was suggested that the provision be supplemented by an additional paragraph dealing with gaps in the uniform law. However, since opinions were equally divided between those who insisted on a solution along the lines of Article 17 of ULIS and those who on the contrary favoured the approach according to which possible gaps in the uniform law be filled in by domestic laws as indicated by the rules of private international law, the Commission decided not to take any final decision on this matter and to refer it to the Working Group for its consideration at an appropriate time (see Yearbook, II (1971), 72). At subsequent sessions devoted to the revision of ULIS, the Working Group did not further discuss the matter. The only change introduced to the original proposal was to delete the words between square brackets, since they were considered to be redundant.

Consequently, the Sales Draft when adopted by the Working Group at its seventh session in 1976 contained Article 13 which read as follows:

In the interpretation and application of the provisions of this Convention, regard is to be had to its international character and to the need to promote uniformity (Yearbook, VII (1976), 90).

     1.5. - In the course of the revision of the uniform law on formation of contracts for the international sale of goods the Working Group adopted at its ninth session in 1978 a new provision (Article 5) not contained in ULFC, according to which:

In the course of the formation of the contract the parties must observe the principles of fair dealing and act in good faith (Yearbook, IX (1978), 67). [page 68]

This article was the subject of a lengthy discussion at the eleventh session of the Commission in 1978 (Yearbook, IX (1978), 35; see also id., 132-133). Those who favoured the deletion of the provision pointed out that, although good faith and fair dealing are highly desirable principles in international commerce, the way in which they were formulated was too vague. They argued that national courts applying the provision would necessarily be influenced by their own legal and social traditions with the result that different interpretations would be given to the provision in different countries. It was also noted that the draft did not specify the consequences of failure to observe the principles which were made binding on the parties. This means that the consequences of a violation would be left to national law with the result that no uniformity of sanctions would be achieved. In support of the article's retention, it was first of all argued that because of the universal recognition of the principle of good faith there would be little harm in including it in the Convention. As to the objection that the proposed provision did not set out the consequences of a violation of the principles of good faith and fair dealing, it was argued that this should be determined by the courts in a flexible manner according to the particular circumstances of each case. In any event, even without sanctions, the existence of the provision would draw the attention of the parties and the court to the fact that high standards of behaviour were expected in international trade transactions.

A number of possible compromise solutions were put forward to resolve the difference of opinion. Thus it was suggested that the substance of Article 5 could be contained in a preamble to the Convention. However, it was objected that this would deprive it of any effect. Another proposal was to incorporate the requirement of the observance of good faith into the rules for interpreting the statements and conduct of the parties. Against this suggestion it was argued that Article 5 was not concerned with the intent of the parties, but sought to establish a standard of behaviour to which the parties were obliged to conform. A third proposal, which the Commission eventually accepted as a realistic compromise solution, was to incorporate the principle of the observance of good faith into the article on the interpretation and application of the provisions of the Convention. [page 69]

Consequently, Part II of the new consolidated text of the UNCITRAL Draft Convention as adopted by the Commission at the same session (Yearbook, IX (1978), 14 et seq.) no longer contained a provision corresponding to Article 5 of the original Formation Draft. Instead, Article 6, which corresponded to Article 13 of the former Sales Draft was revised so as to read as follows:

In the interpretation and application of this Convention regard is to be had to its international character and to the need to promote uniformity and the observance of good faith in international trade.

     1.6. - At the Vienna Conference several amendments to Article 6 of the UNCITRAL Draft Convention were submitted. Some of them were merely of a drafting character and led to the small changes which now appear in the wording of Article 7(1) of the Convention. Others were of substance since they were intended to add a new paragraph to the provision dealing with the problem of gaps in the Convention. As had been the case during the deliberations within UNCITRAL (see § 1.4., supra), two different kinds of solutions were advocated. On the one hand it was suggested to provide that unsettled questions should be decided according to «the law of the seller's place of business» (see the amendment of Bulgaria: A/Conf.97/C.1/L.16) or more generally in conformity with «the law applicable by nature of the rules of private international law» (see the amendment of Czechoslovakia: A/Conf.98/C.1./L.15). On the other hand, it was proposed (see the amendment of Italy: A/Conf.97/C.1/L.59) that:

Questions concerning matters governed by this Convention which are not expressly settled therein shall be settled in conformity with the general principles on which this Convention is based or, in the absence of such principles, by taking account of the national law of each of the parties.

None of these proposal was able to gain sufficient support from the other delegations. As to the Bulgarian amendment, it was felt that, even if one intended to accept its underlying idea according to which gaps in the Convention should always be filled on the basis of domestic law, it was not advisable to refer in every single case for this purpose to the law of the seller's place of business. Regarding the Italian proposal the main difficulties were found in its last part. It was argued that the meaning of «the national law of each of the parties» was far from clear. Moreover, it was [page 70] likewise unclear what would be the result if concerning a particular issue the national laws of the seller and of the buyer provided irreconcilable solutions (Official Records, II, 255-256). As a compromise solution it was suggested to combine the first part of the Italian proposal with the amendment submitted by Czechqslovakia and consequently to add a second paragraph to the provision contained in Article 6 of the UNCITRAL Draft Convention which would read as follows:

Questions concerning matters governed by this Convention which are not expressly settled in it are to be settled in conformity with the general principles on which it is based or, in the absence of such principles, in conformity with the law applicable by virtue of the rules of private international law.

Although some delegations expressed their preference for the maintenance of the original text of Article 6, the proposal was eventually adopted by 17 votes to 14, with 11 abstentions (Official Records, II, 257). I

     1.7. - The appropriateness of referring to the principle of good faith in this article on the Convention's interpretation and application was also questioned again at the Vienna Conference. Two amendments were submitted, both suggesting to delete the last part of paragraph 1 and to transfer it to another context. More precisely, one proposal was to add at the end of Article 7(3) of the UNCITRAL Draft Convention (now Article 8) the words «having regard to the need to ensure the observance of good faith in international trade» (see the amendment of Norway: A/Conf.97/C.l/L.28). According to another proposal (see the amendment of Italy: A/Conf.97/C.l/L.59) a new article should have been included after Article 6 of the UNCITRAL Draft Convention (now Article 7) stating that:

In the formation, interpretation and performance of a contract of sale the parties shall observe the principles of good faith and international cooperation.

Although the two proposals did receive some support, the prevailing view was against reopening discussion on an issue that had already been the subject of extensive debate within UNCITRAL leading to the present compromise solution (see § 1.6., supra). Article 7(1) was thus adopted without further changes. [page 71]

2. Meaning and purpose of the provision.

     2.1. - Both in light of legislative history and from a systematic viewpoint this article can be divided into three different provisions: paragraph (1), first part, where the basic criteria for the interpretation of the Convention are set forth; paragraph (1); second part, establishing the relevance which in this context is to be given to the principle of good faith; and finally, paragraph (2) which deals with the manner in which possible gaps in the Convention are to be filled in. Given the close relationship between the questions of interpretation and of gap-filling it is advisable to examine first the two provisions dealing with these questions. The other provision relating to the principle of good faith is of a rather special nature and will therefore be discussed separately.

     2.2. - Of the two provisions contained in paragraph (1), first part, and in paragraph (2), it is the former which is clearly the most important one. It deals with the interpretation of the Convention, i.e., the process by which those called upon to apply the Convention to a particular case ascertain the meaning and the legal effects to be given to its individual articles. Consequently this provision is also decisive for determining the precise scope of the following paragraph (2). Indeed, the different rules or techniques adopted in the process of interpretation have an influence not only on the way in which ambiguities in the legislative language are solved, but also on the decision whether a given provision may be applied by analogy or whether there exists a true gap in the Convention.

          2.2.1. - According to paragraph (1), first part, in the interpretation of the Convention, regard is to be had (a) «to its international character» and (b) «to the need to promote uniformity in its application». The two criteria are only apparently independent from each other. On examination the second criterion turns out to be nothing more than a logical consequence of the first.

To have regard to the «international character» of the Convention means first of all to avoid relying on the rules and techniques traditionally followed in interpreting ordinary [page 72] domestic legislation. The Convention is a piece of legislation which has been prepared and agreed on at an international level. It remains an autonomous body of law even after its formal incorporation into the different national legal systems. This is the case not only when such incorporation is the result of a simple act of ratification by which the Convention is given direct force of law, but also when a special national legislation embodying its rules has been promulgated.

The consequences of the Convention's international character are particularly relevant in those legal systems, as is the case in most common law countries, where statutes are traditionally interpreted narrowly so as to limit their interference with the law developed through jurisprudence. Contrary to ordinary domestic legislation, which courts may still consider an infringement of «their» case law, the Convention, once adopted, is intended to replace all the rules in their legal systems previously governing matters within its scope, whether deriving from statutes or from the case law. This means that in applying the Convention there is no valid reason to adopt a narrow interpretation. Instead of sticking to its literal and grammatical meaning, courts are expected to take a much more liberal and flexible attitude and to look, wherever appropriate, to the underlying purposes and policies of individual provisions as well as of the Convention as a whole. After all, in the United States such an approach has been formally adopted for the interpretation of the Uniform Commercial Code (§ 1-102 (3) United States Uniform Commercial Code). Moreover, in a number of cases not only American but also English courts have recently shown more and more their willingness to take a similar attitude with respect to existing international conventions (see, e.g., with respect to the 1929 Warsaw Convention on International Carriage by Air, Lisi v. Alitalia S.p.a., 370, Federal Reporter, Second Series (T.J.S.), 508 (1966); Day v. Trans World Airlines, Inc., 528, Federal Reporter, Second Series (U.S.), 31 (1975); Corocfraft, Ltd. v. Pan American World Airways, Inc., [1969] 1 All England Law Reports, 82; Fothergill v. Monarch Airlines, [1980] 2 All England Law Reports, 696; with respect to the 1924 Brussels Convention on Bills of Lading, Mitsui & Co., Ltd. et Ataka & Co., Ltd. v. American Export Lines, Inc., 628, Federal Reporter, Second Series, 807 (1981); The Hollandia, [1982], 3 Weekly Law Reports 1111; with respect [page 73] to the 1956 Geneva Convention on International Carriage by Road, Buchanan v. Babco Forwarding and Shipping, [1977], 1 All England Law Reports, 518; Thermo Engineers Ltd. and Anhydro A/S v. Ferrymaster Ltd, [1981], 1 All England Law Reports, 1142). The fact that the present Convention, like other recent conventions not yet in force (see Article 7 of the 1974 Limitation Convention; Article 6 of the 1983 Geneva Convention on Agency in the International Sale of Goods; Article 3 of the 1978 United Nations Convention on the Carriage of Goods by Sea) now contains an express provision to the same effect, should further strengthen this tendency.

          2.2.2. - Yet, to have regard to the «international character» of the Convention also implies the necessity of interpreting its terms and concepts autonomously, i.e., in the context of the Convention itself and not by referring to the meaning which might traditionally be attached to them within a particular domestic law.

Such necessity derives from the fact that not only the content of the Convention, but also its formal presentation is the result of prolonged deliberations between lawyers from all parts of the world representing sometimes totally different cultural and legal backgrounds. When drafting the single provisions these experts had to find sufficiently neutral language on which they could reach a common understanding. Even in the exceptional cases where terms or concepts were employed which are peculiar to a given national law, it was never intended to use them in their traditional meaning. After all, the Convention has been drawn up in six equally authentic language versions corresponding to the official languages of the United Nations, and it is very likely that terms like «reasonable» or «fundamental breach of contract», «resolution» or «dommage-intérêts», when no longer expressed in their original version, fail to evoke any traditional meaning.

Another and more important reason for the autonomous interpretation of the Convention relates to the Convention's ultimate aim, which is to achieve world-wide uniformity in the law of international sale contracts. To this end it is not sufficient to have the Convention adopted by the single States. It is equally important that its provisions will be interpreted in the same way in various countries. This result would be seriously jeopardized if [page 74] those called on to apply the Convention would resort, in case of ambiguities or obscurities in the text, to principles and criteria taken from a particular domestic law, be it the law of the forum or the law which in the absence of the Convention would govern the individual contract of sale.

     2.3. - In connection with an international sales contract there may arise questions which, although falling within the scope of the Convention, are not specifically regulated by any of its provisions. Article 7(2) states that these questions should be settled «in conformity with the general principles on which [the Convention] is based or, in the absence of such principles, in conformity with the law applicable by virtue of the rules of private international law». The purpose of the provision is quite clear. In accordance with the basic criteria established in paragraph (1), first part, for the interpretation of the Convention in general, not only in the case of ambiguities or obscurities in the text, but also in the case of gaps, courts should to the largest possible extent refrain from resorting to the different domestic laws and try to find a solution within the Convention itself.

Yet when can one speak of the existence of gaps in the Convention? And what precisely does it mean that they should be resolved in conformity with «the general principles on which [the Convention] is based», and only in the absence of such principles, in conformity with «the law applicable by virtue of the rules of private international law»?

          2.3.1. - A first condition for the existence of a gap in the sense of Article 7(2) is that the case at hand relates to «matters governed by [the] Convention». Issues which are not within the scope of the Convention have been deliberately left to the competence of the existing non-unified national laws. The fact that there is no provision in the uniform law dealing with them cannot be regarded as a gap, but is a logical consequence of that preliminary decision. The scope of the Convention is generally defined by Article 4, which states that:

This Convention governs only the formation of the contract of sale and the rights and obligations of the seller and the buyer arising from such contract. [page 75]

The same article then expressly excludes in particular the validity of the contract and the effect of the contract on the property in the goods (see commentary on Article 4, supra). However, there are other issues not governed by the Convention. Some of them, such as the capacity of the parties or the authority which one party may have conferred on a third person to conclude the contract on his behalf, are not even mentioned, since they are traditionally separated from sales law. Some others are expressly excluded by special provisions of the Convention. This is the case, for instance, of the liability of the seller for death or personal injury caused by the goods to the buyer or any other person (Article 5); the possibility of obtaining judgments for specific performance (Article 28); and the formalities which may be necessary for the payment of the price (Article 54).

A further condition. for the application of Article 7(2) is that the unsolved questions «are not expressly settled in [the Convention]» (emphasis added). The wording, which corresponds literally to that used in Article 17 of ULIS, has been criticized on the ground that recourse to the «general principles» of the uniform law is justified only when a solution cannot be found by interpreting its single provisions, which includes their possible extension by analogy to cases not expressly regulated (see DÖLLE, Art. 17 des Einheitsgesetzes, 139-140). On the other hand, it has been insisted that the particular criteria of this paragraph should apply, whenever the Convention contains no specific provision dealing with the case at hand. Significantly, however, those who hold this view read the reference to the «general principles» primarily as an invitation to the application of specific provisions of the Convention by analogy (see FARNSWORTH, The Perspective of the Common Law Countries, 8-10; HONNOLD, Uniform Law, 132-133; MERTENS-REHBINDER, Internationales Kaufrecht, 142). The difference of opinion is largely nominal. In other words, it ultimately depends on how broadly the formula «in conformity with. the general principles on which [the Convention] is based» is interpreted.

          2.3.2. - Referring to general principles of law as a means for gap-filling is a well-known technique in civil law systems. The Austrian Civil Code of 1811 already contained a provision (§ 7) according to which: [page 76]

Where a case cannot be decided either according to the literal text or the plain meaning of a statute, regard shall be had to the statutory provisions concerning similar cases ... If the case still remains doubtful, it shall be decided ... on the basis of principles of natural law.

The Civil Codes of Italy (Article 12 of the Preliminary Provisions), Spain (Article 6) and Egypt (Article 1) have similar provisions. The Swiss Code goes even further by stating that, if neither the statute nor the customary law provides a solution to a given case, «the judge shall decide according to the rule which he would establish as legislator ... . In doing so he shall base himself on sound scholarship and tradition» (Article 1). Yet even in countries such as France or the Federal Republic of Germany, where the approach is not formally imposed by statute, it is taken for granted that a Code or any other legislation of a more general character must be considered as more than the mere sum of its individual provisions. In fact, it. must be interpreted and, if necessary, supplemented on the basis of the general principles which underlie its specific provisions (see ZWEIGERT-KÖTZ, Einführung in die Rechtsvergleichung auf dem Gebiete des Privatrechts. Tübingen (Mohr), 2nd ed. 1982, I, 10.3 et seq.).

The situation is quite different in the common law systems. General principles, exist also in these systems, although the concept as such is less familiar (see for some important illustrations, NEVILLE BROWN, General Principles of Law and the English Legal System, in CAPPELLETTI (ed.), New Perspectives for a Common Law of Europe, Florence, 1978, 174, et seq.; CHLOROS, Principle, Reason and Policy in the Development of European Law, in The International and Comparative Law Quarterly 17 (1968), 849 et seq.). Yet, contrary to the civil law systems where the general principles are established by legislation, «in the common law world the lawyer looks for his principles in the «cases», and the statutes merely fill in details, the «case law» playing the role of the Codes on the Continent» (KAHN-FREUND, Common Law and Civil Law, Imaginary and Real Obstacles to Assimilation, in CAPPELLETTI (ed.), New Perspectives for a Common Law of Europe, cit., 154). In other words, statutory law is seen as only fixing rules for defined situations, not as a possible source of general principles. As such, not only are the statutes traditionally interpreted in a very strict sense (see § 2.2.1., supra), but if there is [page 77] no provision specifically regulating the case at hand, the gap will iimnediately be filled by principles and rules of the judge-made common law. In this respect it is interesting to note that even a comprehensive statute such as the United States Uniform Commercial Code, which aims at codifying existing American law on commercial transactions, expressly provides that «[u]nless displaced by the particular provisions of this Act, the principles of [common] law and equity, including the law merchant ... shall supplement its provisions» (§ 1-103).

Article 7(2) of this Convention, like Article 17 of ULIS, is clearly modelled on similar provisions in the Codes of the civil law systems. Nor could it be otherwise. The Convention represents a veritable codification of the law on international sales contracts, intended to replace with respect to the matters governed by it the existing domestic laws, whether they are embodied in statutes or developed by case law. If there are gaps, it is only logical to try to find a solution whenever possible within the Convention itself, either by means of an analogical application of its specific provisions or on the basis of the general principles underlying the uniform law as a whole. The Convention permits both methods. The formula used in Article 7(2) is to be understood in a broad sense to cover not only recourse to, «general principles», but also reasoning from specific provisions by analogy. The two approaches should however not be confused, since they are complementary to each other and operate in a different manner.

               2.3.2.1. - In the case of a gap in the Convention the first attempt to be made is to settle the unsolved question by means of an analogical application of specific provisions. To this effect the discovery of a provision dealing with similar cases is a necessary but not a sufficient prerequisite. In interpreting the analogous provision, one may find that the rule it sets forth is of an exceptional character, i.e., was deliberately restricted to a particular factual situation, so that any extension of it to situations not expressly envisaged would be contrary to the intention of the drafters and/or the purpose of the rule in itself («argumentum a contrario»). For instance, Article 49(1)(b) provides that, if the seller does not deliver the goods within the additional period of time fixed by the buyer in accordance with Article 47(1) or declares [page 78] that he will not deliver within the period so fixed, the buyer may declare the contract terminated even if the seller's failure to perform does not amount to a fundamental breach of contract. Nothing is said with respect to other cases of non-performance, e.g., delivery of goods which do not conform with the contract or are not free from rights of a third party. Yet any extension of the rules established by Article 49(1)(b) to these latter cases would be arbitrary, because there are objective reasons tor limiting the exception from the general rule of Article 49(1)(a) to the case of non-delivery only (see commentary on Article 49, infra, § 1.2.1.3.). .

If, as will normally be the case, no such impediment to a possible application by analogy of the specific provision exists, the next step consists in considering whether the case(s) expressly regulated by it and the case at hand are so analogous that it would be inherently unjust not to adopt the same solution for them («argumentum per analogiam»). As an example, suppose that after the avoidance of the contract the question arises as to where the seller has to make restitution of the price already paid by the buyer. Is it to be done at his own place of business or at the buyer's place of business or somewhere else? The question doubtlessly falls within the scope of the Convention (see Article 81(2)), but is not expressly settled by it. The Convention deals with the place for payment only in connection with the buyer's obligation to pay the price, stating that as a rule payment has to be made at the seller's place of business (Article 57(1)(a)). Since there is no reason to treat the seller, if bound to make restitution of the price already paid, differently from the buyer when fulfilling his original obligation to pay the price to the seller, it seems only logical to apply Article 57(1)(a) accordingly and to conclude that the seller has to make restitution at the buyer's place of business. The situation becomes more complicated if ihe buyer also has to make restitution of the goods already received from the seller. According to Article 81(2), in this case the two parties must fulfil their obligations concurrently. As a consequence the solution may no longer be found in Article 57(1)(a), but instead in Article 57(1)(b) which states that, if payment is to be made against the handing over of the goods or of the documents, the buyer must pay where the handing over takes place. However, at least in the case envisaged in Article 31(c) the result will be the [page 79] same. In other words, the seller is still bound to make restitution of the price at the buyer's place of business since, by analogy to Article 31(c), this is the place where the buyer must hand over to the seller the goods already received (for a similar view, see SCHLECHTRIEM, UN-Kaufrecht, 103; Uniform Sales Law, 108; (with respect to ULIS) WEITNAUER, in DÖLLE, Einheitliches Kaufrecht, 510; but for a different solution, see the Supreme Court of the Federal Republic of Germany, 22 October, 1980, Praxis des Internationalen Privat- und Verfahrensrechts 1981, 113).

               2.3.2.2. - Recourse to «general principles» as a means of gap-filling differs from reasoning by analogy insofar as it constitutes an attempt to find a solution for the case at hand not by a mere extension of specific provisions dealing with analogous cases, but on the basis of principles and rules which because of their general character may be applied on a much wider scale (for a clear distinction between the two approaches in the context. of a uniform law, see KROPHOLLER, Internationales Einheitsrecht. Allgemeine Lehren. Tübingen (Mohr), 1975, 292 et seq.).

Some of these principles are expressly stated in the Convention. This is the case, for example, of the principle of good faith referred to, although in a rather unusual context, in Article 7(1) (see § 2.4., infra),. the principle of the parties' autonomy (Article 6), the rule that the agreement between the parties is not subject to any formal requirement (Articles 11 and 29(1)), the principle according to which any notice or other kind of communication made or given after the conclusion of the contract becomes effective on dispatch (Article 27) and the rule that delay in payment creates an obligation to pay interest on the sum in arrears (Article 78).

For the most part, however, the principles must be extracted from provisions of the Convention dealing with specific issues. To this effect, the particular rules they establish must be analysed in order to see whether they can be considered as an expression of a more general principle, as such capable of being applied also to cases different from those specifically regulated. Thus, on several occasions the Convention refers to the parties as «reasonable» persons (see e.g., Articles 8(2) and (3); 25; 35(1)(b); 60; 72(2); 75; 77; 79(1); 85; 86; 88(2)), requires that a particular act must be accomplished or a notice given within a «reasonable» time (see e.g., Articles 18(2); 33(3), 39(1); 43(1); 47; [page 80] 49; 63; 64; 65; 73(2)) and distinguishes between «reasonable» and «unreasonable» expense, inconvenience or excuse (see e.g., Articles 34; 37; 48; 87; 88(2) and (3)). These references demonstrate that under the Convention the «reasonableness» test constitutes a general criterion for evaluating the parties' behaviour to which one may resort in the absence of any specific regulation. There are still other «general principles» which may be deduced from the individual articles of the Convention. For instance, the rule which bars a party from contradicting a representation on which the other party has reasonably relied (see Articles 16(2)(b); 29(2)); the so-called favor contractus, which means that, whenever possible, a solution should be adopted in favour of the valid existence of the contract and against its premature termination on the initiative of one of the parties (see Articles 19(2); 25-26; 34; 37; 48; 49; 51(1); 64; 71-72); the rule according to which each party is bound to cooperate with the other to the extent that such cooperation is necessary in order to enable that other party to properly perform his contractual obligations (see Articles 32(3); 48(2); 60(a); 65); and the rule that a party who relies on a breach of contract must take reasonable measures to mitigate the loss resulting from the breach (see Articles 77; 85-88) (for further details on some of these principles, see HONNOLD, Uniform Law, 129-132; 219; 417-425).

There are principles, such as that of the autonomy of the parties or the «dispatch» rule, which can be directly applied, while others, such as the principle of good faith or the «reasonableness» test, will normally have to be further specified in order to offer an adequate solution for a particular case. With respect to this latter category of principles the question arises as to the standards to be used for the purpose of their specification. The answer should be in the sense of what has already been said with respect to the interpretation of the Convention in general (see § 2.2., supra). In other words, just as in interpreting specific terms and concepts adopted in the text of the Convention, also in specifying «general principles» courts should, in accordance with the basic criteria of Article 7(1), avoid resorting to standards developed under their own domestic law and try to find the particular solution «autonomously», i.e., within the Convention itself, or, should this not be possible, by using standards which are generally accepted at a comparative level. Thus, in applying [page 81] for instance the «reasonableness» test in order to determine whether a party in a particular circumstance has been (reacting with due diligence, a judge of a highly industrialized country may not automatically refer to the standards of care and professional skill normally required from national business people in domestic affairs. The answer should be found either in the Convention itself or at least on the basis of standards which are currently adopted also in other legal systems.

          2.3.3. - As a last means of gap-filling, Article 7(2) expressly mentions recourse to «the law applicable by virtue of the rules of private international law». Two important conclusions may be drawn from this provision.

               2.3.3.1. - On the one hand, it is clear that the idea of the Convention being a self-contained body of rules independent of and distinct from the different domestic laws is not an absolute one. With respect to ULIS it was already questioned whether turning to domestic law should be permitted if a gap could not be filled by general principles which could be extracted from the uniform law itself. The prevailing view was opposed to this approach. It was argued that in such a case the solution should be found on the basis of principles and rules which are most commonly adopted within the different Contracting States and/or particularly suited for the case at hand (see DÖLLE, Art. 17 des Einheitsgesetzes, 144, et seq.; ZWEIGERT-DROBNIG, Einheitliches Kaufgesetz, 150; MERTENS-REHBINDER, Internationales Kaufrecht, 141; WAHL, in DÖLLE, Einheitliches Kaufrecht, 139 et seq.). The minority however, objected that courts, when asked to settle a particular dispute, could hardly be expected to succeed in finding a generally acceptable solution after so many specialists in prolonged deliberations during the preparation of the uniform law apparently failed to do so. Moreover, the result would in any event be great uncertainty concerning the final decisions in each case (see KROPHOLLER, Der «Ausschluss» des IPR, 380 et seq.). Under the new Convention there is no basis for the dispute. Regrettably for those who believe that the unification process, initiated with the adoption of the uniform law, should not be prevented from being further developed by international case-law (see BONELL, Some Critical Reflections, 7 et seq.), both the [page 82] legislative history and the wording of Article 7(2) show that recourse to domestic law for the purpose of filling in gaps under certain circumstances is not only admissible, but even obligatory.

               2.3.3.2. - Yet there is still another important aspect of this provision which should not be overlooked. By stating that unsolved questions are to be settled «in conformity with the general principles on which [the Convention] is based or, in the absence of such principles, in conformity with the law applicable by virtue of the rules of private international law» (emphasis added), it is made clear that recourse to domestic law also represents under the new uniform law a last resort to be used only if and to the extent that a solution cannot be found either by analogical application of specific provisions or by the application of «general principles» underlying the uniform law as such. Maybe this goes without saying for lawyers from civil law systems, who are accustomed to the idea that, before turning to an external source to fill in gaps of a statute, every attempt should be made to find a solution within the statute itself (see § 2.3.2., supra). But for courts of countries where this is not the current approach, it is essential to bear in mind that, when faced with a case not specifically regulated by the Convention, they may not immediately turn to domestic law, but are bound to try to find a solution above all on the basis of the other criteria indicated in Article 7(2).

               2.3.3.3. - The domestic law which is eventually to be chosen for the purpose of filling in the gap is «the law applicable by virtue of the rules of private international law». Accordingly, depending on the kind of question to be solved, the applicable law will be either the law which in the absence of the Convention would have governed the sales .contract or some other law referred to by the competent conflict-of-law rules.

     2.4. - Article 7(1) second part, which states that «[i]n the interpretation of this Convention regard is to be had ... to the need to promote ... the observance of good faith in international trade»; is a rather peculiar provision. As the legislative history shows (see § § 1.5. and 1.7., supra), it represents a hard-won compromise solution between those who would have preferred a provision imposing directly on the parties the duty to act in good faith, and those who [page 83] on the contrary were opposed to any explicit reference to the principle of good faith in the Convention. Yet what does it mean that such a reference now appears in the context of a provision dealing with the interpretation of the Convention as such? And how is it to be understood that the need to observe good faith has been further qualified by the additional words «in international trade»?

          2.4.1. - As to the first question there are those who insist on the literal meaning of the provision and conclude that the principle of good faith is nothing more than an additional criterion to be used by judges and arbitrators in the interpretation of the Convention (see FARNSWORTH, The Perspective of the Common Law Countries, 18, who speaks of «seemingly harmless words»; WINSHIP, International Sales Contract, 67; also EÖRSI, The 1980 Vienna Convention, 349, who is of the opinion that the provision as it now stands represents «a strange compromise, in fact burying the principle of good faith»). Others, moving from a broader interpretation of the reference to good faith as contained in Article 7(1), point out that «the need to promote ... the observance of good faith in international trade» is also necessarily directed to the parties to each individual contract of sale (see ROSETT, Critical Reflections, 290; in substance see also HONNOLD, Uniform Law, 124-125; SCHLECHTRIEM, UN-Kaufrecht, 25; Uniform Sales Law, 39; MASKOW, The Perspective of the Socialist Countries, 54-57).

Of the two opinions the latter is preferable. Indeed, even as a simple aid to the interpretation of the Convention's specific provisions the principle of good faith may have some impact on the behaviour of the parties. It has been rightly observed (HONNOLD, Uniform Law, 125) that, for instance, a party who demands performance within an additional period according to Articles 47 or 63 may not, in good faith, refuse to accept the performance that he requested. Similarly, compelling specific performance or avoiding a contract after a market change that permits a party to speculate at the other's expense, may well be inconsistent with the Convention's provisions governing these remedies, when they are construed in the light of good faith. Other examples of cases where in particular circumstances a party is prevented from invoking rights and remedies normally granted to him under the Convention could be added. Even contractual agreements or usages might be disregarded if their application in accordance [page 84] with Articles 6 and 9 of the Convention would in the specific case appear to be contrary to good faith (see commentary on Article 9, infra. § 3.4.2.).

Yet, notwithstanding the language used in Article 7(1), the relevance of the principle of good faith is not limited to the interpretation of the Convention. There are a number of provisions (see Official Records, I, 18, where the Secretariat's Commentary makes reference among others, to Articles 14(2)(b), 19(2), 27(2), 35 and 44, 38, 45(2), 60(2) and 67, and 74 to 77) which constitute a particular application of this principle, thus confirming that good faith is also one of the «general principles» underlying the Convention as a whole. As such it may even impose on the parties additional obligations of a positive character. This will be the case, if during the negotiating process or in the course of the performance of the contract a question arises for which the Convention does not contain any specific provision and the solution is found in applying, in accordance with Article 7(2), the principle of good faith.

          2.4.2. - One of the main objections to the inclusion in the Convention of a provision imposing on the parties a general obligation to act in good faith was that this concept was too vague and would inevitably have led to divergent interpretations by national courts (see § 1.5., supra). There is indeed, at least at first sight, a great variety of ways in which the principle of good faith traditionally operates within the different national legal systems (see, also for further references, NEWMAN, The General Principles of Equity, in Newman (ed.), Equity in the World's Legal Systems. A Comparative Study, Brussels (Bruylant), 1973, 589 et seq.). Sometimes its relevance is formally limited to performance of the contract (see., e.g., § 1-203 of the United States Uniform Commercial Code which provides that «every contract or duty within this Act imposes an obligation of good faith in its performance or enforcement»; for some significant instances, however, in which United States courts have imposed on the parties also a «duty to bargain in good faith.» see FARNSWORTH, Contracts, Toronto-Boston (Little, Brown & Company), 1982, 187 et seq.). Yet even where, as in most of the civil law systems, the principle as such is expressly stated with respect not only to performance but also to formation and interpretation of the contract [page 85] (see, e.g., §§ 157 and 242 of the Federal Republic of Germany Civil Code; Articles 1337-1338, 1366 and 1375 of the Italian Civil Code; Articles 6.1.1.2.1., 6.5.3.1.1. and 6.5.3.1.2. of the Dutch Civil Code) its specific applications in practice may differ considerably. It is sufficient to recall the impressive amount of case law developed by German .Courts in application of § 242 of the Civil Code and concerning such important issues as, for example, culpa in contrahendo, abuse of rights, hardship and unconscionable contract terms, and to compare it with the relatively modest role which similar provisions have so far played in the judicial practice of other countries.

By referring to «good faith in international trade» Article 7(1) makes it clear, first of all, that in the context of the Convention the principle of good faith may not be applied according to the standards ordinarily adopted within the different national legal systems. To be more precise, and as has already been said in connection with the specification of the principles underlying the Convention in general (see § 2.3.2., supra), such national standards may be taken into account only to the extent that they prove to be commonly accepted at a comparative level. Take, for instance, the rule first developed by. German courts and more recently accepted in substance also in a number of other continental systems, according to which between merchants the recipient of a written communication, claiming to constitute a simple confirmation of the prior oral agreement between the parties, but in fact containing additional or different terms, is under a duty immediately to object to these terms if he does not want to be bound by them (see SCHLESINGER; Formation of Contracts, II, Dobbs Ferry, N. Y. (Oceana), 1968, 1160 et seq. (Report on Austrian, German and Swiss law)). In view of. the fact that in other legal systems such a rule is either entirely unknown (see SCHLESINGER, op. cit., 1120 (Report on English, Australian, Canadian and New Zealand law); 1173 et seq. (Report on Indian law)) or limited to the case in which the additional or different terms do not materially alter the content of the earlier agreement (see, e.g., § 2-207(2) of the United States Uniform Commercial Code), it is highly unlikely that it could ever be applied to a contract of sale governed by the Convention. At the most it may be invoked by the sender of the written communication if he proves that a similar application of the principle of good faith is generally [page 86] accepted not only in his own country but also in the country where the recipient has his place of business (for this solution in respect to international transactions in general see, with further references to German case law, BONELL, Das autonome Recht des Welthandels, in RabelsZ, 42 (1978) 485 et seq).

A further implication of the formula used in Article 7(1) is that in the context of the Convention the principle of good faith must be construed in the light of the special conditions and requirements of international trade. In the application of this principle domestic laws also generally distinguish contracts between merchants from so-called consumer transactions. For instance, rules intended to protect the economically weaker or inexperienced party are for the most part excluded, when both parties contracted in their professional capacity (see § 1 of the 1971 Swedish Act on Unfair Contract Terms; §§ 2, 10-12 of the 1976 Federal Republic of Germany Act on Standard Forms of Contract; Sections 3, 5-7 of the 1977 United Kingdom Unfair Contract Terms Act). On the other hand, in the case of a transaction between merchants the general obligation to act in good faith is often understood in the sense of imposing special standards, such as «the observance of reasonable commercial standards of fair dealing» (so literally § 2-103(b) of the United States Uniform Commercial Code; for a similar provision see also; e.g., Article 23(1) of the Czechoslovakian International Trade Code). There exist however substantial differences between transactions of a purely domestic nature and transactions concluded at an international level. In the case of a contract of sale entered into by an exporter from a highly industrialized country and an importer from a developing country it may well be that the discrepancy between the bargaining power of the two parties corresponds to that normally to be found in a consumer transaction stipulated at national level. On the other hand, the current standards of business practice are far from being uniform in different parts of the world, so that a particular line of conduct, which may reasonably be expected from merchants operating in the same country or region, could hardly be imposed on a party belonging to a country with a different economic and social structure. It follows that the distinction generally made within domestic laws between consumer transactions and contracts of a commercial nature is only one of the criteria to be used in order to determine the precise [page 87] meaning of «good faith in international trade». Other, and certainly more illuminating indications may be found in the Convention itself, including the Preamble which expressly states that «the development of international trade on the basis of equality and mutual benefit is an important element in promoting friendly relations among States», and that «the adoption of uniform rules which ... take into account the different social, economic and legal systems would contribute to the removal of legal barriers in international trade and promote the development of international trade».

3. Problems concerning the provision.

     3.1. - Accepting the idea that due to its international origin and nature the Convention is to be interpreted differently from ordinary domestic legislation is only a pre-condition for its uniform application in practice. There still remains the possibility that the Convention, even if considered as an autonomous system of law, will be given divergent interpretations in the various couritries.

          3.1.1. - In theory there exists a wide range of remedies against such a risk (DAVID, op. cit., 107-122). The most radical one would be to give an international tribunal competence to make preliminary rulings on questions arising out of the interpretation of the Convention, while at the same time requiring national courts to suspend their decisions until after the judgment of this tribunal and then to decide in accordance with that judgment. A procedure of this kind exists within the European Communities, where the European Court of Justice has been given the competence to render at the request, which sometimes may be obligatory, of national courts binding decisions on interpretation questions relating to Community law in the narrow sense (see Article 177 of the Treaty of Rome setting up the European Economic Community) as well as to international conventions concluded between the Member States, such as the 1968 Brussels Convention on Jurisdiction and the Enforcement of Judgments in Civil and Commercial Matters (see the 1971 Protocol on the Interpretation of the 1968 Convention by the European Court). [page 88]

Although this interpretation system has so far produced very satisfactory results, a similar solution can hardly be conceived with respect to the present Convention. This Convention, like other international conventions elaborated under the auspices of the United Nations or other international organizations, such as UNIDROIT, the Hague Conference on Private International Law, etc., is not restricted to a particular regional area, but is intended to receive a world-wide acceptance. To expect that all adhering States, notwithstanding their different social, political and legal structure, could even agree on conferring to an international tribunal the exclusive competence to resolve divergencies between the national jurisdictions in the interpretation of the uniform rules, would be entirely unrealistic. Moreover, because disputes arising in connection with international sale contracts are frequently decided by arbitration, there would remain the problem of how to ensure that private arbitrators, when faced with a question of the Convention's interpretation, would submit the case to such a hypothetical international tribunal.

          3.1.2. - A less ambitious solution would be to entrust an international organ, whether a court or a particularly qualified international organization, with the limited task of rendering advisory opinions concerning the proper interpretation to be given to the Convention. Such a consultative procedure could be envisaged not only where a dispute has already arisen, but also in a general and abstract context. In the former case it would be up to the judge or the arbitrator and/or the parties themselves to take the initiative, while in the latter the request for clarification could be made by national authorities desiring to ensure a correct application of the Convention within their State. Here too there are some significant precedents. For example, in one form or another the International Labour Office, the Council of the International Civil Aviation Organisation and the Central Office for International Road Transport carry out advisory functions with. respect to the application of the uniform laws elaborated under their auspices. At the eighteenth session of UNCITRAL, the Secretariat submitted a note discussing the possibility of establishing a similar procedure for existing UNCITRAL legal texts including this Convention (see A/CN.9/287 of 21 February 1985). There are, however, a number of objections which can be [page 89] raised against such a proposal. First of all, who should authorize the Commission to give its opinions on instruments such as the present Convention which have been adopted in final form not by the Commission itself, but by a diplomatic conference to which all Member States of the United Nations have been invited? Furthermore, would the decisions be rendered by the Commission as a whole at its annual sessions or should a permanent committee, composed of a restricted number of Commission members be set up for this purpose? In any event, would it be appropriate to entrust with such an important and politically controversial task an organ composed of representatives of States?

          3.1.3. - In practice it will be essentially up to national judges and arbitrators called upon to interpret the Convention in a given case, to ensure to the widest possibile extent its uniform application. There are however some interpretative aids which may help them in fulfilling this difficult task.

Above all, the existence of several equally authentic language versions of the Convention permits, in case, of ambiguities or obscurities in one language text, to look at the others in order to see whether they present the same difficulties of understanding. Such a comparison even becomes obligatory, if the text actually applied is only a translation into a national language which is not one of the official languages of the United Nations. Another useful guide is the legislative history of the Convention.

Possible doubts about the precise meaning and effect of a single provision may well be resolved by reference to the travaux préparatoires which include not only the acts and proceedings of the Vienna Conference, but also the summary records of the previous deliberations within UNCITRAL. The value of legislative history should however not be overestimated (see DAVID, op. cit., 105; HONNOLD, Uniform Law, 119). Sometimes the preparatory materials reveal a difference of opinion among the drafters themselves, and even when the arguments put forward in favour of the adoption of a given provision were not controversial, they are not necessarily decisive. Once adopted the Convention, like any other law, has a life of its own, and its meaning can change with time so that the intention of the drafters is only one of the elements to be taken into account for the purpose of its interpretation. [page 90]

The most effective means of ensuring uniformity in the application of the Convention consists in having regard to the way in which it is interpreted in other countries. A particular question of interpretation may already have been brought to the attention of foreign courts or examined in detail by scholarly writings. A judge or arbitrator faced with the same issue should in any event take into consideration the solutions so far elaborated in other Contracting States. If there is already a body of international case law, it may well be accepted as a sort of binding precedent. Otherwise, the reasoning of the different decisions of scholarly writings should be given at least some persuasive value (for examples of court decisions in the United States, United Kingdom, Switzerland, Federal Republic of Germany, Belgium, Austria and Italy, which for the interpretation of existing uniform laws relied, although to a different extent, on foreign case law and scholarship, see GILES, Uniform Commercial Law. An Essay on International Conventions in National Courts, Leyden (A.W. Sijthoff), 1970, 35 et seq.; BONELL, Some Critical Reflections, 11).

In practice this approach may encounter difficulties resulting from the insufficient dissemination of judicial decisions relating to the Convention. There are international organisations, such as the International Labour Office or the United International "Bureaux for the Protection of Intellectual Property, which with respect to the existing uniform laws in labour law or copyright, patent and trade mark law provide centralized dissemination of decisions rendered in the Contracting States (for more detailed information see, DAVID, op. cit., 109, et seq.). In a less systematic way UNIDROIT has recently been publishing in its «Uniform Law Review», in addition to other selected law cases, the most significant decisions relating to ULIS and ULFC. With respect to the present Convention UNCITRAL is examining the possibility of establishing a procedure whereby each Contracting State would be requested to provide the Secretariat with decisions of its own courts. The Secretariat would then be able to select and publish them, perhaps in summarized form in all official languages of the United Nations. The reports would then be distributed through the usual channels to all governments as well as to United Nations depository libraries and other recipients world-wide (see the already mentioned note of the Secretariat: A/CN.9/287, paragraphs 4-7). [page 91]

It is hoped that, even if this project turned out to be too ambitious, at. least in the near future, other initiatives will be taken, either within an international framework or on a private basis with a view to providing an adequate collection and dissemination of the international case law that will develop under this Convention.

     3.2. - A judge or arbitrator faced with a question of interpretation of the Convention may discover that in respect of that question divergent solutions have been adopted by the different national courts. As long as the conflicting decisions are rather isolated and rendered by courts of first instance, or the divergencies are to be found even within one and the same jurisdiction, it is still possible either to choose the most appropriate solution among the different ones so far proposed or to disregard them altogether and attempt to find a new solution. However, what if on the contrary the contrast exists between the various jurisdictions, in the sense that courts in States A and B are firmly committed to solution X, whereas courts in States C and D constantly favour solution Y? May one still insist on the necessity to interpret the Convention «autonomously» or does it in such a case become inevitable to make a choice between the different «national» interpretations and if so, which of them should prevail?

The question has been extensively discussed with reference to the 1930 Geneva Uniform Law on Bills Exchange and Promissory Notes, when it became apparent that one of its provisions (Article 31(4)) gave rise to differences of interpretation between various national jurisdictions. In applying the provision to bills of exchange drawn in their own country but payable in a foreign State, both French and German courts rejected the idea of an «autonomous» solution and referred to the interpretation usually given to the provision within the legal system which in each case was competent according to the rules of private international law of the forum. The decisions were heavily criticized on the ground that «in fields where uniform laws exist, and in dealings between States which have adopted these uniform laws; there is no longer a place for the application of the conflict-of-laws approach» (DAVID, op. cit., 103). This opinion is questionable. Despite the necessity to interpret uniform laws «autonomously» in general [page 92] (see § 2.2.2., supra), an exception must be made if it turns out that with respect to a particular provision there exists an insuperable conflict of interpretation between the Contracting States. To insist even in such an hypothesis on an «autonomous» approach seems to be unrealistic, and in practice the result could easily be the opposite of what was desired, that is to say that courts in each country could feel free to apply their own «national» interpretations irrespectively of the circumstances of the single case. It is much better to acknowledge that with respect to the specific issue the uniform law failed, at least for the time being, to bring about uniformity in the laws of the Contracting States, and to accept as the only possibile remedy the recourse to the traditional conflict-of-laws approach. After all, by applying the interpretation prevailing within the State the law of which would govern the transaction in the absence of the uniform law, it may be hoped that the solution will be the same irrespective of the forum chosen by the parties (see for a similar view, with further references, KROPHOLLER, op. cit., 204 et seq.).

     3.3. - According to Article 6 the parties may exclude the application of the Convention or, subject to Article 12, derogate from or vary the effect of any of its provisions. Does this mean that parties to a contract of sale governed by the Convention may exclude the application of Article 7? The question is not only a theoretical one. It is quite possibile that businessmen, especially those from common law countries where statutory law is traditionally interpreted in a strict sense and supplemented by principles and rules taken from case law, prefer to have the same approach adopted also with respect to the Convention or at least to leave it to the discretion of the competent court how to apply the new instrument.

There is a strong argument for the negative. Any legislation has to be interpreted in accordance with the criteria specifically laid down in it or generally adopted within the legal system from which it emanates. The parties to an international sales contract are free to choose between the application of the Convention and the application of a particular domestic law. Once they have accepted that their contract be governed by the Convention, the Convention must be applied, in accordance with the interpretation established in Article 7. It has been pointed out that these rules [page 93] take account of the fact that the Convention, even after its incorporation into the various national legal systems, remains an autonomous body of law, intended to replace all the rules previously governing matters within its scope, whether deriving from statute or from case law (see § 2.2.1, supra). To permit the parties to derogate from Article 7 by agreeing on rules of interpretation used with respect to ordinary domestic legislation would be inconsistent with the international character of the Convention and would necessarily seriously jeopardize the Convention's ultimate aim, which is to achieve worldwide uniformity in the law of international contracts of sale and to promote the observance of good faith in international trade. [page 94]


Pace Law School Institute of International Commercial Law - Last updated January 10, 2005
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