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Cite as Date-Bah, in Bianca-Bonell Commentary on the International Sales Law, Giuffrè: Milan (1987) 319-321. Reproduced with permission of Dott. A Giuffrè Editore, S.p.A.

Article 42

Samuel K. Date-Bah

1. History of the provision
2. Meaning and purpose of the provision

ARTICLE 42

(1) The seller must deliver goods which are free from any right or claim of a third party based on industrial property or other intellectual property, of which at the time of the conclusion of the contract the seller knew or could not have been unaware, provided that the right or claim is based on industrial property or other intellectual property:
(a) under the law of the State where the goods will be resold or otherwise used, if it was contemplated by the parties at the time of the conclusion of the contract that the goods would be resold or otherwise used in that State; or
(b) in any other case, under the law of the State where the buyer has his place of business.

(2) The obligation of the seller under the preceding paragraph does not extend to cases where:
(a) at the time of the conclusion of the contract the buyer knew or could not have been unaware of the right or claim, or
(b) the right or claim results from the seller's compliance with technical drawings, designs, formulae or other such specifications furnished by the buyer.

1. History of the provision

     1.1. - This article has the same history as Article 41 (see commentary on Article 41, supra).

2. Meaning and purpose of the provision

     2.1. - This Article lays down the general rule that the seller must deliver goods which are free from any right or claim of a third party based on industrial property or other intellectual property. However, this general rule is qualified by restricting the [page 319] seller's obligation in the following manner. The seller must deliver goods free from any right or claim of a third party based on industrial or other intellectual property, only if such right or claim is based on a legal system which was, broadly speaking, within the contemplation of the seller. Such legal systems are specified as follows: (a) the law of the State where the goods are to be resold or otherwise used, if it was contemplated by the parties at the time of the conclusion of the contract that the goods would be resold or otherwise used in that State; (b) alternatively, the law of the State where the buyer has his place of business.

     2.2. - The justification for dealing differently with third party claims and rights based on industrial property is, as observed by one delegation at the Vienna Conference, that rights or claims based on intellectual or industrial property constitute a separate case. With regard to the rights mentioned in Article 39 (now Article 41 of the Convention) the seller might have no difficulty in knowing what they were, but that did not apply to the rights referred to in Article 40 (now Article 42 of the Convention). That was why separate articles had been drafted to deal with those questions (Official Records, II, 324).

Intellectual property rights in particular goods are rights which may be protected in one legal system, but not in another, depending upon whether the person claiming protection has complied with national regulations for registration and other such requirements. This fact makes it difficult for a seller to guarantee worldwide that his goods do not infringe, for instance, any patent rights in any country. To illustrate, there may be a country whose patent legislation allows the patenting of inventions which can be regarded as novel only in the national context, but not by international standards or the state of the art in some developed countries.

Under such legislation, one is likely to have a situation in which an international seller may have sold goods produced by a process which has fallen into the public domain under the law of his country, but which was still protected in the hypothetical State X referred to above. Such an international seller would be liable for a patent infringement under the law of this hypothetical country. The policy of this provision appears to be that it would be too onerous to make such a seller indemnify the buyer against [page 320] such breach of patent, unless the seller could foresee that the buyer of his goods was likely to introduce them into State X.

     2.3. - The Committee noted that two main objectives guided the Special Working Group which drafted the original version of this article. These objectives were:

... to define the limits of the seller's responsibility to supply goods which were free from any right or claim of a third party based on industrial or intellectual property. The objective was achieved by making the seller responsible for those rights or claims of which, at the time of the conclusion of the contract, he knew or could not have been unaware. The second objective was to indicate which industrial or intellectual property laws were relevant in determining whether the seller had breached his obligation to supply goods free from the industrial or intellectual property rights or claims of a third party. This was achieved by selecting the law of the State where the goods would be used, if the use in that State was contemplated by the parties at the time of the conclusion of the contract or, in any other case, under the law where the buyer had his place of business (Yearbook, VIII (1977), 40). [page 321]


Pace Law School Institute of International Commercial Law - Last updated January 31, 2005
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