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Reproduced with permission from the Cornell Review of the Convention on Contracts for the International Sale of Goods (1995) 51-94

Judicial Interpretation and Application of the CISG in Germany 1988-1994

Martin Karollus [*]

INTRODUCTION

From the very beginning, Germany has played a major role in the unification of international sales law.[1] In fact, it was a German professor of law, Ernst Rabel, who first proposed preparatory studies for a future uniform law. Rabel heavily influenced the first draft proposals made under the direction of the International Institute for the Unification of Private Law (UNIDROIT) and, above all, he laid the foundations for the uniform law with his comparative studies on the national sales laws.[2] Decades later, the Federal Republic of Germany (FRG) joined the first international sales law conventions. The Federal Republic was a member of ULIS and ULF [3] from 1974 until 1990.

The FRG has been a CISG Member State since January 1, 1991.[4] The FRG adopted the CISG without reservation but made the following declaration concerning Articles 1(1)(b) and 95:

The Government of the Federal Republic of Germany holds the view that Parties to the Convention which have made a declaration under article 95 of the Convention are not to be considered Contracting States within the meaning of subparagraph (1)(b) of article 1 of the Convention. Accordingly, there is no obligation to apply -- and the Federal Republic of Germany assumes no obligation to apply -- this provision when the rules of private international law lead to the application of the law [page 51] of a Party which has made a declaration to the effect that it will not be bound by subparagraph (1)(b) of article 1 of the Convention. Subject to this observation the Government of the Federal Republic of Germany makes no declaration under article 95 of the Convention.[5]

This declaration was explicitly adopted into German national law.[6] Therefore, a German court may not apply Article 1(1)(b) if, for example, the law of the United States is applicable.[7]

The former German Democratic Republic (GDR) became a CISG Member State on March 1, 1990. However, GDR membership was short; on October 3, 1990, the GDR ceased to exist and its territorial units became parts of the FRG. This created problems as the CISG was applicable in the former GDR from March 1, 1990, until October 2, 1990. For example, if a merchant located in Leipzig (former GDR) sold tools in July of 1990 to a merchant in Budapest,[8] the CISG would be applicable. The CISG does not apply to a similar contract made at the same time if the seller was located in Köln (FRG), since the FRG did not become a CISG Member State until January 1, 1991.

There is much controversy about whether the CISG was applicable in the former GDR from October 3, 1990, to December 31, 1990. Some authors have argued that, even though the GDR ceased to exist on October 3, 1990, the CISG was applicable in the former states of the GDR [9] because these states continued to exist.[10] However, most scholars disagree and assert that CISG membership, and therefore CISG applicability in the states of the former GDR, terminated with the GDR.[11] Surprisingly, no court has considered this issue.

I. GERMAN LITERATURE ON THE CISG

German lawyers take the CISG very seriously. Since the early 1980s, many books and articles on the CISG have been written.[12] The major German-language books (including Austrian and Swiss books) are: [page 52]

A. Commentaries

     Ernst von Caemmerer & Peter Schlechtriem, Kommentar zum Einheitlichen UN-Kaufrecht [13]

     Fritz Enderlein, Dietrich Maskow & Monika Stargardt, Kaufrechtskonvention der UNO (mit
     Verjährungskonvention)
[14]

     Fritz Enderlein, Dietrich Maskow & Ernst Strohbach, Internationales Kaufrecht [15]

     Rolf Herber & Beate Czerwenka, Internationales Kaufrecht [16]

     Roland Loewe, Internationales Kaufrecht [17]

     Ulrich Magnus, UN-Kaufrecht [18]

     Gert Reinhart, UN-Kaufrecht [19]

B. Monographs

     Martin Karollus, UN-Kaufrecht [20]

     Burghard Piltz, Internationales Kaufrecht [21]

     Peter Schlechtriem, Einheitliches UN-Kaufrecht [22]

     Georg Wilhelm, UN-Kaufrecht [23]

C. Symposia

     Eugen Bucher, Wiener Kaufrecht [24]

     Peter Doralt, Das UNCITRAL-Kaufrecht im Vergleich zum österreichischen Recht [25]

     Hans Hoyer & Willibald Posch, Das Einheitliche Wiener Kaufrecht [26]

     Peter Schlechtriem, Einheitliches Kaufrecht und nationales Obligationenrecht [27] [page 53]

II. GERMAN COURT DECISIONS ON THE CISG

Although the CISG has only recently come into force, it has figured prominently before German courts. Through 1994, twenty-three decisions have been published:[28]

     1. Judgment of July 3, 1989, LG München I [29]

     2. Judgment of Aug. 31, 1989, LG Stuttgart [30]

     3. Judgment of Apr. 3, 1990, LG Aachen [31]

     4. Judgment of Apr. 24, 1990, AG Oldenburg in Holstein [32]

     5. Judgment of Sept. 26, 1990, LG Hamburg [33]

     6. Judgment of Jan. 31, 1991, AG Frankfurt am Main [34]

     7. Judgment of June 13, 1991, OLG Frankfurt am Main [35]

     8. Judgment of Aug. 14, 1991, LG Baden-Baden [36]

     9. Judgment of Sept. 16, 1991, LG Frankfurt am Main [37]

     10. Judgment of Sept. 17, 1991, OLG Frankfurt am Main [38]

     11. Judgment of Nov. 20, 1992, OLG Karlsruhe [39]

     12. Judgment of Jan. 8, 1993, OLG Düsseldorf [40]

     13. Judgment of May 14, 1993, LG Aachen [41]

     14. Judgment of July 2, 1993, OLG Düsseldorf [42]

     15. Judgment of Sept. 17, 1993, OLG Koblenz [43]

     16. Judgment of Jan. 18, 1994, OLG Frankfurt am Main [44]

     17. Judgment of Jan. 24, 1994, KG Berlin [45]

     18. Judgment of Feb. 10, 1994, OLG Düsseldorf [46]

     19. Judgment of Feb. 10, 1994, OLG Düsseldorf [47]

     20. Judgment of Feb. 22, 1994, OLG Köln [48]

     21. Judgment of Mar. 2, 1994, OLG München [49]

     22. Judgment of Apr. 20, 1994, OLG Frankfurt am Main [50]

     23. Judgment of July 13, 1994, LG Frankfurt am Main [51] [page 54]

This list contains only published decisions. There are other decisions which were not published,[52] but they are not discussed in this Article. Since arbitral awards generally are not published, it is not known whether a German arbitral tribunal has considered the CISG.[53]

Each decision's importance depends primarily on the rendering court's position in the German legal hierarchy. Therefore, a brief examination of the German judicial system is appropriate.

The lowest court is the Amtsgericht (AG). In 1990, there were 551 Amtsgerichte in the Federal Republic of Germany.[54] The Amtsgerichte have jurisdiction over minor cases (generally, disputes up to DM 10,000) and always decide at first instance.

The Landgericht (LG) decides major cases (disputes over DM 10,000) at first instance and serves as an appellate court from the Amtsgericht. In 1990, there were ninety-four Landgerichte in the FRG.

The Oberlandesgericht (OLG) is generally the appellate court from the Landgericht. In 1990, there were nineteen Oberlandesgerichte in the FRG. The Kammergericht (KG) Berlin is one of them but has a different name for historical reasons. In many cases, the OLG has final appellate jurisdiction. For this reason, OLG decisions are rather influential.

The highest civil court is the Bundesgerichtshof (BGH), located at Karlsruhe. The Bundesgerichtshof is the court of last resort in the FRG for civil matters.[55] However, an appeal to the Bundesgerichtshof is possible only under special circumstances.[56]

At the time this Article was written, the BGH had not made a decision relating to the CISG. In 1995, the BGH decided twice under the CISG.[57]

The remainder of this Article examines some of the more important statements made by German courts regarding the CISG.[58] The purpose of this examination is to relate the basic principles and law that govern German application of the CISG. This information should be of special interest to those readers engaged in trade with Germany, as it is crucial that they know how the CISG is interpreted by German courts. [page 55]

In addition, the Convention calls for uniform interpretation and application.[59] Since the unification of sales laws is only possible if lawyers around the world are willing to learn about CISG application in other countries, this Article will hopefully initiate a world-wide discussion. German lawyers are eager to know what foreign lawyers think about the German approach, and they are eager to learn about CISG application in other nations.

III. SPHERE OF APPLICATION (ARTICLES 1-6)

1. Article 1

The CISG entered into force in the FRG on January 1, 1991. For this reason, Part II of the CISG is applicable only to an offer made on or after January 1,1991,[60] and Part III of the CISG is applicable only to a contract concluded on or after January 1, 1991.[61] Consequently, there were few CISG applications under Article 1(1)(a) in 1991 and 1992, but this has changed since 1993.[62]

Nevertheless, in many decisions the CISG was applied to older sales contracts based on Article 1(1)(b).[63] In the absence of a choice of law provision in the contract, the German rules on conflict of laws generally lead to the application of the seller's law.[64] If the seller was from a country which adopted the CISG before 1991 (especially Italy and France), the German courts applied the CISG as part of the seller's law.

However, in one case the court was wrong [OLG Düsseldorf 2 July 1993]. The seller came from Indiana, and the law applicable to the contract was therefore the law of Indiana.[65] The OLG Düsseldorf decided the CISG was applicable, because the United States had been a CISG member since 1988.[66] Unfortunately, the OLG Düsseldorf ignored the fact that the United States had opted out of Article 1(1)(b) by declaration under Article 95.[67]

Generally, the CISG is not dispositive as to whether the courts of a state which has not made a declaration under Article 95 should apply the [page 56] CISG under Article 1(1)(b) as the domestic law of a nation which has opted out of Article 1(1)(b) by declaration under Article 95.[68] In the FRG, this problem has been solved by national statute. According to Vertragsgesetz Article 2, a German court may not apply Article 1(1)(b) if the conflict of laws analysis requires application of the law of a state which has opted out of Article 1(1)(b) by declaration under Article 95.[69] Therefore, the OLG Düsseldorf incorrectly applied the CISG instead of the domestic law of Indiana (presumably the Uniform Commercial Code).[70] It is perhaps not surprising, however, that the court favored application of the more familiar CISG.

Since the German conflict of laws rules concerning sales contracts lead directly to the substantial law (Sachnormverweisung),[71] the problem of renvoi does not arise in German courts.[72] This is notably different under Austrian law, where the rules on conflict of laws lead primarily to the foreign state's rules on conflict of laws (Gesamtverweisung). As Article 1(1)(b) does not exclude the doctrine of renvoi,[73] one Austrian court has dealt with a complicated renvoi problem between Austrian and Italian law [Bezirksgericht für Handelssachen Wien 20 February 1992].[74]

According to Article 1(1), the CISG applies only to the sale of goods. This term has been interpreted broadly -- all items usually objects of trade are goods under the CISG. Therefore, not only the sale of corporal goods is governed by the CISG,[75] but also the sale of software [OLG Koblenz 17 September 1993].[76]

2. Article 3

German courts have applied the CISG via Article 3(1) in three cases involving contracts for the manufacture of goods. In the first case, an Italian manufacturer contracted to produce shoes according to the detailed instructions of the German buyer [OLG Frankfurt 17 September 1991].[77] In the second case, the American manufacturer promised to produce a machine for an industrial plant [OLG Düsseldorf 2 July 1993].[78] In the third case, a French manufacturer of computer printers developed software for the special needs of the buyer [OLG Koblenz 17 September 1993].[79]

None of these contracts are sales contracts under German law because German sales law is applicable only if the goods manufactured [page 57] are generic.[80] If the goods are custom-made, the provisions concerning a Werkvertrag (contract of manufacture) apply.[81]

Nevertheless, the contracts are sales contracts under the CISG; the only distinction made by the CISG concerns the origin of the raw or component materials.[82] Since these materials were not supplied by the buyer, the CISG properly applied.

3. Article 4

According to Article 4, the CISG does not govern questions of contract validity.[83] Therefore, only national law applies to the question of whether the contract is the correct manifestation of the parties' intent.[84] There is, however, much controversy surrounding the treatment of non-conforming goods because the CISG does not expressly exclude consideration of such non-conformity; one could therefore argue that a challenge to contract validity would be possible under national law.[85] Nevertheless, almost all German authors take the view that the CISG precludes a challenge to contract validity based on non-conforming goods.[86] This interpretation is influenced by the fact that a similar preclusion exists under German national law. It is also argued that this interpretation is necessary to ensure uniformity [LG Aachen 14 May 1993].[87]

The LG Aachen interpreted the term "validity" very broadly in a case where contracting parties agreed that the contract was contingent on certain circumstances.[88] In particular, the parties agreed that the contract would become effective only after the buyer had paid for earlier deliveries, which he actually did not. According to the LG Aachen, this contractual provision concerns "validity" under Article 4 and therefore is not governed by the CISG. I do not agree because there is no issue of "validity." The parties simply agreed on a contract term that should have been interpreted according to Article 8.

Apart from these exclusions in Article 4, other issues not governed by the CISG include the legal capacity of corporations [LG Hamburg 26 September 1990; OLG Düsseldorf 8 January 1993],[89] assignment of claims [KG Berlin 24 January 1994],[90] assumption of debts [LG Hamburg 26 September 1990],[91] set-off of reciprocal obligations [AG Frankfurt 31 January 1991; OLG Koblenz 17 September 1993],[92] and issues of agency [LG Hamburg 26 September 1990; KG Berlin 24 January 1994].[93] [page 58]

4. Article 5

According to CISG Article 5, the CISG does not apply to the seller's liability for death or personal injury caused by the goods. This provision should have been discussed by the OLG Düsseldorf in a case where an American seller delivered a machine to a German buyer [OLG Düsseldorf 2 July 1993].[94] The buyer resold the machine to Russia where it was used in an industrial plant. Unfortunately, defects in the machine caused an accident that killed one workman and injured another. The German buyer, liable to his Russian customer, sued the American seller for compensation, in effect demanding discharge from his liability.[95] The OLG Düsseldorf held that the CISG applied to this claim.[96] This seems wrong, since such a claim for indemnification should also be precluded by CISG Article 5.[97]

5. Article 6

If a contract contains a choice of law clause referring to the law of a CISG Member State, it is not clear whether the CISG is applicable. On one hand, the parties may have intended application of the CISG as part of the chosen national law. On the other hand, they may have intended to apply only the designated national law, excluding the CISG. While the parties' intent should prevail, in most cases such intent cannot be proven. Courts, therefore, are bound to develop general rules for the interpretation of choice of law provisions. The German courts, in accord with most authors,[98] favor CISG application. In their view, the mere choice of a national law does not indicate an intent to exclude the CISG [OLG Koblenz 17 September 1993; OLG Düsseldorf 2 July 1993; OLG Köln 22 February 1994].[99] While this favors CISG application, it may not favor parties who did not intend CISG application.[100] However, contracting parties can avoid this ambiguity by expressly excluding the CISG. [page 59]

IV. CONTRACT FORMATION (ARTICLES 8, 11, & 14-24)

1. Article 8

The CISG does not address agency issues [LG Hamburg 26 September 1990; KG Berlin 24 January 1994],[101] and this gap has to be filled according to Article 7(2). Practically, this will lead to the application of national law. However, the LG Hamburg noted that, while agency is not determinable under the CISG, the subjective intent of the contracting parties is a matter of interpretation and therefore governed by Article 8 [LG Hamburg 26 September 1990].[102] The other requirements of agency, namely the authority to represent, are not governed by the CISG.

2. Article 11

The contract need not be concluded in or evidenced by writing. An oral sales contract is valid [OLG Köln 22 February 1994].[103]

3. Article 14

An invoice can be regarded as an offer. If the buyer confirms the invoice, a contract is formed [LG Aachen 14 May 1993].[104]

One of the most controversial issues arising under the CISG is the validity of an open price contract. CISG Article 14 requires that the price given in an offer be determinable. Several authors contend that a determinable price is a requirement for a valid contract.[105] Although this issue has not been heard by German courts, the Supreme Courts of Austria [OGH 10 November 1994] [106] and Hungary [Legfolsobb Birósag 25 September 1992] [107] have ruled on the issue, unfortunately reaching different solutions. In my opinion, Article 14 only provides interpretative guidance: there should be a presumption that the parties do not intend a contract to be formed before the price is fixed or determinable. If it can be proved that the parties intended to form the contract despite the open price, that intent should prevail.[108] [page 60]

4. Article 18

German law contains rather rigid principles regarding Kaufmännisches Bestätigungsschreiben (confirmation notices) which differ substantially from the laws of most other countries.[109] Under German law, a party may send to the other party a notice purportedly confirming the (alleged) content of the contract that actually deviates from the contract. If the other party does not contest this confirmation, the contract is irrefutably regarded as having the content of the confirmation note. The other party cannot argue that the contract is different from the confirmation notice or that the contract had not been formed. One gets the impression that confirmation notes are often used intentionally[110] to change the contract, and especially to enforce general conditions not agreed on before [LG Baden-Baden 14 August 1991].[111] Many foreign lawyers suspected that German courts would try to incorporate these principles into their application of the CISG.

However, German courts do not seem to decide in this manner. The OLG Köln, for example, recently stated that the confirmation notice principles do not apply under the CISG [OLG Köln 22 February 1994].[112] Failure to respond to a confirmation notice has no effect on the contract under the CISG. The notice can only be used as evidence. While the German principles on confirmation notices could be applicable as a usage under CISG Article 9, the decision of the OLG Köln shows that German courts are not prepared to accept such a usage merely because one contracting party comes from Germany.[113]

5. Article 19

An especially significant contract formation problem arises under the CISG when the acceptance deviates from the offer, or when different standardized forms are used for offer and acceptance ("the battle of the forms").[114] According to the LG Baden-Baden, if the seller's acceptance contains a clause limiting liability for non-conforming goods to defects noticed by the seller within thirty days after the invoice date, the additional terms do not materially change the contract and the acceptance is [page 61] valid under CISG Article 19(2) [LG Baden-Baden 14 August 1991].[115] I do not agree with the LG Baden-Baden because the additional terms drastically limit the seller's liability. Therefore, the terms must be regarded as a material deviation under CISG Article 19(3). At first glance, that would mean no contract had been concluded at all.[116]

However, apart from the fact that a contract may have been formed subsequently on the basis of partial performance, in my view the contract was concluded immediately despite Article 19 because the intent to enter a contract on the part of both parties trumps the Article 19 argument for invalidity.[117] The parties usually want to enter into a contract even if some terms are not in the contract. In the absence of evidence that clearly shows at least one party did not want a contract without particular terms, the formation of the contract should be indisputable. The lack of agreement is restricted only to the additional terms, and they have not become part of the contract.[118]

V. SALE OF GOODS (ARTICLE 25-88)

1. Article 25

Several decisions have dealt with the question of fundamental breach. It is interesting that this question has arisen only in the context of the buyer's right of avoidance.[119] Other CISG provisions that require a fundamental breach have not yet been considered by the German courts.[120]

In one case, an Italian seller promised to deliver shoes within a particular geographic area exclusively to the German buyer [LG Frankfurt 16 September 1991].[121] The seller delivered shoes to another merchant whose main place of business was outside the area reserved to the buyer but who had a place of business within the reserved area. The second buyer sold the shoes within the restricted area and in competition with the first buyer. Apparently, the seller did not intentionally violate his contractual obligation because the sale to the second buyer was organized by a commercial agent. The [page 62] agent either intentionally violated the contract or was unaware that the second buyer had a secondary place of business in the area reserved for the first buyer.

Because the first buyer did not receive exclusive deliveries as promised, he declared the contract void under CISG Article 49(1)(a). However, the LG Frankfurt am Main held that the breach was not fundamental (presumably, the court would deny that there was a breach of contract at all).[122] The court argued that the Italian seller could not have known where his German buyers had places of business, and that the knowledge of the commercial agent could not be imputed to the seller. These arguments are not convincing.[123] A seller who has promised exclusive delivery to the buyer is obliged to organize his distribution such that it meets his contractual obligations.

Of course, the seller is not liable for the acts of his other buyers. The seller must, however, impose contractual duties on other buyers to prevent them from selling the goods in the area reserved for the first buyer, and he must stop further deliveries if they do not comply. In any case, the seller is liable if he enters into contracts with other buyers who would foreseeably sell the product in the reserved area. The result is not different if the commercial agent alone can foresee the interference, since a seller who engages commercial agents is liable for their actions under CISG Article 79(2) to the extent they concern his obligations.

In a second case, an Italian manufacturer promised to manufacture shoes with a trademark ("Marlboro") [OLG Frankfurt 17 September 1991].[124] The manufacturer was allowed to use the trademark only with special permission from the buyer. Nevertheless, the manufacturer displayed the shoes with the trademark during a fair at Bologna and did not remove them upon demand of the buyer. The buyer declared the contract void under CISG Article 49(1)(a). The OLG Frankfurt am Main decided that the manufacturer had committed a fundamental breach because his actions severely shook the buyer's confidence in the manufacturer's contract fidelity.[125] The court held that violation of additional obligations could amount to a substantial breach. Therefore, the buyer could not be expected to cooperate further with the manufacturer. While this decision seems correct, it does not [page 63] answer the question of how to distinguish the fundamental character of a present breach from expected future breaches. As to an expected breach, the requirements of Article 72 go beyond those of Article 25 and should take precedence.

The buyer in a third case argued that the shoes delivered were not merchantable due to their lack of conformity [OLG Frankfurt 18 January 1994].[126] The OLG Frankfurt am Main held that this statement alone was not sufficient because it did not give the court enough details to decide whether the breach was fundamental.[127] Accordingly, the court regarded the buyer's declaration of avoidance under Article 49(1)(a) as ineffective, and the buyer had to pay for the shoes. This raises the question of how a buyer can convince the court that the goods are not saleable. In my opinion, it should be sufficient for the buyer to specify the non-conformity and the reasons why it is likely that the goods will not be saleable.[128] The buyer should not be forced to wait until his customers reject the goods, which seems to be the result of the strict requirments stated by the OLG Frankfurt am Main. From this perspective, these requirements seem too severe. Nevertheless, the result is correct, because the buyer did not state exactly why the shoes lacked conformity.

Finally, the OLG München decided as to a contract for the sale of coke that the alleged breaches -- minor lack of conformity and a direct sale to the contracting partner of the buyer -- were not fundamental [OLG München 2 March 1994] [129] (in fact, it was not proven that the seller had committed a breach of contract at all). I agree as far as the minor lack of conformity is concerned. If exact conformity is a special requirement of the buyer, then the contract should contain an appropriate clause. As far as the direct sale is concerned, I do not agree with the OLG München. The direct sale should be regarded as a fundamental breach even if it did not cause present prejudice to the buyer. In effect, the seller tried to interfere with the business relations of the buyer. This is a severe breach of confidence and it is reasonable to expect further interferences in the future. There is no reason to treat this breach of confidence differently from the impermissible use of the "Marlboro" trademark.[130] [page 64]

2. Article 26

For a declaration of contract avoidance to be effective, Article 26 requires that it is made by notice to the other party. One of the main issues under Article 26 is the required content of the notice. Generally, the notice has to make clear to the other party that the contract is avoided. However, the degree of clarity required in the notice is unsettled.[131] This question is very important because a notice of avoidance not meeting the requirements of Article 26 will not be effective, and the party may subsequently lose the right to avoid the contract under Articles 49(2) or 64(2).

According to the OLG Frankfurt am Main, the declaration of avoidance is effective if the avoiding party unmistakably tells the other party that the contractual relationship will be terminated [OLG Frankfurt 17 September 1991].[132] In one case, the AG Oldenburg in Holstein stated that the buyer's refusal to take delivery would suffice as an Article 49 declaration of avoidance [AG Oldenburg 24 April 1990].[133] This is especially true in the cases of late delivery where the refusal to accept delivery has a clear meaning.[134] On the other hand, the meaning would not be clear if the buyer rejects defective goods, because the rejection could be understood as a demand for substitute delivery under Article 46(2).

According to the LG Frankfurt am Main, a buyer who sends back one part of the goods and demands credit but declares that he will pay for the other part which he has already resold has not made an effective declaration of avoidance [LG Frankfurt 16 September 1991].[135] The court held that, although the seller had committed a fundamental breach which allowed the buyer to avoid the contract under Article 49, the buyer did not make explicit his desire to avoid the contract as required by Article 26.[136] This is not convincing. The return of the goods and the additional demand for a credit entry unmistakably show that the buyer did not want substitute delivery, but instead wanted to terminate the contract. The buyer's actions should have been understood as a partial avoidance under Article 51(1). The issue should have been whether a partial avoidance was possible in those circumstances. [page 65]

3. Article 29

Article 29 governs the termination or modification of the contract by mere agreement of the parties, such as a mutual respite in payment [LG Hamburg 26 September 1990] [137] or a settlement agreement [LG Aachen 14 May 1993].[138] Although Article 29 is in Part III of the CISG, the rules of Part II apply to the formation of agreements that modify or terminate a contract [LG Hamburg 26 September 1990; OLG Köln 22 February 1994].[139] Therefore, under Article 18(1), mere silence or inactivity does not amount to acceptance of an offer to terminate the contract. Nevertheless, the OLG Köln found an acceptance where the other party had not enforced the contract despite the receipt of non-conforming goods [OLG Köln 22 February 1994].[140]

Under these circumstances, the OLG Köln may have been correct. However, the general rule that silence is not an acceptance should be overruled only under exceptional circumstances that make clear the offeree's implicit acceptance. Otherwise we would reach the result that Article 18(1) is intended to prevent: an acceptance when the offeree regarded the offer only as an unacceptable nuisance and therefore did not see any reason to answer.

4. Article 31

The LG Aachen implicitly held that Article 31(a) applies only if the parties have agreed to it. In any other case, Article 31(b) or (c) applies [LG Aachen 14 May 1993].[141] This apparently comports with the language of Article 31, which supports the conclusion that Article 31(a) is an exception to Articles 31(b) and (c). The carriage of goods, however, is usually required in international trade. For this reason, there should be a presumption that the parties intended carriage of goods, and the application of Article 31(a) should be the basic rule.[142]

If the parties agree that delivery shall be made frei Haus,[143] Article 31(a) and Article 67 are not applicable. The clause frei Haus concerns not only the place and costs of delivery, but also the passing of risk. The risk of non-performance passes from the seller to the buyer only upon delivery [page 66] of the goods to the buyer's place of business.[144] If a seller could prove only that the goods were handed over to the carrier but not their arrival, he has not completed performance and is not entitled to payment [OLG Karlsruhe 20 November 1992].[145]

5. Article 33

The AG Oldenburg in Holstein dealt with a sales contract which provided for the delivery of textiles on "July, August and September +/-" [AG Oldenburg 24 April 1990] [146] The intended meaning of this delivery requirement was not clear; the seller argued that delivery was due only at the end of September, while the buyer argued that delivery of one-third of the total quantity was due in each of the three months. However, the court did not consider the delivery requirement, holding that the buyer could not avoid the contract under Article 33 even if his interpretation of the delivery date was correct.[147]

6. Article 35

In this case, the seller delivered shellfish heavily contaminated by cadmium [OLG Frankfurt 20 April 1994].[148] The buyer alleged that the degree of contamination exceeded the directives of the German Federal Health Department by more than 100%. However, according to the OLG Frankfurt am Main, the shellfish did not lack conformity because the parties had not agreed on a contamination threshold; therefore Article 35(1) was not applicable. Furthermore, in the opinion of the court, there was no lack of conformity under Article 35(2)(a) because the shellfish were fit to be eaten. Finally, the directives of the Federal Health Department are only recommendations and not obligatory. As the contamination did not violate German law, the court left open the question of the extent to which the public law of the buyer's nation affects the seller's obligations.[149]

I cannot agree. Essentially, the buyer did not intend to eat the shellfish but resell them. The real issue under Article 35(2)(a) is the quality a jobber can expect in the absence of detailed agreements. In my opinion, he can expect a quality that is reasonably merchantable. It also seems [page 67] clear that a jobber should neither be obliged to accept shellfish with a bad taste nor to take heavily contaminated shellfish. In both cases the shellfish are edible but probably unsaleable. The buyer's purpose was to resell the shellfish, and this purpose was frustrated. Therefore, it would have been correct to say that the shellfish lacked conformity. However, the Bundesgerichtshof has confirmed the decision by the OLG Frankfurt am Main [BGH 8 March 1995].[150]

Due to the ambiguous statements in the Secretariat Commentary to the CISG, the delivery of goods of another kind (Falschlieferung), as opposed to non-conforming goods, is controversial.[151] The issue is whether the delivery of goods of another kind is to be regarded as a non-conforming delivery[152] or as no delivery at all.[153] Without discussion, the OLG Düsseldorf has taken the view that the delivery of goods of another kind is a non-conforming delivery, simply stating that Article 39 was applicable [OLG Düsseldorf (6 U 119/93) 10 February 1994].[154] Especially German lawyers should appreciate this, since the distinction between non-conforming goods and goods of the wrong kind (with a further distinction relating to the degree of deviation) is one of the biggest nuisances in German sales law.

The German courts have not yet dealt with the CISG limitation period on buyer's remedies. German national law fixes a period of six months beginning with the date of delivery.[155] To the extent that the CISG is applicable, this rule is modified by Vertragsgesetz Article 3, which states that the six-month period begins with the buyer's notice of non-conformity, and not with delivery.[156] It is appropriate to consider only the modified rule in the context of CISG Article 39(2), which allows the buyer a maximum of two years to make the notification. Those provisions are part of German national law and are therefore applicable only when German law applies to the contract (generally, if German law has been chosen by the parties or if the seller is from Germany). Unfortunately, other countries with similar limitation provisions have not adopted the German solution, and harmonization of national limitation periods with CISG Article 39(2) can be reached only through interpretation.[157] [page 68]

7. Articles 38-44

Unsurprisingly, the buyer's notice to the seller of non-conforming goods is an important issue.[158] Most important are timeliness, specificity, and the consequences of delay. CISG Article 44 has not been discussed by German courts, probably because German law contains similar provisions concerning the notice of non-conformity, which makes it unlikely that German courts would accept the existence of a "reasonable excuse" for not meeting the notice requirements at all.[159]

Notice is required in all cases of non-conformity contemplated in Article 35, including the delivery of goods of another kind [OLG Düsseldorf (6 U 119/93) 10 February 1994] [160] and the delivery of a minor quantity [OLG Düsseldorf 8 January 1993].[161] Under CISG Article 39(1), notice is due within a reasonable time after the non-conformity of the goods is discovered or ought to have been discovered. The buyer must examine the goods according to Article 38. The notice period begins to run when the buyer could have discovered the defect during a proper examination, whether the buyer did not actually discover the lack of conformity because he did not examine the goods properly or because he did not examine them at all. Given the opportunity for a proper examination and where the lack of conformity could have been discovered, a notice made seven days [OLG Düsseldorf 8 January 1993],[162] sixteen days [LG Stuttgart 31 August 1989],[163] or more than two months [OLG Düsseldorf (6 U 32/93) 10 February 1994] [164] after delivery is considered delayed.[165] In contrast, the notice is timely if the buyer examines the goods on the day of delivery and dispatches the notice on the day after [LG Aachen 3 April 1990].[166]

The courts have tried to define the requirements of a proper examination. For example, a proper examination will allow: the buyer of shoes to discover that they are losing color and that the workmanship is bad [LG Stuttgart 31 August 1989],[167] the buyer of shirts to discover that the style is not correct [OLG Düsseldorf (6 U 32/93) 10 February 1994],[168] and the buyer of pickled cucumbers to discover that the quantity is not correct [OLG Düsseldorf 8 January 1993].[169] Generally, the examination must be made when the goods arrive at the place of delivery. However, if the seller knew that the goods were to be redirected, the examination can be deferred until the goods have arrived at their final destination under Article 38(3) [OLG Köln 22 February 1994].[170] Under Article 6, the parties can agree to substitute other examination requirements for these default rules [OLG Düsseldorf 8 January 1993].[171] [page 69]

Any other modification of Articles 38-44 is possible under Article 6; the parties can intensify or mitigate the burden of notice. The LG Baden-Baden considered an intensification, where the general contract conditions of an Italian tile seller provided that notice of a non-conformity must be provided within thirty days of the invoice date [Baden-Baden 14 August 1991].[172] The buyer, to justify his failure to provide notice within the thirty-day period, claimed that the non-conformity of the tiles was not discoverable upon examination. The LG Baden-Baden decided that the buyer had lost his right to rely on the lack of conformity.

This holding is correct if the clause was valid and had become part of the contract.[173] However, since the clause did not distinguish between discoverable and non-discoverable defects, its validity is questionable. In my opinion, the clause is extremely unfair because it prevents the buyer from exercising his rights as to a lack of conformity that is latent for more than thirty days.[174]

Under German law such a clause would be invalid, but German law was not applicable to the contract.[175] Italian law should have been applied to determine the clause's validity.[176] Since the LG Baden-Baden did not even discuss this problem, the outcome under Italian law is uncertain.[177]

Furthermore, the notice must specify the nature of the non-conformity under Article 39(1). The LG München I decided that the specificity requirement was not met when a buyer of shoes complained generally about bad fit and workmanship [LG München 3 July 1989].[178] I do not agree with the court. Generally, the requirement of specificity should not be exaggerated. Consider that it was the seller who delivered non-conforming goods; the buyer ought not have to bear the risk of non-conforming goods through unrealistic notice specificity requirements [BGH 2 June 1982 (a ULIS decision)].[179] A more general complaint, considered in context, should be sufficient.

Article 39 does not require that the notice of non-conforming goods be transmitted by a certain means of communication. While the notice can be made by telephone, the buyer has to prove that the telephone call was made and its content. Even worse, German courts will not even consider evidence of a telephone call if the buyer cannot exactly specify the date of the call and the other party to the conversation [LG Stuttgart 31 August 1989; LG Frankfurt 13 July 1994].[180] The reason for [page 70] this is that German procedural law does not allow a party to prove a point with Ausforschungsbeweis (purely exploratory offers of unspecified facts). However, I do not agree with this procedural law; the buyer who does not know the exact date of the telephone conversation should be able to furnish supporting evidence of both its occurrence and content. If the offered evidence is not convincing, the judge will disregard it.

If the buyer fails to provide notice, he loses the right to rely on the lack of conformity.[181] Foregone remedies for such reliance include, for example, substitute delivery,[182] repair,[183] or price reduction. The same rule applies where the buyer fails to provide notice of delivery of a lesser quantity of goods than required by the contract, at least in cases of a hidden shortage (verdeckte Minderlieferung);[184] the buyer loses his right to demand delivery of undelivered goods, and he has to pay the full price.[185] It is doubtful, however, that the same rule applies when the delivery documents accurately reflect the delivery of less than the contracted quantity (offene Minderlieferung) [OLG Düsseldorf 8 January 1993].[186] In this case, the seller probably knows or, at least, ought to know of the shortage, and therefore notice is not required.[187]

8. Article 49

In most cases of late delivery, the buyer can avoid the contract only after fixing an additional period for delivery.[188] Only under exceptional circumstances does late delivery constitute a fundamental breach and allow immediate avoidance.[189] An example of exceptional circumstances is the late delivery of fashionable articles. However, in a case involving fashionable articles, the AG Oldenburg in Holstein discussed only Article 49(1)(b) and dismissed the buyer's declaration of avoidance because he had not fixed an additional period for delivery [AG Oldenburg 24 April 1990].[190] Perhaps the court did not sufficiently consider Article 49(1)(a).[191] This result could be correct because, apart from the fact that there may have been no delay at all,[192] the parties indicated the delivery dates with the symbol "+/-." The intended meaning of this symbol could have been that there was no precise time for delivery. If so, the delayed delivery would not have constituted a fundamental breach. [page 71]

If the buyer receives non-conforming goods or goods of another kind, Article 49(1)(b) is not applicable. Therefore, the buyer can avoid only if the breach is fundamental.[193] However, Article 49(1)(b) is applicable if the buyer demands delivery of substitute goods under Article 46(2) because the substitute delivery is regarded as a delivery under Articles 31-33 and the provisions relating to delivery apply (again) [OLG Düsseldorf (6 U 119/93) 10 February 1994].[194] The buyer can fix a period for substitute delivery and avoid the contract if the seller does not deliver within the fixed period. If the buyer does not fix an additional period, avoidance is possible only if the breach is fundamental.[195] A fundamental breach occurs if the seller declares seriously and definitely (ernsthaft und endgültig) that he will not deliver substitute goods, but does not occur if he only declares that he cannot deliver at the moment [OLG Düsseldorf (6 U 119/93) 10 February 1994].[196]

According to Article 49(2)(b)(i), a declaration of avoidance based on breach other than late delivery must be made within a reasonable time after the buyer knew or ought to have known of the breach. A delay of two [OLG Frankfurt 20 April 1994] [197] or four months [OLG München 2 March 1994] [198] was held to be not reasonable. Of course, a declaration made after one day is timely [OLG Frankfurt 17 September 1991].[199]

9. Article 51

In this case, the buyer had ordered two tile sets ("A" and "B"), each consisting of both basic tiles and decorative tiles [LG Baden-Baden 14 August 1991].[200] The basic tiles of set "A" were non-conforming. The LG Baden-Baden accepted the buyer's declaration of avoidance as to the entire tile set "A" because the decorative tiles could not be used without the basic tiles. This decision is apparently inconsistent with CISG Article 51 which expressly provides for two alternatives: the contract may be avoided with respect to the non-conforming goods[201] or in its entirety.[202] Therefore, only two alternatives seem to be available: avoidance of the contract regarding the basic tiles of set "A" alone, or avoidance of the entire contract, including all tiles in both sets. However, I do agree with the court. CISG Article 73(3) expressly provides this solution for installment contracts, and there is no reason to treat other contracts differently. [page 72]

10. Article 60

The AG Oldenburg in Holstein applied German national law in a case where the buyer did not take possession of the goods at the seller's place of business (Annahmeverzug)[203] as required by CISG Article 31(c) [AG Oldenburg 24 April 1990].[204] I do not agree with the court's application of German national law; the court obviously did not consider that the buyer's obligation to take possession of the goods is dealt with in CISG Article 60. The application of national law in addition to the governing CISG articles seems not to be possible.[205]

The problem is, in fact, even more complicated. German national law distinguishes between a buyer's duty to take possession of the goods [206] -- the direct equivalent to and surely displaced by CISG Article 60 -- and the general concept of Annahmeverzug. In German national law, Annahmeverzug is applicable alongside the buyer's duty to take possession of the goods. Therefore, one could argue that the concept of Annahmeverzug is arguably not displaced by the CISG. But that would not be convincing, since the CISG does not make such a distinction. Most importantly, Annahmeverzug is about risk transfer, which is governed by CISG Articles 66-70.[207]

11. Article 62

The seller's payment claim must be made in the currency provided for in the contract. Therefore, if a sales contract calls for payment in Italian Lira, the seller cannot demand German Marks [KG Berlin 24 January 1994].[208] However, if German law were applicable, the buyer could still choose payment in German Marks [OLG Koblenz 17 September 1993].[209]

12. Article 71

In the German literature there is no consensus as to whether the notice of suspension under Article 71(3) is required to justify suspension [210] or is merely an additional duty whose violation does not affect the right of [page 73] suspension but only entitles the other party to claim damages.[211] The AG Frankfurt am Main held that notice is required to suspend the contract under Article 71 [AG Frankfurt 31 January 1991].[212]

13. Article 74

Article 74 allows only monetary damages for breach of contract; compensation in kind is not permitted.[213] Nevertheless, the OLG Düsseldorf held that a buyer of defective goods who became liable to a second buyer could demand discharge from his liability as a seller of defective goods to the second buyer from the original seller [OLG Düsseldorf 2 July 1993].[214] Although this holding is arguably incorrect,[215] I agree. As soon as the first buyer paid damages to the second buyer, he could recover the sum paid from the original seller. There is no reason why the original seller should not pay directly the second buyer.[216]

The recovery of interest under CISG Article 78 is only a minimum, allowed "without prejudice to any claim for damages." For example, the seller can recover damages if his sales are prefinanced and he has to pay interest for any delay in payment [LG Aachen 3 April 1990],[217] or if he has to pay interest for other credit obtained as a necessary consequence of a delayed payment [OLG Koblenz 17 September 1993].[218] However, the courts do not agree on the showing required for such consequential damages. Two decisions have held that the seller has to specify and prove his loss exactly, and that it is not sufficient for the seller to declare generally that he is working on credit as a consequence of delayed payment [LG Frankfurt 16 September 1991; OLG Frankfurt 18 January 1994].[219] In another decision, however, the court tried to moderate these burdens [LG Hamburg 26 September 1990].[220] Although the seller did not prove that he had to obtain credit because of payment delay, the court granted damages based on the discount rate in the seller's country.

According to the second sentence of Article 74, damages suffered as a consequence of a breach of contract are recoverable only if such damages were foreseeable to the party in breach at the time the contract was concluded. No German court has yet barred a claim for damages because of this provision. A court has held that the buyer's liability to third parties [page 74] was foreseeable when the goods were not timely delivered [LG Aachen 14 May 1993],[221] and in another case that the buyer could foresee that non-payment would force the seller to obtain credit [OLG Koblenz 17 September 1993].[222]

14. Article 78

Article 78 allows for the collection of interest on any monetary arrearage, without prejudice to damages recoverable under Article 74. Unfortunately, Article 78 does not provide for the calculation of an appropriate interest rate. Accordingly, the allowed interest rate must be calculated under national law.[223] The issue is which national law is applicable to determine the interest rate. Most authors [224] and courts [LG Hamburg 26 September 1990; OLG Frankfurt 13 June 1991; OLG Frankfurt 18 January 1994; OLG München 2 March 1994; OLG Koblenz 17 September 1993; OLG Düsseldorf (6 U 119/93) 10 February 1994] [225] have generally agreed that the law applicable to the issue of interest is the Vertragsstatut (the law that governs the contract apart from CISG); in the absence of a choice of law provision in the contract, the applicable law would be the seller's law [OLG Koblenz 17 September 1993; OLG Düsseldorf (6 U 119/93) 10 February 1994].[226] At least one court decided that the creditor's law was applicable [LG Frankfurt 16 September 1991; see also LG Stuttgart 31 August 1989 and KG Berlin 24 January 1994 (Neither decision making clear whether interest was granted according to Article 78 or damages according to Article 74)] [227] and another court did not decide on the question because the results did not differ.[228] In addition, some authors have proposed other solutions, such as application of the law of the debtor's country[229] or of the country which issued the currency specified in the contract.[230] These solutions have not been adopted by the courts. The problem is of considerable importance since interest rates are rather low in some states (four or five percent in Austria and Germany) but much higher in others (ten percent in Italy and more than fifty percent in Bulgaria).[231] The contracting parties should avoid these uncertainties by agreeing on an interest rate or by choosing the applicable law.

VI. JURISDICTION AND VENUE FOR AN ACTION

The CISG does not deal with procedural issues and therefore contains no rules concerning jurisdiction and venue for an action. For German courts, jurisdiction and venue issues are governed and determined by the [page 75] relevant provisions of the Zivilprozeßordnung (ZPO) and the European Community's Convention on Jurisdiction and Enforcement of Judgments in Civil and Commercial Matters (EC Convention) [OLG Koblenz 17 September 1993].[232]

However, jurisdiction and venue can depend on the applicable non-procedural law, and then the CISG is relevant indirectly. For example, under ZPO Section 29 and Article 5(1) of the EC Convention, a claim can be filed at the Erfüllungsort (place where performance did or should have occurred). In this respect, it is important that under the CISG contract payments are frequently due at the seller's place of business.[233] Therefore, the seller can file a claim for payment in the jurisdiction where his place of business is located.

The Court of the European Community has recently confirmed jurisdiction in the locale of the seller's place of business under the EC Convention [Custom Made Commercial Ltd. v. Stawa Metallbau GmbH 29 June 1994].[234] Although this decision concerned ULIS, the same rationale applies to the CISG. This result, however, is not very convincing, since it seems unfair that the buyer can be sued in the seller's country. While this unfair result is a consequence of the CISG drafters' unwillingness to interfere with national procedural statutes,[235] the CISG is not the source of the problem. Procedural provisions like ZPO Section 29 and Article 5(1) of the EC Convention are the problematic sources.

Unfortunately, the courts have even tried to extend the application of CISG Article 57. According to the OLG Düsseldorf, Article 57 applies not only to contractual payments, but to all other demands for the payment of money, such as damages claims [OLG Düsseldorf 2 July 1993].[236] This allows the creditor to file the claim for payment in the jurisdiction encompassing his place of business. It is doubtful that this application of Article 57 is correct since one could argue that there is no separate place of performance for damages. In general, the place where the duty should have been performed ought to govern.[237] For example, if the seller has not delivered the goods, the place of performance (and the venue) should be the same for a claim demanding specific performance and for a damages claim. [page 76]

CONCLUSION

The German courts have had no particular problems in applying the CISG. Most decisions demonstrate that the courts have complete command of both the ClSG's general principles and the detailed problems. Serious errors do not occur very often. This is not surprising, since German courts have gained much experience by applying ULIS and ULF for over two decades. Although the structures of CISG and ULIS/ULF are different, the basic principles are similar. Therefore, most decisions relating to ULIS and ULF will influence CISG application.[238]

The large number of CISG-related decisions shows that the Convention is successful. The prediction that most parties would exclude the CISG under Article 6 has not come true. Of course, some parties do exclude CISG application. But many others use the CISG, at least in cases where the application of German national law is not acceptable to foreign parties.

Finally, the decisions reveal that the CISG enables results consistent with the needs of international trade. This can only add to the CISG's future success in the coming decades. Merchants and lawyers will continue to learn that the CISG is a very useful alternative to national sales laws. The CISG seems to be well on the way to becoming the Magna Carta of international trade. Ernst Rabel and all the others who worked so hard to unify international sales laws during the last sixty years would surely appreciate that. [page 77]


FOOTNOTES

* Professor of Law at the University of Bonn, Germany, from 1992 to February 1995. Currently, Professor of Law at the University of Linz, Austria. Address: Institut für Handels-und Wertpapierrecht, Universität Linz, A-4040 Linz-Auhof, Austria, Europe.

1. For historical background, see Michael Bonell, Introduction, in Commentary on the International Sales Law 3, 3-7 (C.M. Bianca & M.J. Bonell eds., 1987); John Honnold, Uniform Law for International Sales under the 1980 United Nations Convention §§ 4-10 (2d ed. 1991).

2. See 1 Ernst Rabel, Das Recht des Warenkaufs (1936); 2 Ernst Rabel, Das Recht des Warenkaufs (1958).

3. Conventions on International Sale of Goods and Formation of Contracts for the International Sale of Goods, Convention Relating to a Uniform Law of International Sale of Goods, opened for signature July 1, 1964, 3 I.L.M. 854, 855 [hereinafter ULIS]; Conventions on International Sale of Goods and Formation of Contracts for the International Sale of Goods, Convention Relating to a Uniform Law of Formation of Contracts for the International Sale of Goods, opened for signature July 1, 1964, 3 I.L.M. 854, 864 [hereinafter ULF].

4. United Nations Convention on Contracts for the International Sale of Goods, United Nations Conference on Contracts for the International Sale of Goods, at 178, U.N. Doc. A/CONF.97/18, Annex I (1981) (opened for signature Apr. 11, 1980) [hereinafter CISG or Convention].

5. Rolf Herber & Beate Czerwenka, Internationales Kaufrecht 11 n.3 (1991).

6. See Vertragsgesetz [VertragsG] art. 2. This statute was enacted in order to adopt the CISG into German Law. It also contains additional rules concerning the application of Article 1(1)(b), id., and the 1imitation period for remedies following non-conforming goods. Id. art. 3.

7. But see infra part III.1.

8. Hungary has been a CISG Member State since January 1, 1988.

9. These states are: Brandenburg, Mecklenburg-Vorpommern, Sachsen, Sachsen-Anhalt, and Thüringen. East Berlin was incorporated into the federal state of Berlin and ceased to exist independently.

10. See Fritz Enderlein & Bernhard Graefrath, Nochmals: Deutsche Einheit und internationales Kaufrecht, Deutsche Einigung-Rechtsentwicklungen, No.l9, at 8 (1991) (arguing that the CISG was applicable in former GDR states because they retained a semi-autonomous existence after the GDR ceased to exist as an independent nation).

11 See Rolf Herber, Deutsche Einheit und internationales Kaufrecht, Deutsche Einigung-Rechtsentwicklungen, No. 15, at l (1991); Rolf Herber, Deutsche Einheit und internationales Kaufrecht: eine Replik, Deutsche Einigung-Rechtsentwicklungen, No. 23, at 7 (1991); Gert Reinhart, Probleme des intertemporalen Rechts im innerdeutschen und internationalen Handelsverkehr, in Der Weg zur deutschen Rechtseinheit 83 (Erik Jayme & Oliver Furtak eds., 1991); Ulrich Magnus, Aktuelle Fragen des UN-Kaufrechts, 1993 Zeitschrift für Europäisches Privatrecht [ZEuP] 79, 92-94.

The same controversy has arisen over the applicability of the Convention on the Limitation Period in the International Sale of Goods. The FRG did not join this Convention, but the GDR was a member. However, the German government has taken the position that this Convention has not been applicable in the FRG since October 3, 1990. Statement of the Federal Minister of Justice (June 10, 1992), reprinted in 1992 Deutsch-Deutsche Rechts-Zeitschrift 241.

12. For bibliographies, see, e.g., Michael R. Will, International Bibliography 1980-1995 (1995); Kommentar zum Einheitlichen UN-Kaufrecht XXXI (Ernst von Caemmerer & Peter Schlechtriem eds., 2d ed. 1995).

13. Kommentar zum Einheitlichen UN-Kaufrecht (Ernst von Caemmerer & Peter Schlechtriem eds., 1st ed. 1990 & 2d ed. 1995).

14. Fritz Enderlein et al., Kaufrechtskonvention der UNO (mit Verjährungskonvention) (1985).

15. Fritz Enderlein et al., Internationales Kaufrecht (1991).

16. Herber & Czerwenka, supra note 5.

17. Roland Loewe, Internationales Kaufrecht (1989).

18. Ulrich Magnus, UN-Kaufrecht (1995) (separate volume of Staudingers Kommentar zum Bürgerlichen Gesetzbuch (13th ed. 1994).

19. Gert Reinhart, UN-Kaufrecht (1991).

20. Martin Karollus, UN-Kaufrecht (1991).

21. Burghard Piltz, Internationales Kaufrecht (1993).

22. Peter Schlechtriem, Einheitliches UN-Kaufrecht (1981) (published in English as Uniform Sales Law (1986)).

23. Georg Wilhelm, UN-Kaufrecht (1993).

24. Wiener Kaufrecht (Eugen Bucher ed., 1991).

25. Das UNCITRAL-Kaufrecht im Vergleich zum österreichischen Recht (Peter Doralt ed., 1985).

26. Das Einheitliche Wiener Kaufrecht (Hans Hoyer & Willibald Posch eds., 1992).

27. Einheitliches Kaufrecht und Nationales Obligationenrecht (Peter Schlechtriem ed., 1987).

28. For decisions through June 1995, see Will, supra note 12.

29. Judgment of July 3, 1989, LG München I, 1990 Praxis des Internationalen Privat-und Verfahrensrechts [IPRax] 316 cmt. G. Reinhart, at 289, 291-92.

30. Judgment of Aug. 31, 1989, LG Stuttgart, 1989 Recht der Internationalen Wirtschaft [RIW] 984, 1990 IPRax 317 cmt. G. Reinhart, at 289, 291-92.

31. Judgment of Apr. 3, 1990, LG Aachen, 1990 RIW 491 cmt. G. Reinhart, at 1990 IPRax 289, 291-92.

32. Judgment of Apr. 24, 1990, AG Oldenburg in Holstein, 1991 IPRax 336 cmt. F. Enderlein, at 313.

33. Judgment of Sept. 26, 1990, LG Hamburg, 1990 RIW 1015, 1991 IPRax 400 cmt. G. Reinhart, at 376.

34. Judgment of Jan. 31, 1991, AG Frankfurt am Main, 1991 IPRax 345 cmt. E. Jayme.

35. Judgment of June 13, 1991, OLG Frankfurt am Main, 1991 RIW 591, 1991 Entscheidungen zum Wirtschaftsrecht [EWiR] 1199 cmt. R. Herber.

36. Judgment of Aug. 14, 1991, LG Baden-Baden, 1992 RIW 62.

37. Judgment of Sept. 16, 1991, LG Frankfurt am Main, 1991 RIW 952.

38. Judgment of Sept. 17, 1991, OLG Frankfurt am Main, 1991 RIW 950, 1991 EWiR 1081 cmt. P. Schlechtriem, 1992 Neue Juristische Wochenschrift [NJW] 633.

39. Judgment of Nov. 20, 1992, OLG Karlsruhe, 1993 Neue Juristische Wochenschrift -- Rechtsprechungs Report [NJW-RR] 1316.

40. Judgment of Jan. 8, 1993, OLG Düsseldorf, 1993 RIW 325, 1993 IPRax 412 cmt. U. Magnus, at 390.

41. Judgment of May 14, 1993, LG Aachen, 1993 RIW 760.

42. Judgment of July 2, 1993, OLG Düsseldorf, 1993 RIW 845, 1993 EWiR 1075 cmt. P. Schlechtriem.

43. Judgment of Sept. 17, 1993, OLG Koblenz, 1993 RIM 934.

44. Judgment of Jan. 18, 1994, OLG Frankfurt am Main, 1994 RIW 240 cmt. F. Diedrich, at 1995 RIW 11, 1994 NJW 1013 cmt. A. Kappus, at 984.

45. Judgment of Jan. 24, 1994, KG Berlin, 1994 RIM 683.

46. Judgment of Feb. 10, 1994, OLG Düsseldorf, 1995 RIW 53.

47. Judgment of Feb. 10, 1994, OLG Düsseldorf, 1994 RIM 1050.

48. Judgment of Feb. 22, 1994, OLG Köln, 1994 RIW 972, 1994 EWiR 867 cmt. P. Schlechtriem.

49. Judgment of Mar. 2, 1994, OLG München, 1994 RIW 595.

50. Judgment of Apr. 20, 1994, OLG Frankfurt am Main, 1994 RIW 593.

51. Judgment of July 13, 1994, LG Frankfurt am Main, 1994 NJW-RR 1264.

52. For seven of these unpublished decisions, see Burghard Piltz, Neue Entwicklungen im UN-Kaufrecht, 1994 NJW 1101 (1994).

53. Tribunals of other nations have considered the CISG. See, e.g., Sentence rendue en 1992 dans l'affaire 7197 [ICC arbitral award No. 7197], 1993 Journal du Droit International [J.D. INT'L] 1029 (1993) (Aus.); Sentence finale rendue dans l'affaire 6653 en 1993 [ICC arbitral award No. 6653], 1993 J.D. INT'L 1040 (1993) (Fr.); Schiedssprüche SCH-4366 und SCH-4318 vom 15.6.1994 [Arbitral Court of the Federal Chamber of Commerce Award Nos. 4366 and 4318], 1995 RIW 590 cmt. P. Schlechtriem (1994) (Aus.).

54. These are the latest statistics available. The number of courts has since increased because of the unification of the two German states. However, the courts in the GDR were organized in a different way, and adaptation to the system of the Federal Republic seems not yet finished.

55. The Bundesverfassungsgericht (Federal Constitutional Court) is the highest court convened as to constitutional matters. A losing party before the BGH could appeal to the Bundesverfassungsgericht under a claim of a constitutional rights violation.

56. See Zivilprozeßordnung [ZPO] §§ 545-554(b).

57. Judgment of Feb. 15, 1995, BGH, 1995 NJW 2101; Judgment of Mar. 3, 1995, BGH, 1995 NJW 2099.

58. For more detailed analyses of the German decisions, see Martin Karollus, UN-Kaufrecht: Erste Gerichtsentscheidungen, 1991 Österreichisches Recht der Wirtschaft [RdW] 319 (1991); Martin Karollus, Rechtsprechung zum UN-Kaufrecht (II), 1992 RdW 168 (1992); Martin Karollus, Rechtsprechung zum UN-Kaufrecht (III), 1994 RdW 386 (1994); Magnus, supra note 11; Piltz, supra note 52.

59. CISG, supra note 4, art. 7(1).

60. Id. art. 100(1).

61. Id. art. 100(2).

62. For decisions applying the CISG under Article 1(1)(a), see Judgment of May 14, 1993, LG Aachen, 1993 RIW 760; Judgment of Jan. 18, 1994, OLG Frankfurt am Main, 1994 RIW 240; Judgment of Apr. 20, 1994, OLG Frankfurt am Main, 1994 RIW 593; Judgment of July 13, 1994, LG Frankfurt am Main, 1994 NJW-RR 1264; Judgment of Mar. 2, 1994, OLG München, 1994 RIW 595. See also Judgment of Feb. 10, 1994, OLG Düsseldorf, 1994 RIW 1050 (the CISG may be applicable under either Article 1(1)(a) or (b)).

63. For decisions applying the CISG under Article 1(1)(b) (seller's country in parentheses), see Judgment of July 3, 1989, LG Münich I, 1990 IPRax 316 (Italy); Judgment of Aug. 31, 1989, LG Stuttgart, 1990 IPRax 317(Italy); Judgment of Apr. 3, 1990, LG Aachen, 1990 RIW 491 (Italy); Judgment of Apr. 24, 1990, AG Oldenburg in Holstein, 1991 IPRax 336 (Italy); Judgment of Sept. 26, 1990, LG Hamburg, 1991 IPRax 400 (Italy); Judgment of Jan. 31, 1991, AG Frankfurt am Main, 1991 IPRax 345 (Italy); Judgment of June 13, 1991, OLG Frankfurt am Main, 1991 RIW 591 (France); Judgment of Aug. 14, 1991, LG Baden-Baden, 1992 RIW 62 (Italy) (implicit application of CISG Article 1(1)(b)); Judgment of Sept. 16, 1991, LG Frankfurt am Main, 1991 RIW 952 (Italy); Judgment of Sept. 17, 1991, OLG Frankfurt am Main, 1991 RIW 950 (Italy); Judgment of Nov. 20, 1992, OLG Karlsruhe, 1993 NJW-RR 1316 (France); Judgment of July 2, 1993, OLG Düsseldorf, 1993 RIW 845 (Indiana, USA); Judgment of Sept. 17, 1993, OLG Koblenz, 1993 RIW 934 (France); Judgment of Jan. 24, 1994, KG Berlin, 1994 RIW 683 (Italy) (same result as application of CISG Article 1(1)(b) using conflict of laws analysis); Judgment of Feb. 10, 1994, OLG Düsseldorf, 1995 RIW 53 (France).

64. See Einführungsgesetz zum Bürgerlichen Gesetzbuch [EGBGB] arts. 27-28.

65. EGBGB art. 28.

66. Judgment of July 2, 1993, OLG Düsseldorf, 1993 RIW 845.

67. 52 Fed. Reg. 6262 (1987).

68. See Malcolm Evans, Article 95, in Commentary on the International Sales Law 654, 656-57 (C.M. Bianca & M.J. Bonell eds., 1987); Honnold, supra note 1, §§ 47-47.5; Karollus, supra note 20, at 31.

69. See supra note 6 and accompanying text.

70. See Peter Schlechtriem, Kurzkommentar, 1993 EWiR 1075.

71. See EGBGB art. 35.

72. Under the doctrine of renvoi, a court in resorting to foreign law adopts rules of foreign law as to conflict of laws, which rules may in turn refer the court back to the laws of the forum.

73. See Karollus, supra note 20, at 33. But see Magnus, supra note 18, at 47.

74. Judgment of Feb. 20, 1992, Bezirksgericht für Handelssachen Wien, 1992 RdW 239. For critical commentary on this case, see Magnus, supra note 11, at 83; Karollus, Rechtsprechung zum UN-Kaufrecht (III), supra note 58.

75. For the position that the CISG is applicable only to physically tangible goods, see Hans Hoyer, Der Anwendungsbereich des UNCITRAL-Einheitskaufrechts, 1988 Wirtschaftsrechtliche Blätter [WBI] 70, 71.

76. Judgment of Sept. 17, 1993, OLG Koblenz, 1993 RIW at 936. See KAROLLUS, supra note 20, at 21; Maximillian Endler & Jan Daub, Internationale Softwareüberlassung und UN-Kaufrecht, 1993 Computer und Recht 601; Frank Diedrich, Anwendbarkeit des Wiener Kaufrechts auf Softwareüberlassungsverträge, 1993 RIW 441.

77. Judgment of Sept. 17, 1991, OLG Frankfurt am Main, 1991 RIW 950.

78. Judgment of July 2, 1993, OLG Düsseldorf, 1993 RIW 845.

79. Judgment of Sept. 17, 1993, OLG Koblenz, 1993 RIW 934.

80. Bürgerliches Gesetzbuch [BGB] § 651.

81. BGB §§ 633-50.

82. CISG Article 3(1) states: "Contracts for the supply of goods to be manufactured or produced are to be considered sales unless the party who orders the goods undertakes to supply a substantial part of the materials. . . ." CISG, supra note 4, art. 3(1). No court has yet considered the meaning of "substantial part." For discussion of the interpretation of "substantial part," see Honnold, supra note 1, § 59; Herber & Czerwenka, supra note 16, at 28; Karollus, supra note 20, at 22-23; Rolf Herber, Art. 3: Verträge über herzustellende Waren oder Dienstleistungen, in Kommentar zum Einheitlichen UN-Kaufrecht 68 (Ernst van Caemmerer & Peter Schlechtriem eds., 2d ed. 1995).

83. CISG, supra note 4, art. 4(a). There are exceptions. For example, Article 29 excludes the doctrine of "consideration." See Honnold, supra note 1, §§ 201, 204.1-204.4. Furthermore, the CISG should prevail over national statutes that declare invalid contracts that cannot be performed at formation (anfängliche Unmöglichkeit). For examples of such laws, see BGB § 306; Allgemeines Bürgerliches Gesetzbuch [ABGB] § 878 (Aus.);Schweizerisches Obligationenrecht [OR] art. 20(1) (Switz.). For discussion of the relation between national sales laws and the CISG as to impossibility, see Karollus, supra note 20, at 43; Hans Stoll, Art. 79: Hinderungsgrund außerhalb des Einflußbereichs des Schuldners, in Kommentar zum Einheitlichen UN-Kaufrecht 679, 686 (Ernst von Caemmerer & Peter Schlechtriem eds., 2d ed. 1995). But see Denis Tallon, Article 79, in Commentary on the International Sales Law 572 (C.M. Bianca & M.J. Bonell eds., 1987); Wanki Lee, Exemptions of Contract Liability Under the 1980 United Nations Convention, 8 Dick. J. Int'l L. 375, 386-87 (1990).

84. See, e.g., BGB § 119.

85. This is unlike ULIS, which expressly excludes consideration of non-conforming goods. ULIS, supra note 3, art. 34.

86. See Ulrich Huber, Art. 45: Rechtsbehelfe des Käufers; keine zusätzliche Frist, in Kommentar zum Einheitlichen UN-Kaufrecht 401 (Ernst von Caemmerer & Peter Schlechtriem eds., 2d ed. 1995); Karin Flesch, Mängelhaftung und Beschaffenheitsirrtum beim Kauf 127-58 (1994). Some Austrian authors disagree. See Rudolf Lessiak, UNCITRAL-Kaufrechtsabkommen und Irrtumsanfechtung, 1989 Juristische Blätter [JBl] 487; Karollus, supra note 20, at 41-42.

87. The LG Aachen agreed with this argument. Judgment of May 14, 1993, 1993 RIW at 761.

88. Id.

89. Judgment of Sept. 26, 1990, LG Hamburg, 1991 IPRax 400; Judgment of Jan. 8, 1993, OLG Düsseldorf, 1993 RIW 325.

90. Judgment of Jan. 24, 1994, KG Berlin, 1994 RIW 683.

91. Judgment of Sept. 26, 1990, LG Hamburg, 1991 IPRax at 402.

92. Judgment of Jan. 31, 1991, AG Frankfurt am Main, 1991 IPRax 345; Judgment of Sept. 17, 1993, OLG Koblenz, 1993 RIW at 937.

93. Judgment of Sept. 26, 1990, LG Hamburg, 1991 IPRax at 401; Judgment of Jan. 24, 1994, KG Berlin, 1994 RIW 683. But see infra part IV.1.

94. Judgment of July 2, 1993, 1993 RIW 845.

95. See infra part VI.13.

96. In addition, the OLG Düsseldorf should not have applied the CISG because the United States opted out of Article 1(1)(b). See supra note 67 and accompanying text.

97. See W. Khoo, Article 5, in Commentary on the International Sales Law 49 (C.M. Bianca & M.J. Bonell eds., 1987); Schlechtriem, supra note 22, at 20; Rolf Herber, Art. 5: Ausschluß der Haftung für Tod oder Körperverletzung, in Kommentar zum Einheitlichen UN-Kaufrecht 79 (Ernst von Caemmerer & Peter Schlechtriem eds., 2d ed. 1995); Reinhart, supra note 19, at 25.

98. See Rolf Herber, Art. 6: Ausschluß, Abweichung oder Änderung durch Parteiabrede, in Kommentar zum Einheitlichen UN-Kaufrecht 13 (Ernst von Caemmerer & Peter Schlechtriem eds., 2d ed. 1995).

99. Judgment of Sept. 17, 1993, OLG Koblenz, 1993 RIW at 934-36 (the parties chose "French law," and the court applied the CISG as part of French law); Judgment of July 2, 1993, OLG Düsseldorf, 1993 RIW at 845 (the parties did not indicate a choice of law, but the court noted that if they had chosen German law, the CISG would not apply because it was not in force in Germany when the contract was formed); Judgment of Feb. 22, 1994, OLG Köln, 1994 RIW at 972. The leading decision of the Bundesgerichtshof as to ULIS and choice of law provisions is Judgment of Dec. 4, 1985, BGH, 96 Entscheidungen des Bundesgerichtshofs in Zivilsachen [BGHZ] 313 (1986).

100. See Karollus, supra note 20, at 38-39.

101. See Judgment of Sept. 26, 1990, LG Hamburg, 1991 IPRax at 401; Judgment of Jan. 24, 1994, KG Berlin, 1994 RIW at 683; Honnold, supra note 1, § 66 ("The Convention does not address the complex issues that underlie questions of agency and authority.").

102. Judgment of Sept. 26, 1990, LG Hamburg, 1991 IPRax at 401.

103. Judgment of Feb. 22, 1994, OLG Köln, 1994 RIW at 972.

104. Judgment of May 14, 1993, LG Aachen, 1993 RIW at 761.

105. See, e.g., Franz Bydlinski, Das allgemeine Vertragsrecht, in Das UNCITRAL-Kaufrecht im Vergleich zum österreichischen Recht 57, 62-63 (Peter Doralt ed., 1985).

106. Judgment of Nov. 10, 1994, Österreichischer Oberster Gerichtshof [OGH], 1995 JBl 253 cmt. M. Karollus (holding that the price agreement, "DM 35-65," is determinable under CISG Article 14).

107. Judgment of Sept. 25, 1992, Legfolsobb Biróság [Supreme Court of Hungary], reprinted in 13 J.L. & Com. 32 (Dr. László Szlávnits trans., 1993) (holding that the intent to enter a contract is not sufficient to make a contract when the price is not determinable). But see Paul Amato, Note, U.N. Convention on Contracts for the International Sale of Goods -- The Open Price Term and Uniform Application: An Early Interpretation by the Hungarian Courts, 13 J.L. & Com. 1 (1993) (criticizing the Hungarian Supreme Court's decision of Sept. 25, 1992).

108. See Karollus, supra note 20, at 60-62; Eugen Bucher, Preisvereinbarung als Voraussetzung der Vertragsgültigkeit beim Kauf, in Wiener Kaufrecht 53 (Eugen Bucher ed., 1991).

109. For a detailed analysis of German, French, Austrian, and Swiss Law, as well as the CISG, see Michael J. Esser, Die letzte Glocke zum Geleit?, 29 Zeitschrift für Rechtsvergleichung (ZfRV) 167 (1988).

110. In fact, German courts do not recognize confirmation notices when used intentionally. Of course, it may be difficult to prove such an intention.

111. See Judgment of Aug. 14, 1991, LG Baden-Baden, 1992 RIW at 63.

112. Judgment of Feb. 22, 1994, OLG Köln, 1994 RIW at 973. See Peter Schlechtriem, Kurzkommentar, 1994 EWiR 867, 868 (discussing the judgment and agreeing with its conclusion).

113. See Schlechtriem, supra note 112, at 868.

114. See, e.g., François Vergne, The "Battle of the Forms" Under the 1980 United Nations Convention on Contracts for the International Sale of Goods, 33 Am. J. Comp. L. 233 (1985); Karl Neumayer, Das Wiener Kaufrechtsübereinkommen und die sogenannte "battle of forms," in Freiheit und Zwang: Festschrift für Hans Giger 501 (Walter J. Habscheid et al. eds., 1989); Peter Schlechtriem, Art. 19: Ergänzungen, Einschränkungen und sonstige Änderungen zum Angebot, in Kommentar zum Einheitlichen UN-Kaufrecht 171, 178-80 (Ernst von Caemmerer & Peter Schlechtriem eds., 2d ed. 1995); Karollus, supra note 20, at 70-71.

115. Judgment of Aug. 14, 1991, LG Baden-Baden, 1992 RIW at 63. The decision does not make clear whether the additional terms were contained in an acceptance or a confirmation notice regarding an existing contract. In the latter case, Article 19 should not apply at all. Karollus, supra note 20, at 72.

116. See CISG, supra note 4, art. 19(1); Karollus, supra note 20, at 169.

117. See Karollus, supra note 20, at 70-71.

118. In German national law, this solution is called Restgültigkeitslösung.

119. See CISG, supra note 4, art. 49(1)(a).

120. See, e.g., id. arts. 46(2), 64(1)(a), 70.

121. Judgment of Sept. 16, 1991, LG Frankfurt am Main, 1991 RIW 952.

122. Id

123. See Karollus, supra note 20, at 169.

124. Judgment of Sept. 17, 1991, OLG Frankfurt am Main, 1991 RIW 950.

125. Id. at 950-51.

126. Judgment of Jan. 18, 1994, OLG Frankfurt am Main, 1994 RIW 240. See CISG, supra note 4, art. 35.

127. Id. at 241.

128. See Ulrich Huber, Art. 46: Recht des Käufers auf Erfüllung oder Nacherfüllung, in Kommentar zum Einheitlichen UN-Kaufrecht 428, 441 (Ernst von Caemmerer & Peter Schlechtriem eds., 2d ed. 1995).

129. Judgment of Mar. 2, 1994, OLG München, 1994 RIW 595.

130. See supra notes 124-25 and accompanying text.

131. For discussion of the contents of contract avoidance notices, see, e.g., Enderlein et al., supra note 15, at 105; Hans G. Leser, Art. 26: Aufhebungserklärung, in Kommentar zum Einheitlichen UN-Kaufrecht 221, 223-24 (Ernst van Caemmerer & Peter Schlechtriem eds., 2d ed. 1995); Karollus, supra note 20, at 151.

132. Judgment of Sept. 17, 1991, OLG Frankfurt am Main, 1991 RIW at 951.

133. Judgment of Apr. 24, 1990, AG Oldenburg in Holstein, 1991 IPRax at 338.

134. Fritz Enderlein, Die Verpflichtung des Verkäufers zur Einhaltung des Lieferzeitraums und die Rechte des Käufers bei dessen Nichteinhaltung nach dem UN-Übereinkommen über Verträge über den internationalen Warenkauf,1991 IPRax 313, 315.

135. Judgment of Sept. 16, 1991, LG Frankfurt am Main, 1991 RIW at 953.

136. Id.

137. Judgment of Sept. 26, 1990, LG Hamburg, 1991 IPRax at 402.

138. Judgment of May 14, 1993, LG Aachen, 1993 RIW at 761.

139. Judgment of Sept. 26, 1990, LG Hamburg, 1990 IPRax at 402; Judgment of Feb. 22, 1994, OLG Köln, 1994 RIW at 973.

140. Judgment of Feb. 22, 1994, OLG Köln, 1994 RIW at 973.

141. Judgment of May 14, 1993, LG Aachen, 1993 RIW at 761.

142. See Ulrich Huber, Art. 31: Inhalt der Lieferpflicht und Ort der Lieferung, in Kommentar zum Einheitlichen UN-Kaufrecht 264, 269 (Ernst von Caemmerer & Peter Schlechtriem eds., 2d ed. 1995); Karollus, supra note 20, at 108; Piltz, supra note 52, at 1104.

143. The term frei Haus corresponds with a delivery agreed to be made FOB buyer's place of business.

144. Bringschuld is a term for the obligation to deliver at the buyer's place of business.

145. See Judgment of Nov. 20, 1992, OLG Karlsruhe, 1993 NJW-RR 1316.

146. Judgment of Apr. 24, 1990, AG Oldenburg in Holstein, 1991 IPRax 336.

147. See infra part V.8. For critical commentary on this case, see Enderlein, supra note 134, at 314.

148. Judgment of Apr. 20, 1994, OLG Frankfurt am Main, 1994 RIW 593.

149. For commentary on this issue, see C.M. Bianca, Article 35, in Commentary on the International Sales Law 268, 282-83 (C.M. Bianca & M.J. Bonell eds., 1987); Herber & Czerwenka, supra note 16, at 160; Ingeborg Schwenzer, Art. 35: Vertragsmäßigheit der Ware, in Kommentar zum Einheitlichen UN-Kaufrecht 320, 326-27 (Ernst von Caemmerer & Peter Schlechtriem eds., 2d ed. l995).

150. Judgment of Mar. 8, 1995, BGH, 1995 NJW 2099.

151. John Honnold, Documentary History of the Uniform Law for the International Sales 419, 421-22 (1989).

152. See, e.g., Schlechtriem, supra note 22, at 54; Ulrich Huber, Die Haftung des Verkäufers nach dem Kaufrechtsübereinkommen der Vereinten Nationen und nach deutschem Recht 11 (1991); Karollus, supra note 20, 105-06; Josef Aicher, Leistungsstörungen aus der Verkäufersphäre, in Das Einheitliche Wiener Kaufrecht 114-23 (Hans Hoyer & Willibald Posch eds., 1992); Piltz, supra note 21, at 117; Schwenzer, supra note 149, at 324.

153. See Diskussionsbeiträge, in Das UNCITRAL-Kaufrecht im Vergleich zum österreichischen Recht 133, 135, 147 (Peter Doralt ed., 1985); Loewe, supra note 17, at 51; Karl Neumayer & Catherine Ming, Convention de Vienne sur les contrats de vente internationale de marchandises (1993).

154. Judgment of Feb. 10, 1994, OLG Düsseldorf, 1994 RIW at 1051.

155. See BGB § 477.

156. See CISG, supra note 4, art. 39(1).

157. See LOEWE, supra note 17, at 60-61; Karollus, supra note 20, at 130-31.

158. Furthermore, German courts have considered the buyer's notice of non-conforming goods under ULIS Articles 38-40. Since ULIS and CISG concepts are very similar in this context, these decisions will be influential on CISG interpretation. Most of the decisions are published in Peter Schlechtriem & Ulrich Magnus, Internationale Rechtsprechung zu EKG und EAG 231-300 (1987).

159. See Handelsgesetzbuch [HGB] §§ 377-78.

160. Judgment of Feb. 10, 1994, OLG Düsseldorf, 1994 RIW at 1051.

161. Judgment of Jan. 8, 1993, OLG Düsseldorf, 1993 RIW at 325.

162. Id.

163. Judgment of Aug. 31, 1989, LG Stuttgart, 1990 IPRax at 317.

164. Judgment of Feb. 10, 1994, OLG Düsseldorf, 1995 RIW at 55.

165. But see Ingeborg Schwenzer, Art. 39: Mängelrüge, in Kommentar zum Einheitlichen UN-Kaufrecht 357, 361-62 (Ernst von Caemmerer & Peter Schlechtriem eds., 2d ed. 1995).

166. Judgment of Apr. 3, 1990, LG Aachen, 1990 RIW at 492.

167. Judgment of Aug. 31, 1989, LG Stuttgart, 1990 IPRax at 317.

168. Judgment of Feb. 10, 1994, OLG Düsseldorf, 199S RIW at 55.

169. Judgment of Jan. 8, 1993, OLG Düsseldorf, 1993 RIW at 325.

170. Judgment of Feb. 22, 1994, OLG Köln, 1994 RIW at 973.

171. Judgment of Jan. 8, 1993, OLG Düsseldorf, 1993 RIW at 325; Ulrich Magnus, Zum räumlich-internationalen Anwendungs bereich des UN-Kaufrechts und zur Mängelrüge, 1993 IPRax 390, 391-92 (1993).

172. Judgment of Aug. 14, 1991, LG Baden-Baden, 1992 RIW 62.

173. See supra part IV.5.

174. See Karollus, Rechtsprechung (II), supra note 58, at 169.

175. See Gesetz zur Regelung des Rechts der Allgemeinen Geschäftsbedingungen [AGBG] § 9.

176. See EGBGB art. 28.

177. Even if the clause would have been valid under Italian law, the German judge could still have held the clause invalid under the doctrine of ordre public (public policy).

178. Judgment of July 3, 1989, LG München I, 1990 IPRax 316.

179. Judgment of June 2, 1982, BGH, 1982 NJW 2730, 2731 (considering notice specificity requirements under ULIS).

180. Judgment of Aug. 31, 1989, LG Stuttgart, 1990 IPRax at 317; Judgment of July 13, 1994, LG Frankfurt am Main, 1994 NJW-RR at 1265.

181. CISG, supra note 4, art. 39(1). But see id. art. 40, 44.

182. Id. art. 46(2).

183. Id. art. 46(3).

184. A "hidden shortage" arises when the quantity of goods actually delivered is less than the contract amount, but the invoice or delivery documents incorrectly report delivery of the full amount. See Judgment of Jan. 8, 1993, OLG Düsseldorf, 1993 RIW at 325.

185. Id. See Herber & Czerwenka, supra note 16, at 186-87; Schwenzer supra note 165, 365-66; Ulrich Huber, Art. 51: Teilweise Nichterfüllung, in Kommentar zum Einheitlichen UN-Kaufrecht 507, 510 (Ernst von Caemmerer & Peter Schlechtriem eds., 1st ed. 1990). Contra Herbert Stumpf, Art. 39: Mängelrüge, in Kommentar zum Einheitlichen UN-Kaufrecht 335, 338 (Ernst von Caemmerer & Peter Schlechtriem eds., 2d ed. 1995) (stating that the buyer only has to pay for the quantity actually delivered).

186. The OLG Düsseldorf expressly stated that it did not want to treat this issue. Judgment of Jan. 8, 1993, OLG Düsseldorf, 1993 RIW at 325.

187. CISG, supra note 4, art. 40.

188. Id. art. 49(1)(b).

189. Id. art. 44(1)(a).

190. Judgment of Apr. 24, 1990, AG Oldenburg in Holstein, 1991 IPRax at 338.

191. See Enderlein, supra note 134, at 314-15.

192. See supra Part V.5.

193. One of the most controversial CISG issues is the definition of a fundamental breach in respect to defective goods, especially when the defect can be cured by substitute delivery or repair. See Honnold, supra note 1, §§ 184, 296; Michael Will, Article 48, in Commentary on the International Sales Law 347, 356-58 (C.M. Bianca & M.J. Bonell eds.,1987); Aicher, supra note 152, at 136-42; Martin Karollus, UN Kaufrecht: Vertragsaufhebung und Nacherfüllungsrecht bei Lieferung mangelhafter Ware, 1993 Zeitschrift für Wirtschaftsrecht 490; Peter Schlechtriem, Art. 25: Wesentliche Vertragsverletzung, in Kommentar zum Einheitlichen UN-Kaufrecht 207, 217-19 (Ernst von Caemmerer & Peter Schlechtriem eds., 2d ed. 1995); Huber, supra note 128, at 442-45.

194. Judgment of Feb. 10, 1994, OLG Düsseldorf, 1994 RIW at 1051. See Huber, supra note 128, at 449.

195. CISG, supra note 4, art. 49(1)(a).

196. Judgment of Feb. 10, 1994, OLG Düsseldorf, 1994 RIW at 1051.

197. Judgment of Apr. 20, 1994, OLG Frankfurt am Main, 1994 RIW at 595.

198. Judgment of Mar. 2, 1994, OLG München, 1994 RIW at 596.

199. Judgment of Sept. 17, 1991, OLG Frankfurt am Main, 1991 RIW at 951.

200. Judgment of Aug. 14, 1991, LG Baden-Baden, 1992 RIW 62.

201. CISG, supra note 4, art. 51(1).

202. Id. art. 51(2).

203. Annahmeverzug generally means delay or default in accepting contractual performance.

204. Judgment of Apr. 24, 1990, AG Oldenburg in Holstein, 1991 IPRax at 338. See BGB §§ 293-294.

205. See Enderlein, supra note 134, at 315.

206. See BGB § 433(2).

207. For a detailed analysis of risk-passing rules, see Reinhard Geist, Die Gefahrtragung nach dem UN-Übereinkommen über den internationalen Warenkauf, 1988 WBI 349.

208. Judgment of Jan. 24, 1994, KG Berlin, 1994 RIW at 683.

209. See BGB § 244; Judgment of Sept. 17, 1993, OLG Koblenz, 1993 RIW at 936. For ULIS requirements, see Judgment of Apr. 14, 1978, OLG Karlsruhe, 1978 RIW 544, 544-45. However, the interpretation of BGB § 244 and its application to sales contracts governed by CISG is very controversial. For a detailed analysis, see Ulrich Magnus, Währungsfragen im Einheitlichen Kaufrecht, 53 Rabels Zeitschrift für ausländisches und internationales Privatrecht [RabelsZ] 119 (1989).

210. See Reinhart, supra note 19, at 163; Judgment of Jan. 31, 1991, AG Frankfurt am Main, 1991 IPRax 345; Hans G. Leser, Art. 71: Verschlechterungseinrede, in Kommentar zum Einheitlichen UN-Kaufrecht 589, 596-97 (Ernst von Caemmerer & Peter Schlechtriem eds., 2d ed. 1995).

211. See Schlechtriem, supra note 22, at 87; Herber & Czerwenka, supra note 16, at 319; Piltz, supra note 21, at 172-73.

212. Judgment of Jan. 31, 1991, AG Frankfurt am Main, 1991 IPRax at 345.

213. See Victor Knapp, Article 74, in Commentary on the International Sales Law 538, 540 (C.M. Bianca & M.J. Bonell eds., 1987); Hans Stoll, Art. 74: Umfang des Schadenersatzes, in Kommentar zum Einheitlichen UN-Kaufrecht 623, 635-36 (Ernst von Caemmerer & Peter Schlechtriem eds., 2d ed. 1995); Enderlein et al., supra note 14, at 235; Karollus, supra note 20, at 213.

214. Judgment of July 2, 1993, OLG Düsseldorf, 1993 RIW at 845-46.

215. See Peter Schlechtriem, Kurzkommentar, 1993 EWiR 1075 (1993).

216. See also Stoll, supra note 213, at 635-36 (arguing that a party who has suffered damages from the other party's breach should be discharged from liability under the contract when the extent of damages is not calculable).

217. Judgment of Apr. 3, 1990, LG Aachen, 1990 RIW at 492.

218. Judgment of Sept. 17, 1993, OLG Koblenz, 1993 RIW at 936-37.

219. Judgment of Sept. 16, 1991, LG Frankfurt am Main, 1991 RIW at 954; Judgment of Jan. 18, 1994, OLG Frankfurt am Main, 1994 RIW at 241.

220. Judgment of Sept. 26, 1990, LG Hamburg, 1991 IPRax at 403 (referring to Herbert Asam & Peter Kindler, Ersatz des Zins-und Geldentwertungsschadens nach dem Wiener Kaufrechtsübereinkommen vom 11.4.1980 bei deutsch-italienischen Kaufverträgen, 1989 RIW 841, 844-45 (1989)).

221. Judgment of May 14, 1993, LG Aachen, 1993 RIW at 761.

222. Judgment of Sept. 17, 1993, OLG Koblenz, 1993 RIW at 937.

223. CISG, supra note 4, art. 7(2). Article 7(2) also -- and primarily -- provides for a gap-filling according to general principles. But, in the present case, that does not seem to be possible because the Vienna Conference failed to agree on any principles.

224. See Gert Reinhart, Fälligheitszinsen und UN-Kaufrecht, 1991 IPRax 376 (1991); Herber & Czerwenka, supra note 16, at 347; Karollus, supra note 20, at 227; Piltz, supra note 21, at 280-82; Hermann Eberstein & Klaus Bacher, Art. 78: Zinsen, in Kommentar zum Einheitlichen UN-Kaufrecht 665, 672-73 (Ernst van Caemmerer & Peter Schlechtriem eds., 2d ed. 1995)

225. See Judgment of Sept. 26, 1990, LG Hamburg, 1990 RIW at 1019; Judgment of June 13, 1991, OLG Frankfurt am Main, 1991 RIW at 591-92; Judgment of Jan. 18, 1994, OLG Frankfurt am Main, 1994 RIW at 241; Judgment of Mar. 2, 1994, OLG München, 1994 RIW at 596-97. See generally Judgment of Sept. 17, 1993, OLG Koblenz, 1993 RIW at 938; Judgment of Feb. 10, 1994, OLG Düsseldorf, 1994 RIW at 1051.

226. See Judgment of Sept. 17, 1993, OLG Koblenz, 1993 RIW at 938; Judgment of Feb. 10, 1994, OLG Düsseldorf, 1994 RIW at 1051.

227. Judgment of Sept. 16, 1991, LG Frankfurt am Main, 1991 RIW at 954. See Hans Stall, Inhalt und Grenzen der Schadensersatzpflicht sowie Befreiung con der Haftung im UN-Kaufrecht, im Vergleich zu EKG und BGB, in Einheitlichen UN-Kaufrecht und nationales Obligationenrecht 257, 279-80 (Peter Schlechtriem ed., 1987). See also Judgment of Aug. 31, 1989, LG Stuttgart, 1990 IPRax at 317-18; Judgment of Jan. 24, 1994, KG Berlin, 1994 RIW at 683-84 (neither decision making clear whether interest was granted according to Article 78 or damages according to Article 74).

228. Judgment of June 13, 1991, OLG Frankfurt am Main, 1991 RIW at 591-92.

229. See Hans Stoll, Internationalprivatrechtliche Fragen bei der landesrechtlichen Ergänzung des Einheitlichen Kaufrechts, in Festschrift für Murad Ferid 495, 509-10 (Andreas Heldrich et al. eds., 1988).

230. See Wolfgang Grunsky, Anwendbares Recht und gesetzlicher Zinssatz, in Festschrift für Franz Merz 147, 147-57 (Walter Gerhardt et al. eds., 1992).

231. Perez, supra note 21, at 281-82.

232. European Communities Convention on Jurisdiction and Enforcement of Judgments in Civil and Commercial Matters, Sept. 27, 1968, 8 I.L.M. 229 [hereinafter EC Convention]. For a contractual agreement on jurisdiction under Article 17 of the EC Convention and a cross-action and waiver of lack of jurisdiction under Article 18 of the EC Convention, see Judgment of Sept. 17, 1993, OLG Koblenz, 1993 RIW at 935.

233. CISG, supra note 4, art. 57(1)(a).

234. Case C-228/92, Custom Made Commercial Ltd. v. Stawa Metallbau GmbH, 1994 RIW 676 (1994).

235. See Honnold, supra note 151, at 589-90.

236. Judgment of July 2, 1993, OLG Düsseldorf, 1993 RIW at 845-46. See Piltz, supra note 52, at 1106.

237. See Huber, supra note 86, at 425-26.

238. For a collection of international decisions relating to ULIS and ULF, see Schlechtriem & Magnus, supra note 158.


Pace Law School Institute of International Commercial Law - Last updated October 9, 2008
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