1. The CHAIRMAN invited the Committee to take up article 29 and the amendment submitted by Iraq (A/CONF.97/C.1/L.107). The Netherlands amendment (A/CONF.97/C.1/L.120) had been withdrawn.
2. Mr. SAMI (Iraq) explained that his amendment (A/CONF.97/C.1/L.107) was intended to fill a gap in the article by specifying in subparagraph (a) that delivery was to be to the place indicated by the buyer or, if no such place was indicated, the buyer's place of business. The addition would make the position clear to both buyer and seller.
3. Mr. LEBEDEV (Union of Soviet Socialist Republics) said that the point was important, but was settled by the provisions of article 30(2) [became CISG article 32(2) ].
5. Mr. KRISPIS (Greece) agreed.
6. Mr. HJERNER (Sweden) suggested that delivery must be to a particular person, not to a place. In his view, the amendment would disturb the balance of article 29 [became CISG article 31 ].
7. The CHAIRMAN said that in view of the limited support for the amendment (A/CONF.97/C.1/L.107) he would, if there was no objection, consider it rejected.
8. It was so agreed.
9. The CHAIRMAN invited the Committee to take up article 30 [became CISG article 32 ] and the Australian amendment to paragraph 1 (A/CONF.97/C.1/L.101).
10. Mrs. KAMARUL (Australia) said that her delegation's amendment (A/CONF.97/C.1/L.101) was intended to remove a gap in the present text. Paragraph 1 referred only to the seller's obligation in cases in which he was bound to hand over the goods to a carrier, although there were cases in which the seller had to deliver the goods by any of several methods.
11. Mr. SEVÓN (Finland) considered that the Australian amendment would improve the text by introducing an element of obligation.
12. Mr. FELTHAM (United Kingdom) also supported the Australian amendment.
13. Mr. FARNSWORTH (United States) was in agreement with the substance of the Australian amendment but felt that the wording could be improved and suggested that the text should be referred to the Drafting Committee. He would prefer to say "pursuant to his obligations" rather than "pursuant to the contract or this Convention".
14. Mr. MANTILLA-MOLINA (Mexico) believed that the Australian amendment would considerably improve the wording of article 30(1) [became CISG article 32(1) ].
15. The CHAIRMAN said that, if there were no further comments, he would take it that the Committee agreed to approve the substance of the Australian amendment (A/CONF.97/C.1/L.101) and to refer the text to the Drafting Committee as suggested by the United States representative.
16. It was so agreed.
17. The CHAIRMAN said that in the absence of comments he would take it that the Committee agreed to adopt the article.
18. It was so agreed.
19. The CHAIRMAN invited the Committee to take up article 32 [became CISG article 34 ] and the amendment by Yugoslavia (A/CONF.97/C.1/L.114).
20. Miss VILUS (Yugoslavia), introducing the amendment (A/CONF.97/C.1/L.114), said that if it was felt necessary to include a reminder in the Convention that the seller was obliged to hand over to the buyer the documents relating to the goods at the time and place fixed by the contract, it should be made clear that the same obligation existed where the time and place were fixed by usage.
21. Mr. KRISPIS (Greece) supported the Yugoslav proposal but felt that the wording could be improved. The text of article 32 [became CISG article 34 ] with the Yugoslav amendment might seem to give the seller a choice between the time and place fixed by the contract and the time and place fixed by usage whereas the reference to usage was intended to cover cases in which the contract contained no clause on the subject of the time and place of handing over of the documents.
22. Mr. KIM (Republic of Korea) considered that the amendment was superfluous since the parties were bound under article 8 [became CISG article 9 ] to observe all relevant usages and that provision governed all the other articles of the draft, including article 32 [became CISG article 34 ].
23. Mr. SZÁSZ (Hungary) agreed. If a reference to usage were included in article 32 [became CISG article 34 ], a similar reference might have to be introduced in other articles to avoid giving the impression that usages were not necessarily to be observed in connection with the provisions of those articles.
24. Miss VILUS (Yugoslavia) said that in view of the lack of support for her amendment, she would withdraw it.
25. The CHAIRMAN said that, in the absence of further comments, he would take it that the Committee adopted article 32 [became CISG article 34 ] as it stood.
26. It was so agreed.
(A/CONF.97/C.1/L.73, L.74, L.82, L.102, L.115 and L.143)
27. The CHAIRMAN invited the Committee to take up article 33 [became CISG article 35 ] and the amendments by the Federal Republic of Germany (A/CONF.97/C.1/L.73), Australia (A/CONF.97/C.1/L.74), the Union of Soviet Socialist Republics (A/CONF.97/C.1 /L.82), Norway (A/CONF.97/C.1/L.102), Canada (A/CONF.97/C.1/L.115) and Singapore (A/CONF.97/C.1/L.143). As the Norwegian amendment (A/CONF.97/C.1/L.102) was not substantive, he suggested that it should be referred to the Drafting Committee.
28. It was so agreed.
29. Mr. SHORE (Canada), introducing the Canadian amendment, said that his proposed rewording would make it clear that the requirements of general and particular fitness set forth in the article applied only to a commercial seller, i.e., a seller who dealt in goods of the description supplied under the contract. That had long been a requirement in common law jurisdictions and any doubt concerning the retention of that requirement would give rise to serious difficulties.
30. The amendment would also spell out more fully the meaning of the concept of general fitness as used in paragraph 1(a) of the article. The comparable concept of "merchantability" in common law jurisdictions had attracted an enormous amount of litigation and in the absence of clearer guidance, similar difficulties might be encountered with the provisions of article 33(1)(a) [became CISG article 35(1)(a) ] if left unchanged.
31. Lastly, paragraph 2 of the existing text of article 33 [became CISG article 35 ] was much too favourable to the buyer. In particular, if the buyer had examined the goods or been given a sample, he should be deemed to have accepted the goods subject to such defects as a reasonable examination by him would have revealed. The ascribed knowledge of defects should be based on an objective standard, not a subjective one. The Canadian amendment would have introduced that element of objectivity.
32. Mr. FARNSWORTH (United States) saw merit in some parts of the Canadian revision of article 33 [became CISG article 35 ]. In particular, he welcomed the distinction made in paragraphs 1 and 2 between a seller of goods in general and a seller who regularly sold goods of a particular kind. If a manufacturer sold a piece of used machinery and not the goods which he manufactured, an American judge would not impose the same burdens on him as upon a seller who actually manufactured machines. He was less attracted by paragraphs 3 and 4 of the amendment.
33. Mr. FELTHAM (United Kingdom) noted that the formula "who deals in goods of the description supplied under the contract" had been used in United Kingdom legislation and had given rise to difficulties and had been replaced by the formula "sellers who sell goods in the course of business". Similar wording might profitably be used in the Canadian amendment.
34. Mr. MANTILLA-MOLINA (Mexico) proposed that the discussion on article 33 [became CISG article 35 ] should be suspended until the following meeting in order to give the representatives more time to study the amendments.
35. Mr. SHAFIK (Egypt) and Mr. KHOO LEANG HUAT (Singapore) supported that proposal.
36. The CHAIRMAN said that, in the absence of further comments, he would take it that the Mexican proposal was adopted.
37. It was so agreed.
(A/CONF.97/C.1/L.105, L.122 and L.147)
38. The CHAIRMAN invited the Committee to consider article 34 [became CISG article 36 ] and the amendments by Norway (A/CONF.97/C.1/L.105), Turkey (A/CONF.97/C.1/L.122) and Pakistan (A/CONF.97/C.1/L.147). He suggested that the Norwegian amendment (A/CONF.97/C.1/L.105), which was a drafting amendment, should be referred to the Drafting Committee.
39. It was so agreed.
40. Mr. ADAL (Turkey), introducing his amendment (A/CONF.97/C.1/L.122), said that the present text of article 34(1) [became CISG article 36(1) ] unduly favoured the buyer, in that it made the seller liable for lack of conformity at the time of the passing of risk even though the lack of conformity became apparent only after that time. In order to redress the balance, his delegation suggested that the concluding words of article 34(1) [became CISG article 36(1) ] should be replaced by the words: "if the lack of conformity becomes apparent within the time stipulated in the contract or within the customary period of time".
41. Mr. FELTHAM (United Kingdom) preferred the text of article 34(1) [became CISG article 36(1) ] as it stood and considered that the reference to a "customary period of time" would not be of great assistance.
42. Mr. SZÁSZ (Hungary) noted that the question dealt with in the Turkish amendment was covered in part by the provisions of articles 36 [became CISG article 36 ] and 37 [became CISG article 39 ]. Other aspects of the problem would be dealt with in the contract itself.
43. Mr. SEVÓN (Finland) could not support the amendment which would, he believed, alter the meaning of the provision.
44. The CHAIRMAN said that in view of the lack of support for the amendment (A/CONF.97/C.1/L.122), he would, in the absence of further comments, consider it rejected.
45. It was so agreed.
46. Mr. MEHDI (Pakistan) introduced his delegation's amendment to article 34(2) [became CISG article 36(2) ] (A/CONF.97/C.1/L.147).
47. After a brief procedural discussion in which Mr. MATHANJUKI (Kenya), Mr. VISCHER (Switzerland) and Mr. GHESTIN (France) took part, the CHAIRMAN noted that there appeared to be a consensus to suspend the discussion of article 34 [became CISG article 36 ] until the following meeting. If there were no objection, he would take it the Committee agreed to adopt that course of action.
48. It was so decided.
49. Mr. SHORE (Canada), introducing his delegation's amendment (A/CONF.97/C.1/L.116), said that the rationale of article 35 [became CISG article 37 ] clearly suggested that the seller's right to cure non-conformity of goods tendered before the time of delivery had elapsed was meant to include non-conformity of documents relating to the goods. There was a close relationship with articles 28 [became CISG article 30 ] and 32 [became CISG article 34 ] and his delegation's amendment aimed at explicating that link.
50. Mr. SHAFIK (Egypt), Mr. FELTHAM (United Kingdom) and Mr. FARNSWORTH (United States of America) supported the Canadian proposal.
51. Mr. SEVÓN (Finland) said that it was difficult to accept a reference to documents only in article 35 [became CISG article 37 ]. There were a number of other places where such a reference might be added, for example article 36 [became CISG article 38 ].
52. Mr. HJERNER (Sweden) inquired why the Canadian proposal was directed specifically to article 35 [became CISG article 37 ]. The Committee must adopt a consistent attitude towards similar situations in other articles.
53. Mr. SHORE (Canada) said that article 35 [became CISG article 37 ] dealt with the examination of documents, whereas article 36 [became CISG article 38 ] referred to the examination of goods.
54. Mr. HJERNER (Sweden) said that article 35 [became CISG article 37 ] dealt primarily with goods delivered before the date for delivery.
55. Mr. ROGNLIEN (Norway) suggested that article 37 [became CISG article 39 ] should also be considered.
56. Mr. KIM (Korea) said that the Canadian proposal should not be adopted too lightly. In certain cases it might prove hard to apply. If, for example, a seller shipped goods and the buyer wished to sell them in transit, the goods might be delivered before the delivery date and the missing element, the documents, might play an important role.
57. Mr. HERBER (Federal Republic of Germany) said he shared the hesitations which had been expressed. In addition to the consideration that the reference to documents might well be included in other articles, it should be noted that if the obligation in respect of documents was added to article 35 [became CISG article 37 ], perhaps other obligations should also be added: for example, if the seller had promised to obtain an authorization from a public authority for the operation of an installation, he should be under the same conditions to cure the defect. The point raised by Canada was, in his delegation's view, covered by the existing text and should not be specifically mentioned in order not to exclude other obligations from the scope of the article.
58. Mr. FARNSWORTH (United States of America) said it was true that subsequent articles referred to goods when the text might have referred to both goods and documents. However, he agreed with the Canadian delegation that article 35 [became CISG article 37 ] as it stood did not enable the seller to cure lack of conformity of documents, particularly since previous articles, for example article 34 [became CISG article 36 ], referred to lack of conformity in general. He wondered however whether the only way to correct the over-specific reference to goods in article 35 [became CISG article 37 ] was to add a reference to documents. An alternative solution would be to re-word it on the lines of article 34 [became CISG article 36 ] by omitting the words "in the goods delivered" from the text. That solution would not be open to the objections which had been raised by several speakers.
59. Mr. SHORE (Canada) said that he appreciated the United States proposal as an alternative solution.
60. Mr. STALEV (Bulgaria) supported the United States suggestion.
61. Mr. ROGNLIEN (Norway) said that in the 1964 ULIS Convention there had been a separate section entitled "handing over of documents", containing articles 50 and 51. ULIS article 50 had been incorporated in article 32 of the draft Convention [became CISG article 34 ] but article 51 had only been partly covered. However, since remedies for breach of contract were neutral or consolidated, no problem in respect of documents arose in that connection. The problem lay with articles 33 [became CISG article 35 ] and subsequent articles, in particular articles 36 [became CISG article 38 ] and 37 [became CISG article 39 ]. One solution was to draft a new article dealing specifically with documents.
The meeting was suspended at 8.45 p.m. and resumed at 9 p.m.
62. Mr. SZÁSZ (Hungary) said that section II did not make adequate provision for documents. He supported the United States improvement to article 35 [became CISG article 37 ] but that would not completely solve the problem. A comparison of the titles of sections I and II showed that whereas section I was called "delivery of the goods and handing over of documents", section II was merely entitled "conformity of the goods" and even without the express mention of goods in article 35 [became CISG article 37 ], it would still be generally understood to refer to goods and not to documents. Parallel provisions would be required to cover documents; the effect could not be achieved by mere deletion in article 35 [became CISG article 37 ] and mutatis mutandis in articles 36 [became CISG article 38 ] and 37 [became CISG article 39 ].
63. Mr. KRISPIS (Greece) said that he doubted whether the United States formulation would cover the intention of the Canadian amendment owing to the structure of the original text. However, the United States suggestion was helpful and he would support it.
64. Mr. PLUNKETT (Ireland) said that, if there was support for the general idea underlying the Canadian proposal, the possibility might be considered of formulating a definition of goods which would, under certain circumstances, make it possible for the term "goods" to be understood as including documents. That would obviate the need to insert a reference to documents in a number of articles.
65. Mr. KHOO (Singapore) said it was clear that the whole group of articles dealt with goods as opposed to documents. An endeavour to graft a mention of documents on to any article in section II would not prove satisfactory. The matter of documents must be dealt with either in section I or by means of separate articles in section II, widening its scope.
66. Mr. MANTILLA-MOLINA (Mexico) said he did not believe the Hungarian representative's objection to be insuperable. What was required was a change of title in section II to refer to both goods and documents. He would then prefer the United States suggestion for modifying the text as being the simpler solution. The only alternative was to accept the text as it stood and retain the present title for the section.
67. Mr. VISCHER (Switzerland) said that the United States suggestion would not serve in the context of the articles. He preferred the Canadian proposal. Article 32 [became CISG article 34 ] clearly said that the seller had an obligation to hand over documents in the form required by the contract. Article 35 [became CISG article 37 ] dealt with a special case -- the cure of a lack of conformity prior to date of delivery -- the only case where cure of defect was possible by the seller. It was logical that cure should relate to documents as well as goods, but it must be so stated explicitly.
68. Mr. KIM (Korea) said that the date of delivery for the goods did not necessarily coincide with the time within which the seller might cure deficiency in the documentation. Article 32 [became CISG article 34 ] stated the the seller was bound to hand over the documents at the time required by the contract. It therefore did not exclude the possibility that the seller might cure a lack of conformity in the documents even though it made no explicit reference to the matter. His delegation opposed the amendment to article 35 [became CISG article 37 ] owing to the difficulty of timing.
69. The CHAIRMAN suggested that a vote should be taken on both the Canadian amendment (A/CONF.97/C.l/L.116) and the United States oral proposal.
70. The Canadian amendment was adopted by 20 votes to 11.
71. The United States oral proposal was rejected by 9 votes to 8.
72. Mr. ROGNLIEN (Norway) said he had voted for the Canadian amendment on the understanding that the same words would be added in articles 36 [became CISG article 38 ] and 37 [became CISG article 39 ].
73. Mr. SAMI (Iraq) pointed out that there were a number of discrepancies between the Arabic and the French texts of article 35 [became CISG article 37 ].
74. The CHAIRMAN said that the Arabic text would be reviewed. He took it that the Committee wished to send the amended article 35 [became CISG article 37 ] to the Drafting Committee, with a request to consider modifying the title of section II.
75. Mr. SHORE (Canada), introducing his delegation's amendment (A/CONF.97/C.1/L.118), said article 36 [became CISG article 38 ] was concerned with the time and place of the buyer's examination of the goods after delivery. The buyer's right to complain of non-conforming goods might be lost if he did not comply with article 36 [became CISG article 38 ] whereas under Canadian common law sales rules the buyer lost only his right of rejection by failure to conduct a reasonable examination of goods. There were two shortcomings in article 36 [became CISG article 38 ]: the requirement in paragraph 1 to examine the goods "within as short a period as is practical" was too severe, except for a few items, and did not reflect modern merchandising practices. The term "reasonable period of time" struck a better balance between the conflicting interests of buyer and seller. Paragraph 2 did not take into account the common situation in which a buyer stored goods and resold them in their original packaging to another buyer. The buyer might have had an opportunity to examine the goods but having regard to the circumstances, it would not be reasonable to expect him to do so before reselling. Paragraph 3 was arguably ambiguous enough to embrace that type of transshipment but that should not be taken for granted. The Canadian delegation had taken the opportunity to enlarge the paragraph 1 by clarifying the buyer's rights with regard to the time, place and manner of examination.
76. The CHAIRMAN suggested that the Canadian proposal should be discussed paragraph by paragraph, beginning with the proposed new article 36(a) [became CISG article 38(a) ].
77. It was so agreed.
78. Mr. DATE-BAH (Ghana) said he could support the Canadian proposal for article 36(a) [became CISG article 38(a) ].
79. Mr. BONELL (Italy) preferred the existing wording although he had no strong feelings on the subject. He suggested that, as a consequential amendment in the light of the decision on article 35 [became CISG article 37 ], the phrase "or any documents relating thereto" should be added after the phrase "examine the goods".
80. Mr. ROGNLIEN (Norway) supported that suggestion. He preferred the original wording to the less precise formulation "within a reasonable period of time" used in the Canadian proposal. The final part of the subparagraph, following the word "delivery", was superfluous, since the main point was to indicate the buyer's duty, not to explain in detail how he could carry out the examination.
81. Mr. FELTHAM (United Kingdom) said that in the light of the sponsor's explanations he could support the Canadian proposal.
82. Mr. MANTILLA-MOLINA (Mexico) said he would be able to support the Canadian proposal if the last part of the paragraph, following the word "delivery", were deleted. He was not in favour of including a reference to documents. Examination of the goods was essential to ensure they were in conformity with the contract, whereas examination of documents was an entirely different matter.
83. Mr. GHESTIN (France) was prepared to accept the Canadian formulation "within a reasonable period of time", since it was fairly close to the formulation used in the legal systems of France, Belgium and the Netherlands, but shared the view that the last part of the paragraph was unnecessary and involved undue repetition of the word "reasonable."
84. Mr. MICHIDA (Rapporteur) observed that the wording of paragraph (1) of article 36 [became CISG article 38 ] had been discussed over many years in UNCITRAL. Although the Canadian version might sound reasonable, it would be difficult to apply in practice, notably in the case of perishable goods such as fish, meat or vegetables. The existing phrase "within as short a period as practicable in the circumstances" gave the trader in such goods a clear point of reference. In contrast, the phrase "within a reasonable period of time" was vague and did not underline the need for the period to be kept short. Since the present formulation could be applied equally well to perishable and to durable goods, he would prefer to keep it.
85. Mr. HJERNER (Sweden) shared that view. The Canadian representative had explained that his proposal was intended to cover the case of packaged goods that needed to be unpacked within a certain period, but that contingency was covered by the phrase "as short a period as is practicable in the circumstances", which had the advantage of drawing attention to the need for prompt action. He was not at all clear as to the meaning of the last part of the paragraph and preferred the original text.
86. Mr. SEVÓN (Finland) shared the previous speaker's misgivings. The last part of the paragraph might be interpreted as indicating that the buyer could examine goods before delivery, which would open unlimited possibilities for litigation on the question of what was or was not reasonable.
87. Mr. SHORE (Canada) pointed out that [article] 36 (a) [refers to proposed amendment to the provision that became CISG article 38(1) ] specified that goods should be examined "following their delivery". The word "reasonable" was mentioned several times in order to take into account the fact that in Canadian legislation that word was applied in several different contexts, not only to buyers and sellers but also to time periods and to the goods themselves. If the last part of the paragraph, "and may examine them at any reasonable time and place and in any reasonable manner", caused difficulty, he was willing to withdraw it.
88. Mr. MASKOW (German Democratic Republic) was somewhat surprised that the Canadian representative should be seeking to introduce an entirely new concept which did not correspond to the approach used hitherto in the Convention. The proposal was a very far-reaching one to put forward at such a late stage. It had been suggested that a reference to documents should be added to article 36(1) [became CISG article 38(1) ] as a consequential amendment, but he felt the addition would cause difficulties because it would suggest that documents would be treated in a different manner from goods.
89. Mr. HERBER (Federal Republic of Germany) also favoured the existing text. It should be borne in mind that the main purpose of article 36 [became CISG article 38 ] was to ensure that the buyer examined the goods as soon as possible. Article 37 [became CISG article 39 ] allowed for an additional period in which the buyer could give notice to the seller of his findings, and it was in that context that the concept of a "reasonable period" was appropriate. He supported the view of the representative of the German Democratic Republic in regard to the question of the addition of a reference to documents.
90. Mr. REISHOFER (Austria) considered that the word "reasonable" was too vague, and accordingly preferred the original wording.
91. Mr. DATE-BAH (Ghana) noted that the Indian proposal was very close to the Canadian proposal and suggested that the two might be combined into a single text.
92. Mr. SHORE (Canada) accepted that suggestion. Article 36 (a) [refers to proposed amendment to the provision that became CISG article 38(1) ] would thus read: "The buyer must examine the goods, or cause them to be examined, within a reasonable period of time in the circumstances, following their delivery."
93. The CHAIRMAN said that as there appeared to be a majority against the revised Canadian proposal for a new article 36(a) [refers to proposed amendment to the provision that became CISG article 38(1) ](A/CONF.97/C.1/L.118), he would, in the absence of further comments, consider the proposal rejected.
94. It was so agreed.
95. The CHAIRMAN suggested that the Italian representative's proposal to add the words "or any documents relating thereto" after the phrase "examine the goods" in article 36(1) [became CISG article 38(1) ] should be forwarded to the Drafting Committee.
96. It was so agreed.