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LEGISLATIVE HISTORY
1980 Vienna Diplomatic Conference

Summary Records of Meetings of the First Committee

22nd meeting

Tuesday, 25 March 1980, at 3 p.m.

Chairman: Mr. LOEWE (Austria)

The meeting was called to order at 3.05 p.m.

CONSIDERATION OF ARTICLES 1-82 OF THE DRAFT CONVENTION ON CONTRACTS FOR THE INTERNATIONAL SALE OF GOODS AND OF DRAFT ARTICLE "DECLARATIONS RELATING TO CONTRACTS IN WRITING" IN THE DRAFT PROVISIONS PREPARED BY THE SECRETARY-GENERAL CONCERNING IMPLEMENTATION, DECLARATIONS, RESERVATIONS AND OTHER FINAL CLAUSES FOR THE DRAFT CONVENTION (agenda item 3) (A/CONF.97/5) (continued)

43(2)
Article 40 bis [became CISG article 43(2) ] (continued)
(A/CONF.97/C.1/L.129)

1. Mr. BENNETT (Australia) supported the new article 40 bis [became CISG article 43(2) ] proposed by the Federal Republic of Germany (A/CONF.97/C.1/L.129). Articles 39 and 40 [became CISG article 41 and CISG article 42 ] stated the seller's obligation to deliver goods free from any third-party right or claim and the liability that derived from it. The limitations to that liability of the seller were set out in article 40(3) and article 37 [became CISG article 43 and CISG article 39 ], according to which the buyer could not rely on the provisions of those articles if he did not give notice of the lack of conformity or of the third-party claim. As far as article 40 [became CISG article 42 ] was concerned, the situation was more awkward because the seller's obligations depended on the buyer's knowledge of the third-party claim. It was not clear why the buyer should be bound, under article 40(3) [became CISG article 43 ], to tell the seller what the latter already knew. Accordingly, he fully supported the proposal by the Federal Republic of Germany.

2. Mr. KRISPIS (Greece) expressed full support for the amendment by the Federal Republic of Germany as a useful supplement to article 39 [became CISG article 41 ]. The idea of the amendment was to complete the provision of article 40(2) [became CISG article 42(2) ] in a most logical manner.

3. The CHAIRMAN declared the debate on the question closed and put the amendment by the Federal Republic of Germany (A/CONF.97/C.1/L.129) to the vote.

4. The amendment by the Federal Republic of Germany was adopted.

48
Article 44 [became CISG article 48 ] (continued)
(A/CONF.97/C.1/L.80, L.140, L.141, L.142, L.146, L.148, L.160, L.164, L.203, L.213)

5. The CHAIRMAN said that the working group, consisting of the representatives of Bulgaria, Canada, the German Democratic Republic, the Federal Republic of Germany, the Netherlands, Norway and the United States of America, had submitted an amendment to article 44 [became CISG article 48 ] (A/CONF.97/C.1/L.213) and invited the Committee to consider it.

6. Mr. STALEV (Bulgaria) explained that the amendment was intended to guarantee the right of the seller to remedy a failure to perform while at the same time safeguarding the lawful interests of the buyer, who must be assured that the contract would be executed. That was the basic difference between it and the former text. If the proposal was adopted, his delegation would be ready to agree to the amendment by Pakistan to delete the remaining paragraphs.

7. The CHAIRMAN asked whether the various alternatives proposed in document A/CONF.97/C.1/L.213 had been ranked in order of preference, and whether the authors had tried to present the various points of view or whether they had decided to leave it to the Committee to settle the point in the last resort.

8. Mr. SCHLECHTRIEM (Federal Republic of Germany) explained that alternative III was intended to clarify alternative I and that in fact the two constituted a single proposal.

9. Mr. ROGNLIEN (Norway) said that alternative I should be voted on before alternative II. The double reference to article 45 [became CISG article 49 ] and fundamental breach as it appeared in the original text of article 44(1) [became CISG article 48(1) ], had been thought inappropriate; the working group had therefore tried to amend the wording of the first paragraph in two ways: alternative I deleted the reference to avoidance, while keeping the reference to fundamental breach. Alternative II, on the contrary, deleted the reference to the latter while making article 44 [became CISG article 48 ] subject to article 45 [became CISG article 49 ], since the buyer must retain the right to declare the contract avoided. In addition, the idea of unreasonable delay had been introduced instead of delay "not amounting to a fundamental breach". The proposed formula "unreasonable delay" was more flexible and offered a remedy, suspending the buyer's actual avoidance of the contract under article 45 [became CISG article 49 ]. With respect to paragraph 2 of alternative II, if the buyer had declared the contract avoided in accordance with article 45 [became CISG article 49 ], the seller had no means of remedy. Paragraph 2 of article 44 [became CISG article 48 ] provided for a period of time during which the buyer could not resort to any remedy which was inconsistent with performance by the seller. The provision had been kept in paragraph 2 of alternative II, but the rights of the seller had been limited, to the advantage of the buyer by a new reference to article 43 [became CISG article 47 ].

10. The CHAIRMAN asked the sponsors of the amendments to article 44 [became CISG article 48 ] submitted earlier if they wished to maintain their proposals or if they considered that joint amendment A/CONF.97/C.1/L.213 replaced them.

11. Mr. FARNSWORTH (United States), Mr. OZERDEN (Turkey), Mr. INAAMULLAH (Pakistan), Mr. ROGNLIEN (Norway), Mr. SEVÓN (Finland) and Mr. HOSOKAWA (Japan) said they wished to maintain their amendments (A/CONF.97/C.1/L.203, L.146, L.142 and L.80, L.141, L.164).

12. Mr. STALEV (Bulgaria) and Mr. HERBER (Federal Republic of Germany) withdrew their amendments (A/CONF.97/C.1/L.160, L.140).

13. Mr. KHOO (Singapore) explained that he would only withdraw his amendment if alternative II proposed in document A/CONF.97/C.1/L.213 was adopted.

14. Mr. FOKKEMA (Netherlands) said that he was in favour of alternative II.

15. Mr. KRISPIS (Greece) proposed that the words "Subject to article 45" [became CISG article 49 ] at the beginning of paragraph I of alternative II, which he thought unclear, should be replaced by the words "Subject to the contract not having been declared avoided in accordance with article 45 [became CISG article 49 ] ".

16. The CHAIRMAN proposed that the Committee should revert to the amendment suggested by Greece if alternative II was adopted.

17. Mr. HJERNER (Sweden) said that alternative I introduced conditions and new elements that were unacceptable to his delegation. Paragraph I of alternative II was still very close to the original wording of article 44 [became CISG article 48 ]; paragraph 2 on the other hand departed from paragraph 2 of article 44 [became CISG article 48 ], which concerned the case, frequently met with, in which the seller, having delayed in delivering the goods, asked the buyer whether he was nevertheless willing to accept delivery. He was therefore not in favour of paragraph 2 of alternative II.

18. The CHAIRMAN put alternative I of amendment A/CONF.97/C.1/L.213 to the vote.

19. Alternative I was rejected.

20. The CHAIRMAN put to the vote paragraph I of alternative II, which would replace paragraph I of article 44 [became CISG article 48 ].

21. Paragraph 1 of alternative II was adopted.

22. The CHAIRMAN put to the vote paragraph 2 of alternative II, which would replace paragraph 2 of article 44 [became CISG article 48 ].

23. Paragraph 2 of alternative II was rejected.

24. Mr. CUKER (Czechoslovakia) asked whether the Committee was to take a decision on the amendment suggested by the Greek representative to the wording of the new paragraph 1 of article 44 [became CISG article 48 ].

25. The CHAIRMAN noted that opinion in the Committee seemed to be divided, some delegations having spoken in favour of the new article 44 [became CISG article 48 ] in its present wording while other delegations seemed to want a change.

26. Mr. KRISPIS (Greece) wished it to be placed on record that, as far as his delegation was concerned, the words "Subject to article 45" [became CISG article 49 ] at the beginning of the new paragraph 1 of article 44 [became CISG article 48 ] should be understood as meaning: "Subject to the contract not having been declared avoided in accordance with article 45" [became CISG article 49 ].

27. Mr. CUKER (Czechoslovakia) associated himself with the Greek representative's comments. The new wording of paragraph 1 was open to a number of interpretations. It would therefore be desirable to refer the text to the Drafting Committee for the necessary modifications.

28. Mr. BONELL (Italy) did not share the views of the representatives of Greece and Czechoslovakia. The amendment proposed by Greece would alter the text of paragraph 1 of article 44 [became CISG article 48 ] considerably.

29. The CHAIRMAN said that, in view of the limited support for the Greek amendment, he would take it, if there was no objection, that the Committee wished to reject it.

30. It was so decided.

31. The CHAIRMAN drew the attention of the Committee to the amendment put forward by the United States delegation (A/CONF.97/C.1/L.203).

32. Mr. FARNSWORTH (United States of America) explained that his delegation had submitted its amendment because it seemed essential to include in the text a provision stating the right of the seller to remedy, in the manner chosen by him, his failure to perform his obligations. The Committee had amended article 42 [became CISG article 46 ] so that it should be quite clear that the buyer could, in the case of a fundamental breach, require the seller to perform, either through the delivery of substitute goods or by remedying the defect in the goods. It could happen, however, that the buyer might require performance in a certain manner whereas the seller would prefer to acquit himself of his obligations in another manner. The seller should therefore be permitted to determine the manner in which he intended to remedy his failure to perform. The United States amendment proposed two alternatives. The choice between the two was purely a drafting matter and should be left to the Drafting Committee.

33. The CHAIRMAN put the United States amendment (A/CONF.97/C.1/L.203) to the vote.

34. There were 10 votes in favour and 10 against.

35. The amendment was not adopted.

36. Mr. KHOO (Singapore) said that his delegation withdrew its amendment (A/CONF.97/C.1/L.148), since it no longer served any useful purpose after the adoption of new paragraph 1 for article 44 [became CISG article 48 ].

37. The CHAIRMAN invited the members of the Committee to consider the amendments proposed by Turkey (A/CONF.97/C.1/L.146) and Pakistan (A/CONF.97/C.l/L.198) deleting paragraphs 2, 3 and 4 in article 44 [became CISG article 48 ].

38. Mr. OZERDEN (Turkey) said that he wished to maintain his amendment, despite the adoption of new paragraph 1 in article 44 [became CISG article 48 ], because that paragraph expressly stated the means available to the seller to remedy failure to perform and implicitly indicated the procedure to be followed for that purpose. It was obvious that the seller should take action within a reasonable time. Paragraph 2 was therefore unnecessary. Paragraphs 3 and 4 were even more superfluous because the principles stated in them derived from contract law.

39. Mr. SEVÓN (Finland) was opposed to the deletion of the three paragraphs in question, since they were intended to settle the practical problems which often arose when a seller failed to perform his obligations.

40. Mr. ROGNLIEN (Norway) also objected to the deletion of those paragraphs, which were useful in that they stated very precisely the relation between the parties where the seller would remedy failure to perform after the date of delivery.

41. The CHAIRMAN noted that most of the members of the Committee were not in favour of the proposals by Turkey and Pakistan. If there were no objections, therefore, he would take it that the proposals were rejected.

42. It was so decided.

43. The CHAIRMAN suggested that the Norwegian amendment (A/CONF.97/C.1/L.142), which would combine paragraph 2, 3 and 4 of article 44 [became CISG article 48 ] to form an article 44 bis [became CISG article 48 ], should be referred to the Drafting Committee.

44. It was so decided.

45. The CHAIRMAN invited the members of the Committee to consider the amendments by Norway (A/CONF.97/C.1/L.80) and Finland (A/CONF.97/C.1/L.141) together, since, although submitted in separate documents, they were so similar that they could be considered a joint proposal.

46. Mr. SEVÓN (Finland) explained that his amendment (A/CONF.97/C.1/L.141) concerned a situation in which the seller requested the buyer to make known whether he would accept performance without indicating any time in his request. The amendment would allow the seller in such cases to perform his obligations within a reasonable time after the buyer had given notice of non-conformity.

47. Mr. HJERNER (Sweden) said he was opposed to the Finnish amendment. A similar proposal had been considered in 1977 and rejected by a large majority. It was necessary for the seller to state in his request the period of time within which he intended to perform his obligations.

48. Mrs. KAMARUL (Australia) supported the Finnish amendment, but suggested that the words "under article 37" [became CISG article 39] should be deleted.

49. Mr. FELTHAM (United Kingdom) was unable to accept the Finnish amendment. It was essential for the seller to make it clear in his request how much time he would need to perform his obligations if the buyer was not to be left in a state of uncertainty.

50. Mr. ROGNLIEN (Norway) pointed out that, if the seller failed to state the time within which he intended to perform his obligations, the buyer could let the seller's request remain unanswered and declare the contract avoided when the seller performed which would be unjust to the seller and even contrary to the principle of good faith. By introducing the idea of "reasonable time" the amendment would preclude any such injustice.

51. The CHAIRMAN, replying to a question by Mr. CUKER (Czechoslovakia), explained that the provisions of article 44 [became CISG article 48 ] would apply when the seller requested the buyer to allow him to remedy his failure to perform. The procedure provided for in paragraphs 2, 3 and 4 of that article gave the seller an assurance that the buyer would not declare the contract avoided and thus prevent the seller from remedying his failure to perform.

52. The CHAIRMAN put to the vote the joint proposal by Finland and Norway (A/CONF.97/C.1/L.80, L.141).

53. The proposal was rejected by 20 votes to 7.

54. The CHAIRMAN drew the attention of the Committee to the amendment by Japan (A/CONF.97/C.1/L.164). The first part of the amendment, which would modify article 44(1) [became CISG article 48(1) ], was no longer valid after the adoption of the new paragraph 1.

55. Mr. HOSOKAWA (Japan) orally revised his proposed new paragraph 2 bis by substituting the words "perform his obligations" for the words "do so". His amendment was intended to prevent the buyer from declaring the contract avoided in the event of delivery of non-conforming goods before the seller had had an opportunity to remedy failure to perform. The time allowed to the seller to make a request to that effect would be very short. The amendment would enable the seller to perform his obligations and would prevent the contract from being avoided in cases in which another solution was available, without weakening the position of the buyer in any way.

56. Mr. KLINGSPORN (Federal Republic of Germany) and Mr. STALEV (Bulgaria) supported the Japanese amendment.

57. Mr. FOKKEMA (Netherlands) said that he could not support the amendment, which would have the effect of placing the buyer who had received non-conforming goods, and was entitled to declare the contract avoided, in an uncertain position.

58. Mr. HOSOKAWA (Japan) said that he was prepared to withdraw his amendment.

59. The CHAIRMAN suggested that the amendment by Japan (A/CONF.97/C.1/L.161) should be considered in connection with article 45 [became CISG article 49 ].

60. It was so decided.

The meeting was suspended at 4.20 p.m. and resumed at 4.40 p.m.

49
Article 45 [became CISG article 49 ]
(A/CONF.97/C.1/L.149, L.153, L.161, L.162, L.165)

Paragraph 1(a)

61. Mr. KLINGSPORN (Federal Republic of Germany), replying to a question by the CHAIRMAN, said that the amendment submitted by the Federal Republic of Germany (A/CONF.97/C.1/L.153) to paragraph 1(a) was no longer valid in view of the new text adopted for article 44(1) [became CISG article 48(1) ].

Paragraph 1(b)

62. The CHAIRMAN asked the Committee if it considered that the amendment by Norway (A/CONF.97/C.1/L.151) was a drafting matter.

63. Mr. ROGNLIEN (Norway) said that would be the case if it was clearly understood that subparagraph (b) was concerned only with non-delivery and not with lack of conformity. In the case of failure by the seller to deliver, the buyer could fix an additional time for delivery, stating that otherwise he would declare the contract avoided. However the situation was not the same when there was a lack of conformity in goods delivered. If the Committee accepted his interpretation the amendment proposed would be a matter of drafting for purposes of clarification, but if not, it would have to be regarded as a substantive matter.

64. Mr. FOKKEMA (Netherlands) thought that the question was one of substance. He had submitted an amendment which took a completely different point of view from the Norwegian amendment, and it was for the Committee to decide which of the two interpretations was correct.

65. The CHAIRMAN suggested that consideration of the Norwegian amendment should be deferred.

66. It was so decided.

67. Mr. ZIEGEL (Canada) introduced the Canadian amendment (A/CONF.97/C.1/L.150) to paragraph 1(b). The purpose of the amendment was to rectify an apparent divergence between that subparagraph and article 43(1) [became CISG article 47(1) ], which he found difficult to understand. Article 43(1) [became CISG article 47(1) ] referred to the additional time allowed to the seller "for performance . . . of his obligations", which covered the whole range of obligations arising under the Convention and the contract, but article 45(1)(b) [became CISG article 49(1)(b) ] applied only to non-delivery of the goods by the seller. While it was in the interests of the buyer to give the seller additional time, after which he could declare the contract avoided if the seller failed to deliver the goods within the stated time, it might also be important for the buyer to be able to resort to the Nachfrist procedure if the goods were defective. That was why Canada proposed adding a reference to failure to perform "any other material obligation" in the existing text, which would then correspond to article 43(1) [became CISG article 47(1) ].

68. Mr. FOKKEMA (Netherlands) said that while the amendment proposed by his delegation (A/CONF.97/C.1/L.165) was not worded in quite the same way as the Canadian amendment, it was on the same lines and based on the same considerations. It was strange that under article 43 [became CISG article 47 ]the buyer was entitled to give the seller additional time to perform, whereas article 45 [became CISG article 49 ] did not give him any other right on the expiry of that time if the seller had not yet performed his obligations. The buyer should be able to declare the contract avoided because of failure to perform a material obligation as well as failure to make delivery.

69. Mr. HJERNER (Sweden) pointed out that the question raised by the Canadian representative had been under discussion for years. The restriction on the scope of subparagraph (b) in cases of non-delivery was perfectly sound because the situation was not the same as if the seller had delivered defective goods. In the latter case, the buyer would not be able to transform a simple breach into a fundamental breach by the mere fact of allowing the seller additional time. On the other hand, non-delivery should in all cases amount to a fundamental breach. If the buyer wondered whether enough time had been allowed for the breach to be considered fundamental, he could allow the seller additional time, at the end of which the breach would be fundamental and the buyer could declare the contract avoided.

70. The Canadian representative had asked why the additional time provided for in article 43 [became CISG article 47 ] paragraph 1 applied to the performance by the seller of all his obligations. It should be noted that, under paragraph 2 of that article, the buyer could not change his mind before the expiry of the time-limit or declare the contract avoided. The additional time might cover cases of non-conformity, but the provision did not have the same implications as article 45 [became CISG article 49 ]. It seemed to him that it was pointless to amend articles 43 and 45 [became CISG article 47 and CISG article 49 ].

71. Mr. SCHLECHTRIEM (Federal Republic of Germany) said that he shared the view of the Netherlands and Canadian representatives. The Nachfrist procedure was not intended to transform an insignificant breach into a fundamental breach. It was a question of defining what constituted a fundamental breach. The buyer did not always know, and if he accorded the seller an additional period of time, that gave him time to clarify the situation.

72. Mr. VINDING KRUSE (Denmark) said he was in favour of the Norwegian proposal, for there were still some doubts about the interpretation of paragraph 1(b). If the buyer had fixed an additional period of time, and if the seller had not delivered the goods within that period of time, the existence of a fundamental breach would have to be determined in accordance with subparagraph (a).

73. Mr. SAMI (Iraq) thought that the Arab text of the Canadian amendment did not correspond exactly to the English text, which created difficulties. He gathered that if the seller had not delivered the goods or had failed to perform all his material obligations and did not remedy such failure, the buyer could not for that reason declare the contract avoided. If the buyer fixed an additional period of time for performance by the seller, the latter could always say that he was going to perform his obligations. In other words, the buyer was deprived of the right to avoid the contract on the grounds of lack of conformity or late delivery, and the seller was given the advantage over him. He could not support the Canadian proposal and hoped that the original text of the subparagraph would be kept.

74. The CHAIRMAN said that there must be some misunderstanding, for the Canadian proposal had more or less the same aim as the Netherlands one and the two proposals were actually more favourable to the buyer than the existing text. Not only did failure to deliver the goods within the additional period of time fixed by the buyer enable him to declare the contract avoided, but he could also take that step if the seller had not performed all the material obligations for which the buyer had granted him an additional period of time for performance.

75. Mr. FOKKEMA (Netherlands) confirmed that the Chairman's interpretation was right. It was very hard to determine at what time a breach became fundamental, as was pointed out in the commentary on paragraph 1 of article 43 [became CISG article 47 ] (A/CONF.97/5, p.117, para.6). His amendment would make it clear that, once the buyer had fixed an additional period of time for performance by the seller, by the end of which it was essential for the former that the contract should have been performed, the seller must comply with that request and perform his obligations.

76. Mr. FARNSWORTH (United States of America) endorsed the Swedish representative's statements and agreed that it would be undesirable to amend the existing text. The Nachfrist procedure was aimed at enabling the buyer to clarify his position, but the buyer might also take advantage of that system to make a breach appear to be a fundamental breach, which would be undesirable.

77. Mr. KRISPIS (Greece) pointed out that if the buyer had fixed an additional period of time of reasonable length for performance by the seller, in conformity with article 43 [became CISG article 47 ], and the seller did not perform his obligations within that additional period of time, the buyer could invoke a fundamental breach within the meaning of article 45(1)(a) [became CISG article 49(1)(a) ]. There was therefore no reason to include, in subparagraph (b), the non-performance of obligations other than delivery of the goods as grounds for avoiding the contract. Personally, he hoped that the Committee would stick to the text proposed in the draft Convention.

78. Mr. SANCHEZ-CORDERO (Mexico) supported the Canadian and Netherlands proposals. Compared with the draft Convention, the version of paragraph 1(b)proposed by the Netherlands had the advantage of being more general.

79. Mr. SEVÓN (Finland) said that in countries where the Nachfrist procedure was unknown, the rules proposed by Canada and the Netherlands would certainly not be interpreted in the way indicated by the representative of the Federal Republic of Germany. For his country, the Canadian and Netherlands proposals simply meant that any breach of contract whatsoever could be declared a fundamental breach and that hence the buyer would have the right to avoid the contract for any breach by the seller whatsoever. It was out of the question to introduce such a radical change into the Convention at such a late stage in its preparation. Thus the Canadian and Netherlands proposals were quite unacceptable for his delegation.

80. Mr. ROGNLIEN (Norway) pointed out that under the terms of the present article 45 [became CISG article 49 ], the buyer could, in the case of failure to deliver dealt with in paragraph 1(b), by making use of the Nachfrist, invoke any delay to declare the contract avoided. That text was therefore satisfactory, and the Canadian and Netherlands proposals would only make for confusion in the entire system.

81. Mr. BOGGIANO (Argentina) noted that the Canadian proposal concerning failure to perform "material" obligations in effect referred back to article 45(1)(a) [became CISG article 49(1)(a) ] and was therefore superfluous. As for the Netherlands proposal, since it concerned the failure to perform any obligation, material or otherwise, it would enable the buyer to get round his obligation to invoke a fundamental breach by the seller in order to declare the contract avoided. He was therefore unable to support that proposal.

82. Mr. BORTOLOTTI (International Chamber of Commerce) considered that any change in the régime provided for in the draft Convention would be dangerous; the seller must be protected against any unjustified avoidance of the contract by the buyer. There was a risk that the amendment proposed by Canada and the Netherlands would allow a non-fundamental breach to be transformed into a fundamental breach, through the Nachfrist procedure. Any reference to the non-performance of "material" obligations would be tantamount to introducing into the Convention a third degree of gravity of breach, calculated indeed to sow confusion. In the interests of businessmen and bona fide buyers, it would be better to keep to the original text.

83. Mr. OLIVENCIA RUIZ (Spain) was of the same opinion. The buyer must not be authorized to invoke, in order to declare the contract avoided, failure to perform a "material" obligation, which had not been defined in the Convention. Article 45(1)(a) [became CISG article 49(1)(a) ], as proposed in the draft Convention, contained a general rule authorizing avoidance of the contract for a fundamental breach regardless of the period of time accorded for performance by the seller. Subparagraph (b) of that same article spelled out a subsidiary rule by which failure to deliver within the additional period of time fixed in accordance with paragraph (1) of article 43 [became CISG article 47 ] could be regarded as a fundamental breach. That text met the requirements and was the one which should be adopted.

84. Mr. FELTHAM (United Kingdom) said that he too was against the Canadian and Netherlands amendments, the effect of which would be to authorize the buyer to transform a lack of conformity, for example, into a fundamental breach. On the commodity market, the buyer might quite well avail himself of such a provision to avoid the contract as soon as prices moved against him.

85. Mr. ZIEGEL (Canada) explained that in submitting its amendment his delegation in no way intended to authorize the buyer to transform just any breach into a fundamental breach within the meaning of draft article 45(1)(a) [became CISG article 49(1)(a) ]. The words "material obligation" used in the amendment were to be understood in the sense of the "fundamental breach" referred to in draft article 45(1)(a) [became CISG article 49(1)(a) ]. He referred the Committee to the commentary on draft article 43 [became CISG article 47 ] (A/CONF.97/5, para. 6, p.117) and said the sole purpose of his country's amendment was to make it clear that, where the buyer had fixed an additional period of time of reasonable length for performance by the seller, non-observance of that time-limit would constitute a fundamental breach simply because, for the buyer, that period henceforth constituted a fundamental element of the contract.

86. The CHAIRMAN expressed surprise. If paragraph (1)(b) proposed by Canada was not intended to authorize a non-fundamental breach to be transformed into a fundamental breach, it was pointless, since the rule was already spelled out in subparagraph (a).

87. Mr. FOKKEMA (Netherlands) pointed out that it was often difficult to say straight away whether the loss suffered by the buyer constituted a fundamental breach, and it was for that reason that the fixation of an additional period of time made that period of time a fundamental factor. It would therefore be advisable to widen the sphere of application of draft article 45(1)(b) [became CISG article 49(1)(b) ] to give the buyer the necessary remedies when the seller disregarded his fundamental obligation arising from the additional period of time. For some delegations, draft article 45(1)(a) [became CISG article 49(1)(a) ] already met that need. If that was so, paragraph 1(b) of the draft article would itself be quite unnecessary.

88. Mr. ZIEGEL (Canada) requested that the debate should be adjourned in order to give him an opportunity of discussing with the Netherlands representative the possibility of submitting a joint proposal to the Committee.

89. Mr. PLANTARD (France) said he was opposed to any adjournment of the debate.

90. The Canadian motion to adjourn the debate was rejected.

91. The CHAIRMAN asked the representative of Canada if he would agree to his proposal (A/CONF.97/C.1/L.150) being reworded in accordance with the Netherlands proposal (A/CONF.97/C.1/L.165), provided the Netherlands representative inserted in the third line of his proposal, before the word "obligations", the word "material".

92. Mr. ZIEGEL (Canada) said he would.

93. Mr. FOKKEMA (Netherlands) agreed, in turn, to add the word "material" before the word "obligations" in his proposed text. Perhaps the Canadian and his own delegations might get some delegations to support their joint proposal if they added to their text a sentence along the following lines: "This provision does not apply where, after the expiry of this period of time, it is still necessary to decide whether or not the breach is fundamental". The Drafting Committee might be asked to consider that suggestion.

94. Mr. HJERNER (Sweden) thought that the Committee could not vote on such an important amendment when it had not been circulated in writing.

95. The CHAIRMAN put to the vote the joint Canadian and Netherlands proposal (A/CONF.97/C.1/L.165), amended by the addition of the word "material" in the third line, subject to any drafting changes.

96. The proposal was rejected by 31 votes to 9.

The meeting rose at 6 p.m.


Pace Law School Institute of International Commercial Law - Last updated January 29, 1999
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