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Source: Doc. B(1) Reproduced from UNCITRAL Yearbook VIII (1977), A/32/17, pages 25-64

EXCERPT FROM ANNEX I

Report of Committee of the Whole I relating to the
draft Convention on the International Sale of Goods

[...]

CISG
number
Art. 73

Article 48

421. The text of article 48 as adopted by the Working Group on the International Sale of Goods, is as follows:

"(1) If, in the case of a contract for delivery of goods by instalments, the failure of one party to perform any of his obligations in respect of any instalment gives the other party good reason to fear a fundamental breach in respect of future instalments, he may declare the contract avoided for the future, provided that he does so within a reasonable time.
"(2) A buyer, avoiding the contract in respect of future deliveries, may also, provided that he does so at the same time, declare the contract avoided in respect of deliveries already made if, by reason of their interdependence, deliveries already made could not be used for the purpose contemplated by the parties in entering the contract."

Avoidance of the contract in respect of a single instalment

422. The Committee considered a proposal that the following paragraph be added to article 48 as paragraph (1) and that the current paragraphs (1) and (2) be renumbered as paragraphs (2) and (3):

"(1) In the case of a contract for delivery of goods by instalments, if the failure of one party to perform any of his obligations in respect of any instalment constitutes a fundamental breach with respect to that instalment, the other party may declare the contract avoided with respect to that instalment."

423. Support for this proposal was based on the fact that there is no provision enabling the seller to avoid a part of the contract equivalent to article 32 which permits the buyer to do so. It was generally considered that such a provision was useful since, if the buyer's performance is seriously deficient with respect to one instalment, the seller should be permitted to refuse his counter-performance in respect of that instalment even though the failure in respect of that instalment did not give him good reason to fear a fundamental breach in respect of future instalments.

424. However, under another view the right to declare the contract avoided under article 45(1)(a) was sufficient protection for the seller.

425. The Committee adopted the proposal to enable the seller to make partial avoidance of an instalment contract. The Committee also decided to make an appropriate change to the caption to section I of chapter V to reflect this decision.

Paragraph (2)

426. The Committee adopted a proposal which would permit a buyer, who avoids a contract with respect to one delivery, to avoid the contract with respect to other deliveries already made or to be made in the future if the interdependence of that delivery with the deliveries already made or to be made prevents those goods from being used for the purpose contemplated by the parties at the time of the conclusion of the contract.

Decision

427. The Committee concludes that a new paragraph (1) and an amendment to paragraph (2) should be adopted with a consequent change in the caption to section I of chapter V. The Committee recommends that the order of articles 48 and 49 be reversed. It therefore recommends that the Commission should adopt the following text, now renumbered as article 50:

"Article 50

"(1) In the case of a contract for delivery of goods by instalments, if the failure of one party to perform any of his obligations in respect of any instalment constitutes a fundamental breach with respect to that instalment, the other party may declare the contract avoided with respect to that instalment.
"(2) If one party's failure to perform any of his obligations in respect of any instalment gives the other party good grounds to conclude that a fundamental breach will occur with respect to future instalments, he may declare the contract avoided for the future, provided that he does so within a reasonable time.
"(3) A buyer, avoiding the contract in respect of any delivery, may, at the same time, declare the contract avoided in respect of deliveries already made or of future deliveries if, by reason of their interdependence, those deliveries could not be used for the purpose contemplated by the parties at the time of the conclusion of the contract." [page 55]

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Pace Law School Institute of International Commercial Law - Last updated July 27, 2007
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