1. For data on Article 62, see the Cross-reference editorial analysis of
Article 62 [not yet available].
2. Certain aspects of Article 28 are discussed below. For further data on
Article 28, see the Cross-reference editorial analysis of Article
28 [not yet available].
3. "[T]he remedy of obtaining an order from a court that a party perform the
contract" can be either "a limited remedy, which in many circumstances is
available only at the discretion of the court"; or "a remedy, available at the
discretion of the other party". Secretariat Commentary on Article 26 of the
CISG, Official Records, p. 27.
- Article 46(1), where not restricted, illustrates the latter approach. It
falls within the civil law tradition of enforcing the original promise, rather
than the common law tradition of preferring damages to equitable relief. It is
an expression of the maxim pacta sunt servanda. "Its purpose is to see
to it that the obligations of the seller are performed as laid down in the
contract and th[e] Convention." Michael R. Will, Commentary on the
International Sales Law, Cesare M. Bianca & Michael Joachim Bonell eds.
(Milan 1987) 334. For further comments on civil law contract theory, see
Richard M. Hyland, "Pacta sunt servanda: a meditation", 82 Cal. L. Rev.
410-419 (1994).
Article 46(1) is subject to an important restriction: Article 28. See also the
restrictions on a buyer's right to require repair or substitute goods that are
recited in Article 46(2) and (3).
4. Article 28 is a common law/civil law, market-economy/planned economy
compromise. For relevant citations, see the Roadmap to the legislative
history of Article 28. Article 28 links the right to obtain a judgment for
specific performance to the rules of the forum. It has been said this may have
the potential for mischief: "parties will be encouraged to forum-shop for a
national court system that will or will not grant specific performance". Amy
Kastely, "Rhetorical Analysis of the Convention", 8 NW J. Int'l L. 615
(1988). However, except perhaps when contracting with persons from planned
economies, this would seem unlikely.
- In practice, the difference in the manner in which civil law and common rules
of the forum on specific performance are implemented has been less of a common
law/civil law dichotomy than a market-economy/planned-economy
dichotomy:
"By contrast, the socialist principle of 'real performance' [has been] taken
seriously in the Eastern European countries with strictly planned economies.
For this, there are both political and economic reasons: since in a planned
economy contracts serve to implement plans, both the aggrieved party and the
nonperforming party would deviate from their planned tasks if the one does not
perform and the other does not insist on performance. Moreover, there is
usually no functioning market at which the aggrieved party can procure a
substitute performance." Ulrich Drobnig, "General Principles of European
Contract Law", International Sale of Goods [Dubrovnik Lectures], Petar
Sarcevic & Paul Volken eds. (Oceana 1986) 320-321.
Such reasoning on the part of delegates to the 1980 Vienna Diplomatic
Conference from Socialist countries (combined with civilian "pacta sunt
servanda" traditions) led to a reluctance to express the Conventions'
performance remedy in a common law manner. However, today with the shifts from
planned-economy regimes to market-economy regimes that have occurred in Eastern Europe
and elsewhere, to a common lawyer the practical consequences of living with a
specific performance text that is couched in a civilian manner is less
significant. Caveat: There remain important markets of the type described by Drobnig
in which, for the reasons he states, the performance remedy can be preferred
over damages. For an analysis of Chinese law and practice, see Jianming Shen,
"The Remedy of Requiring Performance Under the CISG and the Relevance of
Domestic Rules", 13 Ariz. J. Int'l & Comp. L. 282-302.
Where there is a concern over the possible scope of the remedy of specific
performance under the Convention, a response is to restrict the
right to compel performance by a suitable contract clause as permitted by
Article 6, or to include an appropriate forum selection clause in one's
contract.
5. The phrase "unless the court would do so under its own law" is said to refer
to "the domestic law of the forum and not its choice of law rules". Amy
Kastely, "Requiring Performance in International Sales", 63 Wash. L.R.
638 (1988); see also Peter Schlechtriem, Uniform Sales Law: The
UN-Convention on Contracts for the International Sale of Goods (Vienna
1986); and John O. Honnold, Uniform Law for International Sales under the
1980 United Nations Convention, 2d ed. (Kluwer 1991) 273.
Related issues have to do with the nature of Article 28, and whether it impacts
upon Article 46(2) and (3) as well as Article 46(1).
- Article 28 makes the granting of specific performance a matter of discretion
for judges in States whose national laws would not require specific
performance. It should be noted, however, that a judge in such a State
may order specific performance, since the language of Article 28 merely
provides that "a court is not bound to enter a judgement of specific
performance unless the court would do so under its own law . . ." (emphasis
added). "Article 28 does not require a court to apply its law to a contract
governed by the Convention; it simply allows the court to follow domestic law
if it so chooses." Amy Kastely, op. cit. at 638. Referring to the need
"to give effect to the international character of the contract and the need for
uniformity in the law governing international sales", Kastely would not regard
Article 28 as justifying the rejection of a claim for repair merely because it
is unknown as a remedy under domestic law, nor would Schlechtriem. Amy
Kastely, id. at 607; Peter Schlechtriem, op. cit. at 63, 76
n.293.
6. Secretariat Commentary on Article 42 of the 1978 Draft of the CISG, Official
Records, p. 38.
7. Official Records, pp. 396-397. Explanations for this statement by Professor
Honnold at the Diplomatic Conference are:
- Efforts had been made to change this conclusion prior to the Diplomatic
Conference. These efforts were unsuccessful. See UNCITRAL Yearbook VII,
A/CN.9/SER.A/1997, p. 9, commented on by E. Allan Farnsworth, "Damages and
Specific Relief", 27 Am. J. Comp. L. 250 (1949).
Professor Honnold's statement accompanied a further effort at the Vienna
Diplomatic Conference to get this conclusion changed. That effort was also
unsuccessful. Official Records, p. 332.
8. Domestic rules mitigating the right to compel performance are present in
many forums. As an example, in a forum in which the UCC is the domestic law,
it is highly unlikely that a court would enter a judgment for specific
performance in a situation in which the buyer could readily purchase
replacement goods elsewhere. Article 28 can in this manner "mitigate the
appearance of rigidity of the Convention's general rules on 'requiring
performance'." John O. Honnold, supra note 5 at 102-103. For further
references to relief from rigidity under national law via Article 28, see J.D.
Feltham, "The United Nations Convention on Contracts for the International Sale
of Goods", 1981 J. Bus. L. 359; and Peter Schlechtriem, supra
note 5 at 102-103 (German rules of the forum would relieve the inequities he
cites).
9. As an example, it has been said: "[T]he 'good faith' principle of Article 7
. . . may call for a restrained interpretation of the Convention's provisions
on compelling performance when a party seeks this remedy only after a delay
that permits him to speculate at the expense of the other party -- as when a
buyer seeks to compel delivery (rather than damages) only after a sharp rise in
the market . . ." John O. Honnold, supra note 5 at 365. "Such abus
de droit would be blocked under the rule of Article 7(1) that the
Convention shall be interpreted 'to promote the observance of good faith in
international trade' . . ." John O. Honnold, "Uniform Words and Uniform
Application. The 1980 Sales Convention and International Juridical Practice",
Einheitliches Kaufrecht und Nationales Obligationenrecht, Peter
Schlechtriem ed. (Baden-Baden 1987); see also Amy Kastely for other
applications of the principle of good faith (supra note 5 at 619-621);
and Treitel who states that the right to compel performance under the CISG "may
be affected by failure to mitigate on the ground that such a result follows
from the principle that the Convention is to be interpreted 'to promote . . .
the observance of good faith in international trade'". G. Treitel, Remedies
for Breach of Contract: A Comparative Account (Oxford 1988) 73-74. See as
well the reference to "loyalty to the other party to the contract" in Peter
Schlechtriem, "Recent Developments in International Sales Law", 28 Israel
L.R. 320-321 (1983) and by Lief Sevón in Honnold, "Uniform Words",
op. cit. at 139.
10. "In order for the buyer to exercise the right to require performance of the
contract, he must not have resorted to a remedy which is inconsistent with that
right, e.g. by declaring the contract avoided under [Article 49] or by
declaring a reduction of the price under [Article 50] . . . [However] [i]n
addition to the right to require performance of the contract . . the buyer can
recover any damages he may have suffered as a result of the delay in the
seller's performance." Secretariat Commentary on Article 42 of the 1978 Draft
of the CISG, Official Records, p. 38.
11. "Article 46(1) refers to 'performance by the seller of his obligations'.
Since 'his obligations' is unrestricted and general, it necessarily refers to
all of his obligations . . ." Michael R. Will, supra note 3 at 339.
12. Peter Winship, "Domesticating International Commercial Law: Revising UCC
Article 2 in Light of the UN Sales Convention", 37 Loyola L.R. 68
(1991).
13. Harry M. Flechtner, "Remedies Under the New International Sales
Convention", 8 J.L. & Com. 60-61 (1988).
14. John O. Honnold, supra note 5 at 163.
15. Jacob Ziegel, "The Remedial Provisions in the Vienna Sales Convention:
Some Common Law Perspectives", International Sales: The United Nations
Convention on Contracts for the International Sales of Goods, Nina M.
Galston & Hans Smit eds. (Matthew Bender 1984) Ch. 9 at 11-12. Cf.
"Mr. ROGNLIEN (Norway) [who] questioned whether existing 'usages' were in
themselves sufficient to be of assistance in that connection since the question
was not so much one of the buyer having the right to buy [comparable goods
elsewhere in lieu of compelling performance by seller], but rather of his duty
to do so rather than make an unreasonable demand for specific performance."
Official Records, p. 331.
16. Fritz Enderlein & Dietrich Maskow, International Sales Law
(Oceana 1992) 180.
17. Commentators' views on "circumstances that ought to be considered":
"The unreasonableness of repair does not depend on the character of the breach,
but rather on the nature of the goods delivered and all the other
circumstances. Certain goods by their very nature do not allow any repair at
all or, if they do, would require expenditure out of all proportion. When it
comes to all the other circumstances, regard must be given to both the seller's
and the buyer's interests . . . As for the buyer's circumstances, a typical
example of a circumstance to be considered would be the availability of
qualified repair locally. Where qualified personnel is particularly scarce, as
may be the case in some developing countries, the seller's inconvenience may
have to give way to the interests of the buyer". Michael R. Will, supra
note 3 at 338-339.
"A claim for repair may be unreasonable if there is no reasonable ratio between
the costs involved and the price of the goods or if the seller is a dealer who
does not have the means for repair . . ." Fritz Enderlein & Dietrich
Mascow, supra note 16.
18. For the definition of "fundamental breach" one must look to Article 25.
The concept of fundamental breach is applied to the right to request delivery
of the goods "to avoid hardship on the seller. He finds himself in the same
economic position as if the buyer had chosen avoidance of the contract under
Article 49. That is, the seller bears the risk of being unable to deliver
substitute goods or to dispose of the goods returned and of all transport costs
involved. Such a risk would hardly be justified as long as the defects are
only of minor importance . . ." Michael R. Will, supra note 3 at
337-338. See also, the Secretariat Commentary on Article 42 of the 1978 Draft
of the CISG, Official Records, pp. 38-39, para. 12.
The Article 46(2) restriction on the buyer's right to obtain substitute goods
like the restriction recited in Article 46(3), represents a concession to
efficiency concerns and a departure from the pacta sunt servanda ethos
that permeates the civil law conception of contract rights. See Karl-Heinz
Neumayer & Catherine Ming, Convention de Vienne sur les contrats de
vente interntionale de marchandises: Commentaire (1993) at 331, and in
particular n.6, citing critics of this restriction. On the other hand, where
such ethos can apply consistent with the wording of Article 46(2), there are
those who would apply it at the expense of a possible efficiency concern -- for
example, it has been said that where there is a lack of conformity of the goods
that constitutes a fundamental breach of contract, seller's ability to repair
the goods does not preclude the buyer's right to substitute goods ([la]
possibilité de réparer le défaut n'exclut pas non plus le
droit au remplacement.") See id. n.9, citing Lüderitz to this
effect. This is consistent with the statement in the Secretariat Commentary
that where the wording of the Convention's performance requirement is not
restricted, it "does not allow the seller to refuse to perform on the grounds
that . . . performance . . . would cost the seller more than it would benefit
the buyer". Secretariat Commentary on Article 42 of the 1978 Draft of the
CISG, Official Records, p. 38.
- Section 7-216(1) of the U.S. Uniform Commercial Code illustrates the former
approach ("Specific performance may be decreed where the goods are unique or in
other proper circumstances"). For similar common law reasoning, see the rules
of the forum in effect in Australia; they preclude specific performance unless
damages is deemed to be an inadequate remedy. Graham Corney, "Obligations and
Remedies Under the 1980 Vienna Sales Convention", Queensland Law Society
Journal (Feb. 1993) 45.
- Where it is the most practical alternative available, the rulings on a
request to enter a judgment for specific performance are apt to be similar in
both common law and civil law jurisdictions (Steven Walt, "For Specific
Performance Under the United Nations Sales Convention", 26 Texas Int'l L.
J. 233 (1991)); and in any event
"In the market-economy countries, an aggrieved party, especially in commercial
relations, usually will not bother with bringing a claim for performance,
waiting to obtain judgment and then attempting to levy execution. This would
be much too expensive in terms of time, effort and money. Rather, the
aggrieved party will procure a substitute performance and then claim damages.
In practice [the market-economy civilian] thus will act like his brother in
England or the United States.
- Treitel, Ziegel and Lookofsky are of the view that Article 28 also impacts upon Article 46(2) and
(3); Kastely and Honnold state that it does not. G.
Treitel, Remedies for Breach of Contract (Clarendon Press 1988) 44-45;
Jacob Ziegel, Report to the Uniform Law Conference of Canada on Convention
on Contracts for the International Sale of Goods (1981) 105; Joseph
Lookofsky, "The 1980 United Nations Convention on Contracts for the
International Sale of Goods", International Encyclopaedia of Laws,
Blainpain, gen. ed. (Kluwer 1993) 92; Amy Kastely, op. cit. at 635-637;
John O. Honnold, op. cit. at 366.
- The Secretariat Commentary that accompanied the provisions the delegates
considered at this Conference states: "The sanction provided by [Article 77]
against a party who fails to mitigate his loss only enables the other party to
claim a reduction in the damages". Secretariat Commentary on Article 73 of the
1978 Draft of the CISG, Official Records, p. 61.
"[I]t would be unreasonable to compel the seller to repair if repair is
technically unfeasible or if the cost of repair exceeds the diminution in value
to the buyer . . . caused by the defect . . . If the defect is not substantial
and repair is unreasonable, the buyer retains the right under Article 50 to
reduce the price to reflect any diminution in value . . These limitations on
the buyer's right to performance are designed to avoid economic waste where the
seller has substantially performed or where the cost of repair exceeds the
benefit to be gained." Amy Kastely, supra note 5 at 618-619.
Pace Law School Institute of
International
Commercial Law - June 1997