| See also: | UNCITRAL Digest cases plus added cases Above plus annotations and added material |
The UNCITRAL Digest of case law on the United
Nations Convention on the International Sale of Goods [*]
A/CN.9/SER.C/DIGEST/CISG/55 [8 June 2004]
Reproduced with the permission of UNCITRAL
| ARTICLE 55
Where a contract has been validly concluded but does not expressly or implicitly fix or make provision for determining the price, the parties are considered, in the absence of any indication to the contrary, to have impliedly made reference to the price generally charged at the time of the conclusion of the contract for such goods sold under comparable circumstances in the trade concerned. |
DIGEST OF ARTICLE 55 CASE LAW
1. As has been revealed by the preparatory work, the interplay of articles 14 and 55 is one of the most delicate questions raised by the Convention.[1]
Priority of the intention of the parties
2. Court and arbitral decisions consistently find that for the application of article 55, as for other provisions of the Convention, one must refer first and foremost to the intention of the parties. Article 55 does not enable a judge or arbitrator to establish a price when it has already been determined,[2] or made determinable, by the contracting parties.[3] Article 55 of the Convention is likewise inapplicable when the parties have decided to make their contract subject to subsequent agreement on the price.[4]
Salvage of a contract specifying no price
3. In one case, a Supreme Court decided, with regard to the sale of aircraft engines, that an offer to sell had no force in the light of article 14 of the Convention because it did not contain the price of all types of aircraft engines among which the buyer could choose and that the contract was therefore invalid.[5] That decision seems to show that article 55 does not make it possible to give effect to a contract which is invalid owing to the absence of a price and that article 14 of the Convention thus prevails. Under that interpretation of article 55, the provision is applicable only if the contract of sale was validly concluded without a price.
4. On the other hand, one court invoked article 55 to determine the sale price of raw materials not agreed upon beforehand by the parties.[6] Equally, it appears that arbitrators, confronted with articles 14 and 55, give precedence to article 55 over article 14 and accept the responsibility of establishing the missing price with a view to rendering the contract effective.[7]
5. The price established by the judge or arbitrator is that "generally charged at the time of the conclusion of the contract for such goods sold under comparable circumstances in the trade concerned". While implementation of this provision should not give rise to any particular difficulties when the goods consist of raw materials or semi-finished products, it is a different matter when the contract deals with manufactured products. Thus, in a case involving the sale of aircraft engines, the Supreme Court of a State came to the conclusion that the price of aircraft engines could not be determined under article 55 because they have no market price as such.[8]
FOOTNOTES
* The present text was prepared using the full text of the decisions cited in the Case Law on UNCITRAL Texts (CLOUT) abstracts and other citations listed in the footnotes. The abstracts are intended to serve only as summaries of the underlying decisions and may not reflect all the points made in the digest. Readers are advised to consult the full texts of the listed court and arbitral decisions rather than relying solely on the CLOUT abstracts.
[Citations to cisgw3 case presentations have been substituted [in brackets] for the case citations provided in the UNCITRAL Digest. This substitution has been made to facilitate online access to CLOUT abstracts, original texts of court and arbitral decisions, and full text English translations of these texts (available in most but not all cases). For citations UNCITRAL had used, go to <http://www.uncitral.org/english/clout/digest_cisg_e.htm>.]
1. 1980 Vienna Diplomatic Conference, Summary Records of Meeting of the First Committee, 8th meeting, Monday, 17 March 1980. On the same question, see Digest, article 14.
2. CLOUT case No. 343 [GERMANY Landgericht [District Court] Darmstadt 9 May 2000; available at <http://cisgw3.law.pace.edu/cases/000509g1.html>]; CLOUT case No. 151 [FRANCE Cour d'appel [Appellate Court] Grenoble 26 April 1995, available online at <http://cisgw3.law.pace.edu/cases/950426f1.html>].
3. [ICC International Court of Arbitration, case No. 8324 of 1995; available at <http://cisgw3.law.pace.edu/cases/958324i1.html>]; CLOUT case No. 106 [AUSTRIA Oberster Gerichtshof [Supreme Court] 10 November 1994; available at <http://cisgw3.law.pace.edu/cases/941110a3.html>].
4. CLOUT case No. 139 [RUSSIA Arbitration Award case No. 309/1993 of 3 March 1995; available online at <http://cisgw3.law.pace.edu/cases/950303r1.html>].
5. CLOUT case No. 53 [HUNGARY Legfelsobb Bíróság [Supreme Court] 25 September 1992, available online at <http://cisgw3.law.pace.edu/cases/920925h1.html>].
6. CLOUT case No. 215 [SWITZERLAND Bezirksgericht [District Court] St. Gallen 3 July 1997, available online at <http://cisgw3.law.pace.edu/cases/970703s1.html>]. See on this case, Digest, article 14, no. 16.
7. See [ICC International Court of Arbitration, case No. 9819 of 1999; available at <http://cisgw3.law.pace.edu/cases/999819i1.html>] ("Sale without prior fixing of a price is common in international trade, as is shown by the Vienna Convention of 11 April 1980 on the international sale of goods (art. 55) [...]").
8. CLOUT case No. 53 [HUNGARY Legfelsobb Bíróság [Supreme Court] 25 September 1992, available online at <http://cisgw3.law.pace.edu/cases/920925h1.html>].
Pace Law School Institute of International Commercial Law - Last updated July 21, 2005