Germany 31 January 1991 Lower Court Frankfurt (Shoes case) [translation available (excerpt)]
[Cite as: http://cisgw3.law.pace.edu/cases/910131g1.html]
Primary source(s) for case presentation: Case text
DATE OF DECISION:
JURISDICTION:
TRIBUNAL:
JUDGE(S):
CASE NUMBER/DOCKET NUMBER: 32 C 1074/90-41
CASE NAME:
CASE HISTORY: Unavailable
SELLER'S COUNTRY: Italy (plaintiff)
BUYER'S COUNTRY: Germany (defendant)
GOODS INVOLVED: Shoes
Case law on UNCITRAL texts (CLOUT) abstract no. 51
Reproduced with permission from UNCITRAL
The plaintiff, an Italian manufacturer of shoes, demanded payment of the balance due under the contract with defendant, a German company. The contract provided for payment of 40% of the purchase price upon delivery and the balance within sixty days after delivery. The seller sent an invoice in September 1989 and shipped the goods in January 1989 [1990] but suspended delivery without notifying the buyer, who was forced to pay more tha[n] 40% of the purchase price upon delivery in order to obtain the goods.
The court held that the seller committed a breach of contract by suspending delivery without giving notice of the suspension to the buyer and set off the claim of the seller for the balance of the purchase price against the claim of the buyer for damages (art. 45(1)(b), 73(1) and 74 CISG).
Abstract from 14 Journal of Law & Commerce (1995) 228-229
Reproduced with permission from the Journal
Right of stoppage and duty to give notice, CISG, Articles 71(2) and (3). [Under the facts of this case,] the court need not decide whether, after the dispatch of the goods, reasonable doubts as to the solvency of the [buyer] . . . actually arose, which eventually could have caused the exercise of a right of stoppage [under CISG, Article 71(2)]; the right of stoppage, however, is connected with a duty to give notice under CISG, Article 71(3), pursuant to which the complaining party was obliged to inform the defending party of any doubts concerning the [buyer's] solvency if the [seller] intended to invoke the right of stoppage. Appropriate notices, however, have not been submitted [to the court] by the [seller]. Yet notice would have been a prerequisite for a justified exercise of the right of stoppage. The [buyer], therefore, is entitled to damages for the loss of profit [suffered when the [seller] interrupted delivery of the goods].
APPLICATION OF CISG: Yes [Article 1(1)(b)]
APPLICABLE CISG PROVISIONS AND ISSUES
Key CISG provisions at issue: Articles
Classification of issues using UNCITRAL classification code
numbers:
58B [Time for payment (buyer to pay when goods placed at buyer's disposition): seller not obliged to hand over goods until buyer pays price];
71B ; 71C1 [Grounds for seller's stoppage of goods in transit; Obligations of party suspending performance: immediately notify other party];
74A [General rules for measuring damages: loss suffered as consequence of breach] Descriptors:
Excerpt from Larry A. DiMatteo et al., 34 Northwestern Journal of International Law & Business (Winter 2004) 299-440 at 417
"The importance of notice is a general theme found throughout the CISG.[726] It is particularly
evident in Article 71(2). Failure to give proper notice under Article 71(2) results in the revocation
of an otherwise reasonable suspension of performance. A German court held that reasonable doubts
about the buyer's creditworthiness were not sufficient to overcome the seller's failure to give notice
pursuant to Article 71(3).[727] The court reasoned that if the seller wanted to exercise his right
of suspension, he was obligated to inform the buyer about any doubts regarding her creditworthiness
or ability to perform her duties and liabilities under the sales contract. Inasmuch as the seller did not
demonstrate that he gave any such notice and information to the buyer, he was not permitted to
suspend performance. Hence, notification is an absolutely necessary prerequisite for exercising the
right of suspension for anticipatory breach.[728]" 726. See, e.g., CISG, supra note 4, at arts. 18(3), 19(2), 21, 26, 27, 39, 43(1), 46(2), 47(1), 48,
63(2), 65(2), 71(3), 72(2), 73(2), 79(4), and 88(1). 727. AG Frankfurt 32 C 1074/90-41, Jan. 31, 1991, supra note 618. 728. Id. See generally Hof van Beroep Gent, 1997/AR/2235, Apr. 26, 2000 (Belg.), available at <http://cisgw3.law.pace.edu/cases/000426b1.html> [English translation by Benoit Samyn, translation edited by Sieg Eiselen]; Netherlands Arbitration Institute 2319, Oct. 15,
2002. 729. CISG, supra note 4, at art. 72.Classification of issues present
Editorial remarks
English: Unilex database <http://www.unilex.info/case.cfm?pid=1&do=case&id=25&step=Abstract>
German: Die deutsche Rechtsprechung auf dem Gebiete des internationalen Privatrechts im Jahre (IPRspr) 1991 No. 34 [70]; Schweizerische Zeitschrift für Internationales und Europäisches Recht [SZIER]/Revue suisse de droit international et de droit européen (1995) 274 [cited as 1 January 1991]
Italian: Diritto del Commercio Internazionale (1994) 849-850 No. 29
Polish: Hermanowski/Jastrzebski, Konwencja Narodow Zjednoczonych o umowach miedzynarodowej sprzedazy towarow (Konwencja wiedenska) - Komentarz (1997) 245
CITATIONS TO TEXT OF DECISION
Original language (German): CISG online website <http://www.cisg-online.ch/cisg/urteile/34.htm> [excerpt]; Praxis des internationalen Privat- und Verfahrensrechts (IPRax) 1991, 345; Die deutsche Rechtsprechung auf dem Gebiete des internationalen Privatrechts im Jahre (IPRspr) 1991 No. 34 [70]; Unilex database [excerpt] <http://www.unilex.info/case.cfm?pid=1&do=case&id=25&step=FullText>
Translation (English): Text presented below [Excerpt]
CITATIONS TO COMMENTS ON DECISION
English: Ferrari, International Legal Forum (4/1998) 138-255 [226 n.792 (scope of CISG: set-off issues)]; Karollus, Cornell Review of the CISG (1995) 51 [58, 73-74] [comments on Article 4 and Article 71 issues in the context of German case law on the CISG]; Lookofsky, Understanding the CISG in the USA [CISG/USA] (1995) 76 n.79, 90 n.202; Lookofsky, CISG/Scandinavia (1996) 93 n.91 n.94, 121 n.231; Bernstein/Lookofsky, CISG/Europe (1997) 93 n.76, 97 n.96, 117 n.234; Schlechtriem, Singapore Conference on International Business Law, September 1992: L.R. Penna (ed.), Current Developments in International Transfers of Goods and Services, Singapore (Butterworths) 1994, 132 n.80; Spanogle/Winship, International Sales Law: A Problem Oriented Coursebook (West 2000) [suspending performance 241-247 (this case at 245-246)]; Bernstein & Lookofsky, Understanding the CISG in Europe, 2d ed., Kluwer (2003) § 6-11, n.109; § 6-14 n.138; § 6-26 n.316; [2005] Schlechtriem & Schwenzer ed., Commentary on UN Convention on International Sale of Goods, 2d (English) ed., Oxford University Press, Art. 4 para. 22a Art. 71 para. 21; Schwenzer & Fountoulakis ed., International Sales Law, Routledge-Cavendish (2007) at p. 499
French: Neumayer/Ming, Commentaire, Lausanne (1993) Art. 71 n.29; Witz, Les premières applications jurisprudentielles du droit uniforme de la vente internationale (L.G.D.J., Paris: 1995) 107-108; Guilbeault, Les Cahiers de Droit (Québec 1997) 315 [360 n.213]
German: Jayme, Praxis des internationalen Privat- und Verfahrensrechts (IPRax) 1991, 345; Karollus, [österreichisches] Recht der Wirtschaft (öRdW) 1992, 168; Piltz, Int. Kaufrecht (1993) 172 No. 262 = Neue Juristische Wochenschrift (1994) 1101; Schlechtriem, Internationales UN-Kaufrecht (1996) 29 n.64, 148 n.229; Staudinger-Magnus (1994) Art. 4 No. 47, Art. 71 Nos. 46-47
Spanish: Piltz, La Ley (Buenos Aires: 5 September 1994) 1-4 n.34
Queen Mary Case Translation Programme
31 January 1991 [32 C 1074/90-41]
Translation [*] by Stefan Kuhm [**]
Edited by Camilla Baasch Andersen [**]
[...]
I. Extract from the reasoning for the decision
[...]
It is not necessary to decide whether or not it became apparent, after the [seller] had dispatched the goods, that there were in fact founded doubts about the creditworthiness of the [buyer] sufficient to entitle the [seller] to exercise his right to suspend the further delivery of the goods. Such a right of suspension is associated with a concurrent obligation of notification and information pursuant to Art. 71(3) CISG. If the [seller] wanted to exercise his right of suspension, the [seller] was obligated to inform the [buyer] about any existing or arisen doubts with regards to her creditworthiness or ability to perform her duties and liabilities under the sales contract. The [seller] has not demonstrated or given evidence that he gave any such notice and information to the [buyer]. Such a notification would have been an absolutely necessary prerequisite for exercising [seller]'s right of suspension for anticipatory breach.
In the light of the lack of such necessary notification and information, the [buyer] is entitled to claim for damages due to her loss of profit.
[...]
FOOTNOTES
* All translations should be verified by cross-checking against the original text. For purposes of this translation, the Plaintiff of Italy is referred to as [seller], the Defendant of Germany as [buyer].
** Stefan Kuhm is a Member of the Bar Association, Frankfurt a.M., and a Ph.D. candidate at Eberhard-Karls-Universität Tübingen. Camilla Baasch Andersen is a Fellow of Pace University School of Law and a Lecturer at Queen Mary, University of London.
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