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[Exclusions from the CISG]
[Article 4]

Apart from th[e] exclusions in Article 4, other issues not governed by the CISG include the legal capacity of corporations [LG Hamburg 26 September 1990; OLG Düsseldorf 8 January 1993],[89] assignment of claims [KG Berlin 24 January 1994],[90] assumption of debts [LG Hamburg 26 September 1990],[91] set-off of reciprocal obligations [AG Frankfurt 31 January 1991; OLG Koblenz 17 September 1993],[92] and issues of agency [LG Hamburg 26 September 1990; KG Berlin 24 January 1994].[93]

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Go to entire text of Karollus commentary

FOOTNOTES

* Professor of Law at the University of Bonn, Germany, from 1992 to February 1995. Currently, Professor of Law at the University of Linz, Austria. Address: Institut für Handels-und Wertpapierrecht, Universität Linz, A-4040 Linz-Auhof, Austria, Europe.

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89. Judgment of Sept. 26, 1990, LG Hamburg, 1991 IPRax 400; Judgment of Jan. 8, 1993, OLG Düsseldorf, 1993 RIW 325.

90. Judgment of Jan. 24, 1994, KG Berlin, 1994 RIW 683.

91. Judgment of Sept. 26, 1990, LG Hamburg, 1991 IPRax at 402.

92. Judgment of Jan. 31, 1991, AG Frankfurt am Main, 1991 IPRax 345; Judgment of Sept. 17, 1993, OLG Koblenz, 1993 RIW at 937.

93. Judgment of Sept. 26, 1990, LG Hamburg, 1991 IPRax at 401; Judgment of Jan. 24, 1994, KG Berlin, 1994 RIW 683. But see infra part IV.1.

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[Examination of the goods and notice of non-conformity: German court rulings in this case and other CISG cases]
[Article 38 and 39]

Unsurprisingly, the buyer's notice to the seller of non-conforming goods is an important issue.[158] Most important are timeliness, specificity, and the consequences of delay. CISG Article 44 has not been discussed by German courts, probably because German law contains similar provisions concerning the notice of non-conformity, which makes it unlikely that German courts would accept the existence of a "reasonable excuse" for not meeting the notice requirements at all.[159]

Notice is required in all cases of non-conformity contemplated in Article 35, including the delivery of goods of another kind [OLG Düsseldorf (6 U 119/93) 10 February 1994] [160] and the delivery of a minor quantity [OLG Düsseldorf 8 January 1993].[161] Under CISG Article 39(1), notice is due within a reasonable time after the non-conformity of the goods is discovered or ought to have been discovered. The buyer must examine the goods according to Article 38. The notice period begins to run when the buyer could have discovered the defect during a proper examination, whether the buyer did not actually discover the lack of conformity because he did not examine the goods properly or because he did not examine them at all. Given the opportunity for a proper examination and where the lack of conformity could have been discovered, a notice made seven days [OLG Düsseldorf 8 January 1993],[162] sixteen days [LG Stuttgart 31 August 1989],[163] or more than two months [OLG Düsseldorf (6 U 32/93) 10 February 1994] [164] after delivery is considered delayed.[165] In contrast, the notice is timely if the buyer examines the goods on the day of delivery and dispatches the notice on the day after [LG Aachen 3 April 1990].[166]

The courts have tried to define the requirements of a proper examination. For example, a proper examination will allow: the buyer of shoes to discover that they are losing color and that the workmanship is bad [LG Stuttgart 31 August 1989],[167] the buyer of shirts to discover that the style is not correct [OLG Düsseldorf (6 U 32/93) 10 February 1994],[168] and the buyer of pickled cucumbers to discover that the quantity is not correct [OLG Düsseldorf 8 January 1993].[169] Generally, the examination must be made when the goods arrive at the place of delivery. However, if the seller knew that the goods were to be redirected, the examination can be deferred until the goods have arrived at their final destination under Article 38(3) [OLG Köln 22 February 1994].[170] Under Article 6, the parties can agree to substitute other examination requirements for these default rules [OLG Düsseldorf 8 January 1993].[171]

Any other modification of Articles 38-44 is possible under Article 6; the parties can intensify or mitigate the burden of notice. The LG Baden-Baden considered an intensification, where the general contract conditions of an Italian tile seller provided that notice of a non-conformity must be provided within thirty days of the invoice date [Baden-Baden 14 August 1991].[172] The buyer, to justify his failure to provide notice within the thirty-day period, claimed that the non-conformity of the tiles was not discoverable upon examination. The LG Baden-Baden decided that the buyer had lost his right to rely on the lack of conformity.

This holding is correct if the clause was valid and had become part of the contract.[173] However, since the clause did not distinguish between discoverable and non-discoverable defects, its validity is questionable. In my opinion, the clause is extremely unfair because it prevents the buyer from exercising his rights as to a lack of conformity that is latent for more than thirty days.[174]

Under German law such a clause would be invalid, but German law was not applicable to the contract.[175] Italian law should have been applied to determine the clause's validity.[176] Since the LG Baden-Baden did not even discuss this problem, the outcome under Italian law is uncertain.[177]

Furthermore, the notice must specify the nature of the non-conformity under Article 39(1). The LG München I decided that the specificity requirement was not met when a buyer of shoes complained generally about bad fit and workmanship [LG München 3 July 1989].[178] I do not agree with the court. Generally, the requirement of specificity should not be exaggerated. Consider that it was the seller who delivered non-conforming goods; the buyer ought not have to bear the risk of non-conforming goods through unrealistic notice specificity requirements [BGH 2 June 1982 (a ULIS decision)].[179] A more general complaint, considered in context, should be sufficient.

Article 39 does not require that the notice of non-conforming goods be transmitted by a certain means of communication. While the notice can be made by telephone, the buyer has to prove that the telephone call was made and its content. Even worse, German courts will not even consider evidence of a telephone call if the buyer cannot exactly specify the date of the call and the other party to the conversation [LG Stuttgart 31 August 1989; LG Frankfurt 13 July 1994].[180] The reason for this is that German procedural law does not allow a party to prove a point with Ausforschungsbeweis (purely exploratory offers of unspecified facts). However, I do not agree with this procedural law; the buyer who does not know the exact date of the telephone conversation should be able to furnish supporting evidence of both its occurrence and content. If the offered evidence is not convincing, the judge will disregard it.

If the buyer fails to provide notice, he loses the right to rely on the lack of conformity.[181] Foregone remedies for such reliance include, for example, substitute delivery,[182] repair,[183] or price reduction. The same rule applies where the buyer fails to provide notice of delivery of a lesser quantity of goods than required by the contract, at least in cases of a hidden shortage (verdeckte Minderlieferung);[184] the buyer loses his right to demand delivery of undelivered goods, and he has to pay the full price.[185] It is doubtful, however, that the same rule applies when the delivery documents accurately reflect the delivery of less than the contracted quantity (offene Minderlieferung) [OLG Düsseldorf 8 January 1993].[186] In this case, the seller probably knows or, at least, ought to know of the shortage, and therefore notice is not required.[187]

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FOOTNOTES

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158. Furthermore, German courts have considered the buyer's notice of non-conforming goods under ULIS Articles 38-40. Since ULIS and CISG concepts are very similar in this context, these decisions will be influential on CISG interpretation. Most of the decisions are published in Peter Schlechtriem & Ulrich Magnus, Internationale Rechtsprechung zu EKG und EAG 231-300 (1987).

159. See Handelsgesetzbuch [HGB] §§ 377-78.

160. Judgment of Feb. 10, 1994, OLG Düsseldorf, 1994 RIW at 1051.

161. Judgment of Jan. 8, 1993, OLG Düsseldorf, 1993 RIW at 325.

162. Id.

163. Judgment of Aug. 31, 1989, LG Stuttgart, 1990 IPRax at 317.

164. Judgment of Feb. 10, 1994, OLG Düsseldorf, 1995 RIW at 55.

165. But see Ingeborg Schwenzer, Art. 39: Mängelrüge, in Kommentar zum Einheitlichen UN-Kaufrecht 357, 361-62 (Ernst von Caemmerer & Peter Schlechtriem eds., 2d ed. 1995).

166. Judgment of Apr. 3, 1990, LG Aachen, 1990 RIW at 492.

167. Judgment af Aug. 31, 1989, LG Stuttgart, 1990 IPRax at 317.

168. Judgment of Feb. 10, 1994, OLG Düsseldorf, 199S RIW at 55.

169. Judgment of Jan. 8, 1993, OLG Düsseldorf, 1993 RIW at 325.

170. Judgment of Feb. 22, 1994, OLG Köln, 1994 RIW at 973.

171. Judgment of Jan. 8, 1993, OLG Düsseldorf, 1993 RIW at 325; Ulrich Magnus, Zum räumlich-internationalen Anwendungs bereich des UN-Kaufrechts und zur Mängelrüge, 1993 IPRax 390, 391-92 (1993).

172. Judgment of Aug. 14, 1991, LG Baden-Baden, 1992 RIW 62.

173. See supra part IV.5.

174. See Karollus, Rechtsprechung (II), supra note 58, at 169.

175. See Gesetz zur Regelung des Rechts der Allgemeinen Geschäftsbedingungen [AGBG] § 9.

176. See EGBGB art. 28.

177. Even if the clause would have been valid under Italian law, the German judge could still have held the clause invalid under the doctrine of ordre public (public policy).

178. Judgment of July 3, 1989, LG München I, 1990 IPRax 316.

179. Judgment of June 2, 1982, BGH, 1982 NJW 2730, 2731 (considering notice specificity requirements under ULIS).

180. Judgment of Aug. 31, 1989, LG Stuttgart, 1990 IPRax at 317; Judgment of July 13, 1994, LG Frankfurt am Main, 1994 NJW-RR at 1265.

181. CISG, supra note 4, art. 39(1). But see id. art. 40, 44.

182. Id. art. 46(2).

183. Id. art. 46(3).

184. A "hidden shortage" arises when the quantity of goods actually delivered is less than the contract amount, but the invoice or delivery documents incorrectly report delivery of the full amount. See Judgment of Jan. 8, 1993, OLG Düsseldorf, 1993 RIW at 325.

185. Id. See Herber & Czerwenka, supra note 16, at 186-87; Schwenzer supra note 165, 365-66; Ulrich Huber, Art. 51: Teilweise Nichterfüllung, in Kommentar zum Einheitlichen UN-Kaufrecht 507, 510 (Ernst von Caemmerer & Peter Schlechtriem eds., 1st ed. 1990). Contra Herbert Stumpf, Art. 39: Mängelrüge, in Kommentar zum Einheitlichen UN-Kaufrecht 335, 338 (Ernst von Caemmerer & Peter Schlechtriem eds., 2d ed. 1995) (stating that the buyer only has to pay for the quantity actually delivered).

186. The OLG Düsseldorf expressly stated that it did not want to treat this issue. Judgment of Jan. 8, 1993, OLG Düsseldorf, 1993 RIW at 325.

187. CISG, supra note 4, art. 40.

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