国际商法CHAPTER-10

CHAPTER10SALES*2021/3/11CHAPTER10SALESTopicsforthischapter:UNConventiononContractsfortheInternationalSaleofGoods(CISG)TransactionsCoveredinCISGContractualIssuesExcludedfromCoverageofCISGInterpretingCISGInterpretingSalesContractsFormationoftheContractGeneralStandardsforPerformanceSeller’sObligationsThePassingofRiskRemediesExcusesforNonperformance*2021/3/11UNConventiononContractsfortheInternationalSaleofGoodsTheCISG,adoptedin1980,incorporatesrulesfromallthemajorlegalsystems.Itprovidesacceptedsubstantiverulesonwhichcontractingparties,courts,andarbitratorsmayrely.Ithasbeenratifiedby72countries,buthasnotbeenratifiedbyBrazil,Japan,India,andtheUK.Japanisexpectedtoratifyitin2008.TransactionsCoveredinCISGCISGappliestocontractsforinternationalsaleofgoods.Thebuyerandsellermusthavetheirplaceofbusinessindifferentstates.Either:Bothofthestatesmustbecontractingpartiestotheconvention,orTherulesofprivateinternationallawmustleadtotheapplicationofthelawofacontractingstate.AratifyingstatemaydeclarethatitwillapplyCISGonlywhenthebuyerandsellerarebothfromcontractingstates.OptingInandOutPartiestoacontractmayexcludeormodifyCISG’sapplicationbyachoice-of-lawclause.Achoice-of-lawclauseisacontractualprovisionthatidentifiesthelawtobeappliedintheeventofadisputeoverthetermsortheperformanceofthecontract.Case10-1:AsanteTechnologies,Inc.v.PMC-Sierra,Inc.Issue:DoestheU.S.federalcourthavejurisdictionanddoesCISGapplytothiscontract?ThecourtdeterminedthepartieswerefromdifferentstatesandCISGappliestocontractsbetweensuchparties.ThepartiesdidnotoptoutoftheCISGanditwasthecontrollinglaw.SalesDefinedAsaleistheexchangeofgoodsforanamountofmoneyoritsequivalent.TheCISGdoesnotdefinesales,butvarioussectionspresentthesamedefinitionasmanydomesticlaws,suchastheU.S.UCC,whichdefinesasaleasthe“passingoftitlefromthesellertothebuyerforaprice.”ThegoodsprocessedthroughthePortofVancouver,B.C.arelikelybeingshippedundercontractscontrolledbytheCISG.Photo:Publicdomainhttp://commons.wikimedia.org/wiki/Image:PortOVan.jpgGoodsDefinedAgoodisamoveable,tangibleobject.ForthepurposesoftheCISG,goodsdonotincludethingsboughtforpersonaluseoratanauctionorforeclosuresale,normaytheybeocean-goingvesselsoraircrafts.ThesecandlesmayormaynotbeagoodunderCISGdependinguponwhethertheyaresoldtoindividualconsumersorsoldinbulktoaretailerforresale.Photo:Usedwithpermissionoftheauthorfrompersonalarchive.MixedSalesSellerofgoodsoftenfurnishesserviceswhendeliveringaproduct.CISGlooksuponmixedsalesandservicecontractsassalesofgoods,unlessthepreponderantpartoftheobligation”oftheseller“consistsinthesupplyoflabororotherservices.”ContractualIssuesExcludedFromtheCoverageofCISGCISGonlydealswith:Theformationofthecontract,andTheremediesavailabletothebuyerandseller.CISGexcludesquestionsabout:thelegalityofthecontract,thecompetencyoftheparties,therightsofthirdparties,andliabilityfordeathorpersonalinjury.PreemptionIfCISGappliestoaparticularcontractualissue,domesticlawispreempted.RemediesprovidedinCISGaretheonlyremediesavailable.Preemptionhelpstofulfillthegoaloftheconventiontoestablishuniformrulesforinternationalsalescontracts.TheonlypermissibleremedyforadefectivesawistheoneprovidedbyCISGwhenthereisaninternationalsale.Photo:publicdomainSource:http://www.osha.gov/SLTC/etools/woodworking/radial.htmlInterpretingCISGTointerpretCISG,acourtistoconsider:theinternationalcharacteroftheconvention,theneedtopromoteuniformityintheconvention’sapplication,andtheobservanceofgoodfaith.TheCISGimpliesthatacourtmayonlyusetheplainmeaningofthelanguageoftheconvention.Courtsmayalsolookthetravauxpreparatoriesorlegislativehistorytodetermineintent.InterpretingCISG:GeneralPrinciplesCISGcallsforcourtstolooktothegeneralprinciplesonwhichtheconventionisbasedwheninterpretingitsprovisions.Twoofthesuggestedprinciplesare:Apartytoacontracthasthedutytocommunicateinformationneededbytheotherparty,andPartieshavetheobligationtomitigatedamagesresultingfromabreach.InterpretingSalesContractsAcontractissaidtobeformedonlywhenthepartieshaveameetingoftheminds.Thissubjectiveintentapproachsaysthatcontractsshouldbeinterpretedaccordingtotheactualintentandunderstandingofthepartiesatthetimetheymadetheiragreement.CISGsayscourtsaretousesubjectiveintentonlyiftheotherpartykneworcouldnothavebeenunawareofthespeaker’sintent.Ifintentisunclear,courtsuseobjectiveintent.NegotiationsWhenacourtistodetermineintent,CISGdirectsthatdueconsiderationbegiventoallrelevantcircumstances,including:thenegotiationsleadinguptothecontract,thepracticesthatthepartieshaveestablishedbetweenthemselves,andtheparties’conductaftertheyagreetothecontract.CISGdoesnotapplythetechnicalrulesthatdomesticcourtsusetointerpretcontracts,suchastheparoleevidencerule.PracticesandUsagesPartiesareboundbyanypracticeswhichtheyhaveestablishedbetweenthemselves.Acourtisallowedtoconsideranyusagesthatthepartiesagreedto.Ausageisthecustomarymethodofperformingoractingthatisfollowedbyaparticulargroupofpeople,suchaspeoplewithinaparticulartrade.CISGletsacourtconsider“ausageofwhichthepartieskneworoughttohaveknownwhichininternationaltradeiswidelyknownto,andregularlyobservedbypartiestocontractsofthetypeinvolvedintheparticulartradeconcerned.”Case10-2:TreibacherIndustrie,A.G.v.AlleghenyTechnologies,Inc.DefendantTDYenteredintoconsignmentcontractswithTreibacher,thenrefusedshipmentwhenitfoundacheapersupplier.Courthadtointerpret,undertheCISG,thewordconsignment.Issueturnedonwhetherthatwordshouldbeinterpretedaccordingtoitsmeaningbasedonthe“courseofdealings”or“customaryusageintrade.”Courtappliedcourseofdealingsandawarded$5,327,042.FormTheCISGstatesthatacontractforsaleneednotbeconcludedinorevidencedbywritingandisnotsubjecttoanyotherrequirementsastoform.Itmaybeprovedbyanymeans,includingwitnesses.However,CISGauthorizesacontractingstatewhoselegislationrequirescontractsofsaletobeconcludedinorevidencedbywritingtomakeadeclarationatthetimeofratificationtheCISGprovisiondoesnotapplywhereanypartyhashisorherplaceofbusinessinthatstate.FormationoftheContract:TheOfferAcontractisformedwhenanoffertobuyorsellagoodisaccepted.Anofferisaproposalbyonepersontoanotherindicatinganintentiontoenterintoacontractunderspecificterms.Tobeavalidoffer,theofferormustcommunicateanintentiontobebound.Aproposalissufficientlydefiniteifitindicatesthegoodsandexpresslyorimplicitlyfixesormakesprovisionfordeterminingthequantityandprice.EffectivenessofanOfferAnofferbecomeseffectiveonlyafteritreachestheofferee,aspecificpersonaddressedintheoffer.Offerscanbewithdrawnbeforetheyreachtheofferee.Offerscanberevokedanytimebeforetheoffereedispatchesanacceptance.Afirmofferisanofferthattheofferorpromisestokeepopenforafixedperiodoftime.AcceptanceAcontractcomesintoexistenceatthetimetheofferisaccepted.Anacceptanceisastatementofconductbytheoffereeindicatingassentthatiscommunicatedtotheofferor.Silencedoesnotconstituteacceptance.Acceptancemustbereceivedwithinthetimeperiodspecifiedintheoffer.Ifnotimeperiodisgiven,acceptancemustbereceivedwithinareasonabletime.Acceptanceiseffectivewhenreceivedbyofferor.Case10-3:UnitedTechnologiesInternational,Inc.v.MagyarLegiKozlekedesiVallalatPlaintiffofferedtosellaircraftenginestodefendantatspecifiedpricesinaquantitytobeselectedbythedefendantdependinguponhowmanyplanestheypurchased.Defendantssentacceptance.Termrequiringgovernmentapprovalwasnotaconditionprecedent.Anenforceablecontractwasformed.AssentbyPerformanceofanAct,Withdrawal,andRejectionIftheofferorasksforperformanceofanactratherthantheindicationofacceptance,theacceptanceiseffectivewhentheactisperformed.Anoffereemaywithdrawhis/heracceptanceanytimebeforeorsimultaneouswithitsreceipt.Arejectionbecomeseffectivewhenitreachestheofferor.Iftheoffereesendsbothanacceptanceandarejection,theonethatreachedtheofferorfirstwouldbegiveneffect.AcceptanceWithModificationsIftheacceptancemodifiessomeofthetermsoftheoffer,thereisacounterofferinsteadofanacceptanceiftheseinconsistenciesare“material.”UndertheCISG,additionaltermsordifferenttermsrelating,amongotherthings,totheprice,payment,qualityofthegoods,place,andtimeofdelivery,extentofoneparty’sliabilitytotheother,orthesettlementofdisputesareconsideredtoalterthetermsoftheoffermaterially.Case10-4:Filanto,SPAv.ChilewichInternationalCorp.ChilewichwassupplyingbootstoaRussiancompanythatwerebeingmadebyFilanto.ChilewichmadereferencetoanarbitrationclauseintheRussianContractwithChilewich.FilantofailedtoobjecttotheincorporationbyreferenceoftheRussianContractinatimelyfashion.Thearbitrationclausebecomepartofthecontract,requiringarbitrationinMoscow.FundamentalBreachWhenonepartybreaches,theotherpartymayavoidthecontractormakeademandforspecificperformance.Abreachofcontractcommittedbyoneofthepartiesisfundamentalifitresultsinsuchdetrimenttotheotherpartyassubstantiallytodeprivehimorherofwhatheorsheisentitledtoexpectunderthecontract.Theinjuredpartymayusetheremedyofavoidancebynotifyingtheotherpartyandreturninganygoodsalreadyreceived.InvoiceusedinTaiwanPhoto:CC-BYhttp://commons.wikimedia.org/wiki/Image:Invoice_TW_front.JPGRequestsforSpecificPerformanceAninjuredpartymaybeabletorequestspecificperformanceiftheotherpartyisinbreach.Specificperformanceisacourtorderdirectingapartytocarryouttheobligationsheorshehadcontractuallypromisedtodo.Insomecivillawcountries,apartyisentitledtorequireperformance.IntheUS,specificperformanceisgrantedifthegoodsareuniqueandcannotbeobtainedelsewhere.Seller’sObligationsAsellerisrequiredto:deliverthegoods,handoveranydocumentsrelatingtothem,ensurethatthegoodsconformtothecontract.Theplacefordeliveryistheplaceagreedtointhecontract.Otherwise,itis:thefirstcarrier’splaceofbusiness,ortheplacewherethepartiesknewthegoodswerelocatedorweretobemanufactured.TimeforDeliveryandTurningOverDocumentsSelleristodelivergoodsonthedatefixedinthecontract.Ifnofixeddate,withinareasonabletimeaftertheconclusionofthecontract.Attimeandplaceofdelivery,sellermustturnoveranydocumentsrelatingtothegoodsthatthecontractrequires.Ifdocumentsaredeliveredearly,sellerhastherighttocureanydefectinthedocuments.ConformityofGoodsSellermustdelivergoodswhichareofthequantity,quality,anddescriptionrequiredbythecontractandarepackagedinthemannerrequired.Goodsdonotconformunlessthey:arefitforthepurposeofwhichgoodsofthesamedescriptionwouldordinarilybeused;arefitforanyparticularpurposeexpresslyorimpliedlymadeknowntotheseller;possessthequalitiesofgoodswhichthesellerhasheldoutforthebuyerasasample;arepackagedinthesamemannerusualforsuchgoods.Third-PartyClaims,Waiver,TimeforExaminingGoods,andCuringDefectsGoodsarenonconformingiftheyaresubjecttothird-partyclaimssuchasownershipandrightsinintellectualproperty.Thepartiesmaywaivetheconformityrequirement.Buyhasanobligationtoexaminethegoodsfordefectswithinasshortaperiodasispracticableafterdelivery.Buyerisobligatedtoinformthesellerofanydiscovereddefectwithinareasonabletime.Ifasellerdeliversearly,heorshemaycureanydefectuptotheagreedupondatefordelivery.Buyer’sObligationsAbuyerisrequiredto(1)paythepriceand(2)takedeliveryofthegoods.Unlessadifferenttimeisspecified,thebuyermustpaywhenthegoodsorthedocumentscontrollingtheirdispositionaredelivered.Ifplaceofdeliveryisspecified,paymentisalsomadethere.Ifnoplaceofdeliveryisspecified,thenbuyermustpayattheseller’splaceofbusiness.Case10-5TheNaturalGasCaseTheplaintiff,aGermanycompany,negotiatedtobuynaturalgasfromanAustrianpartnership.ThedefendantwastoshipthepropanefromtheUStotheplaintiffinBelgium.Theplaintiffwastoobtainaletterofcreditoncethedefendanttolditwherethepropanewastobeloaded.Issue:Hadthedefendantbreachedthecontractbyfailingtodeliverthepropaneorwasitsdutytoperformexcusedbytheplaintiffnotobtainingaletterofcredit?Case10-5TheNaturalGasCaseHeld:Thebuyerwasexcusedfromopeningaletterofcreditbecausethedefendantneverprovidedthenecessaryinformationfortheletter.Thebreachwasduetotheseller’sfailuretomakeproperarrangementstoshipthegas.PassageofRiskThelegalconceptofpassageorriskisthepointintimewhenthebuyerbecomesresponsibleforlossestothegoods.Oncetheriskpasses,thebuyermustpayforthegoods.Eveniftheyaredamagedordestroyed.CISGallowsthepartiestoallocateriskandspecifywhenriskwillpass.Thepartiesusuallyshowpassageofriskthroughtheusageoftradeterms,suchasFreeonBoard(FOB)orCost,Insurance,andFreight(CIF).SinkingshipintheStraitofGibraltar.PhotoLic:CC-BYhttp://commons.wikimedia.org/wiki/Image:MV_New_Flame_salvage.jpgMeansofDeliveryGoodsmaybedeliveredbyacarrierorbytheseller.Inshipment,transshipment,in-transit,anddestinationcontracts,theriskoflosswillnotpassuntilthegoodsareclearlyidentifiedtothecontractbymarkingsonthegoods,shippingdocuments,ornoticegiventothebuyer.Inashipmentcontractwheretheselleristodeliverthegoodstoacarrieranddoesnotrequirethatthesellerdelivertoaparticularplace,theriskpasseswhenthegoodsarehandedovertothefirstcarrier.MeansofDeliveryIfthegoodsaretobedelivered“FreeAlongsideShip”(FAS)BigOcean,NewYorkCity,NY,thesellerbearstheriskuntilthegoodsaredeliveredtoNYalongsidetheBigOcean.Whenacontractrequiresthesellertoarrangetransportationtoaspecificdestination,theriskoflossdoesnotpasstothebuyeruntilthegoodsarehandedoverorplacedathis/herdisposalatthatplace.WhenasellerinChinaagreestoacontractcontaininga“DeliveredDutyPaid(DDP)LosAngeles,California,thesellerbearstheriskoftransportingthegoodstoLA.Buyer’sRemediesThebuyer’sremediesarecumulative,meaningtheyareabletobejoinedortakentogether.Theremediesuniquetothebuyerare:tocompelspecificperformance,toavoidthecontract,toreducetheprice,torefuseearlydelivery,andtorefuseexcessquantities.Buyer’sRemediesThebuyermayavoidacontractifeitherThesellercommitsafundamentalbreachorThebuyergivestheselleraNachfristnoticeandthesellerrejectsitordoesnotperformwithintheperioditspecifies.Abuyer’sNachfristnoticeisthefixingofanadditionalperiodoftimeofreasonablelengthforperformancebythesellerofhisorherobligations.DuringtheNachfristperiod,thesellerisentitledtocorrectorcurethenonconformityathisorherownexpense.Case10-6TheShoeSeller’sCasePlaintiff,anItalianbusiness,contractedtosellshoestothedefendant,aGermanbusinesswoman.Theshoesweredeliveredlateandthedefendantcontendedtheywerenonconforming.DefendantdidnotgiveaNachfristnoticeorattempttouseotherremediessuchaspricereduction.Courtfoundnofundamentalbreachbytheplaintiff.ReductioninPriceIfabuyerisnotentitledtodamageswhenasellerdeliversnonconforminggoods,thebuyerwillbeentitledtoareductioninprice.Thebuyermayreducethepriceinthesameproportionasthevaluethatthegoodsactuallydeliveredhadatthetimeofdeliverybearstothevaluethatconforminggoodswouldhavehadatthattime.Theformulais:Seller’sRemediesTheseller’sremediesmirrorthoseofthebuyer.Theseller’sremediesarebothcumulativeandimmediate.Theremediesuniquetothesellerare:Tocompelspecificperformance,Toavoidthecontractforafundamentalbreachorfailuretocureadefect,andToobtainmissingspecifications.RemediesAvailabletoBothBuyersandSellersRemediesavailabletobothare:Suspensionofperformance,Avoidanceinanticipationofafundamentalbreach,Aremedyavailabletoeitherpartywhenitbecomesclearthattheotherpartywillcommitafundamentalbreach.Avoidanceofaninstallmentcontract,andDamages.Abreachingpartyisliableonlyforthosedamagesthathe/sheforesaworoughttohaveforeseen.ExcusesforNonperformanceForcemajeure–apartyisnotliableforanydamagesresultingfromhis/herfailuretoperformifthepartycanshow:thefailurewasduetoanimpedimentbeyondhis/hercontrol,thattheimpedimentwasnotsomethinghe/shecouldhavereasonablytakenintoaccountatthetimeofcontracting,andthathe/sheremainsunabletoovercometheimpediment.Examples:disasters,war,strikesCase10-7:NuovaFucinati,SPAv.FondmetallInternational,ABPlaintiffwastodeliver1,000metrictonsofchromitetothedefendantinSweden.Thepriceofchromiterose43%beforedelivery.SinceSwedenhadnotratifiedtheCISG,itsexcusefornonperformancebasedonanimpedimentbeyondtheparty’scontroldidnotapply.Case10-7:NuovaFucinati,SPAv.FondmetallInternational,ABHeld:Thoughthedoctrineofcommercialimpracticabilityapplied,a43%riseinpricewasnotsufficienttoexcuseperformance.Allrightsreserved.Nopartofthispublicationmaybereproduced,storedinaretrievalsystem,ortransmitted,inanyformorbyanymeans,electronic,mechanical,photocopying,recording,orotherwise,withoutthepriorwrittenpermissionofthepublisher.PrintedintheUnitedStatesofAmerica.