Source: http://cisgw3.law.pace.edu/cases/020426g1.html
Timestamp: 2019-04-25 07:55:14+00:00

Document:
In accordance with the contract of 7 September 1997, Plaintiff [Seller] delivered to Defendant [Buyer] 5,126 metal racks produced by it at a price of Deutsche Mark [DM] 7.07 each. Delivery was in four parts. After each delivery, [Seller] settled up accounts with [Buyer]. The amount of the fourth delivery was the subject of a court action by [Seller] at the Local Court (Amtsgericht) of Göttingen which, by judgment of 11 April 2000. Concerning the first three deliveries of 29 September, 2 October and 27 October an amount of DM 18,693.80 remains outstanding with regard to a down payment of DM 10,000. In respect of the payment of that outstanding amount - incorrectly calculated as DM 18,720.80 - [Seller] first referred to the Local Court of Göttingen, which then transferred the case to the District Court (Landgericht) of Göttingen.
The service of process as well as the order of written preliminary proceedings ordered by the District Court to the address "37085 Göttingen" was delivered to "79361 Sasbach" after the change of address of residence was undertaken by the German Postal Service. Service by deposit took place there on 10 May 2001.
After the German Postal Service had returned the service by deposit to the District Court of Göttingen with the note "Addressee moved away. No consent to passing on of the new address given", the District Court considered the service of process to be invalid. Therefore, the case was informally transferred to the District Court of Freiburg "for reasons of jurisdiction" on 15 August 2001.
Instead of rejecting the doubtful transferral, the deputy presiding judge at the District Court of Freiburg ordered the service of the claim including further memoranda of [Seller] to the address "79361 Sasbach" on 22 August 2001 which was undertaken by deposit on 24 August 2001. After [Buyer] had not indicated its response, a judgment by default in accordance with the procedure under para. 331(3) of the German Code of Civil Procedure was rendered, ordering [Buyer] to pay DM 18,720.80 plus [2.6] % interest since 18 December 1998. This judgment was served on the parties on 12 September 2001, to [Buyer] again at the given address by deposit.
By telefax 26 September 2001, [Buyer]'s attorneys at this time on lodged an objection to the judgment of default and announced on 28 September 2001 that [Buyer] had its residence in "F-68160 Ste-Marie-aux-Mines" since April 2001.
After doubts had arisen whether the claim and the further documents served on 24 August 2001 fulfilled the requirements of para. 253 German Code of Civil Procedure, [Seller]'s attorney filed a new claim on 7 November 2001 which was served upon [Buyer]'s attorneys on 30 November 2001. According to the new claim, [Seller] demands that [Buyer] be ordered to pay DM 18,720.80 plus [2.6] % interest since 18 December 1998. [Buyer] pleads that the claim should be refused as inadmissable. It challenges the jurisdiction of the District Court of Freiburg. In the alternative, [Buyer] asserts limitation of actions of the claim.
1. The judgment by default is to be set aside as it has not been rendered in accordance with the law. The services of 24 August 2001 and 12 September 2001 are invalid because [Buyer] did not have its residence at the address at the time of service, although it maintained a business establishment under the business name "A GmbH" of which the sole managing director and shareholder is W. and has registered a business. The legal requirements for a judgment by default were therefore not given. Furthermore, it did not validly come into existence under para. 310 (3) German Code of Civil Procedure due to lack of service. The invalid judgment of default must consequently be set aside.
2. The [Seller]'s claim is to be refused because the District Court of Freiburg lacks jurisdiction. In order to determine the international jurisdiction, the Lugano Convention on Jurisdiction and Enforcement of Judgments in Civil and Commercial Matters from 16 September 1988 - Lugano Convention - is to be applied. According to Art. 2(2) of the Convention, persons who have their residence within the territory of a Contracting State are to be sued at the courts of that State regardless of their citizenship. The jurisdiction of a German court cannot be deduced from title II of the Lugano Convention, it is especially not established by Art. 3(1) in connection with Art. 15 No. 1. The contractual relations between the parties are to be considered according to the CISG of which Arts. 1(1) and 3 are applicable. Under Art. 4 CISG with Art. 57(1)(a) CISG, the place of payment is at the place of business of the seller. Due to the lack of a contractual agreement, Art. 57(1)(b) CISG is not applicable because payment only had to take place by account fourteen days after delivery of the goods, so that the place of performance of the payment is in Poland. [Buyer] challenged the jurisdiction and did not comply to the proceedings, so that the District Court of Freiburg has to declare itself to be incompetent under Art. 20 of the Lugano Convention and the claim has to be refused as inadmissible.
* All translations should be verified by cross-checking against the original text. For purposes of this translation, the Plaintiff is referred to as [Seller] and the Defendant is referred to as [Buyer]. Amounts in German currency (Deutsche Mark) are indicated as [DM].

References: Art. 2
 Art. 3
 Art. 15
 Art. 4
 Art. 57
 Art. 57
 Art. 20