Source: http://cisgw3.law.pace.edu/cases/980318f1.html
Timestamp: 2019-04-22 18:21:34+00:00

Document:
The buyer, a French company, ordered a supply of first-grade and second-grade winter clothing from the seller, a German company.
On observing that the delivery included summer garments and accessories that had not been ordered and also certain damaged goods, the buyer sued the seller before the Commercial Court of Montereau, basing its case on articles 31, 50 and 51 CISG and seeking damages to compensate for the commercial and financial loss that it had sustained. The Court declined jurisdiction in favour of the Courts of Munich.
The plaintiff raised an objection, invoking article 5(1) of the Brussels Convention and maintaining that the due place of delivery of the goods was in France. The defendant referred to article 35 CISG, in accordance with which the obligations regarding delivery and conformity of the goods had to be performed in the same place. In accordance with the intention of the parties, which had made their contract subject to the Incoterm "ex works" (EXW) and with the provisions of article 31 CISG, that place should be the defendant's principal place of business in Germany.
The Court of Appeal rejected the objection. In order to implement article 5(1) of the Brussels Convention, it applied the Vienna Convention, noting that the obligation regarding conformity could not be deemed to be independent of the obligation to delivery under article 31(a) CISG, the conformity obligation at issue had to be performed in Germany.
"Most national courts interpret the place of delivery under Article 31 as the place of performance of delivery for purposes of determining jurisdiction where the CISG governs the place of delivery.  In a 1998 case, the French Court of Appeals in Paris  addressed a situation in which the buyer, a French company, ordered winter clothing from a German seller. The goods were subject to a contract specifying the INCOTERM "ex works," which the French court determined to be the defendant's principal place of business in Germany. It declined jurisdiction in favor of the courts of Germany. Where the parties have not specified a place for delivery, French courts have, consistent with Article 31(a), identified the place of delivery to be the place where the goods were handed over to the first carrier for transmission to the buyer. In these cases, the French courts [page 387] have observed that the place of performance of the obligation to deliver goods and the place of performance of the obligation to deliver conforming goods must be the same. "
535. Societe Anton Huber GmbH & Co. KG v. SA Polyspace, E 99-14.844, Cour de cassation, Jun. 21, 2001 (Fr.), available at <http://cisgw3.law.pace.edu/cases/010626f1.html> (The European Community Convention on Jurisdiction and the Enforcement of Judgments in Civil and Commercial Matters [Brussels Convention 1968] identified the place of delivery as the place of performance for purposes of determining jurisdiction.); see Michael Joachim Bonell & Fabio Liguori, The U.N. Convention on the International Sale of Goods: A Critical Analysis of Current International Case Law -- 1997 (Part 1), 2 Uniform L. Rev., 385, 385-95 (1997) (discussing jurisdiction cases based on identifying the place of performance of delivery under art. 31) [available at <http://cisgw3.law.pace.edu/cisg/biblio/libo1.html>].
537. Societe Laborall v. S.A. Matis, 97/24418 CA Paris, Mar. 4, 1998 (Fr.), available at <http://cisgw3.law.pace.edu/cases/980304f1.html> [English translation by Charles Sant 'Elia]. In the same month, this court ruled similarly on a contract where goods sold by an Italian manufacturer to a French buyer subject to a contract specifying delivery "ex works." See Societe TCE Diffusion S.a.r.l. v. Societe Elettrotecnica Ricci, 514 CA d'Orleans, Mar. 29, 2001 (Fr.), available at <http://cisgw3.law.pace.edu/cases/010329f1.html> [English translation by Yvonne P. Salmon] (declining jurisdiction in favor of Milan, Italy, the place of delivery under CISG art. 3).
538. Societe Mode jeune diffusion v. Societe Maglificio il Falco di Tiziana Goti e Fabio Goti et al, 95-20.809 Court of cassation, Dec. 2, 1997 (Fr.), available at <http://cisgw3.law.pace.edu/cases/971202f1.html> [English translation by Charles Sant 'Elia]; CA Paris, 95-018179, Dec. 13, 1995, supra note 260.
539. Where the obligation in question is the obligation to pay, CISG, supra note 4, at art. 57, may be used to identify the place of the obligation to pay, and jurisdiction over disputes based on the obligation to pay may be resolved with reference to Article 57. See, e.g., CA 93/2821 Mar. 29, 1995, supra note 160.
PARTIES: COUNSEL. Plaintiff [appellant]: Société Franco-Africaine de Distribution Textile (SFADT) of 72, rue Saint Merry - 77300 Fontainebleau, represented by Maître Laurence Bedossa, E 351. Defendant [appellee/respondent]: More and More Textilefabrik GmbH of Emslander Strasse 3, 82319 Starnberg (Germany); represented by Maître Laurent Martinet, attorney (Selarl Thomas & Associés) L 118.
COMPOSITION OF COURT: HEARING: RULING. During the arguments and the deliberation: président: Mrs. Cahen-Fouque; conseillers: Msrs. Linden , Lachacinscki; greffier during the arguments and entry of the ruling: F. Liegey. Arguments at the public hearing on 18 February 1998: Ruling publicly announced by Mrs. Cahen-Fouque, président, signed the transcript of ruling with F. Liegey, greffier.
[Buyer], of Fontainebleau, France, placed an order for first and second quality winter clothing on 22 October 1996 with [seller], a company formed under German law and officed in Starnberg.
The delivery occurred on 9 December 1996 and, according to the statements of [buyer], it was then noticed that the goods included besides summer clothes and accessories which were not ordered, also other goods bearing holes, tears and containing grave defects making them totally unfit for sale.
It is in these circumstances that [buyer] summoned [seller] before the Tribunal de commerce [Court of First Instance] of Montereau, France, by invoking the lack of conformity of the delivered goods and basing itself on the provisions of Articles 31, 50 and 51 of the Vienna Convention of 11 April 1980 [CISG], to have the Court order [seller] to pay to [buyer] the exchange value in French francs of 60,000 DM [Deutsche Mark] for [buyer's] commercial and financial damages.
By judgment of 4 November 1997, the Court of First Instance, acceding to the objection of lack of jurisdiction raised by [seller], and ruling in favor of the jurisdiction of the courts of Munich, declined its own competence.
[Buyer] sought reversal, maintaining that the conforming place of the obligation of delivery of the goods sold, which, according to Article 5(1) of the Brussels Convention of 27 September 1968, must be considered to determine the competent jurisdiction, is found in its premises, which are on French territory.
In response to the arguments of [seller], [buyer] later maintained that the reference to the Incoterm "EXW", which concerns only the modes of transport of the goods, is without reach in the present dispute, and that putting the goods at the disposal of the carrier, which had moreover formulated some reservations at the time of the loading, in the warehouses of [seller], is not sufficient to establish that [seller] had thus performed its obligation of conforming delivery, which can be assessed only in the warehouses of [buyer] at Chatou, France, so that [buyer] seeks additionally to have the Appellate Court rule that the Commercial Court of Versailles, indeed, has jurisdiction; [buyer] seeks a sum of 30,000 f [French francs] pursuant to Article 700 of the new French Code of Civil Procedure.
[Seller] seeks denial of reversal; [seller] maintains that according to the provisions of Article 35 of the CISG, the obligations of delivery and conformity of the goods to their purpose must be executed in the same place, and that it results as much from the will of the parties to subject their contract to the Incoterm "EXW", as from the provisions of Article 31 of the CISG, that this place is situated in its premises in Starnberg, Germany, which is within the sphere of the Munich courts, so that by virtue of Article 5(1) of the Brussels Convention, these courts alone are competent; [seller] seeks a sum of 40,000 f pursuant to Article 700 of the new Code of Civil Procedure.
[Seller], the defendant, being domiciled in Germany, jurisdiction must be determined with regard to the provisions of the Brussels Convention of 27 September 1968 [Convention on Jurisdiction and Enforcement of Judgments in Civil and Commercial Matters].
According to Article 5(1) of the Brussels Convention, the defendant can, in contractual matters, be brought, in another Contracting State, before the court of the place where the obligation which serves as basis for the demand was or must be executed. This place is determined according to the law which governs the disputed obligation according to the conflict rules of the seized jurisdiction; that is the Vienna Convention of 11 April 1980 [CISG] on the International Sale of Goods.
France and Germany being parties to this Convention at the date of the contract concluded between [buyer] and [seller], which have their respective offices in these two States, the provisions of this Convention are applicable to this contract by virtue of Article 1(1)(a) of that text.
In the case at bar, the disputed obligation is an obligation of conformity. Pursuant to Articles 35(1) and 35(2)(a) of the CISG, the seller must deliver goods which are of the quantity, quality and type required by the contract, and which are contained or packaged in the manner required by the contract; except where the parties have agreed otherwise, the goods do not conform with the contract unless they are fit for the purposes for which goods of the same description would ordinarily be used.
It results from these provisions that the obligation of conformity of the goods to their purpose is not independent from the obligation of delivery, so that the corresponding obligations are executed or must be executed in the same place.
In the case at bar, it emerges from the elements of the file and it is not disputed, that the sale was subject to the Incoterm "EXW at the factory"; indeed, [buyer's] order of 22 October 1996 contains the language: "Transports: EX-factories" (that is "EXW at the factory"), [seller's] letter of 22 November 1996 indicates: "Pick up by factory"; to the same effect is the invoice issued by the seller and the documentary credit issued by the Crédit Commercial de France which mentions: "EXW Starnberg".
Besides, it is an established fact that the goods were handed over to a carrier at the premises of [seller], so that in any case, by virtue of the provisions of Article 31 of the CISG, the disputed obligation of conformity had to be executed at Sternberg, Germany.
The aforementioned obligation having also to be performed in Germany, the provisions of Article 5(1) of the Brussels Convention, which envisions the competence of a jurisdiction of a Contracting State different from that of the place of residence of the defendant, are not applicable in the case at bar. The lack of jurisdiction can be determined as a consequence only with regard to Article 2 of the Brussels Convention. It follows that the dispute returns to the competence of the courts of Munich, in the jurisdiction of which [seller] has its office.
Thus it is proper that the Commercial Court of Montereau declined its competence. [Buyer's] petition for reversal of this ruling will as a consequence be denied. [Buyer] will have to pay a sum of 8,000 f to [seller] in conformity with the Article 700 of the new Code of Civil Procedure.
Holds that [buyer] shall bear the costs of these proceedings.
* All translations should be verified by cross-checking against the original text. For purposes of this translation, the plaintiff-appellant Société Franco-Africaine de distribution textile of France is referred to as [buyer]; the defendant-appellee More and More Textilfabrik GmbH of Germany as [seller].

References: v. 
 art. 31
 v. 
 v. 
 art. 3
 v. 
 art. 57