Source: http://www.trans-lex.org/850000/
Timestamp: 2016-10-25 22:41:28
Document Index: 551131209

Matched Legal Cases: ['Art. 7', 'Art. 8', 'Art. 7', 'art.173', 'Arts 75', 'Art.7', 'Art. 79']

Trans-Lex.org Law Research - Docid: 850000 - Toggle navigation
Document-Id: 850000, Please cite as: "http://www.trans-lex.org/850000"TitleLamaud, Emmanuel, Comparison Between the CENTRAL List and the Vienna Convention for the International Sale of Goods - Specific Topics (research paper 2006)ContentEMMANUEL LAMAUD
The CISG is born from the failure of the Uniform Law for the International Sale of Goods (ULIS) and the Uniform Law on the Formation of Contract for the International Sale of Goods (ULFC), two Hague Conventions of 1964 drafted under the direction of the UNIDROIT and that received limited support (nine States ratified the conventions).2 The Vienna Convention was drafted under the direction of UNCITRAL (United Nations Commission on the International Trade Law). In charge of the task to ‘further the progressive harmonization and unification of the 7law of international trade’,3 the UNCITRAL requested the Secretary General to transmit to all Members of the U.N. the two Hague Conventions and to collect their opinions. Following the comments and suggestions, a Working Group was set up ‘in order to ascertain which modifications of the existing texts might render them capable of wider acceptance by countries of different legal, social and economic systems, or whether it will be necessary to elaborate a new text for the same purpose [...]’.4 During its nine sessions, the Working Group made a revision of the ULIS and ULFC with the proposition of two drafts respectively in 1976 and 1977. At the eleventh session of the UNCITRAL,5 both drafts were consolidated before being transmitted to the General Assembly of the United Nations which decided that an international conference of delegates should be convened to consider the Draft Convention. The United Nations Conference on Contracts for the International Sale of Goods was held in Vienna, from 10 March to 11 April 1980 and was attended by representatives of 62 States and of 8 international organisations. Two Committees were in charge to prepare, in one hand the text of the substantive provisions (Arts. 1-88) and, in the other, the final clauses (Arts. 89-101). The final texts of the Convention were then submitted to the Conference that voted in a Plenary session, article by article. Finally, ‘the Convention as a whole was submitted to a roll-call vote and was approved without dissent.’6 Actually, 67 States have signed the Vienna Convention.7
As indicates its name, the CISG is aimed to deal with a limited albeit important area of international trade: the international sale of goods. The purpose of the Convention is thus to provide substantive rules and to reach uniformity in its application and interpretation (Art. 7(1) CISG). However, the drafting process was characterized by several episodes of compromises between members of the Working Group or between delegates during the Vienna Conference. It results that the Convention 8contains provisions with open interpretations weakening the uniformity. Consequently, it is not uncommon that the Convention is supplemented by or interpreted in the light of other instruments of international trade law such as the UNIDROIT Principles for the International Commercial Contracts (UPICC) and the Principles of European Contract Law (PECL).8 As a result thereof, many comparative studies were made between the CISG and those instruments. The ‘new’ lex mercatoria, as an alternative source of the law of international trade might also be used to interpret the Convention. Indeed, Article 9(2) provides that trade usages are applicable to the contract or its formation unless explicitly excluded by the parties. It means that the Convention places transnational rules on the same level than party autonomy and thus, on a superior status than the Convention rules themselves.9
A comparative study between the Central list and the Vienna Convention would constitute a useful basis for the interpretation of the Convention in those cases where a uniform interpretation cannot be reached. For the purpose of this topic, the study shall be limited to some specific topics of commercial contracts that are important, in particular in regard to the difficulty of interpretation they represent for the CISG. Accordingly, this dissertation is to be divided into five parts. In the first part the TLDB Principle on good faith is compared with CISG counterpart article 7(1). In the second part, the TLDB Principle on fundamental non-performance is compared with article 25 CISG on fundamental breach of contract. In the third part, the TLDB principles dealing with Force majeure and Hardship are compared with article 79 CISG on Exemption. The fourth part is focused on the specific topic of price 10determination and the comparison between TLDB Principle IV.5 and Arts. 14(1) and 55 CISG. The fifth and final part deals with damages and the comparison between TLDB Principle VI.1 and article 74 CISG.
The principle of good faith has been retained in previous lists of Lex Mercatoria Principles. For instances, Michael Mustill21 proposed that the rule according to which ‘a contract should be performed in good faith’ forms part of the Lex Mercatoria. The same list was reproduced by Andreas Lowenfeld F.22 In the same vein, Fouchard, Gaillard and Goldman23 consider that the rule according to which ‘contracts must be performed in good faith’ is a principle of the lex mercatoria. Moreover, good faith in International Commercial Law is not merely a rule of the lex mercatoria; it is also considered as a general principle of that legal system. Accordingly it is said that good faith comes under the ‘essence of the Lex Mercatoria’.24 Some arbitral awards raise the duty of good faith to a general or fundamental principle of the lex mercatoria: in the ICC Award No 572125 good faith is referred as a ‘general notion’. In the ICC Award No 595326, it was considered that among the principles of the lex mercatoria, the most general one is the principle of good faith. It means that the Principle of good faith within the Lex Mercatoria helps the arbitrators to find out other rules. Indeed, Filali Osman held that in the absence of auxiliary rules of the parties’ will, International Commercial arbitrators progressively took from the fundamental principle of good faith the material allowing them to measure the behaviour of the parties and to pronounce more and more coherent and uniform rules.27
Within the TLDB List itself, the Principle of Good faith plays a determinant role. Indeed, the Principle forms part of the first chapter on the general provisions and it is the first Principle of the Central List. Thus, the concept of good faith is reflected in many other Principles of the List. For instance, Principle I.2 provides: ‘[t]he parties 12always have to act according to what is reasonable in view of the particular nature of their transaction and the circumstances involved, in particular the economic interests and expectations of the parties.’28 In the Chapter on contractual obligations, Principle IV.5.8 provides: ‘[e]ach party is under a good faith obligation to notify the other party of any problems that occur in the performance of the contract and to cooperate with the other party when such co-operation can reasonably be expected for the performance of that party's obligations.’29
a) English law
United States, as a common law country, used to have the same solution as in England. Nevertheless, American law has adopted the concept of good faith for decades, since the publication of the Uniform Commercial Code (UCC).40 UCC section 1-203 provides a general obligation of good faith: ‘every contract or duty within this Act imposes an obligation of good faith in its performance or 14 enforcement’. At least fifty other sections of the code mention good faith.41 Also, Section 205 of the Restatement provides that ‘every contract imposes upon each party a duty of good faith and fair dealing in its performance and enforcement’. Clearly, those two provisions limit the application of the principle of good faith to the performance of the contract.
The German Civil Code (BGB) came into force in 1900 and provides for the observance of ‘good faith and fair dealing’ (‘Treu und Glauben mit Rücksicht auf die Verkehrssite’). The principle transcends the whole code, from general provisions (articles 157 and 242 BGB) to more specific applications.44 Moreover, there is no definition of the concept. According to one commentator,45 it is an open norm rather than a legal rule with specific requirements. In the same vein and as enumerated by J. Felemegas46, the four functions of good faith in German law are: to create a general principle because it is an impossible task to draft a code dealing with all imaginable 15 situations; to carry the function of filling gaps or interpreting uncertain provisions within the code; to create obligations in order to complete the duties and obligations in the contract; to create a right of an adjustement of the contract after a change of circumstances.
Article 7(1) CISG provides: ‘[i]n the interpretation of this Convention, regard is to be had to its international character and the need to promote uniformity in its application and the observance of good faith in international trade’ [emphasis added]. This ‘peculiar provision’48 on good faith is the result of a compromise. Even though it does not expressly provide for a duty of good faith imposed on the parties, few are 16the decisions that limit the concept of good faith to the interpretation of the Convention.
The concept of good faith has been first introduced in 1977 in a proposal made by the Hungarian representative during the eighth session of the Working Group on charge of the revision of the uniform law on the formation of contract for the international sale of goods. Good faith was to be applied to the formation of contract and thus imposing a duty to the parties.54 Although the proposal was supported by the majority of the representatives since the principle of good faith was already embodied in many national laws, a strong opposition existed against the adoption of such a provision. Its opponents alleged, among others, that the wording was too vague and that it would have jeopardized a uniform interpretation.55 After deliberation, the sentence was adopted and became article 5 of the Draft Convention 17on the Formation of Contracts for the International Sales of Good. The provision was the subject of lengthy discussion during the eleventh session of the Commission in 1978. According to the Report,56 there was a wide support for the deletion of the article 5. Indeed, the opponents alleged that a Convention should not embody a ‘moral exhortation’, that national Courts would be too much influenced by their own legal system when applying good faith in individual cases, that the draft did not contain the consequences of a failure to observe the good faith leaving that matter to the national laws, with the result of not reaching uniformity of the sanctions. On the other hand, there was also a wide support for its retention. The representatives in favour of article 5 retorted that the principle of good faith was universally recognized, that good faith had played a very important role in developing rules regulating commercial activities, that good faith was well recognized in international law and that leaving to the national laws how to sanction a violation of good faith was preferable in order to afford flexibility.
Among the proposals to reach a compromise, the one which purported to embody the concept of good faith within the provision relating to the interpretation and application of the Convention received more support as a ‘realistic compromise’.57 When the draft Convention on the Formation of contract was merged with the draft Convention on the International Sale of goods, article 13 of that latter became article 6, which provided: ‘[i]n the interpretation and application of the provisions of this Convention, regard is to be had to its international character and to the need to promote uniformity and the observance of good faith in international trade’. The wording used does not make clear whether or not the observance of good faith was also directed to the parties to an international sales transaction. During the Vienna Conference, some amendments to article 6 of the 1978 Draft were made, the most important one being the introduction of a second paragraph dealing with the problem of gaps in the Convention. The debate on good faith was re-introduced by an amendment proposal of the Italian delegate to delete good faith from article 6 and to transfer it to article 7 [Art. 8 CISG]: ‘In the formation [interpretation] and performance of a contract of sale the parties shall observe the principles of good faith 18 and international co-operation’.58 A reference to international co-operation was added in order that only the aspects of good faith which are internationally acceptable would have to apply.59 In opposition to this proposal, the United Kingdom’s proposal, although admitting the interest for partie to act in good faith, considered that the principle had an uncertain meaning and its inclusion within the CISG would be inappropriate.60 E. Allan Farnsworth from the U.S. delegate also preferred the wording of the Draft.61 Finally, it was decided at the Plenary Conference to maintain the scope of application of the good faith principle within the limits of article 6 of the Draft which became article 7 CISG.
Unilex affords only one illustration64 of an interpretation strictly literal of article 7(1) CISG: confronted to a distributorship agreement, the Arbitral Tribunal had to settle a dispute between a German seller and a Spanish buyer. The buyer wanted to make use of the principle of good faith as interpreted by German Courts according to which the 19 producer of defected technical equipment has to provide spare parts. The Arbitral Tribunal held that good faith as mentioned in the Vienna Convention is ‘only’ applicable to the interpretation of the Convention and is not to be referred to as a source of the parties’ rights and duties as concerns the performance of the contract.
Indeed, the Vienna Convention deals with the rights and duties of the parties to a contract of sales of goods. Thus, the good faith principle contained in article 7(1) cannot be used for the interpretation of the Convention without any impact on the 20 parties to such a contract67: ‘interpreting the Convention in the light of good faith amounts to subjecting the rights and duties of the parties to that standard’.68 A French decision69 gives a good illustration of this proposal. In the case at hand, the Court of Appeal of Paris made use of the principle of good faith to evaluate the damages. In substance, it was held that, although the buyer was clearly in breach of its obligation (article 25 CISG), it started proceedings before the French Courts. Such a conduct was considered contrary to the principle of good faith laid down in article 7(1) CISG.
Alleging that article 7(1) CISG provides for the contracting parties to act in good faith leads to two major problems. First, in order to promote uniformity in the application of the Convention, national Courts should not be tempted to refer to the standard of their legal system. Indeed, the reference to good faith ‘in international trade’ purports to avoid such a result.70 M. J. Bonell gives some indications of what good faith in international trade could mean: It might mean such national standards to the extent they are ‘commonly accepted at a comparative level’.71 Also, the distinction generally found in domestic laws between consumer transaction and contracts of commercial nature might also be of some help.72 Finally, the reference to the Preamble of the Vienna Convention might provide a better indication.73 Second, if there is a general duty for the parties to conduct themselves in good faith, according to article 6 CISG, they would be able to exclude that duty. This result would impair part of the objective that article 7(1) tries to aim. In an Arbitral Award, it was held that by the intentional insertion of different terms in the letter of credit than what was agreed on, the buyers behaved in violation with the principle of good faith as provided by Art. 7(1) CISG; principle that cannot be limited or excluded by 21 the parties and that has to be understood in the way it is recognized in international trade.74
The Vienna Convention contains a gap filling provision (Article 7(2)) according to which ‘[q]uestions concerning matters governed by this Convention which are not expressly settled in it are to be settled in conformity with the general principles on which it is based (...)’. Moreover, not only the Convention expressly refers to good faith in its article 7(1) but it also contains so many provisions referring to reasonable conduct that it is said that good faith is one of its general principles.75 For instance, lot of articles refer to a ‘reasonable time’ (Arts. 25, 39(1), 43(1), 46(2) (3), 47(1) etc.). In the Secretariat’s Commentary on the Draft76 – closest counterpart to an official commentary – it is referred to some articles as a particular application of the principle of good faith: article 14(2)(b) [draft counterpart of CISG article 16(2)(b)] on the non-revocability of an offer where it was reasonable for the offeree to rely upon the offer being held open and the offeree acted in reliance on the offer; article 19(2) [draft counterpart of CISG article 21(2)] on the status of a late acceptance which was sent in such circumstances that if its transmission had been normal it would have reached the offeror in due time; article 27(2) [draft counterpart of CISG 29(2)] in relation to the preclusion of a party from relying on a provision in a contract that modification or abrogation [termination] of the contract must be in writing; articles 35 and 44 [draft counterpart of CISG articles 37 and 38] on the rights of a seller to remedy non-conformities in the goods; article 38 [draft counterpart of CISG article 40] which precludes the seller from relying on the fact that notice of non-conformity has not been given by the buyer in accordance with articles 36 and 37 [draft counterpart of CISG articles 38 and 39] if the lack of conformity relates to facts of which the seller knew or could not have been unaware and which he did not disclose to the buyer; articles 45(2), 60(2) and 67 [draft 22counterpart of CISG articles 49(2), 64(2) and 82] on the loss of the right to declare the contract avoided; articles 74 and 77 [draft counterpart of CISG articles 85 to 88] which impose on the parties obligations to take steps to preserve the goods.
Although article 7(2) CISG only refers to those principles on which the Convention is based, one author79 considers that, as an exception, recourse should be possible to general principles ‘which are internationally co-ordinated and [that] actually find general acceptance’. The advantage of such interpretation results in the possibility to 23 take into account new developments of the concept of good faith. Indeed, during the drafting of the Convention, there was much disagreement between common law and civil law countries on the approach to take for good faith. However, fundamental changes have happened in the law of some common law countries and as article 7(2) CISG stands, such development may not be taken into account. For instance, Australia is more prepared to recognize an obligation of good faith upon the parties.80 The same author makes the proposal to utilize the UNIDROIT Principles (in particular Principle 1.7(1)) as additional general principles of the CISG.
TLDB Principle VI.1 provides: ‘[i]f a party's failure to perform its obligation amounts to a fundamental non-performance, the other party may terminate the contract. Both parties may then claim restitution, in re or in money, of whatever they have supplied to the other party. The exceptio non adimpleti contractus rule applies’.81 The Vienna Convention counterpart article provides: ‘[a] breach of 24 contract committed by one of the parties is fundamental if it results in such detriment to the other party as substantially to deprive him of what he is entitled to expect under the contract, unless the party in breach did not foresee and a reasonable person of the same kind in the same circumstances would not have foreseen such a result’. In appearance, the Vienna Convention lays down a clearer rule than the TLDB Principle does. In reality both provisions are vague and recourse to the UNIDROIT Principles or the Principles of European Contract Law (PECL) might be useful. Firstly we shall deal with the Central List Principle and, secondly with the Vienna Convention provision.
Like Mustill’s list82, the Central List does not aim to give a definition of fundamental non-performance. It just mentions the Principle is part of that legal system. Indeed, Mustill considers that ‘[o]ne party is entitled to treat itself as discharged from its obligations if the other has committed a breach, but only if the breach is substantial’.83 He based himself on the ICC arbitral award 2583 of 197684 in which it was considered that, to abandon a contract, one or several serious (‘grave’) failure to the essential obligations of the contractor justify the avoidance of the project. Also, Fouchard, Gaillard, Goldman consider that ‘[t]ermination of the contract for failure, to perform or lack of proper performance, which is closely related to the withholding 25of performance, is also considered by some arbitrators to be a general principle of law’.85
Those few illustrations lead to the impossibility to determine a definition of fundamental non-performance. On the other hand, some arbital awards89 when applying the lex mercatoria apply or refer to the UNIDROIT Principles90 which contain provisions dealing with the right to terminate a contract in case of 26fundamental non-performance.91 Thus, their use might afford a better illustration of the principle of fundamental non-performance.
Article 7.3.1(2)(a) refers also to the substantiality of the non-performance and thus makes a tautology as well. The comments of Hossam El-Saghir on the PECL article 8:10393 might be used in order to explain that provision. The commentator considers that the provision is focus on the gravity of the consequence of the non-performance. The gravity must be determined in accordance with the intention or the expectation of the parties to the contract. It seems that such a result is in line with the solution 27 reached in the ICC Award No. 1795.94 The others paragraphs of the UNIDROIT article give complementary indications. Article 7.3.1(2)(b) provides that if strict performance of the contract is essential for one of the parties, a breach of that contract will be fundamental. It is not the gravity of the consequences of the non-performance but rather the strictness of the obligation that is the decisive factor.95 In the ICC Arbitral Award n° 476196 the breach by the defendant of its obligation to revise the price was determinant for the claimant which relied on that promise for its own performance. One can say that the border between strict compliance and gravity of consequences of the breach is not easy to determine in practice. In both cases, the aggrieved party loses interest in the performance of the contract justifying its cancellation. The Central List does not provide illustration of a fault as a relevant factor for the determination of a fundamental non-performance. Nevertheless, nothing in the TLDB Principle would prevent an Arbitral Tribunal to refer to the UNIDROIT Principle 7.3.1(2)(c). A similar outcome could be reached with respect to the (d) and (e) of the article.
28this reason, it was necessary to define the concept of fundamental breach.98 Having regard to the position of the concept within the Convention, it seems uneasy to analyse article 25 without a cross-reference to the other provisions mentioned above. However it is not the purpose of this topic. This part will be focused on the component elements of the definition. To the extent the definition incorporates vague words, the UNIDROIT Principles and the PECL might be useful tools for the interpretation of article 25 CISG.
According to the Secretariat Commentary101, the ‘substantial detriment’ is the ‘basic criterion’ of the definition which, thus, looks to the ‘harm’ caused to the aggrieved party. Nevertheless, the wording of the actual article 25 CISG is different from the Draft. Indeed, instead of ‘substantial detriment’, it contains: ‘detriment (...) as 29 substantially to deprive’. Accordingly, some commentators102 consider that the commentary should not apply to the interpretation of detriment. They believe that the meaning of the term should be tied to the expectation of the injured party i.e, whether or not it has still an interest in the performance of the contract. Thus, instead of having regard to the nature of the term detriment, it is on the degree or function that one should focus on. From Mª del Pilar Perales Viscasillas’ point of view, if the buyer can still resell non conforming goods, even at a lower price, or make use of those goods, it is not a fundamental breach of contract because the buyer found an interest in the performance of the contract. The difference in the profit can be remedied by the allowance of damages.103
Article 25 CISG is similar to article 7.3.1(2)(a) of UNIDROIT and article 8:103(b) of PECL. Among the ‘subtle’ differences106 that exist between them, under the Convention the detriment is a precondition whereas it is not under the UNIDROIT 30 Principles and PECL. Like articles 7.3.1(2)(b) of UNIDROIT and 8:103(a) of PECL, under article 25 CISG the terms of the contract vehicle the expectation of the parties.107 Thus, if it is expressly provided delivery or payment for the 15th of February for instance, the minor deviation might lead to the avoidance of contract. According again to Hossam El-Saghir108 and Robert Koch109, the Convention is not interested by the intentional or reckless non-performance. Fault is not a prerequisite for a breach to be fundamental.
Regarding the lack of conformity of the goods, a French decision113 considered that the seller committed a breach justifying avoidance of the contract, because the defects concerned a third of the total number of the goods and made their use dangerous. Indeed, those goods were to be distributed in a chain of supermarkets. In that case, it could be said that the security in the use of the goods was a relevant criterion. Without going so far, an American Court114 held that the lower cooling capacity of compressors to be used in a line of room air conditioners and their high energy consumption constituted a fundamental breach from the seller’s part because they are ‘important determinant of the productive value’ of the goods. It should also be pointed out that, in the circumstances of the case, the buyer relied on a sample. In a case dealing with non-payment of the price, an Australian Court considered that the failure to issue a letter of credit amounted to a fundamental breach because, in the particular circumstances of the case, it was demonstrated that the buyer did not have the intention to perform its obligation. Indeed, the goods were scrap steel and between the conclusion of the contract and the date of payment, those goods were subject to a fall in price. Thus, the buyer had an interest in the renegotiations of the contract.115
At the 13th meeting during the Vienna Conference, Mr. Felthman from the English delegate proposed an amendment to article 23 of the Draft in order to include the date of the conclusion of the contract as the relevant point in time of measurement.116 Finally this proposal was withdrawn when other delegates considered that the article had to keep its flexibility since informations provided after the conclusion of a contract had to be taken into account. Thus, the decision is left to the discretion of 32 the Court, with that risk of course not to achieve uniformity. One commentator117pointed out the discrepancies between the official versions of the Convention. Indeed, on one hand the English version is using the present tense (‘what he is entitled to expect under the contract’), and could probably lead the judge to place itself at the time when the breach is committed. Obviously, the result would favour the aggrieved party. On the other hand, the use of the past tense in the French, Spanish and Russian version would lead the Court to take the date of the formation of the contract as the point in time.
The TLDB Principle VI.3 aims to be flexible. Accordingly, it is on purpose that it does not contain a definition of fundamental non-performance. Any attempts of 33 definition would have been unsatisfactory because the substantiality of a breach may come from various situations and regard to the particular circumstances of the case are relevant. On the contrary, under the Vienna Convention a definition of fundamental breach was said to be necessary. However, the broad terms of the definition is undermining the uniformity in the interpretation of the Convention. Nevertheless one should notice that Arbitral Tribunals and National Courts are very pragmatical when determining a fundamental breach under Central List or the Convention. The result thereof is that, in pratice and without the recourse to the UPICC or PECL, the TLDB Principle affords little help for the interpretation of article 25 CISG.
Article 79 CISG on exemption is a peculiar provision. The use of the term ‘Exemptions’ translates the intention not to refer to any national legal system such as the Frenchconcepts of Force Majeure and imprévision or the English concepts of impossibility, impracticability and Frustration, or the German concept of Wegfall der Geschäftsgrundlage and its various applications121. On the contrary, the TLDB List provides a rule (Principle VI.3) dealing specifically with the Force Majeure and another one (Principle VIII.1) on hardship. Each TLDB Principle would be compared with the article 79 CISG. One may notice that the Principle on Force majeure makes a reference to ‘acts of God’, ‘force majeure’122 and ‘höhere Gewalt’.123 It means that 34the TLDB Principle covers those domestic doctrines. However it would be wrong to state they are identical.124 The same is true about the Hardship Principle which refers to the doctrines of ‘Wegfall der Geschäftsgrundlage’, ‘clausula rebus sic stantibus’, ‘frustration of purpose’.
a) An impediment
The vagueness of the CISG provision has led to the formulation of criticisms and different interpretations by commentators. In particular, it is uncertain whether or not the non-conformity in goods is a failure that can be subject to an exemption. Some commentators from a Common Law background led by Professor Nicholas consider that defects in goods should never be exempted.125 Indeed and having regard to the legislative history of the provision, impediment is similar to ‘obstacle’, a term which had been abandoned in favour of ‘circumstance’during the drafting process on the Uniform Law for the International Sales. That latter term was chosen so that defects in goods could be a failure comprised in the exemption.126 The similarity in meaning between impediment and obstacle may lead to the conclusion that only events that bar performance (late delivery for example) might be exempted.127 In the opinion of Barry Nicholas, it is clear that the intention behind the choice of that term was to prevent the seller not to be liable for defective performance even though they were complying with the other requirements of the definition. John Honnold adds that such interpretation is supported by the wording of article 79(4) CISG which provides for an obligation of notification when a party fails to perform. According to him, such a requirement is ‘absurd’ in case of delivery of hidden defect.128 From another point of view, Joseph Lookofsky considers that those commentators might have been influenced by their own domestic conceptions and considers that the legislative history of the provision affords little certainty.129 Moreover, few commentators130 36consider that the non-conformity of the goods is an event that could be exempted: the wording of article 79(1) CISG suggests also this solution since the event can concern ‘any of [the non performing party’s] obligations’ and article 35 CISG provides for the duty of the seller to deliver conforming goods. At least one decision clearly indicates that defects in goods may be exempted: in the particular circumstances of the case, it was proven that the defects came from the failure of the seller’s supplier and that the seller did not act in bad faith.131
The debate on exemption for non-conformity is also closely linked to the external character of the impediment. It could thus be argued that, to the extent that the quality of the goods delivered forms part of the sphere of activity of the seller, 37defects in goods would never be exempted. The French decision mentioned above133 would not contradict that statement because, in that case, the defects in the goods came from the supplier. On the other hand, a German decision134 left this question open because in the particular circumstances of the case the defects in the goods were ‘in any event’ not considered outside the seller’s control.
• The Vienna Convention
The TLDB Principle does not contain any official commentary that would help the reader in finding out whether or not impediment that existed before the conclusion of the contract could excuse a non-performance. Nevertheless, the doctrine of mistake is 40 expressly provided by the Central List in the Principle IV.6.3.144 So, one can conclude that Principle VI.3 provides for the occurence of an impediment after the conclusion of the contract. On the other hand, the Principle dealing with Hardship expressly provides the event to occur after the conclusion of the contract. If a similar result was intended for the Principle on force majeure it would have been expressly provided. Moreover because of the broad wording, a restrictive interpretation should not be retained and one should consider that an impediment may exist before the conclusion of the contract.
According to the Convention, a party is exempted for failure by a third party when the third party was engaged ‘to perform the whole or part of the contract’ and when 41 both of them comply with the requirements of the first paragraph. Thus, Paragraph 2 increases the obstacles for the defaulting party to be exempted. It results from the legislative history and some comments given by scholars that it should be given to article 79(2) a narrow scope. For instance it should not be interpreted so as to include a supplier. A revised text on ULIS approved by the Working Group146 demonstrates that at some point the word ‘sub-contractor’ was chosen instead of ‘third person’ in the final version. It seems that the change in formulation came from the divergent interpretations that the former term have in some legal systems.147 Nevertheless, it was still intended not to apply the second paragraph to a supplier.148 Apparently, authors agree to consider that article 79(2) CISG should be given a restrictive meaning. Denis Tallon holds that there must be an ‘organic link’ between it and the main contract.149 Accordingly, a supplier would not be considered as a third party.150 Nevertheless, the distinction between sub-contractor and supplier might not be easy to determine. It would explain the opinion of Professor Schlechtriem that in exceptional cases, a supplier would also exempt the seller when the latter could neither ‘choose nor control his auxiliary suppliers and it was not possible to procure, produce or repair the goods in any other manner’.151 In any case, the defaulting party would not be exempted for the failure by the sub-contractor if it does not comply with the requirements sets up by article 79(2).152
Article 79(3) CISG provides for the duration of the exemption. The provision was also subject to lengthy debate. Without entering into the details, it shall be pointed out that the paragraph was amended during the Vienna Conference. Indeed, the Draft counterpart provision stated that the exemption ‘has only effect for the period during which the impediment exists’. The Secretariat concluded thus that the provision provided only for temporary exemption.154 During the 27th meeting of the first committee at the Vienna Conference, the delegate from Norway made a proposal to amend paragraph 3 considering that an undesirable outcome would result from the wording used in the Draft in cases when the impediment ceases after a long period of time and the performance of the contract would become too burdensome, ‘unrealistic’.155 An alternative proposal was to delete the word ‘only’ between ‘has 43 effect’ and ‘for the period’ with that underlying idea that it would provide a permanent relief. The first solution was rejected because some delegates considered that it would lead to the adoption of the doctrine of Frustration, imprévision, or hardship to which they were reluctant. So, as a compromise, the second solution was adopted and the word ‘only’ deleted. As a consequence, different interpretations of paragraph (3) are possible: In his commentary, Denis Tallon still mentions the rule with the word ‘only’ and considers that the exemption lasts during the length of the impediment. However, he considers that Paragraph (5) provides for the same result that a permanent remedy because if the over-due performance leads to a fundamental breach of contract, the contract may be avoided.156 On the contrary, Barry Nicholas considers that the intention behind the amendment was to leave open the possibility that the exemption might continue even after the period during which the exemption existed157. The paragraph therefore might be read as follows: ‘The exemption has effect for the period during which the impediment exists and may have permanent effect if after the impediment has ceased to exist the circumstances have so radically changed that it would be manifestly unreasonable to hold the non-performing party liable.’ Nevertheless, the same author regrets that a Court would not reach such a solution without the assistance of the legislative history.
The obligation is provided in Article 79(4) CISG. It is an important duty because if the non-performing party fails to notify the other party of the impediment and its 44 consequences within a reasonable period of time, it may be liable for damages.159 On the contrary, the TLDB Principle VI.3 does not contain such an obligation. Nevertheless such a duty is expressly provided in Principle IV.5.8 ‘Duty to cooperate/ Duty to notify’ and it states that ‘[e]ach party is under a good faith obligation to notify the other party of any problems that occur in the performance of the contract and to cooperate with the other party when such cooperation can reasonably be expected for the performance of that party's obligations.’ Thus, the non-performing party would act in bad faith if it does not notify the other party of the occurence of an impediment and would be probably liable to pay damages.160
There are two main differences between the Vienna Convention and the Central List. On one hand, under the Convention, an exempted party is never liable for damages whereas under the Central List it might be liable in cases where the non-performance becomes unreasonable. One the other hand, the Convention provides a wider range of remedies (reduction of price, specific performance, avoidance of contract) available to the injured party than under the Central List (damages and termination of contract). Some commentators161 of the Vienna Convention warned about the absurdity to allow a party to ask for specific performance even though the performance is impossible. Indeed, if the seller is compelled to perform although performance is impossible, the result would be more onerous than to pay damages.16245
However it seems not to be the intention of the Vienna Convention. Indeed, the Secretariat’s Commentary provides an illustration of the exercise of the specific performance. In substance, if the seller was to deliver unique goods that were later on destroyed, specific performance would not be a remedy available to the buyer. On the other hand, if the seller has to deliver generic goods, the buyer would be able to request specific performance and the seller to deliver substitute goods.
The Principle expressly provides a definition of hardship and its legal consequences. The debtor can benefit from the rule if the event, whether legal, technical, political, financial or economical, occurs after the conclusion of the contract, that it could not reasonably have been taken into account at the time of the conclusion of the contract, and that it fundamentally alters the equilibrium of the contract. If a situation of hardship is determined, three legal consequences are available: (1) the aggrieved party (non-performing party) may claim the renegotiation of the contract. (2) In case of failure, both parties may apply to a Court or an Arbitral Tribunal to have the 46 contract adapted to the change of circumstances – provided it is possible under the applicable procedural law or, (3) terminated.
As written previously, the term ‘impediment’ is not defined. In itself, that word may contain several meanings. Here, the issue is to ascertain whether or not economic difficulties like the rise in prices may be a ground for exemption. For Professor 47 Schlechtriem, the change in wording from ‘circumstances’ in the ULIS to ‘impediment’should not prevent the inclusion of economic difficulties to which he refers under the term ‘unaffordability’.168
In order to understand the controversy that arises in the relation between articles 14(1) and 55 of CISG, it might be helpfull, first, to present both articles and the debate that arose during their drafting. 49 1. The background
Article 14(1) is identical to the Draft counterpart.173 At some point, it was contemplated that, even though an offer did not determine the price or did not contain a provision for its determination, but that indicated the intention to be bound, the price was that generally charged by the seller at the time of the conclusion of the contract or, in absense of such a price, the price generally charged for such goods under comparable circumstances.174 At that time, the wording was not in 50 contradiction but just repeated article 36 of the 1976 Draft on the CISG.175 For various reasons, countries such as Ghana, USSR and France rejected this wording and requested its deletion so that in the formation of a contract, the price had to be determined or determinable.176 Other countries, although not in opposition with open price contract, were also in favour for a change in the wording. It resulted that the 1978 Draft Convention adopted the actual wording of article 14(1) as a compromise. However, during the Vienna Conference, the debate arose again. Indeed, some delegates proposed to delete the second sentence of article 12(1) [that became article 14(1) CISG] because article 51 [that became article 55 CISG] led to an opposite solution. Thus, a Contracting State that ratifies Part II and III of the Convention would conclude that a contract is not valid if the price is not determined.177 Moreover, in countries like United Kingdom or United States, an open price contract is valid; and the price charged is, basically, a reasonable price.178 On the other hand, many other countries were opposed to the deletion of that seconde sentence. The French delegate considered that the second sentence contained the essential elements of the definition of an offer and that the determination of price was necessary to protect the weaker party to a contract of sale, in particulary in long term contract of raw materials, in which it has no control over the price.179 A similar reasoning was arisen when a buyer having its place of business in a developing country sought to purchase industrialized goods from developed countries. To the extent that there is not a market price for most of those goods and that the buyer might be the weakest party, it is necessary to protect the buyer from any attempt from the seller to impose an unfavourable price. The delegate from Ghana also considered that contract could be formed only if the price was determined or determinable whereas article 51 of the Draft dealt with the specific situation that may arise in some countries where a contract is validly formed even if there is no agreement on the price.180 With respect 51to the USSR, the determination of the price was necessary in a planned economic system. Not only the proposal for the deletion of the second sentence was rejected but also any proposal to amend the wording of article 12(1) so to make it clearer.181 Finally, the wording of article 12(1) did not change but, in counterpart, the wording of article 51 of the Draft was amended.
The legislative history of the provision is, at some point and as demonstrated in (a), closely linked to the article 14 CISG. Article 51 was drafted before UNCITRAL had adopted Part II of the Draft Convention. Faced to the apparent contradiction between both articles, some delegates proposed the deletion of the second sentence of article 12(1). This proposal having been rejected, other delegates, from Ghana for example, suggested the deletion of article 51 of the Draft182 in order to avoid any confusion for the Courts when applying article 12(1). Nevertheless, many other delegates, were of the opinion to keep article 51 because it was said to be necessary in some circumstances: for the sale of spare parts at a not fixed price to be used for machines purchased earlier;183 if a State has not planned to ratify Part II or the parties have excluded its application;184 or because the wording of article 12 was enough flexible and that both articles should be harmonized so that as many States as possible ratify 52Part II and III of the Convention.185 Finally, article 51 of the Draft was kept with an amendment: instead to refer to the price charged by the seller, the actual article 55 CISG refers to the ‘price generally charged at the time of the conclusion of the contract’.
It seems evident that when the Convention was adopted, nobody could expect a uniform interpretation of both articles. Indeed, scholars are divided on whether or not to apply article 55 only in restrictive circumstances. For instance, Professors Farnsworth and Eörsi starts their analysis from an a contrario interpretation of article 14(1) – if no price is determined or determinable in an offer, there is no offer, without an offer there is no contract – to conclude that article 55 CISG would apply only in those cases where a State did not ratify Part II of the Vienna Convention.186 The Secretariat Commentary on article 12(1) of the Draft leads also to that solution.187 On the other hand, other scholars like Professors Honnold and Lookofsky and Alejandro M. Garro consider that article 55 could apply in a wider range of situations. The starting point is the wording of article 55 CISG that states that a open price contract might be valid. Thus, Professor Honnold takes the hypothesis where a contract was not formed by the exchange of an offer and its acceptance (i.e. an exchange of communication) but where a contract was signed or where the contract resulted from the conduct of the parties (Arts. 18(3) and 8(3) CISG). To the extent that the parties did intend to be bound although there is not provision on the price, nothing should prevent article 55 to be applied.188 Professor Lookofsky also considers that the answer to the conflicting wording of articles 14(1) and 55 CISG shall be the intention of the parties, whether or not they intended to 53 derogate the principle of definitiveness of article 14(1) CISG in accordance with article 6 CISG.189 The interpretation given by Alejandro M. Garro is rather different. He considers that the meaning of both articles might be reconciled. Indeed, article 14(1) provides that a price can be implicitly stated and article 55 provides that an open price contract is a contract with an implicit price fixed by operation of law, the price ‘generally charged at the time of the conclusion of the contract’.190 However those three authors understand that, in practice, a Court might be reluctant to admit open price contracts, in particular if its domestic law invalids them. Nevertheless, one could state at this stage that what matters is the international character of the Vienna Convention.
Among the first Court decisions that deal with this issue, one shall refer to the Malev case.191 In that case which involved an American manufacturer of aircraft engines and a Hungarian airline company, the Supreme Court had to decide whether or not there was a contract of sale. According to the facts of the case, the American manufacturer made alternative offers of engines depending on the Hungarian party’s selection for Boeing or Airbus aircraft. The offer was amended to include another model of engine for a Boeing aircraft. Two models of engine were proposed for each model of aircraft (PW 4056 and PW 4060 for Boeing and PW 4152 and 4156 for Airbus). Later on, the Hungarian party sent a telex to the American party stating it had selected the latter’s party engines for the Boeing aircraft. Afterward, it notified the offeror it did not want to choose those engines. With respect to the determination of price, the Supreme Court held that the proposal did not comply with article 14(1) CISG because, on one hand, for the PW 4060 model no price was stated and, on the other hand, regarding to both models of engine for the Airbus aircrafts a price was stated only for the spare engines (the motor stricto sensu) but not for the engine systems whose prices could not be determined by application of article 55 CISG since there is not market price for such goods. The decision has been criticized because part of the solution was based on the lack of determination of price for goods that the Hungarian party finally did not accept. It means that the lack of determination of one of the products that constitutes the proposal affects the whole 54 proposal preventing it to be a definite offer under CISG. Moreover, according to Professor Flechtner192, the solution given ‘reward[ed] Malev’s bad faith’ and did not take into account the international character of the CISG.
The above mentioned Principle is contained in Section 5 on the contractual obligations and not in a section dealing with the formation of contract. Morever there is no Principle within the Central List which contradicts Principle IV.5. On the contrary, Principle IV.2.1 on the contractual consent is using a flexible wording. Indeed, with respect to the formation of contract, the Central List relevant provision does not seek to describe in detail how an international contract might be concluded. In particular, there is neither a definition of an ‘offer’ nor of an ‘acceptance’ but, also, there is not a reference to the communication of an offer and its acceptance in 55 order to conclude a contract. Indeed, the relevant Principle just provides that ‘[a] valid contractual consent requires that the parties intend to be legally bound and that they have sufficiently identified the terms of the contract with respect to the parties and the subject matter’. Such a flexible wording is preferable in International Commercial Law and understandable within the Central List which does not deal only with the international sale of goods.
The TLDB and the Vienna Convention contain various provisions dealing with damages. The damages provisions within the Central list are included in chapter VII, between the chapters that deal with non-performance and hardship and, in chapter IX if one include the duty to pay interest. With respect to the CISG, the provisions dealing with damages appear in article 45(1)(b) in chapter II section III on the 56 remedies available to the buyer in case of breach of the seller’s obligation, in article 61(1)(b) in the subsequent chapter and in the articles 74 to 78 located in the chapter V on the provisions common to the obligations of the seller and of the buyer. For the purposes of this fifth and final part, we shall focus only to the comparison between the TLDB principles VII.1 to VII.3.2 and article 74 CISG that deal with the principles of full compensation and of foreseeability of loss.
a) A non-performance
Indeed, Article 7.4.3 of UNIDROIT Principles provides that ‘[c]ompensation is due only for harm, including future ham, that is established with a reasonable degree of certainty’. Thus, in applying that article to interpret the Central List provisions on damages, future loss might be included when calculating the amount of damages, as soon as they are certain. On the other hand, the test within the UNIDROIT is translated by the added words: ‘with a reasonable degree of certainty’ which do not appear in the Principle VII.3.1. Thus, it might be held that the TLDB Principle is stricter than the UNIDROIT provision and one may consider that future loss might no be included when calculating the amount of damages because they cannot be ascertained at one hundred percent and thus are not ‘actual’. Such interpretation seems to be more in line with the literal meaning of the word. At the end the outcome is unclear and, unfortunately, the cases available on the Central List databases are unhelpful.
In relation to lost profits, the Central List Principle VII.3.2 provides that ‘[t]he party who suffers a loss from the failure of the other party to deliver is entitled to calculate his loss based on the difference between the price in the non-executed contract and the market price at the date of default.’199 The rule according to which lost profits are also to be reimbursed forms part of the general rule of full compensation and, in that sense, constitutes a ‘universal consensus’.200 Principle VII.3.2 provides expressly for a method to calculate the gains of which the aggrieved party was deprived: it is the difference between the price of the unexecuted contract and the market price at the 59 date of the default. A problem might arise when there is no market price. The Central List does not contain an express provision in that case. Thus regard has to be had on the general rule of Principle VII.1 and arbitrators would have to choose the suitable method. Accordingly, the calculation of the damages might be based on the evaluation of the ordinary and foreseeable course of business.201 Nevertheless, the aggrieved party may seek to enrich itself. The TLDB Principles forbid this possibility because it would jeopardize the goal of full compensation and would be contrary to the Principle X.1 on unjust enrichment.202
Like the Central List Principles, the Vienna convention does not expressly provide for future loss, but compared with principle VII.3.1, Article 74 does not refer to an ‘actual loss’. Here again, recourse to the UNIDROIT Principles and, in particular, to Article 7.4.3 on ‘Certainty of Harm’ might be helpful. Indeed, Article 7.4.3 explicitly provides the liability for future damages and in itself, nothing in article 74 CISG 61 prevents for the recover of future damages. In particular and according to a South African Professor,206 a Court may follow two approaches: on one hand, the amount of the loss including future loss is established with certainty, the court will award that amount. On the other hand, the loss cannot be established with sufficient certainty and, thus, the Court will use of its discretion.
Article 74 CISG entitles the aggrieved party to recover loss of profits. However, contrary to TLDB Principle VII.3.2, CISG article 74 does not provide a specific method to calculate lost profits. According to the Secretariat Commentary, lost profits must be calculated ‘in the manner which is best suited to the circumstances of the breach’.209 Different examples are given depending whether the buyer or the 62 seller is in breach, whether the goods have been already manufactured or not and, if so, whether they can be resold.210 Moreover, Arts 75 and 76 CISG provide methods of calculation when the contract has been avoided for breach of either the buyer or the seller: according to article 75 CISG, where the seller is in breach and the buyer made a replacement transaction or where the buyer is in breach and the seller had to resell the goods, the damages including lost profits are equal to the difference between the contract price and the price of the substitute transaction. Article 76 provides for the difference between the contract price and the market price in those cases where no purchase or resale was made under article 75.
Difficulties might arise in more specific situations. Indeed, according to Professor Schneider, although re-sale lost profits are recoverable, less direct losses like profits lost by a manufacturer-buyer ‘when [for example] goods necessary for the production are defective’ should not be recoverable under the Convention but by application of the lex fori.211 In practice, U.S Courts went far beyond in alleging that calculation of lost profits was a matter not specifically dealt within Convention and that recourse to domestic law was to be made: ‘lost profits are determined by calculating the hypothetical revenues to be derived from unmade sales less the hypothetical variable costs that would have been, but were not, incurred’.212 Such a recourse to domestic law endangers the Convention’s goal to provide for a uniform law. Moreover, although not specifically, the Convention provides methods of calculation even though their choice depends on the specific circumstances of the case. In other cases, Courts have calculated depending on whether there was a substitute transaction213 or a market price for the goods concerned.214 The limit of those methods is that, under the Vienna Convention, they are applicable only where the contract is avoided. However not any breach of contract can lead to the avoidance of the contract under article 25 CISG. In situations in which the contract has not been 63 avoided, Courts should have discretion as soon as they comply with the general rule of full compensation. For instance, in a Belgian decision, the amount of lost profits was determined ‘ex aequo et bono, taking into account the probability of a cover sale by the seller at a price significantly lower than the one agreed upon in the contract.’215
Compared with the TLDB Principle VII.2, Article 74 CISG second sentence does not includes a standard of reasonableness. During the Vienna Conference, an amendment 66 proposal from Pakistan intended to add the concept of reasonableness in order to provide for a more objective wording. Although that proposal was rejected, article 74 CISG, like the TLDB Principle, contains a mixture of subjective and objective criteria. Moreover the words ‘in the light of the facts and matters (...)’ might be interpreted as constituting a criteria similar to the standard of reasonableness under the Central List. Finally, because the criterion of reasonableness appears many times within the Convention, it might be held that it constitutes a general principle on which the convention is based (Art.7 CISG) and thus applicable to Article 74.
The Vienna Conventions aims to last in times. References to the legislative history of the text in order to interpret its provisions may threaten the capacity of adaptation of the Convention to the new developments of the transnational commercial law. It is particulary true with respect to general concept or principles like the concept of good faith. Whereas scholars are divided on the meaning of the concept when interpreting article 7(1) CISG, the TLDB principle I.1 affords an easy and consensual solution in line with the most recent developments in national laws and according to which parties to a contract have a duty to act in good faith. Consequently, the TLDB Principle is a useful basis for the interpretation of article 7(1) CISG. However, the flexibility and openness of the TLDB list does not fit automatically to every provisions of the Convention. The analysis in Part II demonstrates that the TLDB Principle VI.1 does not provide a definition of fundamental non-performance nor it affords a guideline that would allow the practicioners to know when they precisely 67 face a fundamental non-performance. On the other hand, it was demonstrated that a definition of fundamental breach under the Convention was necessary in the light of its role within the text. However, article 25 CISG is subjected to different interpretations and fails of some practicability. In the conclusion of the second part, it was held that the substantiality of a contractual breach was to be considered in the light of the specific circumstances of each case. This statement is in line with the structure and goal of the TLDB list which, thus, does not constitute a helpful basis for the interpretation of article 25 CISG. In Part three and four, the solution given by the Convention on the subject-matters of exemption and price determination are rather originals compared with the TLDB counterparts. Indeed, on one hand, whereas the Central provides for Force majeure and Hardship in two different Principles, the CISG adopts a ‘neutral’ position avoiding any recourse to national concepts that would endanger a uniform interpretation. It was finally held that the concept of exemption within the CISG was in-between the concepts of force majeure and hardship and that the compromise reached on the issue of temporary exemption is jeopardising the uniformity of interpretation. The result thereof is that, in itself, the TLDB Principles are of little help or, at least in a negative way. On the other hand, whereas the Central admits that a contract may be formed although a price is not determined and provides a method of calculation of this price, the Vienna Convention contains two antagonist articles 14 and 55, the first one denying that a contract with undetermined price may exist, the second providing a method of price determination when a contract has been validly made although without a determined price. Again different interpretations to both articles were given and presumably, TLDB principles IV.5 may consitute a basis, at least for the interpretation of article 55 CISG. Finally, the provisions on damages of the TLDB and the CISG share many similarities. In both cases, the principle of full compensation and its main limit, the principle of foreseeability of the loss are admitted. On the other hand, there are some differences on specific issues such as the admission of futures losses, in which the solution seems unclear within the TLDB, or lost profits where a specific method of calculation does not exist within the Vienna Convention. Since the TLDB principles are drafted in terms as broad as the provisions of article 74 CISG, they afford little help to the interpretation of the Convention.
The Central list is an instrument of international trade law completly different to the CISG and almost at the opposite: The TLDB was created by a team of academics and law students under the direction of Professor Klaus Peter Berger whereas the Convention was drafted after a long process of deliberations between scholars and delegates of different legal cultures. The TLDB aims to deal with every aspects of the lex mercatoria whereas the CISG is focused on the international sale of goods. The CISG is a traditional codification of rule whereas the purpose of the TLDB is to provide a new form of codification. Consequently, the contribution of the TLDB to the interpetation of the Vienna Convention is not easy to evaluate. The practitioners should use it just as an additional tool for a better understanding of the Convention and of the transnational commercial law.
Michael Joachim Bonell ‘Introduction to the Convention’ in Bianca-Bonell Commentary on the International Sales Law, Giuffrè: Milan (1987) [hereinafter in 70 ‘Bianca-Bonell Commentary’], 1-20, available on http://www.cisg.law.pace.edu/cisg/biblio/bonell-bbintro.html#ii, accessed on 2006-03-23.
Victor Knapp, ‘Article 74’ in ‘Bianca-Bonell Commentary’ 538-548, available on http://www.cisg.law.pace.edu/cisg/biblio/knapp-bb74.html, accessed on 2006-03-31.
Reinhard Zimmermann and Simon Whittaker Good Faith in European Contract Law, Cambridge University Press 2000, also available on www.TLDB.de – DocID: 132600 (citations only), last visited on 2006-02-07.
John Y. Gotanda, ‘Recovering Lost Profits in International Disputes’, (2004) 36 GILJ 61 at 111, available on www.TLDB.de – DocID: 123430 (citations only), accessed on 2006-03-31.
ICC Award No. 2291, 1976 Clunet, 989 and seq. available on www.TLDB.de – DocID: TLDB-DocID: 202291 (Abstract), accessed on 2006-01-20.
ICC Award No. 8365, 1997 Clunet, 1078, available on www.TLDB.de – DocID: 208365, accessed on 2006-03-30.
U.S. District Court, N.D., New York Delchi Carrier S.p.A. v. Rotorex Corp., case number 88-CV-1078, 09.09.1994, available on www.unilex.info, accessed on 2006-04-01.
Court of Appeal of Grenoble (France), Sté Calzados Magnanni v. Sarl Shoes General International - S.G.I., case number 96J/00101, 21.10.1999, available on www.unilex.info, accessed on 2006-03-31.
General Assembly Resolution 2205 (XXI) of 17 december 1966 on the Establishment of the United Nations Commission on International Trade Law, 78 available on http://www.uncitral.org/uncitral/en/commission/resolutions.html, accessed on 2006-03-24.
Summary Records of the 5th meeting of the First Committee, available at http://www.cisg.law.pace.edu/cisg/firstcommittee/Meeting5.html, accessed on 2006-03-30.
Secretariat Commentary on article 23 of the 1978 Draft [that became article 25 CISG], available on http://www.cisg.law.pace.edu/cisg/text/secomm/secomm-25.html, accessed on 2006-03-30.
Hossam El-Saghir in the Editorial Remarks, Guide to article 25 [CISG], comparison with Principles of European Contract Law, July 2000, available on 81 http://www.cisg.law.pace.edu/cisg/text/peclcomp25.html#er , accessed on 2006-03-30.
1Bernard Audit, ‘The Vienna Sales Convention and the Lex Mercatoria’ in rev. ed., Carbonneau ed., Lex mercatoria and arbitration, Juris Publishing (1998) at 173, available on http://www.cisg.law.pace.edu/cisg/biblio/audit.html, accessed on 2006-03-29.2Michael Joachim Bonell, ‘Introduction to the Convention’ in Bianca-Bonell Commentary on the International Sales Law, Giuffrè: Milan (1987) [hereinafter in Bianca-Bonell Commentary], 1 at 1 to 4, available on http://www.cisg.law.pace.edu/cisg/biblio/bonell-bbintro.html#ii, accessed on 2006-03-23.3See the General Assembly Resolution 2205 (XXI) of 17 december 1966 on the Establishment of the United Nations Commission on International Trade Law, available on http://www.uncitral.org/uncitral/en/commission/resolutions.html, accessed on 2006-03-24.4UNICTRAL Report at its second session, Yearbook I (1968-1970) at 173, available on http://www.uncitral.org/pdf/english/yearbooks/yb-1968-70-e/yb_1968-1970_e.pdf, accessed on 2006-03-29.5UNCITRAL Report at its eleventh session, Yearbook IX (1978), available on http://www.uncitral.org/pdf/english/yearbooks/yb-1978-e/yb_1978_e.pdf, accessed on 2006-03-29.6Supra footnote 2 at 5.7See http://www.uncitral.org/uncitral/fr/uncitral_texts/sale_goods/1980CISG_status.html, last visited on 2006-03-29.8In the Preambule of the UPICC it is provided that the Principles may be used to’ interpret or supplement international uniform law instruments’.9Supra footnote 1 at 176.10Klaus Peter Berger, ‘Lex Mercatoria Online : the CENTRAL Transnational Law database at www.tldb.de’, Arbitration International (2002) Volume 18 Number 1, at 83.11Ibid. at 84.12Ibid. at 85.13Ibid. at 85-86.14For instance, Andreas F. Lowenfeld, ‘Lex Mercatoria: An Arbitrator's View’, Arb.Int’l 1990, 133 at 148, available on www.TLDB.de – DocID: 126000.15Michael Mustill, ‘The New Lex Mercatoria: The First Twenty-five Years’, Arb.Int'l 1988, 86 at 110-114., available on www.TLDB.de – DocID: 126900.16Supra footnote 10 at 87.17At the date of 2006-03-27.18Supra footnote 10 at 86.19www.TLDB.de>list of Principles, Principle I.1.20ICC Award No. 2291, (1976) Clunet 989 at 990 Available on www.TLDB.de – DocID: TLDB-DocID: 202291, accessed on 2006-01-20.21Supra footnote 15 at 111.22Supra footnote 14, at 148.23Emmanuel Gaillard and John Savage, Fouchard Gaillard Goldman on International Commercial Arbitration [hereinafter ‘Fouchard, Gaillard, Goldman’], The Hague 1999, at 814 and 828, available on www.TLDB.de – DocID: 130600, accessed on 2006-03-29.24‘De l’essence de la lex mercatoria’, quotation from Berthold Goldman in ‘La Lex Mercatoria dans les contrats et l’arbitrage internationaux : réalité et perspectives’ 1979 JDI 475 and mentioned by Pierre Mayer, ‘Le Principe de Bonne Foi devant les Arbitres du Commerce International’, in Festschrift Pierre Lalive, Basel/Frankfurt 1993, at 543, also available on www.TLDB.de – DocID : 115700, accessed on 2006-03-29.25ICC Award No. 5721 (1990) Clunet, 1019 at 1023, available on www.TLDB.de – DocID: 205721 (Abstract), accessed on 2006-03-29.26ICC Award No. 5953, (1990) Clunet 1056 at 1060, available on www.TLDB.de – DocID: 205953 (Abstract), accessed on 2006-03-29.27Filali Osman les Principes Généraux de la Lex Mercatoria, under the collection thèses-bibliotèque de droit privé, Vol. 224 Paris, LGDJ, 1992 at 19, available on www.TLDB.de – DocID : 106300, (only citations) accessed on 2006-03-29.28www.TLDB.de Principle I.2, accessed on 2006-03-29.29www.TLDB.De Principle IV.5.8,accessed on 2006-03-29.30ICC Award 3131 (1983) Rev. d. Arb., 525 at 530, available on www.TLDB.de – DocID 203131 (Abstract), accessed on 2006-03-29.31Supra footnote 26.32Supra footnote 15 at 111.33As defined in the Black’s law dictionary 7th edition : ‘A principle especially a legal principle that is widely adhered to’.34John Felemegas, The United Nations Convention on Contracts for the International Sale of Goods: Article 7 and Uniform Interpretation, Pace University Essay (February 2001), footnote 229, available at http://www.cisg.law.pace.edu/cisg/biblio/felemegas.html, accessed on 2006-03-29.35Ibid at footnote 233.36Ibid at footnote 230.37Reinhard Zimmermann and Simon Whittaker Good Faith in European Contract Law, Cambridge University Press 2000, at 47, also available on www.TLDB.de – DocID: 132600 (citations only), accessed on 2006-03-29.38For instance, J.F. O’Connor, Good Faith in English Law, Adershot 1991, also available on www.TLDB.de – DocID:106100 (citations only), accessed on 2006-03-29.39Supra footnote 34 between footnote 246 and 247.40Supra footnote at footnote 259.41E. Allan Farnsworth, ‘Duties of good faith and fair dealing under the Unidroit Principles, relevant international conventions, and national laws’ 1995 Tul.J.Int.Comp.L 47 at 52, also available on www.TLDB.de – DocID: 122100, accessed on 2006-03-29.42Supra footnote 34, between footnotes 262 and 276.43Supra footnote 34, between footnotes 277 and 278.44Supra footnote 37 at 30 ; supra footnote 34.45Supra note 37 at 30.46Supra footnote 34 between footnotes 286 and 289.47Pierre Schlechtriem, ‘Good Faith In German Law and In International Uniform Laws’, Centro di studi e ricerche di diritto comparato e straniero (Research and studies center of foreign and comparative law), Conference held in Rome (February) 1997, citations available on www.TLDB.de – DocID: 107700, accessed on 2006-03-30, full text available on http://soi.cnr.it/~crdcs/crdcs/frames24.htm, accessed on 2006-03-30.48Michael Joachim Bonell, in Bianca-Bonell Commentary, 65 at 83 paragraph 2-4, available on http://www.cisg.law.pace.edu/cisg/biblio/bonell-bb7.html, last visited on 2006-03-30.49Ibid.50Supra footnote 41 at 55 footnote 52, quotation from Thomas E. Carbonneau&Marc S. Firestone, ‘Transnational Law making: Assessing the Impact of the Vienna Convention and the Viability of National Adjudication’, (1986) 1 EMORY J. INTL’DisP. RESOL. 51, 74.51Supra footnote 41 at 55 footnote 54 , quotation from E. Allan Farnsworth ‘Problems of Unification of Sales Law from the Standpoint of the Common Law Countries’, in 7 Digest of Commercial Laws of the World (Dobbs Ferry: Oceana, March 1980). The wording was probably used in an ironically way.52Alejandro M Garro, ‘Reconciliation of Legal Traditions in the U.N. Convention on Contracts for the International Sale of Goods’, (1989) 23 International Lawyer, available on http://www.cisg.law.pace.edu/cisg/biblio/garro1.html accessed on 2006-03-30, at footnote 109: quotation from Gyula Eörsi, ‘A Propos the 1980 Vienna Convention on Contracts for the International Sale of Goods’ (1983) 31 Am. J. Comp. L. 333, 346. (‘The result was strange but gained for the principle of good faith a foothold in an international convention for unification of law. It is hoped that this meager result represents a modest start.’).53Ibid at footnote 108, quotation from M.J. Bonell, Methodology in Applying Uniform Law for International Sales Under the U.N. Convention (Wien 1980), in Italian National Reports to the XII International Congress of Comparative Law 43, 62 (1986).54Supra footnote 5 page 65.55Supra footnote 5 page 66.56Supra footnote 5 page 35.57Supra footnote 5, page 36.58See the summary of the proceedings at the Vienna Conference http://www.cisg.law.pace.edu/cisg/1stcommittee/summaries7.html#b, accessed on 2006-03-30.59Summary Records of the 5th meeting of the First Committee, available at http://www.cisg.law.pace.edu/cisg/firstcommittee/Meeting5.html, point 40, last visited on 2006-01-23.60Supra, point 47.61Supra, point 50.62Supra note 24 at 56.63Supra.64ICC arbitral award, W. v. R., Paris, , 23.01.1997 at www.unilex.info - Case, [Abstract] number: 8611/HV/JK, accessed on 2006-03-30.65Gyula Eörsi, comments on ‘General provisions’ in Galston & Smit ed International Sales : The United Nations Convention on Contracts for the International Sale of Goods [hereinafter ‘Galston & Smit’], Matthew Bender (1984), Ch. 2, page 2-7, available on http://www.cisg.law.pace.edu/cisg/biblio/eorsi1.html , accessed on 2006-03-30.66Troy Keily, ‘Good Faith & the Vienna Convention on Contracts for the International Sale of Goods (CISG)’, (1999) 3 VJ 1, 15 at 22-23, available at www.TLDB.de – DocID: 131400, last visited on 2005.11.08.67Arthur Hartkamp, ‘The UNIDROIT Principles for International Commercial Contracts and the United Nations Convention on Contracts for the International Sale of Goods’, in Boele-Woelki/ Grosheide/ Hondius/ Steenhoff (eds.), Comparability and Evaluation: essays on comparative law, private international law and international commercial arbitration (Dorrecht, Boston, London, T.M.C. Asser Institute/Nijhoff Publishers 1994), 85 at 87, also available on www.TLDB.de – DocID: 113000; M.J. Bonell, supra footnote 48 at 84.68A. Hartkamp, Ibid.69Cour d’Appel de Paris, SARL Bri Production “Bonaventure” v. Société Pan African Export, 22.02.1995, available on www.unilex.info – Fulltext.70M.J. Bonell, supra footnote 48, at 86.71Ibid.72Supra footnote 48 at 86.73Supra footnote 48 at 88.74COMPROMEX (Comision para la Proteccion del Comercio Exterior de Mexico), case number M/115/97, Dulces Luisi, S.A. de C.V. v. Seoul International Co. Ltd. Seoulia Confectionery Co., 30.11.1998, www.unilex.info (Full text) at paragraph 10 after the word ‘Considerandos’.75Troy Keily, supra footnote 66 at 28 to 32 ; A. Hartkamp, supra footnote 67 at 87; M.J Bonell, supra footnote 48 at 85.76Secretariat Commentary on article 7 available on http://www.cisg.law.pace.edu/cisg/text/secomm/secomm-07.html, accessed on 2006-03-30.77Tribunale di Padova, case number 40552, 25.02.2004, available on http://cisgw3.law.pace.edu/cases/040225i3.html, at the heading ‘substantive issues’, accessed on 2006-03-30.78Court of Appeals (Oberlandesgericht) München, 15.09.2004, [7 U 2959/04], available on http://cisgw3.law.pace.edu/cases/040915g2.html, accessed on 2006-03-30.79Supra footnote 66 at footnote 91: Ulrich Magnus, ‘General Principple of UN-Sales Law’.80See Farnworth, supra note 41 at 52 and 53; Troy Keily supra footnote 66 at 38.81www.TLDB.de> List of Principles, Principle VI.1.82Supra footnote 15.83Ibid.84ICC Award No 2583, 1977 Clunet, at 950 et seq. available on www.TLDB.de – DocID: 202583 (Abstract), accessed on 2006-03-30.85Supra footnote 23 at 831.86ICC Award No 4761, 1987 Clunet, 1012 available on www.TLDB.de - DocID: 204761 (Abstract), accessed on 2006-03-30.87ICC Award No. 8365, 1997 Clunet, 1078 at 1080, available on www.TLDB.de – DocID: 208365, accessed on 2006-03-30.88ICC Award No. 1795, 1999 YCA, 196 at 200, available on www.TLDB.de TLDB-DocID: 201795 (Abstract), accessed on 2006-03-30.89Ibid; also ICC Arbitral Award 9797, 2000 ASA Bull., 514, available on www.TLDB.de – DocID 209797 (Abstract), accessed on 2006-03-30.90The Preambule states that the UNIDROIT Principles ‘may be applied when the parties have agreed that their contract be governed by general principles of law, the lex mercatoria or the like. They may be applied when the parties have not chosen any law to govern their contract.’91UNIDROIT Principle 7.3.1, www.unilex.info.92Under the heading ‘Principles, Restatements, Model laws’.93Hossam El-Saghir in the Editorial Remarks, Guide to article 25 [CISG], comparison with Principles of European Contract Law, July 2000, available on http://www.cisg.law.pace.edu/cisg/text/peclcomp25.html#er , accessed on 2006-03-30.94Supra footnote 88.95Supra footnote 93.96Supra footnote 86.97Michael Will, ‘Article 25’, in Bianca-Bonell Commentary on the International Salse Law, (Giuffrè: Milan 1987) at 205, available on http://www.cisg.law.pace.edu/cisg/biblio/will-bb25.html, accessed on 2006-03-30; also Chengwei Liu, ‘The concept of Fundamental Breach: Perspectives from the CISG, UNIDROIT Principles and PECL and case law’ [2nd edition: Case annotated update (May 2005)], under the heading ‘In General’, available on http://www.cisg.law.pace.edu/cisg/biblio/liu8.html, accessed on 2006-03-30.98Uncitral Yearbook VII (1976) at 101, available on http://www.uncitral.org/pdf/english/yearbooks/yb-1976-e/yb_1976_e.pdf, accessed on 2006-03-30.99Supra footnote 97, at the heading ‘gravity of the consequence of non-performance’.100Supra footnote 98.101Ibid. ; same comments given by the Secretariat Commentary on article 23 of 1978 Draft, available on http://www.cisg.law.pace.edu/cisg/text/secomm/secomm-25.html, accessed on 2006-03-30.102Hossam El-Saghir, supra footnote 93 under the heading ‘substantial detriment’ and Chengwen Liu, supra footnote 97 under the heading ‘Gravity of the Consequences of Non-performance’.103Mª del Pilar Perales Viscasillas in ‘El Contrato de Compraventa Internacional de Mercancias (Convencion de Vienna 1980)’, 2001, Chapter VI, under the heading ‘Circunstancias en que se puede declarar resuelto el contrato. Incumplimiento esencial’, available on http://www.cisg.law.pace.edu/cisg/biblio/perales1.html, accessed on 2006-03-30.104Michael Will, supra footnote 97 at 211-212.105Jacob S. Ziegel ‘The Remedial Provisions in the Vienna Sales Convention : Some Common Law Perspectives’, in ‘Galston & Smit’, Ch. 9, at 9-15 9-16, available on http://www.cisg.law.pace.edu/cisg/biblio/ziegel6.html, accessed on 2006-03-30.106Hossam El-Saghir, supra footnote 93.107Ibid.108Ibid.109Robert Koch, ‘Commentary on Whether the UNIDROIT Principles of International Commercial Contracts May Be Used to Interpret or Supplement Article 25 CISG’, available on http://www.cisg.law.pace.edu/cisg/biblio/koch1.html#rkiv, accessed on 2006-03-30.110Schweizerisches Bundesgericht, 15.09.2000, Switzerland, case number 4C.105/2000 available on www.unilex.info (Full text), accessed on 2006-03-30.111Appellate Court, Frankfurt, 17.09.1991, case number 5 U 164/90, available on http://www.cisg.law.pace.edu/cisg/wais/db/cases2/910917g1.html, accessed on 2006-03-30.112Court of Appeal (Oberlandesgericht) Munich, 01.07.2002, available on http://www.cisg.law.pace.edu/cisg/wais/db/cases2/020701g1.html, accessed on 2006-03-30.113Cour d’Appel de Paris, 04.06.2004, case number 2002/18702, available on www.unilex.info, accessed on 2006-03-30.114U.S Court ofAppeal, 2nd circuit, Rotorex Corp v. delchi Carrier S.p.A, 06.12.1995, available on www.unilex.info, accessed on 2006-03-30.115Supreme Court of Queensland (Australia), Downs Investments Pty Ltd v Perjawa Steel SDN BHD, Civil Jurisdiction No. 10680 of 1996, 17.11.2000, www.unilex.info (Full Text), available on 2006-04-01.116See http://www.cisg.law.pace.edu/cisg/firstcommittee/Meeting13.html, accessed on 2006-03-30.117Robert Koch, supra footnote 109, at title II.118John O. Honnold in Uniform Law for International Sales under the 1980 United Nations Convention, 3rd edition, (Kluwer Law International 1999) at 208, available on http://www.cisg.law.pace.edu/cisg/biblio/toc.html, accessed on 2006-03-30.119Peter Schlechtriem in Uniform Sales Law - The UN-Convention on Contracts for the International Sale of Goods, Published by Manz, Vienna, 1986 at 60, available on http://www.cisg.law.pace.edu/cisg/biblio/schlechtriem.html#a37, accessed on 2006-03-30.120Supra footnote 105 at 9-19 9-20.121David R. Rivkin, ‘Lex Mercatoria and Force majeure’, in: Gaillard (ed.), Transnational Rules in International Commercial Arbitration (ICC Publ Nr. 480,4), Paris 1993, at 161 et seq., available on www.TLDB.de – DocID 116100, accessed on 2006-03-30.122Articles 1147 and 1148 of the French civil code.123that concept comes from an interpretation by the German Court of Section 275 of the BGB entitled "nicht zu vertretende Unmöglichkeit" (impossibility due to an event for which the obligor is not responsible).124Official Comments of the UNIDROIT on the Principle of Force majeure (article 7.1.1) available on http://www.cisg.law.pace.edu/cisg/principles/uni79.html, accessed on 2006-03-30.125Barry Nicholas ‘Impracticability and Impossibility in the U.N. Convention on Contracts for the International Sale of Goods’, in ‘Galston & Smit’, Ch. 5, 5-1 at 5-11, available on http://www.cisg.law.pace.edu/cisg/biblio/nicholas1.html, accessed on 2006-03-30 ; John Honnold supra footnote 117, at 478.126John Honnold, Ibid.127Barry Nicholas, supra footnote 125 at 5-11.128John Honnold, supra footnote 118 at 478.129Joseph Lookofsky, ‘The 1980 United Nations Convention on Contracts for the International Sale of Goods’, in J. Herbots editor / R. Blanpain general editor International Encyclopaedia of Laws, - Contracts, Suppl. 29, (The Hague Kluwer Law International December 2000) at 161, available on http://www.cisg.law.pace.edu/cisg/biblio/lookofsky.html, accessed on 2006-03-30.130Professor Nicholas, supra footnote 124 refers to Professor Huber and to Professor Schelchtriem (footnotes 22 and 23). With respect to the latter, see Peter Schlechtriem supra footnote 118 at 102, in which he considers that impediment should not mean an ‘occurence that absolutely bars performance’; see also Denis Tallon, ‘Article 79’ in ‘Bianca-Bonell Commentary’ 572 at 576, available on http://www.cisg.law.pace.edu/cisg/biblio/tallon-bb79.html, accessed on 2006-03-30.131Tribunal de Commerce de Besançon (France), case n° 97 009265, 19.01.1998 available on www.unilex.info, accessed on 2006-03-30.132ICC Award No. 3880 1985 YCA, 44 and seq., available on www.TLDB.de – DocID: 203880, (Abstract) accessed on 2006-03-30, in which the seller alleged the force majeure because his late and non-conforming performance was due to the failure of its supplier. The Arbitral Tribunal implicitly admitted that the failure of a third person could have constituted an excuse to its non-performance.133Supra footnote 130.134Bundesgerichtshof [Federal Supreme Court], 24 March 1999, case number VIII ZR 121/98, available on http://cisgw3.law.pace.edu/cases/990324g1.html, accessed on 2006-03-30.135Guide to article 79, comparison between CISG and PECL and comments on article 8:108 PECL, available on http://www.cisg.law.pace.edu/cisg/text/peclcomp79.html, accessed on 2006-03-30.136High Court of Arbitration of the Russian Federation, 16.02.1998, www.unilex.info (Abstract), accessed on 2006-03-30.137case number 56/1995, 24.04.1996, www.unilex.info (Abstract), accessed on 2006-03-30.138ICC, Force Majeure Term, edition 1985 and 2003, available on www.TLDB.de – DocID: 700650 and 700700, (Abstracts), accessed on 2006-03-30.139For instance, the Unido model form of semi-turnkey contract for the construction of a fertilizer plant available on www.TLDB.de – DocID: 700800140Supra footnote 134.141Secretariat Commentary available on http://www.cisg.law.pace.edu/cisg/text/secomm/secomm-79.html, accessed on 2006-03-30.142UNCITRAL yearbook VII of 1976 supra footnote 98 at 130.143Supra footnote 130 at 577.144www.TLDB.de> Principle IV.6.3: the mistake is measured ‘at the moment the contract was concluded’.145Secretariat Commentary, supra footnote 141.146Yearbook of 1974, volume V, (A/C9./87) at 58, available on http://www.uncitral.org/pdf/english/yearbooks/yb-1974-e/yb_1974_e.pdf, accessed on 2006-03-30.147Barry Nicholas, supra footnote 125 at 5-22.148Secretariat Commentary, supra footnote 141.149Denis Tallon, supra footnote 130 at 585.150ICC Court of Arbitration Basel, case number 8128, 1995, available on www.unilex.info (Abstract), accessed on 2006-03-31: the non-delivery by the supplier is part of the seller’s risk. Also Chengwen Liu ‘Force Majeure Perspectives from the CISG, UNIDROIT Principles, PECL and Case Law’ (2nd edition: Case annotated update (April 2005) available on http://www.cisg.law.pace.edu/cisg/biblio/liu6.html#, accessed on 2006-03-31, see commentary in the light of the German decision Bundesgerichtshof [Federal Supreme Court] supra footnote 133. In particular the statement from the Court that from the buyer point of view there was no difference whether the seller produced the goods itself or whether the seller obtained them from a supplier.151Peter Schlechtriem, supra footnote 119 at 104.152Amtsgericht Alsfeld (Germany), case number 31 C 534/94, 12.05.1995, available on www.unilex.info (Abstract), accessed on 2006-03-31: ‘the buyer who has engaged a third person for payment bears the risk that the seller does not receive the payment, when the requirements for exemption from liability set forth in Art. 79 CISG are not met, as in the case at hand.’153ICC Award No. 3880, supra footnote 132: ‘that it is inaccurate to maintain as a general rule that the default of a supplier can never in any circumstances constitute an element in force majeure for a seller of goods. But in this case, B has not proved that its supplier's defaults are of the unforeseeable and irresistible nature required to constitute force majeure’.154Secretariat Commentary, supra footnote 141.155Summary Records of 27th meeting of the First Committee, available on http://www.cisg.law.pace.edu/cisg/firstcommittee/Meeting27.html, accessed on 2006-03-31.156Denis Tallon, supra footnote 130 at 591.157Barry Nicholas, supra footnote 125 at 5-18.158See also the ICC Award No. 7539, 1996 Clunet, 1030 at 1031 available on www.TLDB.de – DocID: 207539 (Abstract), accessed on 2006-03-31: ‘the force majeure event merely constitutes a temporary obstacle (...) the performance of his obligation is suspended until the force majeure event ceases to exist.’159See the Secretaiat Commentary supra footnote 141.160See also the ICC Award No.2478, 1978 YCA, at 223. available on www.TLDB.de – DocID: 202478 (Abstract), accessed on 2006-03-31: In that case the cancellation of an export licence constituted an event of Force majeure but the defaulting party had to pay damages because it did not comply with its duty to inform the other party without delay.161Denis Tallon, supra footnote 130 at 588 and John Honnold, supra footnote 118 at 494.162John Honnold, Ibid.163www.TLDB.de – DocID : 700700 (Abstract), accessed on 2006-03-31.164UNCITRAL Legal Guide on Drawing Up International Contracts for the Construction of Industrial Works, Exemption Clauses No. 1, 12 available on www.TLDB.de – DocID : 790100 (Abstract), accessed on 2006-03-31.165Supra footnotes 163 and 164.166Georges Delaume ‘Law And Practice of Transnational Contracts’ (New York, London, Rome 1988), available on www.TLDB.de – DocID: 101500, accessed on 2006-03-31.167See ICC Award No. 1512, YCA 1976, at 129, available on www.TLDB.de – DocID: 201512 (Abstract), accessed on 2006-03-31; ICC Award No. 4761, supra footnote 86 at 1015; see also TLDB Principle IV.1.2.168Supra footnote 119 at 102.169Supra footnote 155.170Supra footnote 125 at 5.16: ‘The American common law has the merit, by comparison with the common law of England and the Commonwealth, of keeping a clear distinction between impossibility or impracticability of performance and frustration of purpose. Article 79 provides for the former, but not for the latter’.171Cour d'Appel de Colmar, 12.06.2001, France, available on www.unilex.info, accessed on 2006-03-31. Indeed, in French Courts have always denied to readapt a contract in reason of change in circumstances (Arrêt du Canal de Craponne of March 6, 1876).172Landgericht Aachen, case number: 43 O 136/92, 14.05.1993, available on www.unilex.info (Abstract), accessed on 2006-03-31, in which the Court held that 'Wegfall der Geschäftsgrundlage' was a matter exhaustively covered by the CISG.173See ‘Legislative history of CISF article 14: matchup with the 1978 Draft’, available on http://www.cisg.law.pace.edu/cisg/text/matchup/matchup-d-14.html, accessed on 2006-03-31.174See the the Draft Convention on the formation of contract for the international sale of goods – article 4, Yearbook 1977, vol VIII at 89 available on http://www.uncitral.org/pdf/english/yearbooks/yb-1977-e/yb_1977_e.pdf, accessed on 2006-03-31.175Commentary on the Draft Convention on the Formation of Contract for the International Sale of Goods, Yearbook 1976 supra footnote 98 at 93.176Supra footnote 5 at 134 (for Ghana’s position), 143 (for France’s postion). About USSR’s position, see comments on article 36 of the CISG 1976 Draft, Yearbook VIII (1977) supra footnote 174 at 132.177Summary Record of the 8th meeting of the First Committee, paragraph 68, available on http://www.cisg.law.pace.edu/cisg/firstcommittee/Meeting8.html, accessed on 2006-03-31.178For instance, the Uniform Commercial Code article 2-305 provides: ‘The parties if they so intend can conclude a contract for sale even though the price is not settled. In such a case the price is a reasonable price at the time for delivery (...)’179Supra footnote 177, paragraph 82.180Summary Records of the 11th meeting of the First Committee, paragraph 66, available on http://www.cisg.law.pace.edu/cisg/firstcommittee/Meeting11.html, accessed on 2006-03-31.181Some delegates considered that it was not clear whether the second sentence contained essential element of the definition or constituted an example. Thus an ad hoc working group submitted two proposals which a provide a flexible formula, see supra at paragraph 47.182Summary Records of the 24th meeting of the First Committee, paragraph 27, available on http://www.cisg.law.pace.edu/cisg/firstcommittee/Meeting24.html, accessed on 2006-03-31.183Ibid at paragraph 23.184Ibid at paragraph 34.185Ibid at paragraph 32: In the view of the Mexican delegate, article 12 and 51 were complementary, ‘the former sanctioning contracts in which the price was implicitly fixed and the latter providing a means of determining the price.’186E. Allan Farnsworth, ‘Formation of Contract’, in ‘Galston & Smit’, available on http://www.cisg.law.pace.edu/cisg/biblio/farnsworth1.html, accessed on 2006-02-03 at 3-8 and 3-9; Gyula Eörsi, ‘Article 14’ in ‘Bianca-Bonell Commentary’ at 144, available on http://www.cisg.law.pace/edu/cisg.biblio/eorsi-bb14.html, accessed on 2006-03-31.187Secretariat Commentary on article 12 of the 1978 Draft [and that became article 14 CISG], available on http://www.cisg.law.pace.edu/cisg/text/secomm/secomm-14.html, accessed on 2006-03-31.188John O. Honnold supra footnote 118 at 152-155.189Joseph Lookofsky, supra footnote 129, at 64.190Alejandro M. Garro, supra footnote 52, at the subtitle ‘Open-Price Terms’.191Hungary, Supreme Court, 25 September 1992, Pratt & Whitney v. Malev, English version available on http://cisgw3.law.pace.edu/cases/920925h1.html, accessed on 2006-03-31.192Harry M. Flechtner ‘The Several Texts of the CISG in a Decentralized System: Observations on Translations, Reservations and other Challenges to the Uniformity Principle in Article 7(1)’ (Abstract), (1998) 17 Journal of Law and Commerce 187-217, available on http://cisgw3.law.pace.edu/cisg/wais/db/editorial/flechtner920925h1.html, accessed on 2006-03-31.193In an excerpt from ‘Transcript of a Workshop on the Sales Convention: Leading CISG scholars discuss Contract Formation, Validity, Excuse for Hardship, Avoidance, Nachfrist, Contract Interpretation, Parol Evidence, Analogical Application, and much more’, (1999) 18 Journal of Law & Commerce 191-258, transcribed and edited by Harry M. Flechtner, available on http://www.cisg.law.pace.edu/cisg/biblio/workshop-14,55,18.html, accessed on 2006-03-31.194’www.TLDB.de> List of Principles195Filali Osman, supra footnote 27 at 179 : ‘Le droit anational envisage les dommages et intérêts comme un moyen permettant de placer le créancier dans la situation économique qui lui eût procuré l’exécution du contrat’.196Georges Ripert, ‘Les règles du Droit Civil Applicables aux Rapports Internationaux (Contribution à l’Etude des Principes Généraux du Droit visés au Statut de la Cour Permanente de Justice Internationale)’, 44 Rec.Cours 1933-II, at 602, www.TLDB.de – DocID 128400, accessed on 2006-03-31.197ICC Award N°3131,supra footnote 30 at 531: ‘In conformity with the Principle of Good Faith which inspires the international lex mercatoria, the arbitral tribunal has considered whether under the circumstances of the present case, the disturbance of the contract may be attributed to the behavior of one of the party and whether this has caused a damage to the other side the reparation of which is required by equity’.198See Official Comments in ‘Guide to article 74’ available on http://www.cisg.law.pace.edu/cisg/principles/uni74.html, accessed on 2006-03-31.199www.TLDB.de > list of Principles200John Y. Gotanda ‘Recovering Lost Profits in International Disputes’, (2004) 36 GILJ 61 at 111, available on www.TLDB.de – DocID: 123430 (citations only), accessed on 2006-03-31.201ICC Award No. 1526, 1974 Clunet, at 918, available on www.TLDB.de – DocID: 201526 (Abstract), accessed on 2006-03-31.202www.TLDB.de > Principle X.1: ‘If a party is unjustifiably enriched at the expense of another, that party has to pay a sum of money equal to the value of the enrichment to be determined according to the contractually agreed price or market price, including full compensation for the use (usufruct) of the subject matter of the enrichment ("Nemo sine causa alterius jactura locupletari debet"; "condictio indebiti"; "unjust enrichment").’203Secretariat Commentary on article 70 of the 1978 Draft [that became article 74 of CISG], available on http://www.cisg.law.pace.edu/cisg/text/secomm/secomm-74.html, accessed on 2006-03-31.204Handelsgericht Zürich, case number HG920670, 26.04.1995, Switzerland, available on www.unilex.info (Abstract), accessed on 2006-03-31. In that case, damages were awarded for breach of the secondary obligations of transportation and installation of the good.205See for instance Victor Knapp, ‘Article 74’ in ‘Bianca-Bonell Commentary’ at 540, available on http://www.cisg.law.pace.edu/cisg/biblio/knapp-bb74.html, accessed on 2006-03-31; Joseph Lookofsky, supra footnote 129 at 152.206Sieg Eiselen ‘Remarks on the Manner in which the UNIDROIT Principles of International commercial Contracts May be Used to Interpret or Supplement Article 74 of the CISG’, Editorial Remark, October 2004 in ‘Guide to article 74’, supra footnote 196.207Ibid.208Court of Appeal of Grenoble, Sté Calzados Magnanni v. Sarl Shoes General International - S.G.I., case number 96J/00101, 21.10.1999, available on www.unilex.info, accessed on 2006-03-31.209Supra 203.210Supra.211Eric C. Schneider (U.S.), ‘Measuring Damages under the CISG’ in an Editorial Analysis of article 74 CISG, available on http://www.cisg.law.pace.edu/cisg/text/cross/cross-74.html, accessed on 2006-04-01.212U.S. District Court, N.D., New York Delchi Carrier S.p.A. v. Rotorex Corp., case number 88-CV-1078, 09.09.1994, www.unilex.info, accessed on 2006-04-01, and the decision rendered on appeal from which the quotation was taken, supra footnote 114 .213Supra footnote 115.214Arbitral Award, Schiedsgericht der Börse für Landwirtschaftliche Produkte – Wien, P. v. P, case number: S2/97, 10.12.1997, available on www.unilex.info (Abstract. ), accessed on 2006-04-01.215Rechtbank van Koophandel Hasselt, Vital Berry Marketing NV v. Dira-Frost NV, case number AR 1849/94, 02.05.1995, www.unilex.info (Abstract), accessed on 2006-04-01.216Jacob S. Ziegel, supra footnote 105 at 9-38.217Supra.218Denis Tallon ‘Damages, Exemption Clauses, and Penaltie’, (1992) 40 Am.J.Comp.L., at 678, also available on www.TLDB.de – DocID : 129100, accessed on 2006-04-01.219Ibid.220Supra.221See ICC Award 1526, supra footnote 201; ICC Award 2404, 1976 Clunet, at 995-996, available on www.TLDB.de – DocID 202404 (Abstract), accessed on 2006-04-01.222Michael Mustill, supra footnote 15 at 113 : principle 14 provides that ‘[d]amages for breach of contract are limited to the foreseeable consequences of the breach’; ‘Fouchard, Gaillard, Goldman’, supra footnote 23 at 833: ‘some awards have held by way of a general principle, that only direct and foreseeable losses are capable of giving rise to compensation’; Jan Paulsson ‘La Lex Mercatoria dans l’Arbitrage C.C.I.’, 1990 rev.d.Arb. at 93, available on www.TLDB.de – DocID 127800, accessed on 2006-04-01.223See the various Uncitral Reports already mentioned above and the internet link about the legislative history of article 74 CISG available on http://www.cisg.law.pace.edu/cisg/chronology/chrono74.html, accessed on 2006-04-03.224Peter Schlechtriem, supra footnote 118 at 97.225Victor Knapp, supra footnote 203 at 541.226Supra.227Arbitration Institute of the Stockholm Chamber of Commerce, Award number 107/1997,1998, available on www.unilex.info, accessed on 2006-04-03.228Oberlandesgericht Köln (Germany), case number 22 U 4/96, 21.05.1996, www.unilex.info, accessed on 2006-04-03. How to search - Contact - Team - Trustees - Disclaimer / Legal information / Privacy - Twitter - FacebookA project of CENTRAL, University of Cologne.