Source: http://cisgw3.law.pace.edu/cisg/wais/db/cases2/061023g1.html
Timestamp: 2020-08-09 05:19:07
Document Index: 725429557

Matched Legal Cases: ['Art. 67', 'Art. 49', 'art;\n5', 'Art. 2', 'Art. 6', 'Art. 62', 'Art. 53', 'Art. 39', 'Art. 39', 'Art. 49', 'Art. 50', 'Art. 67', 'Art. 31', 'Art. 67', 'Art. 4', 'Art. 28', 'Art. 1243', 'Art. 1243', 'Art. 1252', 'Art. 2', 'Art. 5', 'Art. 31', 'Art. 78', 'Art. 78', 'Art. 9', 'Art. 32', 'Art. 32', 'Art. 1284']

Germany 23 October 2006 District Court Bamberg (Plants case) [translation available]
[Cite as: http://cisgw3.law.pace.edu/cases/061023g1.html]
DATE OF DECISION: 20061023 (23 October 2006)
CASE NUMBER/DOCKET NUMBER: 2 O 51/02
Reproduced from Internationales Handelsrecht (3/2007) 113
"1. If a multitude of the same type of goods is sold, a notice which indicates that all specimens are defective may be a sufficient notice of non-conformity: it is not necessary that the defect of each specimen is notified individually.
"2. The notice of non-conformity is to enable the seller to form an idea of the non-conformity to then take the necessary steps. Any ambiguities or doubts as to the type or extent of the non-conformity mentioned in the notice are to be clarified with the buyer by the seller.
"3. The handing over of the goods in the sense of Art. 67(1) CISG is only completed upon conclusion of the loading."
Key CISG provisions at issue: Articles 4 ; 6 ; 38 ; 39 ; 49 ; 50 ; 67(1) ; 78 [Also cited: Articles 2 ; 3(1) ; 9 ; 31 ; 53 ; 62 ]
6B (Choice of law (agreements to apply Convention): pleading German domestic law not a waiver of CISG];
49B1 [Buyer's right to avoid contract (buyer's loss of right to declare avoidance after delivery): failure to avoid within periods specified in Art. 49(2)];
50A ; 50B [Buyer's right to reduce price for non-conforming goods; This right available whether or not price has been paid];
Descriptors: Scope of Convention ; Set-off ; Choice of law ; Passage of risk ; Examination of goods ; Lack of conformity notice, timeliness ; Lack of conformity notice, specificity ; Avoidance ; Reduction of price, remedy of ; Interest
Original language (German): CISG-online.ch website <http://www.cisg-online.ch/cisg/urteile/1400.pdf>; Internationales Handelsrecht (3/2007) 113-117
23 October 2006 [2 O 51/02]
1) Defendant [Buyer] is ordered to pay Plaintiff [Seller] �1,588.10 plus 3.5% interest for the period from 23 April 2001 until 31 December 2001, 3% interest for the period from 1 January 2002 until 31 December 2003, and 2.5% interest from 1 January 2004. The remainder of [Buyer's] claim is dismissed.
2) [Seller] bears 84 % of the costs of the proceedings while [Buyer] bears 16 %.
3) The judgment is preliminarily enforceable. However, [Seller] may do so only against a security deposit of 110 % of the sum which it attempts to enforce. With regards to legal costs and expenses, [Seller] can avert enforcement by [Buyer] by filing a security deposit of 110 % of the sum in question, if [Buyer] does not furnish security in the same amount before enforcement.
The security deposit may also be effected through written, irrevocable and unconditional bail from a public savings bank or a bank that is accredited as a guarantor for customs and taxes and located within the European Community.
The parties are in dispute concerning claims based on non-conformity following from their international sales contract.
[Seller] has a tree nursery in Italy. [Buyer], who runs a tree nursery in Germany, ordered plants from [Seller] by fax dated 12 March 2001. The order had the following content (excerpt):
"Straight stems, drawn through the terminals:
Delivery in calendar week 12
- 50 Aesculus carnea Briottii 8/10 40,-
- 25 Ailanthus altissima 12/14 40,-
- 100 Catalpa bigno. Nana 10/12 25,-
- 50 Ginko Biloba 10/12 40,-
- 200 Juglans regia 8/10 15,-
- 25 Liquidambar styracifula 10/12 40,-
- 100 Robinia umbriculifera 10/12 25,-
- 100 Sophora japonica 10/12 20,-
Delivery free of charge."
[Seller] prepared these plants and loaded them onto the truck of a shipper that [Buyer] had engaged for delivery. The shipper delivered the plants to the [Buyer] on 23 March 2001 and charged [Seller] �1,000 for transport. At the time of delivery, the Sophora japonica had no main sprouts. Upon delivery the [Buyer]'s CEO wrote a handwritten reservation onto the bill of delivery issued on 22 March 2001 and by letter dated 26 March 2001, [Buyer] notified [Seller] of the defects in the plants. This letter had the following content (excerpt):
"Your delivery of 23 March 2001.
Specification of lack of conformity During unloading we identified the following defects:
1) Robinia umbraculifera: broken crowns, in some respects so damaged that no crowns exist anymore;
2) Sophora japonica: no main sprouts;
3) Juglans regia: the stem circumference measures 6 cm at the maximum. There are no side branches. These are seedling shoots, partially twisted;
4) Ginko biloba: these plants were loaded at the bottom of the truck. Parts of their terminals have broken apart;
5) Catalpa Nana: see no. 1;
6) Ailanthus altissima: main sprouts are broken apart -- chipped bark at the stems;
7) Aesculus Briottii: bark tearing at the stems, affected by red pustules.
As discussed, we will clarify these problems in discussions in the summer at your place in Italy."
With an invoice dated 22 March 2001 [Seller] billed [Buyer] for the delivery in the amount of �8,263.31. By letter dated 20 June 2001, [Seller] reminded that payment was due. The invoice of 22 March 2001 had the following content (excerpt):
"Aesculus Carnea Briottii 8/10 50 pieces, each Italian lira [LIT] [*] 40,000: total LIT 2,000,000.
Ailanthus altissima 12/14 25 pieces, each LIT 40,000: total LIT 1,000,000.
Catalpa bigno Nana 10/12 100 pieces, each LIT 25,000: total LIT 2,500,000.
Ginko biloba 10/12 50 pieces, each LIT 40,000: total LIT 2,000,000.
Juglans regia 8/10 200 pieces, each LIT 15,000: total LIT 3,000,000.
Liquedenbar styracifula 10/12 25 pieces, each LIT 40,000: total LIT 1,000,000.
Robinia Ps. unbraculifera 10/12 100 pieces, each LIT 25,000: total LIT 2,500,000.
Sophora japonica 10/12 100 pieces, each LIT 20,000: total LIT 2,000,000.
Total LIT 16,000,000 = �8,263.31."
[Seller] alleges that the plants were delivered in conformity with the contract. As had been agreed, the Saphora japonica were only two years old and their main sprout would not emerge until later. The goods were neither defective nor damaged. Any possible defects were caused by inappropriate transport, which, however, was entirely in the [Buyer's] sphere of responsibility. At the time of loading of the plants, they were all in proper condition. [Seller] had paid utmost attention to careful loading of the plants, because [Buyer] had only provided a loading space of 6 m instead of 8 m, as had been promised. This was because the truck (total loading space 13.6 m) had already been loaded with ten pallets of bagged cargo. As a result, the CEO of [Seller] informed [Buyer] that it would load fewer plants in order to prevent any possible damage during transport. [Buyer] nevertheless wanted all ordered plants to be delivered with that truck. [Seller]'s employees therefore loaded the plants around the pallets. It could also not be ruled out that damages occurred during unloading or through a lack of care by [Buyer]. Before unloading of the plants at [Buyer]'s place, the pallets under the plants had been unloaded in Burgebrach, which meant that the plants had to be moved quite extensively. Finally, [Buyer] had not sufficiently specified the alleged lack of conformity in its written notice. Particularly, the number of damaged pieces of each type of plant was not mentioned at all.
[Seller] requests the Court to order [Buyer] to pay [Seller] �8,263.31 plus interest at 5% above the prime lending rate from 23 April 2001.
[Buyer] requests the Court to dismiss the [Seller]'s action.
[Buyer] alleges that [Seller] had expressly promised the delivery of best quality at the time the plants had been ordered. However, the goods were defective or damaged at the time of delivery. All Aesculus carnea "Briottii" showed injuries at their roots and stem area and were affected by red pustules. [Seller] had not delivered plants with the requested tall stems (8/10). All Ailanthus altissima suffered from broken main sprouts and bark damage. The crowns of all Catalpa bignonioides "Nana" were broken at the time of delivery. The plants of Ginkgo biloba were positioned at the very bottom of the truck's loading space, which caused broken terminals for 25 of them. Additionally, the plants had grown twisted rather than straight. None of the Juglans regia and Sophora japonica were of the requested "tall and straight stems, drawn through the terminals". Instead, [Seller] had delivered one-year old seedling shoots which did not have any measurable stem circumference. Moreover, the plants had not been transplanted twice, had no typical crown shape and no side branches. All Liquidambar styracifular had not grown due to a lack of roots. The poor quality of the roots was only discovered on 29 March 2001 when the goods were planted since at delivery the roots were covered with ground sacks. All Robinia pseudoaccacia "Umbraculifera" lacked their main sprout. The crowns had broken apart and some were damaged in a way that no crown existed anymore. The damages were caused by poor preparation for transport and inappropriate loading. The goods should not have been packed into jute bags.
The damages in question were not caused during transport or during unloading. Rather, the damages were in existence at the time of loading at [Seller]'s tree nursery or occurred at that stage. [Buyer] has no other use for the defective plants. Therefore, [Buyer] claims avoidance or a price reduction to zero. It could not have been expected of [Buyer] to give a specific notice of non-conformity for each single plant. [Buyer]'s notice was sufficient to enable [Seller] to examine the defects. Even if a loading space of only 6 m should have been provided, the goods should not have been allowed to be squeezed into the small loading space. It was [Seller's] duty to load the truck with fewer plants in order to prevent any damage to the plants.
[Buyer] further relies on a set-off claim for transport costs of �1,000. There was an agreement by telephone with [Seller]'s secretary prior to delivery that [Seller] would assume �1,000 of the transport costs.
The Court has taken evidence by hearing witnesses. In that respect, reference is made to the session protocols of 7 February 2005 and 2 October 2006. Furthermore, the Court has requested a written expert opinion, which the expert has orally explained. The Court refers to the written expert opinion of 18 October 2004. Concerning all further details, the Court refers to the memoranda exchanged and the protocols of 28 October 2002, 18 October 2004, 7 February 2005, 19 December 2005 and 2 October 2006.
The [Seller]'s action is admissible and partially justified.
The action is admissible. In particular, German courts have international jurisdiction because [Buyer] as the defendant is domiciled within the local district (Art. 2(1) Council Regulation (EC) No. 44/2001 of 22 December 2000 on Jurisdiction and the Recognition and Enforcement of Judgments in Civil and Commercial Matters; Brussels I Regulation).
II. [Justification for the action]
However, the [Seller]'s action is justified only to a small extent. [Seller] is entitled to payment from [Buyer] only in the amount of �588.10.
The legal relations between the parties are governed by the United Nations Convention on Contracts for the International Sale of Goods of 11 April 1980 (CISG). The CISG entered into force in Italy on 1 January 1988 and in Germany on 1 January 1991. Both parties have their places of business in a Contracting State and the goods in question are not bought for personal use (Arts. 1(1)(a), 2, 3(1) CISG). This does not conflict with the fact that the parties have argued merely with reference to provisions of German law in their memoranda, since such practice does not in itself lead to an implied waiver of the CISG under Art. 6 CISG (Piltz, NJW [*] 1996, 2770; BGH [*] NJW 1999, 1259).
2. [Seller's claim for the purchase price]
[Seller] is entitled to payment for delivered goods pursuant to Art. 62 CISG in the amount of �1,588.10.
a) [Conclusion of sales contract]
On 12 March 2001, the parties concluded a contract for the sale of various plants at a price of LIT 16,000,000 (= �8,263.31). According to Art. 53 CISG, [Buyer] is obliged to pay the purchase price and to take delivery of the goods.
b) [Lack of conformity; notification of lack of conformity]
However, [Buyer] can properly rely on a lack of conformity of the delivered goods with respect to most of the alleged defects in the present case. Contrary to [Seller]'s view, [Buyer] has complied with its duty under Art. 39(1) CISG to give proper and timely notice of non-conformity. The written notice of non-conformity of 26 March 2001 is sufficient. The nature of the lack of conformity is precisely specified. It is readily comprehensible from the content of the notice that all plants were affected by the described defects. [Buyer] had no duty to specify defects with respect to every single plant. The requirements regarding the content of notice may not be exaggerated in this respect. The notice requirement serves to enable the seller to form an idea of the lack of conformity in order for him to take any necessary steps (BGH WM [*] 2000, 481). Should any lack of clarity remain for the seller concerning the nature or extent of the non-conformity after a notice has been submitted, the seller can be expected to inquire of the buyer.
However, insofar as [Buyer] claims further defects in the present proceedings that were not already contained in the written notice, these cannot be heard. Notice of non-conformity must be given in the applicable time period of not more than one month after delivery (cf. BGH NJW 1995, 2099). Since notice of the following defects: Aesculus carnea "Briottii": missing tall stems (8/10); twisted growth of Ginkgo biloba; lack of double transplantation of Juglans regia; no main sprouts of Robinia pseudoaccacia "Umbraculifera" was not timely given according to Art. 39 CISG, these defects cannot be claimed. With reference to Liquidambar styracifular, no notice of non-conformity was given at all until the present proceedings. [Buyer] may not excuse itself from its failure to give immediate notice by relying on the assertion that the defect could not have been discovered because the plants were delivered in bags. Irrespective of the duty to inspect the goods immediately after delivery, [Buyer] itself stated that a poor quality of the roots had been discovered during implantation on 29 March 2001. [Buyer] had the duty to give a corresponding notice within one month. Since this undisputedly did not occur, [Buyer] may not rely on a lack of conformity and is excluded from its remedies in this respect.
c) [No avoidance of contract]
[Buyer] has not exercised the right to avoid the contract within the time required by Art. 49(2)(a) CISG. It is undisputed that avoidance of the contract was not declared until the submission of [Buyer]'s procedural response. At that point, the reasonable time period for declaration of avoidance had long since lapsed.
d) [Price reductions in favor of Buyer]
However, [Seller]'s claim for the purchase price is to be reduced under Art. 50 CISG because [Buyer] exercised its right of a reduction in price. According to this provision, a purchase price may be reduced if the goods do not conform to the contract, irrespective of whether or not payment has already been effected.
The defects complained of by [Buyer] constitute instances of non-conformity to the contract: According to the findings of the appointed expert, about three-fourths of the Aesculus carnea "Briottii" (red-blooming buckeye) suffer from damage at their roots and stems. A substantial part of the plants have already died. Furthermore, the witnesses have credibly uniformly stated that the buckeye trees were affected by red pustules at the time of unloading. Following the comprehensible and convincing statements of the expert, the main sprouts of all Ailanthus altissima (trees of heaven) had broken apart. Two out of three of them suffered bark damage at the lower and middle part of the stems. Furthermore, the sprout tips within the crowns of all Catalpa bignonioides "Nana" (Indian bean) had broken apart. Even some main branches were broken. Several of these plants have meanwhile died. It is also true that the terminal sprouts of almost all Ginkgo biloba (Ginkgo) had broken. The expert stated that the Juglans regia (walnut tree) were not evenly thick at the top and at the bottom. Instead, the stems become thinner from the bottom to the top. The trees feature a stem circumference between 6 and 9 cm, at an average of 7 to 8 cm. Because three seasons have passed from the time of delivery to the time of inspection by the expert, the stem circumference could not possibly have complied with the proportion ordered of between 8 and 10 cm. Moreover, the trees' quality is poor because they lack a developed crown onset, which is a particular characteristic of high-stem trees. The side branches have partially emerged at the bottom of the stem and stretch up to the top. Therefore, the delivered trees are plants with relatively little growth of the side branches. Only one of the Robinia pseudoaccacia "Umbraculifera" (black locust) suffers a complete tearing of the crown. The others suffer from cuts and truncated branches. The crowns are therefore partially one-sided or no longer as full as they should be and more or less deformed. Finally, the Sophora japonica (Japanese string-trees) have grown insufficiently. Most of them are twisted and crooked. Moreover, they do not feature any clear crown onset. Their terminals, as far as they exist, are mostly twisted. The crowns are quite narrow. The plants are rather like shoots than trees.
Since [Buyer] timely complied with its duty to give notice with regard to the defects mentioned above, the burden would be on [Seller] to substantiate that the delivered goods were in conformity with the contract at the time of passing of risk (Schlechtriem/Schwenzer, Kommentar zum einheitlichen UN-Kaufrecht CISG [Commentary on the CISG], 4th ed., Art. 67 para. 11). [Seller] did not do so. In the absence of a contrasting contract provision, here a sale for delivery of goods in terms of Art. 31(a) CISG is to be presumed, since the sales contract required the delivery of the goods. [Seller] fulfilled its obligation to deliver the goods by handing them over to the carrier procured by [Buyer]. This is not overruled by the contract term which provided for delivery "free of charge." According to the general rule of Art. 67(1) CISG, for sales requiring delivery, the risk passes to the buyer when the goods are handed over to the carrier. "Handing over" requires that the carrier take custody of the goods, which implies an actual surrender of the goods to the carrier. In this respect, it is no doubt necessary for the seller to load the goods onto or into the respective means of transport. Thus, the risk only passes when loading is completed. According to the expert opinion, the quality of the delivered goods is significantly below average. These quality defects have not been caused by poor care on the part of [Seller]'s employees, but instead by poor cultivation of the plants. Furthermore, the evident local damages that the plants suffered (bark damage, broken sprouts and crowns as documented by the expert) were not caused by nature. Taking into account their shape and appearance, the damage was caused by improper storage within the transport vehicle. Apparently, the damaged plants were stored below other plants (bale cargo). Whenever the transport vehicle moved during its journey, the bales must have grinded against the plants. The transport itself was not critical to the occurrence of the damage but the way the plants were loaded before transport. As the same type of plant damage appeared frequently in the case at hand, it must be assumed that there had been some general improper conduct occurred during the loading of the plants into the transport vehicle. The damage might in theory also have occurred during unloading. Yet, it is hardly imaginable that the same damage would have appeared so frequently. The witnesses have convincingly and uniformly stated that the damage was discovered during unloading and that it was not caused by their careful unloading by hand. One witness credibly stated that he could not remember having unloaded any goods prior to the unloading at [Buyer]'s place of business in Burgebrach. In any event, he knew that the canvas cover was properly closed at the time of arrival at [Buyer]'s location. Even the customs sign was still attached. He further stated that any unloading by opening the side walls and pulling out any bale cargo was practically impossible. Consequently, no damage to the plants could have occurred by a different unloading process after the passing of risk to [Buyer].
The witness introduced by [Seller] was supposed to prove that the goods had been in proper condition at the time of passing of risk and that [Buyer] was responsible for inappropriate loading because it had provided an improper transport vehicle. However, the witness was not heard because he was unavailable. A medical certificate issued in Italy indicates travel sickness as the excuse for his absence. A provisional hearing of this witness seems inappropriate to the Court. Following the factual argument brought by [Seller], which contradicts the expert opinion, it would be critical to receive a personal impression of this witness. As the Court has attempted several times and over a long period of time to arrange for attendance of the witness, the Court must presume he will not appear and consider him unavailable as located in a foreign country (Zöller, ZPO [*], 25th ed., Vor � 284, para. 11a). Moreover, [Seller] has failed to pay the required �200 advance for expenses within the required time, which is necessary for foreign service in judicial assistance matters.
On the grounds of the expert's statements concerning the appropriate price reductions, [Seller]'s claim amounts to only �1,588.10. The Aesculus carnea "Briottii" (red-blooming buckeye) formed a total loss because the plant substance cannot be exploited due to their damage. The corresponding purchase price of LIT 2,000,000 (= �1,032.91) is subject to a full reduction. According to the explanations of the expert, a reduction of 60% should be applied to the price of Ailanthus altissima (tree of heaven). Therefore, [Buyer] needs only to pay �206.58 of the initial price of LIT 1,000,000 (�516.46). The Catalpa bignonioides "Nana" (Indian bean) were another total loss. Their plant substance cannot be used anymore because the crowns are completely deformed. The purchase price is to be reduced by LIT 2,500,000 (�1,291.14). The Ginkgo biloba (Ginkgo) also constitute a total loss since their broken terminals do not allow for further growth. The purchase price is therefore to be reduced for the entire amount of LIT 2,000,000 (�1,032.91). Additionally, the Juglans regia (walnut trees) were a total loss, since they are unmerchantable. Their deformed habitus prevents growth in a way that the trees could ever become merchantable. A price reduction of LIT 3,000,000 (�1,549.37) applies. Some of the delivered Robinia pseudoaccacia "Umbraculifera" (black locusts) will be able to grow properly after some supporting efforts. There is also decent demand for this plant type on the market, meaning that the delivery as a whole is not economically worthless. The reduction of 33% as proposed by the expert seems appropriate. The initial price of LIT 2,500,000 (�1,291.14) is therefore reduced to �865.06. Finally, the Sophora japonica were another total loss. Their deformed habitus does not allow for any future merchantability. It is not expected that their twisted sprouts will become straight once again, allowing for proper growth. Their purchase price is put to another full reduction of LIT 2,000,000 (�1,032.91). The Liquidambar styracifular are not subject to a reduction for legal reasons set out above. Their purchase price of LIT 1,000,000 (�516.46) is to be paid in full.
3. [No set-off in favor of Buyer]
[Seller]'s claim for the remaining reduced purchased price of �1,588.10 is not affected by any set-off in favor of [Buyer].
a) [Requirement of international jurisdiction]
A decision by the Court concerning a set-off requires international jurisdiction to consider the set-off claim.
In the case at hand, the admissibility of a set-off must be determined under Italian law. Since the CISG does not contain definite rules for set-offs, any set-off must be determined pursuant to the substantive law that applies according to conflict of laws rules (Schlechtriem/Schwenzer, Kommentar zum einheitlichen UN-Kaufrecht CISG [Commentary on the CISG, 4th ed., Art. 4 para. 39). It must be geared to the law which applies under conflict of laws rules to govern the sales contract between the parties. Insofar, Italian law is to be considered according to Art. 28(2) EGBGB [*]. The parties did not make a choice of law. Consequently, the contract is governed by the law of the country with which it is most closely connected. It is presumed that the closest connection exists with the country where the party who is to effect the characteristic performance had its usual residence or central administration at the time of conclusion of the contract. The characteristic performance at hand is the delivery of the plants. This was [Seller]'s obligation. It has its place of business in Italy, meaning that Italian law applies. This is also corroborated by the fact that prices have been fixed in Italian currency (LIT). Italian law knows three possible types of set-offs: The "compensazione legale" (statutory set-off) according to Art. 1243(1) Codice civile [*], the "compensazione giudiziale" (judicial set-off) pursuant to Art. 1243(2) Codice civile, and the "compensazione volontaria" (amicable set-off) under Art. 1252 Codice civile.
Whether or not [Seller]'s claim is subject to a set-off depends mainly on the existence and amount of the set-off claim and on whether [Buyer] is entitled to the claim. All of these issues concerning set-off claims are decided by the Court with legal effect, � 322(2) ZPO [*]. As a result, a German court may adjudicate the set-off claim only if international jurisdiction is present (BGH [*] NJW [*] 1993, 2753).
b) [No international jurisdiction of the Court concerning Buyer's set-off claim]
However, the present Court has no international jurisdiction to consider the claim for payment of transport costs raised by [Buyer] in the context of the sales contract with [Seller]. Under Art. 2(1) Brussels I Regulation, [Seller] would have had to be sued in Italy where it is domiciled in that Member State. The jurisdiction of Italian courts is also supported by Art. 5(1)(b) Brussels I Regulation. Pursuant to this provision, the place where the goods were delivered according to the contract or should have been delivered under the contract governs all claims arising out of the contract. In cases of sales which involve carriage of the goods, according to the CISG, the seller's place of business (here: in Italy) forms the place where the characteristic performance is effected (Art. 31 CISG).
1. [Seller's claim for interest]
[Seller] is entitled to interest on the awarded sum since 23 April 2001 according to Art. 78 CISG. Art. 78 CISG gives the seller the right to claim interest on outstanding claims without any further requirement. Interest is to be paid from the time of maturity of the principal claim. The buyer need not even be in default. However, the Court was not allowed to increase the time for interest from the point which [Seller] claimed (� 308 ZPO [*]). The CISG itself only governs interest claims on their merits but is silent concerning particular interest rates. If the parties to a sales contract governed by the CISG have not themselves agreed on a certain interest rate and if -- as in the case at hand -- no relevant trade usage applies under Art. 9 CISG, interest rates are governed by the complementary domestic law. Art. 32(1)(3) EGBGB [*] provides that the law applicable to the contract further applies to contractual remedies, including the quantification of damages. This also refers to the prerequisites and consequences of default by the debtor (Palandt, BGB [*] [BGB Commentary], 65th ed., Art. 32 EGBGB, para. 5). Between 1 January 2001 and 31 December 2001, the Italian statutory interest rate was at 3.5% (Regulation by the Treasury Secretary of 11 December 2000). Between 1 January 2002 and 31 December 2003 the interest rate was at 3% (Regulation by the Treasury Secretary of 11 December 2001) and, since 1 January 2004, the rate was at 2.5% (Regulation by the Treasury Secretary of 1 December 2003) (Art. 1284(1)(2) Codice civile. [Seller]'s claim for higher interest rates is to be disregarded.
2. [Costs]
The decision on costs is based on �� 91, 92(1) ZPO [*]. The proportion of [Seller]'s overall claim including ancillary claims which has been disregarded by the Court amounts to 84%. Therefore, the corresponding quota is used.
3. [Preliminary enforceability]
The decision concerning preliminary enforceability follows from �� 708 No. 11, 709, 711, 108 ZPO.
* All translations should be verified by cross-checking against the original text. For purposes of this translation, Plaintiff of Italy is referred to as [Seller] and Defendant of Germany is referred to as [Buyer]. Amounts in the uniform European currency (Euro) are indicated as [�]. Amounts in the former currency of Italy (Italian lira) are indicated as [LIT].
Translator's note on other abbreviations: BGB = Bürgerliches Gesetzbuch [German Civil Code]; BGH = Bundesgerichtshof [German Federal Supreme Court]; Codice civile = [Italian Civil Code]; EGBGB = Einführungsgesetz zum Bürgerlichen Gesetzbuche [German Code on Private International Law]; NJW = Neue Juristische Wochenschrift [a German law journal]; WM = Wertpapiermitteilungen [German law journal]; ZPO = Zivilprozessordnung [German Code of Civil Procedure].