Source: http://www.jus.uio.no/sisu/remedies_for_non_performance_perspectives_from_cisg_upicc_and_pecl.chengwei_liu/20.3.html
Timestamp: 2013-05-24 18:00:53
Document Index: 286095081

Matched Legal Cases: ['Art. 79', 'Art. 7', 'Art. 8', 'Art. 79', 'Art. 79', 'Art. 51', 'Art. 79', 'Art. 74', 'Art. 79', 'Art. 79', 'Art. 79', 'Art. 79', 'Art. 74', 'Art. 79', 'Art. 7', 'Art. 8', 'Art. 79', 'Art. 79', 'Art. 79', 'Art. 79', '§ 2', 'Art. 79', 'Art. 79', 'Art. 79', 'Art. 79', 'Art. 7', 'Art. 79', 'Art. 79', 'Art. 8', 'Art. 7', 'Art. 79', 'Art. 7', 'Art. 8', 'Art. 6', 'Art. 7', 'Art. 3', 'Art. 4']

20.3.1 Scope of Excusable Non-performance 20.3.2 Existence of Qualifying Impediment 20.3.2.1 Introduction of a new word 20.3.2.2 Interpretation of the word 20.3.2.3 Problematic situations 20.3.3 Conditions for Exempting Impediment 20.3.3.1 Beyond control 20.3.3.2 Unforeseeable 20.3.3.3 Unavoidable or insurmountable 20.3.3.4 Causation 1253
Paras. (1) of the three texts, namely Art. 79(1) CISG, Art. 7.1.7(1) UPICC and Art. 8:108(1) PECL, set out the conditions under which a party is not liable for a non-performance or his failure to perform any of his obligations. The expression "failure to perform" does not specify the nature of the non-performance. Thus, the scope of this expression has to be analyzed first.
In this respect, one of the controversial issues is whether the texts may apply, especially under the CISG when the seller delivers defectivegoods as opposed to a situation of non-delivery or late delivery: "The possibilities of exemption in the case of non-conformity are unusual for the common law, so that differences of opinion become visible where interpretation is concerned. The CISG uses the notion 'impediments' [...] and no longer mentions 'circumstances' as in Article 74 ULIS, the discussion of which had been controversial already at that time. Honnold [...] has tried to assess this fact in such a way as to explain that this modification was to exclude exemption in the event of non-conformity. This is doubted even by other common law representatives [...], and this has been rightly contradicted by others [...]. The clear wording of the introductory part of the article cannot be changed by pretending that an impediment could not cause non-conformity [...]. But we, too, are of the opinion that these differences of opinion are of little practical weight, because impediments as defined in Article 79, paragraph 1 will seldom be the cause of non-conformity [...]" 1108 Anyway, according to the English text itself, excuse may be brought up by a party for failing to perform "any of his obligations", and conformity of the goods is unquestionably an obligation of the seller. Therefore, the obligation to deliver conforming goods also comes within the scope of Art. 79.
Also, Art. 79 does not provide for the situation where only part of the performance is prevented. It refers to a failure of any obligation, but does not lay down the consequences of the non-performance of the contract as a whole. Honnold notes that the language of the provision permits exemption to the extent that the impediment applies. This can be supported by Art. 51(1) allowing remedies to apply in respect of partial breach. The promisee's rights to other remedies would not be impaired. 1109 The PECL also conceives partial impediment when discussing the consequences of force majeure: "It is primarily in the case of a partial impediment, when a divisible part of the main obligation or a secondary obligation becomes impossible, that the creditor has a real choice; it must be permitted to decide whether or not to maintain the contract according to whether partial performance will be of any value to it." 1110 1257
In short, the term "failure to perform" must be considered here in the broadest sense of the word. With regard to excusable non-performance, apart from late performance and non-performance (at all) it includes, in particular, non-conforming performance and partial performance. Accordingly, the excused non-performance may be total or partial, delayed or defective and relates to the obligations of both parties.
As mentioned above, the CISG Art. 79 uses the notion "impediments" and no longer mentions "circumstances" as in Art. 74 ULIS. Thus, for an exemption to be granted, the non-performance of the contract must be due to an "impediment". The word "impediment" is all that emerged in the end from a lengthy attempt to escape from the elasticity and imprecision of the ULIS requirement that non-performance be "due to circumstances . . ." and to formulate some more certain and objective criterion. 1111 1261
By adopting the word "impediment" the Vienna Conference's aim was at emphasizing the objective nature of the hindrance rather than its personal aspect. 1112 The CISG drafters chose the term "impediment" to denote an objective, outside force that interferes with performance. It is important to stress that the Convention has developed a concept of its own in regard to impediments, which cannot be directly traced back to any national law. This saves from borrowing from a domestic law in interpretation, which could be very misleading, especially when it comes to one's own domestic law. 1113 Both the UNIDROIT Principles and the PECL follow the CISG approach in using the same term "impediment".
This wording, however, is very general and the actual meaning of the term "impediment" is unclear. None of the three texts specify the meaning of "impediment". This causes problems in determining the scope of the exemption. Presumably it covers physical impediments (notably destruction of specific goods under a contract for the sale of specific goods) and legal impediments such as the outbreak of hostilities or the imposition of foreign exchange controls. 1114 1263
In interpreting the concept of "impediment" we should, in the words of Honnold, "purge our minds of presuppositions derived from domestic traditions and, with innocent eyes, read the language of Article 79 in the light of the practices and needs of international trade." Furthermore, performance has to be prevented by the impediment. 1115 According to Stoll, who sees Honnold's definition of impediment as too narrow, the term refers to events external to the party in breach which may be "natural, social, or political events or physical or legal difficulties." Purely personal circumstances, such as personal inadequacy or a mistake of law could not amount to an impediment within the meaning of Art. 79. 1116 1265
Among other things, impediments within the scope of CISG Art. 79 should include: Acts of God (e.g. earthquake, lightning, flood, fire, storm, crop failure, etc.); events relating to social and/or political circumstances (e.g. war, revolution, riot, coup, strike, etc.); legal impediments (e.g. seizure of the goods, embargo, prohibition of the transfer of foreign funds, the prohibition or restriction of foreign imports and/or exports, etc.); and other types of impediments (e.g. loss of the carrying vessel, theft, robbery or sabotage during storage or carriage, general strike, general power supply cut). The occurrence of any of the aforesaid events may (1) destroy the seller's premises or factory, (2) prevent the seller, the carrier, or the warehouse operator from delivering the goods to the buyer or his agent, (3) cause damage to or total or partial loss of the goods, or (4) prevent the buyer from paying the price. It is to be stressed that, events within the promisor's personal sphere of responsibilities and risks shall not be considered impediments for purposes of CISG Art. 79. Accordingly, business failures, personal incapability, liquidation or bankruptcy, failure of production or accounting systems, failure of data processing equipment, failure to maintain the necessary personnel,illness, death or arrest of the promisor, incapability of the promisor's supplier to provide him with raw material, strike constituting internal confrontation at a factory (a general strike, however, shall constitute an impediment), or excessive increase in the price of the raw material should not discharge the promisor from his obligation to perform. 1117 1266
It is important to mention, however, that such events shall not per se constitute impediments for the purposes of CISG Art. 79 or the other two texts, since the characterization of an event as an impediment will depend upon the circumstances of each individual case. It must be characterized as beyond control, unforesseable and unavoidable or insurmountable. Furthermore, the existence of a qualifying impediment to non-performance does not "frustrate" or automatically terminate the contract. The contract apparently continues to exist unless and until it is avoided. The only immediate effect is to excuse the non-performing party from certain liability for failure to perform.
Generally speaking, the term "impediment" may cover every sort of event (natural occurrences, restraints of princes, acts of third parties). 1118 However, there are some particular situations where controversies exist:
(a) Financial embarrassment
One of the controversial points in the preliminary UNCITRAL discussions was whether economic difficulties - "unaffordability" - constitute a ground for exemption. In the view of Schlechtriem, the general view in the end was probably that both physical and economic impossibility could exempt an obligor. It cannot be concluded, therefore, on the basis of the change in terminology from "circumstances" in ULIS Art. 74(1) to "impediments" that an impediment in the sense of Art. 79(1) of the Convention is only an occurrence that absolutely bars performance, but - under very narrow conditions - impediment also includes "unaffordability". As a rule, however, since the obligor generally guarantees his financial capability to procure and produce the promised goods, increased procurement and production costs do not constitute exempting impediments. 1119 1271
Perillo seems to deal with this situation in a stricter manner when studying Art. 7.1.7 UPICC: "Neither Article 7.1.7 nor the commentary to it refers to this kind of impediment. Under American law, it is quite clear that financial impediments provide no excuse; these are regarded as 'subjective' rather than 'objective' impossibility and there is unanimity in the case law and in doctrine that subjective impossibility provides no excuse, whether or not it was the result of conditions outside the control of the obligor. It is generally believed that the risk of financial ability to perform is such a basic assumption underlying all contracts that it cannot be excused, except by a decree in a bankruptcy proceeding. It is hard to believe that this general belief is suspended in international trade. Consequently, the phrase 'beyond [the party's] control' should be given a broad meaning so that it will be deemed that financial health is always within a contracting party's control." 1120 1272
One should note, however, although it is probably true that the insolvency of the buyer by itself is not an impediment which exempts the buyer from liability for non-payment of the price, the unanticipated imposition of exchange controls, or other regulations of a similar nature may make it impossible for him to fulfill his obligation to pay the price at the time and in the manner agreed. 1121 The Official Comment to Art. 8:108 PECL also confirms: "While insolvency would not normally be an impediment within the meaning of the text, as it is not 'beyond the control' of the debtor, a government ban on transferring the sum due might be." 1122 1273
(b) Frustration of purpose
Also, it is not clear to what extent "impediment" may embrace frustration of the purpose of the contract. The CISG drafters chose the term "impediment" to denote an objective, outside force that interferes with performance. According to Honnold, Art. 79 includes a causation element -- the impediment must actually prevent performance. Other commentators, however, have noted that Art. 79 also encompasses the U.S. notion of "frustration of purpose." Thus, Art. 79 may excuse performance where an impediment either renders performance impossible or frustrates the purpose of the contract. Notably, however, Art. 79 does not include the U.C.C. doctrine of "commercial impracticability" (§ 2-615). In addition, it is not entirely clear that frustration of purpose falls within the scope of Art. 79. Indeed, the plain language of Art. 79 suggests that it does not cover frustration of purpose because a frustration "impediment" does not obstruct performance. Instead, frustration merely makes a party not want to perform. Therefore, in order to protect clients engaging in CISG contracts, practitioners should consider including a carefully-drafted and -negotiated force majeure clause (see Chapter 22) that covers frustration of purpose, commercial impracticability, or both. 1123 1275
Although Art. 79 does not use the term impossibility. The requirement that performance be prevented does, however, seem to refer to impossibility instead of impracticability or other less forceful event. 1124 According to Schlechtriem, however, it cannot be concluded that an impediment in the sense of Art. 79(1) of the Convention is only an occurrence that absolutely bars performance. 1125 The Official Comment to Art. 7.1.7 UPICC makes it clear that, this Article covers the ground covered in common law systems by the doctrines of frustration and impossibility of performance, but it is identical with none of these doctrines. 1126 Again, it is to be stressed that the Convention has developed a concept of its own in regard to impediments, which cannot be directly traced back to any national law. This saves from borrowing from a domestic law in interpretation, which could be very misleading, especially when it comes to one's own domestic law. 1127 1276
(c) Pre-contractual impediment
Finally, the three texts are silent on the point of the time of the impediment's occurrence. Therefore, the question arises as to whether they apply in situations where the impediment existed at the time of the conclusion of the contract and was unknown to both parties. The Secretariat Commentary affirms, without justifying its position, that Art. 79 applies to this case: "The impediment may have existed at the time of the conclusion of the contract. For example, goods which were unique and which were the subject of the contract may have already perished at the time of the conclusion of the contract." 1128 From this point, Rimke submits that Art. 79, in its general wording, applies to non-performances that may have occurred at any time. 1129 1278
However, the two Principles seems to be more correct in regarding this situation as defects of content causing the invalidity of contracts, which is not covered under the CISG, rather than non-performance. The Official Comment to Art. 8:108 PECL makes it clear: "It is conceivable that an impediment at the time the contract was made existed without the parties knowing it. For example, the parties might sign a charter of a ship which, unknown to them, has just sunk. This situation is not covered by Article 8:108 but the contract might be avoidable under Article 4:103, Mistake as to Facts or Law." 1130 Similarly, this situation under the UNIDROIT Principles is not covered by Art. 7.1.7 but the contract affected by such impediments may be avoided under Arts. 3.4 and 3.5, i.e. relevant mistake. 1131 1279
The provisions on force majeure are rigid. The exemption becomes effective only when the "failure to perform" or non-performance is based on an impediment which is proved by the non-performing party to cumulatively fulfil the following four conditions:
First, the obstacle must be something outside the debtor's sphere of control. According to Art. 79(1) CISG, Art. 7.1.7(1) UPICC or Art. 8:108(1) PECL, an exemption is permitted only when the impediment to performance is beyond the obligor's control.
According to Stoll, this requirement is based on the assumption that there is a typical sphere of control: a sphere within which it is objectively possible for, and can be expected of, the promisor to be in control. 1132 Within the control of the seller are all those factors which are connected with an orderly organisation of his manufacturing and/or procurement process, as are the personnel's qualifications, the technical equipment and the disposition of the required financial means to ensure manufacture and procurement. His control also includes that he disposes of the required financial means to ensure manufacture and procurement, timely takes care of needed sub-supplies, and does all that is in his power to obtain authorizations by the State. 1133 Accordingly, Schlechtriem submits that the obligor is always responsible for impediments when he could have prevented them but, despite his control over preparation, organization, and execution, failed to do so. In this sense, the obligor "guarantees" his ability to perform. If he wishes to restrict his liability, he must specify the particular impediments for which he will not be liable. 1134 1284
In requiring that the impediment must be beyond the control of the party concerned, the scope of risk of the latter is determined, though only roughly. 1135 "The risk of its own activities it must bear itself. Thus the breakdown of a machine, even if unforeseeable and unpreventable, cannot be an impediment within the article and this avoids investigation of whether the breakdown was really unforeseeable and the consequences unpreventable. The same is true of the actions of persons for whom the debtor is responsible, and particularly the acts of the people it puts in charge of the performance. The debtor cannot invoke the default of a subcontractor unless it was outside its control - for instance because there was no other subcontractor which could have been employed to do the work; and the impediment must also be outside the subcontractor's sphere of control." 1136 1285
Secondly, the impediment must be one that could not have been taken into account at the time the contract was made. The obligor is liable even for impediments beyond his control, as long as they were either reasonably foreseeableor known to him at the conclusion of the contract. In lots of cases, the arbitrators have rejected the existence of force majeure because the element ofunforseeability was lacking. 1137 This rule has been adopted by most domestic systems and is consistent with the basic idea that if the event was foreseeable, the defaulting party should, in the absence of any contrary contractual provision(s), be considered as having assumed the risk of its realization. 1138 If there is a realistic risk of an impediment to performance and the contract is nevertheless unconditionally entered into, the risk of the impediment has been assumed and exemption cannot be successfully claimed. 1139 1287
However, the question of foreseeability is a difficult one. All potential impediments to the performance of a contract are foreseeable to one degree or another. Such impediments as wars, storms, fires, government embargoes and the closing of international waterways have all occurred in the past and can be expected to occur again in the future. 1140 In this respect, it is said that the case law supports the following notion of foreseeability: An event so unlikely to occur that reasonable parties see no need explicitly to allocate the risk of its occurrence, although the impact it might have would be of such magnitude that the parties would have negotiated over it, had the event been more likely. 1141 In the end, most of the phenomena that might become impediments are foreseeable. It is, however, not expected that such events are taken into account which, given general foreseeability, are not expected to materialize before the contract is performed and/or if they do nevertheless, they are at least not expected to have an effect on it. These expectations are further qualified in stipulating that they will have to be reasonable, i.e. that it is proceeded in the customary way, like comparable parties would do. Thereby, an objectivization is effected. 1142 1288
It may be relevant whether the parties could have taken into consideration not just the event itself but the date or period of its occurrence. Foreseeability must be appreciated at the time of the conclusion of the contract. Again, the initial impossibility is not to be discussed here. However, it is a question of whether the promisor ought to have reasonably foreseen a realistic possibility that an impediment to performance would occur. In this respect, Tallon submits: "Foreseeability should not only relate to the impediment per se, but also to the time of its occurrence. The closure of the Suez Canal was, for example, foreseeable in the more or less distant future." 1143 Nonetheless, according to Stoll, the judge or arbitrator should neither refer to an excessively concerned "pessimist who foresees all sorts of disasters" nor to a "resolute optimist who never anticipates the least misfortune". 1144 The Official Comment to the PECL confirms: "A price control for some period may be foreseeable, but it could be an excuse if the period for which it is kept in force was not foreseeable by the parties. Equally it is stated that the test is 'reasonable' foreseeability : that is to say, whether a normal person, placed in the same situation, could have foreseen it without either undue optimism or undue pessimism. Thus in a particular area cyclones may be foreseeable at certain times of year, but not a cyclone at a time of year when they do not normally occur - that would not be reasonably foreseeable by the parties." 1145 1289
Frequently, the parties to the contract have envisaged the possibility of the impediment which did occur. Sometimes they have explicitly stated whether the occurrence of the impending event would exonerate the non-performing party from the consequences of the non-performance. In other cases it is clear from the context of the contract that one party has obligated himself to perform an act even though certain impediments might arise. In either of these two classes of cases, Art. 6 CISG assures the enforceability of such explicit or implicit contractual stipulations. However, where neither the explicit nor the implicit terms of the contract show that the occurrence of the particular impediment was envisaged, it is necessary to determine whether the non-performing party could reasonably have been expected to take it into account at the time of the conclusion of the contract. In the final analysis this determination can only be made by a court or arbitral tribunal on a case-by-case basis. 1146 1290
Everything regarding foreseeability, therefore, is a matter of measure, and it seems difficult to provide more details in a general text. 1147 This second condition, which an impediment to cause an exemption will have to fulfill, describes in a very flexible manner the criterion of foreseeability, which may nevertheless be particularly specified from the force majeure clauses. 1148 However, it is important to understand that, in the assessment of the foreseeability factor, other circumstances should also be considered, such as the duration of the contract (the longer the duration, the less likely the contracting parties will be able to foresee possible impediments), the fact that the price of the goods sold tends to fluctuate in the international market, or the fact that early signs of the impediment were already obvious at the time of the conclusion of the contract. 1149 1291
Thirdly, even if the non-performing party can prove that he could not reasonably have been expected to take the impediment into account at the time of the conclusion of the contract, he must also prove that he could have neither avoided the impediment nor overcome it or the consequences of the impediment. This rule reflects the policy that a party who is under an obligation to act must do all in his power to carry out his obligation and may not await events which might later justify his non-performance. This rule also indicates that a party may be required to perform by providing what is in all the circumstances of the transaction a commercially reasonable substitute for the performance which was required under the contract. 1150 1293
As it does with regard to foreseeability, reasonableness also qualifies the condition that the impediment must be insurmountable or irresistible. It must be emphasised that both conditions - that the party could not have avoided it and could not have overcome it - must be fulfilled before an excuse can operate. The party to be excused must prove that it could not have done either. 1151 It is in line with the general liability of the parties in regard to the obligations they have assumed that they have to counteract impediments. The two main forms of doing so are mentioned here. First, disturbances will have to be avoided. In order to achieve this, measures will have to be taken against such impediments which are generally looming ahead but cannot, a priori, be put in relation to the fulfilment of concrete obligations. These include measures of protection against accidents and specifically fire; a factory management which guarantees peaceful labour relations; etc. Above all, measures have to be taken against disturbances which are clearly approaching. Second, where a disturbance has already revealed itself, it has to be overcome as speedily as possible invoking, for instance, remedies against hindering decisions by the State insofar as they have a chance of succeeding. It is the requirement of overcoming which is aimed at removing the consequences of disturbances. Hence, the effects of accidents have to be removed fast. 1152 1294
Thus, the basis of reference is what can reasonably be expected from the party concerned, one cannot expect the debtor to take precautions out of proportion to the risk (e.g. the building of a virtual fortress) nor to adopt illegal means (e.g. the smuggling of funds to avoid a ban on their transfer) in order to avoid the risk. 1153 "The yardstick used to measure the efforts of the party concerned is again what can reasonably be expected from him. And that is what is customary, or what similar individuals would do in a similar situation. The exemption is thus granted when efforts would have been necessary that go beyond the former." 1154 Therefore, an impediment may be avoided or overcome, for example, by choosing another form of transport or another route (like shipping the goods via the Cape of Good Hope instead of the Suez Canal) or even by delivering a commercially reasonable substitute for the performance which was required by the contract. However, the promisor should not be expected to risk his own existence by performing his obligations at all costs. Avoidance should take place in the most effective manner from an economic point of view, that is, with conclusion of an insurance contract (if this is the norm and it is available), with the insertion of special clauses in the contract of sale, or with the adaptation of the price in order to reflect assumption of the risks by the seller or the buyer. 1155 1295
In a word, again reference should be made to the reasonable person, and a case-by-case analysis will be necessary. 1156 Whether an event could have been avoided or its consequences overcome depends on the facts. 1157 1296
Finally, the decisive prerequisite for an impediment to be taken into consideration is its causality in regard to the breach of contract.
Tallon believes that impediment should be the only cause for the promisor's non-performance so as to exempt the non-performance. 1158 Unlike Tallon, Eiderlein and Maskow are of the opinion that, it cannot be required that the impediment is the exclusive cause of a breach of contract. This is true not only of cases in which it covers the breach of contract only partially, but the impediment should also be accepted when a cause overtakes another cause. It is decisive whether the impediment lastly has caused the breach of contract. 1159 1299
Nevertheless, if a party has breached by delay and an impediment arises thereafter, the impediment will not excuse the non-performance. There will be no excuse if an unforeseeable event impedes performance of the contract when the event would not have affected the contract if the party had not been late in performing. 1160 1108. See Fritz Enderlein, Dietrich Maskow in "International Sales Law: United Nations Convention on Contracts for the International Sale of Goods", Oceana Publication (1992); pp. 320-321. Available online at ‹http://www.cisg.law.pace.edu/cisg/biblio/enderlein.html› 1109. See Tom Southerington in "Impossibility of Performance and Other Excuses in International Trade": Tuula Ämmälä ed., Publication of the Faculty of Law of the University of Turku, Private law publication series B:55 (2001). Available online at ‹http://www.cisg.law.pace.edu/cisg/biblio/southerington.html› 1110. Supra. note 15, Comment D. 1111. Supra. note 10. 1112. See Denis Tallon, Commentary on the International Sales Law - The 1980 Vienna Sales Convention, C.M. Bianca and M.J. Bonell eds. (1987); p. 579. 1113. Supra. note 19, p. 320. 1114. Supra. note 8. 1115. See John O. Honnold, Uniform Law for International Sales(1999); p. 476. 1116. See Hans Stoll in "Exemptions": COMMENTARY ON THE U.N. CONVENTION ON THE INTERNATIONAL SALE OF GOODS (CISG), Peter Schlechtriem ed., Geoffrey Thomas trans. (2d ed. 1998); p. 608. 1117. See Dionysios P. Flambouras in "The Doctrines of Impossibility of Performance and clausula rebus sic stantibus in the 1980 Vienna Convention on Contracts for the International Sale of Goods and the Principles of European Contract Law: A Comparative Analysis": 13 Pace International Law Review(Fall 2001); pp. 267-268. Available online at ‹http://www.cisg.law.pace.edu/cisg/biblio/flambouras1.html› 1118. Supra. note 15, Comment B. 1119. See Peter Schlechtriem, Uniform Sales Law - The UN-Convention on Contracts for the International Sale of Goods, Manz, Vienna (1986); p. 102. Available online at ‹http://www.cisg.law.pace.edu/cisg/biblio/schlechtriem-79.html› 1120. See Joseph M. Perillo in "Force Majeure and Hardship under the UNIDROIT Principles of International Commercial Contracts": Contratación internacional. Comentarios a los Principios sobre los Contratos Comerciales Internacionales del Unidroit, Universidad Nacional Autónoma de México - Universidad Panamericana (1998); pp. 121-122. Available online at ‹http://www.cisg.law.pace.edu/cisg/biblio/perillo3.html› 1121. Supra. note 9, Comment 10. 1122. Supra. note 29. 1123. See Jennifer M. Bund in "force majeure Clauses: Drafting Advice for the CISG Practitioner": 17 Journal of Law and Commerce (1998); p. 387. Available online at ‹http://www.cisg.law.pace.edu/cisg/biblio/bund.html› 1124. Supra. note 20. 1125. Supra. note 30. 1126. See Comment 1 on Art. 7.1.7 UPICC; 1127. Supra. note 24. 1128. Supra. note 9, Comment 4. However, the seller would not be exempted from liability under this article if he reasonably could have been expected to take the destruction of the goods into account at the time of the conclusion of the contract. Therefore, in order to be exempt from liability, the seller must not have known of their prior destruction and must have been reasonable in not expecting their destruction. 1129. Supra. note 14, p. 215. 1130. Supra. note 29. 1131. This can be supported by both Art. 3.3 UPICC and Art. 4:102 PECL deal with the initial impossibility and stipulate that a contract is not invalid merely because at the time it was concluded performance of the obligation assumed was impossible, or because a party was not entitled to dispose of the assets to which the contract relates. However, as clarified in Chapter 19, such initial impossibility is not the subject to be discussed here. 1132. Supra. note 27, p. 610. 1133. Supra. note 19, pp. 322-323. Opinions may differ as to whether strikes are beyond the control of the party concerned, for their causes are often found in the enterprise. Eiderlein and Maskow believe that one should follow those authors who like Vischer take a careful stand in the matter and do not exclude strikes as impediments, except when they are internal confrontations at a factory and provided that the other conditions of impediments are fulfilled, too. Rudolph however believes that strikes could generally be considered as possible in the context of negotiations on pay and therefore would not constitute an impediment because they happen at specific intervals. This is true of strikes which can be foreseen at the time of the conclusion of the contract. Lockouts are, at least to a certain extent, not exterior to the activities of the debtor and can, therefore, not be considered as impediments. 1134. Supra. note 30, p. 101. 1135. Supra. note 19, p. 322. 1136. Supra. note 15, Comment C(i). 1137. E.g., 1974 Clunet 892; 1975 Clunet 929; 1975 Clunet 934; 1975 , Clunet 917; 1980 Clunet 951. 1138. Supra. note 23, p. 580. 1139. Supra. note 27, p. 611. 1140. Supra. note 9, Comment 5. 1141. See Trimarchi, Pietro in "Commercial Impracticability in Contract Law: An Economic Analysis": 11 Int'l Re v. of L. and Ec. (1991); p. 63, 65. 1142. Supra. note 19, pp. 323-324. 1143. Supra. note 23, pp. 580-581. 1144. Supra. note 50. 1145. Supra. note 15, Comment C(ii). 1146. Supra. note 9, Comments 5, 6. 1147. Supra. note 14, p. 216. 1148. Supra. note 46. 1149. Supra. note 28, p. 271. 1150. Supra. note 9, Comment 7. 1151. Supra. note 15, Comment C(iii). 1152. Supra. note 19, p. 324. 1153. Supra. note 62. 1154. Supra. note 63. 1155. Supra. note 28, p. 272. 1156. Ibid. 1157. Supra. note 62. In an earthquake zone the effects of earthquakes can be overcome by special construction techniques, though it would be different in the case of a quake of much greater force than usual. 1158. Supra. note 23, p. 583. 1159. Supra. note 46. 1160. Supra. note 47. It is important to mention that the force majeure must have come about without the fault of either party under the European Principles; whereas interpretations which try to make clear that the fault principle is implemented in the CISG do not correspond to reality, the question of fault is not involved here since this concept has been set aside by the Convention [ document manifest ]