Date: 22.07.2004
Country: Germany
Number: I-6 U 210/03
Court: Oberlandesgericht Düsseldorf
Parties: --
An Italian seller (plaintiff) and a German buyer (defendant) concluded a contract for the sale of shoes. The buyer failed to pay the price for a partial delivery, alleging that no agreement had been reached between the parties as to that delivery. As a result, the seller brought an action against the buyer, claiming for payment of the allegedly total contract price.

The first instance Court (Landgericht Düsseldorf, 28-08- 2003, no.36 O 193/02) ruled that the buyer was obliged to pay the price under Art. 58 (1)1, (3) CISG and awarded damages to the seller(Art. 61(1)(b) CISG). The appellate Court reversed the first instance decision in part.

After recalling that a formal request for payment is not required under CISG (Art. 59 CISG), the Court held that the seller was entitled to reimbursement of its lawyer costs as damages according to Arts. 61 (1)(b) and 74 CISG.

The Court also awarded interest on the sums to be paid (Art. 78 CISG). Since CISG does not determine the rate of interest, the Court stated that the rate was to be determined in accordance with the domestic law otherwise applicable to the contract (i.e. Italy).

As opposed to the first instance Court, the appellate Court held that the seller was not entitled to claim damages based on a cover sale under Art. 75 CISG. The application of this provision is conditioned upon avoidance of the contract. The seller however failed to prove that it had given appropriate notive of avoidance as required by Art. 26 CISG. Moreover, even if the seller had given due notice, avoidance would not be admissible under Arts. 64 and 25 CISG, since, inter alia, there was no fundamental breach on the part of the buyer (being late payment not a fundamental breach if time is not of the essence) nor had the seller set an additional time to perform.