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| An Italian and a German company (respectively, the seller and the buyer) entered into a contract for the sale of decoration paper. In addition they concluded a distribution agreement whereby the producer (the seller) granted the exclusive sales rights to the buyer. The seller brought legal action against the buyer, requesting payment for deliveries made. The buyer refused to pay and claimed, inter alia, set-off with sum corresponding to allegedly due commissions under the distribution agreement.
The first instance Court (Landgericht Ravensburg – Kammer für Handelssachen – 09.03.2004, AZ. 8 O 206/2003 KfH 2) found for the seller and the buyer appealed. First of all, the appellate Court held that the CISG was applicable to the dispute under its Art. 1(1)(a), as the two parties were situated in Contracting States. As to the set-off, the Court found that it was a matter not covered by CISG, to be decided according to the applicable domestic law (i.e. Italian law), under which set-off was denied. The Court further held that also the question of a right of retention is a matter not covered by CISG, to be determined under the applicable domestic law (which denied such a right in the case at hand). Finally, the Court awarded interest on the sums due (Art. 78 CISG), at a rate determined in accordance with the domestic law otherwise applicable to the contract (Italian law) |