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| Abstract | ||||||||||||||||||
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| In November 2001, a Dutch buyer and a German seller entered into negotiations for the supply of a mixture of potting soil which would contain, among others, an ingredient named clay “Baraklei”. The seller then forwarded an offer for a mixture of potting soil at the price of 49,00 Euro per m3, which the buyer rejected. In this offer, the seller stated that the mixture of potting soil would contain 3% clay. Soon afterwards, the seller faxed another offer at the price of 41,74 Euro per m3, stating that the mixture would possess “40 kg clay per m3”; the buyer accepted.
The seller supplied the buyer with seven subsequent deliveries; on each delivery, the buyer was provided with a note specifying that the soil mixture contained 3% clay Baraklei. Two months after the first delivery, the buyer notified the seller that the soil delivered did not comply with the contract since it did not contain the contracted amount of clay (“40 kg clay per m3); additionally, it complained that the soil had caused damage to its plants. The Court of First Instance ruled that CISG was applicable and dismissed the claim because it found that the buyer had not given the seller notice of the non-conformity of goods within a reasonable time pursuant to Art. 39(1) CISG. The Court of Appeal confirmed the Court of First Instance’s decision. After finding that CISG was the law governing the contract (Art. 1(1)(a) CISG), it held that, under Art. 35(1) CISG, the seller is under a contractual obligation to provide the buyer with goods conforming to the quantity, quality, and description stated in the contract. Nonetheless, the Court found that the buyer should have known from the very beginning (i.e. first delivery) that the quantity of clay contained in the goods delivered was other than that agreed upon, since it had signed the bill of receipt; moreover, there was evidence that the buyer knew that the quantity of 3% was not equal to the quantity of “40 kg clay per m3”. Consequently, the Court held that the buyer had lost its right to rely on the lack of conformity under Art. 39(1) CISG, having failed to give notice thereof on or a few days after the first delivery, i.e. after the time it became aware of or should have become aware of the non-conformity. In reaching this conclusion, the Court rejected the buyer’s argument that the reasonable time provided for by Art. 39 CISG within which notice of lack of conformity is to be given, has to run not from the time the buyer became or should have become aware of lack of conformity but only after it had discovered that the difference in the amount of clay would cause damage to its plantations. Finally, the Court rejected the buyer’s argument that, since the seller had not alleged the violation of Art. 39 CISG in the previous proceedings, this would amount to an infringment of the good faith principle set out in Art. 7 CISG, as this was a new issue not explicitly agreed by seller to be taken into account in the proceedings. |