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| Abstract | ||||||||||||||||||
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| On January 9th, 2004, a German seller sent a “price offer” to a French buyer for the sale of 1600 tons of cathode-ray tubes at the total price of € 50.000. On January 16th, the buyer paid the purchase price by bank transfer. Shortly thereafter, the buyer found a customer in Hong Kong willing to purchase the goods at a much higher price and then began arranging for the transportation of the goods abroad. On February 13th, 2004, realizing that it could obtain a better price elsewhere, the seller enjoined the buyer to take delivery of the goods within one week. Also, the seller advised the buyer that if it failed to do so, it would reimburse part of the purchase price, after deducting €20.000 in storage costs and damages. Since the buyer had already planned to resell the goods, and had taken measures for this purpose, it offered to sell the goods back to the seller at the price of €160.000. The buyer’s proposal was not followed accepted by the seller, which returned the purchase price in March 2004 and refused to deliver the goods declaring its January 9th offer no longer effective. Later, the buyer sued the seller seeking to obtain damages resulting from the latter's illegitimate termination of the contract.
As the application of CISG was not in dispute, the Court found that a contract between the parties had actually been concluded, In fact, the seller’s letter dated January 9th, though referred to as “price offer”, was precise enough to be considered as an offer which had been accepted by the buyer through payment of the price (art. 23 CISG). Consequently, the issue addressed by the Court was whether the seller, by returning the price and refusing to deliver the goods, had rightfully terminated the contract. Since the buyer had fulfilled its main obligation to pay the price (art. 53 CISG), the Court considered whether the buyer had violated its obligation to take delivery of the goods. In doing so, the Court noted that the offer did not fix any time for taking delivery of the tubes and the seller itself had never mentioned any time-limit to be observed nor questioned the buyer about the time necessary for taking delivery of them. In the Court’s view, absent a specific time for delivery in the contract, such time, as well as the additional period granted by the seller pursuant to art. 63 CISG, was to be calculated ion the basis of the usages accepted by the parties or the established practices between themselves, or any other relevant international trade usage (Art. 9 CISG). Moreover, the Court found that only five weeks had gone by from the time of conclusion of the contract to the seller's granting the buyer by letter of a seven day additional period for performance. Taking into account the nature and the quantity of the goods sold, as well the time needed for sorting items of that weight and size, a period of five weeks could not be considered reasonable. Therefore, the buyer could not be held in breach of contract for failing to take delivery of the goods within such a short period. Likewise, an additional time of seven days was deemed unreasonable under the circumstances of the case. As a result, the Court ordered the seller to pay damages to the buyer (art. 74 CISG) plus interest calculated on the basis of the statutory rate (art. 78 CISG). |