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| Abstract | ||||||||||||||||||
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| In 1999, an Italian company agreed to supply and deliver four cisterns and relative accessories to an Egyptian company. Upon delivery of the goods the seller brought an action against the buyer and Italian and Egyptian banks, requesting the Court to adopt a provisional measure to prevent the Italian and Egyptian banks from paying the sum of US $93,200.00 to the buyer in execution of a bank guarantee. The Italian Court took the provisional measure the seller had requested and then the latter initiated proceedings requesting the Court to declare the buyer's claims unfounded. All defendants defaulted.
In its judgment the Court, in order to promote uniformity in the interpretation and application of the Convention (Art. 7(1) CISG, relied with respect to each issue on a number of decisions on CISG that had already been rendered by foreign courts and arbitral tribunals. In deciding the case the Court first of all stated that the contract was governed by CISG. After observing that uniform law such as CISG prevails over the applicable private international law rules, the Court found that the substantive requirements for the application of the Convention had been met. Making reference to Arts. 30 and 53 CISG concerning the parties' obligations which were therefore the relevant provisions for determining the notion of contract of sale under the Convention, the Court considered that the agreement entered into by the parties was a sales contract. The Court also noted that, as the contract provided only for supervision by the seller of the assembling of the goods, such a service could not be considered as the preponderant part of the seller's obligations under the contract (Art. 3(2) CISG). Therefore, since both parties had their places of business in different Contracting States (Art. 1(1)(a) CISG) and had not excluded, even tacitly, the application of the Convention (Art. 6 CISG), the dispute at hand was governed by CISG. As to the merits of the dispute, the Court rejected the buyer’s argument that the seller had not delivered the goods by the agreed dates. Referring to Art. 46 CISG, the Court found that the buyer’s request to have the bank guarantee’s duration prolonged after the goods had been delivered, prevented it from relying on late performance by the seller. The Court also rejected the buyer’s claim that a part of the instalments were non-conforming. In so doing, the Court held that the buyer’s notice of non-conformity which had been given thirteen months after delivery, i.e. after the buyer should have discovered the defects, was not reasonable according to Art. 39 CISG. As a result, the buyer had lost its right to rely on the non-conformity of the goods. In Conclusion, the Court declared that no breach of contract had been committed by the seller and prevented the buyer from executing the guarantee as well as the banks from making any payment under the same. |