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| An Italian seller and a German buyer concluded a contract for the sale of a machinery. The buyer failed to pay the whole price and the seller commenced an action to recover the balance of the price. The buyer alleged the non conformity of the machinery. The buyer also requested set-off against the seller's claim.
The Court held that the contract was governed by CISG because at the time of the conclusion of the contract, the parties had their places of business in contracting States (Italy and Germany) (Art. 1(1)(a) CISG). Confirming the lower court's decision, the Court found that the buyer had lost the right to rely on a lack of conformity of the goods, since it failed to prove it had given notice within a reasonable time and had also failed to specify the nature of the defects (Art. 39(1) CISG). In the Court's opinion, under CISG and different national approaches and legal traditions on this subject, a 'reasonable' time consisted of approximately one month after the buyer discovered defects or ought to have discovered them. With regard to set-off (Art. 4 CISG), the Court held that this is a matter not covered by CISG. By virtue of the German private international law rules, the Court applied Italian law under which the set-off claim was denied. Therefore, the buyer had to pay the balance of the price according to Art. 53 CISG. |