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| A Belgian buyer ordered fashion goods (winter clothes) from a Dutch seller. After delivery of the goods and partial payment, the buyer placed a second order regarding summer clothes. The seller replied that it would deliver the summer clothes only upon full payment of the invoices sent for the first order and still unpaid. The buyer commenced an action asking for damages caused by the failure to deliver the ordered goods. The seller counterclaimed.
The Court held that the contract was governed by CISG, either because the seller's standard terms contained a choice of law clause in favor of The Netherlands, a contracting State, or - if the clause had not become part of the contract - because the Belgian private international law rules referred to Dutch law (Art. 1(1)(b) CISG). In the Court's opinion, according to Art. 71 CISG the seller had the right to suspend its performance, i.e. delivery of the second order, until full payment of the first delivery, especially taking into account that the buyer's serious delay in payment (over seven months) could reasonably lead to the suspicion that it would not perform in the future. The Court held that the seller had the right to avoid the contract under Art. 64 CISG without recourse to a Court order. The seller was further awarded damages and interest on the sums due. Without referring to CISG the Court applied the interest rate determined by the standard practice of the same Court. |