|
||||||||||||||||||
| Abstract | ||||||||||||||||||
| ||||||||||||||||||
| A German buyer and two French sellers entered into an agreement for the sale of Italian sunflower oil to be delivered in monthly instalments to a buyer's customer in Rumania. The seller made a advance payment for the delivery of a first instalment of oil. After having discovered that the sellers never delivered the first instalment of oil to the Rumanian customer, the buyer fixed an additional period of time for delivery. The sellers did not perform within the additional period of time set by the buyer. Upon expiration of the additional period of time the buyer declared the contract avoided. The buyer brought an action to recover the advance payment and damages.
In the Court's opinion the buyer had validly declared the avoidance of the contract according to Art. 73(1) and 49(1)(b) CISG, as the sellers had not performed within the additional period of time for performance set by the buyer. The failure to perform their obligations in respect to the first instalment gave the buyer good grounds for concluding that a fundamental breach would occur also with respect to future instalments (Art. 73(2) CISG). The court held therefore that the buyer was entitled to receive restitution of the advance payment as a consequence of the avoidance of contract (Art. 81(2) of CISG). With respect to the claim for damages claim, the court held that the buyer was entitled to recover the costs it had sustained for the advance payment as well as the loss of profit (Art. 74 of CISG). Moreover, the buyer was awarded consequential damages for losses suffered due to the variation of the exchange rate between US$ (currency of payment) and DM, which is to be calculated as the difference between the exchange rate on the date of the advance payment under the contract and the date on which restitution of payment will be made. Finally, according to Art. 84 CISG the buyer was entitled to interest on the advance payment, to be calculated from the date payment had been made. The court stated that, although in principle the buyer would have been entitled also to interest on the loss of profit according to Art. 74 of CISG, in the case at hand the buyer lost its right to interest as it did not give sufficient evidence as to the time in which the profits would have been made. The court awarded the buyer the restitution of the advance payment plus interest (Art. 78 CISG). As to the applicable rate of interest, the court applied the interest rate of the sellers' place of business, that being the place in which the sellers usually invest their money. |